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2 September 2022
Mexican National Sentenced for Assaulting a Border Patrol AgentRead the Press Release
TUCSON, Ariz. – On Tuesday, Martin Trinidad-Solano, 25, of Mexico, was sentenced by Senior United States District Judge Raner C. Collins to approximately 14 months in prison, followed by one year of supervised release. Trinidad-Solano previously pleaded guilty to one count of Assault on a Federal Officer on June 15, 2022.
Trinidad-Solano assaulted a United States Border Patrol (USBP) agent assigned near the U.S. – Mexico Boundary Fence near Douglas, Arizona. Border Patrol surveillance notified the agent of a suspected undocumented noncitizen hiding in the brush. The agent approached Trinidad-Solano when a chase ensued. The USBP agent was able to apprehend Trinidad-Solano, who then assaulted the agent.
The Customs and Border Protection’s U.S. Border Patrol conducted the investigation in this case. Assistant U.S. Attorneys Adam D. Rossi and Matthew C. Cassell, District of Arizona, Tucson, handled the prosecution.
CASE NUMBER: CR-21-01791-TUC-RCC-LCKC
RELEASE NUMBER: 2022-153_Trinidad-Solano
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For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.Medical Technology Company President Convicted in $77 Million COVID-19 and Allergy Testing SchemeRead the Press Release
A federal jury convicted the president of a Silicon Valley-based medical technology company yesterday of participating in a scheme to mislead investors, commit health care fraud, and pay illegal kickbacks in connection with the submission of over $77 million in false and fraudulent claims for COVID-19 and allergy testing.
Mark Schena, 59, of Los Altos, California, served as the president of Arrayit Corporation. According to court documents and evidence presented at trial, Schena engaged in a scheme to defraud Arrayit’s investors by claiming that he had invented revolutionary technology to test for virtually any disease using only a few drops of blood. In meetings with investors, Schena and his publicist claimed that Schena was the “father of microarray technology” and falsely stated that he was on the shortlist for the Nobel Prize. The evidence at trial showed that Schena also falsely represented to investors that Arrayit could be valued at $4.5 billion based on purported revenues of $80 million per year.
In furtherance of the scheme, the evidence at trial showed that Schena, among other things, failed to release Arrayit’s SEC-required financial disclosures and concealed that Arrayit was on the verge of bankruptcy. Schena lulled investors who were concerned that the company was a “scam” by inviting them to private meetings and issuing false press releases and tweets stating that Arrayit had entered into lucrative partnerships with companies, government agencies, and public institutions, including a children’s hospital and a major California health care provider. The tweets and press releases falsely claimed that such entities had agreed to use the Arrayit technology, when in fact no such agreements existed or were of minimal value.
Schena also orchestrated an illegal kickback and health care fraud scheme that involved submitting fraudulent claims to Medicare and private insurance for unnecessary allergy testing. Arrayit ran allergy screening tests on every patient for 120 different allergens (ranging from hornet stings to codfish) regardless of medical necessity. In order to obtain patient blood specimens, Schena paid kickbacks to marketers in violation of the Eliminating Kickbacks in Recovery Act and orchestrated a deceptive marketing plan that falsely claimed that the Arrayit test was highly accurate in diagnosing allergies, when it was not, in fact, a diagnostic test. Arrayit billed more per patient to Medicare for blood-based allergy testing than any other laboratory in the United States, the evidence at trial showed, and billed some commercial insurers over $10,000 per test.
In early 2020, Arrayit’s allergy testing business declined because the COVID-19 pandemic and stay-at-home orders reduced demand for allergy testing. Schena then falsely announced that Arrayit “had a test for COVID-19” based on Arrayit’s blood testing technology, before developing such a test. Seeking to capitalize on the nationwide shortage of COVID-19 testing, Schena orchestrated a deceptive marketing scheme that falsely claimed that Dr. Anthony Fauci and other prominent government officials had mandated testing for COVID-19 and allergies at the same time and required that patients receiving the Arrayit COVID-19 test also be tested for allergies. Schena also falsely claimed that the Arrayit COVID-19 test was more accurate than a PCR test for diagnosing COVID-19 infections, while concealing from investors and patients taking the test that the Food and Drug Administration had informed him that the Arrayit test was not accurate enough to receive an Emergency Use Authorization for use in the United States.
Schena was convicted of one count of conspiracy to commit health care fraud and conspiracy to commit wire fraud, two counts of health care fraud, one count of conspiracy to pay kickbacks, two counts of payment of kickbacks, and three counts of securities fraud. He is scheduled to be sentenced on Jan. 30, 2023 and faces a maximum penalty 20 years imprisonment for the conspiracy to commit health care fraud and conspiracy to commit wire fraud; 10 years of imprisonment for each count of health care fraud; five years imprisonment for conspiracy to pay kickbacks; 10 years imprisonment for each count of payment of kickbacks; and 20 years imprisonment for each count of securities fraud. U.S. District Judge Edward J. Davila will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division; U.S. Attorney Stephanie M. Hinds for the Northern District of California; Special Agent in Charge Craig D. Fair of the FBI’s San Francisco Field Office; Acting Special Agent in Charge Steven J. Ryan of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG); Inspector in Charge Delany De Leon-Colon of the U.S. Postal Inspection Service (USPIS) – Criminal Investigations Group; Special Agent in Charge Kim R. Lampkins of the Veterans Affairs Office of Inspector General (VA-OIG); and Special Agent in Charge Bryan D. Denny of the Defense Criminal Investigative Service (DCIS) Western Field Office made the announcement.
HHS-OIG’s San Francisco Regional Office and Detroit Regional Office, USPIS, the FBI, VA-OIG and DCIS investigated the case.
Acting Principal Assistant Chief Jacob Foster and Trial Attorney Laura Connelly of the Justice Department’s Fraud Section and Assistant U.S. Attorney Christina Liu for the Northern District of California are prosecuting the case.
The Fraud Section uses the Victim Notification System (VNS) to provide victims with case information and updates related to this case. Victims with questions may contact the Fraud Section’s Victim Assistance Unit by calling the Victim Assistance phone line at 1-888-549-3945 or by emailing [email protected]. To learn more about victims’ rights, please visit: https://www.justice.gov/criminal-vns/victim-rights-derechos-de-las-v-ctimas. If you believe you are a victim who has invested in Arrayit, or you have taken a COVID-19 test prepared or marketed by Arrayit, please visit https://www.justice.gov/criminal-vns/case/Arrayit.
Medical Technology Company President Convicted in $77 Million COVID-19 and Allegy Testing SchemeRead the Press Release
SAN JOSE – A federal jury convicted the president of a Silicon Valley-based medical technology company yesterday of participating in a scheme to mislead investors, commit health care fraud, and pay illegal kickbacks in connection with the submission of over $77 million in false and fraudulent claims for COVID-19 and allergy testing.
Mark Schena, 59, of Los Altos, California, served as the president of Arrayit Corporation. According to court documents and evidence presented at trial, Schena engaged in a scheme to defraud Arrayit’s investors by claiming that he had invented revolutionary technology to test for virtually any disease using only a few drops of blood. In meetings with investors, Schena and his publicist claimed that Schena was the “father of microarray technology” and falsely stated that he was on the shortlist for the Nobel Prize. The evidence at trial showed that Schena also falsely represented to investors that Arrayit could be valued at $4.5 billion based on purported revenues of $80 million per year.
“The Covid-19 pandemic presented our communities, our country, and indeed the world with profound challenges to our health care systems,” said U.S. Attorney Stephanie M. Hinds. “Mark Schena preyed on investors, customers, and the health care industry by claiming he was helping us all to meet some of these challenges. In fact, Schena committed federal crimes by, among other things, defrauding investors, receiving illegal kickbacks, disseminating deceptive marketing, and submitting fraudulent claims for reimbursement of unnecessary testing. We thank the jury for their careful attention to the evidence in this case and look forward to the sentencing phase of these proceedings.”
“Mark Schena defrauded investors, and health care insurance programs, then turned to exploit the pandemic with a Covid-19 test that returned inaccurate results and placed public safety at risk,” said FBI San Francisco Special Agent in Charge Sean Ragan. “The FBI, DOJ, and other federal law enforcement partners will identify and investigate anyone-from the street to a corporate boardroom-who capitalizes on any national emergency to commit fraud and threaten the integrity of the securities market.”
“Mr. Schena’s conviction holds him accountable for a multi-million dollar fraudulent scheme driven purely by greed and devoid of concern for his unwitting patients or financial backers,” said Bryan D. Denny, Special Agent in Charge for the Department of Defense (DoD) Office of Inspector General, Defense Criminal Investigative Service (DCIS), Western Field Office. “DCIS and our partners will continually seek to identify and eliminate fraudulent schemes that corrupt the integrity of TRICARE, the DoD’s health care program for uniformed service members, retirees, and their families.”
“Mark Schena orchestrated a wide-ranging fraud scheme to boost his profits by exploiting the American public’s trust, paying illegal kickbacks, and submitting millions in false claims to Medicare,” said Special Agent in Charge Steven J. Ryan of the U.S Department of Health and Human Services Office of Inspector General (HHS-OIG). “Working closely with our law enforcement partners, our agency will continue to investigate such fraudulent activity in order to protect taxpayer-funded federal health care programs from the abuse of bad actors.”
In furtherance of the scheme, the evidence at trial showed that Schena, among other things, failed to release Arrayit’s SEC-required financial disclosures and concealed that Arrayit was on the verge of bankruptcy. Schena lulled investors who were concerned that the company was a “scam” by inviting them to private meetings and issuing false press releases and tweets stating that Arrayit had entered into lucrative partnerships with companies, government agencies, and public institutions, including a children’s hospital and a major California health care provider. The tweets and press releases falsely claimed that such entities had agreed to use the Arrayit technology, when in fact no such agreements existed or were of minimal value.
Schena also orchestrated an illegal kickback and health care fraud scheme that involved submitting fraudulent claims to Medicare and private insurance for unnecessary allergy testing. Arrayit ran allergy screening tests on every patient for 120 different allergens (ranging from hornet stings to codfish) regardless of medical necessity. In order to obtain patient blood specimens, Schena paid kickbacks to marketers in violation of the Eliminating Kickbacks in Recovery Act and orchestrated a deceptive marketing plan that falsely claimed that the Arrayit test was highly accurate in diagnosing allergies, when it was not, in fact, a diagnostic test. Arrayit billed more per patient to Medicare for blood-based allergy testing than any other laboratory in the United States, the evidence at trial showed, and billed some commercial insurers over $10,000 per test.
