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14 April 2023
Woodbridge Man Sentenced for Distributing Narcotics to 14-Year-OldRead the Press Release
ALEXANDRIA, Va. – A Woodbridge man was sentenced today to 52 months in prison for distributing a Schedule II controlled substance to a person under age twenty-one.
According to court documents, in April of 2022, Latae'veion Woods, 21, sold pills purporting to be Percocet to a 14-year-old, who died of a fentanyl overdose approximately five days after the distribution. Following the overdose death, officers found a clear plastic baggie containing four blue pills with markings consistent with 30 milligram Percocet pills in the juvenile’s pants. Analysis later showed that the pills actually contained fentanyl. Police also discovered text messages on the 14-year-old’s phone which revealed that Woods distributed pills to the juvenile on multiple occasions during March and April 2022. The messages further established that Woods instructed the juvenile how to redistribute the pills and directed him to resell the pills for a specific amount of money. No other messages were located on the juvenile’s phone to suggest he had any other source of supply for Percocet.
Messages also demonstrated that Woods offered to sell the juvenile a firearm, specifically, a Glock 19 or Glock 48 semiautomatic handgun. During a search warrant of Woods’ residence, law enforcement seized a Glock 48 handgun and a Glock-style semi-automatic “ghost” gun, both of which Woods admitted belonged to him.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia; Jarod Forget, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Division; and Peter Newsham, Chief of Prince William County Police, made the announcement after sentencing by Senior U.S. District Judge T. S. Ellis, III.
Special Assistant U.S. Attorney Lauren Hahn prosecuted the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:22-cr-226.
Washington man admits attempting to coerce minor for sexual activity in undercover investigationRead the Press Release
MISSOULA — A Washington man who was accused of traveling to Missoula expecting to meet a child for sex and was arrested in an undercover investigation admitted to a coercion crime today, U.S. Attorney Jesse Laslovich said.
Kenton Alan Shaull, 59, pleaded guilty to attempted coercion and enticement of a minor. Shaull faces a mandatory minimum of 10 years to life in prison, a $250,000 fine and not less than five years of supervised release.
U.S. District Judge Donald W. Molloy presided. The court will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. Sentencing was set for July 26. Shaull was detained pending further proceedings.
The government alleged in court documents and in statements in court that from January to May 2022, Shaull used his cellular phone to communicate on an internet-based social media service with a profile he believed belonged to a child, identified as “E,” who was under the age of 14. Shaull reaffirmed multiple times his belief that “E” was a child under the age of 14. Shaull also expressed his desire to engage in sexual activity with “E” and sent several sexually explicit videos of himself. Shaull further expressed his desire to meet “E” in person for sexual activity and traveled to Missoula on May 14, 2022 to meet with “E” at a pre-determined location, where law enforcement officers arrested him.
Assistant U.S. Attorney Brian C. Lowney is prosecuting the case. The FBI’s Child Exploitation and Human Trafficking Task Force and Missoula County Sheriff’s Office investigated the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
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USAO hosts training at Texas Medical Center on cyberintrusion safety measuresRead the Press Release
HOUSTON – Executives and leaders of the Texas Medical Center (TMC) have learned about the dangers of cyberattacks by malicious actors like China, Russia and transnational criminals and how to tackle those attacks, announced U.S. Attorney Alamdar S. Hamdani.
The U.S. Attorney’s Office (USAO) along with FBI, Homeland Security Investigations, Cybersecurity and Infrastructure Security Agency and the Food and Drug Administration provided the training which included essential tools and protocols for TMC attendees to follow if their facilities are subject to cyber intrusions.
Methodist Hospital hosted the training event with attendees from Memorial Herman Hospital, Texas Children’s Hospital, MD Anderson, Baylor College of Medicine and the University of Texas Health System.
Criminal organizations and nation state actors like China, Russia and Iran as well as other bad actors have become more sophisticated in their ability to launch cyber-attacks against critical infrastructure such as the health care facilities in the TMC.
“It is essential to national security and crucial to the safety of patients for federal law enforcement to work closely with the health care sector to develop resilient and adaptive defenses against malicious cyberspace activity and network intrusions,” said Hamdani. “The USAO will continue to seek opportunities to enhance collaboration with our law enforcement partners and the health care industry to prevent potential network intrusions and ensure greater unity of effort in response to cyber incidents.”
On a weekly basis, hundreds of cyberattacks occur on businesses all across the Southern District of Texas. There must be a quick response team in place to immediately address the intrusion in order to circumvent major damage and losses. The USAO routinely works with other prosecutors and law enforcement in the district to stay ahead of potential cyber threats.
As the global economy enters another year of Russia’s invasion of Ukraine, and China continues to seek to disrupt critical industries like the health care sector, the private industry must be reminded to be diligent about their networks and to know their response plans, have a paper copy available and review their cyber-related insurance policies.
The USAO has established contact lines for assistance 24 hours a day. If you have fallen victim to an intrusion, inadvertently diverted funds to an unknown third-party or suffered a ransomware attack, please email directly or call the hotline at 713-542-5213.
U.S. Attorney’s Office Reminds Healthcare Providers of ADA’s Effective Communication RequirementsRead the Press Release
ALEXANDRIA, Va. – The United States Attorney’s Office for the Eastern District of Virginia announced today that it has sent a Dear Colleagues Letter reminding healthcare providers of the effective communication requirements under the Americans with Disabilities Act (ADA). To strengthen awareness and understanding of these requirements, the U.S. Attorney’s Office is inviting the public, including personnel at healthcare providers, to an informational meeting that will be held on June 6, 2023, at 1 p.m.
When Congress passed the ADA, it recognized that discrimination against individuals with disabilities persists in critical areas, including health services, which often involve high stakes communication. Through the ADA, Congress established a national mandate for the elimination of discrimination against individuals with disabilities by providing strong and enforceable standards. In support of these goals, the ADA and its implementing regulations require covered entities, including healthcare providers, to furnish appropriate auxiliary aids and services to individuals with communication disabilities without imposing a surcharge on the individual, including qualified sign language interpreters, computer-aided transcription services, and effective methods of making visually delivered materials available to individuals who are blind or have low vision.
The ADA requirements apply to a variety of healthcare providers, including those operated by either private entities or state and local governments, such as hospitals, nursing facilities, urgent care providers, physicians, dentists, optometrists, durable medical equipment retailers, infirmaries located at institutions of higher learning and correctional facilities, and local mental health agencies. Further, the ADA applies to all services that covered entities provide, including in-person medical services, telehealth appointments, electronic kiosks, and websites.
The Dear Colleagues Letter explains that “[p]ursuant to the ADA, healthcare providers are required to ensure that communication with people with disabilities is as effective as communication with people without disabilities.” Further, “healthcare providers may not decline to provide treatment to an individual solely because they have a disability and may need auxiliary aids and services.” The Dear Colleagues Letter also includes links to numerous Department of Justice publications that provide a detailed discussion of the ADA’s effective communication requirements, including publications on ADA.gov: “ADA Requirements: Effective Communication,” “ADA Business BRIEF: Communicating with People Who Are Deaf or Hard of Hearing in Hospital Settings,” and “Guidance on Web Accessibility and the ADA.” In addition, the Dear Colleagues Letter provides links to settlement agreements that provide a roadmap to the steps that covered entities can take to comply with the ADA, including Settlement Agreements with Goochland Powhatan Community Services, Brookside Rehabilitation & Nursing Center, Spotsylvania Regional Medical Center, Rite Aid Corporation, and Lincare, Inc.
The Dear Colleagues Letter announces that at 1 p.m. on June 6, 2023, the U.S. Attorney’s Office will be holding a virtual meeting for the public, including personnel at healthcare providers, to share information on the steps providers can take to comply with the ADA’s effective communication requirements, and provide an opportunity for questions and collaboration. The registration link for the meeting is here.
“Ensuring that healthcare providers are complying with the ADA by being accessible to individuals with communication disabilities is a critical mission of this Office,” said U.S. Attorney Jessica D. Aber. “We look forward to meeting with personnel from healthcare providers so that we can discuss the ADA’s effective communication requirements in healthcare settings.”
The U.S. Attorney’s Office, through its Civil Rights Enforcement (CRE) Unit, and in partnership with the Justice Department’s Civil Rights Division, works to uphold the civil and constitutional rights of all Americans, particularly some of the most vulnerable members of our society. The Office vigorously enforces a variety of federal statutes that prohibit discrimination, including the ADA and the Civil Rights Act of 1964, Civil Rights of Institutionalized Persons Act, and Equal Educational Opportunities Act of 1974. The CRE Unit also enforces the Servicemembers Civil Relief Act and the Uniformed Services Employment and Reemployment Rights Act of 1994, which protect military members as they enter and return from active duty.
For more information on the ADA, visit https://www.ada.gov or call the Justice Department’s toll-free ADA information line at 800-514-0301 or 800-514-0383 (TDD).
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia.
U.S. Attorney Announces Charges Against Leadership of the Sinaloa Cartel and 25 Other Defendants in Massive Fentanyl Importation and Trafficking ConspiraciesRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, Merrick B. Garland, the Attorney General of the United States, Lisa O. Monaco, the Deputy Attorney General of the United States, and Anne Milgram, the Administrator of the U.S. Drug Enforcement Administration (“DEA”), announced today the unsealing of fentanyl trafficking, weapons, and money laundering charges contained in three Indictments charging 28 defendants, including 23 based in Mexico, four based in China, and one based in Guatemala.
Since at least in or about 2014, the Sinaloa Cartel has run a global fentanyl manufacturing and distribution operation, sending massive quantities of fentanyl — a drug that has killed unprecedented numbers of Americans — into the United States. Cartel leadership includes three sons of the Sinaloa Cartel’s former leader, Joaquín Archivaldo Guzmán Loera, a/k/a “El Chapo,” known as the “Chapitos”: IVAN ARCHIVALDO GUZMAN SALAZAR, JESUS ALFREDO GUZMAN SALAZAR, a/k/a “Alfredo,” and OVIDIO GUZMAN LOPEZ, a/k/a “Raton.” Together with their co-conspirators, the Chapitos allegedly controlled extensive, multi-faceted, and international operations covering the fentanyl trade, which was designed to pump staggering quantities of fentanyl into the United States — in IVAN ARCHIVALDO GUZMAN SALAZAR’s words, to flood the United States with fentanyl in order to supply “streets of junkies.” The Indictments returned today charge not only the Chapitos but also top lieutenants and leadership of the Sinaloa Cartel; alleged manufacturers and distributors of the Sinaloa Cartel’s fentanyl; the managers of the violent armed security apparatus that protects the Sinaloa Cartel’s drug trafficking operations; the sophisticated money launderers who repatriate the Sinaloa Cartel’s drug proceeds back to Mexico; and multiple chemical precursor suppliers in China that fuel the Sinaloa Cartel’s fentanyl distribution operation. Through these efforts, the Chapitos and the Sinaloa Cartel allegedly reaped hundreds of millions of dollars in profits by flooding the United States with fentanyl. Seven defendants are in custody pending extradition proceedings: OVIDIO GUZMAN LOPEZ was arrested in Mexico; CARLOS OMAR FELIEX GUTIERREZ and SILVANO FRANCISCO MARIANO, a/k/a “Rayo,” were arrested in Colombia; SERGIO DUARTE FRIAS, ANA GABRIELA RUBIO ZEA, and HUMBERTO BELTRAN CUEN, a/k/a “Don Chino,” were arrested in Guatemala; and ANASTACIO SOTO VEGA, a/k/a “Tachin,” was arrested in Greece. Additionally, JULIO MARIN GONZALEZ was previously arrested in the United States and will be arraigned before U.S. District Judge Katherine Polk Failla.
U.S. Attorney Damian Williams said: “For over a decade, the illicit fentanyl trade has created a plague of addiction, death, and misery for Americans and New Yorkers of all walks of life. As alleged, the sons of the infamous Sinaloa Cartel leader ‘El Chapo,’ Ivan Archivaldo Guzman Salazar, Jesus Alfredo Guzman Salazar, and Ovidio Guzman Lopez, commanded the Sinaloa Cartel’s fentanyl manufacturing and trafficking operation. Today’s charges target not only Sinaloa Cartel leadership but the Cartel’s entire fentanyl infrastructure, including the armed enforcers who use abhorrent violence to protect the Cartel, the lab operators who produce untold quantities of fentanyl, the drug traffickers who move their deadly fentanyl into and throughout the United States, the money launderers who funnel proceeds back to the Cartel, and the China-based chemical suppliers who service the Cartel. I commend the career prosecutors of the Southern District of New York and our partners at the Drug Enforcement Administration for their tireless efforts to disrupt the Sinaloa Cartel’s fentanyl trafficking at all levels. We hope that today’s charges are a major step toward accountability for those who have for so long pushed this poison into our communities.”
Attorney General Merrick B. Garland said: “Today, the Justice Department is announcing significant enforcement actions against the largest, most violent, and most prolific fentanyl trafficking operation in the world – run by the Sinaloa Cartel, and fueled by Chinese precursor chemical and pharmaceutical companies. Families and communities across our country are being devastated by the fentanyl epidemic. Today’s actions demonstrate the comprehensive approach the Justice Department is taking to disrupt fentanyl trafficking and save American lives.”
Deputy Attorney General Lisa O. Monaco said: “The fentanyl crisis in America – fueled in large part by the Sinaloa cartel – threatens our public health, our public safety, and our national security. Today’s indictments target every element of the Sinaloa Cartel's trafficking network and reflect the Justice Department's commitment to attacking every aspect of this threat: from the chemical companies in China that spawn fentanyl precursors, to the illicit labs that produce the poison, to the networks and money launderers and murderers that facilitate its distribution. Just as we have gone on offense against terrorists and cyber criminals around the globe, the Department is now waging a relentless campaign to disrupt the production and trafficking of fentanyl – before it can reach its victims.”
DEA Administrator Anne Milgram said: “Today’s indictments send a clear message to the Chapitos, the Sinaloa Cartel, and criminal drug networks around the world that the DEA will stop at nothing to protect the national security of the United States and the safety and health of the American people. The Chapitos pioneered the manufacture and trafficking of fentanyl – the deadliest drug threat our country has ever faced – flooded it into the United States for the past eight years and killed hundreds of thousands of Americans. Over the last year and a half, the DEA proactively infiltrated the Sinaloa Cartel and the Chapitos network, obtained unprecedented access to the organization’s highest levels, and followed them across the world. I am grateful to the men and women of the DEA for their exceptional work on this case, which is the beginning of our work as ‘One DEA’ to dismantle every part of the criminal cartels that are killing Americans at record rates.”
According to the allegations contained in the Indictments, other court filings, and statements made during court proceedings:[1]
The Sinaloa Cartel (the “Cartel”) is one of the most powerful drug cartels in Mexico and is largely responsible for the manufacturing and importing of fentanyl for distribution in the United States. Fentanyl is a dangerous synthetic opioid that is more than 50 times more potent than heroin. Fentanyl is now the leading cause of death for Americans ages 18 to 49, and it has fueled the opioid epidemic that has been ravaging families and communities across the United States for the past approximately eight years. Between 2019 and 2021, fatal overdoses increased by approximately 94%, with an estimated 196 Americans dying each day from fentanyl.
The Cartel is led, in part, by IVAN ARCHIVALDO GUZMAN SALAZAR, JESUS ALFREDO GUZMAN SALAZAR, and OVIDIO GUZMAN LOPEZ, who are sons of the Cartel’s notorious former leader, Joaquín Archivaldo Guzmán Loera, a/k/a “El Chapo,” and are known collectively as the “Chapitos.”
Since in or about 2014, the Chapitos’ alleged fentanyl trafficking operation for the Cartel has grown exponentially in volume, scale, and sophistication. Under the Chapitos’ leadership, the Cartel operates a vast fentanyl trafficking operation that integrates each step in the fentanyl trade, from manufacture to distribution. Members and affiliates of the Cartel purchase and import fentanyl precursor chemicals from China directly or through third countries, manufacture fentanyl in laboratories in the mountains of Sinaloa, move that fentanyl across the border into the United States, distribute that fentanyl through various networks operating across the United States, and launder the proceeds back to Mexico.
As a critical part of the fentanyl trafficking enterprise, the Cartel relies on and directs hundreds of violent, heavily armed soldiers (known as sicarios) to protect the Cartel’s fentanyl operations at every step and intimidate others who might attempt to cheat, interfere with, or compete against the Cartel through kidnapping, torture, and murder using machineguns and other weaponry. As alleged, the Chapitos’ sicarios operated under the direction of the Chapitos and OSCAR NOE MEDINA GONZALEZ, a/k/a “Panu,” NESTOR ISIDRO PEREZ SALAS, a/k/a “Nini,” and JORGE HUMBERTO FIGUEROA BENITEZ, a/k/a “27,” to kidnap, torture, and kill anyone who opposed the Chapitos.
To manufacture fentanyl, the Cartel uses precursor chemicals procured principally from China. As alleged, the Cartel relies on brokers such as ANA GABRIELA RUBIO ZEA, a/k/a “Gaby,” who procure fentanyl precursor chemicals for the Cartel through Chinese chemical companies and the owners and operators of the Chinese chemical companies, including KUN JIANG, YONGHAO WU, a/k/a “Tim,” YAQIN WU, a/k/a “Lily,” and HUATAO YAO, a/k/a “Yao.”
The Cartel also employs skilled chemists — or “cooks” — who have expertise in synthesizing fentanyl from the China-sourced precursor chemicals. In one day alone, a Cartel cook can manufacture over 100,000 pills using pill press machines. In some instances, Cartel traffickers under the Chapitos have tested the purity of their fentanyl by testing it on others. For example, in or about 2022, PEREZ SALAZ and FIGUEROA BENITEZ experimented on a woman by injecting her repeatedly with doses of fentanyl until she died.
Led by the Chapitos, the trafficking of finished fentanyl powder and pills is a main goal of the Cartel and one of its most lucrative endeavors. Most often, the Cartel’s fentanyl crosses into the United States at ports of entry, including concealed in secret compartments of cars, disguised among goods in tractor-trailers, hidden in luggage on planes, obscured through fake paperwork in shipping containers, or secreted on or in the bodies of drug mules.
Once the Cartel’s fentanyl is transported into the United States, Cartel traffickers maintain designated stash locations where the fentanyl is stored, and the Cartel’s U.S.-based distribution network then sells the fentanyl wholesale for retail distribution throughout the United States, including in New York City. In 2022, alone, the DEA seized over 57 million fentanyl-laced pills and over 13,000 pounds of fentanyl powder — the equivalent of approximately 410 million potentially deadly doses of fentanyl.
