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Monday 3 April 2023
Texas Man Sentenced to 97 Months in Federal Prison for Distributing Child Pornography in LouisianaRead the Press Release
United States Attorney Ronald C. Gathe, Jr. announced that Chief Judge Shelly D. Dick sentenced James Martin, age 51, of Beckville, Texas, to 97 months in federal prison following his conviction for distribution of child pornography. Martin must serve five years of supervised release upon completing his term of imprisonment, and he must complete sex offender treatment. The Court also ordered Martin to pay $248,000 in restitution. As a result of this conviction, Martin will be required to register as a sex offender.
Throughout July and August 2022, Martin used an instant messaging mobile application and a smartphone to distribute files of child pornography via the internet to an undercover agent in the Middle District of Louisiana. Martin distributed the videos and images of minors, knowing they were under 18 years of age. The child pornography files included a video link to a cloud storage application.
Martin distributed the video link to an undercover agent with a password and instructions to download the videos and images to confirm that the link was “working and sellable when the time [i]s right…” Throughout his conversations with undercover law enforcement, Martin described a scheme to sell child pornography online. Martin bragged about his ability to: (1) sell child pornography online for a profit; and (2) use encryption software to avoid law enforcement detection.
Martin’s video link contained approximately 245 videos and 108 images of child pornography, including toddlers. Martin also possessed at least 130 total videos and approximately 7,250 images of child pornography, which were accessible through his laptop, smartphone, and a central processing unit tower, among other devices.
This matter was investigated by the Federal Bureau of Investigation, the Louisiana Bureau of Investigation, and the Panola County, Texas Sheriff’s Office, and was prosecuted by Assistant United States Attorney Edward H. Warner.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc.
Tampa Man Charged with Preparing False Tax ReturnsRead the Press Release
Tampa, Florida – United States Attorney Roger B. Handberg announces the return of an indictment charging Kenneth Fowler with three counts of making and filing false federal income tax returns. If convicted, Fowler faces a maximum penalty of three years’ imprisonment as to each count.
According to the indictment, between the end of December 2013 and August 2018, Fowler, who was then working as a payroll coordinator at the Salvation Army Suncoast Adult Rehabilitation Center in St. Peterburg, engaged in a scheme to embezzle funds from the Salvation Army. Fowler falsely altered records to reflect that employees who had left the employment of the Salvation Army were still on its payroll so that Fowler could collect their paychecks and ultimately forge their signatures and deposit those checks into his own personal bank accounts. Fowler also misdirected direct deposit checks from the former employees’ bank accounts into his own personal bank account. In this manner, Fowler obtained more than $239,000 in Salvation Army funds to which he was not entitled. He then failed to include those stolen funds as income on his 2016, 2017, and 2018 Individual Income Tax Returns. By doing so, he avoided the payment of substantial taxes due and owing to the United States.
An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the Internal Revenue Service - Criminal Investigation, with assistance from the Pinellas Park Police Department. It is being prosecuted by Assistant United States Attorney Jay L. Hoffer.
Suburban Chicago Woman Charged with Filing False Income Tax Returns with the Internal Revenue ServiceRead the Press Release
CHICAGO — An Orland Park resident and owner of a sandwich shop in Plainfield has been charged with three counts of filing a false tax return.
Per the information, HEYAM P. MALICK, 64, of Orland Park knowingly filed false tax returns with the Internal Revenue Service between the years 2016 to 2020. Malick was the owner and sole employee of Smiley’s Gyros and Beef, located in Plainfield. As charged in the information, Malick is accused of under reporting her income from the business by more than $725,000 over three years.
The charge is announced by Morris Pasqual, Acting United States Attorney for the Northern District of Illinois and Justin Campbell, Special Agent-in-Charge of the Internal Revenue Service Criminal Investigation in Chicago. The government is represented by Assistant U.S. Attorney Thomas P. Peabody.
The public is reminded that an information contains only a charge and is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. The charge of tax fraud carries a possible sentence of up to three years in federal prison on each count. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.
Stanislaus County Woman Pleads Guilty to Stealing Money from Recipients of Social Security and Other Government BenefitsRead the Press Release
FRESNO, Calif. — Lorene Deanda, 64, of Ceres, pleaded guilty today to mail fraud in relation to her stealing more than $550,000 from recipients of Social Security and other government benefit funds, U.S. Attorney Phillip A. Talbert announced.
According to court documents, Deanda was employed by a charitable organization in Modesto and managed the organization’s representative payee program. This program assisted recipients of Social Security and other federal and state benefits who could not physically manage their own financial affairs. Deanda, on behalf of the charitable organization, would set up bank accounts for the beneficiaries and receive benefit funds into those accounts. Deanda’s duties included paying beneficiaries’ bills and necessities from those accounts. However, from 2003 to May 2015, Deanda stole benefit funds from the beneficiaries’ accounts and spent the money on her own personal expenses, including to pay for her personal credit card bills and residential mortgage. In total, Deanda stole over $550,000.
This case is the product of an investigation by the Social Security Administration - Office of the Inspector General and the Federal Bureau of Investigation. Assistant U.S. Attorneys Henry Z. Carbajal III and Brittany M. Gunter are prosecuting the case.
Deanda is scheduled to be sentenced by U.S. District Judge Jennifer L. Thurston on July 24, 2023. Deanda faces a maximum statutory penalty of 20 years in prison and a fine of $250,000. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Stanislaus County Man Pleads Guilty to Federal Drug ChargesRead the Press Release
FRESNO, Calif. — Julian Loeza, 33, of Ceres, pleaded guilty today to distribution of methamphetamine, U.S. Attorney Phillip A. Talbert announced.
According to court documents, in 2020, a team of local and federal law enforcement officers partnered in an investigation into the drug trafficking activities of Julian Loeza and Esmerelda Ceja-Mendez, 43, of Ceres; Sofia Cisneros-Noyola, 37, of Sacramento; and Victor Ramirez, 37, of Atwater. On March 3, 2021, Loeza sold 2 pounds of methamphetamine for $3,600.
This case is the product of an investigation by the Federal Bureau of Investigation and the San Joaquin County Metropolitan Narcotics Task Force. Assistant U.S. Attorney Antonio J. Pataca is prosecuting the case.
Ramirez has pleaded guilty to conspiracy to distribute and possession with intent to distribute methamphetamine and possession with intent to distribute methamphetamine. Ramirez is scheduled to be sentenced by U.S. District Judge Jennifer L. Thurston on May 15, 2023.
Charges are pending against Ceja-Mendez and Cisneros-Noyola; they are presumed innocent until and unless proven guilty beyond a reasonable doubt.
Loeza is scheduled to be sentenced by U.S. District Judge Ana de Alba on July 17, 2023. Loeza faces a mandatory minimum sentence of 10 years in prison and a maximum sentence of life in prison. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Sioux City Man Sent to Federal Prison for Being a Marijuana User in Possession of a FirearmRead the Press Release
A man who possessed a firearm on multiple occasions and intentionally fired upon a car full of people including two young children and who negligently shot a woman in the leg was sentenced, to 3-years in federal prison.
Jalond Hills, 19, from Sioux City, received the prison term after a guilty plea to one count of felon in possession of a firearm.
Evidence in the case showed that on or about September 16, 2021, Jalond Hills, fired at an individual who was in a car with a woman and her two minor children. Jalond Hills was caught with the gun and confessed he was in possession of the gun and had fired it while being a user of illegal drugs.
Further, on or about April 15, 2022, Jalond Hills, was at an apartment in the 2200 block of Gibson Street where he and another person began wrestling over a firearm. The other person was trying to make the weapon safe, and Hills wanted the weapon. In the end, the other person was shot in the leg while attempting to take control of the gun. After Hills contributed to this horrible accident, he cut off his location monitoring bracelet, and absconded without even stopping to check on the other person as she began to bleed out.
Jalond Hills was previously convicted of possession of a controlled substance as a juvenile, in the Woodbury County, Iowa District Court at Case Number SRCR112683.
Jalond Hills was sentenced in Sioux City by United States District Court Chief Judge Leonard T. Strand, to 36 months’ imprisonment. He must also serve a 2-year term of supervised release after the prison term and pay a $100 special assessment fee. There is no parole in the federal system.
Jalond Hills is being held in the United States Marshal’s custody until he can be transported to a federal prison.
This case was brought as part of Project Safe Neighborhoods (PSN). PSN is 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.
The case was investigated by the Sioux City, Iowa Police Department and prosecuted by Assistant United States Attorney Forde Fairchild.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 22-04057.
Follow us on Twitter @USAO_NDIA.
Sinaloa Cartel Distributor Sentenced for Methamphetamine Conspiracy and Firearms CrimesRead the Press Release
United States Attorney Steven Russell announced that Jose Leyva-Martinez, 49, was sentenced today in federal court in Omaha, Nebraska, for his participation in a methamphetamine drug conspiracy and for possessing a firearm during a drug trafficking crime. Chief United States District Judge Robert F. Rossiter, Jr. sentenced Leyva-Martinez to 210 months’ imprisonment on the drug charge and a consecutive 60 months’ imprisonment on the firearm charge for a total sentence of 270 months. There is no parole in the federal system. After his release from prison, he will begin a five-year term of supervised release.
On March 31, 2021, an Omaha Police confidential source purchased more than 50 grams of methamphetamine from an Omaha-based methamphetamine dealer. A search of the dealer’s home resulted in the seizure of more than 300 grams of methamphetamine, 19 grams of heroin, 14 grams of cocaine, a Glock 10mm handgun, and $5,744 in United States currency.
In an interview with police, the Omaha dealer provided police with the name of his supplier: Leyva-Martinez. With this information, officers searched Leyva-Martinez’s home, seizing nearly 4 kilograms of methamphetamine, 1 kilogram of cocaine, money transfer receipts, ammunition, 2 drug scales, vehicle titles for a gray Toyota Tacoma, a gray Honda civic, and a black GMC 1500, a money counter, drug ledger, jewelry, $468,990.00 in United States currency, and an Astra 9mm handgun. The handgun was found in a bedroom near $28,000 in United States currency.
Leyva-Martinez admitted being a methamphetamine supplier and distributor for the Sinaloa Cartel. He admitted that all three vehicles and the residence were put in his name at the direction of the Cartel. Law enforcement estimated that the seized currency represented cash proceeds from the sale of more than 100 pounds of methamphetamine.
Leyva-Martinez’s home, vehicles, monies, and other valuables were seized by law enforcement as proceeds of narcotics trafficking.
This case was investigated by the Omaha Police Department.
San Antonio Woman Pleads Guilty to Providing Fentanyl That Led to Man’s DeathRead the Press Release
SAN ANTONIO – A San Antonio woman pleaded guilty in San Antonio federal court Thursday to distribution of a controlled substance resulting in death.
According to court documents, Claudia Cardenas, 47, provided a man with a sample of fentanyl on May 8, 2022, allowing him to try the substance before committing to future purchases. The man ingested the fentanyl sample the following day. He immediately collapsed and was unresponsive. Two doses of Narcan were administered prior to the arrival of Emergency Medical Services, but the man was declared deceased upon EMS’s arrival. An autopsy revealed that the victim’s death was the result of toxic effects from Fentanyl and Methamphetamine.
Cardenas is scheduled to be sentenced on July 13 and faces a penalty of at least 20 years in prison up to life imprisonment. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
U.S. Attorney Jaime Esparza for the Western District of Texas and Special Agent in Charge Daniel Comeaux of the Drug Enforcement Administration made the announcement.
The DEA; the University of Texas at San Antonio Police Department; the San Antonio Police Department; the Texas Department of Public Safety; and the Alamo Heights Police Department are investigating the case.
Assistant U.S. Attorney Amy Hail is prosecuting the case.
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SWGA Man Sentenced to Prison Resulting from Armed Drug Trafficking InvestigationRead the Press Release
ALBANY, Ga. – A Southwest Georgia resident with a criminal record who admitted to distributing heroin resulting from an armed drug trafficking investigation was sentenced to prison for his crime.
Alexander Brown, Sr. aka “Poochie,” 48, of Albany, was sentenced to serve 120 months in prison to be followed by four years of supervised release by U.S. District Judge Leslie Abrams Gardner on March 30, after he previously pleaded guilty to distribution of heroin. There is no parole in the federal system.
“Armed repeat offenders remain a high priority for our office and our law enforcement partners,” said U.S. Attorney Peter D. Leary. “I appreciate the hard work and cooperation that resulted in this conviction and sentencing.”
“The combination of drugs and guns is destructive in so many ways to our communities,” said Keri Farley, Special Agent in Charge of FBI Atlanta. “Our agents focus daily on getting repeat offenders like Brown off our streets. The FBI and the partners we work with are committed to stopping these destructive drug operations flowing through our state.”
“Illegal drugs and guns are dangerous and threaten the safety of Georgia communities. The GBI is committed to working with our partners to investigative drug and gun dealing. Thank you to the U.S. Attorney’s Office for prosecuting this defendant, making the Albany area safer,” said GBI Director Mike Register.
