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13 September 2022
Readout of Justice Department Leadership Meeting with Public Defender and Legal Aid Community LeadersRead the Press Release
On Monday, Sept. 12, 2022, Justice Department leadership met with leaders from the criminal public defender and civil legal aid communities in two separate events, coordinated by the Office for Access to Justice, to discuss access to justice, the right to counsel, and expanding legal assistance in both the criminal and civil legal systems. This represents the first time in over five years that the Department has hosted leadership from these public defender communities, and the first time in over a decade that all of the Executive Directors of the legal aid organizations funded by the Legal Services Corporation had the opportunity to gather together in person.
“The legitimacy of the law depends on equal justice,” said Attorney General Merrick B. Garland. “But equal justice depends on equal access to justice. And equal access, in turn, depends on the thousands of professionals who do the difficult and demanding work of providing legal services to those in need.”
On Monday afternoon, Associate Attorney General Vanita Gupta, Assistant Attorney General Kristen Clarke for the Civil Rights Division, Office for Access to Justice Director Rachel Rossi, Office of Justice Programs Principal Deputy Assistant Attorney General Amy Solomon and other Department staff met with the National Legal Aid and Defender Association, the American Council of Chief Defenders, the Black Public Defender Association, the Gault Center, the National Association for Public Defense, and the National Association of Criminal Defense Lawyers. The groups discussed a broad set of issues, including the need for data and research, the challenges of retention and recruitment, and the upcoming 60th anniversary of Gideon v. Wainwright, the landmark case establishing a constitutional right to counsel in criminal proceedings. Justice Department officials highlighted the important role of public defenders in protecting constitutional rights.
“In some places, we know there is a constructive denial of the right to counsel because defender systems are simply under-resourced,” said Associate Attorney General Gupta. “The tragic impact of COVID across our court systems has uniquely exacerbated these issues for public defense offices.”
Attorney General Garland, Associate Attorney General Gupta, and Director Rossi later spoke to the Executive Directors of over 100 legal aid organizations at a reception that also included leadership from the Legal Services Corporation. The event was an opportunity for the civil legal aid community to gather with Department leadership and staff in recognition of the vital role that legal services play in our democracy.
Pittsburgh Felon, 21, Sentenced to 5 Years in Prison for Illegally Possessing GunsRead the Press Release
PITTSBURGH - A former resident of Pittsburgh, Pennsylvania, has been sentenced in federal court to 60 months of imprisonment on his conviction of two counts of possession of a firearm by a convicted felon, United States Attorney Cindy K. Chung announced today.
United States District Judge Robert J. Colville imposed the sentence on Jerimyah Newton, age 21.
According to information presented to the court, the defendant ran over a Pittsburgh Bureau of Police officer’s foot while speeding away from a traffic stop on April 10, 2020. After a vehicle pursuit, officers found the vehicle, which was now unoccupied, and seized a loaded handgun from under the driver’s seat. Those same officers encountered the defendant on May 31, 2020, and seized a loaded handgun equipped with an extended magazine from the defendant’s waistband after a brief foot chase.
Assistant United States Attorney Jonathan D. Lusty prosecuted this case on behalf of the government.
/United States Attorney Chung commended the Drug Enforcement Administration and Pittsburgh Bureau of Police for the investigation leading to the successful prosecution of Newton.
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.
Pinellas County Man Charged with Wire and Bank Fraud OffensesRead the Press Release
Tampa, FL – United States Attorney Roger B. Handberg announces the unsealing of an indictment charging James John Melis (52, Largo) with four counts of wire fraud, two counts of bank fraud, and three counts of aggravated identity theft. If convicted, Melis faces a maximum penalty of 20 years in federal prison for each wire fraud count, 30 years for each bank fraud count, and a consecutive mandatory penalty of 2 years’ imprisonment for the aggravated identity theft counts. The indictment also notifies Melis that the United States is seeking an order of forfeiture in the amount of $1.1 million, the proceeds of the charged criminal conduct.
According to the indictment, Melis abused his position as business manager at a private school in Tampa by attaching his personal bank account to the school’s PayPal account without authorization. When parents made tuition payments to the school’s account, Melis initiated fraudulent electronic funds transfers to his personal account. He then spent the stolen funds on travel and luxury items, such as jewelry.
Separately, the indictment charges Melis with carrying out a mortgage origination fraud scheme against a financial institution for two properties he owned. To deceive the mortgage lender into believing he was a qualified borrower, Melis used the personal identification information of another person on loan applications, and prepared and submitted false and fraudulent IRS income tax returns, fictitious satisfactions of mortgages falsely representing that his properties had equity, and lease agreements falsely showing he received substantial rental income. As part of this scheme, Melis used the means of identification of other individuals and forged their signatures on the fictitious satisfactions of mortgage and phony lease agreements submitted to the mortgage lender. Based on Melis’ misrepresentations, the financial institution approved and funded both mortgage loans.
An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the Federal Housing Finance Agency – Office of Inspector General and the Federal Bureau of Investigation. It will be prosecuted by Special Assistant United States Attorney Chris Poor.
Owner of District of Columbia Real Estate Company Pleads Guilty to Federal Bribery ChargeRead the Press Release
WASHINGTON – Frederick Silvers, 57, of Washington, D.C., owner of Silvers Realty Management LLC, pleaded guilty today to a federal bribery charge, admitting that he paid a District of Columbia government employee in return for confidential information.
The announcement was made by U.S. Attorney Matthew M. Graves, Wayne A. Jacobs, Special Agent in Charge of the FBI Washington Field Office’s Criminal Division, and Daniel W. Lucas, Inspector General for the District of Columbia.
Silvers pleaded guilty in the U.S. District Court for the District of Columbia. The Honorable Colleen Kollar-Kotelly scheduled sentencing for Feb. 10, 2023.
According to court papers, from July 2016 through June 2018, Silvers admitted to giving more than $2,000 in bribes to a program specialist with the D.C. Department of Housing and Community Development in exchange for confidential, un-redacted Tenant Opportunity to Purchase Act (TOPA) offer of sale notices. TOPA provides tenants living in the District of Columbia with the right to purchase their residence should the owner decide to sell the property. Under TOPA, tenants are allowed to re-assign their right to purchase to a third party. TOPA requires the owner (seller) to provide the District of Columbia Department of Housing and Community Development with offer of sale notices before the proposed real estate transaction. The offer of sale notices include, among other things, information not released to the public, such as the names of tenants residing at the property.
The D.C. government employee, Dawne Dorsey, 40, pleaded guilty in June 2019 to a federal bribery charge for related conduct.
This case is being investigated by FBI’s Washington Field Office and the D.C. Office of Inspector General. The case is being prosecuted by Assistant U.S. Attorney Elizabeth Aloi of the Fraud, Public Corruption, and Civil Rights Section of the U.S. Attorney’s Office for the District of Columbia.
Over $642,000 from Forfeited Property to Aid Victims of TerrorismRead the Press Release
BOSTON – U.S. Attorney Rachael Rollins announced today that $642,702 from the civil forfeiture of a Waltham home of two fugitives has been approved for deposit to the United States Victims of State Sponsored Terrorism Fund, which provides compensation to United States persons injured in acts of international state-sponsored terrorism.
The $642,702 was recovered through a civil forfeiture action against the former residence and business location of Anni Beurklian, a/k/a Anni Ajaka (Beurklian) and her husband, Antoine Ajaka, a/k/a Tony Ajaka (Ajaka). The couple was previously indicted in connection with a scheme to smuggle goods out of the United States and to supply services to Syria. While engaged in plea negotiations with the United States government, Beurklian and Ajaka fled the United States in 2018 to avoid prosecution, and are believed to be outside the United States, namely in Syria or Lebanon.
In 2020, the United States filed a civil forfeiture action against the couple’s Waltham residence, alleging that from 2014 and continuing until the couple fled the United States, Beurklian and Ajaka operated an export business, Top Tech U.S. Inc., from the Waltham home. The couple used the property home to procure goods, including electronics, computer equipment and electrical switches, from United States companies and from that home, exported those goods to various countries, including Lebanon, Egypt and China, in violation of federal law.
One of their customers was Amir Katranji (Katranji), a citizen of Syria who operates and manages EKT. In 2007, EKT and its founder, Mohammad Katranji, Amir Katranji’s father, were added to the Department of Commerce’s Entity List because the United States government had determined that EKT and Mohammad Katranji were involved in activities related to the acquisition, attempted acquisition and/or development of improvised explosive devices, which were being used against United States and Coalition troops in Iraq and Afghanistan. Title 19 of the United States Code provides that property used to facilitate the exporting or sending of merchandise from the United States contrary to law shall be seized and forfeited to the United States.
Although the couple had not returned to the United States, they filed a claim to maintain ownership of the home. In May 2021, United States Judge Leo T. Sorokin denied the claim under the fugitive disentitlement statute, which allows the court to deny a claim in a civil forfeiture action from a person who is avoiding criminal prosecution in the United States.
Homeland Security Investigations sold the Waltham home for a net recovery of over $856,000 and applied to have seventy-five percent of the net proceeds, or approximately $642,702, be used to pay eligible victims of state sponsored terrorism. That request was approved by the Money Laundering and Asset Recovery Section of the Department of Justice this August, resulting in these funds being deposited in the United States Victims of State Sponsored Terrorism Fund.
In July of 2018, the U.S. Department of the Treasury designated EKT, Katranji, Beurklian and Ajaka as Weapons of Mass Destruction Proliferators pursuant to Executive Order 13382. Accordingly, it is illegal for any U.S. person to do business with them. These designations and sanctions were imposed against EKT, Katranji, Beurklian and Ajaka in coordination with similar actions by the French government based upon evidence that EKT was involved in the development of chemical weapons used by the Syrian Government.
United States Attorney Rachael S. Rollins; Matthew Millhollin, Special Agent in Charge of the Homeland Security Investigation, Boston Field Office; and Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division made the announcement today. The civil forfeiture action was handled by Assistant U.S. Attorney Carol E. Head, Chief of Rollins’ Asset Recovery Unit.
Omaha Man Sentenced to Five Years for Possessing Child PornographyRead the Press Release
Acting United States Attorney Steven Russell announced that Paul Piskorski, 53, of Omaha, Nebraska, was sentenced on September 12, 2022, in federal court in Omaha for possessing child pornography. Senior United States District Judge Joseph F. Bataillon sentenced Piskorski to five years of imprisonment. There is no parole in the federal system. After completing his term of imprisonment, Piskorski will begin a 5-year term of supervised release.
On May 28, 2018, Piskorski uploaded an image of child pornography to Microsoft Bing’s search function. On September 16, 2019, law enforcement agents executed a search warrant at Piskorski’s Omaha residence. Agents located approximately 300 images of child pornography saved on his computer, including the image he uploaded to Microsoft Bing.
This case was investigated by the Federal Bureau of Investigation and was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Nixa Physician Sentenced after Taking Bribes from Drug ManufacturerRead the Press Release
SPRINGFIELD, Mo. – A Nixa, Mo., physician was sentenced in federal court today after taking bribes from a drug manufacturer in exchange for prescribing its fentanyl drug to his patients so often that he ranked highest in the state in net sales of the product.
Randall Halley, 65, was sentenced by U.S. District Judge Stephen R. Bough to one year and one day in federal prison without parole. The court also ordered Halley to pay $400,565 in restitution to Medicare and to pay a fine of $150,000.
On Dec. 7, 2021, Halley pleaded guilty to one count of making a false statement to Medicare to obtain insurance coverage for a fentanyl prescription and to one count of conspiracy to use his DEA registration number for his employees to issue Schedule II controlled substances to patients in his absence.
Halley, a licensed physician, was employed by Ozark Community Hospital - Christian County Clinic in Nixa from 2004 to June 2019. He also was employed by several area skilled nursing facilities and residential care facilities.
According to court documents, Halley was only present at the Nixa practice, at most, two days of each week, as he was paid to provide care at several area nursing homes and regularly accepted additional money to travel and speak on behalf of pharmaceutical companies. One of the pharmaceutical companies he agreed to speak for was Insys, which produced a fentanyl medication, Subsys, that Medicare only approved for active cancer patients who were currently suffering from breakthrough cancer pain.
Halley accepted bribes from Insys in exchange for prescribing Subsys to his patients. Halley’s participation in Insys’s speakers program was a front designed to conceal the bribes Insys paid to Halley and other doctors. As long as Halley continued to prescribe Subsys, to increasing numbers of patients and in increasing dosages, Insys paid him to speak for them, increasing his compensation over time due to his prescriptions. There was a direct correlation between Insys’s payments to Halley and his issued Subsys prescriptions.
Halley had the highest net sales of Subsys of any physician in the state of Missouri and ranked 38th in the United States at one time. Altogether, Insys paid Halley $92,225 in bribes during their relationship.
The sham nature of this program was exhibited by the fact that Insys paid him for a program he never attended and labeled him as a “National” speaker at a higher payment rate despite the fact he only twice traveled outside the state of Missouri to speak for Insys, to neighboring Arkansas and Illinois. After the program Halley did not attend, he signed a sheet affirming that he attended and spoke at the program when, in fact, he had not. This led to Insys paying him $2,400 for the program.
Halley made false statements on pre-approval forms to ensure Medicare coverage of the expensive drug for these patients.
Halley also conspired with his employees at the clinic to use his registration number so they could provide prescription medication in his absence. Despite Halley’s absence at his clinic on three days of the week, and sometimes more due to his Insys travel, he directed clinic employees to continue scheduling patient visits on those days. Some of these patient visits were conducted by employees of the clinic who could not legally prescribe Schedule II controlled substances. Halley directed them to write out prescriptions several days ahead of these office visits and he would pre-sign these prescriptions. Then, when the patient came into the clinic for their office visit, the employees would conduct the visit and issue the pre-signed prescriptions, all without Halley conducting an examination of the patient.
Former employees Nga A. Nguyen, 43, and Susan G. Morris, 64, both of Springfield, and Amber N. Moeschler, 39, of Ozark, Mo., have pleaded guilty and await sentencing for illegally using Halley’s DEA registration number in connection with the distribution of a controlled substance. Former employee Kimberly G. Hoffer, 50, awaits trial in December for related charges.
Halley disregarded the dangerousness of Subsys. Fentanyl is a highly addictive synthetic opioid that is up to 50 times stronger than heroin. It is a major contributor to fatal and nonfatal overdoses in the United States. The drug is so dangerous that all prescribers and patients who prescribe and receive Subsys must participate in the government-mandated Risk Evaluation and Mitigation Strategy program, involving education, the prescriber’s contractual commitment to mandatory prescribing rules, and compulsory patient disclosures.
Numerous patients received dangerous fentanyl medication they did not need, nor did they qualify for under Medicare, and Medicare was defrauded out of hundreds of thousands of dollars. In his plea agreement, Halley specifically admitted that he prescribed Subsys to a patient and submitted a request to Medicare for payment coverage of the prescription, falsely stating that the patient had a diagnosis of cancer. Halley knew that the patient did not have a diagnosis of cancer at that time, and was not being treated for breakthrough cancer-related pain – two conditions that Medicare required for payment coverage of Subsys. Due to Halley’s false statement, Medicare paid a total of $11,945 to cover the patient’s prescription and subsequent Subsys prescriptions. Halley committed similar conduct with additional payments, leading Medicare to pay hundreds of thousands of more dollars for Subsys prescriptions.