Finally, as alleged, the Cartel relies on increasingly sophisticated ways of laundering fentanyl proceeds from the United States back into Mexico to enrich the Chapitos. For example, over the course of approximately two years, a single Cartel trafficker in the United States assisted in the laundering of more than $24 million in narcotics proceeds belonging to OVIDIO GUZMAN LOPEZ by providing to Cartel money launderers in the United States approximately $15 million and by sending approximately $9 million in bulk cash to Mexico hidden in secret compartments in cars. Other alleged Cartel money launderers, including MARIO ALBERTO JIMENEZ CASTRO, a/k/a “Kastor,” and SERGIO DUARTE FRIAS, have used cryptocurrency wallets to launder hundreds of thousands of dollars in fentanyl proceeds for the Cartel.
* * *
A chart containing the charges and minimum and maximum penalties each defendant faces is attached. The statutory minimum and maximum penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants would be determined by a judge.
Mr. Williams praised the outstanding investigative work of the DEA’s Special Operations Division, Bilateral Investigations Unit; Atlanta Division Office; Aviation Division; Boston Division Office; Denver Division Office; Imperial County District Office; Indianapolis District Office; Los Angeles Division Office; Nashville District Office; Newark Division Office; New York Division Office; Omaha Division Office; Orlando District Office; Philadelphia Division Office; Phoenix Division Office; Riverside District Office; Salt Lake City District Office; San Diego Division Office; San Ysidro District Office; Madrid Country Office; Athens Country Office; Bogota Country Office; Canberra Country Office; Guatemala City Country Office; Vienna Country Office; and multiple DEA offices throughout Mexico, as well as the assistance of the Office of International Affairs of the Justice Department’s Criminal Division; the U.S. Department of the Treasury, Office of Foreign Assets Control; and the U.S. Department of State, Rewards for Justice Program.
This case is being handled by the Office’s National Security and International Narcotics Unit. Assistant U.S. Attorneys Kyle A. Wirshba, Nicholas S. Bradley, Sarah L. Kushner, David J. Robles, and Alexander Li are in charge of the prosecution.
The charges in the Indictments are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
United States v. Ovidio Guzman Lopez, 23 Cr. 42
Defendant
Age
Charges
Minimum and Maximum Penalties
OVIDIO GUZMAN LOPEZ, a/k/a “Raton”
33
Continuing criminal enterprise; fentanyl importation conspiracy; fentanyl distribution conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices; conspiracy to commit money laundering
Mandatory life in prison
United States v. Ivan Archivaldo Guzman Salazar, et al., 23 Cr. 180
Defendant
Age
Charges
Minimum and Maximum Penalties
IVAN ARCHIVALDO GUZMAN SALAZAR
39
Continuing criminal enterprise; fentanyl importation conspiracy; fentanyl distribution conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices; conspiracy to commit money laundering
Mandatory life in prison
JESUS ALFREDO GUZMAN SALAZAR, a/k/a “Alfredo”
36
Continuing criminal enterprise; fentanyl importation conspiracy; fentanyl distribution conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices; conspiracy to commit money laundering
Mandatory life in prison
OSCAR NOE MEDINA GONZALEZ, a/k/a “Panu”
39
Continuing criminal enterprise; fentanyl importation conspiracy; fentanyl distribution conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices; conspiracy to commit money laundering
Mandatory life in prison
NESTOR ISIDRO PEREZ SALAS, a/k/a “Nini”
31
Continuing criminal enterprise; fentanyl importation conspiracy; fentanyl distribution conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices; conspiracy to commit money laundering
Mandatory life in prison
JORGE HUMBERTO FIGUEROA BENITEZ, a/k/a “27”
31
Continuing criminal enterprise; fentanyl importation conspiracy; fentanyl distribution conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices; conspiracy to commit money laundering
Mandatory life in prison
LIBORIO NUNEZ AGUIRRE, a/k/a “Karateca”
65
Fentanyl importation conspiracy; fentanyl distribution conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices; conspiracy to commit money laundering
Life in prison; mandatory minimum of 40 years in prison
NOEL PEREZ LOPEZ, a/k/a “Tio”
42
Fentanyl importation conspiracy; fentanyl distribution conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices; conspiracy to commit money laundering
Life in prison; mandatory minimum of 40 years in prison
SAMUEL LEON ALVARADO
34
Fentanyl importation conspiracy; fentanyl distribution conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices; conspiracy to commit money laundering
Life in prison; mandatory minimum of 40 years in prison
LUIS JAVIER BENITEZ ESPINOZA, a/k/a “El Fourteen”
22
Fentanyl importation conspiracy; fentanyl distribution conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices; conspiracy to commit money laundering
Life in prison; mandatory minimum of 40 years in prison
ALAN GABRIEL NUNEZ HERRERA
29
Fentanyl importation conspiracy; fentanyl distribution conspiracy; conspiracy to commit money laundering
Life in prison; mandatory minimum of 10 years in prison
JUAN PABLO LOZANO, a/k/a “Camaron”
30
Fentanyl importation conspiracy; fentanyl distribution conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices; conspiracy to commit money laundering
Life in prison; mandatory minimum of 40 years in prison
CARLOS LIMON
19
Fentanyl importation conspiracy; fentanyl distribution conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices; conspiracy to commit money laundering
Life in prison; mandatory minimum of 40 years in prison
JESUS TIRADO ANDRADE
26
Fentanyl importation conspiracy; fentanyl distribution conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices; conspiracy to commit money laundering
Life in prison; mandatory minimum of 40 years in prison
CARLOS OMAR FELIX GUTIERREZ
22
Fentanyl importation conspiracy; fentanyl distribution conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices; conspiracy to commit money laundering
Life in prison; mandatory minimum of 40 years in prison
SILVANO FRANCISCO MARIANO, a/k/a “Rayo”
41
Fentanyl importation conspiracy; fentanyl distribution conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices; conspiracy to commit money laundering
Life in prison; mandatory minimum of 40 years in prison
JULIO MARIN GONZALEZ
32
Fentanyl importation conspiracy; fentanyl distribution conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices; conspiracy to commit money laundering
Life in prison; mandatory minimum of 40 years in prison
MARIO ALBERTO JIMENEZ CASTRO, a/k/a “Kastor”
34
Fentanyl importation conspiracy; fentanyl distribution conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices; conspiracy to commit money laundering
Life in prison; mandatory minimum of 40 years in prison
SERGIO DUARTE FRIAS
26
Fentanyl importation conspiracy; fentanyl distribution conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices; conspiracy to commit money laundering
Life in prison; mandatory minimum of 40 years in prison
ANA GABRIELA RUBIO ZEA, a/k/a “Gaby”
32
Fentanyl importation conspiracy; fentanyl distribution conspiracy; conspiracy to commit money laundering
Life in prison; mandatory minimum of 10 years in prison
KUN JIANG
Unknown
Fentanyl importation conspiracy; fentanyl distribution conspiracy; conspiracy to commit money laundering
Life in prison; mandatory minimum of 10 years in prison
YONGHAO WU, a/k/a “Tim”
31
Fentanyl importation conspiracy; fentanyl distribution conspiracy; conspiracy to commit money laundering
Life in prison; mandatory minimum of 10 years in prison
YAQIN WU, a/k/a “Lily”
30
Fentanyl importation conspiracy; fentanyl distribution conspiracy; conspiracy to commit money laundering
Life in prison; mandatory minimum of 10 years in prison
HUATAO YAO, a/k/a “Yao”
32
Fentanyl importation conspiracy; fentanyl distribution conspiracy; conspiracy to commit money laundering
Life in prison; mandatory minimum of 10 years in prison
United States v. Leobardo Garcia Corrales, et al., S2 23 Cr. 136
Defendant
Age
Charges
Minimum and Maximum Penalties
LEOBARDO GARCIA CORRALES, a/k/a “Leo”
53
Fentanyl importation conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices
Life in prison; mandatory minimum of 40 years in prison
MARTIN GARCIA CORRALES, a/k/a “Tano,” a/k/a “Cachuchas”
43
Fentanyl importation conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices
Life in prison; mandatory minimum of 40 years in prison
HUMBERTO BELTRAN CUEN, a/k/a “Don Chino”
69
Fentanyl importation conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices
Life in prison; mandatory minimum of 40 years in prison
ANASTACIO SOTO VEGA, a/k/a “Tachin”
45
Fentanyl importation conspiracy; possession of machineguns and destructive devices; conspiracy to possess machineguns and destructive devices
Life in prison; mandatory minimum of 40 years in prison
[1] As the introductory phrase signifies, the entirety of the text of the Indictments and the description of the Indictments set forth herein constitute only allegations, and every fact described should be treated as an allegation.
Two South Florida Residents Indicted for Stealing Millions in COVID-19 Relief FundsRead the Press Release
MIAMI – A federal magistrate judge in Fort Lauderdale has unsealed an indictment today charging Carl Henry Charles, 43, of Miramar, Fla., and Patrick Charles, 41, of Lake Worth, Fla., for fraudulently obtaining millions of dollars in COVID-19 pandemic relief loans and advances from the Small Business Administration (SBA) through the Economic Injury Disaster Loan (EIDL) program.
According to the indictment, from March 2020 through December 2021, Carl Charles and his brother, Patrick Charles, submitted applications to the SBA for EIDL program loans seeking nearly $5 million for purported businesses that did not exist before the start of the COVID-19 pandemic and did not have any revenue or other business activity. As a result of the false and fraudulent applications, the SBA disbursed approximately $2.5 million in loan proceeds and advances to the defendants, who in turn used the funds to enrich themselves and others.
The indictment charges each defendant with multiple counts of wire fraud. If convicted, Carl Charles faces up to 80 years in prison and Patrick Charles faces up to 60 years in prison. A federal district court judge will determine any sentence after considering U.S. Sentencing Guidelines and other statutory factors.
U.S. Attorney Markenzy Lapointe for the Southern District of Florida; Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division; Special Agent in Charge Jeffrey B. Veltri of the FBI, Miami Field Office; Special Agent in Charge Mark H. Morini Jr. of the U.S. Treasury Inspector General for Tax Administration (TIGTA), Southern Field Division; and Special Agent in Charge Amaleka McCall-Brathwaite, U.S. Small Business Administration Office of Inspector General (SBA-OIG), Investigations Division’s Eastern Region, made the announcement.
FBI Miami, TIGTA, and SBA-OIG investigated the case. Assistant U.S. Attorney David Snider for the Southern District of Florida and Trial Attorneys Samad Pardesi and Ariel Glasner of the Criminal Division’s Fraud Section are prosecuting it. Assistant U.S. Attorney Emily Stone 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.
In March 2020, the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act was enacted. It was designed to provide emergency financial assistance to the millions of Americans suffering the economic effects caused by the COVID-19 pandemic. Among other sources of relief, the CARES Act authorized and provided funding to the SBA to provide Economic Injury Disaster Loans (“EIDLs”) to eligible small businesses, including sole proprietorships and independent contractors, experiencing substantial financial disruptions due to the COVID-19 pandemic to allow them to meet financial obligations and operating expenses that could otherwise have been met had the disaster not occurred. EIDL applications were submitted directly to the SBA via the SBA’s on-line application website, and the applications were processed and the loans funded for qualifying applicants directly by the SBA.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
On September 15, 2022, the Attorney General selected the Southern District of Florida’s U.S. Attorney’s Office to head one of three national COVID-19 Fraud Strike Force Teams. The Department of Justice established the Strike Force to enhance existing efforts to combat and prevent COVID-19 related financial fraud. The Strike Force combines law enforcement and prosecutorial resources and focuses on large-scale, multistate pandemic relief fraud perpetrated by criminal organizations and transnational actors, as well as those who committed multiple instances of pandemic relief fraud. The Strike Force uses prosecutor-led and data analyst-driven teams to identify and bring to justice those who stole pandemic relief funds. For more information on the department’s response to the pandemic, please click here.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
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-60072.
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Two Men Sentenced to 30 and 46 Months in Prison for Scheme to Defraud New York City Program for Homeless VeteransRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that JEROME WEAH was sentenced today in Manhattan federal court to 46 months in prison for engaging in a scheme to defraud a program of the New York City Human Resources Administration (“HRA”), which provides cash assistance to homeless veterans of the United States armed services (“Veterans”) seeking permanent housing. Another defendant, RUDEAN WEIR, was sentenced to 30 months in prison on March 30, 2023, for his participation in the scheme. The sentences were imposed by United States District Judge Denise L. Cote.
U.S. Attorney Damian Williams said: “Rudean Weir and Jerome Weah stole approximately $5.4 million from a New York City program intended to benefit U.S. veterans seeking permanent housing. These sentences should send a message that individuals who abuse Government programs to enrich themselves at the expense of taxpayers will face serious consequences.”
As alleged in the Complaint, Informations, and other documents in the public record, as well as statements made in public court proceedings:
From at least October 2020 through at least May 2022, RUDEAN WEIR and JEROME WEAH submitted more than 340 fraudulent applications seeking cash assistance pursuant to the Enhanced One Shot Deal (“EOSD”) program administered by the HRA. The EOSD is an emergency assistance program pursuant to which HRA makes a one-time cash assistance payment to qualifying individuals. EOSD payments are often used to help individuals move out of homeless shelters and/or other temporary housing into permanent housing. EOSD payments may be used to cover certain costs associated with the move to permanent housing, including rent, moving expenses, security deposits, broker’s fees, and payments for furniture and other household items. The HRA also offers and administers services and programs for Veterans, sometimes referred to as “Veteran’s Initiatives.” In connection with these services, the HRA has a designated group responsible for receiving and reviewing EOSD requests made on behalf of homeless Veterans seeking permanent housing.
Between October 2020 and May 2022, the HRA received at least 340 EOSD applications which claimed that the applicants were homeless Veterans who had entered into a lease agreement with a particular landlord (“Landlord-1”). Each of these applications (the “Landlord-1 EOSD Applications”) claimed that a particular company provided broker’s services in connection with the lease agreement (“Broker Company-1”). HRA paid approximately $5.4 million in EOSD payments and broker’s fees pursuant to the Landlord-1 EOSD Applications.
The Landlord-1 EOSD Applications were fraudulent. Landlord-1 and the Veterans did not, in fact, enter into the lease agreements submitted to HRA in connection with the Landlord-1 EOSD Applications, and Broker Company-1 did not provide real estate brokerage services to either Landlord-1 and/or the Veterans. The Veterans identified in the Landlord-1 EOSD Applications were not homeless and typically did not live in New York City. The Landlord-1 EOSD Applications, therefore, contained fake documentation and information and fraudulently induced HRA into making EOSD payments.
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In addition to the prison terms, both WEIR, 38, of Atlanta, Georgia, and WEAH, 47, of Trenton, New Jersey, were sentenced to three years of supervised release and ordered to pay restitution in the amount of $5,388,769.60. WEIR was ordered to forfeit $3,779,489.00, including his interest in two bank accounts and six real estate properties. WEAH was ordered to forfeit $2,179,922.60, including his interest in two bank accounts and one real estate property.
Mr. Williams praised the outstanding investigative work of the New York City Department of Investigation. Mr. Williams also thanked the New York City Department of Social Services and the U.S. Department of Veterans Affairs, Office of Inspector General for their assistance.
This case is being handled by the Office’s General Crimes Unit. Assistant U.S. Attorney Matthew Weinberg is in charge of the prosecution.
Tucson Man Sentenced for Coordinating Alien Smuggling ConspiracyRead the Press Release
TUCSON, Ariz. – Adrian Duran-Estrada, 39, of Tucson, Arizona, was sentenced last week by United States District Judge Jennifer G. Zipps to 120 months in prison, followed by three years of supervised release. Judge Zipps also ordered Duran-Estrada to pay a $200 special assessment and a $20,000 money judgment. Duran-Estrada pleaded guilty to Conspiracy to Transport Illegal Aliens and Unlawful Possession of a Firearm by a Convicted Felon.
From at least May 2019 through May 2021, Duran-Estrada conspired with co-defendants to transport undocumented non-citizens in southern Arizona. As the coordinator and leader of the conspiracy, he used WhatsApp, text messages, and voice calls to coordinate the movement of undocumented non-citizens. Examples of Duran-Estrada’s actions in furtherance of the conspiracy include:
- On May 30, 2019, Duran-Estrada coordinated the transport of 10 undocumented non-citizens, who were later apprehended by Border Patrol agents on Highway 286 near Sasabe, Arizona. Later that same day, a juvenile co-conspirator became lost and died in the desert east of Highway 286 while attempting to guide another group of undocumented non-citizens at the direction of Duran-Estrada.
- About one week later, on June 7, 2019, Duran-Estrada coordinated with co-defendant Bruce Rivera to pick up two undocumented non-citizens near San Miguel, Arizona, including providing Rivera with GPS coordinates to locate the two individuals. Although Rivera traveled to a location near San Miguel intending to pick up the two undocumented non-citizens, he was stopped by Border Patrol agents before he was able to pick them up.
- On July 23, 2019, Duran-Estrada coordinated with co-defendants Kaitlan Cox and Arturo Alday Cordova to pick up a group of undocumented non-citizens near Sasabe, Arizona.
In addition, a May 4, 2021, search of his residence revealed evidence that, in November 2020, Duran-Estrada knowingly possessed a .22 caliber rifle that he used to poach a deer on the Buenos Aires National Wildlife Refuge. At the time Duran-Estrada possessed the firearm, he was a convicted felon, having previously been convicted of two separate felony offenses.
Duran-Estrada’s co-defendants, Kaitlan Cox, Arturo Alday Cordova, and Bruce Rivera, were previously convicted of Conspiracy to Transport Illegal Aliens, Conspiracy to Transport Illegal Aliens, and Attempted Transportation of Illegal Aliens, respectively, for their involvement in the conspiracy. Cox was sentenced to 27 months in prison; Cordova was sentenced to eight months in prison; and Rivera was sentenced to a term of three years’ probation.
Homeland Security Investigations and Customs and Border Protection’s United States Border Patrol conducted the investigation in this case, with assistance from the Bureau of Alcohol, Tobacco, Firearms and Explosives. The United States Attorney’s Office, District of Arizona, Tucson, handled the prosecution.
CASE NUMBER: CR-21-0883-TUC-JGZ (BGM)
RELEASE NUMBER: 2023- 053_Duran-Estrada# # #
For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.St. Louis Man Indicted on Gun, Fentanyl ChargesRead the Press Release
ST. LOUIS – A man arrested by police after a shooting in St. Louis was indicted in U.S. District Court this week on gun and fentanyl possession charges.
Robert Eutz III, 43, was indicted Wednesday on five felonies: two counts of possession with the intent to distribute fentanyl, possession of a firearm in furtherance of a drug trafficking crime and two counts of being a felon in possession of a firearm. The crimes are alleged to have occurred on February 1 and 21 of 2022 and March 30, 2023.