According to his plea agreement and court records, the GBI began investigating Brown in Jan. 2021 for distributing heroin; multiple recorded purchases of narcotics from Brown occurred during the course of the investigation. On Sept. 15, 2021, an undercover agent went to Brown’s apartment on Maryland Drive in Albany. Brown offered to get the agent fully automatic AR-15 rifles, which he described as ghost guns without serial numbers. Brown also sold the agent heroin. On Oct. 14, 2021, GBI and FBI agents purchased a rifle from Brown at a residence on Askew Drive in Dawson, Georgia. A search warrant of the Askew Drive residence was executed on Nov. 2, 2021. Agents recovered heroin, methamphetamine and fentanyl, in addition to drug distribution paraphernalia and $12,000. Brown has a criminal history with convictions in Dougherty County, Georgia, Superior Court, including a conviction for possession with intent to distribute oxycodone.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities and measuring the results.
This case was investigated by GBI and FBI.
Criminal Chief Leah McEwen prosecuted the case for the Government.
President of Rhode Island Trucking Company and Truck Computer Design Service, and Companies, Admit to Conspiring to Violate the Clean Air ActRead the Press Release
PROVIDENCE – The owner and President of a North Kingstown-based trucking company, along with his two corporations, all admitted to a federal judge in Providence today that they conspired together with trucking and diesel vehicle sales and service companies throughout the United States and with a foreign national to violate the Clean Air Act by selling and providing a software program that tampered with on-board computers in order to alter or bypass key features in emission control systems, announced United States Attorney Zachary A. Cunha.
Under the federal Clean Air Act, the Environmental Protection Agency (EPA) has established standards that limit the emission of air pollutants from various types of vehicle engines. To meet those standards, vehicle manufacturers design and install certain hardware components as part of the systems that manage and treat engine exhaust to reduce multiple types of pollution.
“Our environmental laws are here to protect the clean air that every Rhode Islander deserves to breathe,” said U.S. Attorney Zachary Cunha. “When companies choose to ignore those laws and put profit over their legal duties, and spew diesel soot and contaminants across Rhode Island and New England in the process, this Office will hold them to account.”
“Tampering with diesel vehicles by installing defeat devices increases emissions of smog and soot, both of which contribute to serious health problems that often disproportionately affect families, especially children, living in underserved communities,” stated Tyler Amon, Special Agent in Charge for EPA’s Criminal Investigation Division for New England. “Placing profit over public health in Rhode Island has clear accountability.”
According to court documents, from roughly September of 2014 through approximately August 27, 2019, Michael J. Collins, his North Kingstown company M&D Transportation, Inc.; his now-defunct computer company Diesel Tune-Ups of RI, Inc.; various trucking and diesel vehicle sales and repair companies throughout the United States; and a foreign national all conspired to alter or disable certain functions of the Electronic Control Modules (ECM) and On Board Diagnostic (OBD) monitoring systems of heavy-duty diesel vehicles such as semi-trucks or “big rigs.” These alterations were referred to in the industry as “tunes.”
In exchange for a fee, the foreign national would download tuning software through a laptop computer, provided by Collins and his companies, that was then connected to each vehicle. The tuning business was marketed on Facebook, with claims that it provided increased power and better fuel mileage and offered tuning for “BigRig semi-trucks & engines” including tuning related to emission control equipment. The Facebook page directed interested companies to contact a Rhode Island telephone number associated with Collins, M & D and Diesel Tune-Ups.
When tuning was done through a laptop computer, Collins instructed the Companies to call the foreign national for further instructions once they had received the laptop. Through a remote connection, the “tunes” were then downloaded onto each vehicle’s ECM or computer to reprogram the vehicle’s monitoring systems. The tunes tampered with the vehicle’s monitoring systems so that they would not detect malfunctions in the emission control components, thereby allowing vehicles to operate without proper emission controls. As a result, “tuned” vehicles could run with increased horsepower and torque, which can reduce maintenance and repair costs, but which results in significant increases in pollutant emissions. Often, installation of the “tunes” was undertaken in concert with diesel sales and service centers that were making other changes to trucks’ pollution control systems. Collins also employed the same techniques to circumvent emission controls on some of M & D's own diesel vehicles.
Customers paid Collins’ companies between $1,700 and $3,650 for each vehicle tuned. Collins and his companies wired a portion of the funds to their foreign co-conspirator and retained a portion of the funds for themselves. From at least March of 2017 through at least June 1, 2018, Collins either deposited or caused to be deposited into the Diesel Tune-Ups bank account fees received from approximately 25 different diesel trucking or repair shops throughout the United States.
According to court documents, diesel exhaust is known to contain a variety of air pollutants identified as hazardous air pollutants under the Clean Air Act. The act of completely removing or disabling a vehicle's emission control system can increase pollutant emissions, presenting a risk to the environment and public health. More recent testing conducted by EPA indicates that the pollutant increase is even greater when the emission controls are deleted from commercial semi-tractor trailer trucks.
Collins, M&D Transportation, and Diesel Tune Ups of RI pleaded guilty to conspiracy to violate the Clean Air Act. They are scheduled to be sentenced on July 10, 2023. The defendant’s sentence will be determined by United States District Judge Mary S. McElroy after consideration of the U.S. Sentencing Guidelines and other statutory factors.
The case is being prosecuted by Assistant United States Attorney John P. McAdams.
The matter was investigated by the Environmental Protection Agency Criminal Investigation Division - Boston Area Office.
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Possession of loaded weapons and multi-kilos of meth lands local in prison for three decadesRead the Press Release
HOUSTON – A 38-year-old Houstonian has been ordered to federal prison following his conviction of conspiracy to distribute meth during a drug transaction that occurred in an IKEA parking lot, announced U.S. Attorney Alamdar S. Hamdani.
Josue Daniel Casco pleaded guilty July 6, 2021.
Today, US District Judge Andrew Hanen sentenced Casco to a total of 360 months in federal prison to be immediately followed by five years of supervised release. The sentence represents enhancements to include attempting to evade arrest and putting authorities at risk. The court also ordered the forfeiture of the three and ammunition law enforcement had seized upon his arrest.
"This drug dealer showed no regard for human life when he brought 15 kilos of meth and three loaded guns to a local IKEA parking lot while local residents shopped,” said Hamdani. “He and his AR-15 holding partner in crime exposed our community to an extremely potent drug and could have caused more harm in a flagrant attempt to flee. Thanks to the quick and brave action of law enforcement and the subsequent prosecution, two dangerous criminals, along with their guns and meth, are off the streets.”
The undercover investigation began in September 2020, when authorities learned of a potential narcotics transaction via a Mexican phone number. Continued communication led to Casco, in Houston, agreeing to sell 15 kilograms of crystal meth for more than $100,000.
On Oct. 8, 2020, Casco drove a while Chevy Malibu to the IKEA on Katy Freeway in Houston. Co-defendant – Dante Nava, 39, Houston – was holding a loaded AR-15 style weapon in one hand as he leaned against a brown cardboard box which housed the drugs.
Authorities quickly moved to arrest both men. However, instead of complying with commands, Casco immediately accelerated and rammed into undercover law enforcement vehicles.
No one was injured.
At the time of the arrests, authorities found a loaded Glock 30 SF in the Nava’s waistband and another Glock 30 SF with fully loaded magazine on the front passenger seat. In total, they seized three weapons a total of 62 rounds of ammunition.
Nava also pleaded guilty and was previously sentenced.
Both men have been and will remain in custody.
The Drug Enforcement Administration, police departments in Pasadena and Houston and Harris County Sheriff’s Office conducted the investigation. Assistant U.S. Attorney (AUSA) Shelley J. Sullivan and former AUSA Ed Gallagher Sullivan prosecuted the case.
Owner of D.C.-area Tax Preparation Business Pleads Guilty to Tax Refund Fraud SchemeRead the Press Release
An Indiana woman pleaded guilty in federal court last Friday in the District of Columbia to conspiring to file false tax returns and related charges.
According to court documents and statements made in court, Awett Tedla of Indianapolis was the owner and operator of Speedy Tax Services, L.L.C., a tax preparation business in Washington, D.C., and District Heights, Maryland. From 2012 through 2016, Tedla and her coconspirators prepared and electronically filed with the IRS fraudulent returns on behalf of clients and illegally-obtained identities of unwitting taxpayers, claiming purported refunds were due. The false returns reported fictitious businesses and claimed certain tax credits in order to generate inflated tax refunds. Clients paid an increased fee depending on the size of the fraudulent refund.
Tedla also underreported business gross receipts and taxable income on her 2016 personal income tax return, and in total, evaded approximately $171,534 in income tax between 2013 through 2016.
She faces a maximum sentence of 20 years in prison for wire fraud, 10 years in prison for conspiring to file false claims, five years in prison for tax evasion and a mandatory sentence of two years in prison for aggravated identity theft. Tedla also faces a period of supervised release, restitution and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division made the announcement.
IRS-Criminal Investigation and the Treasury Inspector General for Tax Administration (TIGTA) are investigating the case.
Trial Attorneys Mark McDonald and George Meggali of the Justice Department’s Tax Division are prosecuting the case.
Orange County Pharmacist Sentenced to 15 Years in Federal Prison for Helping to Defraud U.S. Military’s Health Plan Out of $11.1 MillionRead the Press Release
LOS ANGELES – A licensed Orange County pharmacist was sentenced today to 180 months in federal prison for her role in a health care fraud scheme in which more than 1,000 bogus prescriptions for compounded medications were filled, costing Tricare, the United States military’s health care plan, more than $11 million in losses.
Sandy Mai Trang Nguyen, 42, of Irvine, was sentenced by United States District Judge Otis D. Wright II, who also ordered her to pay $11,098,756 in restitution.
At the conclusion of a five-day trial in November 2022, a jury found Nguyen guilty of 21 counts of health care fraud, and one count of obstruction of a federal audit.
Nguyen was the pharmacist-in-charge of the now-defunct Irvine Wellness Pharmacy (IWP) in Irvine. From late 2014 to May 2015, Nguyen and others under her supervision filled approximately 1,150 compounded prescriptions for pain, scarring and migraines that Tricare reimbursed for tens of thousands of dollars per prescription. Nearly all the prescriptions were sent to the pharmacy by so-called marketers who were paid kickbacks of upwards of 50% of the Tricare reimbursements.
Compounded drugs are tailor-made products doctors may prescribe when the Food and Drug Administration-approved alternative does not meet the health needs of a patient.
The beneficiaries were solicited to provide their Tricare insurance information for medications they did not seek out or need, and most were never examined by a physician. The prescriptions were electronically sent from marketers or telemedicine businesses and submitted by the pharmacy for reimbursement even though Tricare rules excluded reimbursements for claims based on telemedicine visits and would not, in any event, have authorized reimbursements for prescriptions obtained through the payment of kickbacks.
Nguyen was aware that the prescriptions – purportedly tailored to individual patients’ needs – were purportedly written by physicians in states other than where the beneficiaries lived, multiple members of the same families received the same medications, and the same prescriptions were written for members of different patient populations, including a 13-year-old boy in Chicago who got the same prescription as a woman in Orange County who happened to be Nguyen’s grandmother.
The pharmacy invoiced the beneficiaries to pay hundreds of dollars in required co-payments, but the beneficiaries stated that they knew nothing about co-payments and understood that the medications were fully covered by Tricare, according to trial testimony. The total co-payments due during the scheme exceeded $16,000, but the pharmacy never collected them.
Nguyen also obstructed a federal audit by providing bogus, cut-and-pasted prescriptions to frustrate Tricare’s effort to validate millions of dollars paid for the same prescriptions.
During Nguyen’s tenure as pharmacist-in-charge, Tricare paid $11,098,756 on the fraudulently submitted claims.
“At [Nguyen’s] trial, the government proved that [Nguyen] knew that IWP was, essentially, a fraud factory that was churning out prescriptions solely to make a fast buck,” prosecutors argued in a sentencing memorandum. “She routinely ignored the numerous red flags that indicated that the prescriptions were fraudulent.”
On March 20, Judge Wright sentenced co-defendant Marcus Orlando Armstrong, 56, of Miami, to 9½ years in federal prison for his role in the scheme to defraud Tricare. Armstrong was IWP’s director of operations when the criminal activity occurred.
Co-defendants Leslie Andre Ezidore, 53, of West Los Angeles, and Alexander Michael Semenik, 51, of Las Vegas, have pleaded guilty to felony charges in this case and await sentencing.
The Department of Defense Office of Inspector General; the Defense Criminal investigative Service; the FBI; the Amtrak Office of Inspector General; IRS Criminal Investigation; the United States Department of Labor – Employee Benefits Security Administration; the California Department of Insurance; and the Office of Personnel Management Office of Inspector General investigated this matter.
Assistant United States Attorneys Mark R. Aveis and Ali Moghaddas of the Major Frauds Section are prosecuting this case.
Ohio Woman Pleads Guilty to Federal Drug CrimeRead the Press Release
HUNTINGTON, W.Va. – Judy Ann Goodman, also known as Judy Ann Eplion, 32, of Chesapeake, Ohio, pleaded guilty today to conspiracy to distribute suboxone and methamphetamine.
