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23 February 2023
Ozy Media and Its Founder Carlos Watson Indicted in a Years-Long Multi-Million Dollar Fraud SchemeRead the Press Release
Updated Press Release
An indictment was unsealed this morning in federal court in Brooklyn charging OZY Media Inc. (Ozy), a media and entertainment company headquartered in Mountain View, California, and its founder and Chief Executive Officer, Carlos Watson, with conspiracy to commit securities fraud and conspiracy to commit wire fraud in connection with a scheme to defraud Ozy’s investors and lenders by making material misrepresentations about Ozy’s financial and business assets. Watson is also charged with aggravated identity theft for his role in the impersonation of multiple media company executives in communications with Ozy’s lenders and prospective investors in furtherance of the fraud schemes.
Watson was arrested this morning and will be arraigned later today before United States Magistrate Judge Cheryl L. Pollak. If convicted, Watson faces a mandatory minimum sentence of two years’ imprisonment and a maximum sentence of 37 years’ imprisonment.
Watson’s co-conspirators Samir Rao, Ozy’s Chief Operating Officer, and Suzee Han, Ozy’s Chief of Staff from June 2019 to October 2021, previously pleaded guilty to charges relating to their roles in the scheme. The U.S. Securities and Exchange Commission (SEC) is taking concurrent enforcement action.
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 arrest and indictment.
“As the indictment today alleges, Watson repeatedly attempted to entice both investors and lenders through a series of deliberate deceptions and fabrications. The FBI and our partners in law enforcement will hold any individual willing to defraud investors and financial institutions accountable in the criminal justice system,” stated Assistant Director-in-Charge Driscoll.
The Scheme
As alleged in the indictment and court documents, Ozy is a media and entertainment company whose businesses include digital newsletters, television production, podcasts, and live events, the most prominent of which is a live festival known as “Ozy Fest.” Watson founded Ozy in 2012 and has served as the company’s Chief Executive Officer since its inception.
Between approximately 2018 and 2021, Watson and his co-conspirators, including Rao and Han, orchestrated a scheme to defraud investors in and lenders to Ozy of tens of millions of dollars through fraudulent misrepresentations and omissions about key aspects of Ozy’s business, including Ozy’s financial results, debts, and audience size. In addition, Watson and his co-conspirators lied to prospective investors about who else might be investing in Ozy, the existence and size of acquisition offers received by Ozy, the existence and timing of “Series C” and “Series D” financing rounds by Ozy, and the existence and terms of Ozy’s business contracts — going so far as to direct Ozy employees to create fake contracts with forged signatures to provide in due diligence. On multiple occasions, when faced with questions from lenders or potential investors, Watson and his co-conspirators assumed the identities of and impersonated actual media company executives to cover up their prior fraudulent misrepresentations.
Forged Cable Television Contract and Impersonation of Media Executive
In December 2019, Watson and his co-conspirators attempted to induce a bank to lend Ozy money based on misrepresentations and omissions about Ozy’s business. Watson and his co-conspirators sought to secure the loan with anticipated revenues from a second season of an Ozy television show. However, the contract between Ozy and the show’s cable network for the second season of the show was still under negotiation. To induce the bank to make the loan sooner, Watson directed Ozy’s then-Chief Financial Officer (CFO) to send the bank a fake signed contract between Ozy and the cable network purporting to be for the second season. When the then-CFO refused, Rao, with Watson’s approval, sent the fake contract — which contained terms favorable to Ozy and a forged signature — to the bank, copying the then-CFO. Later that day, the then-CFO emailed Watson and Rao to say that she was resigning effective immediately. She explained, “this . . . is illegal. This is fraud. This is forging someone’s signature with the intent of getting an advance from a publicly traded bank.” She continued, “To be crystal clear, what you see as a measured risk — I see as a felony.”
In subsequent months, Watson and his co-conspirators continued to attempt to induce the bank to lend Ozy several million dollars based on misrepresentations and omissions, including regarding the expected revenue from the second season of the Ozy television show. During these discussions, the bank requested to speak to a representative of the cable network. To conceal the lies about Ozy’s relationship with the cable network and the status and terms of their agreement, Rao, with Watson’s approval, created a fake email address in the name of an actual executive of the cable network, which Rao used to impersonate the executive and communicate with the bank about the potential loan.
Attempted Fraudulent Investment and Impersonation of Another Media Executive
From approximately November 2020 through February 2021, Watson and his co-conspirators attempted to induce a financial institution to invest up to $45 million in Ozy by means of material misrepresentations and omissions regarding Ozy’s historical and projected financial results, debts, and business relationships. Had the full $45 million investment occurred as intended, $6 million of the $45 million would have been paid to Watson personally.
As part of its due diligence process, the financial institution asked Watson and Rao to arrange a meeting with someone from a well-known online video service that Watson and his co-conspirators claimed had paid Ozy nearly $6 million in licensing revenue for “The Carlos Watson Show.” This was another misrepresentation — Ozy was never paid by this online video service for Ozy content. Because Ozy did not in fact have any business relationship with the online video service, Watson and Rao agreed that Rao would impersonate a media executive at the online video service in communications with the financial institution. On or about January 28, 2021, Rao, with Watson’s agreement, created a fake email address in the name of the media executive, which he used to correspond with representatives of the financial institution.
On or about February 2, 2021, Rao had a call with employees of the financial institution during which he impersonated a media executive from the online video service using a voice alteration application that he downloaded onto his cellular telephone to mask his voice during the call. During the call, Watson was in the same room as Rao, and texted Rao instructions about what to say and what not to say on the call. Shortly after the call, one of the employees of the financial institution contacted the actual media executive of the online video service, who confirmed that he had not been on the call and that the online video service had no role in the production of The Carlos Watson Show. When members of the financial institution later spoke with Watson, he falsely claimed that Rao had acted alone and as a result of a mental breakdown.
The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.
The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys Jonathan Siegel, Dylan A. Stern, and Gillian Kassner are in charge of the prosecution, with assistance from Paralegal Specialist Jake Menz.
The Defendants:
CARLOS WATSON
Age: 53
Mountain View, CaliforniaOZY MEDIA, INC.
Mountain View, CaliforniaE.D.N.Y. Docket No. 23-CR-82 (EK)
Omaha Man Sentenced to 180 Months for Firearms and Methamphetamine ChargesRead the Press Release
United States Attorney Steven A. Russell announced that Raymond McGaugh, 31, of Omaha, Nebraska, was sentenced in federal court in Omaha on February 22, 2023, for Possession with Intent to Distribute Methamphetamine and Possession of Firearms in Furtherance of Drug Trafficking. United States District Brian C. Buescher sentenced McGaugh to 180 months’ imprisonment. There is no parole in the federal system. He was also ordered to serve five years of supervised release after his release from prison.
On June 27, 2021, law enforcement initiated a traffic stop on a black Dodge Charger for failing to have license plates. McGaugh was the driver and sole occupant of the vehicle. Officers smelled marijuana emanating from the vehicle and searched the vehicle. Officers located a backpack on the passenger seat that contained 365 grams of actual methamphetamine along with two loaded handguns. One of the firearms was reported stolen.
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 Omaha Police Department.
Newtown Contractor Pleads Guilty to Tax EvasionRead the Press Release
Vanessa Roberts Avery, United States Attorney for the District of Connecticut, and Joleen D. Simpson, Special Agent in Charge of IRS Criminal Investigation in New England, today announced that THOMAS R. SAINT, 67, of Newtown, waived his right to be indicted and pleaded guilty yesterday in Bridgeport federal court to one count of tax evasion.
According to court documents and statements made in court, Saint is the sole owner of Tom Saint Painting and Remodeling LLC, a Schedule C business engaged in painting and home renovation services. From 2013 through 2019, Saint attempted to evade the assessment of federal taxes by cashing business checks instead of depositing them into his business’s bank account, depositing cash and business checks into his personal bank account, and failing to inform his tax preparer of this conduct, which resulted in the filing of false returns with the IRS that substantially understated his gross receipts and income.
For the 2013 through 2019 tax years, Saint failed to report a total of $2,163,645 in gross receipts, resulting in a tax loss to the government of $791,500. Saint has agreed to cooperate with the IRS to pay all outstanding taxes, interest and penalties.
Tax evasion carries a maximum term of imprisonment of five years. Saint in scheduled to be sentenced by U.S. District Judge Michael P. Shea on May 22 in Hartford.
Saint is released on a $100,000 bond pending sentencing.
This investigation has been conducted by the Internal Revenue Service, Criminal Investigation Division. The case is being prosecuted by Assistant U.S. Attorney Susan Wines.
New Orleans Man Sentenced for Theft and Sale of Motor Vehicle from Mississippi Car DealershipRead the Press Release
NEW ORLEANS – U.S. Attorney Duane A. Evans announced that JONATHAN BUSH (“BUSH”), age 35, was sentenced on February 16, 2023, for conspiring to transport and sell stolen vehicles in violation of Title 18, United States Code, Section 371.
According to court documents, BUSH and his co-conspirators stole cars from car dealerships and rental car facilities in Louisiana, Mississippi, Alabama, and George. After the cars were stolen, BUSH and his co-conspirators would retitle the cars under fraudulent Vehicle Identification Numbers (VINS) with the Louisiana Office of Motor Vehicles. After the cars were retitled and cloned with fraudulent VINS, the defendants would then resell the cars to buyers in the New Orleans metro area at discounted prices.
U.S. District Court Judge Nanette Jolivette Brown sentenced BUSH to serve (60) months in prison, to be followed by three (3) years of supervised release and imposed a $100 mandatory special assessment fee. The Court also set a restitution hearing in this matter for April 20, 2023.
U.S. Attorney Evans praised the work of the Department of Homeland Security, the Louisiana State Police, the D’Iberville Police Department, and the New Orleans Police Department in investigating this matter. Assistant U.S. Attorneys Spiro G. Latsis and Jon Maestri of the General Crimes Unit are in charge of the prosecution.
New Jersey Doctor Admits Buying and Selling Oncology Medication for ProfitRead the Press Release
NEWARK, N.J. – A New Jersey doctor today admitted using his medical license – and allowing other to use his medical license – to purchase prescription oncology medications under false pretenses for the purpose of selling them for profit, U.S. Attorney Philip R. Sellinger announced.
Joel Lerner, 62, of Warren, New Jersey, a board-certified podiatrist and operator of a medical supply group purchasing organization, pleaded guilty by videoconference before U.S. District Judge Susan D. Wigenton to an information charging him with unlawfully selling prescription cancer medication, which had been previously purchased using his medical license and under the representation that such medication was to be used to treat his patients.
According to documents filed in this case and statements made in court:
While working in his medical practice’s offices in various locations in New Jersey, Lerner was recruited by an individual who owned a pharmacy and also owned and operated two businesses that were wholesale distributors of prescription drugs. At the request of this individual and others working with him, and in return for commissions and discounts on other medical supplies purchased by Lerner for his group purchasing organization, Lerner used his medical license – and allowed others to use it – to purchase expensive prescription drugs, primarily, cold-chain biologic infusion medications that typically are used to treat cancers, macular degeneration, and autoimmune diseases. By recruiting and using Lerner and his medical license to purchase the drugs, these individuals were able to obtain prescription drugs from the pharmaceutical manufacturers’ authorized distributors that they would not otherwise have been permitted to purchase. They were then able to sell them at a profit through their two businesses.
In purchasing the drugs, Lerner and the two individuals made numerous false and misleading representations to the pharmaceutical manufacturers and authorized distributors, including that Lerner purchased the drugs to use to treat his patients, and that the drugs would not be resold or redistributed. In actuality, none of the drugs were administered to Lerner’s patients, but were ultimately sold to customers of the two businesses for a profit. In an effort to obscure the fact that he was illegally buying and selling prescription drugs purchased under his medical license, Lerner sold and transferred the prescription drugs in the name of his group purchasing organization. The scheme ran from December 2014 through November 2018, during which more than $1.2 million in prescription drugs were purchased in Lerner’s name and using his medical license.
The sale of prescription drugs purchased by a healthcare entity is punishable by a maximum of three years in prison and a $10,000 fine. In his plea agreement, Lerner also agreed to make restitution for the full amount of any loss resulting from his offense. Sentencing is scheduled for July 18, 2023.
U.S. Attorney Sellinger credited special agents of the U.S. Food and Drug Administration’s Office of Criminal Investigations New York Field Office, under the direction of Special Agent in Charge Fernando P. McMillan; and special agents of U.S. Attorney’s Office, under the direction of Special Agent in Charge Thomas Mahoney, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorneys Diana Vondra Carrig and Sara A. Aliabadi of the U.S Attorney’s Office in Camden.
New Bedford Man Sentenced to 10 Years in Prison for Possessing Fentanyl Intended for DistributionRead the Press Release
BOSTON – A New Bedford man was sentenced today in federal court in Boston for possessing fentanyl, heroin, and cocaine for distribution.
Ramon Serrano, 44, was sentenced by U.S. District Court Judge Denise J. Casper to 10 years in prison and five years of supervised release. In September 2022, Serrano pleaded guilty to possession with intent to distribute 400 grams or more of fentanyl, cocaine, and heroin.
In February 2019, parole officers visited Serrano’s apartment while he was on probation for a heroin trafficking conviction. Inside the residence, officers observed a large amount of cash in plain view, a large bag a marijuana in a bedroom drawer and an open backpack that contained a large quantity of brown and white powder. During a subsequent search, over 544 grams of fentanyl and heroin as well as over 206 grams of cocaine – divided into separate plastic bags for distribution – were seized from Serrano’s apartment. Approximately $27,000, digital scales, cellular telephones and a money counter were also recovered.
United States Attorney Rachael S. Rollins and New Bedford Police Chief Paul Oliveira made the announcement. Assistant U.S. Attorneys Craig Estes and Charles Dell’Anno of Rollins’ Narcotics and Money Laundering Unit prosecuted the case.
Nigerian Man Sentenced for Mail Fraud Against a Dickinson, North Dakota CompanyRead the Press Release
BISMARCK – United States Attorney Mac Schneider announced that on February 23, 2023, U.S. District Court Judge Daniel M. Traynor sentenced Kolawole Bamidele Akande, age 37, from Nigeria, to serve 30 months in federal prison and ordered to pay $348,000 in restitution for committing the offense of Mail Fraud against a company located in Dickinson, North Dakota. On September 5, 2021, the defendant was arrested in the United Kingdom on this charge. Thereafter, on April 9, 2022, Akande was extradited from the United Kingdom to the District of North Dakota. On November 8, 2022, the defendant pleaded guilty to Mail Fraud.