A criminal complaint filed March 31 says officers with the St. Louis Metropolitan Police Department were called to a shooting in the 3500 block of Lafayette Avenue on March 30 and were told that someone in an older model Chrysler shot a victim multiple times. Police also were given a partial license plate number. Police stopped a Chrysler with a license plate matching that number a short distance away, and arrested Eutz, who was identified as the shooter by a witness. Eutz also had ammunition, spent cartridges and a safe in the car.
A motion seeking to have Eutz held in jail until trial says he has a pending drug charge in St. Louis Circuit Court related to a February 2022 arrest, in which he is alleged to have possessed a large quantity of fentanyl.
The felon in possession charges carry a potential penalty of up to 10 years in prison, and the fentanyl charge carries a 20-year maximum. The possession of a firearm in furtherance of a drug trafficking crime charge carries a mandatory minimum term of at least five years in prison, consecutive to the other charges.
Charges set forth in an indictment or a criminal complaint are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
The case was investigated by the St. Louis Metropolitan Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Jennifer Szczucinski is prosecuting the case.
Son of Murder Victim and a Co-Conspirator Sentenced to Life in Prison for Murder-for-Hire Committed at McDonald's Drive-ThruRead the Press Release
Earlier today, at the federal courthouse in Brooklyn, Anthony Zottola, Sr. and Himen Ross were sentenced by United States District Judge Hector Gonzalez to mandatory life imprisonment plus 112 years for their roles in the October 4, 2018 killing of 71-year-old Sylvester Zottola, the father of Anthony Zottola, Sr. The additional years represent 41 years for Salvatore Zottola’s age when he was shot and 71 years for Sylvester Zottola’s age when he was killed. In October 2022, following a six-week trial, a federal jury found the defendants guilty of murder-for-hire, conspiracy to commit murder-for-hire, and firearms offenses.
Breon Peace, United States Attorney for the Eastern District of New York and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI) announced the sentence.
“Over the course of more than a year, the elderly victim, Sylvester Zottola, was stalked, beaten, and stabbed, never knowing who orchestrated the attacks. It was his own son, who was so determined to control the family’s lucrative real estate business, that he hired a gang of hit men to murder his father,” stated United States Attorney Peace. “For sentencing his father to a violent death, Anthony Zottola and his co-defendant will spend the rest of their lives in prison. I commend our prosecutors, the FBI Special Agents and NYPD detectives for their tremendous investigative work solving this cold-blooded crime and bringing the defendants to justice.”
“Today’s sentence justly punishes Mr. Zottola and Mr. Ross to life imprisonment for their roles in the heartless murder of Sylvester Zottola. The FBI and the NYPD worked relentlessly to investigate this case and ensure the defendants paid the price for their senseless actions. Today’s result is a direct reflection of their effort, as well as that of the skilled and dedicated professionals from the Eastern District of New York who prosecuted the case,” stated Assistant Director-in-Charge Driscoll.
Sylvester Zottola controlled a residential real estate portfolio consisting of multi-family rental properties that was valued at tens of millions of dollars at the time of his death. Defendant Anthony Zottola helped manage his father Sylvester Zottola’s real estate business by maintaining the properties, collecting rent, and helping to run A&S Maintenance, a company that was jointly owned by Anthony and his brother Salvatore Zottola. Anthony Zottola plotted to kill his father and his brother so that he could take control of the family business.
As proven at trial, Anthony Zottola hired co-conspirator Bushawn Shelton to kill his father and his brother, Salvatore. Shelton recruited others to commit the murders, and together they engaged in a year-long conspiracy to carry out a series of violent attacks against Sylvester and Salvatore Zottola. Among other attempts, on November 26, 2017, Sylvester Zottola was menaced at gunpoint by a masked individual. On December 27, 2017, three men invaded Sylvester Zottola’s residence, struck him on the head with a gun, stabbed him multiple times, and slashed his throat. Zottola survived the attack. Then on July 11, 2018, a gunman shot Salvatore Zottola in the head, chest, and hand in front of his residence. Zottola survived the shooting.
The conspirators placed a tracking device on Sylvester Zottola’s car, allowing Ross to track him to a McDonald’s restaurant on Webster Avenue in the Bronx where Ross fatally shot the victim multiple times while the victim waited to pick up a cup of coffee in the drive-through. Ross and Shelton exchanged texts immediately after the hit, and then Shelton and Anthony Zottola exchanged texts, in which Anthony was informed that his father had just been murdered. Shelton texted Anthony Zottola: “Can we party today or tomorrow?” Anthony Zottola assured Shelton that he would have Shelton’s payment for carrying out the murder ready soon: “I have the cases of water in a day or so.” A photograph later recovered from one of Shelton’s cellular telephones shows a cardboard box of bottled water, as well as over $200,000 in banded currency.
Shelton pleaded guilty in August 2022 to murder-for-hire conspiracy and murder-for-hire. He is awaiting sentencing. Co-defendants Herman Blanco, Arthur Codner, Jason Cummings, and Branden Peterson previously pleaded guilty and were sentenced to 240 months’ imprisonment, 228 months’ imprisonment, 204 months’ imprisonment, and 192 months’ imprisonment, respectively.
The government’s case is being handled by the Office’s Organized Crime and Gangs Section. Assistant United States Attorneys Kayla C. Bensing, Emily J. Dean, Devon Lash, and Andrew M. Roddin are in charge of the prosecution, with the assistance of paralegal specialist Brittany Wissel. Assistant United States Attorney Brian Morris assisted with forfeiture matters.
The Defendants:
HIMEN ROSS (also known as “Ace” and “A Boggie”)
Age: 37
Bronx, New YorkANTHONY ZOTTOLA, SR.
Age: 45
Larchmont, New YorkDefendants Who Previously Pleaded Guilty:
HERMAN BLANCO (also known as “Taliban” and “L”)
Age: 38
Bronx, New YorkARTHUR CODNER (also known as “Feddi,” “Feddi Bossgod,” and “Scary”)
Age: 34
New Hampton, New YorkJASON CUMMINGS (also known as “The Hat” and “Stacks”)
Age: 34
Brooklyn, New YorkKALIK MCFARLANE (also known as “Dottkom” and “Dot”)
Age: 40
Brooklyn, New YorkBUSHAWN SHELTON (also known as “Shelz”)
Age: 38
Brooklyn, New YorkJULIAN SNIPE (also known as “Biz” and “Bizzzy”)
Age: 37
Bronx, New YorkE.D.N.Y. Docket No. 18-CR-609 (S-3) (HG)
Sioux City Man Sentenced to 7 Years in Federal Prison for RobberyRead the Press Release
A Sioux City, Iowa man who brutally robbed a marijuana dealer was sentenced April 5, 2023, to 7 years in federal prison for robbery.
Alejandro Bautista, age 21, from Sioux City, Iowa, received the prison term after an October 24, 2022, guilty plea.
Evidence in the case showed that on October 28, 2020, Bautista tricked a marijuana dealer into allowing him into his home to buy marijuana. Once inside, Bautista shouted a signal and armed gunman entered the home. The marijuana dealer, a 20-year old man, his brother and girlfriend were home at the time, where they were restrained, beaten, brutalized and robbed of marijuana, cash, a firearm and other valuables.
Bautista was sentenced in Sioux City by United States District Court Chief Judge Leonard T. Strand to 84 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. Bautista is being held in the United States Marshal’s custody until he can be transported to a federal prison.
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 21-04029.
Follow us on Twitter @USAO_NDIA.
Sioux City Man Back to Prison for Violating Federal Supervised ReleaseRead the Press Release
A man who violated the terms of his federal supervised release was sentenced April 7, 2023, to more than one year in federal prison.
Rahmaan El Herman, 41, from Sioux City, Iowa, received the prison term after a Judge found him guilty of violating the terms and conditions of his supervised release. El Herman was sentenced in October 2008 to 180 months imprisonment with 5 years of supervised release following for his conviction of conspiracy to manufacture and distribute crack cocaine.
Evidence at the hearings showed El Herman violated multiple conditions of his supervised release which included multiple failures to report for drug testing and possessing a firearm during an assault of another person.
El Herman was sentenced in Sioux City by United States District Court Chief Judge Leonard T. Strand. El Herman was sentenced to 12 months’ plus one day imprisonment. He must also serve a one-year term of supervised release after the prison term. There is no parole in the federal system.
El Herman is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Shawn S. Wehde and investigated by the U.S. Probation Office and the Sioux City Police Department.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 04-4042. Follow us on Twitter @USAO_NDIA.
Silk Road Dark Web Fraud Defendant Sentenced Following Seizure and Forfeiture of over $3.4 Billion in CryptocurrencyRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that JAMES ZHONG was sentenced today to one year and one day in prison for committing wire fraud in September 2012 when he unlawfully obtained approximaely 50,000 Bitcoin from the Silk Road dark web internet marketplace. United States District Judge Paul G. Gardephe imposed today’s sentence.
As part of the ZHONG investigation, the Government has obtained final orders of forfeiture for, among other items, 51,680.32473733 Bitcoin, valued at over $3.4 billion at the time of seizure and over $1.57 billion today.
U.S. Attorney Damian Williams said: “Back in 2012, James Zhong committed wire fraud by stealing 50,000 Bitcoin from Silk Road, and for the next 10 years, he managed to conceal what he had done and how he obtained his fortune. Zhong used a decentralized Bitcoin mixer, an overseas cryptocurrency exchange, and an impressive array of technological tools to frustrate tracing efforts. But thanks to the relentless and skillful efforts of law enforcement in following the money, the federal government uncovered Zhong’s scheme and obtained final orders of forfeiture for over 51,680 Bitcoin. Cyber-criminals should heed this message: we will follow the money and hold you accountable, no matter how sophisticated your scheme and no matter how long it takes.”
According to court filings and statements made in court proceedings:
ZHONG’s Scheme to Defraud
Silk Road was an online “darknet” black market. In operation from approximately 2011 until 2013, Silk Road was used by numerous drug dealers and other unlawful vendors to distribute massive quantities of illegal drugs and other illicit goods and services to many buyers and to launder all funds passing through it. In 2015, following a groundbreaking prosecution by this Office, Silk Road’s founder Ross Ulbricht was convicted by a unanimous jury and sentenced to life in prison. United States v. Ulbricht, 14-cr-68 (S.D.N.Y.).
In September 2012, ZHONG executed a scheme to defraud Silk Road of its money and property by (i) creating a string of approximately nine Silk Road accounts (the “Fraud Accounts”) in a manner designed to conceal his identity; (ii) triggering over 140 transactions in rapid succession in order to trick Silk Road’s withdrawal-processing system into releasing approximately 50,000 Bitcoin from its Bitcoin-based payment system into ZHONG’s accounts; and (iii) transferring this Bitcoin into a variety of separate addresses also under ZHONG’s control, all in a manner designed to prevent detection, conceal his identity and ownership, and obfuscate the Bitcoin’s source.
While executing the September 2012 fraud, ZHONG did not list any item or service for sale on Silk Road, nor did he buy any item or service on Silk Road. ZHONG registered the accounts by providing the bare minimum of information required by Silk Road to create the account; the Fraud Accounts were merely a conduit for ZHONG to defraud Silk Road of Bitcoin.
ZHONG funded the Fraud Accounts with an initial deposit of between 200 and 2,000 Bitcoin. After the initial deposit, ZHONG then quickly executed a series of withdrawals. Through his scheme to defraud, ZHONG was able to withdraw many times more Bitcoin out of Silk Road than he had deposited in the first instance. As an example, on September 19, 2012, ZHONG deposited 500 Bitcoin into a Silk Road wallet. Less than five seconds after making the initial deposit, ZHONG executed five withdrawals of 500 Bitcoin in rapid succession — i.e., within the same second — resulting in a net gain of 2,000 Bitcoin. As another example, a different Fraud Account made a single deposit and over 50 Bitcoin withdrawals before the account ceased its activity. ZHONG moved this Bitcoin out of Silk Road and, in a matter of days, consolidated them into two high-value amounts.
Nearly five years after ZHONG’s fraud, in August 2017, solely by virtue of ZHONG’s possession of the 50,000 Bitcoin that he unlawfully obtained from Silk Road, ZHONG received a matching amount of a related cryptocurrency — 50,000 Bitcoin Cash (“BCH Crime Proceeds”) — on top of the 50,000 Bitcoin. In August 2017, in a hard fork coin split, Bitcoin split into two cryptocurrencies, traditional Bitcoin and Bitcoin Cash (“BCH”). When this split occurred, any Bitcoin address that had a Bitcoin balance (as ZHONG’s addresses did) now had the exact same balance on both the Bitcoin blockchain and on the Bitcoin Cash blockchain. As of August 2017, ZHONG thus possessed 50,000 BCH in addition to the 50,000 Bitcoin that ZHONG unlawfully obtained from Silk Road. ZHONG thereafter exchanged through an overseas cryptocurrency exchange all of the BCH Crime Proceeds for additional Bitcoin, amounting to approximately 3,500 Bitcoin of additional crime proceeds. Collectively, by the last quarter of 2017, ZHONG thus possessed approximately 53,500 Bitcoin of total crime proceeds (the “Crime Proceeds”).
The Government’s Seizure of Over 50,000 Bitcoin
On November 9, 2021, pursuant to a judicially authorized premises search warrant, law enforcement agents recovered approximately 50,491.06251844 Bitcoin of crime proceeds from ZHONG’s Gainesville, Georgia, house. Law enforcement located these crime proceeds in an underground floor safe and on a single-board computer that was submerged under blankets in a popcorn tin stored in a bathroom closet. In addition, law enforcement recovered $661,900 in cash, 25 Casascius coins (physical bitcoin) with an approximate value of 174 Bitcoin, 11.1160005300044 additional Bitcoin, four one-ounce silver-colored bars, three one-ounce gold-colored bars, four 10-ounce silver-colored bars, and one gold-colored coin. Photographs of the popcorn tin, single-board computer, underground floor safe, and some of the seized items are included below:
Beginning in or around March 2022, ZHONG began voluntarily surrendering to the Government additional Bitcoin that ZHONG had access to and had not dissipated. In total, ZHONG voluntarily surrendered 1,004.14621836 additional Bitcoin.
Using a conservative estimate of the lowest spot price of Bitcoin on the seizure dates, the total value of all Bitcoin seized for which the Government has obtained final orders of forfeiture is approximately $3.4 billion.
Forfeiture Actions
On February 7, 2023, in United States v. Ross Ulbricht, S1 14 Cr. 68 (S.D.N.Y.), District Judge Lorna G. Schofield entered a final order of forfeiture as to the below property seized from ZHONG, vesting all right, title, and interest in the below property in the United States:
- 50,491.06251844 Bitcoin seized from ZHONG’s home on November 9, 2021;
- 825.38833159 Bitcoin provided by ZHONG on March 25, 2022; and
- 35.4470080 Bitcoin provided by ZHONG on May 25, 2022.
On March 14, 2023, District Judge Gardephe entered a final order of forfeiture as to the below property, vesting all right, title, and interest in the below property in the United States:
- ZHONG’s 80% interest in RE&D Investments, LLC, a Memphis-based company with substantial real estate holdings;
- $661,900 in United States currency seized from ZHONG’s home on November 9, 2021;
- Metal items, consisting of four one-ounce silver-colored bars, three one-ounce gold-colored bars, four 10-ounce silver-colored bars, and one gold-colored coin, all seized from ZHONG’s home on November 9, 2021;
- 11.1160005300044 Bitcoin seized from ZHONG’s home on November 9, 2021;
- 25 Casascius coins (physical Bitcoin) with an approximate value of 174 Bitcoin, collectively, seized from ZHONG’s home on November 9, 2021;
- 23.7112850 Bitcoin provided by ZHONG on April 27, 2022;
- 115.02532155 Bitcoin provided by ZHONG on April 28, 2022; and
- 4.57427222 Bitcoin provided by ZHONG on June 8, 2022.
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ZHONG, 32, of Gainesville, Georgia, and Athens, Georgia, previously pled guilty to one count of wire fraud before Judge Gardephe.
Mr. Williams praised the outstanding work of the Internal Revenue Service, Criminal Investigation’s Western Cyber Crimes Unit of the Los Angeles Field Office. Mr. Williams also thanked the Athens-Clarke County Police Department in Athens, Georgia, for its support and assistance with the case.
The prosecution of this case is being overseen by the Office’s Money Laundering and Transnational Criminal Enterprises Unit. Assistant U.S. Attorney David R. Felton is in charge of the case.
Seven New England Fishermen Charged with Tax Evasion and Failing to File ReturnsRead the Press Release
Federal grand juries in Providence, Rhode Island, and Boston returned separate indictments charging seven commercial fishermen with tax evasion and failing to file returns.
According to the indictments, the commercial fishermen each worked for fishing companies operating primarily out of New Bedford, Massachusetts, or Point Judith, Rhode Island, and received substantial compensation. The companies allegedly paid the fishermen as independent contractors and documented that income by, among other things, filing Forms 1099 with the IRS that reported the funds paid to the fishermen. It is alleged that notwithstanding the receipt of this income, each fisherman did not file individual tax returns or pay all the taxes owed on that income – for some defendants, they allegedly failed to file and/or pay taxes for a decade or more. To conceal the source and disposition of their income, the fishermen allegedly cashed paychecks and then used the cash to fund their lifestyles. One of the defendants allegedly also used the name and Social Security number of another individual to conduct business as a further effort to hide income. In some instances, the fishermen allegedly filed false tax returns for certain years by either not reporting their fishing income or by reporting false business expense deductions to reduce the amount of taxes they owed. Each allegedly evaded tax on between $900,000 and $1.9 million in income.
The seven fishermen indicted are:
Jorge Cazarin of New Bedford, Massachusetts, was charged with five counts of tax evasion and five counts of willful failure to file tax returns for 2016 through 2020.
Christopher Garraty of Newport and East Greenwich, Rhode Island, was charged with three counts of tax evasion and three counts of willful failure to file for 2016 through 2018, and a fourth count of tax evasion related to taxes he allegedly owed for 2007 through 2011.
Wojciech Kaminski of West Warwick, Rhode Island, was charged with five counts of tax evasion for 2014 and 2016 through 2019 and four counts of willful failure to file tax returns for 2016 through 2019.
Brian Kobus of Durham, Connecticut, was charged with five counts of tax evasion for 2017 through 2021.
Rodolfo Membreno of Fall River, Massachusetts, was charged with six counts of tax evasion for 2012 and 2017 through 2021 and four counts of willful failure to file tax returns for 2017 through 2019 and 2021.