This case is being prosecuted by Assistant U.S. Attorneys Casey Clark and Nhan D. Nguyen. It was investigated by the Department of Health and Human Services, Office of Inspector General, the FBI, and the Drug Enforcement Administration.
Midlothian Woman Sentenced for $1.8 M COVID-19 Fraud Using Information Obtained from Her State EmploymentRead the Press Release
RICHMOND, Va. – A Midlothian woman was sentenced today to 70 months in prison for defrauding the Pandemic Unemployment Assistance (PUA) Program, the Paycheck Protection Program (PPP), and the Economic Injury Disaster Loan (EIDL) program, using victims’ personal identifying information that she obtained from her state government employment.
According to court documents, in the first of three fraud schemes, from May 2020 to August 2021, Sadie Mitchell, 30, with the assistance of her co-conspirator, executed a scheme to defraud the Virginia Employment Commission by filing at least 20 fraudulent unemployment applications using the personal identifying information of inmates. Among the false information included in these applications were false physical addresses, false last employers, and a false certification that the inmates were ready, willing, and able to work in the event employment became available. The conspirators further defrauded the Virginia Employment Commission by filing at least 30 fraudulent applications in the names of other individuals whose personal identifying information was obtained, in part, by Mitchell querying a government database she had access to as an employee of the Virginia Motor Vehicle Dealer Board. Through this fraud scheme, the conspirators obtained approximately $1 million in PUA and Unemployment Insurance benefits.
Additionally, from June 2020 to June 2021, Mitchell devised and executed a scheme to defraud the PPP and EIDL programs. The defendant submitted 5 PPP applications to a financial institution, each containing false statements, false representations, or false certifications. For instance, these applications contained false and fabricated gross figures and false certifications that the businesses were in operation on February 15, 2020. The defendant further executed a scheme to defraud the EIDL program, which was intended to give forgivable loans to small businesses. Mitchell submitted several fraudulent EIDL applications to the Small Business Administration for businesses that had no customers, employees, or business activity, and in those applications, she made false statements, representations, and false certifications.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia; Tira A. Hayward, Acting Inspector in Charge of the U.S. Postal Inspection Service’s Washington Division; Troy Springer, Acting Special Agent in Charge of the Washington, D.C. Regional Office, U.S. Department of Labor, Office of Inspector General; and Dr. Joseph V. Cuffari, Inspector General for the Department of Homeland Security, made the announcement after sentencing by U.S. District Judge Hannah M. Lauck.
Significant assistance was provided by the Virginia Department of Motor Vehicle, Virginia Employment Commission and the Virginia Department of Corrections.
Assistant U.S. Attorneys Kashan K. Pathan and Carla Jordan-Detamore prosecuted the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:22-cr-44.
Middleborough Man Indicted for Firearm OffenseRead the Press Release
BOSTON – A Middleborough man has been indicted by a federal grand jury in Boston in connection with his alleged theft and attempted sale of three firearms from FedEx packages he was responsible for delivering.
Frank P. O’Toole, 39, was indicted on two counts of possession or sale of a stolen firearm. O’Toole was previously arrested and charged by criminal complaint on Aug. 12, 2022.
According to the charging documents, O’Toole previously worked as a FedEx delivery truck driver out of a FedEx facility. It is alleged that, between October 2021 and June 2022, O’Toole stole three packages he was responsible for delivering, each containing a firearm intended for a Federal Firearms Licensee. On Aug. 9, 2022 and Aug. 12, 2022, O’Toole allegedly sold the three firearms to an undercover agent during two separate controlled purchases.
The charge of possession of a stolen firearm provides for a sentence of up to 10 years in prison, up to three years of supervised release and a fine of up to $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and statutes which govern the determination of a sentence in a criminal case.
United States Attorney Rachael S. Rollins; James M. Ferguson, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms & Explosives; and Middleborough Police Chief Joseph Perkins made the announcement today. Assistant U.S. Attorney Elianna J. Nuzum of Rollins’ Major Crimes Unit is prosecuting the case.
The details contained in the charging documents are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Martinsburg man sentenced for drug chargeRead the Press Release
MARTINSBURG, WEST VIRGINIA – Damian Lovett, of Martinsburg, West Virginia, was sentenced today to five years probation for a drug charge, United States Attorney William Ihlenfeld announced.
Lovett, 39, pleaded guilty in March 2022 to one count of “Conspiracy to Possess with Intent to Distribute and to Distribute Cocaine Base and Cocaine Hydrochloride.” Lovett admitted to working with others to distribute cocaine base, also known as “crack,” and cocaine hydrochloride, also known as “coke,” from November 2020 to March 2021 in Berkeley County and elsewhere.
Assistant U.S. Attorney Lara Omps-Botteicher prosecuted the case on behalf of the government. The FBI; the United States Marshals Service; the Department of Homeland Security; the Drug Enforcement Administration; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the West Virginia Air National Guard; the Eastern Panhandle Drug Task Force, a HIDTA-funded initiative; the West Virginia State Police; and the Washington County, Maryland, Narcotics Task Force investigated.
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
U.S. District Judge Gina M. Groh presided.
Man from Mescalero charged with sexual abuse by a repeat offenderRead the Press Release
ALBUQUERQUE, N.M. – Alexander M.M. Uballez, United States Attorney for the District of New Mexico, announced today that Darwin Neal Kinzhuma made an initial appearance in federal court on a criminal complaint charging him with sexual abuse in Indian Country and sexual abuse by a repeat offender. Kinzhuma, 57, of Mescalero, New Mexico, and an enrolled member of the Mescalero Apache Tribe, will remain in custody pending a preliminary and detention hearing scheduled for Sept. 16.
According to the complaint, on May 10, Kinzhuma allegedly gave a ride to the victim, identified as Jane Doe, on U.S. Highway 70. After stopping in Tularosa, New Mexico, to purchase alcohol, Kinzhuma took the victim to his home in Mescalero. Jane Doe, who is also an enrolled member of the Mescalero Apache Tribe, allegedly lost consciousness after drinking some of the alcohol provided by Kinzhuma. When the victim awoke, Kinzhuma allegedly was sexually assaulting her. The victim was unable to leave the home because she cannot see at night and Kinzhuma allegedly had taken the cane she needs to walk.
Kinzhuma is charged as a repeat offender due to a previous conviction for sexual abuse. On Dec. 21, 2017, Kinzhuma pleaded guilty to aggravated sexual abuse, admitting that on June 28, 2015, he sexually abused a victim on the Mescalero Apache Reservation. On May 22, 2017, Kinzhuma was sentenced to six years and nine months in prison followed by five years of supervised release.
A complaint is only an allegation. A defendant is presumed innocent unless and until proven guilty. If convicted, Kinzhuma faces up to life in prison and a lifetime of supervised release. Additionally, because the alleged offense was committed while Kinzhuma was on supervised release for a prior sexual assault, he faces up to five years in prison and up to a lifetime term of supervised release for a violation of the previously imposed supervised release.
The Bureau of Indian Affairs investigated this case. Assistant United States Attorney Matilda McCarthy Villalobos is prosecuting the case.
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Man Pleads Guilty to Fraud Scheme Targeting Navy ServicemembersRead the Press Release
NEWPORT NEWS, Va. – A Newport News man pleaded guilty today to conspiring to defraud Navy Federal Credit Union and its members out of money and property.
According to court documents, from approximately April to August 2021, Samari Smith, 20, conspired with at least four other people to commit credit union fraud by convincing account holders to withdraw and turnover funds to them under false pretenses. Smith and his coconspirators targeted sailors in the United States Navy on online dating applications like Tinder by posing as women interested in a romantic relationship. Smith and his co-conspirators asked the victimized Sailors to withdraw and turnover funds – often under the guise of helping a relative in the Navy who was trying to send them money.
Samari Smith was directly involved in defrauding four Sailors in the Navy who were then stationed in the Hampton Roads metropolitan area, which caused more than $40,000 in fraud losses to these victims. Two co-conspirators previously pleaded guilty, including the leader of the conspiracy, Trequan Smith, 21, of Hampton and Emani Burton, 23, also of Hampton. The broader fraud conspiracy orchestrated by Trequan Smith victimized dozens of Sailors in the Navy and caused hundreds of thousands of dollars of fraud loss.
Samari Smith pleaded guilty to conspiracy to commit bank fraud and is scheduled to be sentenced on January 27, 2023. He faces a maximum penalty of 30 years in prison. Trequan Smith pleaded guilty to conspiracy to commit bank fraud and aggravated identity theft. He faces a mandatory minimum of two years in prison and a maximum penalty of 32 years in prison. Burton pleaded guilty to conspiracy to commit bank fraud and was sentenced to a term of one day of incarceration and three years of supervised release.
Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia; Tira A. Hayward, Acting Inspector in Charge of the U.S. Postal Inspection Service’s Washington Division; and Frederick Franks, Special Agent in Charge of the Naval Criminal Investigative Service (NCIS) Norfolk Field Office, made the announcement after U.S. District Judge Arenda Wright Allen accepted the plea.
This case was investigated under the leadership and coordination of the Newport News Financial Crimes Task Force.
Assistant U.S. Attorney D. Mack Coleman is prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case Nos. 4:22-cr-56, 4:21-cr-67, and 4:21-cr-68.
Madison Man Sentenced to 110 Months for Methamphetamine TraffickingRead the Press Release
MADISON, WIS. – Timothy M. O’Shea, United States Attorney for the Western District of Wisconsin, announced that Derrick Shelton, 30, Madison, Wisconsin, was sentenced yesterday by U.S. District Judge James D. Peterson to 110 months in federal prison for distribution of 50 grams or more of methamphetamine. Shelton pleaded guilty to this charge on May 18, 2022.
On October 4, 2021, an undercover police officer communicated with Shelton and arranged to buy two ounces of methamphetamine from him. At a location in Madison, the undercover police officer met with Shelton and bought two ounces of methamphetamine in exchange for $800.
On October 19, 2021, the undercover police officer communicated with Shelton again and arranged to buy eight ounces of methamphetamine from him. At a location in Madison, the undercover police officer met with Shelton and bought eight ounces of methamphetamine in exchange for $2,600.
On November 10, 2021, agents executed a search warrant at Shelton’s residence in Madison and recovered heroin, methamphetamine, three firearms, and $15,882 in cash. At the time of the methamphetamine sales to the undercover police officer, Shelton was on extended supervision for armed robbery and burglary convictions in Dane County.
The charge against Shelton is the result of a joint investigation by the Drug Enforcement Administration, Dane County Narcotics Task Force, Wisconsin Department of Justice Division of Criminal Investigation, U.S. Postal Inspection Service, Federal Bureau of Investigation, and Sun Prairie Police Department. The investigation was conducted and funded by the Organized Crime Drug Enforcement Task Force (OCDETF), a multi-agency task force that coordinates long-term narcotics trafficking investigations. The prosecution of the case is being handled by Assistant U.S. Attorney Aaron Wegner.
Lowell Nurse Pleads Guilty in $100 Million Home Health Care Fraud and Kickback SchemeRead the Press Release
BOSTON – A Lowell woman has pleaded guilty in federal court in Boston in connection with a $100 million home health care fraud scheme.
Winnie Waruru, 42, of Lowell, pleaded guilty on Sept. 8, 2022 to one count of conspiracy to commit health care fraud; one count of health care fraud – aiding and abetting; one count of conspiracy to pay and receive kickbacks; two counts of making false statements; and one count of making a false statement in a health care matter. U.S. Senior District Court Judge George A. O’Toole Jr. scheduled sentencing for Jan. 12, 2023. Waruru was arrested and charged along with co-defendant Faith Newton in February 2021. Newton has pleaded not guilty and is pending trial.
According to the indictment, from January 2013 to January 2017, Newton was part owner and operator of Arbor Homecare Services LLC. Waruru was a Licensed Practical Nurse employed as a home health nurse at Arbor. Waruru and, allegedly, Newton engaged in a conspiracy to use Arbor to defraud MassHealth and Medicare of at least $100 million by committing health care fraud and paying kickbacks to induce referrals. Newton then allegedly laundered the ill-gotten gains.
Specifically, it is alleged that Arbor, through Newton and others, including Waruru, failed to train staff, billed for home health services that were never provided or were not medically necessary and billed for home health services that were not authorized. Arbor, through Newton and others, developed employment relationships as way to pay kickbacks for patient referrals, regardless of medical necessity requirements. They also allegedly entered sham employment relationships with patients’ family members to provide home health aide services that were not medically necessary and routinely billed for fictitious visits that did not occur. As alleged in the civil complaint, Newton either directly or through Arbor, targeted particularly vulnerable patients who were low-income, on disability and/or suffering from depression and/or addiction.
Waruru and Arbor billed MassHealth for Waruru’s skilled nursing visits, many of which she did not perform, were medically unnecessary, or were not approved by a physician. Waruru was personally responsible for causing Arbor to bill MassHealth for over $1.2 million in skilled nursing visits, much of which was fraudulent. Waruru also passed cash payments allegedly from Newton to two Arbor patients to retain those patients.
The charges of health care fraud, conspiracy to commit health care fraud, money laundering conspiracy and money laundering each provide for a sentence of up to 10 years in prison, three years of supervised release and a fine of up to $250,000 or twice the amount of the money involved in the laundering. The conspiracy to pay kickbacks, make false statements and make false statement in health care matter each provide for a sentence of up to five years in prison, three years of supervised release and a fine of up to $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and statutes which govern the determination of a sentence in a criminal case.
United States Attorney Rachael S. Rollins; Phillip M. Coyne, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General, Office of Investigations; Joleen D. Simpson, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; and Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division made the announcement. Assistant U.S. Attorneys Rachel Y. Hemani of Rollins’ Health Care Fraud Unit, David G. Tobin of Rollins’ Major Crimes Unite and Carol Head, Chief of Rollins’ Asset Recovery Unit are prosecuting the case.
The details contained in the court documents are allegations. The remaining defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Long Island Man Sentenced to More Than 16 Years in Prison for Heroin and Fentanyl Trafficking Related to Death of a 21-Year-Old Massapequa WomanRead the Press Release
Earlier today, at the federal courthouse in Central Islip, United States District Judge Gary R. Brown sentenced Donta Riddick to 198 months in prison for possessing and distributing heroin and fentanyl. As part of his guilty plea, Riddick also admitted to the distribution of heroin and fentanyl on September 13, 2020 that caused the death of a 21-year old woman from Massapequa, New York. Riddick pleaded guilty on January 28, 2022.
Breon Peace, United States Attorney for the Eastern District of New York, Frank A. Tarentino III, Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA), and Patrick J. Ryder, Commissioner, Nassau County Police Department (NCPD), announced the sentence.
“Today’s sentencing is justice served for the trauma that the defendant directly caused to our district, including the death of his young neighbor,” stated United States Attorney Peace. “This Office, together with our federal and local partners, works tirelessly to hold accountable those who deal deadly drugs and contribute to the opioid epidemic’s devastating impact on our communities.”