While living in Dallas, Texas, Akande, as well as other codefendants, fraudulently obtained checks from a Dickinson, North Dakota, company through the mail and deposited these checks in fraudulent accounts at financial institutions located within the State of Texas. The Dickinson company was the victim of a computer intrusion scam that tricked the company’s controller into issuing checks totaling $348,000, which were deposited by Akande and codefendant Olawale Sule. This computer intrusion scheme caused the Dickinson company to sustain a loss of $298,000.
As part of this scheme to defraud, in November 2018, Akande used a fraudulent United Kingdom passport containing the fictitious name “Patric Elis Ferguson” to open a bank account at a Dallas, Texas, branch of Bank of America. On March 27, 2019, the controller of the Dickinson company received emails appearing to come from the company’s principal owners. The emails instructed the controller to mail a $192,000 check to an address in Dallas, Texas, payable to “Patel Retail and Logistics.” The controller sent, via overnight United Parcel Service (UPS) mail, the $192,000 check to the Dallas, Texas, address requested in the email. On March 28, 2019, Akande deposited the $192,000 check made payable to “Patel Retail and Logistics” into the Bank of America account that he had opened utilizing the fictitious name of “Patric Elis Ferguson.” Shortly thereafter, Akande either withdrew or transferred the funds to conceal and disguise their nature, location, source, and ownership.
Law enforcement conducted an investigation, which revealed that the Dickinson company was a victim of computer intrusion. Specifically, an unknown individual obtained access to the company’s principal owners’ Outlook 365 email accounts and sent the emails to the company’s controller directing the controller to mail the check to “Patel Retail and Logistics.”
The United States District Court for the District of North Dakota previously sentenced:
- Co-Defendant Olawale Sule a/k/a Brand King Mohammed, a/k/a John Thomas, on February 17, 2021, to serve two years’ imprisonment and payment of restitution on a charge of Conspiracy to Commit Bank Fraud.
- Co-Defendant Oluwafemi Elijah Olasode, on September 7, 2021, to time served imprisonment and payment of restitution on a charge of Misprision of Felony.
“Too often, swindlers believe they can evade justice because they are behind a computer or operating internationally,” Schneider said. “This sentence shows they should think again. This outcome is a credit to the skilled law enforcement investigators and prosecutors who patiently saw this case through.”
Link for Prior Press Release Unsealing the Indictment and Announcing Akande’s extradition from the United Kingdom to the United States are located below:
https://www.justice.gov/usao-nd/pr/federal-grand-jury-indicts-nigerian-nationals-multiple-fraud-schemes-against-dickinson-nd
https://www.justice.gov/usao-nd/pr/nigerian-man-extradited-united-states-united-kingdom-face-multiple-fraud-and-money
This case was investigated by the Federal Bureau of Investigation; United States Postal Inspection Service; Homeland Security Investigations; United States Attorney’s Office in the Northern District and Eastern District of Texas; and by the Office of International Affairs, Department of Justice, assisting with securing the extradition.
Assistant U.S. Attorney Jonathan J. O’Konek prosecuted this case.
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Nicaraguan National Pleads Guilty to Possessionwith Intent to Distribute 550 Kilograms of CocaineRead the Press Release
St. Croix, VI – United States Attorney Delia L. Smith announced that Michael Antony Nelson-Gaet, 34, of Nicaragua, pleaded guilty before Magistrate Judge Emile A. Henderson, III, to conspiracy to possess with intent to distribute cocaine while on board a vessel subject to the jurisdiction of the United States. Sentencing for Nelson-Gaet is set for June 21, 2023, where he faces a maximum of 20 years in prison. A federal district judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
According to court documents, on March 5, 2022, during a routine patrol in international waters, the United States Coast Guard Cutter Legare encountered the “La Bendecida Leo, a go-fast vessel located 140 nautical miles southwest of Isla de Malpelo, Columbia. The go-fast vessel was traveling at a high rate of speed with bales and fuel barrels visible on its deck. The vessel had no registration, but the occupants claimed Nicaraguan nationality for the vessel. Nicaragua could neither confirm nor deny nationality of the vessel. The vessel was therefore subject to the jurisdiction of the United States. The Coast Guard boarding team after members observed the occupants throwing the bales overboard. Approximately 550.6 kilograms of cocaine and 136 pounds of marijuana were recovered from the ocean.
The United States Coast Guard, Homeland Security Investigations and Drug Enforcement Administration are investigating this case, and Assistant United States Attorney Daniel H. Huston is prosecuting the case. This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
Michigan Man Sentenced to 15 Months in Prison for Conspiracy to Embezzle Labor Union FundsRead the Press Release
WASHINGTON – James Bradley, 44, of Grand Blanc, Michigan, was sentenced today to 15 months in prison for embezzling funds from a government employee union. The sentence was announced by United States Attorney Matthew M. Graves, FBI Special Agent in Charge Wayne A. Jacobs, of the Washington Field Office’s Criminal and Cyber Division, and Director Mark Wheeler, of the Washington District Office of the U.S. Department of Labor, Office of Labor-Management Standards. In addition to the prison term, Bradley must pay $205,421.82 in restitution, serve 36 months of supervised release, and 200 hours of community service.
According to court documents, between approximately October 2016 through May 2018, defendant James Bradley helped to embezzle approximately $205,421.82 from the American Federation of Government Employees (“AFGE”). He did so by enabling co-conspirator Donnell Owens—who worked at AFGE as a Secretary to the Director of Communications during the relevant period—to submit false and fraudulent check requests and invoices for non-existent videography services that the defendant purportedly provided to AFGE as an alleged vendor, but that the defendant never actually provided. As a result of these submissions, AFGE funds were subsequently disbursed for work that was never performed, including $205,421.82 to the defendant which he then split with Owens.
Bradley pleaded guilty on November 7, 2022, before U.S. District Court Judge Reggie B. Walton to one count of Conspiracy to Commit Embezzlement and Theft of Labor Union Assets. Another of Owens’s co-conspirators, Stacy Staples, 50, of District Heights, Maryland, also previously pleaded guilty to the same charge, and was ordered to pay $44,748 in restitution and sentenced to 3 years of probation. Owens also was previously convicted for spearheading the scheme and was ordered to pay $273,745 in restitution and sentenced to 15 months in prison.
In announcing the sentence, U.S. Attorney Graves, Special Agent in Charge Jacobs, and Director Wheeler commended the work of those who investigated the case from the FBI’s Washington Field Office and the U.S. Department of Labor, Office of Labor-Management Standards. They also expressed appreciation to those who worked on the case from the U.S. Attorney’s Office, including Assistant U.S. Attorneys Emily A. Miller, Anne P. McNamara, and Brian P. Kelly who investigated and prosecuted the case.
Mexican National Sentenced to Federal Prison for Distributing MethRead the Press Release
MIDLAND, Texas – A Mexican national was sentenced Wednesday in federal court in Midland to 294 months in prison for distributing methamphetamine.
According to court documents, Julio Cesar Banuelas-Gutierrez, 47, of Camargo, Chihuahua distributed one to one and a half pounds of methamphetamine every two weeks in the Midland-Odessa area, totaling at least 12 pounds of the drug. Investigators also found that on at least one occasion, Banuelas-Gutierrez had exchanged firearms for methamphetamine.
“The substantial sentence imposed in this case reflects our unwavering commitment to protect our communities and bring drug traffickers to justice,” said U.S. Attorney Jaime Esparza of the Western District of Texas. “My appreciation goes out to all the law enforcement officers involved, who made it possible for us to prosecute and put an end to this dealer’s activities.”
The Odessa and Midland Police Department Joint Task Force investigated the case.
Assistant U.S. Attorneys Joe Mahoney and Monica Daniels prosecuted the case.
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Maryland Law Firm Kandel & Associates, P.A., Agrees to Pay the United States Nearly $40,000 to Settle Claims That It Did Not Reimburse Medicare for Payments Made on Behalf of Firm ClientsRead the Press Release
Baltimore, Maryland – Erek L. Barron, United States Attorney for the District of Maryland, announced today that Kandel & Associates, P.A., a Baltimore-based law firm, and Nelson R. Kandel, Esq., have entered into a settlement agreement with the United States to resolve allegations that they failed to reimburse the United States for certain Medicare payments the Government had previously made to medical providers on behalf of firm clients.
The Government’s investigation arose under the Medicare Secondary Payer (“MSP”) provisions of the Social Security Act, which authorizes Medicare, as a secondary payer, to make conditional payments for medical items or services under certain circumstances. When an injured person receives a tort settlement or judgment, Medicare law requires persons or entities who receive the settlement or judgment proceeds, including the injured person’s attorney, to repay Medicare for its conditional payments. If Medicare does not receive timely repayment, these same laws and regulations permit the Government to recover the conditional payments from the injured person’s attorney and others who received the settlement or judgment proceeds.
The Government alleges that, over many years, Medicare made conditional payments to healthcare providers to satisfy medical bills for firm clients. During that period, the firm negotiated for and received settlement proceeds for the firm’s clients, but neither the firm nor its clients repaid Medicare for conditional payments it made to medical providers. This settlement resolves the Government’s claims that the firm and Mr. Kandel failed to resolve at least twelve MSP debts. The Government alleges that the firm disbursed settlement proceeds to clients without confirming the existence of an MSP debt. Under the terms of the settlement agreement, the firm and Mr. Kandel agreed to pay the United States $39,828.66 to resolve the Government’s claims.
The firm and Mr. Kandel also agreed to designate a person at the firm responsible for paying MSP debts; train the designated employee to ensure that the firm pays MSP debts on a timely basis; and periodically review any outstanding MSP debts with the designated employee to ensure compliance.
The claims resolved by this settlement are allegations. The settlement is not an admission of liability by the firm or Mr. Kandel, nor a concession by the United States that its claims are not well founded.
This settlement should remind attorneys of their obligation to reimburse Medicare for conditional payments after receiving settlement or judgment proceeds for their clients. The attorneys’ obligation to reimburse Medicare for conditional payments exists regardless of whether they disburse settlement proceeds to their clients before the Centers for Medicare & Medicaid Services contacts them about the existence of an MSP debt. When attorneys receive settlement funds in personal injury cases, they have an independent obligation to confirm whether their clients received conditional payments from Medicare.
“Plaintiffs’ attorneys cannot simply rely on their clients’ representations about their status as Medicare beneficiaries and ignore their obligations to reimburse Medicare for its conditional payments,” said U.S. Attorney Erek L. Barron. “This is the third matter our office has resolved with attorneys who fail to make good on their obligations to repay Medicare for its conditional payments, and we will continue to investigate these matters, regardless of when settlement distributions are made, and regardless of what clients tell their attorneys regarding their status as Medicare beneficiaries.”
U.S. Attorney Erek L. Barron commended Eric Wolfish, Assistant Regional Counsel, United States Department of Health and Human Services, Office of the General Counsel, Region III, for his work in the investigation. Mr. Barron also thanked Assistant United States Attorney Alan C. Lazerow, who handled the case.
For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit https://www.justice.gov/usao-md and https://www.justice.gov/usao-md/community-outreach.
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Man Who Supplied Heroin to Waterbury Drug Ring Sentenced to More Than 5 Years in Federal PrisonRead the Press Release
Vanessa Roberts Avery, United States Attorney for the District of Connecticut, announced that JESUS NIEVES, also known as “Pop,” 39, formerly of Waterbury, Connecticut, and Springfield, Massachusetts, was sentenced today by U.S. District Judge Vanessa L. Bryant in Hartford to 63 months of imprisonment, followed by five years of supervised release, for supplying heroin to a member of a Waterbury-area drug trafficking ring.
According to court documents and statements made in court, in May 2020, the DEA New Haven Task Force and Waterbury Police Department began an investigation into a drug trafficking organization that was distributing large amounts of heroin, cocaine and crack in the Waterbury area, and was believed to be headed by Zachary Lee Foster, who worked closely with Jason Metz of Naugatuck. The investigation included court-authorized wiretaps on multiple phones used by members of the organization, physical surveillance, controlled purchases of narcotics, and motor vehicle stops that resulted in the seizure of drugs. The investigation revealed that Nieves supplied Metz with pre-packaged heroin that Metz redistributed to others.
On March 1, 2021, a federal grand jury in New Haven returned an indictment charging Nieves, Foster, Metz and 14 others.
Nieves, Foster, Metz, and several associates were arrested on March 3, 2021. In association with these arrests, law enforcement executed seven search warrants and seized approximately 40,000 bags of suspected heroin, 350 grams of cocaine and 50 grams of crack cocaine, and nine firearms.
Nieves has been detained since his arrest. On April 26, 2022, he pleaded guilty to one count of conspiracy to distribute 100 grams or more of heroin.
Foster and Metz also pleaded guilty. On June 8, 2022, Metz was sentenced to 10 years of imprisonment. Foster awaits sentencing.
This investigation has been conducted by the Drug Enforcement Administration New Haven Task Force and the Waterbury Police Department. 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 case is being prosecuted by Assistant U.S. Attorneys Patrick F. Caruso and Brendan Keefe 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.
U.S. Attorney Avery thanked the State’s Attorney’s Office for the Judicial District of Waterbury for its close cooperation in investigating and prosecuting this matter.
Man Pleads Guilty to $55M Investment Fraud SchemeRead the Press Release
A Florida man pleaded guilty today to orchestrating an investment fraud scheme that defrauded more than 10,000 victims of over $55 million.
According to court documents, Michael Glaspie, 72, of Palm City, marketed an investment opportunity under the name “CoinDeal” or “Coin Deal.” Glaspie claimed that CoinDeal would yield extremely high returns on the premise that one or more technology companies – operated under the banner of “ViRSE” and allegedly owned by Neil Suresh Chandran – was about to be acquired by a consortium of wealthy buyers. To entice investors to put money into CoinDeal, Glaspie falsely promised that in the event the returns from CoinDeal failed to materialize, he would repay investors their money with seven percent annual interest over three years. In fact, Glaspie knew he had no means of making such repayments.
“For his brazen and repeated lies that defrauded more than 10,000 victims out of more than $55 million, the defendant now justifiably faces a lengthy prison term,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “The Department of Justice is committed to rooting out investment fraud and holding wrongdoers accountable to protect the financial security of all Americans.”