John Doe of New Bedford, Massachusetts, was charged with six counts of tax evasion for 2016 through 2021 and three counts of willful failure to file tax returns for 2016 through 2018.
Miguel Cruz Rubio of New Bedford, Massachusetts, and Elizabethtown, North Carolina, was charged with four counts of tax evasion for 2016 through 2019.
If convicted, each defendant faces a maximum sentence of five years in prison for each evasion count and one year in prison for each failure to file a tax return charge. 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 thanked U.S. Attorney Rachael S. Rollins for the District of Massachusetts and U.S. Attorney Zachary A. Cunha for the District of Rhode Island for their help and assistance in the investigation and prosecution of these cases.
IRS-Criminal Investigation is investigating these cases.
Assistant Chief John Kane and Trial Attorneys Samuel Bean, Matthew Cofer, Christina Grimes, and Ezra Spiro of the Justice Department’s Tax Division are prosecuting the cases.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
San Juan Man Indicted and Arrested for Coercion and Enticement of a MinorRead the Press Release
SAN JUAN, Puerto Rico – A federal grand jury returned an indictment charging Samuel Vega-Rodríguez, 42, of San Juan, Puerto Rico, with coercion and enticement of a minor and attempted production of child pornography, announced W. Stephen Muldrow, U.S. Attorney for the District of Puerto Rico. The arrest follows an investigation by Homeland Security Investigations (HSI) with the assistance of the Puerto Rico Police Bureau (PRPB) and the U.S. Attorney’s Office for the District of Puerto Rico.
According to the indictment, from May to September 2022, Samuel Vega-Rodríguez knowingly persuaded, induced, enticed, and coerced a 13-year-old female minor to engage in sexual activity. The man was arrested at his residence without incident on April 6.
According to court documents, the defendant began conversations via social media with the minor victim. In said conversations, the defendants talked about sex and asked for naked photos and videos of the minor victim. In May 2022, the defendant and the minor agreed to meet for a sexual encounter. When the minor victim saw Vega-Hernández and realized that the defendant was older than the male depicted in his social media accounts, the female minor left the meeting point running, after she punched him and kicked him when he attempted to stop her from leaving.
“We want to remind the community that the U.S. Attorney’s Office along with our federal, state and local partners, are committed to protecting children from these types of criminals,” said U.S. Attorney Muldrow. “If you are a victim or know of another victim of this individual, please come forward; contact the authorities so we can protect you and others from these crimes.”
“The Puerto Rico Crimes Against Children Task Force, led by HSI brings together local, state and federal law enforcement agencies with the common goal of investigating and arresting individuals that prey on our children,” said Rebecca C. González, Acting Special Agent in Charge of HSI San Juan.
Today, Vega-Rodríguez had his arraignment and bail hearing before U.S. Magistrate Judge Giselle López-Soler and was ordered to remain at the Guaynabo Metropolitan Detention Center awaiting the outcome of his case.
If convicted, Vega-Rodríguez faces a mandatory minimum penalty of 10 years up to life for the coercion and enticement charge, and a minimum of 15 years up to 30 years in prison for the production of child exploitation material charge. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant United States Attorney Daynelle Álvarez-Lora, of the Child Exploitation and Immigration Unit, is in charge of the prosecution of this case.
HSI is the principal investigative arm of DHS and a vital U.S. asset in combatting transnational crimes and threats. One of HSI’s top priorities is to protect the public from crimes of victimization, and HSI’s child exploitation investigations program is a central component of this mission. HSI is recognized as a global leader in this investigative discipline, and is committed to utilizing its vast authorities, international footprint and strong government and non-government partnerships to identify and rescue child victims, identify and apprehend offenders, prevent transnational child sexual abuse and help make the internet a safer place for children.
For more information about HSI’s efforts to protect children from online sexual abuse, visit https://www.ice.gov/topics/iGuardians.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
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Salvadoran Man Convicted of Illegally Reentering U.S. After RemovalRead the Press Release
RICHMOND, Va. – A federal jury convicted a citizen of El Salvador today of illegally reentering the United States after a prior removal.
According to court records and evidence presented at trial, Victor Manuel Romero-Diaz, 40, of El Salvador, was removed from the United States on December 12, 2011, after he was convicted of a felony offense for cocaine possession and distribution. In October 2022, immigration authorities found Romero-Diaz living in North Chesterfield, without having obtained permission to apply for reentry into the United States.
Romero-Diaz faces a maximum penalty of 10 years in prison when sentenced on September 5, 2023. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia, and Russell Hott, Field Office Director, for U.S. Department of Homeland Security’s Enforcement and Removal Operations (ERO) Washington, D.C., made the announcement after U.S. District Judge David J. Novak accepted the verdict.
The Department of Justice’s Office of International Affairs and the Department of Justice’s Organized Crime and Gang Section provided assistance in this case. The Dirección General de Migración y Extranjería of El Salvador also provided significant assistance.
Assistant U.S. Attorneys Carla Jordan-Detamore and Kaitlin G. Cooke are prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:22-cr-177.
Rochester Resident Arrested, Charged with Production and Possession of Child PornographyRead the Press Release
ROCHESTER, N.Y.-U.S. Attorney Trini E. Ross announced today that Matthew Richardson a/k/a Skylar “Sky” Ravenwood, 35, of Rochester, NY, was arrested and charged by criminal complaint with production and distribution of child pornography. The charge carries a mandatory minimum penalty of 15 years in prison, a maximum of 30 years, and a 250,000 fine.
Assistant U.S. Attorney Meghan K. McGuire, who is handling the case, stated that according to the complaint, in November 2022, the Greece Police Department received a report that a 16-year-old minor (minor victim) was missing, and that the minor victim had been seeing a person named “Sky.” Greece Police contacted “Sky” by telephone, who confirmed that he was with the minor victim. Greece Police also spoke with the minor victim who would not provide their location and stated that they did not want to return home. As a result, the minor victim was registered as a missing person in a law enforcement database. In early December 2022, Greece Police learned that Richardson and the minor victim were in an OnlyFans video and reached out to the FBI, which located the sexually explicit video. On December 9, 2022, Richardson and the minor victim were located by Ohio State Troopers in a vehicle Richardson had stolen in New York State. Richardson was arrested at that time.
Richardson made an initial appearance before U.S. Magistrate Judge Mark W. Pedersen and was held pending a detention hearing on April 18, 2023, at 1:00 p.m.
The complaint is the result of an investigation by the Greece Police Department, under the direction of Chief Michael Wood, the Federal Bureau of Investigation Child Exploitation Human Trafficking Task Force, under the direction of Special Agent-in-Charge Matthew Miraglia, New York State Police, under the direction of Major Brian J. Ratajczak, and the Monroe County Sheriff’s Office, under the direction of Sheriff Todd Baxter.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
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Quincy Man Sentenced to 12 Years for Child Pornography OffenseRead the Press Release
Spokane – On April 12, 2023, U.S. District Judge Thomas O. Rice sentenced Sergio Bonilla
Henriquez, 24, of Quincy, Washington, to 144 months in federal prison for Receipt of Child
Pornography. Defendant pleaded guilty on January 11, 2023. Judge Rice also ordered
Henriquez to pay $48,000 in restitution to his victims and be federally supervised for life after
Henriquez is released from prison.According to court documents and proceedings, Henriquez was identified as a child exploitation suspect after he used various names to engage in several online chat groups dedicated to the trading of child pornography. Within the chat groups, Henriquez distributed and received child pornography files depicting minors of all ages and engaged in explicit discussions detailing his sexual interest in minors and encouraging the sex abuse of minors by others. After a federal search warrant was executed at Henriquez’s residence, forensic review of his phone revealed more than 26,000 images and videos of child pornography.
Court documents further reveal that, after being granted pretrial release from custody, Henriquez uploaded child pornography to outgoing communications in Snapchat, which led to the execution of another federal search warrant at Henriquez’s residence. Investigators found minors living in the residence and Henriquez in possession of firearms, which were violations of his release conditions. They also discovered additional evidence of child pornography on Defendant’s electronic devices.
“The significant sentence imposed in this case recognizes the ongoing and lasting harm caused by child exploitation. It also sends a strong message to Mr. Henriquez and others who use what they believe to be online anonymity to exploit the most vulnerable among us,” said United States
Attorney Vanessa R. Waldref. “I commend the collaborative, hand-in-glove investigation and prosecution of this case by the child exploitation agents at Homeland Security Investigations and
AUSA Ann Wick, who is one of the most experienced and thoughtful child exploitation prosecutors in the District.”“Child predators like Mr. Henriquez cannot be allowed to engage in these kinds of depraved acts, whether in person or online,” said Steven Schrank, Deputy Special Agent in Charge of HSI operations in the Pacific Northwest. “Child exploitation cases can be among the most heart-wrenching in all of law enforcement, but this investigation shows our commitment to finding justice for underage victims and their families.”
This case was investigated by Homeland Security Investigations, with the assistance of the Grant
County Sheriff’s Office, and prosecuted by Ann T. Wick, Assistant United States Attorney for the Eastern District of Washington.2:20-CR-100-TOR
Previously Convicted Felon Pleads Guilty to Drug Trafficking and Unlawful Possession of Firearms and AmmunitionRead the Press Release
CONCORD – A Manchester man pleaded guilty in federal court to drug trafficking and firearm offenses, U.S. Attorney Jane E. Young announces.
John Rivera, 24, pleaded guilty to unlawful possession with the intent to distribute quantities of fentanyl and cocaine base, commonly known as “crack” cocaine, and being a prohibited person in possession of a firearm and ammunition. U.S. District Court Judge Joseph LaPlante scheduled sentencing for July 25, 2023. Rivera was charged on March 11, 2022.
On September 16, 2021, the New Hampshire State Police, working in conjunction with the Manchester Police Department, observed a firearm under Rivera’s driver’s seat during a traffic stop. Upon searching the vehicle, officers seized 1.2 kilograms of fentanyl packaged for distribution, approximately 19.68 grams of crack cocaine, a stolen firearm, a loaded magazine, loose ammunition, drug packaging materials, and a digital scale. Rivera is prohibited from possessing firearms and ammunition based on a prior felony conviction.
The charging statute provides a sentence of no greater than 20 years in prison, 3 years of supervised release, and a fine of $1,000,000. 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.
The Manchester Police Department and the New Hampshire State Police led the investigation. Assistant U.S. Attorney Jennifer C. Davis is prosecuting the case.
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Podiatrist and Patient Recruiter Convicted for $8.5M Compounding Fraud SchemeRead the Press Release
A federal jury convicted two Texas men today for their role in a scheme to fraudulently bill TRICARE – the health care program for U.S. service members and their families – for compounded creams that were medically unnecessary and procured through kickbacks and bribes.
According to court documents and evidence presented at trial, Brian Carpenter, 56, of Bridgeport, was a podiatrist who signed prescriptions for compounded pain and scar creams for TRICARE beneficiaries to whom he never spoke and whom he never examined or treated. Jerry Lee Hawrylak, 69, of Lake Worth, recruited Carpenter to sign the prescriptions and recruited TRICARE beneficiaries to accept the medically unnecessary creams. From November 2014 to January 2017, Carpenter and Hawrylak caused the Fort Worth-based pharmacy involved in the conspiracy to fraudulently bill TRICARE approximately $8.5 million for these creams.
Carpenter and Hawrylak were convicted of one count of conspiracy to commit health care fraud and six counts of health care fraud. They are scheduled to be sentenced on Aug. 23 and face a maximum penalty of 10 years in prison on each count. 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 Leigha Simonton for the Northern District of Texas, Special Agent in Charge Michael Mentavlos of the Defense Criminal Investigative Service (DCIS), Special Agent in Charge Jason Meadows of the Department of Health and Human Services Office of Inspector General (HHS-OIG) Dallas Regional Office, Special Agent in Charge Chad B. Yarbrough of the FBI Dallas Regional Office, Special Agent in Charge Steven Grell of the Department of Labor Office of Inspector General (DOL-OIG) Central Regional Office, and Special Agent in Charge Kris Raper of the Veterans Affairs Office of Inspector General (VA-OIG) South Central Field Office made the announcement.
The DCIS, HHS-OIG, FBI, DOL-OIG, and VA-OIG investigated the case.
Acting Assistant Chief Brynn A. Schiess and Trial Attorneys Lee Hirsch and Andrea Savdie 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.
Plaquemines Parish Man Sentenced to 190 Months for Violations of the Federal Controlled Substances ActRead the Press Release
NEW ORLEANS, LOUISIANA – U.S. Attorney Duane A. Evans announced today that CARL BLAKE RILEY, JR., age 47, a resident of Plaquemines Parish, was sentenced on April 13, 2023 to 190 months imprisonment, 5 years of supervised release, and a $200 mandatory special assessment fee by U.S. District Judge Eldon E. Fallon, after he pled guilty to a two-count indictment charging him with possession with the intent to distribute methamphetamine and possession with the intent to distribute heroin, in violation of Title 21, United States Code, Sections 841(a)(1), 841(b)(1)(A), and 841(b)(1)(C).
According to court documents, during a search of RILEY’s home, police found approximately 880 grams of methamphetamine and approximately 25 grams of heroin. RILEY received the narcotics from California and distributed them in the Plaquemines Parish area.
This case was investigated by the U.S. Drug Enforcement Administration and the Plaquemines Parish Sheriff’s Office. The prosecution was handled by Assistant United States Attorney J. Benjamin Myers of the Narcotics Unit.
Owner of the Sportsmans Grille in Williamsburg Charged with Tax FraudRead the Press Release
NEWPORT NEWS, Va. – A federal grand jury returned an indictment charging a Williamsburg man with nine counts of tax fraud.
According to the indictment, Stephen G. Genakos, 62, is the sole owner and managing director of Sarantos, Inc., a Virginia Subchapter S corporation that does business as a restaurant, the Sportsmans Grille, in James City County. The indictment alleges that since 2016, Genakos skimmed more than $670,000 in U.S. currency from the Sportsmans Grille. During this period, he is alleged to have deposited more than $112,000 in currency in his personal bank accounts and gambled more than $502,000 with the Virginia Lottery.
The indictment further alleges that in 2020, Genakos listed the Sportsmans Grille for sale. In 2021, undercover agents from the Internal Revenue Service (IRS) made contact with Genakos. During this operation, Genakos allegedly joked about his “magic book” and ultimately provided IRS agents the chance to view the true books and records of the Sportsmans Grille.
The indictment further alleges that for tax years 2016 through 2020, Genakos filed materially false tax returns for himself and his business, Sarantos Inc. He is charged with filing nine returns that understate his taxable income by more than $670,000 and caused a tax loss to the United States of approximately $113,163.
Genakos is charged with aiding and assisting in the preparation of materially false tax returns. If convicted, Genakos faces a maximum of 3 years in prison on each of the nine counts. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia, and Kareem A. Carter, IRS Criminal Investigation Acting Special Agent in Charge of the Washington D.C. Field Office, made the announcement.
Assistant U.S. Attorneys Mack Coleman and Brian Samuels are prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:23-cr-37.
An indictment is merely an accusation. The defendant is presumed innocent until proven guilty.
Oswego County Woman Pleads Guilty to Charges Related to Theft of Social Security BenefitsRead the Press Release
SYRACUSE, NEW YORK – Lisa Waldron, age 44, of Palermo, New York, pled guilty today to eleven counts of Theft of Government Property, announced United States Attorney Carla B. Freedman and Sharon B. MacDermott, Special Agent in Charge of the Social Security Administration (SSA), Office of the Inspector General, New York Field Office.
The charges to which Waldron pled guilty relate to her theft of Supplemental Security Income (“SSI”) benefits intended for her disabled son, Jordan Brooks, while Waldron was acting as Brooks’s representative payee. A representative payee is a person or organization who receives Social Security benefits on another person’s behalf and is required to ensure the benefits are used only to support the beneficiary.
As part of her guilty plea, Waldron admitted that, after Brooks died on May 9, 2021, Waldron continued to receive SSI benefits intended for Brooks. Instead of properly notifying SSA of the issue and knowing she was not entitled to Brooks’s benefit payments, Waldron nonetheless used Brooks’s SSI benefits to pay her own personal expenses until SSA independently learned of the issue and terminated Brooks’s benefits.
Unrelated to the federal charges to which Waldron pled guilty today, Waldron is also facing state murder charges related to her involvement in Brooks’s death.
On the federal charges, Waldron faces a maximum term of imprisonment of ten years, a fine of up to $250,000, and a term of supervised of up to three years. As part of her plea agreement, Waldron has also agreed to pay full restitution. She is scheduled to be sentenced on August 22, 2023, by Chief United States District Judge Brenda K. Sannes in Syracuse, New York.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 the Social Security Administration Office of the Inspector General and is being prosecuted by Assistant U.S. Attorney Adrian S. LaRochelle and Special Assistant U.S. Attorney Paul J. Tuck.
North Carolina Woman Admits Participating in Health Care Fraud SchemeRead the Press Release
NEWARK, N.J. – A North Carolina woman today admitted her role in a health care fraud conspiracy in which she paid for doctors’ orders for durable medical equipment (DME), namely orthotic braces, Attorney for the United States Vikas Khanna announced.
Ircania Vargas, 50, of Charlotte, North Carolina, pleaded guilty by videoconference before U.S. District Judge Kevin McNulty to an information charging her with one count of conspiracy to commit health care fraud.
According to documents filed in this case and statements made in court:
Vargas owned and operated various entities in New Jersey, through which she obtained doctors’ orders for DME. From December 2017 through May 2019, Vargas agreed to pay an individual and others a set amount for each DME order for a back, knee, shoulder or ankle brace provided to her DME supply companies. Vargas then billed Medicare for the DME orders that she obtained in exchange for kickbacks. Vargas observed indicators that these DME orders were not medically necessary, in part because Medicare beneficiaries would frequently call to complain that they had not ordered the DME that they received. To disguise the scheme, Vargas put her companies in the names of nominee owners, including her sisters and a friend. Vargas also received sham invoices which indicated that her companies had performed “marketing services” for an individual, when in reality, the invoices were for kickback payments for the purchase of DME orders. Vargas’s scheme resulted in an actual loss to Medicare of at least $5.5 million.
Conspiracy to commit health care fraud carries a maximum potential punishment of 10 years in prison and a fine of $250,000 or twice the gross gain or loss from the offense, whichever is greatest. Sentencing is scheduled for Sept. 12, 2023.