According to court documents and statements made in court, on October 6, 2022, Goodman conspired with Western Regional Jail inmate Corey Michael Perkins during phone calls to assist the smuggling of a package of suboxone and methamphetamine into the jail. The phone calls were recorded by the West Virginia Division of Corrections and Rehabilitation. Goodman admitted that she helped to pay a woman working at the jail to transport the drugs into the jail. Goodman further admitted that Perkins instructed her on what to do with the package and arranged a meeting between Goodman and the jail worker.
Investigators intercepted the package when the jail worker attempted to deliver it. Goodman admitted that the package contained 126 Suboxone strips and approximately 7.3 grams of suspected methamphetamine. The West Virginia State Police Forensic Laboratory confirmed that the controlled substances were buprenorphine and 6.8 grams of methamphetamine.
Goodman is scheduled to be sentenced on July 5, 2023, and faces a maximum penalty of 20 years in prison, three years of supervised release, and a $1 million fine.
The jail worker, Bryanna Danielle Kern, 25, of Proctorville, Ohio, pleaded guilty to conspiracy to distribute suboxone and is scheduled to be sentenced on May 22, 2023. The indictment remains pending against the inmate, Perkins. 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 Attorney Will Thompson made the announcement and commended the investigative work of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the West Virginia Division of Corrections and Rehabilitation Investigations Unit, the West Virginia State Police, and the Huntington Police Department.
United States District Judge Robert C. Chamber presided over the hearing. Assistant United States Attorney Ryan A. Keefe is prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 3:22-cr-220.
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Nurse Practitioner Convicted of Opioid Distribution ConspiracyRead the Press Release
WASHINGTON – A federal jury convicted a Tennessee nurse practitioner last week for illegally prescribing opioids – including oxycodone and fentanyl – from his medical practice.
According to court documents and evidence presented at trial, Jeffrey Young, 49, of Jackson, used his medical practice, Preventagenix, to illegally prescribe more than one million medically unnecessary controlled substance pills to hundreds of patients, including a pregnant woman and women with whom he was having inappropriate physical relationships. Young maintained a party-like atmosphere at his clinic, and prescribed these drugs at least in part to boost his popularity on social media and promote a self-produced reality TV show pilot based on his self-identified persona, the “Rock Doc.”
Young was convicted of conspiracy to unlawfully distribute controlled substances, maintaining a drug-involved premises, and 13 counts of distributing controlled substances, six of which involved distribution to a pregnant woman. He is scheduled to be sentenced on Aug. 3 and faces a maximum penalty of 40 years in prison for each count involving distribution to a pregnant woman, and 20 years in prison for each of the other counts of conviction. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, U.S. Attorney Kevin G. Ritz for the Western District of Tennessee, Special Agent in Charge J. Todd Scott of the DEA Louisville Field Division, and Director David Rausch of the Tennessee Bureau of Investigation made the announcement.
The DEA and Tennessee Bureau of Investigation investigated the case, with valuable assistance from the Jackson Police Department.
Assistant Chief Kate Payerle and Trial Attorney Drew Pennebaker of the Criminal Division’s Fraud Section are prosecuting the case with significant assistance from Jillian Willis and Dermot Lynch.
The Fraud Section leads the Appalachian Regional Prescription Opioid (ARPO) Strike Force. Since its inception in late 2018, ARPO has partnered with federal and state law enforcement agencies and U.S. Attorneys’ Offices throughout Alabama, Kentucky, Ohio, Virginia, Tennessee, and West Virginia to prosecute medical professionals and others involved in the illegal prescription and distribution of opioids. Over the past four years, ARPO has charged over 115 defendants, collectively responsible for issuing prescriptions for over 115 million controlled substance dosage units. To date, more than 70 ARPO defendants have been convicted. More information can be found at https://www.justice.gov/criminal-fraud/health-care-fraud-unit.
Nurse Practitioner Convicted of Opioid Distribution ConspiracyRead the Press Release
A federal jury convicted a Tennessee nurse practitioner last week for illegally prescribing opioids – including oxycodone and fentanyl – from his medical practice.
According to court documents and evidence presented at trial, Jeffrey Young, 49, of Jackson, used his medical practice, Preventagenix, to illegally prescribe more than one million medically unnecessary controlled substance pills to hundreds of patients, including a pregnant woman and women with whom he was having inappropriate physical relationships. Young maintained a party-like atmosphere at his clinic, and prescribed these drugs at least in part to boost his popularity on social media and promote a self-produced reality TV show pilot based on his self-identified persona, the “Rock Doc.”
Young was convicted of conspiracy to unlawfully distribute controlled substances, maintaining a drug-involved premises, and 13 counts of distributing controlled substances, six of which involved distribution to a pregnant woman. He is scheduled to be sentenced on Aug. 3 and faces a maximum penalty of 40 years in prison for each count involving distribution to a pregnant woman, and 20 years in prison for each of the other counts of conviction. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, U.S. Attorney Kevin G. Ritz for the Western District of Tennessee, Special Agent in Charge J. Todd Scott of the DEA Louisville Field Division, and Director David Rausch of the Tennessee Bureau of Investigation made the announcement.
The DEA and Tennessee Bureau of Investigation investigated the case, with valuable assistance from the Jackson Police Department.
Assistant Chief Kate Payerle and Trial Attorney Drew Pennebaker of the Criminal Division’s Fraud Section are prosecuting the case with significant assistance from Jillian Willis and Dermot Lynch.
The Fraud Section leads the Appalachian Regional Prescription Opioid (ARPO) Strike Force. Since its inception in late 2018, ARPO has partnered with federal and state law enforcement agencies and U.S. Attorneys’ Offices throughout Alabama, Kentucky, Ohio, Virginia, Tennessee, and West Virginia to prosecute medical professionals and others involved in the illegal prescription and distribution of opioids. Over the past four years, ARPO has charged over 115 defendants, collectively responsible for issuing prescriptions for over 115 million controlled substance dosage units. To date, more than 70 ARPO defendants have been convicted. More information can be found at https://www.justice.gov/criminal-fraud/health-care-fraud-unit.
Nevada Attorney Indicted in Multimillion-Dollar Ponzi SchemeRead the Press Release
LAS VEGAS – A Las Vegas attorney made his initial appearance on March 31, 2023, before U.S. Magistrate Judge Elayna J. Youchah for allegedly orchestrating a Ponzi scheme causing more than 1,000 victim-investors to part with more than $460 million.
A federal grand jury returned the indictment on March 29, 2023, charging Matthew Wade Beasley (50) with five counts of wire fraud and three counts of money laundering. A detention hearing was scheduled for April 7, 2023, before U.S. Magistrate Judge Cam Ferenbach. A jury trial was scheduled for June 6, 2023, before U.S. District Judge Jennifer A. Dorsey.
According to allegations contained in the indictment, from about 2017 to March 2022, Beasley falsely represented to another person that he could find plaintiffs in personal injury lawsuits who wanted to borrow money against their pending settlements and would pay high interest rates to do so. He created fake contracts to lend money to purported personal injury plaintiffs. Beasley caused others to find investors to invest in these fake contracts.
The indictment further alleges that, Beasley caused victim investors to wire transfer their investments to Beasley’s IOLTA account, which is a bank account set up by an attorney to hold client monies. He used the money from the scheme to buy luxury homes, cars, and recreational vehicles.
“This indictment alleges the defendant devised and orchestrated a large-scale, multimillion-dollar Ponzi scheme with thousands of victims across the country,” said United States Attorney Jason M. Frierson for the District of Nevada. “While the allegations are intolerable regardless of the defendant’s position, they are even more egregious when considering defendant’s position of trust as an attorney. The U.S. Attorney’s Office will continue to work closely with our law enforcement partners to pursue, investigate, and prosecute individuals who lure victims with a false promise and take advantage for their personal benefit.”
“Investment fraud can be crippling for its victims, with life savings obliterated in a flash,” said Special Agent in Charge Spencer L. Evans for the FBI. “The defendant used fraudulent means to mislead multiple victims into believing they were investing in legitimate legal contracts. The FBI is committed to identifying and working with anyone impacted by this brazen scheme. This indictment is only one piece of an ongoing investigation. We will continue to follow the facts and pursue anyone who seeks to defraud others through deceptive and illegal practices.”
If convicted, Beasley faces up to 160 years in prison and fines up to $2,750,000 or twice the value of property involved in the scheme, whichever is greater. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The FBI and IRS Criminal Investigation are investigating the case. Assistant United States Attorneys Daniel R. Schiess and Eric Schmale are prosecuting the case.
An indictment is merely an allegation, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
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Morris County Company Settles Matter Alleging it Received Improper Paycheck Protection Program LoanRead the Press Release
NEWARK, N.J. – A Morris County public relations firm entered into a settlement agreement with the United States resolving allegations that the company violated the False Claims Act by taking a loan from the Paycheck Protection Program (PPP) to which the company was not entitled, U.S. Attorney Philip R. Sellinger announced today.
Congress created the PPP in March 2020, as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, to provide emergency financial support to the millions of Americans suffering the economic effects caused by the COVID-19 pandemic. The CARES Act authorized billions of dollars in forgivable loans to small businesses struggling to pay employees and other business expenses.
According to the allegations in the complaint and the contentions of the United States in the settlement agreement:
Coyne Public Relations LLC (Coyne) knowingly applied for and received a PPP loan totaling $2 million, even though it was ineligible for such a loan because it was a required registrant under the Foreign Agent Registration Act (FARA). Coyne thereafter sought and received forgiveness of the total amount of the loan.
Coyne fully cooperated in the investigation and resolution of this matter. In accordance with the terms of the settlement Coyne agrees to pay the United States $2.24 million. The settlement resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties, called relators, to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. In this matter, the relator is receiving $203,183 as his share in the recovery.
U.S. Attorney Sellinger credited special agents of the Small Business Administration, Office of Inspector General, under the direction of Supervisory Criminal Investigator Angelo Palmeri in New York, with the investigation.
The government is represented by Assistant U.S. Attorney David E. Dauenheimer of the Healthcare Fraud Unit in Newark.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
The qui tam case is captioned United States ex rel. GNGH2 Inc. v. Coyne Public Relations, LLC, 21-cv-20442 (D.N.J.).
coyne.settlement.pdfMoney from Debt Elimination Services Fraud Scheme Successfully Forfeited and Returned to VictimRead the Press Release
GRAND RAPIDS, MICHIGAN —U.S. Attorney Mark Totten today announced the civil forfeiture and return of over $79,000 that was stolen from an individual victimized by a “debt elimination services” scam. This is the latest public action by the U.S. Attorney’s Office in its ongoing efforts to combat fraudsters who seek to financially exploit vulnerable individuals.
“Scams, including fraudulent promises to eliminate debt, are everywhere and can financially ruin unsuspecting victims. Be aware: if something sounds too good to be true, it’s probably a scam,” said U.S. Attorney Totten. “Thankfully, due to the hard work of the FBI, the fraud in this case was detected quickly and all lost funds were returned to the victim. Working with our law enforcement partners, we will continue to use every available tool to ensure fraudsters don’t benefit from their crimes.”
Criminal organizations engage in a variety of scams with the intention of convincing unwitting victims to send money to locations or bank accounts based in the United States or overseas. One type of scam involves purported debt elimination services, where the fraudsters offer to pay off the victim’s debt obligations for an upfront fee that is considerably less than the underlying debt. The fraudsters induce the victims by paying off small increments of debt in the beginning to gain trust, and eventually, the victims pay larger upfront fees while the underlying debt remains unpaid.
“The victim in this case lost more than $79,000 in a debt elimination scam, one of many types of scams criminals use to separate people from their hard-earned money,” said James A. Tarasca, Special Agent in Charge of the FBI in Michigan. “The return of those funds would not have been achievable without the cooperative efforts of FBI agents and federal prosecutors in the Western District of Michigan. Forfeiture of ill-gotten gains not only takes money from criminals, but it is among our most powerful tools to make victims whole.”
According to allegations contained in the civil forfeiture complaint filed in U.S. District Court (attached), in September 2021, fraudsters contacted the victim by phone, offering a debt elimination service, which was a scam. Throughout the scam, the victim made upfront “fee payments” that totaled $79,760, while the victim’s underlying debt was never paid off. Following an investigation, these fraud proceeds were seized by the FBI from various bank accounts, forfeited to the United States, and ultimately returned to the victim.
The U.S. Attorney’s Office continues to combat financial fraud schemes against vulnerable victims, including the elderly, by expanding efforts to investigate and promote coordination with law enforcement partners, and by seizing fraud proceeds through federal forfeiture laws.
In addition to debt elimination service fraud, some well-known examples of financial scams targeting seniors and other vulnerable populations are:
- Lottery phone scams: fraudsters persuade victims that a large fee or tax must be paid before they can receive lottery winnings.
- Grandparent scams: fraudsters convince elderly victims that their grandchildren are in trouble and need money to pay rent, repair a car, or make bail.
- Romance scams: scammers lull victims into believing that they are in a romantic relationship and that the scammers need money to travel to the U.S. or for some other seemingly legitimate purpose.