In early 2020, Arrayit’s allergy testing business declined because the COVID-19 pandemic and stay-at-home orders reduced demand for allergy testing. Schena then falsely announced that Arrayit “had a test for COVID-19” based on Arrayit’s blood testing technology, before developing such a test. Seeking to capitalize on the nationwide shortage of COVID-19 testing, Schena orchestrated a deceptive marketing scheme that falsely claimed that Dr. Anthony Fauci and other prominent government officials had mandated testing for COVID-19 and allergies at the same time and required that patients receiving the Arrayit COVID-19 test also be tested for allergies. Schena also falsely claimed that the Arrayit COVID-19 test was more accurate than a PCR test for diagnosing COVID-19 infections, while concealing from investors and patients taking the test that the Food and Drug Administration had informed him that the Arrayit test was not accurate enough to receive an Emergency Use Authorization for use in the United States.
Schena was convicted of one count of conspiracy to commit health care fraud and conspiracy to commit wire fraud, two counts of health care fraud, one count of conspiracy to pay kickbacks, two counts of payment of kickbacks, and three counts of securities fraud. He is scheduled to be sentenced on Jan. 30, 2023 and faces a maximum penalty 20 years imprisonment for the conspiracy to commit health care fraud and conspiracy to commit wire fraud; 10 years of imprisonment for each count of health care fraud; five years imprisonment for conspiracy to pay kickbacks; 10 years imprisonment for each count of payment of kickbacks; and 20 years imprisonment for each count of securities fraud. U.S. District Judge Edward J. Davila will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
U.S. Attorney Stephanie M. Hinds; Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division; Special Agent in Charge Craig D. Fair of the FBI’s San Francisco Field Office; Acting Special Agent in Charge Steven J. Ryan of the U.S. Department of Health and Human Services Office of Inspector General; Inspector in Charge Delany De Leon-Colon of the U.S. Postal Inspection Service (USPIS) – Criminal Investigations Group; Special Agent in Charge Kim R. Lampkins of the Veterans Affairs Office of Inspector General (VA-OIG); and Special Agent in Charge Bryan D. Denny of the Defense Criminal Investigative Service Western Field Office made the announcement.
HHS-OIG’s San Francisco Regional Office and Detroit Regional Office, USPIS, the FBI, VA-OIG and DCIS investigated the case.
Assistant U.S. Attorney Christina Liu and Acting Principal Assistant Chief Jacob Foster and Trial Attorney Laura Connelly of the Justice Department’s Fraud Section are prosecuting the case.
The Fraud Section uses the Victim Notification System (VNS) to provide victims with case information and updates related to this case. Victims with questions may contact the Fraud Section’s Victim Assistance Unit by calling the Victim Assistance phone line at 1-888-549-3945 or by emailing [email protected]. To learn more about victims’ rights, please visit: https://www.justice.gov/criminal-vns/victim-rights-derechos-de-las-v-ctimas. If you believe you are a victim who has invested in Arrayit, or you have taken a COVID-19 test prepared or marketed by Arrayit, please visit https://www.justice.gov/criminal-vns/case/Arrayit.
Middleton Man Sentenced for Threatening an FBI AgentRead the Press Release
BOISE – A federal judge sentenced a Middleton, Idaho man to three years of supervised probation for threatening an FBI Agent, U.S. Attorney Josh Hurwit, of the District of Idaho, announced today.
According to court records, Jerald Reutzel, 48, of Middleton, Idaho, contacted a Federal Bureau of Investigation (FBI) Special Agent through text messaging in November of 2020. In the text message, Reutzel falsely accused the FBI agent of failing to investigate a local crime, referred to the agent with profane slurs, and threatened to assault the agent. Reutzel sent the threat on account of the FBI agent’s performance of his official duties and intended to threaten the FBI Special Agent. Reutzel was interviewed by law enforcement, where he admitted to sending the text message, acknowledged the message was threatening, but denied intending to carry out the threat.
Chief U.S. District Judge David C. Nye also gave Reutzel credit for serving 136 days in custody, and ordered he pay a $500 fine and a $100 special assessment.
“At the U.S. Attorney’s Office, one of our most solemn obligations is to support our law enforcement partners. Law enforcement agents protect the American people from violent crime, terrorism, and other threats to their safety, often at great personal sacrifice and risk,” said U.S. Attorney Hurwit. “Our office will not tolerate threats of violence against these public servants at any level.”
U.S. Attorney Hurwit made the announcement and commended the combined efforts of the Federal Bureau of Investigation and the Canyon County Sheriff’s Office, which led to charges.
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Lead defendant in Richmond County meth-trafficking conspiracy joins others in pleading guiltyRead the Press Release
AUGUSTA, GA: All four defendants in an Augusta methamphetamine-trafficking ring await sentencing now that the conspiracy’s lead defendant has admitted guilt.
Magnum Jelani Neely, 38, of Millen, Ga., an inmate at Dooly State Prison, awaits sentencing after pleading guilty to Conspiracy to Possess with Intent to Distribute, and to Distribute, 50 Grams or More of Methamphetamine, said David H. Estes, U.S. Attorney for the Southern District of Georgia. Neely’s guilty plea subjects him to a minimum statutory sentence of 10 years in prison, up to life, along with substantial financial penalties and a minimum of five years of supervised release after completion of any prison term. There is no parole in the federal system.
“With substantial assistance from co-conspirators, Neely was able to direct a high volume of meth distribution even as he served a 10-year state sentence for violent crime,” said U.S. Attorney Estes. “This investigation shut down his operation, and federal sentences will ensure these traffickers are held accountable for their crimes.”
As described in court documents and testimony, agents from the U.S. Drug Enforcement Administration in November 2021 joined investigators from the Richmond County Sheriff’s Office and the Burke County Sheriff’s Office in identifying Neely as coordinating a methamphetamine trafficking operation from inside prison. Neely used contraband cell phones to contact couriers outside prison to deliver drugs to buyers. The Georgia Department of Corrections assisted in the investigation, and Neely and three co-conspirators were indicted in April 2022.
The three co-conspirators include:
- Patricia Gregory, 45, of Augusta, awaits sentencing after pleading guilty to Conspiracy to Possess with Intent to Distribute, and to Distribute, 50 Grams or More of Methamphetamine;
- Fanesia Smith, 39, of Augusta, awaits sentencing after pleading guilty to Conspiracy to Possess with Intent to Distribute, and to Distribute, 50 Grams or More of Methamphetamine; and,
- Yvonne Smith, 57, of Augusta – mother of Fanesia Smith – faces a statutory sentence of up to three years in prison after pleading guilty to Misprision of a Felony for knowing of, and helping to conceal, the criminal activity of the conspiracy.
Each of the defendants will be sentenced by U.S. District Court Chief Judge J. Randal Hall after completion of a pre-sentence investigation by U.S. Probation Services.
“The ringleader of a once-thriving methamphetamine ring profited by spreading this insidious poison throughout Richmond County and elsewhere, all while serving a prison sentence,” said Robert J. Murphy, Special Agent in Charge of the DEA Atlanta Field Division. “But DEA and its law enforcement partners are committed to holding criminals accountable, no matter whether they're locked up or on the streets.”
“Any type of criminal activity perpetrated from behind the walls of our facilities will not be tolerated, and we appreciate the support and assistance of our law enforcement partners on every level, in our efforts to see that justice is being served on those who pose a threat to the safety of the public and the operations of our facilities,” said Georgi Department of Corrections Commissioner Timothy C. Ward.
The case was investigated by the U.S. Drug Enforcement Administration, the Richmond County Sheriff’s Office, the Burke County Sheriff’s Office, and the Georgia Department of Corrections, and prosecuted for the United States by Assistant U.S. Attorney Jeremiah L. Johnson
Jury Convicts Final Two in Massive Lynchburg-based Drug ConspiracyRead the Press Release
LYNCHBURG, Va. – A federal jury convicted the final two defendants in a massive Lynchburg-based drug conspiracy that trafficked cocaine from Texas and North Carolina into Lynchburg for distribution throughout Central Virginia.
Today, a jury convicted Ricky Donnell Abner, 44, and Charay Lamont Trent, 43, on drug conspiracy and weapons charges. In addition, the ringleader, Jermel “Jah” Storey, and 13 other individuals, including Antonio Edwards, Jason Ellison, Dashonna Farmer, Jason Hamlette, Steven Hughey, Jabari Johnson, Corey Johnson, James Mason, Adrian Mays, Christopher McDonald, Donnell Miller, Maggie Smith, and Juan Valdez, all pled guilty for their roles in the conspiracy.
Between January 2016 and January 2021, Storey supplied his complex network of drug dealers from his residence in Lynchburg by maintaining a steady stream of large amounts of narcotics from sources in Texas. Even after moving to Charlotte, North Carolina, Storey continued his drug-dealing conspiracy by directing his co-conspirators to meet him in Charlotte to collect the drugs and then return to Lynchburg for sales throughout Central Virginia.
“Today’s convictions bring to a close the final phase of a long term, multi-agency investigation and prosecution that will have a lasting impact on Central Virginia,” United States Attorney Christopher R. Kavanaugh said today. “These drug traffickers were responsible for bringing kilograms of narcotics into the Lynchburg area and were implicated in other violent criminal activity. The Lynchburg community is absolutely safer tonight due to the hard work and dedication of the federal, state, and local law enforcement agencies involved in this case.”
“Combating violent crime and narcotics distribution within our communities is a job we all take very seriously,” said Special Agent in Charge Patterson. “We will continue to leverage our resources and expertise as we work cohesively with our law enforcement and judicial partners to disrupt the illegal possession of firearms, distribution of narcotics and other acts of violence within our community.”
“The Lynchburg Police Department values its long-term relationships with our local, state, and federal law enforcement partners,” said Lynchburg Police Chief Ryan Zuidema. “These convictions are just one example of the great work the women and men of these collective agencies perform on a daily basis. We know drug activity directly ties into an increase in violent crime, and these convictions will have a significant impact on removing drugs from Lynchburg's streets as well as keeping our residents healthy and safe.”