Attorney for the United States Khanna credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark; and the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Acting Special Agent in Charge Naomi Gruchacz, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Emma Spiro of the Economic Crimes Unit in Newark.
vargas.information.pdfNine Defendants Sentenced in $126M Compounding Fraud SchemeRead the Press Release
Nine defendants – including three compounding pharmacy owners, a physician, two pharmacists, and three patient recruiters – were sentenced yesterday for their respective roles in a years-long, multi-state scheme to defraud the Department of Labor’s Office of Workers’ Compensation Programs (OWCP) and TRICARE, the health care program for U.S. service members and their families.
The sentences include:
- John Cruise, 52, of Houston, a former co-owner of Assurance Consolidated Pharmacy (ACP), a pharmacy located in Spring, Texas, as well as an owner of the Injured Federal Workers Advocate Association (IFWAA), an organization that purported to assist injured federal workers, was sentenced to 20 years in prison.
- LaShonia Johnson, 50, of Houston, a former co-owner of ACP with her husband and co-defendant Cruise, and director at IFWAA, was sentenced to 15 years in prison.
- Kenny Ozoude, 48, of Houston, former owner of Compounding Solutions LLC, a Houston-based pharmacy, was sentenced to 10 years in prison.
- James Don Jackson, 63, of Tyler, Texas, a medical doctor licensed in Texas, was sentenced to five years in prison.
- Nirvana Hightower, 56, of Houston, a pharmacist licensed in Texas and pharmacist-in-charge at Compounding Solutions LLC, was sentenced to five years in prison.
- Keith Hudson, 55, of Humble, Texas, a pharmacist licensed in Texas and pharmacist-in-charge at ACP, was sentenced to 3 years in prison.
- Audra Jones, 46, of Houston, was sentenced to two years and six months in prison.
- Terrance Aice, 50, of Carrollton, Texas, a patient recruiter, was sentenced to one year and six months in prison.
- Sherod Johnson, 44, of Las Vegas, a patient recruiter, was sentenced to one year and six months in prison.
The defendants submitted false and fraudulent claims to the OWCP and TRICARE for prescriptions for compounded and other drugs prescribed to injured federal workers and members of the armed forces. The defendants also paid kickbacks to patient recruiters and physicians to prescribe these drugs. The defendants chose the particular compounds and other drugs based not on the patients’ medical needs but in light of the amount of reimbursement for the drugs. The drugs were then mailed to patients, even though the patients often never requested, wanted, or needed them.
Four additional defendants (Dr. Jay Bender, Dr. Deepak Chavda, Donathan Kemp, and Naresh Jivanji) are scheduled to be sentenced on May 25.
Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, U.S. Attorney Alamdar S. Hamdani for the Southern District of Texas, Special Agent in Charge Jonathan Ulrich of the U.S. Postal Service Office of Inspector General (USPS-OIG), Special Agent in Charge Steve Grell of the Department of Labor Office of Inspector General (DOL-OIG), Special Agent in Charge Michael Mentavlos of the Department of Defense Office of Inspector General (DOD-OIG), and Special Agent in Charge Kris Raper of the Department of Veteran’s Affairs Office of Inspector General (DVAO-OIG) South Central Field Office made the announcement.
The USPS-OIG, DOD-OIG, and DOL-OIG investigated the case with assistance from the DVAO-OIG.
Trial Attorneys Catherine Wagner and Patrick J. Queenan of the Criminal Division’s Fraud Section prosecuted the case. Assistant Chief Scott Armstrong, Assistant Chief John “Fritz” Scanlon, Trial Attorney Michael McCarthy, and former Trial Attorneys Jay McCormack and Sarah Edwards of the Fraud Section previously prosecuted the case.
Nicaraguan National Pleads Guilty for Illegal Re-EntryRead the Press Release
NEW ORLEANS – ALEXANDER JOSUE REYES-RAMIREZ (“REYES-RAMIREZ”), age 37, pled guilty to a one-count indictment on April 13, 2023 for illegal reentry of a removed alien in violation of Title 8, United States Code, Section 1326(a), announced U.S. Attorney Duane A. Evans.
According to court documents, REYES-REMIREZ admitted to reentering the United States after being previously deported on July 24, 2019. REYES-RAMIREZ faces a maximum term of imprisonment of two years, a maximum fine of up to $250,000, a maximum term of supervised release of up to one year, and a mandatory $100 special assessment fee.
U.S. Attorney Evans praised the work of the United States Immigration and Customs Enforcement in investigating this matter. Assistant U.S. Attorney Carter K.D. Guice, Jr. of the General Crimes Unit is in charge of the prosecution.
New York Man Indicted in St. Louis, Accused of Selling Counterfeit Xanax on Dark WebRead the Press Release
ST. LOUIS – A man from New York state has been indicted in federal court in St. Louis and accused of selling counterfeit Xanax on the dark web.
John Cruz, 29, of Rochester, was indicted March 1 on one count of conspiracy to misbrand, introduce misbranded drugs and sell counterfeit drugs. He was arrested March 15 and appeared in U.S. District Court in St. Louis Friday by Zoom. He has pleaded not guilty to the charge.
The indictment alleges that using cryptocurrency, Cruz bought bulk quantities of counterfeit generic alprazolam, an anti-anxiety drug, from another person on the dark web who has sold millions of the pills. That person manufactured the pills using active drug ingredients from China, a pill press and stamps that would mimic the markings used on pills produced by manufacturers licensed and approved by the U.S. Food and Drug Administration. The pills were delivered to Cruz in Rochester, New York and he then redistributed the pills to various customers, the indictment alleges.
The charge is punishable by up to five years in prison, a $250,000 fine or both.
Charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
The case was investigated by the FBI, the Drug Enforcement Administration, the U.S. Postal Inspection Service and U.S. Immigration and Customs Enforcement. Assistant U.S. Attorneys John Ware and Kyle Bateman are prosecuting the case.
New Orleans Man Sentenced After Conviction at Trial for Violating the Federal Controlled Substances ActRead the Press Release
NEW ORLEANS, LOUISIANA – GEORGE BENNETT, aka “G,” age 40, from the greater New Orleans area, was sentenced on April 13, 2023 by United States District Judge Eldon E. Fallon to one hundred twenty-one (121) months’ imprisonment followed by a term of ten (10) years’ supervised release and a mandatory $300.00 special assessment fee after his conviction at trial for violating the Federal Controlled Substances Act, announced U.S. Attorney Duane A. Evans.
After a four-day trial in November 2022, the jury found BENNETT guilty of conspiracy to distribute and possess with the intent to distribute one-hundred (100) grams or more of heroin and a quantity of fentanyl, in violation of Title 21, United States Code, Sections 841(a)(1), 841(b)(1)(B), and 846, distribution of a quantity of heroin and a quantity of fentanyl, and possession with intent to distribute a quantity of heroin and a quantity of fentanyl, both in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(C).
The case was investigated by the Federal Bureau of Investigation New Orleans Gang Task Force and the Jefferson Parish Sheriff’s Office. It was prosecuted by Assistant United States Attorneys André Jones, Melissa Bücher, and Christopher D. Usher of the Narcotics Unit.
Nampa Man Pleads Guilty to Federal Felony for Selling over $4.4 Million in Unapproved Steroid-Like DrugsRead the Press Release
BOISE – Michael Terry Little, 51, of Nampa, pleaded guilty to introduction of unapproved new drugs in interstate commerce, U.S. Attorney Josh Hurwit announced today.
According to court records, Little ran a business selling Selective Androgen Receptor Modulators (SARMs). Little primarily sold SARMs products via a website, https://sarm.tech under the name SARMTECH. SARMs are synthetic chemicals designed to mimic the effects of testosterone and other anabolic steroids. SARMs are “new drugs” under the Food, Drug, and Cosmetic Act (FDCA) and therefore not approved for sale. Little knew the SARMs products were not FDA approved.
Little manufactured his SARMs products at a business in Nampa. There, he processed the bulk ingredients he imported from China—encapsulating, bottling, and preparing them for shipment. To avoid government seizures of SARMs shipped to other countries, Little offered a stealth shipping option for an additional fee that intentionally mispackaged and falsely declared SARMs shipments as vitamins and supplements. Law enforcement made multiple undercover purchases of SARMs products from SARMTECH, including products containing Ostarine (MK-2866), Ligandrol (LGD-4033), and other SARMs compounds. Between March 2018 and January 2022, little sold at least $4,499,197.46 of SARMs products.
Little is scheduled to be sentenced on July 11, 2023 and faces a maximum penalty of three years in federal prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
“I am grateful to the team of attorneys and law enforcement agents who unraveled this illegal and dangerous scheme,” said U.S. Attorney Hurwit. “We are committed to protecting the public from those who sell unapproved drugs, especially when the ingredients used are imported from China without any way to verify their safety.”
“Unapproved drugs that are sold online present serious risks to consumers,” said Special Agent in Charge Robert M. Iwanicki, FDA Office of Criminal Investigations Los Angeles Field Office. “We will continue to investigate and bring to justice those whose actions threaten the public health.”
U.S. Attorney Hurwit credited the cooperative efforts of the Food and Drug Administration Office of Criminal Investigations, Homeland Security Investigations, and the U.S. Department of Commerce Bureau of Industry and Security Office of Export Enforcement, which led to the charges.
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Mexican Man Sentenced for Using Social Security Number to Obtain EmploymentRead the Press Release
NEW ORLEANS, LOUISIANA – MARIO MATEO TOMAS JOSE, a native of Mexico, was sentenced on April 13, 2020 for illegally using a social security number to qualify for employment, in violation of Title 42, United States Code, Section 408(a)(7)(B), announced United States Attorney Duane A. Evans.
United States District Court Judge Eldon E. Fallon sentenced JOSE to (1) one year of probation and a mandatory special assessment fee of $100.00.
According to court documents, on March 29, 2022, Homeland Security Investigations received information that certain individuals had used fraudulent Social Security cards in an initial application to obtain employment. Prior to finalizing employment with their prospective company, the individuals had to report to the Gulf Coast Safety Council, which provides safety courses to applicants applying to work with companies servicing petrochemical processing plants. On March 30, 2022, TOMAS JOSE arrived at the Gulf Coast Safety Council office in St. Rose, Louisiana to complete the safety course to finalize his employment with Company “A”. On that day, TOMAS JOSE presented a fraudulent United States Social Security card bearing the name and United States Social Security number of a United States citizen, which he represented to be his own, in order to obtain employment.
U.S. Attorney Evans praised the work of Homeland Security Investigations in investigating this matter. Assistant United States Attorney Jon M. Maestri is in charge of the prosecution.
Martin County Man Convicted of Producing and Receiving Child PornographyRead the Press Release
PIKEVILLE, Ky. - A Beauty, Ky., man was convicted on Wednesday. by a federal jury sitting in Pikeville. of six counts of child pornography-related offenses.
After two hours of deliberation, following a three-day trial, the jury convicted Donald York, 60, for four counts of the production of child pornography and two counts of receiving child pornography.
According to the evidence presented, York used a minor female victim to engage in sexually explicit conduct, for the purpose of producing images of that conduct. The United States further established that York uploaded some of the victim’s photos to a pornographic website.
York was indicted in June 2022.
Carlton S. Shier, IV, United States Attorney for the Eastern District of Kentucky; Jodi Cohen, Special Agent in Charge, FBI Louisville Field Office; Col. Phillip Burnett, Commissioner, Kentucky State Police; and Sheriff John Kirk, Martin County Sherriff’s Office, jointly announced the conviction.
The investigation was conducted by FBI, KSP, and the Martin County Sherriff’s Office. The United States was represented in the case by Assistant U.S. Attorneys Justin Blankenship and Jason Parman.
York will appear for sentencing on August 24, 2023. He faces a minimum of five years, up to 20 years in prison, on each count of conviction. However, the Court must consider the U.S. Sentencing Guidelines and the applicable federal sentencing statutes before imposing a sentence.
This case was prosecuted as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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Man Convicted of Defrauding Elderly Widow of $1.2 MillionRead the Press Release
NASHVILLE – After a week-long trial, a federal jury this week, convicted Karl Hampton, 65, of Chattanooga, Tennessee, of twelve felony counts related to a scheme to defraud an elderly widow of over one million dollars, announced United States Attorney Henry C. Leventis.
Hampton and his wife were indicted in 2021 for conspiracy and money laundering and Hampton was also charged with wire and mail fraud.
At trial, the evidence showed that Hampton met the victim while he was working as an exterminator in her home. Between 2018 and 2020, Hampton tricked the victim into believing that he would care for her personally and financially. He held himself out as the victim’s “personal representative,” her “son” or her “godson,” and pretended that he was acting on her behalf.
In April 2019, Hampton convinced the victim to sign over her Power of Attorney and to name him in her Revocable Living Trust and in her will. He then methodically drained the victim’s bank accounts, took out a $500,000 line of credit in her name using her property as collateral, and amassed huge charges on her credit cards for his own personal expenses.
In total, Hampton defrauded the victim of approximately $1.2 million. He used her money to purchase luxury items and often spent over $1,000 per day on lottery tickets. The defendant’s lavish spending using the victim’s money included purchasing a Lexus GX460, a 4.3-karat diamond ring, and a $170,000 interest in a pest control business.
Sentencing is scheduled for August 11, 2023. The defendant’s wife pleaded guilty to one count of money laundering in February 2023 and will be sentenced on June 16, 2023.
This case was investigated by the FBI. Assistant U.S. Attorneys Kathryn Booth and Brent Hannafan prosecuted the case.
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Maine Man Charged in Connection with Portsmouth School ThreatRead the Press Release
CONCORD – A Maine man has been federally charged in connection with posting a video on SnapChat that threatened the Portsmouth High School on April 12, 2023, U.S. Attorney Jane E. Young announces.
Kyle Hendrickson, 25, was charged with transmitting in interstate commerce a threat to injure the person of another. A press release will be issued when an initial appearance in federal court is scheduled.
According to the charging documents, Hendrickson posted a video to his SnapChat account on Wednesday, April 12, 2023, in which he brandished a handgun while in a vehicle outside of the Portsmouth High School. The video includes a text overlay that reads “imma shoot up the school.” School surveillance footage placed Hendrickson’s vehicle outside the high school at the time of the video.
Hendrickson was arrested yesterday on state charges. A subsequent state search warrant of the vehicle yielded an AR-15 rifle, a shotgun, camouflage body armor, a handgun holster, a red-dot sight, and numerous rounds of ammunition. Investigators recovered another shotgun inside a residence associated with Hendrickson. Finally, a handgun that resembles the one used in the SnapChat video was recovered in a motel where Hendrickson had stayed on April 12, 2023.
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.
The Federal Bureau of Investigation, Boston Division, and the Portsmouth Police Department led the investigation. The Federal Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Somersworth Police Department, the Portland (Maine) Police Department, and the Berwick (Maine) Police Department provided valuable assistance. Assistant U.S. Attorney Charles L. Rombeau 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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Leesburg Convicted Felon Sentenced to 15 Years in Federal Prison for Illegally Possessing A FirearmRead the Press Release
Ocala, Florida – Senior United States District Judge Gregory A. Presnell has sentenced Timothy Eric Evans (41, Leesburg) under the Armed Career Criminal Act to 15 years in federal prison for possessing a firearm as a convicted felon. The court also ordered the forfeiture of the handgun and ammunition used in the offense. Evans had pleaded guilty on June 8, 2022.
According to court documents, on May 21, 2021, officers from the Tavares Police Department discovered Evans in possession of a stolen vehicle. During a search of the vehicle, officers located MDMA and a loaded handgun in the center console. Evans admitted that the MDMA belonged to him but denied possessing the firearm. An analysis of Evans’s cellphone revealed a large volume of messages and images of illegal narcotics and firearms, including messages in which Evans tried to buy and sell firearms.
Evans has eight prior state felony convictions, including attempted strongarm robbery (1998), robbery with a firearm (1998), aggravated assault with a deadly weapon (1998), strongarm robbery (2003), attempted second-degree murder (2008), possession of a firearm by a convicted felon (2008), sale of cocaine (2008), and possession of cocaine (2020). Therefore, he is prohibited from possessing firearms or ammunition under federal law.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
This case was investigated by the Tavares Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. It was prosecuted by Assistant United States Attorney Hannah Nowalk.
Justice Department Announces Charges Against Sinaloa Cartel’s Global OperationRead the Press Release
The Justice Department today announced charges unsealed in the Southern District of New York, Northern District of Illinois, and District of Columbia, against several leaders of the Sinaloa Cartel, a transnational drug trafficking organization based in Sinaloa, Mexico, and its facilitators across the globe.
“Today, the Justice Department is announcing significant enforcement actions against the largest, most violent, and most prolific fentanyl trafficking operation in the world – run by the Sinaloa Cartel, and fueled by Chinese precursor chemical and pharmaceutical companies,” said Attorney General Merrick B. Garland. “Families and communities across our country are being devastated by the fentanyl epidemic. Today’s actions demonstrate the comprehensive approach the Justice Department is taking to disrupt fentanyl trafficking and save American lives.”
“The fentanyl crisis in America – fueled in large part by the Sinaloa cartel – threatens our public health, our public safety, and our national security,” said Deputy Attorney General Lisa O. Monaco. “Today’s indictments target every element of the Sinaloa Cartel's trafficking network and reflect the Justice Department's commitment to attacking every aspect of this threat: from the chemical companies in China that spawn fentanyl precursors, to the illicit labs that produce the poison, to the networks and money launderers and murderers that facilitate its distribution. Just as we have gone on offense against terrorists and cyber criminals around the globe, the Department is now waging a relentless campaign to disrupt the production and trafficking of fentanyl – before it can reach its victims.”
“Today’s indictments send a clear message to the Chapitos, the Sinaloa Cartel, and criminal drug networks around the world that the DEA will stop at nothing to protect the national security of the United States and the safety and health of the American people,” said DEA Administrator Anne Milgram. “The Chapitos pioneered the manufacture and trafficking of fentanyl – the deadliest drug threat our country has ever faced – flooded it into the United States for the past eight years and killed hundreds of thousands of Americans. Over the last year and a half, the DEA proactively infiltrated the Sinaloa Cartel and the Chapitos network, obtained unprecedented access to the organization’s highest levels, and followed them across the world. I am grateful to the men and women of the DEA for their exceptional work on this case, which is the beginning of our work as ‘One DEA’ to dismantle every part of the criminal cartels that are killing Americans at record rates.”
“Far too many Americans have become victims in the national fentanyl crisis. These cartels have shown us they will stop at nothing to manufacture, traffic, and push these dangerous drugs to every corner of our country,” said FBI Director Christopher Wray. “Today’s indictments show that the FBI and our law enforcement partners will never tire in our pursuit not only to shut down their criminal enterprises, but also to go after individuals in their network. I want to thank the FBI team continuing to work on these cases everyday as we join with our law enforcement partners to tackle this national epidemic.”