- IRS or government imposter scams: fraudsters pose as IRS or other government officials that claim the victims owe the government money.
- Sham business opportunities: fraudsters convince victims to invest in lucrative business opportunities or investments.
To avoid falling victim to financial scams:
- Don’t share personal information with anyone you don’t know.
- Don’t send money or pay upfront fees to obtain some greater financial benefit down the road. Remember, it’s not rude to say, “No.”
- If you are unsure about contact you receive from a potential fraudster, take the time to talk to a trusted family member or friend before you do anything.
If you have been contacted by a fraudster, or believe you have fallen victim to a scam, please file a report with the Justice Department’s Elder Fraud Hotline at 1-833-Fraud-11, the Federal Trade Commission (FTC) via their website or by calling 877-FTC-HELP, or the FBI, for law enforcement action, at https://tips.fbi.gov/.
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Michigan Man Pleads Guilty to Illegal Possession of a Firearm After a High-Speed Pursuit with an Iowa State TrooperRead the Press Release
Ahmed Abdullahai Khalif, 23, from Owosso, Michigan, pled guilty on March 30, 2023, to being a prohibited person in possession of a firearm. Khalif was a user of marijuana and was previously convicted of felony Illegal Sale/Use of a Financial Transaction Device in Michigan. Both prohibit a person from possessing a firearm.
At the plea hearing, defendant admitted that on October 19, 2022, during a traffic stop, he possessed a 9mm Taurus pistol and marijuana while being a felon. Prior to the traffic stop, an Iowa State Patrol trooper clocked the vehicle defendant was driving traveling in excess of 100 mph. After the trooper activated his emergency lights, Khalif led the trooper on a high-speed pursuit into Wright County, at times traveling toward oncoming traffic. Ultimately, the defendant hit the trooper’s vehicle, and defendant fled on foot a short distance before being apprehended. The vehicle defendant was driving was stolen in Massachusetts. During a search of the vehicle, law enforcement found the 9mm Taurus pistol and marijuana. In addition to the federal conviction for the firearm possession, defendant was convicted in Iowa District Court for Wright County with felony Eluding, Theft 2nd Degree, Assault on Persons in Certain Occupations, Possession Marijuana, and Operating While Under the Influence.
Sentencing before United States District Court Chief Judge Leonard T. Strand will be set after a presentence report is prepared. Khalif remains in custody of the United States Marshal pending sentencing. Khalif faces a possible maximum sentence of 15 years’ imprisonment, a $250,000 fine, and not more than three years of supervised release following any imprisonment.
This case was brought as part of Project Safe Neighborhoods (PSN). PSN is 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.
The case is being prosecuted by Assistant United States Attorney Patrick T. Greenwood and was investigated by the Iowa Division of Narcotics Enforcement, Iowa State Patrol, Iowa DCI, and the Bureau of Alcohol, Tobacco, Firearms, and Explosives.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 22-3035. Follow us on Twitter @USAO_NDIA.
Mexican National Sentenced for Meth ConspiracyRead the Press Release
KANSAS CITY, Mo. – A Mexican national was sentenced in federal court today after a Missouri State Highway Patrol trooper found more than 88 pounds (40 kilograms) of methamphetamine and a firearm during a car stop on Interstate 70 in Saline County, Mo.
Jose Alfredo Renteria-Rojas, 34, who was residing in Des Plaines, Illinois, was sentenced by U.S. District Chief Judge Beth Phillips to 11 years and six months in federal prison without parole.
On Oct. 25, 2022, Renteria-Rojas pleaded guilty to one count of conspiracy to distribute methamphetamine and one count of using a firearm in furtherance of a drug-trafficking crime.
Renteria-Rojas was a passenger in a white 2011 Volkswagen Jetta SE being driven by his brother, co-defendant Gustavo Renteria-Rojas, 39, a citizen of Mexico residing in Evanston, Ill., on April 5, 2021. Their car was stopped by a Missouri State Highway Patrol trooper on eastbound I-70 in Saline County, Mo. The trooper could smell the odor of burnt and raw marijuana emanating from the vehicle as he stood outside the front passenger-side window. He also noticed a marijuana blunt in the center console. When Gustavo Renteria-Rojas opened the glove box to retrieve the requested paperwork, a bag of marijuana was visible in plain view.
Gustavo Renteria-Rojas was placed in the trooper’s patrol car. The trooper requested Jose Renteria-Rojas, in the rear passenger seat, to exit the vehicle for a vehicle search. As Jose Renteria-Rojas did so, air fresheners fell from the car. Jose Renteria-Rojas then collected them and put them in the door pocket, which also contained a loaded Smith & Wesson .380-caliber handgun with a magazine, as well as an extra magazine.
The trooper searched the vehicle and found four white cardboard boxes in the trunk that contained 36 packages with a total of 88.7 pounds of methamphetamine. The trooper also found a methamphetamine smoking pipe concealed within a roll of toilet paper on the driver’s seat where Gustavo Renteria-Rojas had been sitting.
Gustavo Renteria-Rojas pleaded guilty to the same charges on Oct 13, 2022, and will be sentenced on April 6, 2023.
This case is being prosecuted by Assistant U.S. Attorney Bruce Rhoades. It was investigated by the Drug Enforcement Administration and the Missouri State Highway Patrol.
Maryland Woman Pleads Guilty to Conspiring to Defraud the GovernmentRead the Press Release
BOSTON – A Maryland woman pleaded guilty today in federal court in Boston to her role in a conspiracy to defraud the government of thousands of dollars from 2014 to 2018.
Chantelle Boyd, 53, of Woodsboro, Md., pleaded guilty to one count of conspiracy, 10 counts of theft of government funds and false declarations before the grand jury. U.S. Senior District Court Judge Mark L. Wolf scheduled sentencing for June 26, 2023. Boyd was arrested and charged in July 2020 along with co-defendant Thomas Bouchard.
Bouchard was the Contracting Officer in charge of the U.S. Army Natick Contracting Division, a full-service contracting organization for the Department of Defense. According to the charging documents, in 2014, Bouchard used his long-standing relationship with Evolution Enterprise, Inc., a government contractor, to have Boyd hired for a “no show” job as an assistant that specifically supported Bouchard. Boyd’s position cost the Department of Defense more than $490,000 during her time at Evolution from 2014 to 2018, during which Boyd performed little if any useful function.
Bouchard and Boyd took numerous government-funded trips, ranging in duration from two to 15 days, under the guise that they were work related. This included 31 trips to Orlando, Fla., among other locations such as Clearwater Beach, Fla., and Stafford, Va., during which Boyd allegedly performed little if any work. For many of the trips, Bouchard and Boyd stayed in the same hotel room and spent time at the pool and Disney parks – all during business hours. In order to conceal the personal nature of the trips, Bouchard altered, created and approved false travel to reimburse the Boyd for out-of-pocket expenses. Additionally, Boyd made false statements to the grand jury in May 2018 in relation to these trips.The charge of conspiracy provides a sentence of up to five years in prison, three years of supervised release and a fine of $250,000. The charges of theft of government funds each provide for a sentence of up to 10 years in prison, three years of supervised release and a fine of $250,000. The charge of lying to a grand jury provides a sentence of up to five 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.
United States Attorney Rachael S. Rollins; Joseph Dattoria, Special Agent in Charge of the General Services Administration Office of Inspector General; Patrick Hegarty, Special Agent in Charge of the Defense Criminal Investigative Service; and Scott Moreland, Special Agent in Charge of the Army Criminal Investigation Division Major Procurement Fraud Field Office made the announcement. Assistant U.S. Attorney Neil J. Gallagher, Jr. of Rollins’ Public Corruption & Special Prosecutions Unit is prosecuting the case.
The details contained in the charging documents are allegations. The remaining defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Man to Federal Prison for over 11 Years for Illegal Possession of Stolen FirearmsRead the Press Release
A man who illegally possessed firearms that were stolen was sentenced on March 30, 2023, in federal court in Sioux City to over 11 years in federal prison.
Logan Rhinehart, 27, from Fairfield, Iowa, pled guilty on November 16, 2022, to one count of prohibited person in possession of a firearm and one count of possession of a stolen firearm.
At the plea and sentencing hearings, evidence showed that Rhinehart was previously convicted of felony burglary, escape and theft. These convictions prohibit a person from possessing any firearm. Evidence showed that on January 13, 2022, law enforcement located a stolen .22 caliber firearm under circumstances which indicated it had been stolen by Rhinehart. On January 28, 2022, law enforcement attempted to pull Rhinehart over when they observed him driving a stolen vehicle. As law enforcement attempted to stop the vehicle, Rhinehart attempted to flee driving at a high rate of speed (113+ mph) and the vehicle ended up crashing into a snow drift. Rhinehart then attempted to flee on foot before apprehended by law enforcement. During the attempted flight Rhinehart threw a 40 caliber pistol, which was also stolen, out of the vehicle which was later recovered from the scene. Further evidence showed that from between January 13, 2022 and January 28, 2022, Rhinehart burglarized two separate homes and stole numerous items, including two firearms.
Sentencing was held before United States District Court Chief Judge Leonard T. Strand. Rhinehart was sentenced to 136 months’ imprisonment and must serve a three-year term of supervised release following imprisonment. There is no parole in the federal system. Rhinehart remains in custody of the United States Marshal until he can be transported to a federal prison.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
The case was prosecuted by Assistant United States Attorney Shawn S. Wehde and was investigated by the Wright County Sheriff’s Office, Franklin County Sheriff’s Office, and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 22-3008. Follow us on Twitter @USAO_NDIA.
Man Pleads Guilty to Distributing HeroinRead the Press Release
A man who distributed heroin in Dubuque, Iowa, plead guilty on March 30, 2023.
John A. Pruitt, age 39, formerly of Dubuque, was convicted of distribution of heroin.
In a plea agreement, Pruitt admitted to distributing heroin in the Dubuque area. In the fall of 2021, Pruitt was stopped by Dubuque police officers because he had three active arrest warrants. During the stop, officers recovered a distribution quantity of heroin from Pruitt’s person and from the floorboard area, where he was reaching during the stop.
Sentencing before United States District Court Judge C.J. Williams will be set after a presentence report is prepared. Pruitt remains in custody of the United States Marshal pending sentencing. Pruitt faces a possible maximum sentence of 20 years’ imprisonment, a fine of not more than $1 million, and of at least three years and up to a lifetime of supervised release.
This case was investigated by the Dubuque Drug Task Force and is being prosecuted by Assistant United States Attorney Jason D. Norwood.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 22-CR-1030-CJW.
Follow us on Twitter @USAO_NDIA.
Man Pleads Guilty to $3.1M Medicare Fraud SchemeRead the Press Release
A Southern California man pleaded guilty today to submitting false enrollment applications to Medicare that hid the real owners of a fraudulent hospice company, which then submitted over $3.1 million in false and fraudulent claims to Medicare.
According to court documents, Karen Sarkisyan, aka Kevin Sarkisyan, 44, of Glendale, submitted false and fraudulent Medicare enrollment forms for San Gabriel Hospice and Palliative Care Inc. (San Gabriel), falsely identifying a straw owner as the sole owner and manager, concealing the actual beneficial owners and managers. San Gabriel submitted approximately $3,668,050 in false and fraudulent claims to Medicare, of which $3,180,677 was paid after Sarkisyan submitted the false enrollment applications.
Sarkisyan pleaded guilty to one count of conspiracy to defraud the United States. He is scheduled to be sentenced on Sept. 11 and faces a maximum penalty of five years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Co-conspirator Gayk Akhsharumov previously pleaded guilty to health care fraud conspiracy and is scheduled to be sentenced on Aug. 14. A third co-conspirator was indicted for his role in the scheme but remains a fugitive.
Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, U.S. Attorney Martin Estrada for the Central District of California, Assistant Director in Charge Donald Always of the FBI Los Angeles Field Office, and Special Agent in Charge Timothy B. DeFrancesca of the Department of Health and Human Services Office of Inspector General (HHS-OIG) made the announcement.
The FBI Los Angeles Field Office and HHS-OIG are investigating the case.
Assistant Chief Niall M. O’Donnell and Trial Attorneys Patrick J. Queenan and Alexandra Michael of the Criminal Division’s Fraud Section are prosecuting the case.
The Fraud Section leads the Criminal Division’s efforts to combat health care fraud through the Health Care Fraud Strike Force Program. Since March 2007, this program, comprised of 15 strike forces operating in 25 federal districts, has charged more than 5,000 defendants who collectively have billed federal health care programs and private insurers more than $24 billion. In addition, the Centers for Medicare & Medicaid Services, working in conjunction with the Office of the Inspector General for the Department of Health and Human Services, are taking steps to hold providers accountable for their involvement in health care fraud schemes. More information can be found at https://www.justice.gov/criminal-fraud/health-care-fraud-unit.
Lawrence Man Sentenced for Identity Theft, Social Security and Passport FraudRead the Press Release
BOSTON – A Lawrence man was sentenced today in federal court in Boston for stealing the identity of a United States citizen to fraudulently obtain a United States passport.