To support his false repayment promise, Glaspie deceptively claimed that he had an exclusive and lucrative contract with AT&T to distribute government‑funded phones, and that an app that he developed was being distributed by the Better Business Bureau and would yield over $400 million in revenue, when he had no such contract or distribution agreement. Furthermore, when the promised sale of CoinDeal did not close, Glaspie transmitted investor funds to Chandran after falsely representing to CoinDeal investors that he would not do so. Glaspie also falsely claimed that he never paid himself with CoinDeal investor funds, when in truth, he misappropriated nearly $2.5 million of victim investments for personal purposes, including trading cryptocurrency, paying his employees’ salaries, and buying a life insurance policy for a family member.
“Michael Glaspie admitted today to his involvement in a widespread scheme to defraud investors for his personal benefit,” said U.S. Attorney Steven A. Russell for the District of Nebraska. “Thanks to the tireless efforts of our law enforcement partners to untangle this fraud, Glaspie will now be held accountable for this serious crime.”
“This case identified a fraudulent online investment scheme that defrauded over 10,000 victims,” said Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division. “The subject promised investors high rates of returns then misused investor funds for personal use. The FBI and our law enforcement partners will continue to work diligently to identify and pursue those who seek to deceive and defraud the American public.”
“This elaborate investment fraud scheme defrauded more than 10,000 victims of over $55 million,” said Assistant Director in Charge David Sundberg of the FBI Washington Field Office. “Investment fraud schemes of any type will not be tolerated. The FBI will continue to do what we have done for over 100 years and investigate those who attempt to defraud unsuspecting Americans of their hard-earned money. I would like to thank our partners at FBI offices across the country and the Department of Justice for their work and collaboration to bring justice on behalf of these victims.”
Glaspie pleaded guilty to one count of wire fraud. He is scheduled to be sentenced on June 16 and faces a maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Separately, on June 14, 2022, a federal grand jury in the District of Nebraska returned an indictment charging Chandran with three counts of wire fraud and two counts of engaging in monetary transactions in criminally derived property for his role in the scheme. If convicted, he faces up to 20 years in prison for each of the wire fraud counts and up to 10 years in prison for each count of engaging in unlawful monetary transactions. An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The FBI Washington, Omaha, Las Vegas, and Los Angeles Field Offices are investigating the cases.
Assistant Chief William E. Johnston and Trial Attorney Tian Huang of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Donald J. Kleine for the District of Nebraska are prosecuting the cases.
All potential investor victims of this fraud are encouraged to visit the webpage https://www.justice.gov/criminal-vns/united-states-v-chandran to identify themselves and obtain more information on their rights, including the opportunity to submit a victim impact statement.
Man Arrested for Cold Case Murder on Military Base in GermanyRead the Press Release
A man was arrested today in the Northern District of Florida on criminal charges related to a murder on a U.S. Army base in Germany 21 years ago.
According to court documents, Shannon L. Wilkerson, 42, is allegedly responsible for the death of Amanda Gonzales on Nov. 3, 2001. The murder occurred at Fliegerhorst Kaserne, then a U.S. Army base in Hanau, Germany. Wilkerson was a member of the Armed Forces at the time of the alleged offense but was later discharged from the Army.
Wilkerson is charged under the Military Extraterritorial Jurisdiction Act, which gives the U.S. federal courts jurisdiction over crimes committed outside the United States by, among others, former members of the Armed Forces who are no longer subject to the Uniform Code of Military Justice.
Wilkerson is charged with one count of first-degree murder. If convicted, he faces a maximum penalty of life in prison.
Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, U.S. Attorney Jason R. Coody for the Northern District of Florida, Assistant Director in Charge Michael J. Driscoll of the FBI New York Field Office, and Special Agent in Charge Lisa Yockel of the U.S. Army Criminal Investigation Division’s Europe Field Office made the announcement.
The FBI is investigating the case. The FBI Jacksonville Field Office, the Air Force’s Office of Special Investigations, and Army’s Criminal Investigative Division, which originally investigated the case, provided valuable assistance with the arrest.
Trial Attorney Patrick Jasperse of the Criminal Division’s Human Rights and Special Prosecutions Section and Assistant U.S. Attorney David L. Goldberg for the Northern District of Florida are prosecuting the case.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Man Arrested for Cold Case Murder on Military Base in GermanyRead the Press Release
A man was arrested today in the Northern District of Florida on criminal charges related to a murder on a U.S. Army base in Germany 21 years ago.
According to court documents, Shannon L. Wilkerson, 42, is allegedly responsible for the death of Amanda Gonzales on Nov. 3, 2001. The murder occurred at Fliegerhorst Kaserne, then a U.S. Army base in Hanau, Germany. Wilkerson was a member of the Armed Forces at the time of the alleged offense but was later discharged from the Army.
Wilkerson is charged under the Military Extraterritorial Jurisdiction Act, which gives the U.S. federal courts jurisdiction over crimes committed outside the United States by, among others, former members of the Armed Forces who are no longer subject to the Uniform Code of Military Justice.
Wilkerson is charged with one count of first-degree murder. If convicted, he faces a maximum penalty of life in prison.
Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, U.S. Attorney Jason R. Coody for the Northern District of Florida, Assistant Director in Charge Michael J. Driscoll of the FBI New York Field Office, and Special Agent in Charge Lisa Yockel of the U.S. Army Criminal Investigation Division’s Europe Field Office made the announcement.
The FBI is investigating the case. The FBI Jacksonville Field Office, the Air Force’s Office of Special Investigations, and Army’s Criminal Investigative Division, which originally investigated the case, provided valuable assistance with the arrest.
Trial Attorney Patrick Jasperse of the Criminal Division’s Human Rights and Special Prosecutions Section and Assistant U.S. Attorney David L. Goldberg for the Northern District of Florida are prosecuting the case.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
MS-13 Members Sentenced to Life in Prison for Racketeering, Murder, Extortion, and Federal Drug ChargesRead the Press Release
Greenbelt, Maryland – U.S. District Judge Paula Xinis has sentenced Luis Flores-Reyes, a/k/a “Maloso,” “Lobo,”’ and “Viejo Lovvon,” age 42, of Arlington, Virginia and Jairo Jacome, a/k/a “Abuelo,” age 40, of Langley Park, Maryland, to life in federal prison, for charges related to a racketeering enterprise known as La Mara Salvatrucha, or “MS-13.” Jacome and Flores-Reyes were convicted by a federal jury on September 29, 2022, of a racketeering conspiracy, murder in aid of racketeering, and an extortion conspiracy. The jury also found Flores-Reyes guilty of a drug distribution conspiracy. Flores-Reyes was sentenced yesterday and Jacome was sentenced today.
On January 12, 2023, Judge Xinis also sentenced co-defendant Brayan Contreras-Avalos, a/k/a “Anonimo” and “Humilde,” age 28, of Langley Park, Maryland, to life in federal prison for his participation in the same racketeering conspiracy.
The sentences were announced by United States Attorney for the District of Maryland Erek L. Barron; Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division; Special Agent in Charge Wayne Jacobs of the Federal Bureau of Investigation - Washington Field Office Criminal Division; Special Agent in Charge Frank A. Tarentino III of the Drug Enforcement Administration – New York Division; Special Agent in Charge James C. Harris of Homeland Security Investigations (HSI) Baltimore; Chief Malik Aziz of the Prince George’s County Police Department; and Chief Marcus Jones of the Montgomery County Police Department.
MS-13 is a national and international gang composed primarily of immigrants or descendants from El Salvador and other central American countries. Branches or “cliques” of MS-13, one of the largest street gangs in the United States, operate throughout Frederick County, Anne Arundel County, Prince George’s County, and Montgomery County, Maryland. Jacome was the highest-ranking member of the local Langley Park Salvatrucha, or “LPS” clique. Flores-Reyes and Contreras-Avalos were leaders within the Sailors Clique, which held territory in Maryland, Virginia, New York, New Jersey, Texas, and El Salvador.
At all times of this conspiracy, members of MS-13 were expected to protect the name, reputation, and status of the gang and to use any means necessary to force respect from those who showed disrespect, including acts of intimidation and violence. One of the principal rules of MS-13 is that its members must attack and kill rivals, often referred to as “chavalas,” whenever possible. Participation in criminal activity by a member, particularly in violent acts directed at rival gangs or as directed by gang leadership, increase the respect accorded to that member, resulting in that member maintaining or increasing his position in the gang, and opens the door to promotion to a leadership position.
As detailed during the trial, Flores-Reyes, Jacome, and Contreras-Avalos participated in at least six murders, including two minor victims, during the period of the conspiracy. Most of the victims were purported gang rivals except for one minor victim. For example, in June 2016, members of MS-13, including Contreras-Avalos, stabbed to death two unhoused individuals, who gang members believed to be members of the 18th Street gang, in Hyattsville, Maryland. The investigation revealed no evidence that the victims were in fact members of any gang.
Among the most important rules of MS-13 is the prohibition against talking to law enforcement, embodied by the maxim ver, oir, y callar – see, hear, and say nothing. The gang enforced this rule by placing a “green light” – an order to kill – on any member of MS-13 who was thought to be informing on the gang. In December 2016, Jacome directed and participated in the murder of a 14-year-old member of MS-13 who was suspected of talking to the police. The boy’s remains were discovered more than 18 months later in a wooded area outside of Germantown, Maryland.
Additionally, in March 2017, a member of the Sailors Clique, who was hiding from law enforcement in the Lynchburg, Virginia, area, after committing a murder in 2016 in Gaithersburg, Maryland, had a dispute with a local high school student over marijuana. In response, Flores-Reyes aided and abetted a squad of MS-13 members to drive down to Lynchburg and murder this high school student. The gang members kidnapped the student from his front lawn and cut his hand off before killing him. After the murder, Flores-Reyes helped to hide and protect the killers from law enforcement.
According to court documents and evidence presented at trial, the defendants also ran an extortion scheme in and around Langley Park, extorting local businesses by charging them “rent” for the privilege of operating in MS-13 “territory.” Flores-Reyes and Contreras-Avalos also trafficked illegal drugs, including marijuana, and cocaine. A large share of the proceeds of the gang’s illegal activities were sent to gang leadership in El Salvador to further promote the illicit activities of the gang, using structured transactions and intermediaries to avoid law enforcement scrutiny.
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 make our neighborhoods safer for everyone. Project Safe Neighborhoods (PSN) is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
This case is an Organized Crime Drug Enforcement Task Force (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
Anyone with information about MS-13 is encouraged to provide their tips to law enforcement. The FBI and Homeland Security Investigations both have nationwide tiplines that you can call to report what you know. You can reach the FBI at 1-866-STP-MS13 (1-866-787-6713), or you can call HSI at 1-866-DHS-2-ICE.
United States Attorney Erek L. Barron and Assistant Attorney General Kenneth A. Polite, Jr. commended the FBI, DEA, HSI, Prince George’s County Police Department, Montgomery County Police Department, Virginia State Police, Lynchburg Police Department, Prince William County Police Department, Nassau County District Attorney’s Office, the Bedford County Commonwealth’s Attorney’s Office and the Bedford County Sheriff’s Office for their work in the investigation. Mr. Barron and Mr. Polite thanked Assistant U.S. Attorneys Timothy F. Hagan, Chris M. Sarma, William Moomau, Assistant Director Catherine Dick of the Department of Justice Consumer Protection Division and Trial Attorney Alexander Gottfried of the Justice Department’s Criminal Division, who prosecuted this case.
For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit https://www.justice.gov/usao-md/project-safe-neighborhoods-psnexile and https://www.justice.gov/usao-md/community-outreach.
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Luzerne County Man Pleads Guilty to Fentanyl Trafficking and Firearms OffensesRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Rasjon Walters, age 27, of Wilkes-Barre, Pennsylvania, pleaded guilty on February 21, 2023, before U.S District Court Judge Robert D. Mariani, to one count of fentanyl distribution and one count of carrying a firearm in relation to a drug trafficking crime.
According to United States Attorney Gerard M. Karam, Walters admitted to distributing fentanyl in the Luzerne County area between June 2021 and December 2021. He also admitted to using and carrying a firearm during and in relation to a drug trafficking crime. The charges stem from an investigation in which investigators made multiple purchases of fentanyl and a firearm from Walters. Investigators then obtained a search warrant for Walters’ residence in Wilkes-Barre and seized additional amounts of fentanyl, packaging materials, scales, and other items of drug paraphernalia.
The investigation was conducted by the FBI Safe Streets Task Force, the Pennsylvania State Police, and the Wilkes-Barre Police Department. Assistant United States Attorney Robert J. O’Hara is prosecuting the case.
This case is also 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.
Under federal law, the charges carry a maximum sentence of life in prison, a term of supervised release following imprisonment, and a fine. A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
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Lowell Money Manager Sentenced to More Than Nine Years in Prison for Defrauding Clients of Millions of DollarsRead the Press Release
BOSTON – A Lowell man was sentenced today in federal court in Boston for engaging in a scheme to defraud his clients of millions of dollars.
Steven Xigoros, 55, was sentenced by U.S. District Court Judge Nathaniel M. Gorton to 109 months in prison and two years of supervised release. Xigoros was also ordered to pay $4,754,184 in restitution to individual victims and the Internal Revenue Service and forfeiture in the amount of $4,321,106. In October 2022, Xigoros pleaded guilty to two counts of wire fraud, one count of aggravated identity theft, and one count of filing a false tax return.
Between 2015 and 2021, Xigoros used his position as an accountant, tax preparer and investment advisor to misappropriate millions of dollars from his clients. He induced clients to entrust their money to him to make various investments, to purchase securities, and to lend him money for purported business ventures. Xigoros then used those funds for his own expenses, including to make payments against his gambling debts. In order to deceive his clients about the fact that he had stolen their money, Xigoros made a series of false statements about how their money was purportedly invested and when he would repay it. In total, Xigoros defrauded his clients of more than $4.3 million, including the entire life savings of one elderly couple, who gave more than $1.3 million to him to make investments on their behalf. By failing to report the misappropriated funds as income, Xigoros also failed to pay taxes due and owing of more than $1 million to the Internal Revenue Service.