“These successful prosecutions are the product of a unified response to drug trafficking by federal and state law enforcement agencies. The effects of this criminal activity are felt by those suffer from addiction to the poison these individuals spread into our communities. Drug trafficking frequently is associated with violent crime. This joint investigation, prosecution, and sentencing sends the message that there is a great price to pay for this illegal and dangerous activity. Great thanks go to our partner agencies and especially to the U. S. Attorney’s Office for the Western District for seeing these cases through the federal courts.” Bethany Harrison, Commonwealth’s Attorney for the City of Lynchburg
The Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Lynchburg Police Department, the Virginia State Police’s Central Virginia Drug and Gang Task Force, and the Office of the Commonwealth’s Attorney for the City of Lynchburg investigated the case.
Assistant U.S. Attorneys Sean M. Welsh and Ronald M. Huber prosecuted the case.
This prosecution is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks. Additional information about the OCDETF Program can be found at www.justice.gov/OCDETF.
Jury Convicts Albany Felon on Ammunition and Drug ChargesRead the Press Release
ALBANY, NEW YORK – Mikal Smith, age 28, of Albany, was convicted on August 31 of unlawfully possessing ammunition as a felon, and possessing and intending to distribute cocaine base, following a three-day trial. The announcement was made by United States Attorney Carla B. Freedman; Frank A. Tarentino III, Special Agent in Charge, U.S. Drug Enforcement Administration (DEA), New York Division; and Albany Police Chief Eric Hawkins.
The evidence at trial established that on April 7, 2021, Smith possessed with the intent to distribute 83 grams of cocaine base and possessed a large-capacity magazine loaded with 20 rounds of LC 5.56 ammunition. Smith discarded the cocaine base and ammunition during a foot pursuit after members of the Albany Police Department’s Community Response Unit attempted to arrest him on a parole warrant. At the time, Smith had felony convictions for Attempted Robbery in the Second Degree and Criminal Sale of a Controlled Substance in the Third Degree. Under federal law, these convictions prevented Smith from lawfully possessing the ammunition.
When United States District Judge Mae A. D’Agostino sentences him on December 14, 2022, Smith faces a minimum of 5 years and up to 40 years in prison, and a term of post-imprisonment supervised release of at least 4 years and up to life. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines, and other factors.
This case was investigated by the Albany Police Department and DEA, and is being prosecuted by Assistant United States Attorneys Allen J. Vickey and Katherine Kopita.
Jackson Felon Pleads Guilty to Using 3D-Printers to Manufacture MachinegunsRead the Press Release
Jackson, Miss. – A Jackson man pled guilty to two counts of being a felon in possession of a firearm and one count of engaging in business as a manufacturer of firearms, announced U.S. Attorney Darren J. LaMarca and Special Agent in Charge Kurt Thielhorn of the Bureau of Alcohol, Tobacco, Firearms and Explosives.
According to court documents, Kent Edward Newhouse, 41, possessed firearms on or about July 13, 2022 and July 20, 2022, and engaged in the business of manufacturing firearms from April to July 2022. In April 2022, the Bureau of Alcohol, Tobacco, Firearms and Explosives discovered through a confidential informant that Newhouse was using 3D-printers to manufacture auto-sears, which are firearm components designed to cause semi-automatic firearms to function as fully automatic machineguns. Under federal law, auto-sears are themselves machineguns. On July 13, 2022, Newhouse sold a confidential informant a firearm and several auto-sears. On July 20, 2022, a search warrant was executed at Newhouse’s residence, where additional firearms and auto-sears were located. The government also obtained videos of Newhouse operating fully functional machineguns. Newhouse was previously convicted of felony sale of controlled substances in Madison County in 2009.
“The United States Attorney’s Office is committed to prosecuting cases such as these and I applaud the investigative efforts of the Bureau of Alcohol, Tobacco, Firearms and Explosives,” said U.S. Attorney LaMarca. “Special Agent in Charge Thielhorn and ATF agents throughout the Southern District of Mississippi work tirelessly to enforce gun laws in Mississippi. These efforts help to make the citizens of Mississippi safer every day.”
“The use of 3-D printers to unlawfully manufacture firearms, and to make devices to convert semiautomatic firearms into machine guns, poses a real and current threat to our communities,” said ATF Special Agent in Charge Kurt Thielhorn. “ATF is committed to investigate and seek prosecution of these cases to the fullest extent of the law in order to protect our citizens.”
Newhouse will be sentenced on December 2, 2022, at 9:00 a.m. He faces a maximum penalty of 15 years in prison and a $250,000 fine on each count of felon in possession of a firearm; and 10 years and a $250,000 fine for engaging in business as a manufacturer of firearms. A federal district judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The Bureau of Alcohol, Tobacco, Firearms and Explosives, the Federal Bureau of Investigation, and the Jackson Police Department investigated the case.
Assistant U.S. Attorneys Andrew W. Eichner and Jessica Terrill are prosecuting the case.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
Hartford Fentanyl Dealer Sentenced to 3 Years in Federal PrisonRead the Press Release
Vanessa Roberts Avery, United States Attorney for the District of Connecticut, announced that ANTHONY DONES, also known as “Ant,” 41, was sentenced today by U.S. District Judge Jeffrey A. Meyer in New Haven to 36 months of imprisonment, followed by three years of supervised release, for distributing fentanyl and unlawfully possessing a firearm.
According to court documents and statements made in court, this matter stems from an investigation conducted by the FBI’s Northern Connecticut Gang Task Force and Hartford Police Department into drug trafficking and related criminal acts being committed by members and associates of the Los Solidos and Latin Kings street gangs in Hartford’s South End. Between January and April 2020, investigators conducted multiple controlled purchases of fentanyl from Dones and his associate, Juan Laureano, in the vicinity of Dones’ Montrose Street residence.
Dones and Laureano were arrested on April 8, 2020. When investigators arrived at Dones’ residence on that date, they found that Dones had just flushed an unknown quantity of fentanyl down the toilet. A search of Dones’ residence revealed that he was using his basement to process and package fentanyl for street sale. The search revealed a small quantity of fentanyl, narcotics processing materials, and a loaded .45 caliber pistol.
On March 15, 2022, Dones pleaded guilty to one count of conspiracy to possess with intent to distribute, and distribution, of fentanyl, and one count of unlawful possession of a firearm by a felon.
Dones, who had been released on bond, was remanded to custody at the conclusion of today’s court proceeding.
Laureano, of Hartford, pleaded guilty and, on March 30, 2022, was sentenced to 18 months of imprisonment.
This investigation was conducted by the FBI’s Northern Connecticut Gang Task Force and the Hartford Police Department. The FBI Task Force includes members of the Hartford Police Department, East Hartford Police Department, New Britain Police Department, West Hartford Police Department, Connecticut State Police and Connecticut Department of Correction. This case was prosecuted by Assistant U.S. Attorney Brian P. Leaming.
Grundy County Man Sentenced to More than 12 Years in Federal Prison for Illegally Possessing Firearms and Explosive DevicesRead the Press Release
CHICAGO — A Grundy County man has been sentenced to 12 and a half years in federal prison for illegally possessing firearms and explosive devices.
JOHN FEENEY possessed two handguns, three explosives, multiple magazines of ammunition, and drug paraphernalia on Jan. 25, 2020, in Morris, Ill. The explosives included a 4-inch diameter cardboard aerial shell containing perchlorate explosives and black powder; a 2-inch diameter cardboard aerial shell containing perchlorate explosives; and a 2-inch diameter cardboard aerial shell secured to a plastic cup and containing metal Phillips-head bits, copper wire, and perchlorate explosives. During a dispute a day earlier, Feeney used one of the firearms to shoot at an individual, striking the individual’s vehicle. Feeney had previously been convicted of a felony offense in state court and was prohibited by federal law from possessing a firearm or explosive.
Feeney, 32, of Minooka, Ill., pleaded guilty in federal court earlier this year to one count of illegal possession of a firearm by a convicted felon and one count of illegal possession of an explosive during the commission of a felony. U.S. District Judge Jorge L. Alonso imposed the 150-month prison sentence on Wednesday.
The sentence was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Kristen de Tineo, Special Agent-in-Charge of the Chicago Field Division of the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives; and Ken Briley, Grundy County Sheriff. The government was represented by Assistant U.S. Attorney Michelle Kramer.
Georgia Hunter Sentenced for Lacey Act Violation Stemming from Nebraska HuntRead the Press Release
Acting United States Attorney Steven Russell announced that Kyle G. Daniel, 36, of Ball Ground, Georgia, was sentenced today in federal court in Lincoln, Nebraska, for violating of the Lacey Act. United States District Judge John Gerrard sentenced Daniel to 2 years’ probation for unlawful transportation of wildlife in interstate commerce. Daniel was ordered to pay a fine in the amount of $5,000 and restitution in the amount of $4,000.
A joint investigation conducted by the United States Fish and Wildlife Service, Office of Law Enforcement and the Nebraska Game and Parks Commission, Law Enforcement Division determined that in October of 2020, Daniel traveled to Noble Outdoors, a commercial big game guiding and outfitting business located in North Platte, Nebraska, to conduct an archery mule deer hunt. During the hunt, Daniel unlawfully shot a mule deer and subsequently transported trophy parts of the deer out of the state for taxidermy services in Georgia.
As contained in the plea agreement accepted by the Court and admitted by Daniel, the investigation determined that in the fall of 2020, Daniel traveled to Noble Outdoors with two other hunting partners to hunt mule deer during the archery season. During the hunt, Daniel unlawfully shot a mule deer buck from the rear passenger seat area of a Noble Outdoors vehicle parked upon the traveled portion of a public roadway. Under Nebraska state law, shooting from the road and hunting upon property without landowner permission are prohibited. .
Under the terms of the plea agreement, Daniel surrendered and abandoned a total of six sets of antlers or taxidermy mounts originating from mule deer taken during hunts at Noble Outdoors in 2018, 2019, and 2020.