Arciliano Gregorio Arias Suarez, 65, was sentenced by U.S. District Court Judge Leo T. Sorokin to two years and one day in prison and two years of supervised release. In November 2022, Arias Suarez pleaded guilty to one count of aggravated identity theft, one count of false representation of a Social Security number and one count of passport fraud.
In January 2016, Arias Suarez submitted a U.S. passport application at a post office in Lawrence in the name of a United States citizen from New York. In support of the fraudulent passport application, Aris Suarez submitted copies of a Massachusetts driver’s license and a New York birth certificate, both in the victim’s name. Later, in May 2019, Aris Suarez submitted a license renewal application at the Lawrence Registry of Motor Vehicles (RMV) in the name of the same victim and provided the RMV with a copy of a U.S. passport, a Massachusetts driver’s license and a Social Security card all in the victim’s name.
Arias Suarez has two prior federal heroin related convictions in the District of Massachusetts. He was sentenced to federal prison in both of those cases.
United States Attorney Rachael S. Rollins and Michael J. Krol, Acting Special Agent in Charge of Homeland Security Investigations in New England made the announcement. Assistant U.S. Attorney David G. Tobin of Rollins’ Major Crimes Unit prosecuted the case.
Lawrence Man Sentenced for Drug TraffickingRead the Press Release
CONCORD – A Lawrence man was sentenced today in federal court in Concord for possession with intent to distribute controlled substances.
Daniel Adorno, Jr., 28, was sentenced by U.S. District Court Judge Paul J. Barbadoro to 41 months in prison and 3 years of supervised release. Adorno pleaded guilty to the charge on January 11, 2022.
“The U.S. Attorney’s Office is committed to working closely with our law enforcement partners to identify and prosecute drug dealers,” said U.S. Attorney Jane E. Young. “In this case, the Salem Police Department successfully stopped the flow of fentanyl, cocaine, and methamphetamine from endangering their community.”
On November 13, 2019, a Salem Police Officer encountered Adorno during a routine motor vehicle stop that resulted in the arrest of the driver and impoundment of the vehicle. During the pre-tow inventory search of the vehicle, officers located Adorno’s backpack containing cocaine, cocaine base, and methamphetamine. Adorno admitted that the drugs in the backpack belonged to him and that he distributed drugs.
On May 15, 2020, the same Salem Police Officer recognized Adorno as he was driving away from a hotel. Adorno had a suspended license and had an active warrant for the November 2019 encounter at the time. The officer stopped Adorno to arrest him for the outstanding warrant. Adorno admitted that he possessed drugs and had more in his hotel room. The officer located 9 baggies of fentanyl from Adorno’s pockets. Officers attempted to recover the drugs from Adorno’s hotel room, but they learned that the defendant’s sister had removed and concealed the drugs in a bush next to the hotel room. Officers recovered approximately 174.89 grams of fentanyl during their search of the area.
United States Attorney Jane E. Young made the announcement today. This case was prosecuted by former Assistant U.S. Attorney Joachim H. Barth and Assistant U.S. Attorney Cam T. Le
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Las Vegas Woman Sentenced to Prison for Conspiracy to Distribute MethamphetamineRead the Press Release
LAS VEGAS – A Las Vegas woman was sentenced today by U.S. District Judge Cristina D. Silva to 65 months in prison followed by five years of supervised release for conspiring with others to distribute methamphetamine.
Adeline Coronel (31) pleaded guilty in December 2022 to conspiracy to distribute a controlled substance – methamphetamine.
According to court documents, in September and October 2021, Coronel conspired with co-defendant Melinda Rodriguez and others to sell and possess with the intent to sell 2.1 kilograms of methamphetamine. Coronel arranged and negotiated the sale of drugs, and on one occasion she drove from California to Las Vegas to sell about three pounds of methamphetamine. Additionally, she admitted to working with individuals in Mexico to smuggle the drugs into the United States.
United States Attorney Jason M. Frierson for the District of Nevada and Assistant Special Agent in Charge Kevin Adams for the Drug Enforcement Administration (DEA) Las Vegas District Office made the announcement.
Rodriguez pleaded guilty to conspiracy to distribute a controlled substance - methamphetamine and she was sentenced to 96 months in prison.
The DEA investigated the case. Assistant United States Attorney Allison Reese prosecuted the case.
If you have information of a potential violation of controlled substances laws and regulations, including the growing, manufacture, distribution or trafficking of controlled substances, please contact the DEA at https://www.dea.gov/submit-tip.
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Keene Man Charged for Threatening to Kill a Member of CongressRead the Press Release
CONCORD – A man attending Keene State College has been charged for calling the office of a member of the United States House of Representatives and threatening to kill the Congressman.
Allan Poller, 23, was charged with transmitting in interstate commerce a threat to injure the person of another. Poller made an initial appearance in federal court in Concord on April 3, 2023 at 3:00 p.m.
According to the charging documents, on March 29, 2023 at approximately 12:20 a.m., Poller called the congressional office in Washington DC and left a voicemail, stating:
"Hi, my name is Allan Poller, A-L-L-A-N P-O-L-L-E-R, phone number []8931. And I just want to let you know, Representative [Name], if you keep on coming for the gays, we’re gonna strike back and I guarantee you, you do not want to fuck with us. We will kill you if that’s what it takes. I will take a bullet to your fucking head if you fuck with my rights anymore. And then if you want to keep going down that path, you know who’s next."
The charge provides for a sentence of up to five years in prison, up to three years of supervised release, and a fine of up to $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and statutes which govern the determination of a sentence in a criminal case.
United States Attorney Jane E. Young; the Federal Bureau of Investigation, Boston Division; and the United States Capitol Police made the announcement today. Valuable assistance was provided by the Keene, New Hampshire Police Department and the Springfield, Vermont Police Department. Assistant U.S. Attorney Jarad E. Hodes is prosecuting the case.
The details contained in the charging documents are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
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Justice Dept. Seizes over $112M in Funds Linked to Cryptocurrency Investment Schemes, with over Half Seized in Los Angeles CaseRead the Press Release
LOS ANGELES – The Department of Justice announced today that it has seized virtual currency worth an estimated $112 million linked to cryptocurrency investment scams commonly called “pig butchering.”
Seizure warrants for six virtual currency accounts were authorized by judges in Los Angeles, the District of Arizona, and the District of Idaho. In the Los Angeles matter, a United States magistrate judge authorized the seizure of an account containing approximately $66.4 million in various cryptocurrencies after finding probable cause that the funds were derived from wire fraud schemes.
According to court documents, the six virtual currency accounts were used to launder proceeds of various cryptocurrency confidence scams. In these schemes, fraudsters cultivated long-term, online relationships with victims, eventually enticing them to make investments in fraudulent cryptocurrency trading platforms. In reality, the funds sent by victims for these purported investments were instead funneled to cryptocurrency addresses and accounts controlled by scammers and their co-conspirators.
“The victims in Pig Butchering schemes are referred to as ‘pigs’ by the scammers because the scammers will use elaborate storylines to ‘fatten up’ victims into believing they are in a romantic or otherwise close personal relationship,” according to the affidavit in support of the Los Angeles seizure warrant. “Once the victim places enough trust in the scammer, the scammer brings the victim into a cryptocurrency investment scheme.”
The scammer attempts to create the appearance of legitimacy by fabricating websites or mobile apps to display a bogus investment portfolio with large returns, the affidavit states. In relation to the Los Angeles-based account seizure, the FBI has identified at least 10 victims who were unable to withdraw funds they had invested, with the seized account containing some funds from all 10 victims.
Authorities executed the Los Angeles seizure warrant in December and received the last transfer of cryptocurrency on March 21.
“Using the methods of traditional con artists, high-tech fraudsters have taken advantage of the publicity and hype surrounding cryptocurrency to encourage an untold number of Americans to invest in get-rich-quick schemes,” said United States Attorney Martin Estrada. “We all know that investment scams are not new, but the use of digital currency to commit fraud presents new challenges to victims and to law enforcement trying to recover lost funds – which likely total billions of dollars in the so-called ‘pig butchering’ schemes. The major seizures announced today show that law enforcement is confronting the new challenges and taking strong measures to address this fraud, but the public should be extremely wary of investment scams that use cryptocurrency and promise unrealistic returns.”
The affidavit in the Los Angeles seizure warrant discussed a series of cryptocurrency investment scams, one of which targeted a professional woman who was contacted on LinkedIn by a man who used the name “Fei Kuang.” After learning that the victim already had a small cryptocurrency account, “Fei Kuang” offered to help the victim, eventually convincing her to invest more money and to move her funds to another, presumably fraudulent, trading exchange. When she tried to withdraw her funds, she was told she had to pay a 20% in “taxes.” When the trading platform continued to demand more money, the woman realized she was the victim of a scam which cost her approximately $2.5 million.
“Transnational criminal organizations are combining confidence scams with technological savvy to swindle Americans out of their hard-earned funds,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “These particularly vicious frauds – where scammers carefully cultivate relationships with their victims over time – have devastated families and cost individuals their life savings. Now that we have seized this virtual currency, we will seek to swiftly return it to victims. In addition to our tireless efforts to disrupt these schemes, we must also work to raise public awareness and help inform potential victims: be wary of people you meet online; seriously question investment advice, especially about cryptocurrency, from people you have not met in person; and remember, investments that seem too good to be true, usually are.”
In 2022, investment fraud caused the highest losses of any scam reported by the public to the FBI’s Internet Crimes Complaint Center (IC3), totaling $3.31 billion. Frauds involving cryptocurrency, including pig butchering, represented most of these scams, increasing 183% from 2021 to $2.57 billion in reported losses last year.
According to the FBI, the highest number of reports came from victims between the ages of 30 and 49. In these schemes, often called “Sha Zhu Pan,” a Chinese phrase that loosely translates to “pig butchering,” scammers often target their victims through social networking and online communications platforms, dating websites, and phone calls and text messages that are meant to appear to have been misdialed. After gaining the trust of their victims – sometimes over a period of months – scammers eventually introduce the idea of trading in cryptocurrency. They then direct victims to cryptocurrency investment platforms or to co-conspirators posing as investment advisors or customer service representatives. Scammers control websites that are built to look like legitimate trading platforms, applications that victims download onto their phones, or malicious smart contracts accessed through cryptocurrency wallet software.
Once victims make an initial “investment,” the platforms purport to show substantial gains. Sometimes, victims are even allowed to withdraw some of these initial gains to further engender trust in the scheme. It is not until a large investment is made that victims find that they are unable to withdraw their funds.
Even when a victim is denied access to their funds, the fraud is often not yet over. Scammers request additional investments, taxes or fees, promising that these payments will allow victims access to their accounts. These scam operations often continue to steal from their victims and do not stop until they have deprived victims of any remaining savings.
“Depriving scam organizations of their ill-gotten gains is an important part of our strategy to combat these ruthless schemes,” said Director Eun Young Choi of the Criminal Division’s National Cryptocurrency Enforcement Team (NCET). “We will continue to use all tools at our disposal to disrupt and deter cryptocurrency confidence schemes, including by following the money on the blockchain and seizing cryptocurrency to return funds to victims, and by targeting and taking down online infrastructure used by the scammers. Today’s announcements also demonstrate the value of early notification by victims to law enforcement; we thank those victims who came forward to notify the FBI when they were targeted by this scheme.”
The FBI Phoenix Division is investigating the matter that resulted in seizures announced today.
Assistant United States Attorney Daniel Boyle of the Asset Forfeiture and Recovery Section is handling the Los Angeles case. The other cases are being handled by the District of Arizona and the District of Idaho. The NCET and the Criminal Division’s Fraud Section provided substantial assistance and coordination.
If you or someone you know is a victim, visit www.fbi.gov/cryptoguard, contact your local FBI field office (the Los Angeles Field Office can be reached at 310-477-6565), call 1-800-CALL-FBI, or report it to IC3.gov. In your complaint, please reference, “Pig Butchering PSA.” Include as much information as possible in your complaint including names of investment platforms, cryptocurrency addresses and transaction hashes, bank account information, and names and contact information of suspected scammers. Maintain copies of all communications with scammers and records of financial transactions.
Justice Department Seizes over $112M in Funds Linked to Cryptocurrency Investment SchemesRead the Press Release
The Department of Justice announced today that it has seized virtual currency worth an estimated $112 million linked to cryptocurrency investment scams.
Seizure warrants for six virtual currency accounts were authorized by judges in the District of Arizona, the Central District of California, and the District of Idaho.
According to court documents, the virtual currency accounts were allegedly used to launder proceeds of various cryptocurrency confidence scams. In these schemes, fraudsters cultivate long-term relationships with victims met online, eventually enticing them to make investments in fraudulent cryptocurrency trading platforms. In reality, however, the funds sent by victims for these purported investments were instead funneled to cryptocurrency addresses and accounts controlled by scammers and their co-conspirators.
“Transnational criminal organizations are combining confidence scams with technological savvy to swindle Americans out of their hard-earned funds,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “These particularly vicious frauds – where scammers carefully cultivate relationships with their victims over time – have devastated families and cost individuals their life savings. Now that we have seized this virtual currency, we will seek to swiftly return it to victims. In addition to our tireless efforts to disrupt these schemes, we must also work to raise public awareness and help inform potential victims: be wary of people you meet online; seriously question investment advice, especially about cryptocurrency, from people you have not met in person; and remember, investments that seem too good to be true, usually are.”