DEA Special Agent in Charge Frank Tarentino said, “Drug investigations like this underscore the devastating impact that every drug overdose and poisoning has on a family. Fentanyl is the deadliest drug to ever hit our streets and responsible for nearly 70% of nationwide drug-related deaths. DEA and our law enforcement partners are doubling down on defeating drug trafficking networks and bringing to justice those responsible for taking lives.”
“The sentencing of defendant Donta Riddick to 16.5 years in prison will hopefully bring some closure for the victim’s family, as this drug dealer will not be back on the streets of Nassau County. The defendant was found guilty of dealing drugs laced with fentanyl to our residents and caused the death of a 21-year-old female victim from Massapequa. Defendant Riddick infected our neighborhoods with these illegal drugs until his arrest, conviction and sentencing and I would like extend my appreciation to the investigators and their agencies for a job well done. The Nassau County Police Department is committed to enforcing all drug related crimes and will continue to offer assistance to those addicted to drugs,” stated Nassau County Police Department Commissioner Ryder.
According to court filings and statements made by the defendant at the guilty plea proceeding, on the night of September 13, 2020, Riddick sold fentanyl-laced heroin to the victim, who suffered a fatal overdose at a motel in Massapequa the following morning. A review of the victim’s cell phone by law enforcement revealed text messages she exchanged with Riddick in which she appeared to be ordering heroin from the defendant. On September 15, 2020, during the subsequent investigation by the DEA and NCPD, Riddick was arrested in possession of street-level quantities of the same fentanyl-laced heroin that had caused the death of the victim the day before.
At Riddick’s sentencing, the victim’s aunt spoke and described the traumatic impact of losing her niece to an overdose.
The government’s case is being handled by the Office’s Long Island Criminal Division. Assistant United States Attorneys Charles N. Rose and Samantha Alessi are in charge of the prosecution, with assistance from Paralegal Dejah Turla.
The Defendant:
DONTA RIDDICK
Age: 35
West Babylon, New YorkE.D.N.Y. Docket Nos. 20-CR-517 (S-1) (GRB)
Logansport Man Sentenced to 57 Months in PrisonRead the Press Release
SOUTH BEND – Bruce Johnson, 61 years old, of Logansport, Indiana, was sentenced by United States District Court Judge Damon R. Leichty on his plea of guilty to being a felon in possession of a firearm, announced United States Attorney Clifford D. Johnson.
Johnson was sentenced to 57 months in prison followed by 2 years of supervised release.
According to documents in this case, while Johnson was on parole, a compliance check resulted in the recovery of a firearm and methamphetamine from his residence. Johnson’s criminal history revealed that he is a convicted felon, and as such, is prohibited from possessing a firearm or ammunition.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives with the assistance of the Indiana State Parole and the Logansport Police Department. The case was prosecuted by Assistant United States Attorney Frank Schaffer.
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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Local man sent to prison for tax evasion and bankruptcy fraudRead the Press Release
HOUSTON – A man who evaded payment of his income taxes has been ordered to federal prison, announced U.S. Attorney Jennifer B. Lowery.
David Felt pleaded guilty May 9.
Today, U.S. District Judge Andrew Hanen ordered Felt to serve 18 months in federal prison. Judge Hanen also ordered Felt to pay $250,000 in restitution to the IRS.
According to the plea agreement filed in the record of the case, Felt admitted that he willfully evaded payment of income taxes he owed for 1986-87 and 1994-98.
He further admitted he received over $4 million in income during 2004-14, none of which was paid towards the owed taxes. Felt falsely stated he had no significant assets or income and had no ownership in any businesses.
In addition, he also admitted he acted as a disbursing agent for a debtor in a bankruptcy case. He testified in 2017 that he would not pay insiders from the estate of the debtor while the debtor paid creditors. However, as part of his plea, he admitted he filed monthly accounting reports for the debtor in 2019 containing payments to insiders, including himself, from the estate of the debtor.
Felt was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.
IRS - Criminal Investigation and the FBI conducted the investigation with the assistance of the U.S. Trustee's Office. Assistant U.S. Attorneys Quincy L. Ollison and Charles J. Escher prosecuted the case.
La Crosse Man Sentenced to 7 ½ Years for Distributing FentanylRead the Press Release
MADISON, WIS. – Timothy M. O’Shea, United States Attorney for the Western District of Wisconsin, announced that Antoine Hardie, 37, La Crosse, Wisconsin, was sentenced yesterday by Chief U.S. District Judge James D. Peterson to 7 ½ years in federal prison for distributing fentanyl. On May 17, 2022, Hardie pleaded guilty to possessing 40 or more grams of fentanyl with intent to distribute.
Hardie sold fentanyl to a confidential informant in La Crosse on five occasions between June 24, 2021 and September 17, 2021. A subsequent search of a storage shed associated with Hardie revealed 296 grams of fentanyl hidden in a child’s suitcase.
In selecting a 7 ½ year sentence, Judge Peterson noted the dangers of fentanyl, Hardie’s violent criminal history, and the need to protect the public. Hardie’s criminal history includes convictions for battery, witness intimidation, and burglary. In one case, he threatened to kill a victim and her family.
The charge against Hardie was the result of an investigation conducted by the Wisconsin Department of Justice Division of Criminal Investigation, La Crosse Police Department, and Holmen Police Department. Assistant U.S. Attorney Meredith Duchemin prosecuted this case.
Justice Department and Federal Trade Commission Hold Annual Trilateral Meeting with Enforcers from Mexico and CanadaRead the Press Release
Competition Enforcement Leaders: Canadian Commissioner of Competition Matthew Boswell; Federal Trade Commission Chair Lina Khan; Acting Chair Commissioner Brenda Hernandez of the Mexican Federal Economic Competition Commission; Assistant Attorney General Jonathan Kanter of Department of JusticeThe Justice Department’s Antitrust Division participated in a trilateral meeting today with enforcers from Mexico’s Federal Economic Competition Commission, Canada’s Competition Bureau, and the U.S. Federal Trade Commission. The meeting took place at FTC headquarters in Washington, D.C. and included roundtable discussions on current enforcement priorities and the current legal environment in each jurisdiction. Assistant Attorney General Jonathan Kanter led a conversation on merger enforcement, focusing on the digital economy and forthcoming revisions to the U.S. merger guidelines.
“Canada and Mexico are important partners for the United States in upholding antitrust laws and protecting North American workers and consumers,” said Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division. “As antitrust enforcement increasingly spans international borders, building a unified response is vital to meeting today’s market realities. Cooperation among neighboring agencies is a crucial step in this process.”
Federal Trade Commission Chair Lina Khan moderated a discussion of recent developments in the United States, Canada, and Mexico.
“Working closely with our North American neighbors is key for promoting fair, open, and competitive markets,” Federal Trade Commission Chair Lina Khan said. “Deepening collaboration and cooperation lets us strengthen our respective approaches to enforcement and better protect our citizens.”
This year’s meetings mark the first joint in-person gathering between the four agencies since 2019, after a pause due to the COVID-19 pandemic.
Justice Department Announces Nearly $225 Million in Grants to Support Coordinated Community Responses to Domestic and Sexual Violence on the 28th Anniversary of the Violence Against Women ActRead the Press Release
On the 28th anniversary of the original authorization of the Violence Against Women Act (VAWA), the Department of Justice announced $224.9 million in grants designed to enhance victim services and justice solutions for victims of sexual assault, domestic violence, dating violence, and stalking. Since the passage of VAWA, the United States has monumentally transformed the way communities and systems such as law enforcement, courts, prosecution, and service providers effectively address the needs of survivors. Funding, appropriated through VAWA and administered by the Office on Violence Against Women (OVW), has supported communities to implement policies and practices that protect and honor survivors.
“For nearly three decades, VAWA has enabled the Justice Department’s Office on Violence Against Women to provide essential support to help empower survivors, hold offenders accountable, and keep communities safe,” said Attorney General Merrick B. Garland. “The grants we are announcing today represent the Department’s renewed commitment to working alongside our partners across the country -- victim services providers, law enforcement agencies, prosecutors, courts, and community-based organizations -- to meet the crisis of gender-based violence with the urgency it demands.”
Grantees can use the grants to provide lifesaving services for hundreds of thousands of survivors each year, improve investigations and prosecutions, reach survivors in rural communities, and leverage the services of statewide coalitions charged with supporting local programs with trainings and service coordination.
- A total of $140,466,152 has been awarded across all 50 states and 6 territories under the STOP (Services, Training, Officers, and Prosecutors) Violence Against Women Formula Grants to develop and strengthen the criminal justice system’s response to violence against women and to enhance direct services for survivors.
- To address economic stability central to ending violence, 73 grants totaling $36,195,932 will provide housing and related wrap-around-services to survivors and their children under the Transitional Housing Program.
- OVW’s Rural Program awarded a total of $33,404,213 to support 44 projects uniquely designed to prevent and respond to these crimes in rural areas and promote safety and healing for survivors. The funding supports collaboration among victim advocates, law enforcement, prosecutors, court personnel, and community leaders to reach survivors and their families whose safety may be further jeopardized by geographical isolation.
- Eighty-seven grants totaling $14,887,922, awarded under the State and Territory Domestic Violence and Sexual Assault Coalitions Program, will support state and territorial coalitions to expand the capacity of local domestic violence and sexual assault programs, identify statewide gaps in services, and coordinate state, local, and territorial systems to address the needs of survivors.
“The grants announced today represent the Justice Department’s commitment to furthering the progress VAWA has achieved over the last three decades,” said Deputy Attorney General Lisa O. Monaco. “They help ensure that survivors who come forward to report abuse are met with competent and compassionate professionals who have the resources, training and institutional support to do their jobs.”
“Projects funded by the grants announced today build the community-wide partnerships that help break the cycle of violence using holistic and innovative approaches,” said Associate Attorney General Vanita Gupta. “An effective response to gender-based violence requires engagement by justice and healthcare professionals, victim advocates, culturally specific service providers, forensic scientists, and educators, among others. It takes all of us to bring about real change.”
“In communities throughout the country, VAWA has literally opened doors for millions of individuals and families who have suffered violence and needed somewhere safe to go,” said OVW Acting Director Allison Randall. “The grants issued today help keep those doors open and create new pathways to a life free of violence through innovative interventions that keep in step with the dynamic needs of survivors, especially for survivors from rural communities and historically underserved populations."
OVW provides leadership in developing the nation’s capacity to reduce violence through the implementation of VAWA and subsequent legislation. Created in 1995, OVW administers financial and technical assistance to communities across the country that are developing programs, policies, and practices aimed at ending domestic violence, dating violence, sexual assault, and stalking. In addition to overseeing federal grant programs, OVW undertakes initiatives in response to special needs identified by communities facing acute challenges. Learn more at www.justice.gov/ovw.
On the 28th anniversary of the original authorization of the Violence Against Women Act (VAWA) the Department of Justice announced $224.9 million in grants designed to enhance victim services and justice solutions for victims of sexual assault, domestic violence, dating violence, and stalking. Since the passage of VAWA, the United States has monumentally transformed the way communities and systems such as law enforcement, courts, prosecution, and service providers effectively address the needs of survivors. Funding, appropriated through VAWA and administered by the Office on Violence Against Women (OVW), has supported communities to implement policies and practices that protect and honor survivors.
“For nearly three decades, VAWA has enabled the Justice Department’s Office on Violence Against Women to provide essential support to help empower survivors, hold offenders accountable, and keep communities safe,” said Attorney General Merrick B. Garland. “The grants we are announcing today represent the Department’s renewed commitment to working alongside our partners across the country -- victim services providers, law enforcement agencies, prosecutors, courts, and community-based organizations -- to meet the crisis of gender-based violence with the urgency it demands.”
Grantees can use the grants to provide lifesaving services for hundreds of thousands of survivors each year, improve investigations and prosecutions, reach survivors in rural communities, and leverage the services of statewide coalitions charged with supporting local programs with trainings and service coordination.
- A total of $140,466,152 has been awarded across all 50 states and 6 territories under the STOP (Services, Training, Officers, and Prosecutors) Violence Against Women Formula Grants to develop and strengthen the criminal justice system’s response to violence against women and to enhance direct services for survivors.
- To address economic stability central to ending violence, 73 grants totaling $36,195,932 will provide housing and related wrap-around-services to survivors and their children under the Transitional Housing Program.
- OVW’s Rural Program awarded a total of $33,404,213 to support 44 projects uniquely designed to prevent and respond to these crimes in rural areas and promote safety and healing for survivors. The funding supports collaboration among victim advocates, law enforcement, prosecutors, court personnel, and community leaders to reach survivors and their families whose safety may be further jeopardized by geographical isolation.
- Eighty-seven grants totaling $14,887,922, awarded under the State and Territory Domestic Violence and Sexual Assault Coalitions Program, will support state and territorial coalitions to expand the capacity of local domestic violence and sexual assault programs, identify statewide gaps in services, and coordinate state, local, and territorial systems to address the needs of survivors.
“The grants announced today represent the Justice Department’s commitment to furthering the progress VAWA has achieved over the last three decades,” said Deputy Attorney General Lisa O. Monaco. “They help ensure that survivors who come forward to report abuse are met with competent and compassionate professionals who have the resources, training and institutional support to do their jobs.”
“Projects funded by the grants announced today build the community-wide partnerships that help break the cycle of violence using holistic and innovative approaches,” said Associate Attorney General Vanita Gupta. “An effective response to gender-based violence requires engagement by justice and healthcare professionals, victim advocates, culturally specific service providers, forensic scientists, and educators, among others. It takes all of us to bring about real change.”
“In communities throughout the country, VAWA has literally opened doors for millions of individuals and families who have suffered violence and needed somewhere safe to go,” said OVW Acting Director Allison Randall. “The grants issued today help keep those doors open and create new pathways to a life free of violence through innovative interventions that keep in step with the dynamic needs of survivors, especially for survivors from rural communities and historically underserved populations.
OVW provides leadership in developing the nation’s capacity to reduce violence through the implementation of VAWA and subsequent legislation. Created in 1995, OVW administers financial and technical assistance to communities across the country that are developing programs, policies, and practices aimed at ending domestic violence, dating violence, sexual assault, and stalking. In addition to overseeing federal grant programs, OVW undertakes initiatives in response to special needs identified by communities facing acute challenges. Learn more at www.justice.gov/ovw.
Jury Convicts Lancaster Man for International Drug Trafficking and Money LaunderingRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Dwayne Sherman, age 48, of Lancaster, Pennsylvania, was convicted yesterday by a federal jury on money laundering and drug trafficking conspiracy charges after a six-day trial before U.S. District Court Judge Jennifer P. Wilson.
According to United States Attorney Gerard M. Karam, the evidence introduced at trial showed that on three occasions between October 2015 and January 2016, Sherman delivered over $555,000 in cash to an informant working with the FBI. Each of the deliveries happened in Harrisburg, Pennsylvania. The money was transported to San Diego, California and then smuggled across the border into Tijuana, Mexico. During the years of the conspiracy, Sherman made numerous trips across the border into Mexico, including in late March 2016. In April 2016, police in Los Angeles, California, stopped Sherman’s vehicle and found him in possession of two kilograms of cocaine and 15,000 pills, some of which contained methamphetamine.