Today’s convictions mark the second federal sentencing involving the ongoing prosecution of numerous defendants related to violations committed by Noble Outdoors and its owner, associates, and clients. Four additional defendants have pleaded guilty in Nebraska state court. In total, six defendants have been sentenced and ordered to pay a total of $28,500 in fines and restitution for violations related to the interstate transport of unlawfully taken wildlife, shooting deer from the road; taking deer without a valid permit, taking deer with a firearm during archery season, dumping carcasses in waters of the state; hunting without permission; and improperly checking or registering big game.
The operation was a joint investigation conducted by the United States Fish and Wildlife Service, Office of Law Enforcement and the Nebraska Game and Parks Commission, Law Enforcement Division.
Fugitive Extradited from Mexico Sentenced for Role in Prostitution SchemeRead the Press Release
ALEXANDRIA, Va. – A man who was extradited from Mexico to face charges in the United States was sentenced today to 18 months in prison for aiding and abetting the transportation of a woman for purposes of prostitution.
According to court documents, from 2009 to 2010, Ramon Raudel Campos Murillo, 45, of Michoacan, Mexico, along with other individuals, conspired to operate a sex trafficking organization. In 2010, he aided and abetted those who drove a young woman from Maryland to locations across the Eastern District of Virginia and elsewhere to perform sex acts in exchange for money.
The prostitution enterprise operated in Virginia, Maryland, Washington, D.C., Delaware, and elsewhere. Drivers received calls from customers to arrange prostitution. Then, the drivers drove the young women to those customers. Young women saw as many as 30 clients per day and charged $30 for 15 minutes of sexual activity. The drivers collected the proceeds and the young women received only half of the money.
Campos Murillo was charged by indictment in 2011 and a warrant was issued for his arrest at that same time. According to a coconspirator, after some of Campos Murillo’s accomplices were charged, he fled from the United States to Mexico to avoid arrest. Campos Murillo was located in Mexico in 2021 and extradited to the United States earlier this year. At least seven other individuals were previously convicted of sex trafficking offenses for their roles in the scheme.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia; Derek W. Gordon, Acting Special Agent in Charge of U.S. Homeland Security Investigations, Washington D.C.; and Kevin Davis, Fairfax County Chief of Police, made the announcement after sentencing by U.S. District Judge Leonie M. Brinkema.
The Justice Department’s Office of International Affairs worked with law enforcement partners in Mexico to secure the arrest and extradition of Campos Murillo to the United States.
Assistant U.S. Attorneys Marc J. Birnbaum and Raizza K. Ty prosecuted the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:11-cr-578.
Four-Time Felon Sentenced to 2.5 Years in Federal Prison for Being Found Unlawfully in Possession of a FirearmRead the Press Release
INDIANAPOLIS – TorVon Davis, 31, of Indianapolis, was sentenced to two-and-a-half years in federal prison after pleading guilty to unlawful possession of a firearm by a felon.
According to court documents, on July 6, 2021, an Indianapolis Metropolitan Police (IMPD) detective conducting surveillance near east 46th Street, in Indianapolis, observed Davis pull into a gas station and park near a gas pump. The detective saw Davis exit the vehicle and observed that he had a firearm in his waistband. The detective also saw that Davis’ vehicle had a tinted license plate. The detective drove through the parking lot and was able to identify the license plate number, which was expired. Davis returned to the vehicle and drove towards 46th Street before turning onto Arlington, making several traffic infractions along the way.
The detective radioed to two uniformed patrol cars in the area advising them of Davis’ traffic violations and informed them that Davis was armed. A uniformed police officer in a fully marked police car located Davis, who was driving 60 miles per hour in a 35 miles per hour speed zone and initiated a traffic stop. Davis continued driving on Arlington and stopped after turning onto 41st Street. The officer approached the vehicle and identified Davis before asking for his license and registration. The officer asked Davis if he had any weapons in the vehicle, in which Davis falsely replied that he did not.
The officer returned to his vehicle and determined that Davis did not have a valid handgun permit in the state of Indiana. The officer was able to view photos, sent to him by the detective, of Davis entering the gas station with a handgun in his waistband and wearing the same clothes he was wearing at the time of the traffic stop. Davis was escorted out of the vehicle and placed in handcuffs. Davis admitted to the officer that he did not have a valid firearm permit and told the officer that he’d find the firearm in the glove box. The officer located a Ruger-57 semiautomatic handgun in the glovebox. Prior to transporting Davis to jail, Davis was searched, and the officer found a small bag of marijuana in Davis’ right sock.
Davis is prohibited by federal law from possessing firearms due to his four prior felony convictions. Davis was previously convicted of three felony charges of resisting law enforcement in 2014, 2015 and 2018 and one felony charge of burglary in 2018.
Zachary A. Myers, U.S. Attorney for the Southern District of Indiana, and Daryl S. McCormick, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), Columbus Field Division, made the announcement.
ATF investigated the case in conjunction with the Indianapolis Metropolitan Police Department. The sentence was imposed by U.S. District Judge Sarah Evans Barker. As part of the sentence, Judge Barker ordered that Davis be supervised by the U.S. Probation Office for three years following his release from federal prison.
U.S. Attorney Myers thanked Assistant U.S. Attorney Lawrence D. Hilton who prosecuted this case.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
Former Owner of Tax Preparation Business Found Guilty of Tax CrimeRead the Press Release
A Plano man was convicted at trial of concealing over $1 million in income from the IRS, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.
After three days of trial, on Thursday, a federal jury found Raymond Griggs, 51, guilty of making a false statement on his income tax return.
According to evidence presented at trial, between 2011 and 2013, Mr. Griggs ran a tax preparation business, Griggs Financial, LLC, located in the Dallas, Texas area.
While Griggs Financial, LLC generated over $1.3 million in gross receipts in 2013, Mr. Griggs reported to the IRS that his business had brought in just about $340,000.
That year alone, however, Mr. Griggs spent in excess of $1.4 million, including over $114,000 for entertainment, and tens of thousands of dollars for jewelry, travel, and flight lessons.
Additionally, the evidence presented at trial showed that Mr. Griggs consistently underreported his business’s gross receipts to the IRS by about $1 million for both 2012 and 2011.
Mr. Griggs now faces up to three years in federal prison.
IRS Criminal Investigation’s Dallas Field Office conducted the investigation. Assistant U.S. Attorneys Donna Strittmatter Max, Fabio Leonardi, and Russell Fusco (fmr.) prosecuted the case. U.S. District Judge David C. Godbey presided over the trial.
Former Heads of New York-Based Non-Governmental Organization Charged with Bribing Elected Officials of the Marshall Islands Extradited to the United States from ThailandRead the Press Release
Two Marshall Island nationals, Cary Yan, 50, and Gina Zhou, 34, arrived in the United States today after being extradited from Thailand. Yan and Zhou are charged with allegedly violating the Foreign Corrupt Practices Act (FCPA), money laundering, and conspiracy to commit those offenses in connection with a scheme to bribe elected officials of the Republic of the Marshall Islands (RMI) in exchange for passing certain legislation. They are expected to make their initial court appearance on Sept. 6 before U.S. Magistrate Judge Naomi Reice Buchwald of the U.S. District Court for the Southern District of New York.
“Yan and Zhou allegedly engaged in a multi-year scheme to bribe elected officials in the Marshall Islands and to corrupt the legislative process,” said Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division. “The department is committed to prosecuting individuals who participate in international corruption and undermine the integrity of democratic institutions and the free marketplace.”
On Aug. 10, 2020, Yan and Zhou were charged in a five-count indictment with one count of conspiring to violate the FCPA, two counts of violating the FCPA, one count of conspiring to commit international money laundering, and one count of committing international money laundering. The indictment alleges, beginning in or around 2016 and continuing until at least August 2020, Yan and Zhou, as the president and assistant to the president, respectively, of a New York-based non-governmental organization (NGO), conspired with others in connection with a multi-year bribery and money laundering scheme. Yan and Zhou allegedly offered and paid tens of thousands of dollars in bribes to elected RMI officials – including, among others, members of the RMI legislature – in exchange for supporting legislation creating a semi-autonomous region within the RMI called the Rongelap Atoll Special Administrative Region (RASAR) that would benefit the business interests of the defendants and their associates. The indictment alleges that the defendants carried out the bribery and money laundering scheme using the New York NGO, including the physical use of its headquarters in Manhattan, to meet with and communicate with RMI officials.
“As alleged, Cary Yan and Gina Zhou's bribery scheme was designed to influence and manipulate the legislative process of the Republic of the Marshall Islands in order to benefit themselves and their associates financially,” said U.S. Attorney Damian Williams for the Southern District of New York. “Yan and Zhou's bribes blatantly flouted the sovereignty of the Republic of the Marshall Islands and its legislature, and the dedicated investigative work carried out by this Office and our partners signals that the Southern District of New York will not tolerate those who openly violate the integrity of democratic processes.”
“As alleged, the defendants conducted multiple illegal activities to benefit their personal interests at the expense of the people of the Marshall Islands,” said Assistant Director-in-Charge Michael J. Driscoll of the FBI New York Field Office. “The FBI, along with our global law enforcement partners, is committed to bringing to justice those who seek to use corruption and fraud as a means of doing business - regardless of where in the world they are located.”
On Nov. 17, 2020, Yan and Zhou were arrested in Thailand at the request of the United States pursuant to a bilateral extradition treaty. After extradition proceedings concluded in Thai courts, the Royal Thai Government ordered the defendants’ extradition, which resulted in their arrival in the United States on Sept. 2.
If convicted, Yan and Zhou each face a maximum penalty of 20 years in prison for each count of money laundering and conspiracy to commit money laundering and up to five years in prison for each count of violating the FCPA and conspiring to violate the FCPA. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant Attorney General Polite and U.S. Attorney Williams commended and thanked the Royal Thai Government for its assistance in the extradition of Yan and Zhou to the United States. The Embassy of the United States in Bangkok and the Justice Department’s Office of International Affairs provided substantial assistance in securing the arrest and extradition of the defendants.
The FBI’s New York Field Office investigated the case. The U.S. Marshals Service transported Yan and Zhou from Thailand to the United States.
Assistant Chief Gerald M. Moody, Jr. of the Justice Department’s Fraud Section and Deputy Chief of the Southern District of New York’s Criminal Division Daniel C. Richenthal, Assistant U.S. Attorneys Hagan Scotten, Lara Pomerantz and Derek Wikstrom for the Southern District of New York are prosecuting the case.