“For more than five years, Mr. Xigoros used his position to steal millions of dollars from his trusting clients. His victims saw him as a reliable, safe investment advisor – he had years of professional experience and many of the victims’ trust as a fellow member of their close-knit Greek community. Eventually, as his gambling debts grew, Mr. Xigoros chose to abuse this trust and rob his clients of more than $4.3 million,” said United States Attorney Rachael S. Rollins. “The financial hardship, trauma and shame inflicted as a result of Mr. Xigoros’ fraud cannot be overstated. In some circumstance it may last a lifetime and have generational impacts. He callously exploited vulnerable victims out of their hard-earned life savings and went to great lengths to conceal his theft. It is my hope that today’s sentence brings a sense of closure and accountability to those impacted by Mr. Xigoros’ egregious, shameful and criminal conduct.”
“Steven Xigoros stole millions from his long-time clients, betraying their trust, and cheating taxpayers, primarily to pay off his gambling debts,” said Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division. “Equally troubling is that he took advantage of some of those closest to him, including wiping out an elderly couple’s entire life savings. The FBI had to re-arrest Xigoros as he tried to flee the country to avoid prosecution. Today’s sentence ensures he will have plenty of time behind bars to reflect on his criminal conduct.”
“The defendant knowingly exposed individuals’ finances, their life savings in some cases, to sham investments and shady business ventures, creating financial devastation that will unfortunately last a lifetime for many,” said Joleen D. Simpson, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston. “Today's sentencing demonstrates that federal law enforcement collaboration is a powerful tool in thwarting criminal behavior and IRS Criminal Investigation is proud to bring our forensic accounting skills to this joint venture and help put a stop to this and other types of white collar crime.”
While on pre-trial release, Xigoros was arrested at the Newark Liberty International Airport, boarding a flight to Greece in an attempt to flee approximately two months before he was set to stand trial.
U.S. Attorney Rollins, FBI SAC Bonavolonta, and IRS SAC Simpson made the announcement. Assistant U.S. Attorneys Leslie Wright and David Holcomb of Rollins’ Securities, Financial & Cyber Fraud Unit prosecuted the case.
Lebanon Man Indicted on Attempted Child Enticement and Production of Child Pornography ChargesRead the Press Release
SCRANTON- The United States Attorney’s Office for the Middle District of Pennsylvania announced that Mason Morey, age 26, of Lebanon, Pennsylvania, was indicted by a federal grand jury on one count of attempted online enticement and 14 counts of production of child pornography.
According to United States Attorney Gerard M. Karam, the superseding indictment alleges that between November 28, 2022 and December 8, 2022, Morey used the internet to attempt to entice a minor to engage in sexual activity. It further alleges that on December 7, 2022, Morey produced images and videos of child pornography. Agents with Homeland Security Investigations arrested Morey on December 8, 2022, on the attempted online enticement charges in Wilkes-Barre, Pennsylvania. Following an initial appearance on the charge, U.S. Magistrate Judge Joseph F. Saporito, Jr. ordered Morey to be detained pending trial on the charge.
The case was investigated by Homeland Security Investigations (HSI). Assistant U.S. Attorney Jenny P. Roberts is prosecuting the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
The maximum penalty under federal law for this offense is lifetime imprisonment, a term of supervised release following imprisonment, and a fine. A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
Indictments are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
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Las Vegas Man Sentenced to Prison for $12 Million Advance Fee Telemarketing Scheme Targeting Small Business OwnersRead the Press Release
LAS VEGAS – A Las Vegas resident was sentenced yesterday by U.S. District Judge Kent J. Dawson to 78 months in prison followed by five years of supervised release for defrauding hundreds of small business owners – many of them elderly – of about $12 million.
Michael Jones (43) pleaded guilty to two counts of conspiracy to commit mail fraud and wire fraud and 10 counts of wire fraud. In addition to the prison term, Jones was ordered to pay restitution in the total amount of $11,509,087.67 to the victims, and a forfeiture money judgment in the total amount of $7,934,095.32.
According to court documents, from October 2009 to February 2014, Jones and his co-defendants convinced more than 2,100 small business owners to pay nearly $12 million for what Jones and his co-defendants described as advance fees to fund expenses to apply for supposed government, private and charitable grants for the victims’ businesses. Following a script, Jones and others would falsely tell the victims that government, private and charitable organizations would provide grants to them regardless of the type of business they operated, but the victim first needed to pay thousands of dollars in fees to access those grants. Jones and his co-defendants induced the small business owners to give them money in exchange for services that were never provided. The scheme functioned solely to enrich Jones and his co-defendants.
United States Attorney Jason M. Frierson for the District of Nevada and Special Agent in Charge Spencer L. Evans for the FBI made the announcement.
The FBI investigated the case. Assistant U.S. Attorney Dan Cowhig prosecuted the case.
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Lafayette Man Sentenced for Possessing Stolen FirearmRead the Press Release
LAFAYETTE, La. – Bernell George, 39, of Lafayette, Louisiana, was sentenced today for possession of a stolen firearm, announced United States Attorney Brandon B. Brown. United States District Judge Terry A. Doughty sentenced George to 115 months in prison, followed by 3 years of supervised release.
George pleaded guilty November 10, 2022, to a bill of information charging him with one count of possession of a stolen firearm. The charge stems from an incident on September 20, 2017, when George was found in possession of 15.7 grams of marijuana, a hand rolled cigarette containing marijuana, and a Smith & Wesson .40 caliber handgun with 11 rounds of ammunition in the magazine. Through their investigation, law enforcement officers learned that the firearm was stolen out of Iberia Parish. George admitted to possessing the marijuana and buying the stolen firearm off the street.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and Lafayette Police Department and prosecuted by Assistant U.S. Attorney John W. Nickel.
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Keys Lobster Company Sentenced for Exporting Falsely Labelled ProductRead the Press Release
MIAMI – A federal judge in Key West, Florida has sentenced Elite Sky International, Inc. (Elite), a company that operates on Overseas Highway in Marathon, to a quarter million dollar fine and five years of probation for exporting falsely labelled spiny lobster and shark fins from Florida to China.
According to court documents, from November 2018 through October 2019, Elite purchased seafood products for export to China. To meet the high demand for spiny lobster, Elite imported lobster from Nicaragua and Belize for reexport to China. Elite reexported approximately 63,000 pounds of lobster and falsely labeled the product in shipping documents as “Live Florida Spiny Lobsters, Product of U.S.A.” In a similar violation, Elite acquired shark fins from a licensed local fisherman in Florida and exported approximately 5,666 pounds of shark fins, falsely labeling he product either as “Live Florida Spiny Lobsters, Product of U.S.A.” or “Frozen Fish.”
The court ordered Elite to pay a total of $250,000 and placed it on probation for five years. Additionally, the court ordered, as special conditions of probation, that the company establish a corporate compliance program and retain third-party independent auditors to oversee their future activities.
U.S. Attorney Markenzy Lapointe for the Southern District of Florida, Assistant Director Manny Antonaras of the National Oceanic & Atmospheric Administration (NOAA), Southeast Division, acting Special Agent in Charge Michael E. Buckley, Homeland Security Investigations (HSI), Miami, and Major Alberto Maza, Regional Commander of the Florida Fish and Wildlife Conservation Commission (FWC), Division of Law Enforcement, South B Region, announced the sentence imposed by United States District Judge K. Michael Moore.
NOAA Office of Law Enforcement, HSI Miami, and FWC Division of Law Enforcement investigated this case. Assistant U.S. Attorney Thomas Watts-FitzGerald prosecuted the case.
If you have any information regarding this investigation, or other wildlife crimes, you may contact the NOAA Office of Law Enforcement Hotline: (800) 853-1964 and the U.S. Fish & Wildlife Service at 1-800-344-9453. Locally, environmental crimes, including wildlife violations and environmental justice matters may be reported to the U.S. Attorney’s Office at 305-961-9001 or [email protected] .
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or at http://pacer.flsd.uscourts.gov, under case number 22-cr-10011.
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Kentucky Man Charged with Running Cocaine Distribution OperationRead the Press Release
TULSA, Okla. – A Hopkinsville, Kentucky, man made an initial appearance in federal court Wednesday after being indicted for drug conspiracy and related charges, announced U.S. Attorney Clint Johnson for the Northern District of Oklahoma.
Melvin Dontreele Brown, 30, was arrested Tuesday in Hopkinsville, Kentucky. Law enforcement executed search warrants at four different locations there associated with Brown and on multiple bank accounts. Initial items recovered include approximately $100,000 in cash, $164,000 from bank accounts, marijuana, fentanyl, and a firearm.
Brown is charged with one count of drug conspiracy; two counts of laundering of monetary instruments; and 14 counts of use of a communication facility in committing, causing and facilitating the commission of a drug trafficking felony.
Brown is accused of conspiring with others to possess with intent to distribute 500 grams or more of cocaine and to distribute 500 grams or more of cocaine.
According to the indictment, Brown and his coconspirators allegedly distributed bulk quantities of cocaine in the Hopkinsville and Tulsa areas from July 2020 to May 2021 .
The cocaine was allegedly imported from Mexico and transported by couriers in vehicles to Oklahoma and to Brown in Kentucky. The conspirators regularly used cellphones and coded phrases to coordinate their drug transactions. Examples of coded language included “ceiling paint” which referenced cocaine and “paper” which referenced currency used as payment for cocaine deliveries.
The conspirators received bulk quantities of currency as payment for cocaine deliveries and conducted financial transactions using banks in the Northern District of Oklahoma and elsewhere. Brown is charged in the indictment with making two financial transactions designed to conceal the nature and origin of the illicit proceeds.
Brown made an initial appearance in the Western District of Kentucky (Paducah) Wednesday and is scheduled for a detention hearing there Friday at 10 am.
The prosecution is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
The Drug Enforcement Administration’s Dallas and Louisville Divisions and the Tulsa and Hopkinsville Police Departments are the investigative agencies. Assistant U.S. Attorney Ben Tonkin is prosecuting the case.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
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Kentucky Man Charged with Running Cocaine Distribution OperationRead the Press Release
A Hopkinsville, Kentucky, man made an initial appearance in federal court Wednesday after being indicted for drug conspiracy and related charges, announced U.S. Attorney Clint Johnson for the Northern District of Oklahoma.
Melvin Dontreele Brown, 30, was arrested Tuesday in Hopkinsville, Kentucky. Law enforcement executed search warrants at four different locations there associated with Brown and on multiple bank accounts. Initial items recovered include approximately $100,000 in cash, $164,000 from bank accounts, marijuana, fentanyl, and a firearm.
Brown is charged with one count of drug conspiracy; two counts of laundering of monetary instruments; and 14 counts of use of a communication facility in committing, causing and facilitating the commission of a drug trafficking felony.
Brown is accused of conspiring with others to possess with intent to distribute 500 grams or more of cocaine and to distribute 500 grams or more of cocaine.
According to the indictment, Brown and his coconspirators allegedly distributed bulk quantities of cocaine in the Hopkinsville and Tulsa areas from July 2020 to May 2021 .
The cocaine was allegedly imported from Mexico and transported by couriers in vehicles to Oklahoma and to Brown in Kentucky. The conspirators regularly used cellphones and coded phrases to coordinate their drug transactions. Examples of coded language included “ceiling paint” which referenced cocaine and “paper” which referenced currency used as payment for cocaine deliveries.
The conspirators received bulk quantities of currency as payment for cocaine deliveries and conducted financial transactions using banks in the Northern District of Oklahoma and elsewhere. Brown is charged in the indictment with making two financial transactions designed to conceal the nature and origin of the illicit proceeds.
Brown made an initial appearance in the Western District of Kentucky (Paducah) Wednesday and is scheduled for a detention hearing there Friday at 10 am.
The prosecution is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
The Drug Enforcement Administration’s Dallas and Louisville Divisions and the Tulsa and Hopkinsville Police Departments are the investigative agencies. Assistant U.S. Attorney Ben Tonkin is prosecuting the case.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law
Kanawha County Man Pleads Guilty to Methamphetamine ConspiracyRead the Press Release
CHARLESTON, W.Va. – Justin Allen Bowen, 40, of Charleston, pleaded guilty today to conspiracy to distribute 50 grams or more of methamphetamine.
According to court documents and statements made in court, Bowen received methamphetamine from his supplier for several months prior to December 5, 2022. Bowen would receive several pounds of methamphetamine at a time and distribute it to several of his customers throughout Kanawha County.
On December 5, 2023, law enforcement officers executed search warrants at locations where Bowen had delivered methamphetamine the night before and seized a total of approximately 15 pounds of methamphetamine found in three locations.
Bowen is scheduled to be sentenced on June 8, 2023, and faces a faces a mandatory minimum of 10 years and up to life in prison, five years and up to a lifetime of supervised release, and a $10 million fine.
Jasper Wemh, Richard Allen Bowen, McKenzie Bowen, Kimberly Dawn Legg, Larry Wayne Legg, Nicholas Bradford Confere, and Stanley Aaron Burkes were indicted along with Justin Allen Bowen and are scheduled for trial on April 25, 2023. An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
United States Attorney Will Thompson made the announcement and commended the investigative work of the Federal Bureau of Investigation (FBI), Metropolitan Drug Enforcement Network Team (MDENT), Charleston Police Department, West Virginia State Police, Drug Enforcement Administration (DEA), and Kanawha County Sheriff’s Office.
Chief United States District Judge Thomas E. Johnston presided over the hearing. Assistant United States Attorneys Jeremy B. Wolfe and Nowles Heinrich are prosecuting the case.
The investigation was part of the Department of Justice’s Organized Crime Drug Enforcement Task Force (OCDETF). OCDETF was established in 1982 to conduct comprehensive, multilevel attacks on major drug trafficking and money laundering organizations and is the keystone of the Department of Justice’s drug reduction strategy. Today, OCDETF combines the resources and expertise of its member federal agencies in cooperation with state and local law enforcement. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking organizations, transnational criminal organizations, and money laundering organizations that present a significant threat to the public safety, economic, or national security of the United States.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 2:23-cr-4.
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KC Woman Sentenced for SNAP Benefits FraudRead the Press Release
KANSAS CITY, Mo. – A Kansas City, Mo., woman was sentenced in federal court today for using six stolen identities to fraudulently file 71 Supplemental Nutrition Assistance Program (SNAP) benefits in four states.
Bridgette Ford, 62, was sentenced by U.S. District Judge Howard F. Sachs to four years and six months in federal prison without parole. The court also ordered Ford to pay $66,684 in restitution.
On July 28, 2022, Ford pleaded guilty to one count of mail fraud, one count of theft of government money, one count of misuse of a Social Security number, and one count of aggravated identity theft.