The case was investigated by the Internal Revenue Service Criminal Investigation, the Federal Bureau of Investigation, San Diego County Sheriff’s Office, the Hawthorne (California) Police Department, and U.S. Drug Enforcement Administration. Assistant U.S. Attorneys Michael A. Consiglio and Carl Marchioli prosecuted the case.
This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
The maximum penalty under federal law for this offense is 40 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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Jefferson County Man Pleads Guilty to Distributing MethamphetamineRead the Press Release
PITTSBURGH – A resident of Reynoldsville, Pennsylvania, pleaded guilty in federal court to violation of federal narcotics laws related to a nine-month Title III wiretap investigation into drug trafficking in and around the counties of Jefferson, Clearfield, and Allegheny, United States Attorney Cindy Chung announced today.
James Williams Jr., age 57, pleaded guilty to one count of conspiracy to distribute and possesses with intent to distribute 50 grams or more of a mixture and substance containing a detectable amount of methamphetamine before United States District Judge Christy Criswell Wiegand. Williams was one of 47 defendants charged in six related indictments as part of the Return to Sender investigation.
In connection with the guilty plea, the court was advised that Williams was a methamphetamine distributor who obtained between 350 grams and 500 grams of methamphetamine as part of a large-scale methamphetamine distribution conspiracy and redistributed it to methamphetamine users.
Judge Wiegand scheduled sentencing for Williams on Jan. 24, 2023, at 10:00 a.m. The law provides for a sentence of not less than five years to a maximum of forty years in prison, a fine not to exceed $5,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense(s) and the prior criminal history, if any, of the defendant.
The court ordered that the defendant remain on bond pending sentencing.
Assistant United States Attorneys Jonathan D. Lusty and Michael R. Ball are prosecuting this case on behalf of the government.
The Drug Enforcement Administration led the multi-agency investigation of this case, which also included the Homeland Security Investigations, United States Postal Service – Office of Inspector General, United States Postal Inspection Service, Internal Revenue Services, Pittsburgh Bureau of Police, Allegheny County Police, and Pennsylvania State Police. Also assisting were the Jefferson County District Attorney’s Office, Clearfield County District Attorney’s Office, and the Clarion Borough Police Department.
This prosecution is a result of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles high-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten communities throughout the United States. OCDETF uses a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
Iowa Man Pleads Guilty to Meth ConspiracyRead the Press Release
A man who conspired to distribute methamphetamine pleaded guilty on September 13, 2022, in federal court in Sioux City.
Dustin Coates, 36, from Cherokee, Iowa, was convicted of conspiracy to distribute methamphetamine. In 2013, Coates was previously convicted of distribution of a controlled substance in the United States District Court for South Dakota.
At the plea hearing, Coates admitted his involvement in a conspiracy that distributed at least 150 grams of pure methamphetamine from March 2021, through March 8, 2022. On March 8, 2022, law enforcement conducted a traffic stop of the vehicle Coates was driving. Coates threw two baggies of methamphetamine from his person while attempting to flee the traffic stop on foot. Coates admitted at the hearing that he planned to distribute the 60+ grams of methamphetamine to other persons.
Sentencing before United States District Court Chief Judge Leonard T. Strand will be set after a presentence report is prepared. Coates remains in custody of the United States Marshal pending sentencing. Due to his prior conviction for distribution of controlled substances, Coates faces a mandatory minimum sentence of 15 years’ imprisonment and a possible maximum sentence of life imprisonment, a $20,000,000 fine, and at least 10 years of supervised release following any imprisonment.
The case is being prosecuted by Assistant United States Attorney Kraig R. Hamit and was investigated by Tri-State Drug Task Force based in Sioux City, Iowa, that consists of law enforcement personnel from the Drug Enforcement Administration; Sioux City, Iowa, Police Department; Homeland Security Investigations; Woodbury County Sheriff’s Office; South Sioux City, Nebraska, Police Department; Nebraska State Patrol; Iowa National Guard; Iowa Division of Narcotics Enforcement; United States Marshals Service; South Dakota Division of Criminal Investigation; and Woodbury County Attorney’s Office.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 22-4027. Follow us on Twitter @USAO_NDIA.
Indiana man pleads guilty to illegally selling fireworks in OhioRead the Press Release
CINCINNATI – An Indiana man pleaded guilty in U.S. District Court here today to distributing explosive materials to a person without a permit or license.
A federal grand jury charged Paul Eberhard, 66, of Shelbyville, Indiana, in May 2021.
The investigation began after the July 4, 2020, death of a Mt. Healthy man. According to reports, the man died after being struck in the head by a display firework that he had purchased from Eberhard.
According to his plea documents, Eberhard admitted that he illegally sold display fireworks in 2020.
Display fireworks are large fireworks designed primarily to produce visible or audible effects by combustion, deflagration or detonation. Display fireworks contain more than 50 milligrams of flash powder for ground devices, and more than 130 milligrams of flash powder for aerial explosives. Under federal law, a person must have an ATF license or permit to receive or use display fireworks.
Eberhard had an ATF explosive permit. As part of maintaining his permit from 2008 until 2021, Eberhard repeatedly acknowledged that it was illegal for him to distribute explosive materials to anyone who is not an ATF explosives licensee or permittee. Despite this, Eberhard sold display fireworks to the man who died, who was neither an ATF explosives licensee or permittee.
Distributing explosive materials to a person without a permit or license is a federal crime punishable by up to 10 years in prison.
Kenneth L. Parker, United States Attorney for the Southern District of Ohio, and Daryl S. McCormick, Special Agent in Charge, U.S. Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF), announced the plea entered today before U.S. District Judge Matthew W. McFarland.
U.S. Attorney Parker and Special Agent in Charge McCormick commended the work of the Mount Healthy, North College Hill and Shelbyville police departments, the sheriff’s office bomb squads from Hamilton and Butler counties, and the Hamilton County Coroner.
Assistant United States Attorney Megan Gaffney Painter is representing the United States in this case.
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Honduran Man Sentenced to Prison for Illegally Reentering the United States After Being DeportedRead the Press Release
A man who illegally returned to the United States after being deported was sentenced today to three months in federal prison.
Santos Lara-Figueroa, age 43, a citizen of Honduras illegally present in the United States and residing in Hiawatha, Iowa, received the prison term today after a guilty plea on July 20, 2022, to one count of illegal reentry into the United States after having been deported.
At the guilty plea, Lara-Figueroa admitted he had previously been deported from the United States and illegally reentered the United States without the permission of the United States government. Lara-Figueroa, falsely claiming to be a Mexican citizen, was removed to Mexico by immigration officials in July 2006. One month later in August 2006, he illegally reentered the United States by crossing the border on foot into Texas. Lara-Figueroa was deported to Honduras from Virginia in January 2011. On February 22, 2022, immigration officials learned Lara-Figueroa had illegally returned to the United States and found Lara-Figueroa at the Linn County Jail following his arrest on state charges.
Lara-Figueroa was sentenced in Cedar Rapids by United States District Court Judge C.J. Williams. Lara-Figueroa was sentenced to 92 days’ imprisonment. He must also serve a one-year term of supervised release after the prison term. There is no parole in the federal system.
Lara-Figueroa is being held in the United States Marshal’s custody until he can be turned over to immigration officials.
The case was prosecuted by Assistant United States Attorney Daniel C. Tvedt and investigated by the Department of Homeland Security, Immigration and Customs Enforcement, Enforcement and Removal Operations.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 22-CR-52.
Follow us on Twitter @USAO_NDIA.
Homewood Drug Dealer Sentenced to 5 YearsRead the Press Release
PITTSBURGH - A resident of Pittsburgh, PA, has been sentenced to 60 months' imprisonment and four years of supervised release on charges of violating federal drug laws, United States Attorney Cindy K Chung announced today.
United States District Judge David S. Cercone imposed the sentence on Darwin Parker, age 27, formerly of the City’s Homewood South neighborhood.
According to information presented to the court, on January 13, 2021, detectives with the Pittsburgh Bureau of Police observed Parker conduct a hand-to-hand drug exchange with another person in the area of Frankstown Avenue and Nroth Homewood Avenue, in the Homewood section of the City of Pittsburgh. After Parker was taken into custody, detectives located two bags containing 33 grams of crack cocaine and 125 stamp bags containing a mixture of heroin and fentanyl, along with $1,240 in U.S. currency in Parker’s possession.
Assistant United States Attorney Michael R. Ball and Jonathan D. Lusty prosecuted this case on behalf of the government.
United States Attorney Chung commended the Pittsburgh Bureau of Police and the Drug Enforcement Administration for the investigation leading to the successful prosecution of Darwin Parker.
Harford County Felon Sentenced to 15 Years in Federal Prison for Sexual Exploitation of a Child and for Illegal Possession of a Firearm and AmmunitionRead the Press Release
Baltimore, Maryland – Yesterday U.S. District Judge George L. Russell, III sentenced Travis Joseph Crawford, age 34, of Edgewood, Maryland, to 15 years in federal prison, followed by 25 years of supervised release, for sexual exploitation of a child to produce child pornography and for being a felon in possession of a firearm and ammunition. Judge Russell also ordered that, upon his release from prison, Crawford will be required to register as a sex offender in the places where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
The sentence was announced by United States Attorney for the District of Maryland Erek L. Barron; Special Agent in Charge James C. Harris of Homeland Security Investigations (HSI) Baltimore; Special Agent in Charge Toni M. Crosby of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Baltimore Field Division; Harford County Sheriff Jeffrey R. Gahler; and Colonel Woodrow W. Jones III, Superintendent of the Maryland State Police.
According to Crawford’s plea agreement and other court documents, on November 30, 2020, Harford County Sheriff’s deputies went to Crawford’s residence, based on an arrest warrant issued for Crawford by Maryland State Police for firearms related offenses. When the officers arrived, they heard Crawford call, “Where’s my gun?” Crawford was arrested and law enforcement recovered a cell phone, a smart watch, and a fully-loaded .40-caliber semi-automatic pistol. A search warrant subsequently executed on Crawford’s phone revealed three sexually explicit videos involving Jane Doe, all of which were recorded without her knowledge or permission. Crawford was also previously a convicted felon and therefore was prohibited from possessing a firearm or ammunition.
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 Attorney’s 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.justice.gov/psc. For more information about Internet safety education, please visit www.justice.gov/psc and click on the “Resources” tab on the left of the page.
United States Attorney Erek L. Barron commended HSI, ATF, the Maryland State Police, and the Harford County Sheriff’s Office for their work in the investigation. Mr. Barron thanked Assistant U.S. Attorney Paul E. Budlow, who prosecuted the case.
For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit www.justice.gov/usao-md/project-safe-childhood and https://www.justice.gov/usao-md/community-outreach.
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Glock Boyz Gang Member Sentenced to 60 Months in Prison for Aggravated Identity Theft and Firearms OffensesRead the Press Release
Detroit – A member of the Glock Boyz street gang was sentenced to 60 months in prison today after being convicted of aggravated identity theft, wire fraud, and illegally possessing firearms, United States Attorney Dawn N. Ison Announced today.
Ison was joined in the announcement by Special Agent in Charge James A. Tarasca of the FBI’s Detroit Division.
According to court records, Damon Long, 25, of Detroit, was a member of a violent street gang, the “Glock Boyz TMC” (too much cash). The Glock Boyz have perpetrated acts of violence against rival gangs and have been victims of such violence. Court records tie Long to these violent attacks and to being the target of rival gangs.
In May 2021, the FBI executed a search warrant at Long’s residence in Detroit and seized two of Long’s loaded pistols. Agents also seized evidence that Long engaged in wire fraud by submitting false applications for federal Unemployment Insurance (UI) benefits using stolen identities totaling over $300,000. Long used the identities and Social Security numbers of at least ten individuals in perpetuating his scheme. Long boasted about his fraud schemes on social media, and his membership in the street gang was also revealed on his social media accounts.
In addition to 60 months in prison, Long was also ordered to pay restitution of $300,000.
The Detroit office of the FBI investigated this case with assistance from the Department of Labor. The case is being prosecuted by Assistant United States Attorneys assigned to the United States Attorney’s Office’s Violent & Organized Crime Unit.
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.
Georgia Man Indicted for Misuse of Social Security Number and Aggravated Identity TheftRead the Press Release
SYRACUSE, NEW YORK – Gregory William Hill, whose aliases include Gregory Allen Davis, Gregory William Davis, and John Martin Hill, age 37, of Georgia, has been charged by indictment with two counts of misuse of a social security number and two counts of aggravated identity theft. The indictment was announced by United States Attorney Carla B. Freedman and Janeen DiGuiseppi, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI).
The indictment alleges that Hill impersonated a former graduate of Syracuse University and used that victim’s name and a false social security number for the purpose of obtaining information and documentation from Syracuse University by fraud.
The charges filed against Hill carry a maximum sentence of 5 years in prison for the social security fraud counts and mandatory two-year terms of imprisonment for the aggravated identity theft counts; a fine of up to $250,000 for each count; and a term of supervised release of up to 3 years. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines and other factors.
The defendant was arraigned today by videoconference before United States Magistrate Judge Miroslav Lovric and has been ordered detained pending a trial to be scheduled before United States District Judge Glenn T. Suddaby.
The charges in the indictment are merely accusations. The defendant is presumed innocent unless and until proven guilty.
This case is being investigated by the FBI, and it is being prosecuted by Assistant U.S. Attorney Michael F. Perry.
Four Red River Army Depot Officials and Vendors Sentenced in Federal Bribery and Conspiracy SchemeRead the Press Release
TEXARKANA, Texas – Four individuals, including two Red River Army Depot (RRAD) officials, have been sentenced for federal violations in the Eastern District of Texas, announced U.S. Attorney Brit Featherston today.
Jeffrey Harrison, 44, of Texarkana, a former RRAD vendor, pleaded guilty on May 18, 2021, to bribing Jimmy Scarbrough, a former RRAD official, and was sentenced to 30 months in federal prison today by U.S. District Judge Robert W. Schroeder, III. Harrison was also ordered to forfeit $300,000.
Justin Bishop, 52, of Clarksville, a former RRAD vendor, pleaded guilty on May 18, 2021, to bribing Scarbrough and was sentenced to 12 months and 1 day in federal prison on Sep. 6, 2022, by Judge Schroeder. Bishop was also ordered to forfeit $55,000.
Devin McEwin, 43, of Avery, a former RRAD official, pleaded guilty on May 27, 2021, to receiving bribes from Harrison and was sentenced to a five-year term of federal probation, including eight months of home confinement. McEwin was also ordered to forfeit $21,000 and pay a fine of $5,000.
Louis Singleton, 64, of Texarkana, a former RRAD official, pleaded guilty on April 27, 2022, to receiving bribes from Harrison and others and was sentenced to five years of federal probation, including eight months of home confinement, and was ordered to forfeit $18,000.