The Criminal Division’s Fraud Section is responsible for investigating and prosecuting all FCPA matters. Additional information about the department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Former Employee of Telecommunications Company Charged for Large-Scale Mobile Phone Unlocking SchemeRead the Press Release
NEWARK, N.J. – A former telecommunications company employee was charged for his role in a scheme to fraudulently unlock the Subscriber Identification Module (SIM) cards of thousands of mobile phones, U.S. Attorney Philip R. Sellinger announced today.
Richard Forrest Sherman, 43, of previously of Salem, Oregon, and now Boerne, Texas, is charged by complaint with wire fraud conspiracy in Newark federal court. He was arrested today in Texas, had his initial court appearance before U.S. Magistrate Judge Henry Bemporad in federal court in the Western District of Texas, and was released on $30,000 unsecured bond.
According to documents filed in this case and statements made in court:
Sherman worked at a multinational telecommunications company. While there, he managed an account for a customer that received an exemption to unlock the SIM cards of mobile devices. Sherman exploited this exemption by creating a series of customer accounts within the carrier’s system to make the accounts look like an affiliate company of the customer that actually received the exemption. Sherman and others then submitted bulk unlocking requests through these fake affiliate accounts that Sherman set up before leaving the telecommunications company.
Sherman, through his entities, received payment from others in exchange for causing the fake affiliate accounts to successfully send International Mobile Equipment Identity (IMEI) numbers in bulk to the carrier. The carrier, believing that the fake affiliate company was entitled to the unlocking exception, unlocked these IMEIs in bulk. Unlocking these IMEIs permitted others involved in the scheme to resell the phones for profit – the phones would have otherwise remained locked or required payment of a fee to be unlocked. Sherman set up the fake affiliate accounts in or around 2013; he and his conspirators exploited the fraud scheme until it was discovered in August 2020.
The wire fraud conspiracy count is punishable by a maximum of 20 years and a fine of $250,000 or twice the pecuniary gain to the defendant or loss to the victims, whichever is greatest.
U.S. Attorney Sellinger credited special agents of the U.S. Secret Service’s Seattle Field Office, under the direction of Special Agent in Charge Robert Canestrari, with the investigation leading to the charge.
The government is represented by Assistant U.S. Attorney Jamie L. Hoxie of the Cybercrime Unit in Newark.
The charge and allegations contained in the complaint are merely accusations and the defendant is presumed innocent unless and until proven guilty.
Former Deputy Warden at Mississippi State Penitentiary at Parchman Sentenced to Prison for Assaulting InmateRead the Press Release
Melvin Hilson, 50, a former deputy warden at the Mississippi State Penitentiary at Parchman, was sentenced to 24 months in prison and three years of supervised release for violating an inmate’s civil rights in 2016. On May 26, Hilson pleaded guilty in federal court to willfully depriving an inmate of his constitutional right to be free from cruel and unusual punishment by repeatedly striking the inmate and knocking him to the ground, which resulted in the inmate suffering a ruptured eardrum, abrasions to his ear and neck and prolonged headaches.
“This defendant abused his position as a corrections officer by unlawfully assaulting an inmate in his custody,” said Assistant Attorney General Kristen Clarke for the Justice Department’s Civil Rights Division. “This defendant violently assaulted the victim and violated the trust that we place in corrections officials to lawfully carry out their duties. The Civil Rights Division will continue to vigorously enforce our civil rights laws and hold jail and prison officials who break the law accountable.”
“This prosecution and sentence demonstrate our commitment to ensuring that every person’s civil rights are protected under the Constitution, and corrections officials who abuse their position are not above the law that they have sworn to uphold,” said U.S. Attorney Clay Joyner for the Northern District of Mississippi.
According to court documents and statements made in court, Hilson was working as a member of Parchman’s K-9 Unit at the time of the assault. On or around Aug. 3, 2016, J.T., an inmate at Parchman, was in a caged area inside of the medical unit, where he waited to be seen by a medical provider. Hilson approached J.T. and struck him several times, knowing that there was no reason to use force and that J.T. did not pose any threat to himself or others. During the assault, Hilson knocked J.T. to the ground, picked him up, and then struck him and knocked him to the ground again. According to prosecutors, J.T. did not attempt to fight back or defend himself from Hilson’s assault. Following the assault, Hilson falsified a report to conceal his unlawful actions and lied to Mississippi Department of Corrections investigators about his conduct.
The FBI Jackson Field Division investigated this case. Special Litigation Counsel Samantha Trepel and Trial Attorney Cameron A. Bell of the Civil Rights Division and Assistant U.S. Attorneys Kimberly Hampton and Robert Mims for the Northern District of Mississippi prosecuted the case.
Former Deputy Warden at Mississippi State Penitentiary at Parchman Sentenced to Prison for Assaulting InmateRead the Press Release
WASHINGTON – Melvin Hilson, 50, a former deputy warden at the Mississippi State Penitentiary at Parchman, was sentenced to 24 months in prison and three years of supervised release for violating an inmate’s civil rights in 2016. On May 26, Hilson pleaded guilty in federal court to willfully depriving an inmate of his constitutional right to be free from cruel and unusual punishment by repeatedly striking the inmate and knocking him to the ground, which resulted in the inmate suffering a ruptured eardrum, abrasions to his ear and neck and prolonged headaches.
“This defendant abused his position as a corrections officer by unlawfully assaulting an inmate in his custody,” said Assistant Attorney General Kristen Clarke for the Justice Department’s Civil Rights Division. “This defendant violently assaulted the victim, and violated the trust that we place in corrections officials to lawfully carry out their duties. The Civil Rights Division will continue to vigorously enforce our civil rights laws and hold jail and prison officials who break the law accountable.”
“This prosecution and sentence demonstrate our commitment to ensuring that every person’s civil rights are protected under the Constitution, and corrections officials who abuse their position are not above the law that they have sworn to uphold,” said U.S. Attorney Clay Joyner for the Northern District of Mississippi.
According to court documents and statements made in court, Hilson was working as a member of Parchman’s K-9 Unit at the time of the assault. On or around Aug. 3, 2016, J.T., an inmate at Parchman, was in a caged area inside of the medical unit, where he waited to be seen by a medical provider. Hilson approached J.T. and struck him several times, knowing that there was no reason to use force and that J.T. did not pose any threat to himself or others. During the assault, Hilson knocked J.T. to the ground, picked him up, and then struck him and knocked him to the ground again. According to prosecutors, J.T. did not attempt to fight back or defend himself from Hilson’s assault. Following the assault, Hilson falsified a report to conceal his unlawful actions and lied to Mississippi Department of Corrections investigators about his conduct.
The FBI Jackson Field Division investigated this case. Special Litigation Counsel Samantha Trepel and Trial Attorney Cameron A. Bell of the Civil Rights Division and Assistant U.S. Attorneys Kimberly Hampton and Robert Mims of the Northern District of Mississippi prosecuted the case.
Former Children's Museum Director Pleads Guilty to Distributing Child PornographyRead the Press Release
Vanessa Roberts Avery, United States Attorney for the District of Connecticut, today announced that ROBERT ECKERT, 56, of West Hartford, pleaded guilty yesterday before U.S. District Judge Stefan R. Underhill in Bridgeport to distribution of child pornography.
According to court documents and statements made in court, Eckert used multiple internet platforms, including MeWe and Kik, to solicit, receive and distribute images of child sexual abuse and to communicate with others about the distribution of child pornography. He accessed the online platforms on his phone, at his residence, and at the Lutz Children’s Museum in Manchester where he was employed as its executive director. Between September 2019 and May 2020, Eckert possessed 1,837 image files and 73 videos depicting child sex abuse, including the abuse of prepubescent minors.
Eckert was arrested on April 8, 2021.
Judge Underhill scheduled sentencing for November 28, at which time Eckert faces a mandatory minimum term of imprisonment of five years and a maximum term of imprisonment of 20 years.
Eckert is released on a $100,000 bond pending sentencing.
This matter has been investigated by Homeland Security Investigations (HSI), with the assistance of the Connecticut State Police and the Manchester Police Department. The case is being prosecuted by Assistant U.S. Attorneys Nancy V. Gifford and Daniel Cummings.
This prosecution is part of the U.S. Department of Justice’s Project Safe Childhood Initiative, which is aimed at protecting children from sexual abuse and exploitation. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
To report cases of child exploitation, please visit www.cybertipline.com.
Florissant man sentenced to 14+ years on gun, drug chargesRead the Press Release
ST. LOUIS – U.S. District Judge Rodney W. Sippel on Thursday sentenced a man from Florissant, Missouri to 14 years and three months in prison on drug and gun charges.
The investigation into Deandre J. White began with the fatal shooting of a 6-year-old boy in St. Louis on Feb. 22, 2020, during which White was identified as a suspect, according to a sentencing memorandum filed in court. The boy’s 9-year-old sister was also shot and wounded. The investigation revealed that White was heavily involved in selling fentanyl and guns, the memo says.
Over the course of approximately five months, undercover investigators bought over 30 grams of fentanyl and three firearms, including two high-powered, large capacity rifles and one pistol with an extended magazine. The defendant was also spotted driving at least two stolen vehicles during the drug transactions.
On social media, White boasted about selling drugs and being a shooter and posted pictures of himself with cash and firearms.
White also faces a pending charge in St. Louis County Circuit Court, where he is accused of shooting two people and three vehicles at his former girlfriend’s apartment complex, the sentencing memo says.
“Investigators were unable to recover the murder weapon, but followed the evidence and were able to prove beyond a reasonable doubt that Deandre White was selling a highly dangerous drug on the streets of St. Louis and equally dangerous firearms,” said U.S. Attorney Sayler Fleming. “The investigation resulted in a significant prison sentence, and while state and federal investigators are eager for additional information about the shooting of a kindergartner and his sister, the community will be safer because of the joint efforts of investigators,” she said.
White, now 26, was originally charged by complaint on Aug. 12, 2020 and indicted by a grand jury on Aug. 27, 2020. He pleaded guilty in May to two counts of being a felon in possession of a firearm, one count of possession of fentanyl with intent to distribute and two counts of possession of a firearm in furtherance of a drug trafficking crime.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the St. Louis Metropolitan Police Department. Assistant U.S. Attorney Catherine Hoag prosecuted the case.