Ford received SNAP benefits (formerly known as food stamps) from May 2018 through January 2020. During that time, she submitted six fraudulent applications for Missouri SNAP benefits using the names, Social Security numbers, and other identity information stolen from six victims. She listed her own email address and phone number on each fraudulent application, and she claimed the applicants were homeless. She directed all communication from the Department of Social Services regarding the fraudulent applications to be sent to her home address. When state officials required applicant interviews, she either assumed the identity she had stolen and conducted the interview herself, or she instructed one of her acquaintances to do it.
The Department of Social Services approved all six fraudulent applications for SNAP benefits. When Ford received the fraudulent EBT cards for the six accounts, she sold them for cash (or gave them to others to sell for cash) to buyers who then used the benefits on the cards. After they used the EBT cards to make purchases, they returned the cards to Ford.
Ford filed 71 SNAP benefit applications in four different states. She fraudulently received at least $21,546 in SNAP benefits between July 2018 through November 2020 under her own name in Missouri, Indiana, Iowa, and Illinois. In addition, Ford fraudulently filed multiple applications for SNAP benefits under the names of others in those states and subsequently received $45,138 in additional benefits based on those applications.
Ford also concealed a disqualifying prior felony drug conviction in her own Missouri SNAP application and received SNAP benefits to which she was not entitled. Ford’s conduct resulted in a total SNAP benefits loss of $66,684.
This case was prosecuted by Special Assistant U.S. Attorney Courtney R. Pratten. It was investigated by the Missouri Department of Social Services and the Social Security Administration – Office of Inspector General.
KC Woman Sentenced for CarjackingRead the Press Release
KANSAS CITY, Mo. – A Kansas City, Mo., woman was sentenced in federal court today for her role in a carjacking.
Kerri J. Seaboldt, 32, was sentenced by U.S. District Judge Howard F. Sachs to nine years in federal prison without parole.
On April 1, 2022, Seaboldt pleaded guilty to one count of carjacking and one count of brandishing a firearm in furtherance of a crime of violence. Seaboldt admitted that she aided and abetted two co-defendants to steal a 2018 Chevrolet Camaro at gunpoint on July 14, 2020.
In the early morning hours of July 14, 2020, Seaboldt and co-defendants Destiny J. White, 34, of Blue Springs, Mo., and Charles V. Bai, 29, of Independence, Mo., executed a scheme to steal the Camero. The victim of the carjacking, identified in court documents as “K.B.,” drove White in his Camaro to an alleyway in Kansas City, Mo. White told K.B. they were picking up Seaboldt because she was having an argument with her boyfriend. Seaboldt was on the phone with Bai, pretending to have an argument as K.B. and White stood by and waited.
Bai then walked into the alleyway, wielding a Glock .45-caliber semi-automatic handgun with an extended magazine. Bai pointed the firearm at K.B. and ordered him to get out of the Camaro. Bai then got into the Camaro and drove it away.
At approximately 2:20 a.m., law enforcement officers responded to a 911 call regarding the carjacking and contacted K.B. K.B. requested location information for his vehicle using OnStar. Bai later fled from officers in the stolen vehicle, which he ultimately wrecked.
Bai was sentenced on April 8, 2022, to 13 years in federal prison without parole. White was sentenced on Nov. 17, 2022, to three years and four months in federal prison without parole.
This case was prosecuted by Assistant U.S. Attorney Byron H. Black. It was investigated by the Independence, Mo., Police Department, the Kansas City, Mo., Police Department, the Federal Bureau of Investigation, the U.S. Marshals Service, and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Operation LeGend
Operation LeGend is a federal partnership with local law enforcement to address the increase in homicides and violent crime in Kansas City, Mo., in 2020. The operation honors the memory of four-year-old LeGend Taliferro, one of the youngest fatalities during a record-breaking year of homicides and shootings. Additional federal agents were assigned to the operation from the FBI, Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the U.S. Marshals Service.
Jury Finds Armed Home Invaders Guilty of Federal CrimesRead the Press Release
MIAMI – After a two-week trial, a South Florida federal jury found Kejuan Brandon Campbell, Antonio Charles James Jr., and Dionte Alexander-Wilcox guilty on one count of conspiracy to kidnap, two counts of kidnapping, three counts of bank robbery, and three counts of carrying a firearm during a crime of violence.
The evidence at trial revealed that on October 11, 2020, Campbell, James, and Alexander-Wilcox conspired to commit a home invasion against a husband and wife – both of whom were over 60 -- because the couple’s estranged nephew had stolen $20,000 from Campbell earlier that day. Wearing masks and gloves, and carrying firearms, the three defendants forced their way into the couple’s home, assaulted the husband, and forced both victims to lie on the floor by pointing guns at them.
The defendants ransacked the couples’ home and took their phones and a wallet. Using the wife’s telephone, the defendants tried using CashApp to transfer $20,000 themselves, but the transactions were declined. Campbell then forced the wife to travel with him to multiple stores to try to cash $20,000 in checks. The other two defendants kept the husband at home, holding him at gunpoint.
After the stores declined to process the checks, the defendants stayed overnight at the victims’ home and planned to get the money from the couple’s bank the next morning. During their stay, the defendants cooked, drank alcohol, and smoked marijuana. They kept a gun pointed at the couple inside and did not allow them to speak to one another. At one point, with gun in hand, Alexander-Wilcox forced the wife into a bedroom and raped her.
The next morning, Campbell forced the wife to withdraw $20,000 from ATMs. After returning the wife home, the defendants filled a couple of suitcases with the victims’ jewelry, as well as items on which the defendants might have left their DNA. The defendants threatened to kill the victims if they called the police, locked the victims in a bathroom, took their house key, and left with the cash.
U.S. District Judge James I. Cohn will sentence the defendants in Fort Lauderdale federal court on April 27, 2023, -- Campbell at 9:30 a.m., James at 10:00 a.m., and Alexander-Wilcox at 10:30 am. They each face between 15 years and life in federal prison.
U.S. Attorney Markenzy Lapointe for the Southern District of Florida, acting Special Agent in Charge Maged Behnam of the FBI Miami Field Office, and interim Chief of Police Jose Vargas of the Miramar Police Department, announced the guilty verdict.
FBI Miami and Miramar Police Department investigated the case, with assistance from the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), Davie Police Department, Broward Sheriff’s Office, and Lauderhill Police Department. Assistant United States Attorneys Ajay Alexander and Brooke Latta are prosecuting this case. Assistant U.S. Attorney Daren Grove is handling the asset forfeiture aspect of the case.
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 21-cr-60011.
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Iowa City Man Sentenced to Federal Prison for Child Pornography ChargesRead the Press Release
DAVENPORT, IA – An Iowa City man was sentenced on February 21, 2023, to 14 years in prison following his plea to two counts of receiving child pornography.
According to court documents, Luke Kenneth Beckner, age 21, utilized his cellphone and social media accounts to meet minor females and solicit pornography from them. Beckner traveled to meet at least two of the minors and engaged in sexual intercourse with them. After receiving pornographic images, Beckner distributed some of the images of two identified minors to another person. Following his prison term, Beckner was ordered to serve an eight-year term of supervised release.
United States Attorney Richard D. Westphal of the Southern District of Iowa made the announcement. This case was investigated by the Iowa City Police Department.
This case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa as part of the U.S. Department of Justice’s “Project Safe Childhood” initiative, which was started in 2006 as a nation-wide effort to combine law enforcement investigations and prosecutions, community action, and public awareness in order to reduce the incidence of sexual exploitation of children. Any persons having knowledge of a child being sexually abused are encouraged to call the Iowa Sexual Abuse Hotline at 1-800-284-7821.
Inmate at United States Penitentiary at Canaan Pleads Guilty to Assaulting Another Inmate with A Dangerous WeaponRead the Press Release
SCRANTON- The United States Attorney’s Office for the Middle District of Pennsylvania announced that Isiah Robinson, age 36, formerly of Maryland, and an inmate at the United States Penitentiary, Canaan, Pennsylvania, pleaded guilty on February 23, 2023, before U.S. District Court Judge Malachy E. Mannion, to the charge of assault with a dangerous weapon.
According to United States Attorney Gerard M. Karam, Robinson admitted to assaulting another inmate with a sharpened piece of metal commonly known as a “shank.” The charge stems from an incident in October 2020, at the institution, at which time Robinson stabbed another inmate twice. The victim inmate’s wounds were not life-threatening but required outpatient treatment at a hospital.
The investigation was conducted by the Federal Bureau of Investigation and the Bureau of Prisons Special Investigative Service. Assistant United States Attorney Robert J. O’Hara is prosecuting the case.
The maximum penalty under federal law for the charge is ten years of imprisonment, a term of supervised release following imprisonment, and a fine. A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
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Huntersville, N.C. Man Is Sentenced for Wire FraudRead the Press Release
CHARLOTTE, N.C. – U.S. Attorney Dena J. King announced today that Benjamin Padua Jr., 57, of Huntersville, N.C., was sentenced to 30 months in prison for embezzling hundreds of thousands of dollars from his employer following the company owner’s death. Padua was also ordered to serve three years under court supervision after he is released from prison and to pay $729,914.32 in restitution.
Michael C. Scherck, Acting Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, joins U.S. Attorney King in making today’s announcement.
According to filed documents and today’s sentencing hearing, from September 2019 to February 2021, Padua abused his senior finance position with his employer, identified in court documents as Trucking Company, and used falsified documents and improper accounting entries to embezzle hundreds of thousands of dollars. Court documents show that, following the Trucking Company owner’s death in October 2019, Padua forged the owner’s signature on a fake employment agreement Padua created and backdated to prior to the owner’s death. The fraudulent employment agreement purported to increase Padua’s compensation significantly through higher wages, bonuses, and life insurance benefits. After he created the fake employment agreement, Padua received substantial compensation from the Trucking Company, to which he was not entitled.
Padua previously pleaded guilty to wire fraud. He will be ordered to report to the federal Bureau of Prisons upon designation of a federal facility.
In making today’s announcement, U.S. Attorney King thanked the FBI in Charlotte for their investigation of the case.
Assistant United States Attorney Daniel Ryan, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.
High-Ranking Blood Gang Member Sentenced to More Than 17 Years for Armed Drug TraffickingRead the Press Release
ELIZABETH CITY, N.C. – Darrick Charles, 31, of Wilmington, was sentenced to 210 months in prison for drug trafficking and gun charges. According to law enforcement, Charles was a high-ranking member of the United Blood Nation in Wilmington. Charles was ultimately apprehended by U.S. Marshals in Leland following a high-speed chase.
“Putting a stop to this high-ranking gang member’s criminal conduct is a victory for the citizens of Eastern North Carolina,” said U.S. Attorney Michael Easley. “Charles recklessly led police a high-speed chase through a residential neighborhood, then fled with a stolen gun. Today’s sentence is a warning. You gamble with your life and your future when you deal in gangs, guns, and drugs.”
According to court documents, evidence presented in court, and other documents, between February 12, 2020, and June 2, 2020, law enforcement made five controlled purchases of heroin from Charles in Wilmington. During a sale on February 19, 2020, Charles possessed a 9mm handgun while he sold a confidential informant a quantity of heroin. On February 24, 2020, law enforcement also purchased a handgun from Charles, who said during the deal that the buyer did not have to worry about the gun being stolen because his girlfriend is able to purchase them legally. Charles is prohibited from possessing firearms because of a prior conviction for manufacturing, selling, distributing, or possessing a controlled substance within 1,000 feet of a school and possession with intent to distribute heroin.
On June 4, 2020, law enforcement served a search warrant at Charles’ residence in Brunswick County. Law enforcement found three firearms and materials used for the distribution of heroin. An arrest warrant was ordered by the court for his failure to comply with his conditions of release for the previous charges.
On April 4, 2021, U.S. Marshals located Charles operating a vehicle in Leland, NC and attempted to stop him. Charles refused to stop and fled, driving in excess of 95 miles per hour in a residential area until he stopped near a wooded area and fled on foot. Charles was apprehended by the Marshals following a foot chase. While fleeing, Charles threw down a quantity of heroin and a loaded, stolen handgun. During the course of the investigation, law enforcement uncovered that Charles had made trips to
New Jersey and Greensboro to pick up heroin to be distributed in Eastern North Carolina.
On July 6, 2022, Charles pled guilty to five counts of distribution of a quantity of heroin, possession with intent to distribute a quantity of heroin, two counts of possession of a firearm by a convicted felon and two counts of possession of a firearm during and in relation to a drug-trafficking crime.
This is part of “Operation Golfer,” which is part of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launders, 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.
Michael Easley, U.S. Attorney for the Eastern District of North Carolina made the announcement after sentencing by U.S. District Judge Terrence W. Boyle. The Bureau of Alcohol, Tobacco, Firearms and Explosives, the Drug Enforcement Administration, the U.S. Marshals Service, the Federal Bureau of Investigation, the Wilmington Police Department, and the New Hanover and Brunswick County Sheriffs’ Offices investigated the case. Assistant U.S. Attorneys Timothy Severo and Gabe Diaz prosecuted the case.
Related court documents and information can be found on the website of the U.S. District Court for the Eastern District of North Carolina or on PACER by searching for Case No. 7:21-cr-00120-BO-1.
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Hartford Man Sentenced to More Than 6 Years in Federal Prison for Distributing CocaineRead the Press Release
Vanessa Roberts Avery, United States Attorney for the District of Connecticut, announced that LUIS CARRASQUILLO, also known as “Cuchi,” 52, of Hartford, was sentenced today by U.S. District Judge Kari A. Dooley in Bridgeport to 78 months of imprisonment, followed by four years of supervised release, for trafficking cocaine.
According to court documents and statements made in court, this matter stems from a joint investigation led by the FBI and the Norwich, New London and Hartford Police Departments into a narcotics distribution network that stretched from southeastern Connecticut to the Hartford, New Britain and Waterbury areas. The investigation, which included court-authorized wiretaps, surveillance, search warrants, and seizures of cocaine and crack cocaine, revealed that Carrasquillo was acquiring large quantities of cocaine and selling the drug to other distributors, some of whom converted the cocaine to crack.
On March 17, 2020, law enforcement conducted a court-authorized search of Carrasquillo’s Adelaide Street residence and seized approximately three kilograms of cocaine and $71,340 in cash.
On June 30, 2020, a grand jury returned an indictment charging Carrasquillo and eight other individuals with offenses related to their involvement in this drug ring. Carrasquillo was arrested on July 1, 2020.