“The Red River Army Depot is a key component of our nation’s defense infrastructure and is the lifeblood of the surrounding community,” said U.S. Attorney Brit Featherston. “Scarbrough, Harrison, Bishop, McEwin, Singleton, and others exploited the public trust in order to line their own pockets and undermined the warfighting mission of the Depot in the process.”
“These sentences are a direct reflection of the tenacity and teamwork by MPFU special agents and our law enforcement partners,” said SA Scott Moreland, Special Agent-in-Charge of the Major Procurement Fraud Field Office (MPFFO), U.S. Army CID. “Bribery and other fraud schemes have no place in the government contracting system and those who attempt it will be caught.”
“Today’s announcement highlights a successful collaboration among partner agencies as we collectively hold these defendants accountable for allegedly creating a fraudulent and deceptive scheme against the government and the people of the United States. We remain committed to the aggressive pursuit of those who selfishly leverage government programs for their own personal gain,” said Dallas FBI Special Agent in Charge, Matthew J. DeSarno.
According to information presented in court, Scarbrough was the Equipment Mechanic Supervisor at the RRAD in Texarkana, Texas, a position he held from November 2001 until May 2019. Scarbrough directed more than $7 million in purchases from RRAD to Harrison and Bishop through the government purchase card (GPC) program. In order to manipulate the GPC program, which is designed to ensure a competitive bidding process, Scarbrough told the vendors what to bid, including the item, the quantity, and the price. By collecting fake bids from multiple vendors, Scarbrough was able to direct RRAD purchases to his select vendors, in this case Harrison and Bishop, while maintaining the appearance of a competitive bidding process. Scarbrough also defrauded the United States by falsely certifying that he had received the purchased items, therefore causing the RRAD to pay his select vendors. However, the reality was that Scarborough instructed the vendors not to deliver certain RRAD-purchased items.
Scarbrough demanded hundreds of thousands of dollars in bribes from his selected vendors. Scarbrough accepted bribes in various forms, including receiving at least $116,000.00 in U.S. Postal Service money orders from Harrison. Scarbrough also had Harrison and Bishop purchase at least $135,000.00 in car parts or services for his hot rod collection, which included a red and black 1936 Ford Tudor, an electric green 1932 Ford Coupe, a cherry red 1951 Ford F-1 truck, and more. Scarbrough received more than $27,000.00 worth of firearms from Bishop, including rare Colt handguns and Wurfflein dueling pistols. Finally, Scarbrough directed at least $32,000.00 in donations to the Hooks Volunteer Fire Department while he was the Capitan of Operations. In total, Scarbrough received more than $300,000.00 in bribe payments from Harrison and Bishop.
Scarbrough is not the only official at RRAD who accepted bribes. Devin McEwin accepted more than $21,000.00 in bribes from Harrison, including hunting trips, donations directed to the Annona Volunteer Fire Department, and the refurbishment of his 1964 Ford truck. Additionally, Louis Singleton accepted more than $18,000 in bribes from Harrison and others, including tickets to the Hall of Fame section of AT&T Stadium for the Dallas Cowboys football game against the New England Patriots. Singleton was the supervisor of the GPC program at the RRAD and was responsible for approving purchases requested by Scarbrough.
Jimmy Scarbrough, 69, of Hooks, pleaded guilty on August 22, 2022, to conspiring with Harrison, Bishop, and others to defraud the United States, commit theft of government property, and commit bribery. At that time, Scarbrough agreed to forfeit his 1951 Ford F-1 pickup truck and amount of money to be determined by the court. Scarbrough faces up to 5 years in federal prison and is awaiting sentencing.
This was investigated by the U.S. Army Criminal Investigation Command, Major Procurement Fraud Unit; the Federal Bureau of Investigation-Dallas Division, Tyler Resident Agency, and the U.S. Postal Inspection Service. This case was prosecuted by Assistant U.S. Attorney Jonathan R. Hornok.
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Former Renton, Washington, dentist charged federally with illegally distributing prescription opiatesRead the Press Release
Seattle – A former dentist who practiced in Renton until his license was indefinitely suspended by the Washington State Dental Commission, was indicted federally for four counts of distributing a controlled substance, announced U.S. Attorney Nick Brown. Luke Edward St. Marie, 34, appeared in federal court today and entered pleas of “not guilty.”
The federal indictment lists four instances between January 2018 and July 2018, when prescriptions for oxycodone and hydrocodone were allegedly issued under his credential outside the scope of professional practice with no legitimate medical purpose. Trial on the charges is scheduled in front of U.S. District Judge Lauren King on November 21, 2022.
When the state suspended St. Marie’s license indefinitely in April 2021, it concluded St. Marie, “wrote prescriptions outside of a provider-patient relationship, didn’t adequately document prescriptions, rewrote an altered prescription, didn’t report that his prescription pad may have been compromised, and didn’t take adequate steps to ensure all prescriptions issued under his authority were valid.” The dental commission referred the matter to the Drug Enforcement Administration (DEA) for criminal investigation.
In court today, prosecutors noted that the four counts in the indictment comprise just a fraction of the illegal distribution. The investigation revealed that seventy-five prescriptions were improperly written, many in the names of St. Marie’s then-girlfriend, her family, and friends. Sadly, the former girlfriend overdosed at St. Marie’s home, and died days later in the hospital.
Distribution of controlled substances is punishable by up to 20 years in prison.
The charges contained in the indictment are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
St. Marie was released on personal recognizance bond pending future hearing in the case.
The case was investigated by the DEA and is being prosecuted by Assistant United States Attorney Michelle Jensen.
Former Oregon Dentist Pleads Guilty to Stealing Nearly $11.5 Million in Covid-Relief Program FundsRead the Press Release
PORTLAND, Ore.—A former Oregon dentist pleaded guilty today in federal court for fraudulently converting to his personal use nearly $11.5 million in loans intended to help small businesses during the COVID-19 pandemic.
Salwan Adjaj, 43, of West Linn, Oregon, pleaded guilty to wire fraud and aggravated identity theft.
According to court documents, beginning no later than September 2020 and continuing until at least May 2021, Adjaj submitted dozens of fraudulent loan applications to the Small Business Administration (SBA) in an attempt to obtain Economic Impact Disaster Loan (EIDL) and Paycheck Protection Program (PPP) funds. The EIDL and PPP programs were among several economic relief programs originally authorized by the Coronavirus Aid, Relief, and Economic Security Act (CARES). They enabled SBA to issue low-interest loans to small businesses adversely impacted by the pandemic and associated mitigation measures.
Adjaj used the names and employer identification numbers (EIN) of fictitious business entities on his fraudulent applications. He further provided false information about the business start dates, number of employees, and locations, and the identities of the purported applicants and business owners. Most of the fraudulent applications were submitted in other peoples’ names, but with Adjaj’s personal residence as the business mailing address. All of the applications were submitted online from an internet protocol (IP) address associated with Adjaj’s dental practice.
After SBA rejected most of Adjaj’s initial EIDL applications, he began focusing primarily on the PPP program as well as the Restaurant Revitalization Fund (RRF), a pandemic economic relief program aimed at supporting restaurants, bars, and other food- and drink-related businesses. The RRF program was authorized by the American Rescue Plan Act (ARPA) in March 2021. Adjaj had substantially greater success stealing PPP and RRF funds than he did EIDL. In May 2021, Adjaj submitted three RRF applications for restaurants allegedly located Sarasota, Miami, and Daytona Beach, Florida. Like his fraudulent EIDL and PPP applications, Adjaj’s RRF applications contained false business information and all listed his personal residence as the business mailing address.
Together, Adjaj’s fraudulent applications caused the SBA to pay out more than $11.5 million in loans, grants, and associated lender fees.
On October 14, 2021, Adjaj was charged by criminal complaint with wire fraud and aggravated identity theft. On December 14, 2021, he was arrested following a pretrial release violation and, one day later, ordered detained pending further court proceedings. Adjaj remains in custody pending sentencing.
On July 13, 2022, in a separate criminal case, Adjaj pleaded guilty to illegally distributing controlled substances, including thousands of pills of prescription drugs and anabolic steroids. Adjaj further admitted to using his position as a dentist to obtain some of the drugs he illegally distributed.
In his Covid-relief fraud case, Adjaj faces a maximum sentence of 22 years in prison, a $250,000 fine (or twice his gross gains or his victims’ gross losses), and three years’ supervised release. In his drug case, Adjaj faces a maximum sentence of 10 years in prison, a $500,000 fine, and three years of supervised release. He will be sentenced in both cases on December 6, 2022, by U.S. District Court Judge Michael W. Mosman.
As part of his plea agreement, Adjaj has agreed to pay no less than $10.5 million in restitution to SBA and his victim lenders.
This case was investigated by the U.S. Treasury Inspector General for Tax Administration (TIGTA), the SBA Office of Inspector General, the U.S. Secret Service, and the FBI. Assistant U.S. Attorney Ryan W. Bounds is prosecuting the case.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Justice Department’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
Former Nurse Agrees to Plead Guilty to Drug Diversion from Two Boston-Area HospitalsRead the Press Release
BOSTON – A former nurse has been charged and has agreed to plead guilty in connection with the diversion of opioids from two Boston-area hospitals.
Lisa Tarr, 33, of St. Petersburg, Fla., was charged and has agreed to plead guilty to four counts of unlawfully obtaining controlled substances by fraud, deception and subterfuge. A plea hearing has not yet been scheduled by the Court.
According to the charging documents, in August 2018, Tarr was a Student Nurse working at a Boston-area hospital. It is alleged that Tarr admitted to investigators at the hospital that she had stolen and self-injected fentanyl, a Schedule II controlled substance, from the hospital.
In 2020, while working for another Boston-area hospital, Tarr stole an infusion bag containing fentanyl that was being used to treat a patient. On another occasion in 2020, while still working at the second hospital, Tarr stole multiple syringes of hydromorphone, a Schedule II controlled substance, from a locked drug cabinet.
The charge of unlawfully obtaining controlled substances by fraud provides a sentence of no greater than four years in prison, one year of supervised release and a fine of up to $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and statutes which govern the determination of a sentence in a criminal case.
United States Attorney Rachael S. Rollins; Fernando McMillan, Special Agent in Charge of the Food and Drug Administration, Office of Criminal Investigations, New York Field Office; and Margret Cooke, the Commissioner of the Massachusetts Department of Public Health made the announcement today. Assistant U.S. Attorney Kelly Begg Lawrence, Chief of Rollins’ Health Care Fraud Unit, and Assistant U.S. Attorney Evan Panich of Rollins’ Narcotics & Money Laundering Unit are prosecuting the case.
The details contained in the charging document are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Former NYPD Sergeant Pleads Guilty to Embezzlement SchemeRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, Michael J. Driscoll, Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), Thomas M. Fattorusso, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation, New York Field Office (“IRS-CI”), and Jonathan Mellone, Special Agent-in-Charge of the New York Regional Office of the U.S. Department of Labor – Office of Inspector General (“DOL-OIG”), announced that ANTHONY LISI pled guilty to conspiracy to commit wire fraud for his involvement in an embezzlement scheme. LISI surrendered yesterday and pled guilty before United States District Judge Paul A. Engelmayer, to whom his case is assigned.
U.S. Attorney Damian Williams said: “As he admitted, Anthony Lisi participated in an embezzlement scheme. Lisi accepted a job with a technology company and, for over a year, submitted falsified weekly time sheets to his employer. He claimed that he had worked eight hours per day, every day—including various holidays—when he had not. As a law enforcement officer who worked for the NYPD for over 20 years, including as a Sergeant, Lisi knew right from wrong.”
FBI Assistant Director Michael J. Driscoll said: “As he admitted, Mr. Lisi intentionally defrauded his victims through an embezzlement scheme as soon as he began his employment. As a law enforcement officer, he knew better than most that by lying about the services he provided he was committing a crime. Embezzlement schemes harm both private businesses and the broader economy regardless of their scale. The FBI and our law enforcement partners will continue to work to hold fraudsters accountable in our justice system.”
IRS-CI Special Agent in Charge Thomas M. Fattorusso said: “There is simply no excuse for Lisi, whose job as a Sergeant with the NYPD was to understand how laws work and how laws are broken. His scheme to make fast cash without doing the work has now landed him on the wrong side of the law, and his guilty plea moves him a step closer to realizing the consequences of his actions.”
According to the allegations in the Information, court filings, and statements made in court:
In connection with an IT services contract, a technology company hired ANTHONY LISI. From January 2018 to February 2019, LISI electronically submitted weekly time sheets in which he represented to the technology company that he had worked eight hours per day, every day, including various holidays. In fact, he had not. These false representations induced the technology company to pay LISI.
* * *
LISI, 47, pled guilty to one count of conspiracy to commit wire fraud, which carries a maximum sentence of 20 years in prison. Under the terms of his plea agreement, LISI has agreed to forfeit $66,100 and to pay restitution of $94,185.
The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. LISI is scheduled to be sentenced by Judge Engelmayer on December 21, 2022, at 10:30 a.m.
Mr. Williams praised the outstanding efforts of the FBI, IRS-CI, and DOL-OIG. Mr. Williams also noted that the investigation is ongoing.
This matter is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorney Michael D. Neff is in charge of the prosecution.
Food Drive Helps Ease Burden for Those in NeedRead the Press Release
Miami, Florida – Staff from the United States Attorney’s Office for the Southern District of Florida (USAO-SDFL) served nearly 400 people this morning during a Farm Share Food Drive at Demps Park in Miami.
The distribution was scheduled to run from 9 a.m. to noon, but people were lined up by 8 a.m. so staff adjusted and began an hour early. The supplies, which included two pallets of meat, several bread bins, and a large amount of pasta and canned items were gone shortly after 10 a.m.
“The reality is that there is food insecurity nationwide and particularly in South Florida,” said J.D. Smith, Chief of Law Enforcement Coordination and Community Outreach Section, USAO-SDFL. “Prices have gone up on everything and people are on limited incomes … this is an important resource that people depend on.”
If the speed with which the food drive was over is any indication, then, yes, it seems people do depend on these types of services.
“There is this impression that everyone is working, but that just isn’t the case,” said Smith. “For senior citizens, the young, and the unemployed, it can be a difficult situation. We are fortunate enough to have jobs and be in a position to help.”
For Smith, it comes down to doing the right thing. It’s a sense of duty.
“It’s important for us to pay it forward,” he said. “We all have that bell in the back of our minds that reminds us to help people other than our own families. It’s our duty to answer that bell.”
The most important aspect for Department of Justice staff at the food drive was simple—helping people.
“It means a lot to me because people have suffered,” said Mark McKinney, Law Enforcement Coordination specialist with USAO-SDFL. “Doing something positive for the community helps relieve a burden. We do these food drives consistently so at least those who need assistance know they can count on this.”
Department of Justice staff members hold these drives four times per month by partnering with Farm Share, Miami-Dade County Parks and Recreation, and Miami-Dade Police Department—South District. Click here for times and locations as they do change.
Staff from the U.S. Attorney’s Office for the Southern District of Miami gather by the Farm Share truck that supplied the food for today’s Food Drive at Demps Park in Miami. Nearly 400 people were served in a little more than two hours.