In 2022, investment fraud caused the highest losses of any scam reported by the public to the FBI’s Internet Crimes Complaint Center (IC3), totaling $3.31 billion. Frauds involving cryptocurrency, including pig butchering, represented the majority of these scams, increasing a staggering 183% from 2021 to $2.57 billion in reported losses last year.
According to the FBI, the highest number of reports came from victims between the ages of 30 and 49. In these schemes, often called “Sha Zhu Pan,” a Chinese phrase that loosely translates to “pig butchering,” scammers often target their victims through social networking and online communications platforms, dating websites, and phone calls and text messages that are meant to appear to have been misdialed. After gaining the trust of their victims – sometimes over a period of months – scammers eventually introduce the idea of trading in cryptocurrency. They then direct victims to cryptocurrency investment platforms or to co-conspirators posing as investment advisors or customer service representatives. Scammers control websites that are built to look similar to legitimate trading platforms, applications that victims download onto their phones, or malicious smart contracts accessed through cryptocurrency wallet software. Once victims make an initial “investment,” the platforms purport to show substantial gains. Sometimes, victims are even allowed to withdraw some of these initial gains to further engender trust in the scheme. It is not until a large investment is made that victims find that they are unable to withdraw their funds. Even when a victim is denied access to their funds, the fraud is often not yet over. Scammers request additional investments, taxes, or fees, promising that these payments will allow victims access to their accounts. These scam operations often continue to steal from their victims and do not stop until they have deprived victims of any remaining savings.
“Depriving scam organizations of their ill-gotten gains is an important part of our strategy to combat these ruthless schemes,” said Director Eun Young Choi of the Criminal Division’s National Cryptocurrency Enforcement Team (NCET). “We will continue to use all tools at our disposal to disrupt and deter cryptocurrency confidence schemes, including by following the money on the blockchain and seizing cryptocurrency to return funds to victims, and by targeting and taking down online infrastructure used by the scammers. Today’s announcements also demonstrate the value of early notification by victims to law enforcement; we thank those victims who came forward to notify the FBI when they were targeted by this scheme.”
“Financial fraud schemes like these demonstrate the great lengths criminals will take to swindle innocent victims out of their money,” said Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division. “We continue to see these schemes evolve and provide new avenues for criminals to exploit. Today's announcement should serve as reminder of the FBI's unwavering commitment, alongside our federal and international law enforcement partners, to investigating and pursuing criminal actors who seek to defraud the American public. There is no place beyond the reach of the FBI.”
The FBI Phoenix Division is investigating this case.
Assistant U.S. Attorneys Seth Goertz and Ryan Ellersick for the District of Arizona, Daniel Boyle for the Central District of California, and Bill Humphries for the District of Idaho are in charge of the seizures announced today, with significant assistance and coordination by Georgiana MacDonald of the NCET and Tian Huang and Brandon Burkart of the Criminal Division’s Fraud Section.
If you or someone you know is a victim, visit www.fbi.gov/cryptoguard , contact your local FBI field office, call 1-800-CALL-FBI, or report it to the IC3.gov. In your complaint, please reference, “Pig Butchering PSA.” Include as much information as possible in your complaint including names of investment platforms, cryptocurrency addresses and transaction hashes, bank account information, and names and contact information of suspected scammers. Maintain copies of all communications with scammers and records of financial transactions.
Justice Department Files Lawsuit and Proposed Consent Decree to Prohibit Activision Blizzard from Suppressing Esports Player CompensationRead the Press Release
The Justice Department filed a civil antitrust lawsuit today against Activision Blizzard, Inc. (Activision), one of the world’s largest video game developers and publishers, for imposing rules that limited competition for players in Activision’s Overwatch and Call of Duty professional esports leagues and suppressed the wages of esports players in these leagues in violation of the Sherman Act.
“Video games and esports are among the most popular and fastest growing forms of entertainment in the world today, and professional esports players—like all workers—deserve the benefits of competition for their services. Activision’s conduct prevented that from happening,” said Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division. “Today’s lawsuit makes clear that the Antitrust Division remains committed to protecting workers across all types of industries from anticompetitive conduct.”
The complaint, filed today in the U.S. District Court for the District of Columbia, alleges that in two esports leagues owned by Activision, Activision and the independently-owned teams in each league implemented a so-called Competitive Balance Tax. As alleged in the complaint, the Tax was structured to penalize teams in the Overwatch and Call of Duty Leagues, respectively, if a team’s player compensation exceeded a threshold set by Activision.
At the same time, the Antitrust Division filed a proposed consent decree to address its competition concerns. If approved by the Court, the proposed consent decree would prohibit Activision from imposing any rule that would, directly or indirectly, limit player compensation in any of Activision’s professional esports leagues, or that would tax, fine, or otherwise penalize any team for exceeding a certain amount of compensation for its players.
The proposed consent decree with Activision would also require Activision to certify that it has ended all Competitive Balance Taxes in its professional esports leagues, to implement revised antitrust compliance and whistleblower protection policies, and to provide notice and an explanation of the final judgment to teams and players in its professional esports leagues.
As required by the Tunney Act, the proposed consent decree, along with the competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed consent decree during a 60-day comment period to Chief, Civil Conduct Task Force, Antitrust Division, Department of Justice, 450 Fifth Street NW, Suite 8600, Washington, D.C. 20530. At the conclusion of the 60-day comment period, the U.S. District Court for the District of Columbia may enter the final judgment upon finding it is in the public interest.
Today’s lawsuit is part of a broader focus of the Antitrust Division on anticompetitive labor market abuses. Anyone with information about anticompetitive conduct against workers, or any other violations of the antitrust laws, is encouraged to contact the Antitrust Division’s Citizen Complaint Center at 1-888-647-3258 or [email protected].
Jacksonville Convicted Felon Sentenced to More Than Five Years in Federal Prison for Firearm PossessionRead the Press Release
Jacksonville, Florida – U.S. District Judge Brian J. Davis has sentenced Terry Lenard Shipman (48, Jacksonville) to five years and five months in federal prison for possessing a firearm as a convicted felon. Shipman had pleaded guilty in December 2022.
According to court documents, on February 5, 2022, an officer from the Jacksonville Sheriff’s Office observed Shipman steal two alcoholic beverages from a RaceTrac gas station in Jacksonville. Shipman hid the beverages in his coat pocket and was confronted by the officer as he exited the store. Once detained, the officer retrieved the stolen merchandise from Shipman’s pocket, along with a Smith and Wesson .38 caliber revolver. At the time, Shipman had multiple prior felony convictions and had recently been released from prison for selling narcotics. As a previously convicted felon, he is prohibited from possessing a firearm or ammunition under federal law.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Jacksonville Sherriff’s Office. It was prosecuted by Assistant United States Attorney John Cannizzaro. The forfeiture will be handled by Assistant United States Attorney Mai Tran.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
Indian Citizen Indicted for Multiple Counts of Alien Smuggling and ConspiracyRead the Press Release
PLATTSBURGH, NEW YORK – Simranjit Singh, a/ka/ “Shally” Singh, age 40, a citizen of India residing in Canada, was extradited to the United States last week on an indictment charging him with alien smuggling and conspiracy to commit alien smuggling. At the request of the United States, Singh was taken into custody on June 28, 2022, in Ontario, Canada. Singh was extradited from Canada to the United States on March 30, 2023.
United States Attorney Carla B. Freedman; Chief Patrol Agent Robert N. Garcia, United States Border Patrol, Swanton Sector; and Matthew Scarpino, Special Agent in Charge of the Buffalo Field Office of Homeland Security Investigations (HSI), made the announcement.
A June 2022 indictment charges Singh with three counts of conspiracy to commit alien smuggling for profit and six additional counts of alien smuggling for profit, all of which allege his involvement and facilitation of the smuggling of Indian nationals from Canada into the United States, via Cornwall Island and the Akwesasne Mohawk Indian Reservation in the St. Lawrence River region, from at least March 2020 through March 2021. The charges in the indictment are merely accusations. The defendant is presumed innocent unless and until proven guilty.
Singh was arraigned on March 31, in Albany, before United States Magistrate Judge Daniel J. Stewart; he is detained pending a detention hearing scheduled for April 7.
If convicted on all charges, Singh faces at least 5 years and up to 15 years in prison, as well as at least 3 years of post-imprisonment supervised release. 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.
This case is being investigated by United States Border Patrol, Homeland Security Investigations, the Ontario Provincial Police, the Canadian Border Services Agency, and the Royal Canadian Mounted Police. Assistant U.S. Attorney Jeffrey Stitt is prosecuting this case. The Justice Department’s Office of International Affairs provided substantial assistance in securing the arrest and extradition of Singh.
Huntington Man Sentenced to Prison for Federal Gun CrimeRead the Press Release
HUNTINGTON, W.Va. – David Frazier, also known as “Dae Dae,” 43, of Huntington, was sentenced today to two years in prison, to be followed by three years of supervised release, for being a felon in possession of a firearm.
According to court documents and statements made in court, on June 9, 2022, law enforcement officers conducted a traffic stop of a vehicle in which Frazier was a passenger on the 100 block of Cedar Street in Huntington. Officers searched the vehicle and found a Taurus, model G2C, 9mm pistol. Frazier admitted to possessing the firearm.
Federal law prohibits a person with a prior felony conviction from possessing a firearm or ammunition. Frazier knew he was prohibited from possessing a firearm because of his prior felony convictions for aggravated robbery in Wayne County Circuit Court on April 14, 2000, and for being a felon in possession of a firearm in Cabell County Circuit Court on March 2, 2018.
United States Attorney Will Thompson made the announcement and commended the investigative work of the Huntington Police Department.
United States District Judge Robert C. Chambers imposed the sentence. Assistant United States Attorney Stephanie Taylor prosecuted the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 3:22-cr-222.
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Greenville Man Sentenced to Prison for Gun and Drug CrimesRead the Press Release
Oxford, MS – A Greenville man was sentenced today to more than 5 years in prison for drug trafficking and illegal firearm possession.
According to court documents, Bobby Buchanan, 44, previously pled guilty to one count of distribution of narcotics and one count of possession of a firearm by a convicted felon. The narcotics charge arose out of Buchanan’s sale of 100 ecstasy pills to a confidential informant. Buchanan, who is a prior convicted felon, was found in possession of a handgun when he was arrested on drug charges. Buchanan was subsequently charged with possession of a firearm by a prohibited person.
Buchanan was sentenced today by United States District Judge Glen Davidson to 67 months in prison. Buchanan will serve a three-year term of supervision upon his release from prison. Following sentencing, Buchanan was remanded to the custody of the U.S. Marshals.
“Today’s sentence is another step towards making our neighborhoods and communities safer for all,” stated U.S. Attorney Clay Joyner. “We will continue to work with the Greenville Police Department and our law enforcement partners to make sure that individuals who choose to commit gun crimes or distribute illicit drugs are held accountable for their criminal acts and the damage they do to their community.”
Commenting on the sentence, Greenville Police Chief Marcus Turner remarked, “We would first like to thank the Special Operations Division, officers of the Greenville Police Department, and the U. S. Attorney’s Office for a job well done. This conviction is only a small portion of the body of work that we have ahead of us in fighting drug and gun violence in our community. As we move forward, we will continue to diligently work together to ensure the safety of all citizens.”
This case was investigated by the Greenville Police Department. AUSA Robert Mims 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.
Four Miami Residents Indicted for their Alleged Role in a Wire Fraud Scheme to Defraud the Federal GovernmentRead the Press Release
MIAMI – A federal grand jury has indicted, Maylin Salado Garcia, “Salado Garcia,” 34, Niubis Garcia, “Niubis Garcia,” 52, Oscar Enrique Pujadas, “Pujadas,” 32, and Sirce Rodriguez Rosales, “Rosales,” 38, residents of Miami, Fla., for their alleged participation in a wire fraud scheme to defraud the federal government out of more than $250,000 of funds intended for workforce development programs. The charges include conspiracy to commit wire fraud, wire fraud, conspiracy to commit theft of government funds, theft of government funds, theft concerning programs receiving federal funds, and aggravated identity theft.
According to the indictment, the defendants and their co-conspirators allegedly executed a scheme to enrich themselves by obtaining reimbursement of monies from federally funded programs and depositing the reimbursed federal funds into personal and corporate bank accounts they controlled for their own personal use. In furtherance of the scheme, the defendants and their co-conspirators used stolen personal identifying information (PII) to create false and fraudulent employee files (“participant files”) and wage records. These fake participant files and wage records were used as proof of employment showing that individuals were employed at companies the defendants and their co-conspirators owned and controlled, as well as other companies.