On June 9, 2022, Carrasquillo pleaded guilty to possession with intent to distribute 500 grams or more of cocaine. Carrasquillo, who is released on a $270,000 bond, is required to report to prison on April 6.
This is Carrasquillo’s second federal conviction for a cocaine trafficking-related offense.
This matter has been investigated by Federal Bureau of Investigation, and the Norwich, New London and Hartford Police Departments. The case is being prosecuted by Assistant U.S. Attorney Margaret M. Donovan 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.
Harnett County Drug Dealer Sentenced to 15 Years in PrisonRead the Press Release
RALEIGH, N.C. – A Harnett County man was sentenced to 180 months in prison for dealing methamphetamine. On October 6, 2022, Christopher Wayne McNeill pled guilty to the charges.
According to court documents and other information presented in court, a multi-agency investigation identified that Christopher Wayne McNeill, 49, was trafficking kilograms of methamphetamine in Harnett County. Law enforcement made four controlled purchases of methamphetamine involving McNeill. Through their investigation, law enforcement determined McNeill was supplying other distributors with methamphetamine.
McNeill pled guilty to conspiracy to distribute more than fifty grams of methamphetamine and distributing more than five grams of methamphetamine. He has previous felony convictions for assault with a deadly weapon (1994) and breaking and entering (2014) as well as a felony drug conviction (2021).
Michael Easley, U.S. Attorney for the Eastern District of North Carolina made the announcement after sentencing by U.S. District Judge James C. Dever III. The Bureau of Alcohol Tobacco and Firearms, Coats Police Department, Dunn Police Department, Harnett County Sherriff’s Department, and the State Bureau of Investigation investigated the case and Special Assistant U.S. Attorney Casey L. Peaden prosecuted the case.
Related court documents and information can be found on the website of the U.S. District Court for the Eastern District of North Carolina or on PACER by searching for Case No. 5:22-CR-174-1D.
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Georgia woman charged with stealing over $450,000 in government and retirement benefitsRead the Press Release
ATLANTA - Sandra D. Smith has been arraigned on federal charges of wire fraud and theft of government funds. The indictment alleges that Smith stole more than $450,000 in Social Security Administration (SSA) retirement benefits and New York State Local and Retirement System (NYSLRS) benefits intended for M.S., who died in 2006 and was no longer eligible to receive those funds.
“Smith allegedly stole money that taxpayers and government employees faithfully paid into these retirement systems and to which she was not entitled,” said U.S. Attorney Ryan K. Buchanan. “This joint investigative effort is another excellent example of how collaboration between federal and state investigative partners help to uncover benefits fraud.”
“For nearly 15 years, the beneficiary’s death was allegedly concealed by Smith so that she could illegally obtain Social Security benefits, which is a federal crime. These charges exemplify that my office will continue to pursue those who defraud the Social Security Administration,” said Gail S. Ennis, Inspector General for the SSA. “I thank the New York Office of the State Comptroller for investigating with us.”
“The defendant callously took advantage of her mother-in-law’s death to profit at the expense of New York’s retirement system and the Social Security Administration,” said New York State Comptroller Thomas P. DiNapoli, who is trustee of the New York State Common Retirement Fund. “She has now been brought to justice and we will seek full restitution. I thank U.S. Attorney Buchanan and the Social Security Administration Office of the Inspector General for their partnership on this matter.”
According to U.S. Attorney Buchanan, the charges, and other information presented in court: In approximately September 2005, M.S., Smith’s former mother-in-law, began receiving SSA and NYSLRS benefits directly deposited into a bank account that was solely in M.S.’s name. At the time of M.S.’s death in September 2006, Smith served as her caretaker and handled her finances. Smith had access to M.S.’s bank account as M.S.’s caretaker.
After M.S. died, neither Smith nor anyone else notified SSA or NYSLRS of M.S.’s passing. Nor did Smith close M.S.’s bank account. Instead, Smith kept M.S.’s bank account open into which SSA and NYSLRS continued to deposit funds until early 2021. Smith knew exactly when those monthly benefits were deposited, and each month she allegedly withdrew the funds from the account almost as soon as they were deposited.
In total, SSA deposited $194,351.00 and NYSLRS deposited $264,699.53 into the account. Smith, who was interviewed in connection with this investigation, admitted that she stole the money and that she knew that she was not entitled to the funds.
Sandra D. Smith, 49, of Morrow, Georgia, was arraigned before U.S. Magistrate Judge Justin S. Anand. Smith was charged with 20 counts of wire fraud in violation of Title 18, United States Code, Section 1343, and 10 counts of theft of government funds in violation of Title 18, United States Code, Section 641. Members of the public are reminded that the indictment only contains charges. The defendant is presumed innocent of the charges and it will be the government’s burden to prove the defendant’s guilt beyond a reasonable doubt at trial.
This case is being investigated by the Social Security Administration - Office of the Inspector General and New York Office of the State Comptroller.
Special Assistant U.S. Attorney Diane C. Schulman is prosecuting the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Fraudulent Firearm Purchases Lead to Federal Prison Sentences for Two Flint MenRead the Press Release
GRAND RAPIDS, MICHIGAN — U.S. Attorney Mark Totten today announced that Jonathan-Michael Brown, of Flint, Michigan was sentenced to serve 120 months in prison for illegally purchasing 62 firearms from federally licensed firearms dealers in Michigan and Ohio. U.S. District Court Judge Jane M. Beckering also imposed a restitution order of $28,047.88 for losses to the firearms dealers and two years of supervised release following his term of incarceration. Co-defendant Jalen Kenyatta Malik Jackson, also of Flint, was sentenced in January to 12 months and one day imprisonment, two years of supervised release, and restitution of $12,004.27. In imposing the sentence against Brown, Judge Beckering commented that Brown’s “spree of firearms purchases” through the fraud scheme “victimized many people.”
“Protecting our communities by holding individuals accountable for straw purchasing weapons and fraudulently acquiring firearms that flood our streets with illegal guns is a top priority for my office,” said U.S. Attorney Mark Totten. “We will continue working with the ATF and our law enforcement partners to target these types of schemes that put our communities at risk.”
According to court documents, Brown, age 24, and Jackson, age 25, illegally purchased 62 firearms (and attempted to purchase 19 additional firearms) from federally licensed firearms dealers using multiple fraudulent methods. Brown had previously been convicted of a felony offense and could not lawfully possess any firearms. Brown acquired firearms by posing as another person and using the driver’s license and credit card account number assigned to that person and others to purchase the weapons for resale. After Brown’s arrest by state authorities, he recruited Jackson to make false statements to gun dealers and acquire multiple firearms using credit card numbers assigned to other people to purchase those weapons to resell to others. As a result, the cost of the guns was passed on to others and Brown and Jackson transferred the firearms to others for profit.
Brown pleaded guilty to three federal crimes: making a false statement and aggravated identity theft in connection with the purchase of two firearms, and conspiracy to commit wire fraud for profiting from selling firearms that he and Jackson illegally purchased from firearms dealers. Jackson pleaded guilty to one count of making a false statement during the purchase of firearms.
“Illegally providing firearms to prohibited persons fuels violent criminals presenting a grave threat to our communities,” said, ATF Acting SAC Craig Kailimai. “The collaborative effort with the U.S. Attorney’s Office, our federal, State of Michigan, and local partners continues to remove illegally trafficked firearms and those individuals involved from our streets.”
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, Michigan State Police, Flint Police Department, Saginaw Township Police Department, and Canton Police Department also aided in the investigation. Assistant U.S. Attorney Clay M. West prosecuted the case.
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Former Police Officer Sentenced for Money LaunderingRead the Press Release
Georgia man will serve 59 months in prison for his role in conspiracy to obtain more than $1 million in COVID-19 relief funds
GRAND RAPIDS, MICHIGAN — United States Attorney Mark Totten today announced that former Georgia police officer Andre Jackson has been sentenced to 59 months in prison followed by three years of supervised release for attempting to launder $500,000 in fraudulently obtained COVID-19 relief funds. During sentencing, U.S. District Judge Jane M. Beckering noted that Jackson’s behavior is “gutsy. It’s greedy. It’s concerning.”
“Andre Jackson was a con artist who tried to exploit the COVID-19 pandemic for his own personal gain,” said U.S. Attorney Totten. “Anyone who tries to get rich quick by stealing money intended to help those in need should expect to be held fully accountable.”
Jackson is a former police officer from Clayton County, Georgia. In 2020, he introduced fellow Georgia resident James Williams to Jemar Mason and David Kurbanov, both residents of the Western District of Michigan. Williams helped Mason and Kurbanov prepare fraudulent applications for Paycheck Protection Program loans authorized by the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act. This Act was a federal law designed to provide emergency financial assistance to the millions of Americans who were suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of forgivable loans to small businesses through the Paycheck Protection Program (PPP), which was designed to provide small businesses with loans in order to keep employees on payroll. Jackson and his co-conspirators exploited the program to obtain approximately $1.495 million in fraud proceeds.
Afterwards, Jackson attempted to launder some of the proceeds by directing two of his confederates to wire $500,000 to an overseas bank account that Jackson selected. Investigators from the Drug Enforcement Administration detected the plot and the Internal Revenue Service took steps to freeze the bank accounts of the conspirators, ultimately recovering approximately $1.123 million of the fraud proceeds. Federal prosecutors in the Western District of Michigan brought charges against five codefendants, including Jackson, all of whom have now been convicted in connection with the scheme.
“Pandemic relief funds in the form of PPP loans were established to help legitimate businesses weather the economic crisis created by COVID-19.” said Charles Miller, Acting Special Agent in Charge of IRS Criminal Investigation, Detroit Field Office. “In concert with the U.S. Attorney’s Office and our federal law enforcement partners, IRS-CI will continue to track down individuals who attempt to exploit this federal relief program for their own personal greed and hold them accountable for their crimes.”
“Jackson and his co-defendants stole money from the Paycheck Protection Program, which was a critical lifeline for Michigan’s small businesses during the pandemic,” said James A. Tarasca, Special Agent in Charge of the FBI in Michigan. “It was a serious crime, and the FBI remains committed to working with our law enforcement partners to identify fraudsters like this defendant and hold them fully accountable for their crimes.”
The charges in this case were part of an Organized Crime and Drug Enforcement Task Force (OCDETF) investigation, dubbed Operation Cashout, by law enforcement officers in the Western District of Michigan and the Northern District of Georgia, including the Internal Revenue Service – Criminal Investigation, Drug Enforcement Administration, Federal Bureau of Investigation, United States Postal Inspection Service, United States Secret Service, Bureau of Alcohol, Tobacco, Firearms, and Explosives, Michigan State Police, Kent Area Narcotics Enforcement Team (KANET), and the Grand Rapids Police Department.
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. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
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Former Pharma Executive and Cousin Charged with Insider Trading of Kodak StockRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Michael J. Driscoll, the Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today the unsealing of an Indictment charging JAMES ANDREW STILES, a/k/a “Andrew Stiles,” and EDWARD GRAY STILES, a/k/a “Gray Stiles,” with multiple counts of securities fraud and conspiracy to commit both wire fraud and securities fraud in connection with a scheme to commit insider trading based on misappropriated information about potential government loans to be made to the Eastman Kodak Company to finance the production of COVID-19-releated pharmaceutical components. ANDREW STILES was arrested this morning in South Carolina, and GRAY STILES was arrested this morning in Virginia.
U.S. Attorney Damian Williams said: “By stealing confidential business information, Andrew Stiles allegedly betrayed the trust and confidence of his employer — a pharmaceutical company working to help the public at the height of the COVID-19 pandemic — and schemed with his cousin, Gray Stiles, to collectively make more than a million dollars of illegal profits. Today’s arrests show that this Office will continue to prosecute those who seek to profit at the expense of the integrity and fairness of our financial markets.”
FBI Assistant Director Michael J. Driscoll said: “As alleged, the defendants are the latest examples of criminal actors relying on material non-public information to trade securities for their own profit. When individuals motivated by greed illegally tip the scales in their favor, public confidence in the integrity of our financial markets is eroded. Investigating and holding accountable the perpetrators of these schemes remains a priority for the FBI.”
According to the allegations in the Indictment unsealed in Manhattan federal court:[1]
Between June and July 2020, ANDREW STILES conducted an insider trading scheme in which he misappropriated material, non-public information (“MNPI”) and used it to trade in the stock of the Eastman Kodak Company (“Kodak”) and further provided that MNPI to his cousin, GRAY STILES, so that GRAY would likewise trade on the MNPI.
During that time, ANDREW STILES was an executive at a company (“Company-1”) that was working with Kodak to collaborate on the production of chemicals for pharmaceutical manufacturing in connection with the COVID-19 pandemic. Company-1 was also assisting Kodak in its application for a significant government loan, which ultimately resulted in the news, on July 27, 2020, of a government “letter of interest” to provide Kodak with a loan of $765 million (the “LOI”). In the following days, Kodak stock rose substantially, at one point increasing to more than 2,500% above the closing price prior to the news of the LOI.
During June and July 2020, ANDREW STILES was kept apprised of Kodak’s efforts to obtain the government loan, and he both traded using that non-public information and passed that information to GRAY STILES. For example, on July 9, 2020, when Kodak had applied for a loan in the amount of $655 million, ANDREW STILES and GRAY STILES exchanged the following coded text messages:
GRAY: Any update on the film we sent off a few weeks ago to get developed
ANDREW: 600+. Maybe 2 weeks out
GRAY: I can live with that hahaha
Between June 2020, after ANDREW STILES learned about the potential loan to Kodak, and July 27, 2020, the date the LOI was first publicized, ANDREW STILES purchased more than 90,000 shares of Kodak stock, including multiple purchases the day before the LOI was scheduled to be announced. GRAY STILES purchased more than 30,000 shares, more than half of which were purchased the day prior to the scheduled announcement of the LOI. In fact, on July 27, 2020, ANDREW STILES texted GRAY STILES, “Tmw,” indicating the expected date of the announcement. Less than one minute later, GRAY STILES responded, “Hot damn.” Following that exchange, and before the news was announced, ANDREW and GRAY STILES each purchased more than 10,000 additional shares.
ANDREW and GRAY STILES each sold the entirety of their shares in the days and weeks after the announcement. ANDREW STILES realized profits of more than $500,000; GRAY STILES realized profits of more than $700,000.
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ANDREW STILES, 37, of South Carolina, and GRAY STILES, 37, of Virginia, are each charged with three counts of securities fraud, each of which carries a maximum sentence of 20 years in prison, and one count of conspiracy to commit wire fraud and securities fraud, which carries a maximum sentence of five years in prison.