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First-ever False Claims Act settlement received from Paycheck Protection Program lenderRead the Press Release
HOUSTON – Prosperity Bank has agreed to pay $18,673.50 to resolve allegations it improperly processed a Paycheck Protection Program (PPP) loan on behalf of an ineligible customer, announced U.S. Attorney Jennifer B. Lowery.
Prosperity Bank is a regional bank with branches throughout Texas and Oklahoma. It is a subsidiary of Prosperity Bancshares Inc.
The Coronavirus Aid, Relief and Economic Security (CARES) Act authorized the issuance of PPP loans in order to provide relief to small businesses experiencing economic hardship during the pandemic. Those loans would be forgiven if certain conditions were met.
Lenders like Prosperity Bank who originated PPP loans were entitled to receive a fixed fee from the Small Business Administration (SBA).That fee ranged from 1% to 5% depending on the size of the loan.
In May 2020, Prosperity Bank approved and processed a $213,400 PPP loan for Woodlands Pain Institute PLLC. The PPP application included a question asking whether the applicant (or any individual owning more than 20% equity) is subject to an indictment, criminal information, arraignment or other means by which formal criminal charges are brought in any jurisdiction.
Dr. Emad Bishai was the sole owner of Woodlands Pain Institute PLLC. However, at the time of the application, Bishai was facing criminal charges in Montgomery County arising from his practice of prescribing opioid medicines. When filling out the application, he checked the box marked “No” and initialed his name beneath the question.
At that time, Prosperity Bank employees knew Bishai was facing charges and was therefore ineligible to apply for the PPP loan. However, the bank processed the application anyway and falsely granted the money to Bishai. As a result, Prosperity Bank received a 5% processing fee of $10,670 to which it was not entitled.
Bishai entered into a $523,331 settlement in November 2021 to resolve his liability arising from fraudulent medical billing and his submission of the PPP loan application. He also repaid the PPP loan in full in 2022.
The settlement announced today is believed to be the nation’s first settlement with a PPP lender pursuant to the False Claims Act. The settlement amount also reflects Prosperity Bank’s efforts to cooperate with the government’s investigation and provide relevant facts along with its implementation of additional compliance measures.
The SBA’s Office of Litigation provided assistance. Assistant U.S. Attorney Brad Gray handled the matter.
The claims resolved by the settlement are allegations only and there has been no determination of liability.
Final Member of Multi-State Drug Trafficking Organization Sentenced to More Than 10 Years in Federal PrisonRead the Press Release
CHARLESTON, W.Va. – Robert Sanders Jr., 30, of Ashland, Kentucky, was sentenced today to 10 years and one month in prison, to be followed by five years of supervised release, for his role in a drug trafficking organization (DTO) responsible for distributing methamphetamine, fentanyl, cocaine and marijuana in Parkersburg and elsewhere.
According to court documents and statements made in court, Sanders admitted to supplying co-defendants Matthew Edward Depew and Carlo Ramsey with methamphetamine that Depew and Ramsey redistributed in the Parkersburg area between June 2021 and September 2021. During this same time period, another co-defendant, Floyd Dermonta Ramsey, supplied the DTO with fentanyl, cocaine and marijuana that originated in Chicago, Illinois.
Sanders pleaded guilty to conspiracy to distribute methamphetamine. The other defendants were sentenced to the following prison terms after pleading guilty to felony offenses:
- Carlo Ramsey, 57, of Chicago, Illinois, to nine years for conspiracy to distribute methamphetamine;
- Matthew Edward DePew, 31, of Zanesville, Ohio, to five years for conspiracy to distribute methamphetamine;
- Era Dawn Corder, 47, of Parkersburg, to three years for conspiracy to distribute methamphetamine;
- Floyd Dermonta Ramsey, 42, of Chicago, Illinois, to three years for possession with intent to distribute fentanyl, cocaine, and marijuana;
- Ambera Roberts, 35, of Parkersburg, to one year and six months for conspiracy to distribute methamphetamine.
The case resulted from a nearly year-long investigation dubbed “Long Time Coming.” The investigation also yielded more than a dozen arrests on state criminal complaints in Wood County.
“This successful prosecution dismantled a drug trafficking organization that inflicted much harm on this community,” said United States Attorney Will Thompson. “The dedication and teamwork evident in this case underscores our resolve to prevent overdoses and protect lives.”
Thompson commended the excellent investigative work of the Drug Enforcement Administration (DEA), the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the Parkersburg Narcotics Task Force (PNTF), the Parkersburg Police Department, the West Virginia State Police, the United States Postal Inspection Service, the Vienna Police Department, the Williamstown Police Department, the Wood County Sheriff’s Office, the Cabell County Sheriff’s Department, the Boyd County, Kentucky, Sheriff’s Department, the Russell, Kentucky, Police Department and the Raceland, Kentucky, Police Department.
“I also commend Assistant United States Attorney Jeremy B. Wolfe, who prosecuted the case,” Thompson said.
Senior United States District Judge John T. Copenhaver, Jr. imposed the sentence.
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. 2:21-cr-163.
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FBI and Law Enforcement Partners Arrest Nearly 6,000 Violent Criminals This SummerRead the Press Release
FBI Director Christopher Wray announced today in a video message the results of joint violent crime enforcement efforts throughout the summer, recognizing the essential cooperation of local and state law enforcement agencies around the country.
Between May 1, and Sept. 2, 2022, the FBI and local and state law enforcement partners arrested nearly 6,000 alleged violent criminals and gang members and seized more than 2,700 firearms connected to criminal conduct. Throughout the summer, the FBI and its partners also disrupted nearly 845 and dismantled 105 violent gangs and criminal enterprises and seized large quantities of fentanyl and other deadly narcotics.
“Keeping our communities and our country safe is the Justice Department’s priority, every single day. At the beginning of this year, we further intensified our department-wide efforts to combat violent crime, including by directing all 94 U.S. Attorneys’ offices to develop and implement district-specific violent crime reduction strategies,” said Attorney General Merrick B. Garland. “Together with our law enforcement partners across the country, we will continue to do everything we can to protect our communities from violent crime.”
“I believe the FBI’s most sacred duty is to ensure people can live free from fear in their own homes and neighborhoods,” said Director Wray. “To that end, we dedicate agents, analysts, and technical resources across the country to work with state and local law enforcement on these operations.”
These joint violent crime enforcement efforts resulted in FBI operations occurring in many communities across the country, including in New Mexico, California, Texas, Illinois, Hawaii, Puerto Rico, Pennsylvania, and Washington, D.C., as summarized below:
The FBI Albuquerque Violent Gang Task Force executed 16 federal search warrants targeting violent street and prison gangs. More than a dozen federal, state, and local law enforcement agencies and SWAT teams seized more than one million fentanyl pills, 142 pounds of methamphetamine, 37 firearms, nine ballistic vests, two hand grenades, and $1.8 million in cash.
The Los Angeles Metropolitan Task Force on Violent Gangs arrested 28 members and associates of the South Los Angeles-based Eastside Playboys street gang for alleged federal racketeering, firearms, and narcotics charges. The task force seized approximately 47 firearms, almost 200 kilograms of methamphetamine, 27 kilograms of cocaine, more than 13 kilograms of fentanyl, and more than seven kilograms of heroin.
In Houston, 10 MS-13 gang members were federally indicted for racketeering conspiracy, murder, attempted murder, and conspiracy to murder in aid of racketeering, related firearms charges, and obstruction of justice. The seven murders alleged in the indictment were especially brutal, using mutilation and dismemberment with machetes, and included the killing of a juvenile female and a police informant.
As part of FBI Sacramento’s efforts in a multi-agency coordinated operation targeting the South Lake Tahoe area, seven defendants were charged with conspiracy to distribute and distribution of methamphetamine and heroin. Separately, four subjects were indicted for trafficking methamphetamine and firearms, including an AR-15-style rifle, a shotgun, and several handguns, some of which were “ghost” guns, lacking serial numbers.
In Chicago, three individuals were charged for two separate violent carjackings. In both instances, the defendants allegedly brandished a semiautomatic handgun, and in one, the defendants also allegedly used a semiautomatic rifle. Another defendant was charged in a separate carjacking in downtown Chicago, which also included the use of a firearm.
Out of FBI San Antonio’s Waco Resident Agency, a federal grand jury indicted 27 defendants for their involvement in a Texas-based drug trafficking organization operating a methamphetamine distribution ring, leading to numerous arrests.
A federal investigation into a Hawaiian criminal enterprise resulted in three subjects being arrested for their alleged participation in drug trafficking of methamphetamine and cocaine, operating an illegal gambling business, as well as firearms possession. The criminal enterprise operated throughout the Hawaiian Islands.
Forty-one violent gang members from Puerto Rico were arrested on drug trafficking and firearms charges. The criminal organization allegedly distributed heroin, cocaine, marijuana, Oxycodone, Xanax, and other drugs throughout Puerto Rico.
The FBI Washington Field Office’s Cross Border Safe Streets Task Force, recovered eight firearms and significant quantities of Fentanyl and crack cocaine stemming from searches related to their investigation. Ten defendants were arrested for allegedly conspiring to distribute Fentanyl and cocaine throughout the D.C. area.
Twenty-five people were arrested in Pennsylvania for allegedly running a drug trafficking ring. The subjects allegedly engaged in a widespread drug distribution conspiracy that crossed state lines into Florida, Puerto Rico, and Arizona.
Similar to the those listed here, the FBI and our law enforcement partners conducted numerous operations in many other cities across the nation, including Cleveland, Buffalo, New Haven, Charlotte, Springfield, and more, and will continue these efforts against violent crime to help keep our communities safe for everyone.
Learn more about the FBI’s work in investigating violent crime at fbi.gov/violentcrime. Report tips to tips.fbi.gov; you can remain anonymous, or call 1-800-CALL FBI (800-225-5324).
Eighth and Final Defendant Sentenced in New Buffalo Cocaine RingRead the Press Release
GRAND RAPIDS, MICHIGAN — U.S. Attorney Mark Totten announced that on September 12, 2022, the Honorable Paul L. Maloney, United States District Judge for the Western District of Michigan sentenced Adrian Romero Antunez (35), a Mexican national in the United States on a tourist visa, to 46 months in prison for his role in a conspiracy to distribute five (5) kilograms or more of cocaine. Romero Antunez was the final defendant to be sentenced in a transnational and interstate cocaine ring that centered around New Buffalo, Michigan resident Ivan Huerta Hernandez (33). Through conduits in Mexico, Huerta Hernandez was supplied by sources located in Chicago, Illinois, including Romero Antunez. Huerta Hernandez then distributed cocaine to dealers in West Michigan and Northern Indiana.
On the morning of November 3, 2021, approximately 90 federal, state, and local law enforcement officers executed arrest warrants and six search warrants in four judicial districts: the Western District of Michigan, the Northern District of Indiana, the Northern District of Illinois, and the Central District of Illinois. Investigators seized over 1.5 kilograms of cocaine. Investigators also seized approximately $100,000 in cash, six vehicles, and two firearms.
The men who have been convicted of felony charges are listed below:
Name
Residence
Age
Sentence
Ivan Huerta Hernandez
New Buffalo, Michigan
33
87 months
Adrian Romero Antunez
Chicago, Illinois
35
46 months
Henry Shavar Nichols
Greenville, South Carolina
41
36 months
Marcus Jemel Johnson
Benton Harbor, Michigan
41
46 months
Juan Martinez Camarillo
Michigan City, Indiana
37
57 months
Donald James Rogers
New Buffalo, Michigan
62
12 months and 1 day
Manuel Eudave
La Porte, Indiana
54
Fine
Santiago Cardenas
Michigan City, Indiana
41
Probation and Fine
For more information, please see the continuation in support of the criminal complaint available on the public docket. United States v. Hernandez, et al., No. 21-MJ-551, ECF No. 1 (W.D. Mich.).
In announcing the sentences, U.S. Attorney Mark Totten said, “The convictions and sentences in this case represent a significant victory against a transnational drug trafficking conspiracy.” He continued: “My office is committed to combatting large-scale traffickers who bring these poisons to the Western District of Michigan. This prosecution demonstrates the power of pooling the resources of federal, state, and local governments. Drug trafficking organizations do not recognize political boundaries and we must continue to work together to combat drug trafficking organizations across Michigan, the Midwest, and the United States.”
“An investigation like this can only be successful when law enforcement agencies at all levels work together to remove those who pollute local neighborhoods with dangerous drugs,” said James A. Tarasca, Special Agent in Charge of the FBI in Michigan. “This investigation effectively dismantled a transnational, interstate drug trafficking organization that set up operations in the New Buffalo area. The FBI will continue to work with our partners to rid the streets of these criminals and make our communities safer for all citizens.”
“This sentencing should serve as a reminder that along with our Federal, State and local law enforcement partners, DEA is dedicated to identifying, investigating and dismantling drug trafficking organizations who look to profit from the suffering of others,” said Orville Greene, Special Agent in Charge, Detroit Field Division of the Drug Enforcement Administration.
“The Berrien County Sheriff’s Office is honored to partner with the FBI, DEA, and other law enforcement agencies to ensure that the residents of southwest Michigan and the entire United States are protected from individuals and organizations that are trying to harm our residents and citizens,” said Berrien County Sheriff, L. Paul Bailey. “The Berrien County Sheriff’s Office is proud of the hard work and dedication of all law enforcement personnel who took part in this investigation and brought it to a successful conclusion.”
The case was investigated and prosecuted as part of an Organized Crime and Drug Enforcement Task Force (OCDETF) investigation that began in 2020 and has been led by the Federal Bureau of Investigation (FBI), Drug Enforcement Administration (DEA), United States Marshals Service (USMS), Immigration and Customs Enforcement (ICE), United States Postal Inspection Service (USPIS), Michigan State Police’s Southwest Enforcement Team (SWET), Berrien County Sheriff’s Department (BCSD), Pokagon Band Tribal Police, Michigan City Police Department, La Porte City Police Department, and the Cook County Sheriff 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 an 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.
Assistant United States Attorneys Vito S. Solitro and Daniel T. McGraw prosecuted the case.
Eight Indicted in Joint Task Force Alpha Investigation and Arrested as Part of Takedown of Prolific Human Smuggling NetworkRead the Press Release
The U.S. Department of Justice, along with its partners, today announced a significant enforcement operation that disrupted and dismantled a prolific human smuggling operation in Texas and across the Southern United States. The operation, a part of Joint Task Force Alpha (JTFA), included the arrest of eight alleged human smugglers whose indictment were unsealed today in the Southern District of Texas (SDTX).
“Over a year ago, we launched Joint Task Force Alpha to strengthen our efforts across government to dismantle the most dangerous human smuggling and trafficking networks,” said Attorney General Merrick B. Garland. “The charges announced today are just the latest example of these efforts’ success. The Justice Department will continue to bring our full resources to bear to combat the human smuggling and trafficking groups that endanger our communities, abuse and exploit migrants, and threaten our national security.”
Erminia Serrano Piedra aka Irma, and Boss Lady, 31, led the human smuggling operation. Other defendants include Kevin Daniel Nuber aka Captain, 41; Laura Nuber aka Barbie, 40; Lloyd Bexley, 51; Jeremy Dickens, 45; Katie Ann Garcia aka Guera, 39; Oliveria Piedra-Campuzana, 53; and Pedro Hairo Abrigo, 33. All were arrested in Texas, Louisiana, Mississippi, and Alabama pursuant to charges previously filed in the SDTX and unsealed today.