Anyone with information about White or the shooting should contact the police homicide division at 314-444-5371, or report information anonymously via CrimeStoppers at 866-371-8477.
Federal Grand Jury Indicts New Orleans Man for Being a Felon in Possession of a FirearmRead the Press Release
NEW ORLEANS, LOUISIANA – NEWMAN HOOKER, age 29, a resident of New Orleans, Louisiana, was charged on September 1, 2022 in a one-count indictment for being a convicted felon in possession of a firearm.
If convicted, HOOKER faces up to ten (10) years imprisonment, followed by up to three (3) years of supervised release, up to a $250,000.00 fine, and a mandatory special assessment fee of $100.00.
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.
U.S. Attorney Evans reiterated that the indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
The case was investigated by the New Orleans Police Department, the Orleans Parish District Attorney’s Office, and the Federal Bureau of Investigation. Assistant United States Attorneys Rachal Cassagne and David Berman are in charge of the prosecution.
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Federal Grand Jury Indicts Man for Gun and Drug OffensesRead the Press Release
NEW ORLEANS, LOUISIANA – U.S. Attorney Duane A. Evans announced that EDDIE HARRIS, age 38, a resident of New Orleans, Louisiana, was charged on September 1, 2022 in a three-count indictment by a Federal Grand Jury for violations of the Federal Gun Control and Controlled Substances Acts.
HARRIS is charged in Count 1 with possession with intent to distribute a quantity of a substance containing a detectable amount of cocaine, in violation of Title 21, United States Code, Sections 841(a)(1) and (b)(1)(C). In Count 2, HARRIS is charged with possession of a firearm in furtherance of a drug trafficking crime, in violation of Title 18, United States Code, Section 924(c)(1)(A). In Count 3, HARRIS is charged with possession of a firearm by a convicted felon, in violation of Title 18, United States Code, Section 922(g)(1).
If convicted of Count 1, HARRIS faces a maximum sentence of 20 years imprisonment, up to a $1,000,000 fine, and at least three years of supervised release. If convicted of Count 2, HARRIS faces a mandatory minimum sentence of 5 years up to life imprisonment, which is to run consecutively to all other sentences, up to a $250,000 fine, and up to 5 years of supervised release. If convicted of Count 3, HARRIS faces a maximum term of imprisonment of 15 years, up to a $250,000 fine, and up to three years of supervised release. For each conviction, HARRIS must pay a mandatory special assessment fee of $100.
U. S. Attorney Evans reiterated that the indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and gun violence, and to make our neighborhoods safer for everyone. On May 26, 2021, the Department launched a violent crime reduction strategy strengthening PSN based on these core principles: fostering trust and
legitimacy in our communities, supporting community-based organizations that help prevent violence from occurring in the first place, setting focused and strategic enforcement priorities, and measuring the results.
The case was investigated by the New Orleans Police Department and the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney David Berman.
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Federal Grand Jury Indicts Lafourche Parish Man for Violating the Federal Controlled Substances ActsRead the Press Release
NEW ORLEANS, LOUISIANA – On September 1, 2022, a federal grand jury in New Orleans, Louisiana returned a one-count indictment charging a man for violating the Federal Controlled Substances Act announced U.S. Attorney Duane A. Evans
According to court documents, TERRANCE STEWART, age 31, is charged in Count 1 with possession with intent to distribute 40 grams or more of a mixture or substance containing a detectable amount of fentanyl, in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(B).
If convicted of Count 1, STEWART faces a mandatory minimum sentence of 5 years, up to a maximum of 40 years imprisonment, a fine of up to $5,000,000, at least 4 years of supervised release, and a mandatory special assessment fee of $100.
U.S. Attorney Evans reiterated that the indictment is merely a charging document and that the guilt of the defendants must be proven beyond a reasonable doubt.
This case was investigated by the Drug Enforcement Administration, New Orleans Division and Lafourche Parish Sheriff’s Office Drug Task Force. The prosecution of this case is being handled by Assistant United States Attorney Christopher Usher.
Enlisted Sailor Stationed in Belle Chasse, Louisiana Pleads Guilty, Admits Producing Files Depicting the Sexual Victimization of Children, Including Through ExtortionRead the Press Release
NEW ORLEANS – U.S. Attorney Duane A. Evans announced that BIAGIO WILLIAM AMBROSINO, age 20, originally from Queens, NY, who was an enlisted sailor stationed in Belle Chasse, Louisiana, pleaded guilty on September 1, 2022 before United States District Judge Wendy B. Vitter after previously being charged by a federal grand jury for producing images and videos depicting the sexual exploitation of children, in violation of Title 18, United States Code, Section 2251(a) (Count 1) and transmitting interstate threats for the purpose of extorting a thing of value, in violation of Title 18, United States Code, Section 875(b) (Count 2).
According to court documents, the charges stem from AMBROSINO’S implementation of an exploitation and extortion scheme to convince individuals to send him sexually explicit content between August 2020 and January 2022. AMBROSINO utilized several different strategies depending on victims’ ages, cognitive ability, level of compliance, and his previous knowledge of them. For individuals he knew, AMBROSINO would, anonymously, either prey on their friendship or use information he already had about the individuals and their families to obtain sexually explicit depictions from them. For individuals he did not already know, AMBROSINO would utilize other measures. For example, AMBROSINO would contact some minors via social media direct message, purport to be a social media mogul, and inquire whether the minor wanted “to be Instagram famous.” He would then request a sexually suggestive or sexually explicit photograph to prove that the minor was serious about being famous or receiving a gift. Alternatively, AMBROSINO would offer items of value to minors, including a camera, a lighting system, sponsorship, or stuffed animals as enticements to take and send him sexually explicit pictures and videos or to engage in sexually explicit conduct while on a video chat with him. When victims expressed reluctance to provide him sexually explicit depictions or to continue doing so, AMBROSINO would extort them by threatening reputational harm or physical violence. Once AMBROSINO successfully obtained sexually explicit content from a victim, he continued to demand increasingly explicit, invasive, and humiliating content from his victims. Thereafter, AMBROSINO transmitted some of the sexually explicit depictions he obtained to other individuals in exchange for the identities of other, future potential victims.
In pleading guilty, AMBROSINO admitted to victimizing at least eleven people, including nine minors ranging in age from ten to seventeen years old, one of whom had a diagnosed developmental cognitive disability and a speech disability. The identified victims were residents of eight different states and the country of Australia.
AMBROSINO faces a mandatory minimum term of imprisonment of fifteen (15) years and a maximum term of imprisonment of thirty (30) years as to Count 1, and a maximum term of imprisonment as to Count 3 of twenty (20) years. AMBROSINO also faces a mandatory minimum of five years, up to a lifetime of supervised release after his prison term, up to a $250,000 fine, and he may be required to register as a sex offender. Finally, he faces a mandatory special assessment fee of $100 per count.
Sentencing before Judge Vitter has been scheduled for December 6, 2022.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
U.S. Attorney Evans praised the work of the Naval Criminal Investigative Service (NCIS) in investigating this matter, with assistance from the New York Police Department. Assistant United States Attorney Jordan Ginsberg is in charge of the prosecution.
East Bay Man Sentenced to 51 Months in Federal Prison for Armed Robbery of U.S. Mail CarrierRead the Press Release
OAKLAND – Kevin Allan Fowler was sentenced today to 51 months in federal prison for the armed robbery of a United States Postal Service letter carrier, announced United States Attorney Stephanie M. Hinds and U.S. Postal Inspection Service (USPIS) San Francisco Division Acting Inspector-In-Charge Kevin Rho. The sentence was handed down by United States District Judge Haywood S. Gilliam Jr.
Fowler, 31, a resident of the East Bay, was charged by federal information on April 13, 2022, with the armed robbery of a mail carrier that occurred on Merritt Avenue in Oakland on December 2, 2021. The charge alleged that Fowler used a pistol in the robbery.
On June 15, 2022, Fowler entered a plea agreement and pleaded guilty to the armed robbery. In his plea agreement, Fowler admitted that on December 2, 2021, he walked past a letter carrier while she was approaching a building to deliver mail. He then returned and approached the letter carrier. Fowler demanded that she turn over her keys. When she refused, Fowler admits he took out and brandished a handgun. The letter carrier then handed over her vehicle keys and two USPS keys. Fowler fled.
The government described in its sentencing memo that Fowler’s vehicle was identified through surveillance footage and stopped days later by Oakland Police Department officers. When arrested, Fowler had a loaded P80 9mm magazine and a counterfeit USPS mail key. The keys stolen from the victim letter carrier were not recovered, but the victim was able to identify Fowler has the perpetrator of the robbery.
In addition to the 51 month sentence, United States District Judge Gilliam ordered Fowler to serve a five year period under supervision when he leaves prison and to pay restitution to the victim. Fowler was in custody at his sentencing hearing and begins serving his prison sentence immediately.
Evan Mateer is the Assistant U.S. Attorney who is prosecuting the case, with the assistance of Christine Tian and Soana Katoa. The prosecution is the result of an investigation by the USPIS and Oakland Police Department.
EDVA Observes Overdose Awareness WeekRead the Press Release
ALEXANDRIA, Va. – This week the U.S. Attorney’s Office for the Eastern District of Virginia (EDVA) recognized Overdose Awareness Week and renewed its commitment to addressing the nation’s overdose epidemic.
“Over 107,000 people died of a drug overdose in the United States last year. That is more than twice the number of people who were killed by firearms,” said U.S. Attorney Jessica D. Aber. “In Virginia, more people died of a drug overdose than by firearm and car accidents combined. We must raise awareness of what is killing our loved ones at such an alarming rate.”
Overdose Awareness Week, observed from August 29 through September 3, is a time to remember those tragically lost to overdose and the pain of the families who are left behind. On Wednesday, the flags around Virginia flew at half-staff in recognition of the lives lost to overdose. This week is also an opportunity to recommit to working together to build safe, healthy, and resilient communities. By adopting evidence-based approaches to reducing overdose risks and lowering barriers to treatment and support, we can save more American lives.