The statutory maximum penalties in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge.
Mr. Williams praised the outstanding work of the FBI.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Alex Rossmiller, Nicolas Roos, and Allison Nichols are in charge of the prosecution.
The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth in this release constitute only allegations, and every fact described should be treated as an allegation.
Former Legislator Sentenced to Five Years and Three Months in Prison for Theft of Government Funds and Honest Services Wire FraudRead the Press Release
SAN JUAN, Puerto Rico – Today, former legislator Nestor Alonso-Vega was sentenced by United States District Court Chief Judge Raúl Arias Marxuach to serve 63 months in prison, announced United States Attorney W. Stephen Muldrow. On June 6, 2022, Alonso-Vega was found guilty of nine counts of Federal Funds Theft, Kickbacks, and Honest Services Wire Fraud.
According to court documents and evidence presented at trial, between April 2018 and September 2020, Nestor Alonso-Vega authorized several salary adjustments for his assistant. It was agreed that his assistant would kickback to Alonso-Vega half of the total amount of the pay raise, split between each pay day. The total loss for the House of Representatives was $81,500, of which defendant received more than $40,000.
It was further alleged that the assistant, who testified during the trial, used a variety of means to transfer the kickbacks to Alonso-Vega. For example, he used ATH Móvil, made withdrawals around the time he received his paycheck and paid Alonso-Vega in cash, and, at times, made payments to Alonso-Vega’s Home Depot account.
“We continue to see the results of our efforts fighting public corruption,” said U.S. Attorney Muldrow. “The citizens of Puerto Rico deserve that their dollars be put to good use and not to line the pockets of corrupt officials. We will continue to investigate and prosecute corrupt behavior wherever we find it.”
Assistant U.S. Attorney Scott Anderson prosecuted the case. The case was investigated by FBI Special Agent Juan Carlos López of the San Juan Field Office.
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Former Jackson Township Official Sentenced to Prison for EmbezzlementRead the Press Release
PITTSBURGH - A Florida resident has been sentenced in federal court to 100 days in prison, to be followed by three years of supervised release, plus restitution of $150,000 on her conviction of mail fraud, Acting United States Attorney Troy Rivetti announced today.
United States District Judge Robert J. Colville imposed the sentence on Linda Baun, 73, of Largo, FL 33770.
According to information presented to the court, Baun was formerly employed as the Secretary/Treasurer for Jackson Township, in Mercer County. Between 2011 and 2019, she embezzled at least $150,000 from the Township by making unauthorized ATM withdrawals and by charging personal purchases on Amazon to the Township’s debit card.
Prior to imposing sentence, Judge Colville stated that Baun committed a serious crime involving public corruption.
Assistant United States Attorney Stephen R. Kaufman prosecuted this case on behalf of the government.
Acting United States Attorney Rivetti commended the Federal Bureau of Investigation, Pennsylvania State Police and the Mercer County District Attorney’s Office for the investigation leading to the successful prosecution of Baun.
Former Assistant Chief of Staff of the U.S. Navy’s Seventh Fleet Sentenced to 30 Months in Prison in Massive Corruption ScandalRead the Press Release
SAN DIEGO – U.S. Navy Captain (Retired) Jesus Vasquez Cantu was sentenced today to 30 months in prison by a federal district judge in San Diego on charges that he received lavish bribes from foreign defense contractor Leonard Francis, who plied him with luxurious hotel stays, travel, and prostitutes. Cantu was also ordered to pay a criminal fine of $75,000 and restitution to the U.S. Navy in the amount of $100,000.
“Mr. Cantu entered a den of corruption and in the process repudiated his oath and betrayed the sacred trust placed in him by the American people,” said U.S. Attorney Randy Grossman. “The Department of Justice and our agency partners will never relent in our pursuit of justice for schemes that dishonor our armed forces.”
Grossman thanked the prosecution team and agency partners for their excellent work on this case.
In his plea agreement, Cantu acknowledged that Francis took him and others out for drinks and dinners at posh restaurants, nightclubs and karaoke bars and paid for lavish hotel rooms and the services of prostitutes on numerous occasions in 2012 and 2013, during which time Cantu was the deputy commander, MSC Far East in Singapore, in charge of logistical sustainment to Navy ships operating in the Seventh Fleet. Cantu admitted that in return for these luxuries, he provided proprietary U.S. Navy information to Francis, and that he used his power and influence to help Francis and his company, Glenn Defense Marine Asia, known as GDMA, in its ship husbanding business.
Cantu also admitted in his plea agreement that, in 2007, when he was the Assistant Chief of Staff for Logistics for the Commander of the U.S. Navy’s Seventh Fleet aboard the USS Blue Ridge, he and others participated in a bribery conspiracy with Francis. Cantu and other members of the conspiracy accepted an ongoing stream of bribes from Francis, and in exchange, Cantu was influenced in the performance of his official Navy responsibilities and acted in violation of his official Navy duties.
“Mr. Cantu's sentencing holds him accountable for crimes he committed while serving as a senior Naval officer. His unconscionable criminal activity profoundly dishonored his oath, and unquestionably failed to meet the exacting standards required of all U.S. military personnel,” said Kelly P. Mayo, the Director of the Department of Defense Office of Inspector General, Defense Criminal Investigative Service (DCIS). “DCIS and its investigative partners will continue their tireless efforts to bring to justice those who choose a similar illicit and dishonorable path regardless of tenure or position.”
“Mr. Cantu betrayed his oath to his country and abused his position with the Navy by accepting lavish gifts from GDMA, including hotel rooms, entertainment, alcohol, and the services of prostitutes, in exchange for divulging sensitive information that helped Leonard Francis defraud the United States,” said NCIS Director Omar Lopez. “NCIS and our law enforcement partners remain committed to fully investigating all allegations of conspiracy, bribery and corruption that threaten the integrity of the Department of the Navy.”
The case is being prosecuted by Assistant U.S. Attorneys Mark W. Pletcher, Valerie Chu, Michelle Wasserman, and David Chu of the U.S. Attorney’s Office for the Southern District of California.
DEFENDANT Case Number: 17-CR-2376
Captain (Retired) Jesus Vasquez Cantu Age 64 Silverdale, Washington
SUMMARY OF CHARGES
Conspiracy to Commit Bribery, in violation of 18 U.S.C. § 371
Maximum Penalty: Five years in prison, a $250,000 fine or twice the gross pecuniary gain or twice the gross pecuniary loss, whichever is greaterINVESTIGATING AGENCIES
Defense Criminal Investigative Service
Naval Criminal Investigative Service
Defense Contract Audit Agency
Felon admits illegal possession of firearm after offering to sell pistol, illegal switches for firearm conversionRead the Press Release
BILLINGS — A California man suspected of offering to sell an undercover agent a pistol and switches used to convert firearms from semiautomatic to fully automatic admitted to a firearm charge today, U. S. Attorney Jesse Laslovich said.
Drew Parker Seymour, 24, of Banning, California, pleaded guilty to an indictment charging him with prohibited person in possession of a firearm. Seymour faces a maximum of 10 years in prison, a $250,000 fine and three years of supervised release.
U.S. Magistrate Judge Timothy J. Cavan presided. A sentencing date will be set before U.S. District Judge Susan P. Watters. The court will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. Seymour was detained pending further proceedings.
The government alleged in court documents that Seymour has a felony conviction in California for illegally possessing a firearm. In March 2022 in Billings, the Bureau of Alcohol, Tobacco, Firearms and Explosives learned that a person online offered to sell an individual illegal Glock switches, which are used to convert firearms from semiautomatic to fully automatic. The seller was later identified as Seymour. An undercover agent began communicating with Seymour, who offered to sell the agent Glock switches and a .45 caliber pistol. Seymour sent pictures of both. Seymour later withdrew his offer to sell the Glock switches. The undercover agent agreed to meet Seymour to buy the pistol. Earlier that day, before the meeting occurred, drug task force agents detained Seymour and his girlfriend at a U.S. Post Office in Billings as the couple was attempting to pick up a package of fentanyl. Law enforcement searched the couple’s motel room and located a .45-caliber, semiautomatic pistol hidden under a mattress. The pistol looked to be identical to the firearm in the pictures Seymour had sent, and Seymour’s fingerprint was recovered on the magazine of the gun.
Assistant U.S. Attorney Benjamin D. Hargrove is prosecuting the case, which was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, Billings Police Department, U.S. Postal Service and Eastern Montana High Intensity Drug Trafficking Area Task Force.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
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Federal Indictment Charges Four Co-Conspirators for Scheme Involving Money Orders Stolen from Post OfficeRead the Press Release
CHARLOTTE, N.C. – U.S. Attorney Dena J. King announced that a federal grand jury in Charlotte has indicted four co-conspirators for a scheme involving stolen United States Postal Service (USPS) money orders.
Jeff Krafels, Special Agent in Charge of the United States Postal Service, Office of the Inspector General (USPS-OIG) for the Mid-Atlantic Area Field Office (MAAFO), which oversees Charlotte, joins U.S. Attorney King in making today’s announcement.
Ravenna Lee Dorsey, Jr., 33, of Charlotte, Jaren Jamar Hopkins-Benton, 28, of Charlotte, Gregory Jeremy Singleton, 27, of Charlotte, and Shawn Joanta Brooks, 40, of Shelby, North Carolina, are each charged with conspiracy to defraud the United States by possessing and passing forged and altered USPS money orders, and possession of stolen and fraudulently altered USPS money orders.
According to allegations in the indictment, between November 2020 and February 2023, the co-conspirators acquired approximately 2,500 blank USPS money orders stolen from a Charlotte area post office. The indictment alleges that the co-conspirators purchased and used legitimate USPS money orders as “templates” to generate falsified and forged USPS money orders, which they deposited into multiple bank accounts and credit union accounts, and then withdrew the cash proceeds before the financial institutions detected the fraud. As alleged in the indictment, the co-conspirators redeemed approximately 800 of the stolen USPS money orders, causing losses totaling more than $750,000.
The charges in the indictment are allegations. The defendants are innocent until proven guilty beyond reasonable doubt in a court of law.
The conspiracy charge and each count of possession of stolen and fraudulently altered USPS money orders carry a maximum penalty of five years in prison and a $250,00 fine per count. A federal district court judge will determine each defendant’s sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
In making today’s announcement, U.S. Attorney King thanked the USPS-OIG for their investigation of the case.
Assistant U.S. Attorney Kenneth Smith of the U.S. Attorney’s Office in Charlotte is prosecuting the case.
Fayetteville Man Sentenced to More Than 11 Years in Federal Prison for Drug TraffickingRead the Press Release
FAYETTEVILLE – A Fayetteville man was sentenced yesterday to 140 months in prison followed by three years of supervised release on one count of Possession with Intent to Distribute Methamphetamine. The Honorable Judge Timothy L. Brooks presided over the sentencing hearing in the United States District Court in Fayetteville.
According to court documents, on January 25, 2022, detectives with the 4th Judicial Drug Task Force were investigating Richard Heath Brown, age 46, for drug trafficking. During the investigation, detectives learned that Brown was in possession of methamphetamine and that he had an outstanding warrant for his arrest. After receiving information of Browns vehicle, detectives were able to locate it and arrest him. A search of the vehicle resulted in detectives locating a black bag that contained approximately 412 grams of suspected methamphetamine.
The suspected methamphetamine was sent to the Department of Homeland Security forensic laboratory for further analysis.
U.S. Attorney David Clay Fowlkes of the Western District of Arkansas made the announcement.
The 4th Judicial District Drug Task Force investigated the case.
Assistant U.S. Attorney Sydney Butler prosecuted the case.
Fayetteville Man Sentenced to 14 Years in Federal Prison for Drug TraffickingRead the Press Release
FAYETTEVILLE – A Fayetteville man was sentenced today to 168 months in prison followed by 3 years of supervised release on one count of Possession with Intent to Distribute Methamphetamine. The Honorable Judge Timothy L. Brooks presided over the sentencing hearing in the United States District Court in Fayetteville.
According to court documents, on May 25, 2022, detectives with the 4th Judicial District Drug Task Force (DTF) received information that Reginald Everette Counts, age 49, was selling methamphetamine in the Northwest Arkansas area. Detectives learned Counts was residing at a hotel in Fayetteville, Arkansas.
As part of their investigation, detectives checked Counts through ACIC/NCIC and confirmed he was a probationer with a valid search waiver on file. Detectives then conducted surveillance at the hotel parking lot While conducting surveillance, detectives made contact with Counts in the parking lot as he was getting on his scooter. Detectives identified themselves as law enforcement officers and they searched Counts pursuant to his warrantless search waiver.
During the search of Counts, detectives located a pouch hanging around his neck. The pouch contained a bag of methamphetamine weighing approximately 28.5 grams, clear baggies and a digital scale. In Counts' jean pocket, detectives located a glass smoking pipe and $1,570.00 in U.S. currency. A search of Counts hotel room resulted in detectives locating five individually packaged bags of methamphetamine with an approximate weight of 143.3 grams. On May 27, 2022, Counts was released from custody on bond. On May 29, 2022, he was encountered again with a distribution amount of methamphetamine on his person. Counts attempted to flee the arresting officer and during the course of the arrest the officer sustained a torn ACL.
The drugs were subsequently sent to the Homeland Security Investigations Crime Laboratory where they tested positive for methamphetamine.
U.S. Attorney David Clay Fowlkes of the Western District of Arkansas made the announcement.
The Fourth Judicial District Drug Task Force investigated the case.
Assistant U.S. Attorney David Harris prosecuted the case.
Farmington Man Sentenced to More Than 13 Years in Federal Prison for Drug TraffickingRead the Press Release
FAYETTEVILLE – A Farmington man was sentenced today to 162 months in prison followed by three years of supervised release on one count of Possession with Intent to Distribute Methamphetamine. The Honorable Judge Timothy L. Brooks presided over the sentencing hearing in the United States District Court in Fayetteville.
According to court documents, on February 15, 2022, an officer with the Farmington Police Department was dispatched to a report of a suspicious male carrying a backpack who matched the description of a recent theft suspect. The officer located the male and made contact. The male identified himself as Robert James Poindexter, age 39. When the officer reviewed Poindexter’s record, he showed to have a warrantless search waiver on file as a condition of being on probation.