According to court documents, Salado Garcia worked at Transition, Inc., a not-for-profit corporation located in Miami-Dade County; first as a program supervisor, and then as executive director. Transition received federal grants of money through the state of Florida, which were used to provide job training and placement services in the community. Transition worked with, for example, the Miami-Dade County Corrections and Rehabilitation Department’s (MDCR) Boot Camp Reentry Program, a federally funded program designed to provide education and training to inmates transitioning out of prison. From around April 2017 and February 2019, while employed at Transition, Salado Garcia allegedly created participant files and wage records using stolen PII to obtain federal funds for work that was never performed and, in some cases, to employees who were not employed at listed companies, and the few that did, received lower hourly wages than what Salado Garcia recorded in the participant files.
It is also alleged that Salado Garcia represented in the participant files that the employees purportedly worked at companies owned by her co-conspirators; her mother, Niubis Garcia, and her significant other, Pujadas. Additionally, Salado Garcia entered false payroll information into the Transition’s web-based payroll processor, including bank accounts owned by her and her co-conspirator, Rosales, to receive direct deposit payments from the federally funded programs which were intended for the purported employees. In addition, Rosales provided Salado Garcia with stolen PII to create the fraudulent participant files, while Pujadas also cashed the fraudulently obtained reimbursement checks at a check cashing store.
Salado Garcia, Niubis Garcia, and Rosales made their initial appearances last week before U.S. Magistrate Judge Otazo-Reyes. If convicted, Salado Garcia faces a maximum sentence of up to 87 months in addition to 24 months consecutively in prison, Niubis Garcia faces a maximum sentence of up to 51 months in prison, and
Rosales faces a maximum sentence of up to 57 months in prison.
U.S. Attorney Markenzy Lapointe for the Southern District of Florida and Special Agent in Charge Mathew Broadhurst of the U.S. Department of Labor Office of Inspector General (DOL-OIG), Southeast Region, announced the charges.
DOL-OIG investigated the case, with assistance from Miami-Dade County Office of the Inspector General. Assistant U.S. Attorney Yisel Valdes is prosecuting the case. Assistant U.S. Attorney Annika Miranda 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-20116.
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Former St. Louis Police Employee Admits Injuring Jail InmateRead the Press Release
ST. LOUIS – A former police department employee in St. Louis, Missouri on Monday admitted injuring a handcuffed jail inmate.
Edward Lamar Barber, 42, was a prisoner processing clerk at St. Louis’ City Justice Center at the time. On July 11, 2019, after an inmate, “M.J.,” struck another clerk, a corrections officer used pepper spray and placed M.J. on the floor, Barber’s plea agreement says.
M.J. became compliant, was handcuffed and then Barber and the corrections officer took M.J. to a cell. M.J. did not have any injury to his face when he went into the cell, Barber admitted in his plea. While in the cell, Barber “put his hands on M.J. and forced him to the ground. As a result, M.J. suffered fractures to his nose and orbital wall,” the plea agreement says.
Barber pleaded guilty Monday in front of U.S. District Judge Sarah E. Pitlyk to one felony count of deprivation of rights under color of law, a civil rights charge. Barber admitted willfully violating M.J.’s right to be free from unreasonable force.
Barber is scheduled to be sentenced July 6. The crime carries a maximum penalty of 10 years in prison, a $250,000 fine, or both.
The case was investigated by the St. Louis Metropolitan Police Department and the FBI. Assistant U.S. Attorney Christine Krug is prosecuting the case.
Former Oregon Securities Broker Sentenced to Federal PrisonRead the Press Release
PORTLAND, Ore.—A former Oregon securities broker was sentenced to federal prison today for willfully evading payment of more than $2.5 million in personal income taxes and using the excess cash to fund a lavish lifestyle.
James W. Millegan, aka JW Millegan, 65, of McMinnville, Oregon, was sentenced to 51 months in federal prison and three years’ supervised release. Millegan was also ordered to pay more than $2.5 million in restitution to the IRS and more than $1.4 million to 12 former clients.
“Tax evasion is a crime of greed that trivializes the duty all Americans share to pay their taxes. We take these crimes seriously and will continue working with our partners at the IRS to hold criminal tax evaders accountable,” said Ethan Knight, Chief of the Economic Crimes Unit for the U.S. Attorney’s Office.
“It’s been said that the difference between tax avoidance and tax evasion…is the thickness of a prison wall. Mr. Millegan is learning that firsthand today,” said Bret Kressin, Special Agent in Charge of the IRS Criminal Investigation (IRS:CI) Seattle Field Office. “While everyone is entitled to use legal means to reduce their tax liabilities, Mr. Millegan actively attempted to evade his taxes for many years. Instead of paying his fair share, Mr. Millegan lived lavishly at the expense of honest taxpayers. Today, he is answering for those crimes.”
According to court documents, Millegan owned and operated J.W. Millegan, Inc. (JWMI), a small, commission-based securities broker-dealer business that served clients in the Portland and Salem, Oregon metropolitan areas. From 1996 to 2016, the firm was Millegan’s only significant source of income. Millegan closed JWMI at the end of 2016, in part because a Financial Industry Regulatory Authority (FINRA) arbitration panel determined he had churned the investment accounts of several clients and fined him $450,000. Millegan filed for Chapter 13 bankruptcy almost immediately.
Over a seven-year period from July 2009 through September 2016 while operating JWMI, Millegan evaded payment of $2.5 million in income taxes due from 2006 through 2015. Millegan filed tax returns each year reflecting his true income, which sometimes exceeded $1 million, and the taxes he owed on that income, which typically ranged from $125,000 to $350,000. Despite these returns, Millegan usually paid almost no taxes when due.
Millegan was described as a prolific spender by personal assistants hired to pay his bills. He used the proceeds of his tax evasion to fund an extravagant lifestyle that included a $4.5 million home in Portland’s Dunthorpe neighborhood, a $1.3 million beach house in Gleneden Beach, Oregon, Rolls Royce and Bentley automobiles for everyday use, equestrian expenses like stabling and lessons, and an attempt to establish Wallace Bridge, a world-class equestrian competition center and resort near Sheridan, Oregon.
In 2003, Millegan bought a classic 1938 Rolls Royce Phantom III touring car at a classic car auction. From 2004 to 2006, while owing hundreds of thousands of dollars in past due taxes, Millegan spent $800,000 restoring his Phantom III, including shipping it to a restoration specialist in the United Kingdom, so that he could show it at classic car shows. In 2006 and 2007, Millegan paid to show his Phantom III at multiple premier car shows in the United States, United Kingdom, and Europe.
To evade the payment of his taxes, Millegan concealed his income from the IRS by transferring it to six bank accounts he controlled, including transferring $1.4 million to the bank account of his deceased mother’s trust, which he used to pay his personal expenses. From July 2009 through September 2016, Millegan transferred $3.7 million to these accounts. To further conceal his income, Millegan submitted false financial statements to the IRS.
On November 21, 2019, a federal grand jury in Portland returned a 13-count indictment charging Millegan with tax evasion and investment churning. Later, on February 17, 2022, he was charged by superseding indictment with wire fraud and tax evasion.
On November 14, 2022, Millegan was convicted at trial on one count of tax evasion. Millegan’s wire fraud charges were dismissed at sentencing.
This case was investigated by IRS:CI. It was prosecuted by Seth D. Uram and Meredith D.M. Bateman, Assistant U.S. Attorneys for the District of Oregon. Assistant U.S. Attorney Hannah Horsley assisted the trial team.
The referenced media source is missing and needs to be re-embedded.Former Middle School Teacher Sentenced to 10 Years in Prison for Distributing on Social Media Sexually Explicit Material of ChildRead the Press Release
RIVERSIDE, California – A former middle school mathematics teacher in San Bernardino was sentenced today to 120 months in federal prison for distributing an image of a child engaging in sexually explicit conduct.
Josue Gamaliel Vidal Quintanilla, 31, of Fontana, was sentenced by United States District Judge Jesus G. Bernal, who also ordered Vidal to pay $9,000 in restitution.
Vidal, who formerly taught mathematics at Shandin Hills Middle School in San Bernardino, pleaded guilty in October 2021 to one count of distribution of child pornography.
Vidal has been in federal custody since his arrest in this case in September 2020. He will be placed on supervised release for 20 years upon his release from prison.
In September 2019 and January 2020, law enforcement received information from the Kik and Snapchat internet messaging applications that one of their users had uploaded material that was suspected to show sexually explicit material involving children. The Internet Protocol (IP) address for the Kik and Snapchat accounts was assigned to Vidal’s residence in Fontana.
Law enforcement executed a search warrant at Vidal’s home in September 2020. Vidal agreed to speak with law enforcement and admitted to viewing child pornography since early 2019. He also admitted to sending people internet links to sexually explicit material involving children as young as infants.
In total, law enforcement recovered approximately 1,500 images and 724 videos of child pornography from Vidal’s Kik and Snapchat accounts and digital devices.
Vidal pleaded guilty to distributing to another Snapchat user in August 2020 a visual depiction of a minor engaged in sexually explicit conduct. Vidal was employed as a middle school teacher during this time, but his employment later was terminated.
“This conduct is abhorrent in and of itself, but it is especially disturbing and unacceptable considering defendant’s role in the community as a teacher,” prosecutors argued in a sentencing memorandum.
Homeland Security Investigations and the Fontana Police Department investigated this matter. The San Bernardino County Sheriff's Department provided assistance with this investigation.
Assistant United States Attorney Sonah Lee of the Riverside Branch Office prosecuted this case.
Former Idaho Transportation Department Skills Tester Pleads Guilty to Receiving Bribes in Exchange for Passing Scores on Commercial Driver’s License Skills TestsRead the Press Release
BOISE – Kelly Nathaniel Goodman, 71, of Gooding, Idaho, pleaded guilty to honest services wire fraud, U.S. Attorney Josh Hurwit announced today.
According to court records, to obtain a commercial driver’s license (CDL) in Idaho, an applicant must, among other requirements, receive a passing score from a CDL skills test examiner. The Idaho Transportation Department (ITD) contracts with third-party CDL skills test examiners to administer CDL skills tests in Idaho. Since the 1990s until late 2021, Goodman was an Idaho CDL skills test examiner.
Goodman, however, engaged in a scheme and artifice to defraud ITD’s right to honest services while serving as an Idaho CDL skills tester. Without the knowledge or permission of ITD, Goodman accepted bribes in return for providing passing scores on Idaho CDL skills tests. Goodman specifically pleaded guilty to receiving a bribe on August 31, 2021, in return for giving an individual a passing score on an Idaho CDL skills test.
Between December 2017 and May 2020, Goodman accepted numerous bribes in exchange for giving passing scores on Idaho CDL skills tests. During that time, Goodman received at least $38,000 in bribes in exchange for giving passing scores on Idaho CDL skills tests.
Goodman is scheduled to be sentenced on June 22, 2023, and faces a maximum penalty of 20 years in federal prison and a $250,000 fine. As part of a plea agreement, Goodman agreed to pay restitution to the Idaho Transportation Department and U.S. Department of Transportation, and to pay a forfeiture money judgment of at least $38,000. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
U.S. Attorney Hurwit credited the cooperative efforts of the Federal Bureau of Investigation and U.S. Department of Transportation—Office of Inspector General, which led to the charges.
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Former Fresno Bank Employee Pleads Guilty to Stealing More Than $70,000 from Customers’ AccountsRead the Press Release
FRESNO, Calif. — Lladira Hernandez, 23, of Fresno, pleaded guilty today to stealing more than $70,000 from multiple customers’ accounts at a Fresno-based bank where she was previously employed, U.S. Attorney Phillip A. Talbert announced.
According to court documents, in April 2022, Hernandez was hired by the bank as a customer service representative. She began stealing the bank account information for customers she helped over the phone and used it to pay bills for herself and her associates. This included mortgage payments, car payments, and phone bills. In August 2022, Hernandez transferred more than $45,000 from two customers’ accounts into her own account and abruptly quit her job at the bank. She proceeded to withdraw that money from her account and was captured doing so on surveillance video.
This case is the product of an investigation by the Federal Bureau of Investigation. Assistant U.S. Attorney Joseph Barton is prosecuting the case.
Hernandez is scheduled to be sentenced by U.S. District Judge Ana de Alba on Sept. 5, 2023. Hernandez faces a maximum statutory penalty of 10 years in prison and a $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Former Clarksville School Nurse Sentenced to Federal Prison for Child Pornography CrimesRead the Press Release
NASHVILLE – Leon B. Hensley, 42, a former Clarksville, Tennessee, school nurse, was sentenced today in U.S. District Court to 293 months in federal prison on child pornography charges, announced U.S. Attorney Henry C. Leventis.
Hensley, a former nurse at Northeast High School (NEHS) in Clarksville, was charged and arrested in May 2021, following an investigation into allegations that he sent a digital image, via text message, of a nude adult female to a minor female in the Clarksville area. Hensley had been communicating with the minor female via text and asked her to help him with a photo shoot by posing for photos.
The subsequent investigation resulted in a superseding indictment being returned in June 2022 charging Hensley with 25 counts of attempting to produce child pornography and enticing or coercing a minor to engage in sexually explicit conduct for the purpose of producing child pornography. Hensley pleaded guilty to all charges in September 2022, prior to a trial which was scheduled to begin the same day.