“This indictment is another example of how this administration is taking on the cartels and their transnational criminal networks, and sending a clear message that we are going to hold them accountable,” said Secretary of Homeland Security Alejandro N. Mayorkas. “I commend our workforce at Homeland Security Investigations and our federal partners who are relentless in their efforts to stop the scourge of fentanyl. Today’s announcement exemplifies a whole-of-government approach to protecting our homeland that is yielding results.”
The Sinaloa Cartel is one of the most powerful drug cartels in the world and is largely responsible for the manufacturing and importing of fentanyl for distribution in the United States. Fentanyl is a dangerous synthetic opioid that is more than 50 times more potent than heroin. Fentanyl is now the leading cause of death for Americans ages 18 to 49, and it has fueled the opioid epidemic that has been ravaging families and communities across the United States for approximately the past eight years. Between 2019 and 2021, fatal overdoses increased by approximately 94%, with an estimated 196 Americans dying each day from fentanyl.
The Sinaloa Cartel operated as an affiliation of drug traffickers and money launderers who obtain precursor chemicals – largely from China – for the manufacture of synthetic drugs, manufacture drugs in Mexico, move those drugs into the United States, and collect, launder, and transfer the proceeds of drug trafficking. Once led by Joaquin Guzman Loera, aka El Chapo, and Ismael Zambada Garcia, aka El Mayo, the Sinaloa Cartel’s members and associates – allegedly including the sons of Guzman Loera, collectively known as the Chapitos – smuggled significant quantities of drugs through Mexico and into the United States. The Chapitos are Ivan Guzman Salazar, 40, Alfredo Guzman Salazar, 37, Joaquin Guzman Lopez, 36, and Ovidio Guzman Lopez, 33.
Following Guzman Loera’s arrest in January 2016 and extradition to the United States in January 2017, the Chapitos allegedly assumed their father’s former role as leaders of the Sinaloa Cartel, along with Zambada Garcia and Damaso Lopez Nunez, aka Licenciado. The Chapitos subsequently amassed greater control over the Sinaloa Cartel by allegedly threatening and causing violence against Lopez Nunez, his family, and his associates and, as a result, became principal leaders and drug traffickers within the Sinaloa Cartel.
The indictments being unsealed today demonstrate that the Sinaloa Cartel has been engaged in drug trafficking activities into the United States, and violence, spanning over a decade and a half. The Chapitos are alleged to have repeatedly and consistently transported lethal amounts of cocaine, heroin, methamphetamine, and fentanyl.
The Chapitos allegedly used cargo aircraft, private aircraft, submarines and other submersible and semi-submersible vessels, container ships, supply vessels, go-fast boats, fishing vessels, buses, rail cars, tractor trailers, automobiles, and private and commercial interstate and foreign carriers to transport their drugs and precursor chemicals. They allegedly maintained a network of couriers, tunnels, and stash houses throughout Mexico and the United States to further their drug-trafficking activities. The Chapitos allegedly used these networks to import the drugs into the United States.
Southern District of New York
Fentanyl trafficking, weapons, and money laundering charges were unsealed today in the Southern District of New York against 28 defendants, including three of the Chapitos; top lieutenants and leadership of the Sinaloa Cartel; alleged manufacturers and distributors of the Sinaloa Cartel’s fentanyl; the managers of the violent armed security apparatus that protects the Sinaloa Cartel’s drug trafficking operations; the sophisticated money launderers who repatriate the Sinaloa Cartel’s drug proceeds back to Mexico; and multiple chemical precursor suppliers in China that fuel the Sinaloa Cartel’s fentanyl distribution operation.
According to court documents, Ivan Guzman Salazar, Alfredo Guzman Salazar, Ovidio Guzman Lopez, and their co-conspirators allegedly controlled extensive, multi-faceted, and international operations covering the fentanyl trade. Through these efforts, the Chapitos and the Sinaloa Cartel allegedly reaped hundreds of millions of dollars in profits by flooding the United States with fentanyl.
Seven defendants are in custody pending extradition proceedings.
Ovidio Guzman Lopez is charged in a separate indictment alleging the same offenses.
The DEA investigated the case with assistance from the Department of Treasury’s Office of Foreign Assets Control and the Department of State’s Rewards for Justice Program.
Assistant U.S. Attorneys Kyle A. Wirshba, Nicholas S. Bradley, Sarah L. Kushner, David J. Robles, and Alexander Li for the Southern District of New York are prosecuting the case. The Justice Department’s Office of International Affairs (OIA) provided substantial assistance.
Northern District of Illinois
Narcotics, money laundering, and firearms charges were unsealed today in the Northern District of Illinois against four of the Chapitos: Ivan Guzman Salazar, Alfredo Guzman Salazar, Joaquin Guzman Lopez, and Ovidio Guzman Lopez.
According to court documents, the charges stem from a decades-long, collaborative, multi-district effort between the Criminal Division’s Narcotic and Dangerous Drug Section (NDDS), the Northern District of Illinois, the Southern District of California, and their law enforcement partners. The indictment alleges that between May 2008 and April 5, 2023, the Chapitos operated a drug trafficking Continuing Criminal Enterprise (CCE), along with additional drug, money laundering, and firearms charges.
Ovidio Guzman Lopez is charged in a separate indictment alleging the same offenses, dating from May 2008 until October 2021, when Mexican authorities arrested him on Jan. 5 in Culiacan, Sinaloa, Mexico. Ovidio Guzman Lopez remains detained in Mexico pending extradition proceedings.
The FBI Washington Field Office and San Diego Field Office, Homeland Security Investigations Nogales Office, DEA’s Chicago Division and San Diego Division, and IRS Criminal Investigations Chicago Office are investigating the case.
Acting Deputy Chief Katharine Wagner and Trial Attorney Kirk Handrich of NDDS, Assistant U.S. Attorneys Andrew Erskine and Erika Csicsila for the Northern District of Illinois, and Assistant U.S. Attorney Matthew Sutton for the Southern District of California are prosecuting the case. OIA provided substantial assistance.
This case is supported by the Organized Crime Drug Enforcement Task Forces (OCDETF).
District of Columbia
Narcotics, firearms, and witness retaliation charges were unsealed today in the District of Columbia against Nestor Isidro Perez Salas, aka Nini, 31, allegedly one of the Chapitos’ lead sicarios, or assassins.
According to court documents, Perez Salas is allegedly a leader and commander of the “Ninis,” a violent group charged with providing security for the Chapitos. From at least 2012 until February 2021, Perez Salas allegedly conspired to distribute and manufacture cocaine and methamphetamine for unlawful importation into the United States, used a firearm in furtherance of the alleged drug-trafficking offense, and killed, attempted to kill, threatened, and caused bodily injury to another to intimidate a government witness and informant.
The FBI Washington Field Office is investigating the case.
Trial Attorneys Kirk Handrich and Kate Naseef of the Criminal Division’s Narcotic and Dangerous Drug Section are prosecuting the case.
This case is supported by the OCDETF.
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The U.S. Department of State, through its Narcotics Rewards Program, is offering rewards of up to $10 million for information leading to the arrest and/or conviction of Ivan Guzman Salazar, Alfredo Guzman Salazar, and Ovidio Guzman Lopez, and up to $5 million for information leading to the arrest and/or conviction of Joaquin Guzman Lopez.
Attorney General Merrick B. Garland, Deputy Attorney General Lisa O. Monaco, FBI Director Christopher A. Wray, DEA Administrator Anne Milgram, Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, U.S. Attorney Damian Williams for the Southern District of New York, U.S. Attorney Randy Grossman of the Southern District for California, Acting U.S. Attorney Morris Pasqual for the Northern District of Illinois, and Acting Deputy Director PJ Lechleitner of the U.S. Immigration and Customs Enforcement (ICE) made the announcement.
Photos of the fugitives can be obtained at www.dea.gov/fugitives.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Informational: Federal Court arraignmentsRead the Press Release
The U.S. Attorney’s Office announced that the following persons were arraigned or appeared this week before U.S. Magistrate judges on indictments handed down by the Grand Jury or on criminal complaints. The charging documents are merely accusations and defendants are presumed innocent until proven guilty:
Appearing in Billings before U.S. Magistrate Judge Timothy J. Cavan and pleading not guilty on April 13 was:
Jesse Ray Blackman, 40, of Billings, on charges of interstate threats and cyberstalking. If convicted of the most serious crime, Blackman faces a maximum of five years in prison, a $250,000 fine and three years of supervised release. Blackman was detained pending further proceedings. The FBI and Blackfeet Law Enforcement Services, with assistance from the Yellowstone County Sheriff’s Office, investigated the case. PACER case reference. 23-123.
Appearing on April 11 was:
Camille Ann Rounds, 45, Deborah Lynn Renenger, 32, and Keegan Tait Roll, 28, all transients, on fentanyl trafficking charges. Rounds and Renenger are charged with conspiracy to possess with intent to distribute fentanyl, conspiracy to possess with intent to distribute methamphetamine, possession with intent to distribute fentanyl, possession with intent to distribute meth and possession of a firearm in furtherance of a drug trafficking crime. Roll is charged with conspiracy to possess with intent to distribute fentanyl and possession with intent to distribute fentanyl. If convicted of the most serious crime, Rounds and Renenger face a mandatory minimum of five years to 40 years in prison, a $5 million fine and at least four years of supervised release on the meth trafficking crime, and a mandatory minimum of five years to life in prison, consecutive to any other sentence, a $250,000 fine and five years of supervised release, on the firearm crime. Roll faces a maximum of 20 years in prison, a $1 million fine and at least three years of supervised release. All defendants were detained pending further proceedings. The Billings Police Department, Homeland Security Investigations, Yellowstone County Sheriff’s Office, Montana Highway Patrol and Drug Enforcement Administration investigated the case. PACER case reference. 23-40.
Cynthia Rae Pruett, 51, of Acton, on charges of conspiracy to possess with intent to distribute controlled substances, possession with intent to distribute controlled substances and possession of a firearm in furtherance of a drug trafficking crime. If convicted of the most serious crime, Pruett faces a mandatory minimum of 10 years to life in prison, a $10 million fine and at least five years of supervised release. Pruett was detained pending further proceedings. The Drug Enforcement Administration, Billings Police Department, U.S. Border Patrol, Laurel Police Department, Yellowstone County Sheriff’s Office and Montana Highway Patrol investigated the case. PACER case reference. 23-39.
Appearing on April 10 was:
Paul Nomee III, 60, of Lodge Grass, on charges of prohibited person in possession of a firearm and ammunition. If convicted of the most serious crime, Nomee faces a maximum of 15 years in prison, a $250,000 fine and three years of supervised release. Nomee was detained pending further proceedings. The Bureau of Alcohol, Tobacco, Firearms and Explosives and Bureau of Indian Affairs investigated the case. PACER case reference. 23-29.
Appearing in Great Falls before U.S. Magistrate Judge John T. Johnston and pleading not guilty on April 11 was:
Nikki Marie Snell, 38, of Wolf Point, on charges of possession with intent to distribute meth, possession of a firearm in furtherance of a drug trafficking crime and prohibited person in possession of a firearm. If convicted of the most serious crime, Snell faces a maximum of 15 years in prison, a $250,000 fine and three years of supervised release on the crime of prohibited person in possession of a firearm and a mandatory minimum five years to life in prison, consecutive to any other crime, a $250,000 fine and five years of supervised release on the crime of possessing a firearm in a drug trafficking crime. Snell was detained pending further proceedings. The Bureau of Alcohol, Tobacco, Firearms and Explosives, Homeland Security Investigations and Great Falls Police Department investigated the case. PACER case reference. 23-31.
Shacotta Keenan St. Onge, aka Shaq, 30, of Great Falls, on charges of possession with intent to distribute controlled substances and distribution of controlled substances. If convicted of the most serious crime, St. Onge faces a mandatory minimum of 10 years to life in prison, a $10 million fine and at least five years of supervised release. St. Onge was detained pending further proceedings. Homeland Security Investigations, the Great Falls Police Department and Drug Enforcement Administration investigated the case. PACER case reference. 23-33.
The progress of cases may be monitored through the U.S. District Court Calendar and the PACER system. To establish a PACER account, which provides electronic access to review documents filed in a case, please visit http://www.pacer.gov/register.html. To access the District Court’s calendar, please visit https://ecf.mtd.uscourts.gov/cgi-bin/PublicCalendar.pl.
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Illinois Man Sentenced to over 13 years in Prison for Distributing Heroin and Fentanyl Near a College and ParkRead the Press Release
A man who distributed heroin and fentanyl in Dubuque, Iowa, was sentenced April 13, 2023, to more than 13 years in prison in federal court in Cedar Rapids.
Menelaeus C. Watson, age 35, from Chicago, Illinois, was convicted of distribution of heroin and fentanyl within 1,000 feet of a protected location.
In a plea agreement, Watson admitted to engaging in two transactions to distribute heroin and fentanyl in Dubuque. The transactions took place within 1,000 feet of a local college and two parks. Watson was previously convicted for unlawfully delivering illegal controlled substances on two separate occasions in Illinois.
Sentencing was held before United States District Court Judge C.J. Williams.
Watson was sentenced to serve 164 months’ imprisonment and must serve a 6-year term of supervised release following his term of incarceration. There is no parole in the federal system. Watson remains in the custody of the United States Marshal until he can be transported to federal prison.
This case was investigated by the Dubuque Drug Task Force and was 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 21-CR-1033-CJW.
Follow us on Twitter @USAO_NDIA.
Hazelwood Man Sentenced to 224 Months in Prison for St. Louis Carjacking, Other CrimesRead the Press Release
ST. LOUIS – U.S. District Judge Sarah E. Pitlyk on Friday sentenced a man to 18 years and eight months in prison for a carjacking and other crimes.
Joshua Thomas, 31, admitted being one of two men who stole a 2020 Jeep Cherokee from a woman outside a home in the 4100 block of Camellia Avenue in St. Louis on Oct. 19, 2019. Thomas, who was armed with an AR-15-style firearm, demanded entry to a nearby home and searched it before stealing the car.
Two days later, St. Louis Metropolitan Police Department detectives spotted Thomas and tried to stop him at a market located at the intersection of South Spring Avenue and Delor Street. Thomas sped off in a Kia Optima. Police used a spike strip to deflate the tires, but Thomas kept going, eventually crashing near the intersection of Walsh Avenue and South Grand Boulevard. Thomas discarded a Smith and Wesson 9mm pistol before running away. Police also found drugs, an AR-style pistol loaded with 59 rounds of ammunition and a stolen AK-style pistol loaded with 31 rounds in the car.
Thomas also admitted possessing ammunition on Sept. 30, 2019, the same day a man who was hiding in some bushes in the 3800 block of South Spring Avenue in St. Louis began firing shots at a group of people, hitting one person. Witnesses identified Thomas as the shooter, his plea agreement says.
Thomas pleaded guilty in January to six felonies: carjacking, possession and brandishing a firearm in furtherance of a crime of violence, possession with intent to distribute methamphetamine, possession of a stolen firearm and being a felon in possession of both a firearm and ammunition.
In August, Judge Pitlyk sentenced Thomas’ co-defendant, Jeremiah Couch, 32, to 15 years in prison. Couch pleaded guilty to two carjacking charges, a charge of possession of a stolen firearm and a charge of being a felon in possession of a firearm. He admitted involvement in the Jeep Cherokee carjacking, as well as carjacking a man’s 2007 Ford Edge and his money at gunpoint on October 21, 2019 in the 4700 block of South Spring Avenue in St. Louis. Couch also admitted stealing the AK-47-style pistol from the shooting victim on Oct. 17, 2019.
The case was investigated by the Saint Louis Metropolitan Police Department and the FBI. Assistant U.S. Attorney Jennifer Szczucinksi prosecuted the case.
Haverhill Pill Distributor Indicted for Trafficking Tens of Thousands of Pills Containing Fentanyl and MethamphetamineRead the Press Release
BOSTON – A Haverhill man has been indicted by a federal grand jury in Boston for allegedly distributing tens of thousands of pills containing fentanyl and methamphetamine.
Angel Joel Diaz, a/k/a “Guero,” 34, was indicted on one count of distribution of and possession with intent to distribute fentanyl, two counts of distribution of and possession with intent to distribute 400 grams or more of fentanyl, and one count of possession with intent to distribute 400 grams or more of fentanyl, 50 grams or more of methamphetamine, and methadone. Diaz was previously arrested and charged by criminal complaint on Feb. 15, 2023.
According to the charging documents, in January 2023, an investigation began into Diaz’s fentanyl pill manufacturing and distribution operation. On Jan. 10, 2023, an undercover officer contacted Diaz posing as a potential drug customer seeking to purchase counterfeit prescription pills containing fentanyl. It is alleged that after Diaz agreed to meet the following day, on Jan. 11, 2023, he then provided the undercover officer with 208 fentanyl pills weighing approximately 26 grams. Half of the pills allegedly contained methamphetamine in addition to fentanyl. During the meeting, it is alleged that Diaz told the officer that he manufactures his own fentanyl pills, which he distributes in Lawrence and Boston as well as in New York via mail shipments. Following the meeting, Diaz allegedly maintained communication with the undercover officer regarding additional fentanyl pill purchases. During the communications, it is alleged that Diaz sent several photos depicting his manufacturing process including images of a blue substance in tin pans, wrapped bricks of suspected fentanyl and blue pills with “M-30” stamps commonly used to manufacture counterfeit pills.
It is further alleged that on two subsequent occasions, Jan. 27, 2023 and Feb. 7, 2023, Diaz distributed thousands of counterfeit prescription pills containing suspected fentanyl to the undercover officer. On Feb. 14, 2023, Diaz allegedly sent a photo of suspected fentanyl pills to the undercover officer saying that, “even making it with a mask makes you want to vomit and everything.”
According to court documents on Feb. 15, 2023, Diaz was arrested while carrying a shopping bag containing tens of thousands of fentanyl pills separated into seven plastic bags. During a subsequent search of Diaz’s Haverhill residence two pill presses; thousands of pills; pill stamps; several masks; loose powder of various colors; and suspected fentanyl powder and chemicals used in manufacturing pills were recovered.
The charge of distribution of and possession with intent to distribute fentanyl and methamphetamine provides for a sentence of up to 20 years in prison, at least three years of supervised release and a fine of up to $1 million. The charges of distribution of and possession with intent to distribute 400 grams or more of fentanyl and 50 grams or more of methamphetamine and methadone provide for a sentence of at least 10 years and up to life in prison, at least five years and up to a lifetime of supervised release and a fine of up to $10 million. 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 and Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration, New England Field Division made the announcement today. Assistant U.S. Attorney Samuel R. Feldman of Rollins’ Narcotics & Money Laundering Unit is prosecuting the case.