According to the indictment, they facilitated the unlawful transportation and movement of migrants within the United States in deplorable conditions for profit. The migrants were allegedly citizens of Mexico, Guatemala and Colombia. The migrants or their families allegedly paid members of the human smuggling organization to help them travel illegally to and within the United States.
According to the indictment, the criminal human smuggling organization allegedly used drivers to pick up migrants near the U.S.-Mexico border and transport them further into the interior of the United States. They allegedly often harbored the migrants at “stash houses” along the way in locations such as Laredo and Austin, Texas. Drivers allegedly used various methods to transport migrants, including by hiding them in suitcases placed in pickup trucks and cramming migrants in the back of tractor-trailers, covered beds of pickup trucks, repurposed water tankers or wooden crates strapped to flatbed trailers. The human smuggling organization allegedly used methods to transport migrants that placed their lives in danger as they were frequently held in contained spaces with little ventilation, no temperature control and in conditions that placed them at great risk. Drivers for the organization were allegedly paid as much as $2,500 for each migrant they unlawfully transported.
81 migrants in the back of a tractor trailer. Migrants trapped inside the bed cover of a pickup truck. Migrants inside a wooden crate.The indictment also notices the criminal forfeiture of three properties as well as money judgments amounting to $2,299,152.40.
“This human smuggling organization operated on an enormous scale, placing a high value on financial profit, while putting migrants’ lives at great risk,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “JTFA will continue to use all means necessary to pursue and dismantle criminal smuggling networks and protect the vulnerable populations they exploit.”
“Sadly, this case is an example of what we see in our district, too many times, especially in our border communities,” said U.S. Attorney Jennifer B. Lowery for the Southern District of Texas. “Our Laredo office works continuously with our valued partners to bring to justice those who allegedly put profits ahead of everything else. No amount of money should be a substitute for human life.”
“At DHS, countering human smuggling is a moral imperative, a law enforcement priority, and a necessity for our national security,” said Deputy Secretary John K. Tien of the Department of Homeland Security. “It is a central plank of our efforts to address irregular migration across the western hemisphere, and to hold transnational criminal organizations accountable for perpetrating vile and horrific crimes. We are unwavering in our commitment, and sending a strong message: if you manipulate and imperil and take advantage of struggling migrants, we are coming for you. This investigation is a perfect example of how we're bringing our agencies and components together to leverage the full force of the federal government to do just that.”
“Transnational criminal organizations often use sophisticated circumvention techniques to facilitate their smuggling and trafficking efforts,” said Acting Deputy Director PJ Lechleitner of the U.S. Immigration and Customs Enforcement (ICE). “Special agents with Homeland Security Investigations (HSI) employ a full range of law enforcement techniques and cross-border authorities to combat human smuggling by effectively eliminating profit incentives, seizing assets, and maintaining strong collaborative relationships with law enforcement partners across the country and world. Today should be a reminder that if you are going to engage in this type of criminal activity, your criminal network is not invisible. The members of the organization will be exposed, the network will be dismantled, and you will be brought to justice.”
“Human smugglers are criminals who do not care about human life,” said Deputy Commissioner Troy Miller of U.S. Customs and Border Protection (CBP). “They lie to make money, convincing vulnerable migrants to hand over what is often their life savings in exchange for empty promises to get to the United States. Smugglers regularly abandon migrants in the desert or mountains with no food or water, leaving them for dead. CBP strives to be flexible, adaptable, and to think outside the box when it comes to disrupting these criminal organizations and protecting migrants from harm.”
The indictments against these defendants were brought under JTFA. Attorney General Garland created JTFA in June 2021, in partnership with DHS, to strengthen the department’s overall efforts to combat the dangerous rise in human smuggling emanating from Central America and impacting our border communities. JTFA’s goal is to disrupt and dismantle those human smuggling and trafficking networks operating in El Salvador, Guatemala, Honduras, and Mexico, with a focus on networks that endanger, abuse or exploit migrants, present national security risks or engage in other types of transnational organized crime.
Since its creation, JTFA has successfully increased coordination and collaboration between the Justice Department, DHS, and other interagency law enforcement participants along with foreign law enforcement partners including El Salvador, Guatemala, Honduras and Mexico; targeted those organizations who have the most impact on the United States; and coordinated significant smuggling indictments and extradition efforts in U.S. Attorneys’ Offices across the country. To date, JTFA’s work with its partners has resulted in criminal charges and over 100 domestic and international arrests against leaders, organizers and significant facilitators of human smuggling activities, several dozen convictions, significant prison sentences and substantial asset forfeiture.
JTFA is comprised of detailees from southwest border U.S. Attorneys’ Offices, including the Southern District of Texas, the Western District of Texas, the District of New Mexico, the District of Arizona, and the Southern District of California, and dedicated support for the program is also provided by numerous components of the Justice Department’s Criminal Division that are part of JTFA – led by the Human Rights and Special Prosecutions Section (HRSP) and supported by the Office of Prosecutorial Development, Assistance and Training (OPDAT), the Narcotic and Dangerous Drug Section (NDDS), the Money Laundering and Asset Recovery Section (MLARS), the Office of Enforcement Operations (OEO), the Office of International Affairs (OIA), and the Organized Crime and Gang Section (OCGS). JTFA is made possible by substantial law enforcement investment from DHS, FBI, U.S. Drug Enforcement Administration, and other partners.
HSI Laredo, along with CBP’s U.S. Border Patrol Laredo Sector and DHS-OIG, led U.S. investigative efforts and received substantial assistance from HSI offices in Austin, San Antonio, and Corpus Christi, Texas; New Orleans, Louisiana; Gulfport, Mississippi; Mobile, Alabama; West Palm Beach, Florida; and its Human Smuggling Unit in Washington, D.C.; along with CBP’s National Targeting Center; U.S. Marshals Service; ICE’s Enforcement and Removal Operations – Austin; Police Departments in Laredo, Kileen, and Round Rock, Texas, Wiggins, Missouri, and Bogalusa, Louisiana; Webb County, Texas, Constable’s Office; Webb County, Texas, District Attorney’s Office; Sheriff’s offices in Webb, Bastrop, and Caldwell County, Texas, and Harrison County, George County, and Stone County, Mississippi; Jefferson Parish and Washington Parish, Louisiana; and Mississippi Bureau of Narcotics; and the Louisiana State Police.
Trial Attorneys Erin Cox and Christian Levesque of the Justice Department’s Human Rights and Special Prosecution Section; Assistant U.S. Attorney Jennifer Day for the Southern District of Texas and JTFA; Assistant U.S. Attorney Paul Harrison for the Southern District of Texas; Trial Attorney Daria Andryushchenko and Financial Investigator Kelly O’Mara of the Justice Department’s Money Laundering and Asset Recovery Section handled the case, with substantial assistance from the Justice Department’s Electronic Surveillance Unit of the Office of Enforcement Operations.
The charges contained in an indictment are merely allegations. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Dyer Man Sentenced to 240 Months in PrisonRead the Press Release
HAMMOND- Ronald Ortega, 48 years old, of Dyer, Indiana, was sentenced by United States District Court Judge Jon E. DeGuilio on his plea of guilty to possession and production of child pornography, announced United States Attorney Clifford D. Johnson.
Ortega was sentenced to 240 months in prison followed by 5 years of supervised release and ordered to pay $10,000 in restitution.
According to documents in the case, Ortega produced child pornography with two separate victims. He also possessed child pornography of children, including victims that were under the age of 12.
This case was investigated by the Federal Bureau of Investigation and the Dyer Police Department. This case was prosecuted by Assistant United States Attorney Emily A. Morgan.
The case was brought as part of Project Safe Childhood. In 2006, the Department of Justice created Project Safe Childhood, a nationwide initiative designed to protect children from exploitation and abuse. Led by the U.S. Attorneys’ Offices and the DOJ’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who exploit children, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov .
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Drug User Pleads Guilty to Firearms OffensesRead the Press Release
PITTSBURGH, PA - A resident of Aleppo, Pennsylvania, pleaded guilty in federal court to charges of violating federal firearm laws, United States Attorney Cindy K. Chung announced today.
Chester Aaron Hostutler, age 35, pleaded guilty to two counts of possession of a firearm and ammunition by an unlawful drug user before United States District Judge Marilyn J. Horan.
In connection with the guilty plea, the court was advised that Troopers with the Pennsylvania State Police conducted traffic stops of a vehicle driven by Hostutler on two separate days in August 2020. During each traffic stop, Hostutler admitted to using drugs and to having a firearm.
On each occasion, law enforcement recovered a firearm from the vehicle and determined Hostutler had recently used controlled substances. The firearm recovered in the first traffic stop was loaded and previously reported stolen.
Judge Horan scheduled sentencing for Jan. 4, 2023, at 10:00 a.m. The law provides for a total sentence of not more than ten years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Pending sentencing, the court ordered Hostutler to remain in the custody of the U.S. Marshals Service.
Assistant United States Attorney Brendan J. McKenna is prosecuting this case on behalf of the government.
The Pennsylvania State Police conducted the investigation that led to the prosecution of Hostutler.
Dominican National Sentenced to 4 Years in Federal Prison for Fentanyl Trafficking OffenseRead the Press Release
Vanessa Roberts Avery, United States Attorney for the District of Connecticut, today announced that REGINO MORILLO-ESPINAL, 40, a citizen of the Dominican Republic last residing in Allentown, Pennsylvania, was sentenced yesterday by U.S. District Judge Janet Bond Arterton in New Haven to 48 months of imprisonment for a fentanyl trafficking offense.
According to court documents and statements made in court, members of the Drug Enforcement Administration’s Hartford Task Force identified Morillo-Espinal as a member of a fentanyl trafficking ring. On March 26, 2021, investigators stopped Morillo-Espinal’s vehicle on I-91 South after he had traveled from Allentown to multiple locations in Hartford. He was arrested after a search of the vehicle revealed approximately two kilograms of suspected fentanyl.
Morillo-Espinal has been detained since his arrest. On October 27, 2021, he pleaded guilty to possession with intent to distribute 40 grams or more of fentanyl.
Morillo-Espinal faces immigration proceedings when he completes his prison term.
The DEA’s Hartford Task Force includes personnel from the DEA Hartford Resident Office, the Connecticut State Police, and the Bristol, Hartford, East Hartford, Enfield, Manchester, New Britain, Rocky Hill, Wethersfield, Windsor Locks and Willimantic Police Departments.
This case was prosecuted by Assistant U.S. Attorney Geoffrey M. Stone 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.
Defendant Pleads Guilty to Bank Secrecy Act ChargesRead the Press Release
Earlier today, in federal court in Brooklyn, Hanan Ofer pleaded guilty to failing to maintain an effective anti-money laundering program in violation of the Bank Secrecy Act, as part of a scheme to bring lucrative and high-risk international financial business to a small, unsophisticated credit union. Today’s proceeding took place before United States Magistrate Judge Ramon E. Reyes, Jr. When sentenced, Ofer faces up to 10 years in prison.
Breon Peace, United States Attorney for the Eastern District of New York, Kenneth Polite Jr., Assistant Attorney General of the Justice Department’s Criminal Division, and Rick J. Patel, Acting Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), announced the guilty plea.
“Ofer willfully disregarded provisions of the Bank Secrecy Act that are designed to prevent money laundering and the use of our financial system for criminal ends. This Office will vigorously enforce those laws to ensure the integrity of the U.S. financial system,” stated United States Attorney Peace. “With his admissions today, the defendant will be held responsible for exposing financial institutions to the risk of illicit activity.”
“Ofer’s failure to implement anti-money laundering practices as required by the Bank Secrecy Act (BSA) exposed Financial Institutions to the likelihood of high-risk transactions which ultimately led to the processing of billions in bulk cash from Mexican-based banks without proper oversight,” stated HSI Acting Special Agent-in- Charge Patel. “Money laundering is a vital component of transnational criminal organizations wishing to legitimize their ill-gotten gains and ensuring the compliance of BSA regulations is the first step to fighting these organizations. HSI is a leader in financial crimes investigations and will continue to seek the prosecution of those who attempt to circumvent the law for quick financial gains.”
According to court filings, from 2014 to 2016, Ofer operated the New York State Employees Federal Credit Union Services Organization (NYSEFCU-CUSO), a money services business that was required to have an effective anti-money laundering program. Through the NYSEFCU-CUSO and other entities, Ofer participated in a scheme that brought over $1 billion in high-risk transactions, including millions of dollars of bulk cash transactions from a Mexican bank, to the New York State Employees Federal Credit Union (NYSEFCU).
Ofer was experienced in international banking and trained in anti-money laundering compliance and procedures, and represented to the NYSEFCU that he and the NYSEFCU-CUSO would conduct appropriate anti-money laundering oversight as required by the Bank Secrecy Act. Instead, Ofer failed to implement an effective anti-money laundering program at the NYSEFCU-CUSO. This failure caused the NYSEFCU to process high-risk transactions, including from Mexican banks, without appropriate oversight and without ever filing a single Suspicious Activity Report, as required by law.
In July 2022, Mr. Peace was selected as the Chairperson of the White Collar Fraud subcommittee for the Attorney General’s Advisory Committee (AGAC). As the leader of the subcommittee, Mr. Peace will play a key role in making recommendations to the AGAC to facilitate the prevention, investigation and prosecution of various financially motivated, non-violent crimes including mail and wire fraud, bank fraud, health care fraud, tax fraud, securities and commodities fraud, and identity theft.
The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section, in coordination with the Office’s Bank Integrity Task Force, which is charged with investigating and charging corporate and individual actors who launder criminal proceeds using the U.S. banking system and enforcing anti-money laundering controls under the Bank Secrecy Act. Assistant United States Attorneys Ryan C. Harris and Francisco J. Navarro of the Eastern District of New York are prosecuting the case with Trial Attorneys Margaret Moeser and Leigh Kessler of the Criminal Division’s Money Laundering and Asset Recovery Section. The investigation is being conducted by HSI’s El Dorado Task Force in New York.
The Defendant:
HANAN OFER
Age: 69
New York, New YorkE.D.N.Y. Docket No. 21-CR-174 (DG)
Dayton woman charged with federal crimes related to stealing identities of local victimsRead the Press Release
DAYTON, Ohio – A Dayton woman was arrested by federal agents this afternoon on charges alleging she has stolen the identities of several young women in the Dayton area and used those identities to commit various types of fraud.
Tiffany Lewis, 29, appeared in U.S. District Court in Dayton today following her arrest.
According to the charging documents, in March and April 2021, Lewis stole the identities of two area women and used their information to obtain approximately $8,000 total in personal loans from Lendmark. Lewis allegedly cashed out those loans at Checksmart locations in Fairborn and Monroe, Ohio. Lewis was photographed at each Checksmart location and is covering her distinctive neck tattoos in each of the photographs.
In June and July 2021, Lewis allegedly used a third stolen identity to commit various acts of fraud.