The investigation, including a search of Hensley’s phone led to the discovery of nude images which were later identified as minor female students at NEHS. A search of Hensley’s house resulted in the seizure of numerous electronic devices, including a small covert video camera. The devices also contained image files depicting unidentified females in hospital rooms, airports, and tanning beds, plus video files that appeared to be upskirt videos of adult and minor females.
This case was investigated by Homeland Security Investigations; the U.S. Secret Service; the FBI; and the Clarksville Police Department. Assistant U.S. Attorney Monica Morrison prosecuted the case.
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Five Men Sentenced in Conspiracy to Distribute Child Sexual Abuse MaterialRead the Press Release
MIAMI – Anthony Wayne Santiago, 28, of Novi, Mich.; Jacob Dominic VanDyke, 25, of Muskegon, Mich.; Johnathan Scott Fleak, 32, of Pryor, Okla.; Aaron Ray Iuliano, 27, of Ravenna, Ohio; and Michael Paul Gianfrancesco, 39, of Livingston, Tenn., all have pled guilty and been sentenced to conspiracy to distribute child sexual abuse material and distribution of child sexual abuse material (CSAM) of children under the age of 13 years.
From September to October 2021, the five defendants entered and participated in a private chat room within a social networking application. Each had to distribute CSAM of children under the age of 13 to enter the chat room. These defendants all distributed and solicited CSAM and discussed the sexual abuse of children among more than 50 other individuals. The children in the images and videos were as young as 4 years old.
Today, Judge Donald M. Middlebrooks sentenced the last of three defendants charged in the conspiracy. Michael Paul Gianfrancesco, who had previously distributed CSAM through multiple other social networking accounts, was sentenced to 17.5 years in prison. Aaron Ray Iuliano was sentenced to 15 years in prison. Jacob Dominic Vandyke to 13.3 years in prison. Previously, Judge Middlebrooks sentenced Johnathan Scott Fleak, who distributed CSAM through another online message boards, to 15 years in prison. Anthony Wayne Santiago, a registered sex offender who was on a GPS monitor at the time of his arrest, had been sentenced to 30 years in prison.
U.S. Attorney Markenzy Lapointe for the Southern District of Florida, acting Special Agent in Charge Michael E. Buckley of Homeland Security Investigations (HSI), Miami, and Sheriff Ric Bradshaw of the Palm Beach County Sheriff’s Office made the announcement.
HSI West Palm Beach Office and the Palm Beach County Sheriff’s Office investigated the case as part of a joint effort of the South Florida Internet Crimes Against Children Task Force. Assistant U.S. Attorneys Gregory Schiller and Brian Ralston prosecuted it.
This case was brought as part of Project Safe Childhood (PSC), 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 United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend and prosecute individuals, who sexually exploit children, and to identify and rescue victims. For more information about the Project Safe Childhood initiative and for information regarding Internet safety, please visit www.justice.gov/psc.
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 22-cr-80127.
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Federal Grand Jury Indicts Former Louisville Man for Possessing and Trafficking Machine GunsRead the Press Release
Louisville, KY – A federal grand jury in Louisville returned a two-count indictment on March 22, 2023, charging a Louisville man with possession of and trafficking in machine guns.
U.S. Attorney Michael A. Bennett of the Western District of Kentucky, Acting Special Agent in Charge Robert Maynard of the ATF Louisville Field Division, and Special Agent in Charge Rana Saoud of the Homeland Security Investigations Nashville made the announcement.
According to the indictment, Colin H. Billups, 20, of Louisville, Kentucky, was charged with one count of illegal possession of a machine gun, a Glock switch, and one count of trafficking in a firearm, a Glock switch. A Glock Switch device allows a semi-automatic handgun to function as an automatic and is defined as a machine gun under federal law.
The defendant made his initial court appearance on March 31, 2023, before a U. S. Magistrate Judge of the U. S. District Court for the Western District of Kentucky in Louisville. If convicted, Billups faces a maximum sentence of 25 years in prison. A federal district court judge will determine any sentence after considering the sentencing guidelines and other statutory factors. There is no parole in the federal system.
This case is being investigated by ATF and HSI with assistance from the Louisville Metro Police Department, the Shively Police Department, and the Kentucky State Police.
Assistant U.S. Attorney Frank Dahl is prosecuting the case.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
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Fayetteville Man Sentenced to More Than 8 Years in Prison for Firearm ChargeRead the Press Release
RALEIGH, N.C. – A Fayetteville man was sentenced today to 105 months imprisonment followed by 36 months of supervised release. Kevin Anthony Harmer, 32, of Fayetteville, North Carolina pled guilty on December 22, 2022, to Possession of a Stolen Firearm.
According to court documents and other information presented in court, on May 5, 2021, officers with the Fayetteville Police Department responded to a domestic violence call. Harmer was found near the residence with a loaded 9mm firearm in his waistband. While out on bond for that offense, Harmer was engaged in a verbal altercation with another man at a tobacco store in Fayetteville. During the altercation, Harmer shot the other man in the foot. That firearm was reported stolen by Harmer’s fiancé’s father.
Michael Easley, U.S. Attorney for the Eastern District of North Carolina made the announcement after the sentencing was concluded. U.S. District Judge James C. Dever III presided over the sentencing. The Bureau of Alcohol, Tobacco, Firearms and Explosions along with the Fayetteville Police Department investigated the case and Assistant U.S. Attorney Charity Wilson prosecuted the case.
Related court documents and information can be found on the website of the U.S. District Court for the Eastern District of North Carolina or on PACER by searching for Case No. 5:22-CR-00085-D.
False Statements During an Attempted Gun Purchase and History of Threatening Conduct Send Man to Federal Prison on Firearm ChargeRead the Press Release
A man that made false statements during an attempted purchase of a firearm was sentenced March 29, 2023, to more than 2 years in federal prison.
Dean Kohler, age 56, from Remsen, Iowa, received the prison term after an October 3, 2022, guilty plea to making false statements during the purchase of a firearm.
Evidence in the case showed Kohler knowingly made false statements and representations to a Federal Firearms Licensee in Sioux City, Iowa, in the attempted acquisition of a rifle. Kohler represented that, 1) he had never been adjudicated as a mental defective or committed to a mental institution when, in fact, he had been subject to two court orders adjudicating him as mental defective; and 2) that he was not subject to a court order restraining him from harassing, stalking, or threatening a child or an intimate partner or the child of such partner when, in fact, at the time of the attempted acquisition, he was then the subject of a protective order with an intimate partner. When the federal background check prevented the sale, Kohler found a private party willing to sell him a firearm.
Kohler’s criminal history includes Operating While Intoxicated, Carrying Weapons, Violation of Protective Order, Disorderly Conduct, Assault With a Dangerous Weapon – where he threatened people in a Walmart parking lot with a chainsaw, and Harassment – where Kohler told a person "…time was running out for [him] and [his] stupid mother” and Kohler repeatedly drove by the victims’ home honking his horn.
Kohler was sentenced in Sioux City by United States District Court Chief Judge Leonard T. Strand to 33 months’ imprisonment. He must also serve a 3-year term of supervised release after the prison term. There is no parole in the federal system.
Kohler is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was investigated by USDOJ-ATF and prosecuted by Assistant United States Attorney Forde Fairchild.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 22-4038.
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Estranged wife of former deputy constable heads to prison for cocaine conspiracyRead the Press Release
HOUSTON - A 46-year-old Huffman resident has been sent to prison for conspiracy to possess with intent to distribute more than five kilograms of cocaine, announced U.S. Attorney Alamdar S. Hamdani.
Priscella Yvette Cervantes is the estranged wife of a former Harris County Precinct 1 deputy constable. A federal jury convicted her Oct. 25, 2022, following a four day-trial and approximately two hours of deliberations.
Today, U.S. District Judge David Hittner sentenced her to a total of 121 months in federal prison to be immediately followed by five years of supervised release. At the hearing, the court heard additional argument about the sufficiency of the evidence that detailed the criminal investigation.
On or about Dec. 5, 2020, Cervantes escorted a tractor-trailer in a “ghost” police vehicle – which is a vehicle that has lights and sirens and a police decal. Her co-defendant and now estranged husband, Alexsandar S. Reyes, met her off Interstate 10 in his marked constable vehicle and then continued to escort the tractor trailer through the Houston area on I-10.
After the drug escort, Reyes received a total of $6000 in cash which Cervantes believed would be split with her.
At trial, the defense attempted to convince the jury that Cervantes did not know anything about the drug proceed monies or the cocaine. The jury did not believe those claims and found her guilty as charged.
Reyes, 49, also of Huffman, had previously pleaded guilty and is pending sentencing.
Cervantes has been in custody since the return of the verdicts where she will remain pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The FBI conducted the investigation with assistance of Harris County Precinct 1 Constable’s Office, Houston Police Department and Texas Department of Public Safety.
Assistant U.S. Attorneys Carolyn Ferko and Heather Winter prosecuted the case.
Essex County Postal Employee Admits Mail TheftRead the Press Release
NEWARK, N.J. – An Essex County man today admitted stealing credit cards and checks from the mail while employed as a U.S. Postal Service letter carrier, Attorney for the United States Vikas Khanna announced.
Parrish Brookins, 30, of East Orange, New Jersey, pleaded guilty before U.S. District Judge Claire C. Cecchi to an information charging him with one count of mail theft by a U.S. Postal Service officer or employee.
According to the documents filed in this case and statements made in court:
From January 2021 to September 2021, Brookins was employed as a U.S. Postal Service letter carrier with delivery routes in Montclair and Verona, New Jersey. Certain credit cards addressed to third-party victims and mailed to addresses in Verona and Montclair were stolen on numerous dates from routes worked by Brookins. These credit cards subsequently were activated and used to make and attempt to make fraudulent purchases in New Jersey and elsewhere. Numerous stimulus checks issued by the U.S. Department of Treasury also addressed to third-party victims and mailed to addresses in Verona covered by Brookins were also stolen along these same postal routes.
Brookins admitted in court that he had stolen numerous items of mail containing credit cards addressed to individuals living at residences on his postal delivery routes, activated some of these cards and attempted to make purchases with them. He admitted that he provided some of the stolen cards to other individuals in exchange for a fee. Brookins admitted stealing more than a dozen stimulus checks in March of 2021, which were being mailed to recipients along his postal delivery routes, and to providing these checks to other individuals for a fee, knowing that these checks would be fraudulently negotiated by others.
The mail theft charge is punishable by a maximum potential penalty of five years in prison and a maximum $250,000 fine. Sentencing is scheduled for Aug. 15, 2023.
Attorney for the United States Khanna credited special agents with the U.S. Postal Service – Office of Inspector General, under the direction of Special Agent in Charge Matthew Modafferi, Northeast Area Field Office, and postal inspectors of the U.S. Postal Inspection Service in Newark, under the direction of Inspector Christopher A. Nielsen, Philadelphia Division, with the investigation leading to today’s guilty plea. He also thanked IRS - Criminal Investigation, under the direction of Acting Special Agent in Charge Tammy L. Tomlins, for its assistance.
The government is represented by Assistant U.S. Attorney Mark J. McCarren of the Office’s Special Prosecutions Division in Newark.
brookins.information.pdfDistrict of Columbia Man Pleads Guilty to Bribing Correctional Officer to Smuggle Drugs into D.C. JailRead the Press Release
WASHINGTON –A District of Columbia man pleaded guilty today to bribing a public official to smuggle drugs into the D.C. jail. Andre Gregory, 31, pleaded guilty in United States District Court to one count of bribery. U.S. District Court Judge Dabney L. Friedrich scheduled a sentencing hearing for June 12, 2023. U.S. Attorney Matthew M. Graves for the District of Columbia and FBI Special Agent in Charge Wayne A. Jacobs of the Washington Field Office made the announcement.
According to court documents, in June of 2022, Gregory contacted Keywaune McLeod, 28, via jail telephone. Specifically, Gregory recruited McLeod to act as a conduit outside of D.C. jail to package narcotics and manage payments from the sale of those narcotics from inside the jail. As a part of this conspiracy, McLeod would package and provide drugs to a public official, Beverly Williams, 52, a Correctional Officer working at the jail, who would smuggle them into the facility by concealing them on her body. Once inside the D.C. Jail, Williams would transfer the drugs to Gregory who would then distribute the drugs for a profit. McLeod would accept and manage the proceeds from such distribution using CashApp and make bribe payments to the Williams for the drug smuggling.
Previously in September and October of 2022, Williams was charged as part of a three-co-defendant complaint, later followed by an indictment. Specifically, McLeod, Williams and Andre Gregory were charged with conspiracy, bribery and smuggling.
The bribery charge carries a statutory maximum sentence of 15 years in prison, as well as potential financial penalties. The federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
In announcing the sentence, U.S. Attorney Graves and Special Agent in Charge Jacobs commended the work of those who investigated the case from the FBI and the District of Columbia Department of Corrections Office of Investigative Services.
This case is being prosecuted by Assistant U.S. Attorneys Gauri Gopal and Ahmed Baset with assistance from Paralegal Specialist Lisa Abbe, of the U.S. Attorney’s Office for the District of Columbia’s Fraud, Public Corruption and Civil Rights Section.