The details contained in the charging documents are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Gary Man Sentenced to 2 Consecutive Terms of Life in PrisonRead the Press Release
HAMMOND- Hailey Gist-Holden, age 28, of Gary, Indiana, was sentenced by United States District Court Judge Philp P. Simon after a jury found him guilty of armed bank robbery, and using, carrying, brandishing, and discharging a firearm during that bank robbery. The jury specifically found that, as part of the bank robbery and the discharging of the firearm, Gist-Holden killed/murdered the bank security guard. This prosecution arose out of the June 11, 2021, armed robbery of a First Midwest Bank on Ridge Road in Gary, Indiana.
Gist-Holden received two consecutive life sentences in prison followed by 2 years of supervised release.
According to documents in the case, Gist-Holden and other individuals formulated a plan to rob the Bank on Ridge Road in Gary, Indiana. Before actually entering the Bank, Gist-Holden, at point blank range, shot the Bank’s security guard. Gist-Hilden then proceeded into the Bank to complete the robbery. While another member of the robbery crew entered the Bank building and stole approximately $9,000.00, Gist-Holden remained in the doorway of the building firing bullets that shattered windows. After the robbery, Gist-Holden and a co-defendant fled Indiana. Gist-Holden, was subsequently apprehended in Georgia by local law enforcement following a high-speed car chase.
Previously, co-defendants James Anthony King and Kenyon Hawkins pled guilty to armed bank robbery and murder resulting from the discharge of a firearm during the robbery. Both are awaiting sentencing. Another alleged participant in this bank robbery is set to be tried separately.
“First, I want to express by sincerest condolences to the victims in this case. I fully recognize that Gist-Holden’s prosecution does not diminish the anxiety you face or the sorrow that you are – and will continue—to experience because of this senseless act of violence,” said United States Attorney Clifford D. Johnson. “Second, as this case proves, my office, with the support and assistance of federal, state and local enforcement agencies, will prosecute vigorously persons who commit volent crimes that destroy the peace of Northern District of Indiana residents and businesses.”
“While this senseless act of violence will have a lifelong impact on the victims, I hope that knowing this defendant has been held accountable for his crimes helps their healing process,” said FBI Indianapolis Special Agent in Charge Herbert J. Stapleton. “Violent acts such as this in our communities are intolerable and the FBI and our law enforcement partners will continue our efforts to remove dangerous individuals such as the defendant from our streets.”
“I commend the efforts of the numerous law enforcement agencies who participated in this investigation and the United States Attorney’s Office for their partnership in prosecuting those accountable for this tragedy,” commented Special Agent in Charge Christopher Amon. “ The men and women of ATF stand shoulder to shoulder with our law enforcement and prosecutorial partners to ensure our communities are safe.”
This investigation was led by the Federal Bureau of Investigation Gang Response Investigative Team with the assistance of the Lake County Sheriff’s Department; the Lake County Prosecutor’s Office; the Indiana State Police; the Bureau of Alcohol, Tobacco, Firearms, and Explosives; and the Gary Police Department. Additional investigative assistance was provided by the FBI Offices in Chicago, Miami, and Atlanta along with the Georgia State Police, the Atlanta Police Department, and the Lowndes County (GA) Sheriff’s Department. Additional investigative assistance was provided by the FBI Offices in Chicago, Miami, and Atlanta along with the Georgia State Police, the Atlanta Police Department, and the Lowndes County (GA) Sheriff’s Department. Additionally, the U.S. Attorney’s Offices in the Northern District of Georgia, Middle District of Georgia, and the Middle District of Florida were involved in this cooperative effort. This case was tried by Assistant United States Attorneys Caitlin M. Padula and Michal J. Toth, who are joined by the prosecution team which includes Assistant United States Attorneys David Nozick and Kimberly Schultz.
Four of Chapo’s Sons Indicted for Large-Scale Drug Trafficking, Money Laundering and Violent Crimes as Alleged Leaders of Sinaloa CartelRead the Press Release
NEWS RELEASE SUMMARY – April 14, 2023
SAN DIEGO – Four sons of Joaquín Guzmán Loera, the imprisoned former Sinaloa Cartel leader known as El Chapo, were indicted by a federal grand jury for large-scale drug trafficking, money laundering and violent crimes in connection with their assumption of cartel leadership following their father’s arrest and extradition to the United States.
The defendants, known collectively as the “Chapitos,” are Ivan Guzman Salazar, Alfredo Guzman Salazar, Joaquin Guzman Lopez, and Ovidio Guzman Lopez. Three brothers remain at large; Ovidio Guzman Lopez was arrested Jan. 5, 2023, by Mexican authorities in Culiacan, Sinaloa, Mexico. He remains detained in Mexico pending extradition proceedings.
The charges, unsealed today, were announced by Attorney General Merrick Garland, U.S. Attorney Randy Grossman and others at a news conference this morning at the U.S. Department of Justice in Washington, D.C. The charges stem from a decades-long, multi-district investigation by the Southern District of California, the Department of Justice Criminal Division’s Narcotic and Dangerous Drug Section, the Northern District of Illinois, and their law enforcement partners. A related indictment charging three of the brothers was also unsealed by the Southern District of New York.
To view press conference, please see https://www.justice.gov/live. For related Department of Justice press release, indictments and link to DEA fugitive photos, please see https://www.justice.gov/opa/pr/justice-department-announces-charges-against-sinaloa-cartel-s-global-operation.
According to the indictment, filed in the Northern District of Illinois, the defendants are charged under the “Continuing Criminal Enterprise Statute,” which targets large-scale drug traffickers who are responsible for long-term and complex drug conspiracies. They are also charged with additional drug trafficking, money laundering, firearms and violent crimes.
The indictment offers the most comprehensive look yet at the operations of the Sinaloa Cartel dating back 15 years. The indictment describes the cartel’s alleged drug transportation and distribution networks; its financial infrastructure that has laundered hundreds of millions of dollars in illicit proceeds; and the extensive use of violence to maintain power, including an internal power struggle
The Chapitos are alleged to have repeatedly and consistently obtained and transported multi-ton quantities of cocaine from and through Central and South America, including Colombia, Ecuador, Venezuela, Peru, Panama, Costa Rica, Honduras, and Guatemala, into Mexico, stored that cocaine throughout Mexico, and transported it across the U.S.-Mexico border for further distribution throughout the United States. The Chapitos and members of the Sinaloa Cartel also allegedly obtained, manufactured, and transported other drugs, including marijuana, heroin, and methamphetamine, knowing and intending that such drugs would be imported into and distributed throughout the United States. The Chapitos also allegedly obtained precursor chemicals for the manufacture of synthetic drugs and operated laboratories to manufacture methamphetamine.
The indictment said the defendants and other members and associates of the Sinaloa Cartel used, and caused to be used, various means to evade and escape law enforcement and military personnel and to protect their drug distribution activities, including on October 17, 2019, at what is known as the “Battle of Culiacán,” when the Mexican National Guard captured and then released Ovidio Guzmán López during a gunfight in Sinaloa state.
The indictment said the defendants obtained guns and other weapons; bribed corrupt public officials; and incited, threatened and engaged in violence, including murder, kidnapping, assault, and battery against law enforcement, rival drug traffickers, and members of their own drug trafficking organization.
The Chapitos allegedly used cargo aircraft, private aircraft, submarines and other submersible and semi-submersible vessels, container ships, supply vessels, go-fast boats, fishing vessels, buses, rail cars, tractor trailers, automobiles, and private and commercial interstate and foreign carriers to transport their drugs and precursor chemicals. They allegedly maintained a network of couriers, tunnels, and stash houses throughout Mexico and the United States to further their drug-trafficking activities. The Chapitos allegedly used these networks to import the drugs into the United States.
“Today, the Justice Department is announcing significant enforcement actions against the largest, most violent, and most prolific fentanyl trafficking operation in the world – run by the Sinaloa Cartel, and fueled by Chinese precursor chemical and pharmaceutical companies,” said Attorney General Merrick B. Garland. “Families and communities across our country are being devastated by the fentanyl epidemic. Today’s actions demonstrate the comprehensive approach the Justice Department is taking to disrupt fentanyl trafficking and save American lives.”
“Today, we deliver the most crushing blow to the Sinaloa Cartel since the conviction of Chapo Guzman,” said U.S. Attorney Randy Grossman. “We have charged Chapo’s four sons with leading a criminal enterprise built on trafficking tons of deadly drugs into our nation, money laundering, and murder. This case and others we have brought out of the Southern District of California demonstrate our unwavering resolve to dismantle the Sinaloa Cartel by attacking it at every level.” Grossman thanked the prosecution team and dedicated law enforcement partners at the FBI, HSI, DEA and IRS for their extraordinary work on this case.
“These indictments have been a long time in the making and we wouldn’t be here without the collaboration of our local, state, federal, and international partners,” said Special Agent in Charge Stacey Moy of the FBI’s San Diego Field Office. “While there will always be more work to be done, these indictments will continue the dismantlement of an extremely vicious criminal enterprise that has been a primary driver of violence in our communities. We will continue to leverage our law enforcement partnerships to keep pressure on transnational criminal organizations like Los Chapitos.”
“Dismantling this notorious criminal organization flooding the U.S. with deadly narcotics and brutal criminal activity takes the collaboration of a multitude of law enforcement agencies and we are seeing the results of our collective efforts in today’s indictment,” said Special Agent in Charge Chad A. Plantz, HSI’s San Diego Field Office. “HSI proudly stands with our local, state and federal partners as we disrupt and dismantle criminal organizations such as the Sinaloa Cartel to end the violence they fuel across the country.
“The indictment alleges that for years, Joaquín Guzmán Loera’s (El Chapo) sons have destroyed lives and communities through drug trafficking and violence: their time is up,” said DEA Special Agent in Charge Shelly Howe. “These indictments were made possible by our cooperation with local, state, and federal partners. These partnerships demonstrate our collective commitment to tracking down, apprehending, and dismantling one of the strongest drug trafficking cartels from the top down.”
“The indictment alleges that the Chapitos moved drugs and money on a grand scale, and secured and maintained power with intimidation and violence,” said IRS-CI Chief Jim Lee. “Today, we say, no more. For the special agents of IRS Criminal Investigation, the work of investigating dangerous criminals never stops. This indictment shows our commitment to aggressively go after those committing financial crimes who are profiting from their illegal activities no matter who they are or where they commit the crime.”
Once led by the Chapitos’ father, Joaquin Guzman Loera, aka El Chapo, and Ismael Zambada Garcia, aka El Mayo, the Sinaloa Cartel’s members and associates – allegedly including the Chapitos – smuggled significant quantities of drugs through Mexico and into the United States.
Following Guzman Loera’s arrest in January 2016 and extradition to the United States in January 2017, the Chapitos allegedly assumed their father’s former role as leaders of the Sinaloa Cartel, along with Zambada Garcia and Damaso Lopez Nunez, aka Licenciado. The Chapitos subsequently amassed greater control over the Sinaloa Cartel by allegedly threatening and causing violence against Damaso Lopez Nunez, his family, and his associates and, as a result, became principal leaders and drug traffickers within the Sinaloa Cartel.
The U.S. Department of State, through its Narcotics Rewards Program, is offering rewards of up to $10 million for information leading to the arrest and/or conviction of Ivan Guzman Salazar, Alfredo Guzman Salazar, and Ovidio Guzman Lopez and up to $5 million for information leading to the arrest and/or conviction of Joaquin Guzman Lopez.
Assistant U.S. Attorney Matthew J. Sutton for the Southern District of California and Acting Deputy Chief Katharine Wagner and Trial Attorney Kirk Handrich of the Criminal Division’s Narcotic and Dangerous Drug Section, and Assistant U.S. Attorneys Andrew Erskine and Erika Csicsila for the Northern District of Illinois, are prosecuting the case.
U.S. Attorney Grossman thanked federal, state and local law enforcement for the coordinated team effort in the culmination of this investigation. The FBI San Diego Field Office and Washington Field Office, Homeland Security Investigations San Diego and Nogales Office, DEA’s San Diego Division and Chicago Division, and IRS Criminal Investigation are investigating the case.
This prosecution is also part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
DEFENDANTS Case Number 09-CR-383 (ND-IL)
*Ivan Guzman Salazar Age: 40 Sinaloa, MX
*Alfredo Guzman Salazar Age: 37 Sinaloa, MX
*Joaquin Guzman Lopez Age: 36 Sinaloa, MX
Ovidio Guzman Lopez Age: 33 Sinaloa, MX
*Fugitives
An indictment and or complaint is not evidence of guilt. The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
SUMMARY OF CHARGES
Conspiracy to Distribute Controlled Substances in violation of Title 21 U.S.C. §§ 841 and 846
Term of custody including a mandatory minimum 10 years and up to life imprisonment, $10 million fine.
Continuing Criminal Enterprise, in violation of Title 21 U.S.C. §§ 848(a) and (b)
Term of custody including a mandatory minimum 20 years and up to life imprisonment, $2 million fine.
The defendants are charged as the principal administrators, organizers or leaders of the enterprise or is one of several such principal administrators, organizers, or leaders; and the violation involved 300 times the quantity of a substance described in subsection 841(b)(1)(B) (100 grams of heroin, 500 grams of cocaine, 100 kilograms of marijuana or 50 grams of Methamphetamine mixture), which is mandatory life imprisonment.
Conspiracy to Import Controlled Substances, in violation of Title 21 U.S.C. §§ 952, 960 and 963. Term of custody including a mandatory minimum 10 years and up to life imprisonment, $10 million fine.
Conspiracy to Distribute Controlled Substances for Purpose of Unlawful Importation, in violation of Title 21 U.S.C. §§ 959, 960 and 963; Term of custody including a mandatory minimum 10 years and up to life imprisonment, $10 million fine.
Distribution of a Controlled Substance, in violation of Title 21 U.S.C. § 841(a)(1); Term of custody including a mandatory minimum 10 years and up to life imprisonment, $10 million fine.
Conspiracy to Commit Money Laundering, in violation of Title 18 U.S.C. §§ 1956 (a)(2)(A) and (h); Term of custody up to 20 years imprisonment, a fine of the greater of $500,000 or twice the value of the monetary instrument or funds involved.
Use and Possession of a Firearm During a Drug Trafficking Crime, in violation of 924(c)(1)(A), (c)(1)(B). Term of custody up to life imprisonment, and a mandatory consecutive sentence of 30 years imprisonment.
AGENCIES
Federal Bureau of Investigation
Homeland Security Investigations
Drug Enforcement Administration
Internal Revenue Service Criminal Investigation
United States Marshals Service
Customs and Border Protection Office of Field Operations
Customs and Border Protection Office of Border Patrol
Department of Justice, Organized Crime Drug Enforcement Task Forces
Department of Justice, Narcotics and Dangerous Drug Section
Department of Justice, Office of International Affairs
Department of Justice, Office of Enforcement Operations, Electronic Surveillance Unit
U.S. Attorney’s Office for the Northern District of Illinois
Department of Treasury, Office of Foreign Asset Control
San Diego County District Attorney’s Office
San Diego Law Enforcement Coordination Center
Interpol
Four Men Charged with Possessing Machineguns in Furtherance of Drug TraffickingRead the Press Release
Indictment Alleges the Assembly and Use of Fully Automatic “Ghost Guns”
WASHINGTON – Four men were arraigned this morning on federal charges, including conspiracy to distribution of marijuana and oxycodone, unlawful transfer and possession of a machinegun, and using, carrying, and possessing machineguns during, in relation to, or in furtherance of drug trafficking. The charges were announced by U.S. Attorney Matthew M. Graves, Special Agent in Charge Wayne A. Jacobs, of the FBI Washington Field Office Criminal and Cyber Division, Acting Special Agent in Charge Michael T. Weddel of the ATF Washington Field Division, and Chief Robert J. Contee, III, of the Metropolitan Police Department (“MPD”).
The indictment alleges that Eugene Tracy Hill, also known as “Geno” or “Cheese,” Diante Arik Wiley, also known as “Sleez” or “Taybino,” Broadus Jamal Daniels, also known as “Wardy,” and Andre Alonte Willis, also known as “Boogie,” were engaged in a years-long conspiracy to distribute marijuana and oxycodone. It is further alleged that Hill and Willis distributed, possessed with the intent to distribute, or conspired to distribute more than 100 kilograms of marijuana.
The indictment further alleges that, in furtherance of their drug trafficking conspiracy, and in order to protect the co-conspirators and their drugs, money, and drug-dealing territory, Wiley assembled AR-Pistol machineguns from parts that he bought through online retailers and sold those machineguns to Hill, Daniels, Willis, and others. Since the AR-Pistols that Wiley built were assembled from parts, they had no serial numbers and there was no way for law enforcement to track their possession or sale. Such firearms are defined as “Privately Made Firearm” by ATF but are also referred to as “ghost guns” on the street.
The indictment alleges that Hill, Wiley, Daniels, and Willis used the machineguns for defense of their territory, and also as currency to trade for drugs or other firearms. All four men have been detained since their arrest, and law enforcement seized controlled substances and firearms from each of their residences after they were taken into custody.
If convicted of all charges, each defendant faces a minimum of 30 years in prison.
This indictment is part of a joint investigation which has resulted in the seizure of two vehicles, 13 handguns, five machineguns, and hundreds of rounds of ammunition, as well as almost 40 pounds of marijuana, dozens of oxycodone pills, and more than $300,000 in cash.
In announcing the charges, U.S. Attorney Graves, Special Agent in Charge Jacobs, Acting Special Agent in Charge Weddel, and Chief Contee commended the work of those who investigated the case, including FBI, ATF, and MPD. Finally, they cited the efforts of those who worked on the case from the U.S. Attorney’s Office for the District of Columbia, including Assistant U.S. Attorney James B. Nelson and Paralegal Specialist Genevieve de Guzman.
The charges in an indictment are merely allegations, and every defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
Four Arrested after DEA-led Investigation into Waterbury Drug Trafficking RingRead the Press Release
United States Attorney Vanessa Roberts Avery, Special Agent in Charge Brian D. Boyle of the Drug Enforcement Administration for New England, and Waterbury Police Chief Fernando C. Spagnolo today announced that the following four individuals were arrested yesterday on federal criminal complaints charging each with conspiracy to distribute controlled substances, including fentanyl, heroin, cocaine, and cocaine base (“crack”):
GAWAYNE FISHER, a.k.a. “Fruit” and “Tank,” 47, of Waterbury
TERRY COLLINS, 29, of Bristol
DAVID HING, a.k.a. “LA,” 57, of Waterbury
DERRICK PRUDEN, a.k.a. “DP,” 53, of WaterburyAs alleged in court documents and statements made in court, for approximately nine months, the DEA New Haven Task Force, the DEA Tactical Diversion Squad, the Waterbury Police Department, and other law enforcement agencies have been conducting an investigation into drug trafficking in and around the city of Waterbury by Fisher and his associates. The investigation, which has included court-authorized wiretaps on multiple phones, physical surveillance, and controlled purchases of narcotics, revealed that Fisher received heroin/fentanyl from Collins, and fentanyl/heroin and cocaine from other suppliers. He then distributed the narcotics to other drug sellers, including Hing and Pruden.