For example, Lewis allegedly used the victim’s identity to obtain a fraudulent Ohio driver’s license and a car loan for approximately $48,000.
In addition, it is alleged that Lewis used the identity on two separate occasions to rent Chevrolet Silverado trucks from Uhaul in Dayton. One of the trucks was later discovered at Lewis’s residence and had been spray-painted black.
Lewis allegedly used the third victim’s identity to write fraudulent checks at Menards in Fairborn totaling more than $3,500. When questioned at the store by a Fairborn police officer, Lewis presented her fake driver’s license, which was flagged as fraudulent in the officer’s computer.
Lewis is charged with committing Social Security number fraud, wire fraud, bank fraud and aggravated identity theft.
If you think you may also be a victim of Lewis’s alleged fraud, please contact the Social Security OIG tip line at: 1-800-269-0271.
Kenneth L. Parker, United States Attorney for the Southern District of Ohio and Andrew Boockmeier, Special Agent in Charge, Social Security Administration, Office of the Inspector General (SSA-OIG) announced the charges. The U.S. Secret Service, U.S. Marshals Service, and Dayton, Fairborn, Whitehall and Riverside police departments all contributed to this investigation.
Special Assistant United States Attorney Timothy Landry is representing the United States in this case.
A criminal complaint merely contains allegations, and defendants are presumed innocent unless proven guilty in a court of law.
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Chief Credit Officer Admits to Conspiracy to Defraud First NBC BankRead the Press Release
NEW ORLEANS – United States Attorney Duane A. Evans announced that WILLIAM J. BURNELL (“BURNELL”), age 72, a resident of Kenner, Louisiana, pleaded guilty today to conspiracy to defraud First NBC Bank (“ Bank “), the New Orleans-based bank that failed in April 2017.
According to court documents, from in or around 2006 through April 2017, BURNELL was the Bank’s Chief Credit Officer. He was responsible for the overall quality of the Bank’s lending function; the Bank’s credit policies and administration; the Bank’s loan recovery and collection efforts; and the Bank’s monitoring and managing of past due loans, including the approval of the Bank’s internal list of past-due loans. BURNELL was responsible for compiling month-end reports, including lists of overdrawn borrowers and past-due loans. These reports should have accurately shown the quality of the Bank’s assets, which included loans. Misrepresentations on these reports made a true assessment of the Bank’s overall financial well-being impossible. BURNELL was also responsible for approving credit risk ratings before the Bank decided to lend to its customers.
Other people involved with the Bank, including the Bank’s board of directors, external auditors, and federal and state regulators, relied on BURNELL as the Chief Credit Officer to inform them about problems with the Bank’s asset quality, including problems with loans. Nevertheless, BURNELL conspired with the Bank’s President Ashton J. Ryan, Jr., Executive Vice President Robert B. Calloway, Senior Vice President Fred V. Beebe, and others to conceal material information and defraud the Bank. For example, BURNELL, Ryan, and Calloway knowingly concealed material information about borrower Gary Gibbs from the board, auditors, and examiners. Further, BURNELL served as an additional approving officer for loans to borrower Warren Treme, who was Ryan’s business partner. Beebe was Treme’s loan officer. BURNELL, Ryan, and Beebe made misrepresentations in Treme’s loan documents and to the board, auditors, and examiners, in ways that financially benefited Ryan. Calloway, Gibbs, and Treme have all previously pleaded guilty to conspiracy to defraud the Bank, as have the Bank’s General Counsel Gregory St. Angelo, borrower Kenneth Charity, borrower Jeffrey Dunlap, and borrower Arvind Vira. The trial for Ryan, Beebe, and borrower Frank Adolph is scheduled to begin on January 3, 2023.
“Today’s guilty plea once again demonstrates that the FDIC OIG and our law enforcement partners from the United States Attorney’s Office, Eastern District of Louisiana; Federal Bureau of Investigation; and the Board of Governors of the Federal Reserve System, Consumer Financial Protection Bureau, Office of Inspector General will continue to investigate those individuals, including bank directors and officers who are entrusted to manage financial institutions, but cause harm to our nation’s banking industry,” said Anand Ramlall, Special Agent in Charge, Dallas Region, Office of Inspector General for the Federal Deposit Insurance Corporation.
“Today’s plea agreement illustrates the FBI’s steadfast commitment to bringing those who commit white collar crimes to justice, like Mr. William J. Burnell,” said Douglas A. Williams, Jr., Special Agent in Charge, FBI New Orleans. “We thank our partners from the United States Attorney’s Office, Eastern District of Louisiana; Federal Deposit Insurance Corporation, Office of Inspector General; and the Board of Governors of the Federal Reserve System, Consumer Financial Protection Bureau, Office of Inspector General for their strong partnerships in protecting the integrity of the American banking system.”
“Today’s plea sends a clear message that bank executives who commit fraud and deliberately deceive regulators will be brought to justice for their actions. I commend our agent and their federal law enforcement partners for their hard work and persistence, which ultimately led to this outcome,” said Stephen Donnelly, Acting Special Agent in Charge, Eastern Region, Office of Inspector General for the Board of Governors of the Federal Reserve System and the Bureau of Consumer Financial Protection.
BURNELL has pleaded guilty to one count of conspiracy to commit bank fraud, in violation of Title 18, United States Code, Sections 1344 and 1349. The maximum penalties that may be imposed upon conviction are thirty years in prison; a fine of up to $1,000,000, or the greater of twice the gain to BURNELL or twice the loss to any victim; up to five years of supervised release; and a $100 mandatory special assessment fee .
Judge Eldon E. Fallon scheduled BURNELL’s sentencing for March 16, 2023, at 2:00pm.
This case is being investigated by the Federal Bureau of Investigation; the Federal Deposit Insurance Corporation, Office of Inspector General; and the Board of Governors of the Federal Reserve System, Consumer Financial Protection Bureau, Office of Inspector General. Assistant U.S. Attorneys Matthew R. Payne, Nicholas D. Moses, J. Ryan McLaren, and Rachal Cassagne are in charge of the prosecution.
California Man Pleads Guilty to $400,000 Fraud Scheme Involving Minnesota-Based RetailerRead the Press Release
ST. PAUL, Minn. – A California man has pleaded guilty to wire fraud after defrauding his former employer, a Minnesota-based retailer, of more than $400,000, announced U.S. Attorney Andrew M. Luger.
According to court documents, Michael John Gennarelli, 32, of Huntington Beach, California, was employed as a sales consultant and mobile supervisor for Company A, a retail store based in Minnesota. Gennarelli unlawfully accessed Company A’s computer network and obtained sales receipt information for high-dollar-value purchases that were not associated with a “My Rewards” account, Company A’s customer loyalty program. Gennarelli then created numerous fraudulent “My Rewards” accounts, applied the stolen sales receipts information, and claimed the associated “My Rewards” points for the value of such purchases. In total, Gennarelli issued himself approximately $467,307 in “My Rewards” certificates, $393,200 of which he redeemed for merchandise and gift cards in Company A stores and on Company A’s website.
Gennarelli pleaded guilty today before U.S. District Judge Katherine M. Menendez to one count of wire fraud. A sentencing hearing will be scheduled at a later time.
This case is the result of an investigation conducted by the U.S. Secret Service and the Minnesota Bureau of Criminal Apprehension.
Assistant U.S. Attorney Chelsea A. Walcker is prosecuting the case.
Brothers Plead Guilty to Trafficking More Than $100 Million of Cocaine in International WatersRead the Press Release
Tampa, FL – United States Attorney Roger B. Handberg announces that Robin Castro-Gomez (35, Colombia, South America) and his brother, Alvaro Castro-Gomez (41, Colombia, South America), have pleaded guilty to conspiracy with the intent to distribute five kilograms or more of cocaine on a vessel subject to the jurisdiction of the United States. Robin Castro-Gomez faces a minimum mandatory penalty of 10 years, and up to life, in federal prison. Alvaro Castro-Gomez faces a minimum mandatory penalty of 15 years, and up to life, in federal prison. They were indicted on March 5, 2019.
According to the plea agreement, Robin and Alvaro Castro-Gomez are responsible for attempting to traffic over 3,500 kilograms (7,700 pounds) of cocaine from Colombia to Central America. In 2017 and 2018, the United States Coast Guard interdicted three separate low-profile vessels in the Eastern Pacific Ocean, each loaded with cocaine and destined for Central America. Robin Castro-Gomez was directly responsible for leading and organizing each of these drug ventures from Colombia. Alvaro Castro-Gomez, who was previously convicted in federal court for trafficking cocaine on the high seas, assisted his brother at the launch sites. He also recruited, hired, and paid one of the mariners to participate in the conspiracy.
This case was investigated by the Panama Express Strike Force, an Organized Crime Drug Enforcement Task Force (OCDETF) comprised of agents and analysts from the United States Coast Guard Investigative Service, Drug Enforcement Administration, the Federal Bureau of Investigation, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the Naval Criminal Investigative Service, and U.S. Southern Command's Joint Interagency Task Force South. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at www.justice.gov/OCDETF. The case is being prosecuted by Assistant United States Attorney David J. Pardo.
Bay Area Rapper Mark “Kafani” Hicks and Two Co-Conspirators Sentenced to Prison for Multi-Million Dollar Mortgage Fraud SchemeRead the Press Release
SAN FRANCISCO – Bay area rapper Mark “Kafani” Hicks, aka Amir Rashad, was sentenced to 87 months in prison for his role in orchestrating a complex loan fraud and identity theft conspiracy, announced United States Attorney Stephanie M. Hinds, FBI Special Agent in Charge Sean Ragan, U.S. Postal Inspection Service Acting Inspector in Charge Kevin Rho, and U.S. Secret Service Special Agent in Charge Shawn M. Bradstreet. Co-defendants Demarcus Hicks and Dionysius “Donnie” Costello were sentenced to 48 months and 54 months respectively for their roles in the two-year conspiracy. An additional three members of the fraud ring were sentenced on May 23, 2022, and June 13, 2022. A seventh alleged member remains a fugitive. The sentences were handed down by the Hon. James Donato, United States District Judge.
According to the plea agreements, Mark Hicks admitted to being at the center of a conspiracy in which he directed a team of criminals who stole approximately $2 million from banks and lending institutions. Specifically, Hicks admitted that within months of being released from prison in November 2017, he began orchestrating a scheme and conspiracy to defraud lending institutions and financial institutions. Hicks admitted that he obtained the personal identifying information of nine victims; obtained additional information about the victims, such as their credit history; used the illegally-obtained information to create fraudulent bank accounts, emails, and phone numbers in the victims’ names; and then applied for mortgage refinance loans in the victims’ names.
Hicks admitted that he used these methods to victimize nine individuals when fraudulently applying for eight loans. In some cases, the loans were not approved. In other cases, Hicks convinced lending institutions to forward funds to fraudulently-created bank accounts.
During the sprawling two-year loan fraud conspiracy, Hicks impersonated victims in over a dozen phone calls with banks, lending institutions, and gold dealers. Hicks used the stolen funds primarily to buy gold bars and coins that his co-conspirators sold for cash. Over $480,000 of the illicit gains were recovered from a safe deposit box controlled by Hicks’s relatives.
Demarcus Hicks (Mark Hicks’s half-brother) and Costello each admitted to assisting Hicks in executing various aspects of the scheme. For example, Demarcus Hicks admitted that after he was made aware of the scheme, he obtained and passed on to coconspirators the personal identifying information of a victim, he sold gold bars and coins that had been purchased with the proceeds of the scheme, he traveled with coconspirators who impersonated victims to get fraudulent loan documents notarized, and he withdrew cash from bank accounts that had been fraudulently established as part of the scheme. Similarly, Costello admitted that after being informed about the scheme, he obtained counterfeit drivers’ licenses with the names of victims but photographs of coconspirators, and facilitated meetings between coconspirators and notaries to obtain fraudulent loan documents.
In sum, the scheme included the following defendants:
Defendant Age, Residence Statutes of Conviction Sentence Imposed Mark “Kafani” Hicks 42, Oakley, California 18 U.S.C. § 1349
18 U.S.C. § 1344
18 U.S.C. § 1028A 87 months Demarcus Hicks 38, Stockton, California 18 U.S.C. § 1349
18 U.S.C. § 1344
18 U.S.C. § 1028A 48 months Dionysius Costello 38, Berkeley, California 18 U.S.C. § 1349
18 U.S.C. § 1344
18 U.S.C. § 1028A 54 months Susan Arreola-Martin 72, Antioch, California 18 U.S.C. § 1349
18 U.S.C. § 1344
18 U.S.C. § 1028A
21 U.S.C. § 841 84 months Leif Skorochod 48, San Francisco, California 18 U.S.C. § 1349
18 U.S.C. § 1344
18 U.S.C. § 1028A 14.5 months Christopher Pool 57, Stockton, California 18 U.S.C. § 1349
18 U.S.C. § 1344
18 U.S.C. § 1028A 15 monthsJudge Donato ordered each of the defendants to pay restitution in the amount of $1,904,988.79.
The cases were prosecuted by Assistant U.S. Attorneys Barbara J. Valliere and David J. Ward, with assistance from Claudia Hyslop and Kathy Tat. The prosecutions are the result of investigations by the Federal Bureau of Investigation, the United States Secret Service, and the United States Postal Inspection Service.
Banker Pleads Guilty to Bank Secrecy Act ChargesRead the Press Release
A New York man pleaded guilty today in the Eastern District of New York to failure to maintain an effective anti-money laundering program in violation of the Bank Secrecy Act as part of a scheme to bring lucrative and high-risk international financial business to a small, unsophisticated credit union.
According to court documents, from 2014 to 2016, Hanan Ofer, 69, of New York City, operated the New York State Employees Federal Credit Union Service Organization (NYSEFCU-CUSO), a money services business that was required to have an effective anti-money laundering program. Through the NYSEFCU-CUSO and other entities, Ofer participated in a scheme that brought more than $1 billion in high-risk transactions, including millions of dollars of bulk cash transactions from a Mexican bank, to the New York State Employees Federal Credit Union (NYSEFCU).
Ofer was experienced in international banking and trained in anti-money laundering compliance and procedures, and represented to the NYSEFCU that he and his businesses would conduct appropriate anti-money laundering oversight as required by the Bank Secrecy Act. Instead, Ofer willfully failed to implement an effective anti-money laundering program at the NYSEFCU-CUSO. This failure caused the NYSEFCU to process the high-risk transactions without appropriate oversight and without ever filing a single Suspicious Activity Report, as required by law.
Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division, U.S. Attorney Breon Peace for the Eastern District of New York, and Acting Special Agent in Charge Ricky J. Patel of Homeland Security Investigations (HSI) New York made the announcement.
HSI New York investigated the case.
Trial Attorneys Margaret Moeser and Leigh Kessler of the Criminal Division’s Money Laundering and Asset Recovery Section (MLARS) and Assistant U.S. Attorneys Ryan C. Harris and Francisco J. Navarro for the Eastern District of New York are prosecuting the case.
MLARS’s Bank Integrity Unit investigates and prosecutes banks and other financial institutions, including their officers, managers, and employees, whose actions threaten the integrity of the individual institution or the wider financial system.