According to the CDC, in 2021 there was a 15 percent rise in the rate of overdose deaths in the United States. The death rate for 2022 is on track to be even higher. Opioids were responsible for almost 75 percent of the overdose deaths in 2020 – and the primary driver of those deaths was illicit fentanyl, the synthetic opioid most commonly found in counterfeit pills bought on the street. According to the CDC, across the U.S., law enforcement has seized everything from fake blue 30mg Oxycodone pills, to fake Adderall and Xanax pills which contain illicitly made fentanyl. Recently, law enforcement have begun seizing multicolored pills that look like candy made with illicit fentanyl. Within Virginia, a recent trend of cocaine laced with fentanyl has caused a number of overdoses. Overdose deaths within the state from methamphetamine are also on the rise. Law enforcement seizures in and around the district have included what appear to be Ecstasy pills made with high-purity methamphetamine.
In addition to prosecuting offenders who distributed illicit substances, EDVA leads a number of on-going programs and efforts to raise awareness and find solutions to the overdose pandemic, including the Central Virginia Overdose Working Group, Project Recover, and the “Silent No More” awareness program for schools, parents, and community organizations.
The Central Virginia Overdose Working Group (CVOWG) is comprised of over 330 stakeholders from 14 disciplines. It was created to eliminate the siloed structure of the substance use arena by bringing experts from multiple fields together to discuss issues, identify gaps, and develop solutions to the overdose epidemic in Central Virginia.
Project Recover funds Certified Peer Recovery Specialists to support Virginians suffering with substance use disorders during one of the most critical times in their path to recovery – immediately following an overdose. All too often, once EMS and law enforcement have addressed the immediate trauma of an overdose incident and have left the scene to respond to the next call from the community, the victim is left without sustainable treatment and recovery options. Project Recover’s goal is to help fill this gap by providing individuals in need with immediate support from a peer who has overcome similar challenges and has gained real-world knowledge of the ongoing process of treatment and recovery. Currently, Project Recover funds peers in Richmond City Police Department, Chesterfield County Police Department, Henrico Fire/EMS and Police Department, and Richmond Ambulance Authority.
“Silent No More” is a community-based educational outreach and prevention program. This program is being introduced at schools in the Eastern District of Virginia to educate students and parents about the threat of opioids and other dangerous substances, as well as connecting law enforcement with parents, medical professionals, and educators for life-saving conversations. “Silent No More” is currently available in Central Virginia and in Tidewater and is in the process of developing a program in Northern Virginia.
If you or your organization would like to participate in the Working Group or would like to have the “Silent No More” team present to your school or organization, please contact Kim Ulmet at [email protected].
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia.
District Man Sentenced to 78 Months in Prison for Schemes to Defraud Small Business Pandemic Relief Programs Relief Programs and the Archdiocese of WashingtonRead the Press Release
WASHINGTON – Kenneth Gaughan, 44, of Washington, D.C., was sentenced today to 78 months in prison for carrying out a series of financial schemes. In one, he embezzled more than $438,000 from the Catholic Archdiocese of Washington, D.C., where he was previously employed as Assistant Superintendent. In the other, he fraudulently obtained more than $2.1 million in federal Paycheck Protection Program (PPP) loans and Economic Injury Disaster Loans (EIDL).
The announcement was made by U.S. Attorney Matthew M. Graves, Darrell Waldon, Special Agent in Charge of the Internal Revenue Service-Criminal Investigation, Washington, D.C. Field Office, Thomas J. Sobocinski, Special Agent in Charge of the FBI’s Baltimore Field Office, and Amaleka McCall-Brathwaite, Special Agent in Charge of the U.S. Small Business Administration, Office of the Inspector General, Eastern Region.
Gaughan, who used the alias of Richard Strauski, pleaded guilty on March 2, 2022, in the U.S. District Court for the District of Columbia to three counts: one count of wire fraud and one count of money laundering in the PPP and EIDL case, and one count of wire fraud in the case involving the Archdiocese. He was sentenced by the Honorable Tanya S. Chutkan. Following his prison term, he will be placed on three years of supervised release. He also must pay restitution, and the amount will be determined at a later date.
“For a decade, Kenneth Gaughan stole money meant to help needy people, businesses, and organizations, starting with a scheme defrauding his own employer and later looting government COVID-relief efforts,” said U.S. Attorney Graves. “He went to great lengths to conceive, carry out, and conceal his crimes. Now, he will be facing the consequences of his greed with confinement in a federal prison.”
“Kenneth Gaughan is facing the consequences for defrauding his employer for years and then enriching himself with taxpayer funds meant to help businesses and employees at a time of crisis,” said IRS-CI Special Agent in Charge Waldon. “Instead of enjoying his ill-gotten yacht, new car and home, he will now be serving his sentence in prison thanks to our IRS-CI and law enforcement partner investigators. We will continue to pursue CARES Act fraud and bring these criminals to justice.”
“This sentence demonstrates the FBI’s commitment to hold accountable those who attempt to defraud pandemic-related assistance programs designed to aid businesses and employees in these challenging times,” said FBI Special Agent in Charge Sobocinski. “We will continue to collaborate with our partners to combat this self-serving type of fraud. I want to thank our partners at the Internal Revenue Service-Criminal Investigation and the U.S. Small Business Administration, Office of the Inspector General, for their efforts in bringing Kenneth Gaughan to justice.”
“Those that commit fraud against SBA’s programs will be brought to justice and held accountable,” said SBA OIG’s Special Agent in Charge McCall-Brathwaite. “OIG remains committed to rooting out bad actors and protecting the integrity of SBA programs every day. I want to thank the U.S. Department of Justice and our law enforcement partners for their dedication and pursuit of justice.”
Scheme Involving the Archdiocese of Washington:
In his guilty plea, Gaughan admitted defrauding the Archdiocese of Washington of more than $438,000. Gaughan began working for the Archdiocese as its Director of Counseling in 2008 and was later promoted to Assistant Superintendent. In his role, Gaughan was responsible for recruiting and acting as the point of contact for contractors who provided various services to the Archdiocese. These included contractors that could help the Archdiocese implement anti-bullying, crisis intervention, and professional development programs at the approximately 95 Catholic schools overseen by the Archdiocese in Maryland and Washington, D.C. Gaughan also obtained invoices for services from contractors and provided those invoices, along with requests for payment and supporting documentation, to his superiors for approval.
Beginning in at least June 2010 and continuing through April 2018, Gaughan caused the Archdiocese to pay invoices manufactured by Gaughan purportedly for anti-bullying and crisis intervention programs, as well as for software used to send mass messages to Archdiocese students and families. To execute the scheme, Gaughan concealed his ownership and control of three companies, including by submitting forms using an alias. Gaughan then transmitted fraudulent invoices for these companies and persuaded the Archdiocese to issue checks for services that Gaughan knew the companies did not provide as represented. Gaughan opened virtual and private mailboxes to receive the checks issued to pay for the fraudulent invoices. He deposited the checks into the bank accounts he controlled and converted the money to his personal use.
Scheme Involving Government Programs:
According to court documents, Gaughan subsequently carried out his scheme targeting federal funds from at least March 2020 through August 2020. The PPP loans were created through the Coronavirus Aid, Relief, and Economic Security (CARES) Act. These forgivable loans were to be used by businesses and organizations for payroll costs, interest on mortgages, rent and utilities. The EIDL loans, part of a program run by the Small Business Administration, also were designed to help businesses and organizations facing hardship.
In Gaughan’s case, he used funds from the two programs, in part, to purchase a $300,000 yacht, a $1.13 million rowhouse, and a $46,000 luxury sports sedan.
According to the government’s evidence, in the course of his scheme, Gaughan sought over $2.7 million in PPP loans on behalf of nine companies. Some of the applications were submitted in his own name, and others were in the name of another individual. Gaughan received approximately $2.1 million in PPP and EIDL funds through applications to SBA lenders for the companies, which falsely purport to register emotional support animals. Gaughan made false representations to receive the loan funds, including forged paperwork and bank records.
Gaughan then used a portion of the loan proceeds to purchase a 2020 Cruisers Yachts 338 CX 33-foot watercraft, a 2020 Kia Stinger, and a rowhouse in Northeast Washington.
Gaughan was arrested in both cases on Aug. 11, 2020.
At the time of Gaughan’s arrest, the government obtained a warrant authorizing the seizure of the yacht, the Kia Stinger, Gaughan’s investment account, and Gaughan’s bank accounts. The government also filed a civil forfeiture complaint against the home Gaughan purchased with his fraudulently obtained proceeds. Additionally, the government filed a lis pendens on that property to give proper notice of the forfeiture litigation and to prevent the sale of the property prior to the resolution of this case.
The matter involving the Archdiocese of Washington was investigated by the FBI. The PPP and EIDL matters were investigated by the IRS-CI, FBI, and SBA-OIG.
The cases were prosecuted by Assistant U.S. Attorney Christine Macey of the Fraud, Public Corruption, and Civil Rights Section of the U.S. Attorney’s Office for the District of Columbia; Assistant U.S. Attorney Jessica Collins of the U.S. Attorney’s Office for the District of Maryland; and Assistant U.S. Attorney Greg Bernstein, formerly of the U.S. Attorney’s Office for the District of Maryland. They were supported by Paralegal Specialists Michon Tart and Quiana Dunn-Gordon, Victim-Witness Advocate Yvonne Bryant, and Supervisory Litigation Technology Specialist Leif Hickling. The seizure and forfeiture matters were handled by Assistant U.S. Attorney Arvind Lal, former Special Assistant U.S. Attorney Matthew Grisier, former Special Assistant U.S. Attorney Steven Brantley, and Senior Attorney Advisor James S. Alexander of the Justice Department’s Money Laundering and Asset Recovery Section.
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On May 17, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
Anyone with information about allegations of fraud related to COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
District Man Sentenced to 14 Years in Prison for Killing Man Stopped at Traffic LightRead the Press Release
WASHINGTON – Barry Marable, 26, of Washington, D.C., was sentenced today to 14 years in prison for firing a gun in a busy area of Northeast Washington and fatally wounding a 22-year-old man whose car was stopped at a traffic light.
The announcement was made by U.S. Attorney Matthew M. Graves and Robert J. Contee III, Chief of the Metropolitan Police Department (MPD).