It is also alleged that Fisher used an apartment at 1015 West Main Street in Waterbury to store narcotics, and that Collins used a residence at 109 Yale Street in Waterbury as a “heroin mill,” where he and others stored narcotics and processed and packaged narcotics for distribution.
On April 13, 2023, in association with the arrests of the four defendants, agents and officers from the DEA, FBI, Connecticut State Police, and Waterbury, Naugatuck, Bristol and East Haven police departments, executed multiple federal and state search warrants that resulted in the seizure of drugs and cash proceeds (photos attached). A search of the apartment at 1015 West Main Street revealed an estimated 16 kilograms of cocaine, three kilograms of fentanyl, and an estimated 125,000 individual glassine bags containing a substance that field tested positive as fentanyl. A search of 109 Yale Street in Waterbury revealed drug-processing equipment, an estimated three kilograms of loose fentanyl, and an estimated 75,000 individual glassine bags containing a substance that field tested positive as fentanyl. In addition, a search of Fisher’s residence on Beverly Avenue in Waterbury revealed approximately $150,000 in cash.
“As fentanyl addiction continues to cause so much misery in our state and around the country, we are determined to interrupt the flow of this deadly drug, seize drug proceeds, and prosecute those involved to the full extent of the law,” said U.S. Attorney Avery. “It is alleged that these defendants flooded the Waterbury area with fentanyl and other drugs, and yesterday’s seizures represent one of the largest we have seen in Connecticut to date. I thank the DEA, Waterbury Police and our many partner law enforcement agencies involved in this investigation for their tireless efforts in taking these drugs off the street. Their work is saving lives.”
“Illegal drug distribution ravages the very foundations of our families and communities here in Connecticut,” said DEA Special Agent in Charge Brian D. Boyle. “Let these arrests and seizures serve as an example and be a warning to those who distribute poisons like fentanyl, heroin and cocaine, that DEA will aggressively and actively pursue and hold you accountable. This investigation demonstrates the strength and continued commitment of our local, state and federal law enforcement partners here in Connecticut and our solid relationship with the U.S. Attorney’s Office.”
“Our partnership with the DEA and the U.S. Attorney’s Office continues to thwart drug trafficking in Waterbury,” said Chief Spagnolo. “We look forward to continuing this important work with our federal partners to remove these drugs, and those involved in distributing it, from our community.”
Following their arrests, Fisher, Collins, Hing and Pruden appeared before U.S. Magistrate Judge Maria E. Garcia in New Haven. Fisher, Hing, and Pruden were ordered detained, and Collins was released on a $100,000 bond.
U.S. Attorney Avery stressed that a complaint is only a charge and is not evidence of guilt. Charges are only allegations, and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This investigation is being conducted by the DEA New Haven Task Force, the DEA Tactical Diversion Squad, and the Waterbury Police Department, with the assistance of the Federal Bureau of Investigation, U.S. Marshals Service, Connecticut State Police, Internal Revenue Service – Criminal Investigation Division, and the New Haven, Naugatuck, Ansonia, West Haven, Meriden, East Haven, Branford, Shelton, and Bristol Police Departments.
The DEA New Haven Task Force includes participants from the DEA, U.S. Marshals Service, Internal Revenue Service – Criminal Investigation Division, Connecticut State Police and the New Haven, Waterbury, East Haven, Branford, West Haven, Ansonia, Meriden, Naugatuck, and Shelton Police Departments. The DEA Tactical Diversion Squad is composed of personnel from the DEA and the Manchester, Glastonbury, West Haven, Hamden, Newington, and Bristol Police Departments.
This case is being prosecuted by Assistant U.S. Attorneys Patrick Caruso, Natasha Freismuth, and Daniel Cummings through the Organized Crime Drug Enforcement Task Forces (OCDETF) Program. OCDETF identifies, disrupts and dismantles drug traffickers, money launderers, gangs and transnational criminal organizations through a prosecutor-led and intelligence-driven approach that leverages the strengths of federal, state and local law enforcement agencies. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
Fort Dodge Woman Sentenced to Federal Prison for Nearly 10 Years for Meth Conspiracy ConvictionRead the Press Release
A woman who conspired to distribute methamphetamine was sentenced on April 5, 2023, in federal court in Sioux City, to 117 months’ imprisonment.
Amber Miller, 35, from Fort Dodge, Iowa, pled guilty on November 2, 2022, to conspiracy to distribute methamphetamine.
At the plea and sentencing hearings, evidence showed Miller’s involvement in a conspiracy scheme that distributed more than 15 kilograms of methamphetamine from January 2020 through April 2022. On two separate occasions in January and March 2021, Miller distributed a total of 140 grams of methamphetamine to an individual cooperating with law enforcement, during controlled purchase operations. Miller also admitted conduct obstructing justice.
Sentencing was held before United States District Court Chief Judge Leonard T. Strand. Miller was sentenced to 117 months’ imprisonment and must serve a four-year term of supervised release following the imprisonment. There is no parole in the federal system. Miller remains in custody of the United States Marshal until she can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Shawn S. Wehde and was investigated by Iowa Division of Narcotics Enforcement, Webster County Sheriff’s Office, and Hamilton County Sheriff’s Office, DCI Laboratory.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 22-3015. Follow us on Twitter @USAO_NDIA.
Fort Dodge Man Headed Back to Federal Prison for Violating Federal Supervised ReleaseRead the Press Release
A man who violated the terms of his federal supervised release was sentenced April 10, 2023, to three years in federal prison.
Jeremiah Preston, 40, from Fort Dodge, Iowa, received the prison term after a Judge found him guilty of violating the terms and conditions of his supervised release. Preston was previously convicted of being a felon in possession of a firearm and distribution of a controlled substance and was sentenced to 84 months’ imprisonment. Preston began his term of supervised release in October 2022.
Evidence at the hearings showed Preston began violating multiple conditions of his supervised release shortly after his release from prison. In January 2023, during a traffic stop, Preston was found with two ounces of methamphetamine which he intended to distribute to others.
Preston was sentenced in Sioux City by United States District Court Chief Judge Leonard T. Strand. Preston was sentenced to 36 months’ imprisonment. He must also serve a two-year term of supervised release after the prison term. There is no parole in the federal system.
Preston is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Shawn S. Wehde and investigated by the U.S. Probation Office, the Iowa Division of Narcotics Enforcement, Webster County Sheriff’s Office, and the Fort Dodge Police Department.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file numbers are 15-3048 and 16-3028. Follow us on Twitter @USAO_NDIA.
Former Postal Employee Pleads Guilty to Stealing Gift Cards and Money from the MailRead the Press Release
ROCHESTER, N.Y.-U.S. Attorney Trini E. Ross announced today that Shalika Williams, 30, of Buffalo, NY, pleaded guilty to officer or employee of the United States converting property of another, less than $1000, before U.S. Magistrate Judge Mark W. Pedersen. The charge carries a maximum penalty of one year in prison, and a $100,000 fine.
Assistant U.S. Attorney Meghan K. McGuire, who is handling the case, stated that between September and November 4, 2022, Williams was employed by the United States Postal Service as a sales, service, and distribution associate at the Buffalo Processing and Distribution Center. During this time, Williams riffled through and opened sealed pieces of mail and stole approximately 10 to 15 gift cards valued at $360 and $300 in cash.
The plea is the result of an investigation by the United States Postal Service Office of Inspector General, under the direction of Special Agent-in-Charge Matthew Modafferi, Northeast Area Field Office.
Sentencing is scheduled for August 21, 2023, at 1:00 p.m. before Judge Pedersen.
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Former North Shore Resident Pleads Guilty to COVID-Relief FraudRead the Press Release
BOSTON – A former North Shore resident pleaded guilty yesterday in federal court to charges that he filed fraudulent applications for more than $660,000 in Paycheck Protection Program (PPP) loan funds and used those funds for personal expenses, including the purchase of an alpaca farm in Vermont.
Dana L. McIntyre, 59, of Grafton, Vt. and previously of Beverly and Essex, Mass., pleaded guilty to four counts of wire fraud and three counts of money laundering. U.S. District Court Judge Denise J. Casper scheduled sentencing for July 12, 2023. McIntyre was arrested and charged by criminal complaint and later indicted by a federal grand jury in May 2021.
McIntyre is the former owner of Rasta Pasta Pizzeria in Beverly. In March 2020, McIntyre used the names of his adult children to submit two fraudulent applications to the U.S. Small Business Administration (SBA) for Economic Injury Disaster Loans (EIDL) for fictitious businesses. Beginning in April 2020, McIntyre submitted an application and weekly certifications in order to receive Pandemic Unemployment Assistance (PUA) benefits. In these filings, McIntyre falsely claimed that he was not working or receiving income as a result of the pandemic, while McIntyre in fact was still operating the restaurant and paying himself income from the business. By September 2020, when McIntyre sold the restaurant, he had received over $17,000 in PUA and related benefits that he was not entitled to receive.
In April 2020, McIntyre submitted a fraudulent application for a PPP loan of over $660,000 through an SBA-approved lender. In the application, McIntyre inflated information about the pizzeria’s employees and payroll expenses and falsified an official tax form in an effort to qualify the business for a larger loan amount. After receiving a PPP loan of over $660,000, McIntyre sold the pizzeria and used nearly all the funds to purchase and improve an alpaca farm in Vermont and on other personal expenses, including two vehicles and air time for his crypto-currency themed radio show.
The charge of wire fraud provides for a sentence of up to 20 years in prison, three years of supervised release and a fine of $250,000, or twice the gross gain or loss from the scheme, whichever is greater. The charge of money laundering provides for a sentence of up to 20 years in prison, three years of supervised release and a fine of $500,000, or twice the value of the criminally derived property. 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 R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division; Joleen D. Simpson, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; and Christina Scaringi, Special Agent in Charge of the U.S. Department of Housing and Urban Development, Office of the Inspector General, Northeast Regional Office made the announcement today. Assistant U.S. Attorneys David M. Holcomb and Mackenzie A. Queenin of Rollins’ Securities, Financial & Cyber Fraud Unit are prosecuting the case.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.Florida Woman Pleads Guilty to Defrauding Holocaust Survivor of $2.8 Million in Connection with Romance ScamRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that PEACHES STERGO pled guilty today before United States District Judge Edgardo Ramos in connection with her years-long scheme to defraud an 87-year-old Holocaust survivor of his life savings.
U.S. Attorney Damian Williams said: “Peaches Stergo stole the life savings from an 87-year-old Holocaust survivor who was just looking for companionship. This conduct is sick – and sad. Using the millions in fraud proceeds, Stergo lived a life of luxury, purchasing a home in a gated community and a Corvette, taking vacations at hotels like the Ritz Carlton, and buying thousands in designer clothing, while at the same time causing her elderly victim to lose his apartment. Thanks to the hard work of the FBI and this Office, Stergo is being held accountable for her fraud.”
As alleged in the Indictment:
From at least in or about May 2017, up to and including at least October 2021, STERGO engaged in a scheme to defraud an 87-year-old Holocaust survivor (the “Victim”) of over $2.8 million, which was his life savings.
STERGO met the Victim on a dating website approximately six or seven years ago. In or about early 2017, STERGO asked the Victim to borrow money to pay her lawyer, who she claimed was refusing to release funds from an injury settlement. After the Victim gave her the money, STERGO said the settlement funds had been deposited into her TD Bank account. In reality, bank records show STERGO never received any money from an injury settlement.
Over the next four and a half years, STERGO continued her lies. She repeatedly demanded that the Victim deposit money into her bank accounts. She claimed that if he did not, her accounts would be frozen and he would never be paid back. In total, the Victim wrote 62 checks — totaling over $2.8 million — that were deposited into one of two of STERGO’s bank accounts.
In furtherance of the fraud, STERGO created a fake email account, intended to appear as if it belonged to a TD Bank employee. She also created fake letters from a TD Bank employee and fake invoices.
While the Victim lost his life savings and was forced to give up his apartment, STERGO lived a life of luxury with the millions she received from the fraud: she bought a home in a gated community, a condominium, a boat, and numerous cars, including a Corvette and a Suburban. During the course of the fraud, STERGO also took expensive trips, staying at places like the Ritz Carlton, and spent many tens of thousands of dollars on expensive meals, gold coins and bars, jewelry, Rolex watches, and designer clothing from stores like Tiffany, Ralph Lauren, Neiman Marcus, Louis Vuitton, and Hermes.
* * *
STERGO, 36, of Champions Gate, Florida, pled guilty to one count of wire fraud, which carries a maximum sentence of 20 years in prison. In connection with the guilty plea, STERGO agreed to pay $2,830,775 in restitution and to forfeit the same amount, along with over 100 luxury items she purchased with fraud proceeds, including Rolex watches, designer purses and clothing, and large amounts of gold and jewelry.
The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge. Sentencing has been scheduled for July 27, 2023, at 11:00 a.m.
Mr. Williams praised the outstanding investigative work of the Federal Bureau of Investigation.
This case is being handled by the Office’s General Crimes Unit. Assistant U.S. Attorney Adam Sowlati is in charge of the prosecution.
Film Producer Sentenced to 10 Years for Bank RobberyRead the Press Release
Orlando, Florida – U.S. District Judge Paul G. Byron has sentenced Nacoe Ray Brown (55, Baltimore, Maryland) to 10 years in federal prison for bank robbery and violating the terms of his supervised release. The penalties included 8 years for the robbery offense and 2 years consecutive for violating the terms of his supervised release related to his previous convictions for bank robbery in the District of Maryland. Brown had pleaded guilty on January 4, 2023.
According to the plea agreement and other court documents, Brown was previously convicted of robbing three banks in the Baltimore area in 2001. After a federal jury convicted him of the robberies, he was sentenced to 25 years in federal prison. In 2020, Brown was released early on compassionate release grounds based upon concerns over the pandemic. Brown then began serving his term of supervised release under the supervision of the U.S. Probation Office in Baltimore.
On June 28, 2022, while visiting Florida, Brown robbed the McCoy Federal Credit Union in Belle Isle. Wearing a baseball cap, sunglasses, a surgical style facemask, and plastic gloves, Brown passed a note to the teller threatening that he had a gun and demanding money. He fled the bank with $4,296 in stolen cash. Surveillance cameras captured Brown as he appeared to the teller during the robbery:
A witness watched Brown flee the bank and enter a nearby gas station where he had staged a change of clothes. The witness reported this to the Belle Isle Police Department, who quickly responded and located Brown at the hotel where he was staying. Police recovered the demand note and the stolen cash from Brown’s bag. They also recovered the disguise he had discarded in the restroom of the gas station.
After he was arrested, Brown told authorities that he committed the bank robbery because he was filming a movie in Florida and had run out of money to pay for the production.
This case was investigated by Federal Bureau of Investigation and the Belle Isle Police Department. It was prosecuted by Assistant United States Attorney Michael P. Felicetta.
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.
Federal Court Permanently Shuts Down Detroit Tax Preparation BusinessRead the Press Release
On March 13, 2022, a federal court in Detroit entered a permanent injunction against Jeanisia Saquise Allen and First Choice Tax Solutions, LLC, The Tax Experts, Inc., The Tax Experts, LLC, and Top Notch Taxes, Inc., prohibiting them from preparing federal tax returns for others and owning, operating, or franchising a tax return preparation business. Following a payment by Allen to the government pursuant to a settlement agreement, the court, with the government’s consent, today dismissed claims against Allen and her businesses seeking the disgorgement of ill-gotten gains that they received for the preparation of tax returns.
In addition, in related cases also filed in the same Detroit federal court, the court previously entered permanent injunctions against Jennifer Sherman and Erica McGowan, and their respective related businesses, Sherman Management Co., LLC and America Enterprise, LLC. The government complaints in those cases alleged that Sherman and McGowan entered into agreements with Allen and her entity, The Tax Experts LLC, to use the name “The Tax Experts” to conduct business preparing tax returns. The complaints in the cases against Sherman and McGown alleged that their companies falsely claimed the Earned Income Tax Credit and education credits, fabricated business income and expenses, and claimed improper filing status for customers.
A third lawsuit against Annetta Powell and Jasmine Powell, who the government also alleges entered into agreements to use the name “The Tax Experts” to conduct a tax preparation business, is ongoing in federal court in Detroit. Annetta Powell agreed to the entry of a preliminary injunction barring her and her businesses from preparing federal tax returns for others until the date on which trial on whether a permanent injunction is warranted occurs.
In the case against Allen, the complaint alleges that The Tax Experts has operated as many as 32 tax preparation stores during a single year, primarily in metro-Detroit, but also in Chicago and Los Angeles. Over the course of three years (2017, 2018, and 2019), businesses operating as “The Tax Experts” allegedly prepared more than 17,000 federal tax returns claiming over $82 million in tax refunds. The complaint alleges that Allen and The Tax Experts failed to train, oversee, and control businesses that operate under an agreement to use that name. The complaint against Allen further alleges the Tax Experts prepare false or fraudulent tax returns exhibiting common and widespread false income, expenses, claims, credits, and deductions. According to the complaint against Allen, the IRS examined 716 federal tax returns prepared by The Tax Experts, resulting in a total additional tax owed to the United States of $3,552,114, or an average of $5,349.57 for each adjusted return.
Deputy Assistant Attorney General David A. Hubbert of the Justice Department’s Tax Division made the announcement.
Shady tax return preparers remain a concern of the IRS, which recently warned taxpayers about unscrupulous tax return preparers as part of the IRS’s Dirty Dozen series. As the 2023 tax season continues, taxpayers seeking a return preparer should remain vigilant against unscrupulous tax preparers. The IRS offers tips on how to accurately file returns and how to choose a tax return preparer, as well as steps taxpayers can take to get a jumpstart on filing. The IRS also offers 10 tips to avoid tax season fraud and ways to safeguard their personal information.
Taxpayers seeking assistance can access the IRS’s free directory of federal tax preparers. The IRS also has programs offering free basic return preparation for qualifying seniors and individuals with low to moderate income). In addition, IRS Free File, a public-private partnership, offers free online tax preparation and filing options on IRS partner websites for individuals whose adjusted gross income is under $73,000. For individuals whose income is over that threshold, IRS Free File offers electronical federal tax forms that can be filled out and filed online for free.
In the past decade, the Department of Justice Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.