The officer observed that Poindexter appeared to be intoxicated and asked Poindexter if he had anything illegal on him. Poindexter removed a pair of brass knuckles from his pocket and provided them to the officer. A search of Poindexter’s person and backpack resulted in officers locating approximately 248 grams of suspected methamphetamine in three separate baggies, a large bag of marijuana and drug paraphernalia.
The suspected methamphetamine was sent to the Department of Homeland Security forensic laboratory where it was tested and determined to be methamphetamine.
U.S. Attorney David Clay Fowlkes of the Western District of Arkansas made the announcement.
The Farmington Police Department and the 4th Judicial District Drug Task Force investigated the case.
Assistant U.S. Attorney Sydney Butler prosecuted the case.
Farley Man Pleads Guilty to Sexually Assaulting 3-Year-Old Victim to Produce, Distribute Child PornographyRead the Press Release
KANSAS CITY, Mo. – A Farley, Mo., man pleaded guilty in federal court today to sexually assaulting a 3-year-old victim to produce child pornography and distribute it to others through the Kik application.
Andrew J. McCardie, 36, pleaded guilty before U.S. District Judge Brian C. Wimes to two counts of producing child pornography and one count of distributing child pornography. McCardie remains in federal custody without bond pending his sentencing hearing, which has not yet been scheduled.
McCardie communicated with individuals through the Kik application beginning in January 2022, using a screen name to indicate he was willing and able to produce child pornography and distribute to other persons. McCardie produced 19 images and videos of child pornography involving a 3-year-old child victim on Feb. 11 and 12, 2022. Most of these were created live, meaning he was recording himself actively sexually abusing the child victim while communicating with other persons over Kik, and sending those images and videos to them during the abuse.
On March 5, 2022, McCardie created another live video during his sexual abuse of the child victim. McCardie didn’t know he was communicating with an undercover law enforcement officer through Kik. McCardie told the undercover officer he had been “doing these requests on Kik for a couple years now” and discussed how to sexually abuse a child. During this conversation, McCardie sent the undercover officer a screenshot of a chat he was having with the Kik user he produced the video for, in order to prove he had created the video live.
On March 6, 2022, law enforcement officers executed a search warrant at McCardie’s residence. The entry team attempted to take control of McCardie near the entrance of the residence but he resisted, initially holding a firearm as officers entered. McCardie was brought out into the yard, where he continued to resist before being handcuffed and placed under arrest. McCardie attempted to hide his iPhone in the bedroom closet, but officers found the phone and seized it in order to conduct a forensic investigation.
McCardie’s Kik account included 218 images and videos of child pornography. McCardie sent 58 separate videos and images of child pornography to other Kik users, and had received more than 200 images and videos of child pornography from other Kik users between Jan. 2 and March 7, 2022.
Under federal statutes, McCardie is subject to a mandatory minimum sentence of 15 years in federal prison without parole, up to a sentence of 80 years in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Kenneth W. Borgnino. It was investigated by the FBI.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Ex-Housing Authority Official Ordered to Pay Restitution for Federal Fraud CrimeRead the Press Release
CHARLESTON, W.Va. – Pamela McDaniel, 69, of Charleston, was ordered today to pay $17,543.92 in restitution and sentenced to five years of federal probation, including six months on home detention, for altering a postal money order and embezzling more than $28,000 from the Charleston-Kanawha Housing Authority (CKHA).
According to court documents and statements made in court, McDaniel had been employed by CKHA since 2006 and was serving as a housing manager in 2018. As a housing manager, McDaniel’s duties included collecting tenant rental payments and forwarding them to the CKHA accounts clerk. On January 10, 2018, McDaniel received a $235 postal money order from a CKHA tenant intended for rental payment. McDaniel admitted to adding her own name to the postal money order to make it appear as though McDaniel was the intended beneficiary of the payment. McDaniel deposited the postal money order into her personal checking account.
McDaniel further admitted that from 2007 to 2018, she used her position as a CKHA housing manager to embezzle $28,523.30. As part of this scheme, McDaniel altered money orders she received from tenants attempting to pay dues that they owed CKHA and deposited the altered money orders into her personal checking account. McDaniel offset some of the money she stole by repaying a portion of the embezzled funds.
United States Attorney Will Thompson made the announcement and commended the investigative work of the U.S. Department of Housing and Urban Development Office of Inspector General (HUD OIG) and the Federal Bureau of Investigation (FBI).
United States District Judge Joseph R. Goodwin imposed the sentence. Assistant United States Attorney Ryan Blackwell prosecuted the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 2:22-cr-157.
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Eight Members of Bronx Gangs “Sev Side” and “Third Side” Charged with Murder, Racketeering, and Related Violent OffensesRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Keechant L. Sewell, Commissioner of the New York City Police Department (“NYPD”), announced the unsealing today of an Indictment charging KEVIN PEREZ, a/k/a “Kay Flock,” a/k/a “Kay,” a/k/a “KK,” DEVON MASON, a/k/a “BJ,” ERVIN BEAMON, a/k/a “EJ,” NICHOLAS JOHNSON, a/k/a “Nick,” SEAN SMITH, a/k/a “Sticky,” and JOSSI CASTRO, a/k/a “Jesse,” with racketeering conspiracy and other crimes related to their membership in “Sev Side,” or “DOA,” a street gang based in the Bronx, New York. On January 26, 2023, a Superseding Indictment was unsealed charging ISZAYAH ROWSON, a/k/a “Zay Munna,” a/k/a “Zay,” and MICHAEL GANT, a/k/a “AP,” with racketeering conspiracy and other crimes related to their membership in “Third Side,” a street gang also based in the Bronx, New York, that was closely affiliated with Sev Side. PEREZ was also charged with the gang-related murder of Hwascar Hernandez, who was shot to death on December 16, 2021, in the Hamilton Heights section of Upper Manhattan. PEREZ, MASON, BEAMON, JOHNSON, ROWSON, and GANT were further charged with multiple other violent crimes in connection with the Sev Side and Third Side gangs, including attempted murder and assault with a dangerous weapon arising from seven shootings committed in the Bronx between June 2020 and February 2022. The Sev Side Indictment is assigned to United States District Judge Lewis J. Liman. The Third Side Indictment is assigned to United States District Judge Paul A. Engelmayer.
ROWSON and GANT are currently in federal custody in connection with the charges contained in the Third Side Superseding Indictment. MASON, JOHNSON, and CASTRO were arrested this morning in the Bronx and are expected to be presented later today before Magistrate Judge Valerie Figueredo. PEREZ, who was in state custody, has been transferred to federal custody and is also expected to be presented later today. SMITH and BEAMON are fugitives.
U.S. Attorney Damian Williams said: “Over a span of several years, the members of these gangs allegedly terrorized neighborhoods in the Bronx and Manhattan by killing and shooting other people. Through these charges, we will hold Sev Side and Third Side members responsible for plaguing our communities with gun violence.”
NYPD Commissioner Keechant L. Sewell said: “The deadly nexus of gangs and illegal guns in New York City is a grave threat to public safety in our city. Combatting this crisis is the NYPD’s top priority, and today’s indictments are another step toward ridding our streets of violence and fear. I want to thank the U.S. Attorney’s Office for the Southern District of New York and everyone else involved with this case who worked to make our city safer for all the people we serve.”
According to the allegations in the Sev Side Indictment and the Third Side Superseding Indictment and statements previously made on the record in this case and related matters:[1]
From at least 2019 to 2022, members of Sev Side and Third Side, two street gangs based in the 48th Precinct in the Bronx, New York, aligned with one another to terrorize their own and surrounding neighborhoods by committing indiscriminate shootings against members of rival street gangs. Members of the gangs also promoted the gangs and gun violence on social media and through music they created and promoted, which referenced real acts of violence.
For years, Sev Side and Third Side engaged in disputes with rival crews in the Bronx and in Manhattan, which resulted in numerous acts of violence, including the following:
- PEREZ murdered Hwascar Hernandez in broad daylight in Manhattan on December 16, 2021;
- PEREZ, GANT, and ROWSON shot at rival gang members on June 20, 2020;
- JOHNSON shot at a rival gang member on June 26, 2020;
- GANT shot at rival gang members on July 7, 2020;
- GANT shot at rival gang members on July 16, 2020;
- ROWSON shot at a rival gang member on December 13, 2020;
- PEREZ, MASON, and BEAMON shot at rival gang members on November 10, 2021; and
- MASON shot at a rival gang member and hit an innocent bystander on February 10, 2022.
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A chart containing the names of the defendants who were charged today and on January 26, 2023, and the charges and minimum and maximum penalties they face is attached. All of the defendants are residents of the Bronx, New York.
The statutory minimum and maximum penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendants would be determined by a judge.
Mr. Williams praised the outstanding investigative work of the NYPD and thanked the New York County District Attorney’s Office and the Bronx County District Attorney’s Office for their assistance.
This case is being handled by the Office’s Violent and Organized Crime Unit. Assistant U.S. Attorneys Elizabeth Espinosa, Jim Ligtenberg, and Ni Qian are in charge of the prosecution.
The charges contained in the Indictment and the Superseding Indictment are merely accusations and the defendants are presumed innocent unless and until proven guilty.
Defendant
Age
Charges
Minimum and Maximum Penalties
KEVIN PEREZ
19
Racketeering Conspiracy, Murder in Aid of Racketeering, Use of a Firearm Resulting in Death, Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering, Use of a Firearm for Attempted Murder and Assault with a Dangerous Weapon
Mandatory life in prison or death
DEVON MASON
24
Racketeering Conspiracy, Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering, Use of a Firearm for Attempted Murder and Assault with a Dangerous Weapon, Possession of a Firearm with Defaced Serial Number
Maximum of life in prison; mandatory minimum 20 years to run consecutive to any other sentence
ERVIN BEAMON
23
Racketeering Conspiracy, Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering, Use of a Firearm for Attempted Murder and Assault with a Dangerous Weapon
Maximum of life in prison; mandatory minimum 10 years to run consecutive to any other sentence
NICHOLAS JOHNSON
21
Racketeering Conspiracy, Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering, Use of a Firearm for Attempted Murder and Assault with a Dangerous Weapon
Maximum of life in prison; mandatory minimum 10 years to run consecutive to any other sentence
SEAN SMITH
32
Racketeering Conspiracy, Possession of a Firearm After a Felony Conviction
Maximum of 30 years in prison
JOSSI CASTRO
25
Racketeering Conspiracy
Maximum of 20 years in prison
ISZAYAH ROWSON
22
Racketeering Conspiracy, Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering, Use of a Firearm for Attempted Murder and Assault with a Dangerous Weapon; Transportation and Receipt of a Firearm While Under Felony Indictment
Maximum of life in prison; mandatory minimum 20 years to run consecutive to any other sentence
MICHAEL GANT
21
Racketeering Conspiracy, Attempted Murder and Assault with a Dangerous Weapon in Aid of Racketeering, Use of a Firearm for Attempted Murder and Assault with a Dangerous Weapon
Maximum of life in prison; mandatory minimum 20 years to run consecutive to any other sentence
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the Superseding Indictment and the description of the indictments set forth herein constitute only allegations, and every fact described should be treated as an allegation.
Delaware Woman Sentenced to 9 years in Federal Prison for Laundering Drug Proceeds over the Course of Eight YearsRead the Press Release
WILMINGTON, Del. – David C. Weiss, U.S. Attorney for the District of Delaware, announced that today Circuit Judge Stephanos Bibas, of the United States Court of Appeals for the Third Circuit, sitting by designation in the District of Delaware, sentenced Shakira Martinez to 9 years’ incarceration for money laundering, conspiracy to commit money laundering, and structuring bank transactions following a jury verdict in July of 2022. Martinez was convicted together with her husband, Omar Colon, who was previously sentenced to 45 years’ incarceration for money laundering and drug crimes. Colon was referred to in Court as one of the biggest cocaine traffickers in Delaware history.
According to court records and statements made in open court, between 2009 and 2017, Martinez and Colon laundered nearly a million dollars in drug proceeds through the purchase of real estate properties in Delaware and Pennsylvania using their company, Zemi Property Management. They deposited drug money into several different bank accounts – and asked their friends and family members to do the same – and then used those funds to buy cashier’s checks that funded the property purchases. As the government noted at the sentencing hearing, the success of Colon’s drug empire would not have been possible without Martinez’s money laundering and structuring crimes.
Colon was arrested on May 6, 2017, shortly after giving his cocaine supplier $382,045 in cash in a hotel parking lot in Newark, Delaware. The Drug Enforcement Administration (“DEA”) subsequently discovered a secret underground bunker beneath Colon and Martinez’s residence, accessed by a tunnel behind a false fireplace, in which Colon hid a marijuana grow operation.
Before imposing sentence, Circuit Judge Bibas noted the seriousness of Martinez’s crimes, and said that money laundering is a “huge issue that fuels the drug trade with all its harms.” He further noted that the Court “needs to send a message that money laundering is a serious crime.”
U.S. Attorney Weiss commented on the case: “Ms. Martinez has received a serious sentence consistent with her central role in Colon’s drug empire. As Circuit Judge Bibas acknowledged in his remarks, drug trafficking wreaks havoc on the community and on families. Mr. Colon imported massive amounts of cocaine into Delaware for many years. The only way for Mr. Colon and Ms. Martinez to reap the fruits of Colon’s drug crimes and amass a real estate empire was through their money laundering scheme.”
“Martinez’s money laundering and structuring activities were the fuel that allowed her husband Colon to continue to purchase cocaine in furtherance of his drug-trafficking activities,” said Thomas Hodnett, Special Agent in Charge of the Drug Enforcement Administration’s (DEA) Philadelphia Field Division. “We applaud the sentence that Judge Bibas’ imposed on Martinez and his declaration of money laundering as the serious crime that it is.”
Special Agent in Charge Yury Kruty said “IRS Criminal Investigation special agents are uniquely qualified to follow complex financial transactions and uncover the source of the illegal funds. Martinez and Colon employed multiple tactics to clean up their ill-gotten gains, but in the end, they could not outsmart the government. The sentence handed down today is a stark reminder of the fate of those who engage in money laundering schemes.”
Assistant U.S. Attorneys Jennifer K. Welsh and Meredith C. Ruggles prosecuted the case. This case was investigated by the DEA Philadelphia Division and the Internal Revenue Service, Criminal Investigations.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the District of Delaware. Related court documents and information is located on the website of the District Court for the District of Delaware or on PACER by searching for Case No. 1:17-cr-00047-LPS.