Marable pleaded guilty on Nov. 19, 2021, in the Superior Court of the District of Columbia, to a charge of voluntary manslaughter while armed. He was sentenced by the Honorable Neal E. Kravitz. Following his prison term, Marable will be placed on five years of supervised release.
According to the government’s evidence, on Oct 24, 2018, just before 6 p.m., the victim, Roger Thomson Marmet, known as Tom to his family and friends, was driving home from a job with the non-profit So Others Might Eat (SOME). Mr. Marmet was driving down 17th Street NE and stopped for a light at 17th and Bladensburg Road NE.
Marable, meanwhile, was in the same area. He saw a man at a nearby gas station who he believed had assaulted him about one week earlier. Marable removed a firearm from his pocket and pointed it towards the gas station. He fired four times from an alley – with two sidewalks and four lanes of traffic between him and the other man, who was unarmed. One of these shots struck Mr. Marmet, who died less than an hour later. No one else was hit by the gunfire.
Marable was arrested on Dec. 28, 2018. He has been in custody ever since.
In announcing the sentence, U.S. Attorney Graves and Chief Contee commended the work of those who investigated the case from the Metropolitan Police Department. They also expressed appreciation for the work of those who handled the case at the U.S. Attorney’s Office, including Deputy Chief Sharon Donovan, of the Office’s Homicide Section, Victim/Witness Advocate Jennifer Clark, and Paralegal Specialist Stephanie Gilbert, Finally, they commended the efforts of Assistant U.S. Attorneys Kimberley C. Nielsen and Gauri Gopal, who investigated and prosecuted the case.
Davenport Man Found Guilty of Being a Felon in Possession of a Firearm Related to a 2021 Shooting and Tampering with a WitnessRead the Press Release
DAVENPORT, IA – On August 31, 2022, a federal jury found Roylee Richardson, Jr., age 32, of Davenport, guilty of being a felon in possession of a firearm and two counts of tampering with a witness.
According to court documents and evidence presented at trial, at approximately 11:00 a.m. on February 7, 2021, officers from the Davenport Police Department were dispatched to an apartment complex at 3348 Heatherton Drive, in Davenport, related to shots fired. At the scene, officers located a shell casing, a spent slug, and two bullet fragments. Richardson was identified as the shooter, and officers subsequently located Richardson attempting to scale off a second-story balcony. Officers then located a loaded pistol inside of the apartment that Richardson had fled from. Ballistics testing confirmed that the firearm recovered was used to shoot the shell casing, spent slug, and one of the bullet fragments located. After being arrested, Richardson repeatedly called the victim, in violation of a no contact order, and in an attempt to tamper with the witness.
This is Richardson’s third conviction related to a shooting. In November 2008, Richardson was convicted of Willful Injury Resulting in Bodily Injury and Intimidation with a Dangerous Weapon, in the Iowa District Court for Scott County. In July 2016, Richardson was convicted of Intimidation with a Dangerous Weapon with Intent, Possession of a Firearm or Offensive Weapon by a Felon, Willful Injury Resulting in Bodily Injury, and Going Armed with Intent, in the Iowa District Court for Scott County.
The federal conviction for felon in possession of a firearm is punishable by a term of imprisonment not to exceed 10 years. The convictions for tampering with a witness are each punishable by terms of imprisonment not to exceed 20 years. Richardson is scheduled to be sentenced in federal court on January 24, 2023.
U.S. Attorney Richard D. Westphal of the Southern District of Iowa made the announcement.
This case was investigated by the Davenport Police Department. 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. In May 2021, the Department of Justice 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.
Convicted Felon Found Guilty on Drug and Gun ChargesRead the Press Release
ANNISTON, Ala. – A federal jury this week convicted a New York resident on drug and gun charges, announced U.S. Attorney Prim F. Escalona and Bureau of Alcohol, Tobacco, Firearms, and Explosives Special Agent in Charge Mickey French.
The jury returned its guilty verdict against Jerrelle Quintrez Gladden, 38, after two days of testimony before U.S. District Court Judge Corey L. Maze. Gladden was convicted of possession with intent to distribute 5 grams or more of methamphetamine, possession of a firearm in furtherance of a drug crime, and felon in possession of a firearm.
“Citizens should feel safe in their communities, families should feel safe in their homes, and children should feel safe while playing in their backyards,” U.S. Attorney Escalona said. “Gladden committed serious crimes which could have resulted in the loss of life. He now faces serious penalties. I want to commend the ATF, 7th Judicial Major Crimes Unit, the Anniston Police Department, and the prosecution team for their work on this case.”
”There is one less criminal off of our streets,” SAC French said. “We at ATF work tirelessly to keep our communities safe from people who endanger our neighborhoods. We will continue to work collaboratively with all of our law enforcement partners to combat violent crimes in an effort to maintain public safety.”
According to evidence presented at trial, in January 2020, law enforcement officers executed a state search warrant on a residence in Anniston. Police officers searched the house and found Gladden, a convicted felon, in a bedroom where officers also found digital scales with white crystal-like residue, small plastic baggies consistent with distribution, Gladden’s personal items, and 2 baggies of methamphetamine. Behind the door in the bedroom next to Gladden’s room, officers found a folded chair that contained a clear baggie of methamphetamine, a brown paper bag of U.S. currency, and two loaded firearms: a Sig Sauer 9mm pistol, and a Taurus .380 caliber pistol. The Sig Sauer was reported stolen 8 days prior to finding it during the execution of the search warrant.
The penalty for possession with intent to distribute more than 5 grams of methamphetamine is not less than 5 years, but not more than 40 years. However, the jury also found in Phase II of the trial that Gladden had been previously convicted of a serious drug felony, which enhances his punishment for this charge to not less than 10 years but no more than life in prison. The minimum penalty for possession of a firearm during a drug trafficking crime is five years in prison, which must run consecutive to any other sentence. The maximum penalty for possession of a firearm by a convicted felon is 10 years.
The ATF investigated the case along with the 7th Judicial Major Crimes Unit and the Anniston Police Department. Assistant U.S. Attorneys Brittney Plyler and Kristy Peoples are prosecuting the case.
Consultant Pleads Guilty to Providing Bribes to Public Officials to Benefit ClientsRead the Press Release
CHICAGO — A consultant pleaded guilty in federal court today to offering and providing bribes to public officials in an effort to benefit his clients.
ROBERTO CALDERO, 69, of Chicago, pleaded guilty to one count of wire fraud. The conviction is punishable by up to 20 years in federal prison. U.S. District Judge Steven C. Seeger set sentencing for Dec. 15, 2022.
The guilty plea was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Ashley T. Johnson, Acting Special Agent-in-Charge of the Chicago Field Office of the FBI. The Chicago Public Schools Office of Inspector General participated in the investigation. The government is represented by Assistant U.S. Attorney Michelle Kramer.
Caldero admitted in a plea agreement that in 2016 he offered and arranged for bribes to be provided to a City of Chicago alderman and a Chicago Public Schools employee in exchange for them taking official actions to benefit Caldero’s clients, who were seeking a custodial services contract at CPS, an honorary street name designation in Chicago, and the renaming of a parcel of property believed to be a Chicago Park District park. The benefits Caldero offered the CPS employee included the prospect of future employment, champagne, discounted event space for a family event, and admission to an annual benefit for a museum. To influence the alderman, Caldero arranged for campaign contributions to be made to political organizations affiliated with the alderman or his ward. Unbeknownst to Caldero, the alderman was cooperating with the FBI.
Colorado Springs Man Sentenced for Drug Trafficking and Money LaunderingRead the Press Release
DENVER – The U.S. Attorney’s Office for the District of Colorado announces Armando DeLeon, age 51, of Colorado Springs, was sentenced to 62 months in prison for distribution of cocaine and money laundering. DeLeon previously pled guilty on August 24, 2021.
According to the filed information and the stipulated facts in the plea agreement, DeLeon sold approximately three kilograms of cocaine to a confidential informant through a series of transactions from various locations, including his personal residence, between approximately July 26, 2017, and September 15, 2017. During a search warrant of DeLeon’s residence executed on October 3, 2017, a Panther Arms AR-15-style rifle and two pistols were located, along with over $27,000 cash. The defendant was prohibited from possessing firearms as a result of a prior felony conviction.
Analysis of the defendant’s bank records show DeLeon maintained a credit card in the name of his business, D&D Detailing. While DeLeon told investigators the business was shut down earlier in 2017, the credit card showed spending activity between July and October. DeLeon acknowledged making a $7,000 payment on this credit card account in July 2017 that, at least in part, included proceeds from DeLeon’s drug trafficking activity.
U.S. District Court Judge William J. Martinez sentenced the defendant on August 31, 2022.
“We appreciate our law enforcement partners identifying and investigating this case,“ said U.S. Attorney Cole Finegan. “The fact that this drug dealer is going to spend several years in federal prison should serve as a warning to others who think they can get away with this kind of illegal activity.”
“This sentencing is a great example of the combined law enforcement efforts necessary to prosecute drug traffickers and IRS:CI‘s role in unraveling their financial transactions” said IRS-Criminal Investigation Special Agent in Charge Andy Tsui. “IRS:CI is proud to provide our financial expertise as we work alongside our law enforcement partners to bring criminals to justice."
“The harm this defendant posed to the community illustrates why FBI Denver’s Southern Colorado Safe Streets Task Force is so crucial,” said Special Agent in Charge Michael Schneider. “Whether taking down one individual or a network, this case reflects the valuable partnership the FBI holds with law enforcement agencies to mitigate the distribution of illegal drugs and make our communities safer.”
This case was investigated by IRS:CI and the FBI. The case was prosecuted by Assistant U.S. Attorney Aaron Teitelbaum.
Case Number: 21-cr-00197-WJM
Co-defendants Sentenced in Methamphetamine Distribution ConspiracyRead the Press Release
Acting United States Attorney Steven Russell announced Patricia Jacobsen, 36, of Omaha, Nebraska, and Elycia Washington, 24, of Arizona, were sentenced in federal court in Omaha for conspiracy to distribute and possess with intent to distribute methamphetamine. Chief United States District Judge Robert F. Rossiter, Jr. sentenced Washington to 54 months imprisonment. Jacobsen received a total sentence of 12 years’ imprisonment as the court revoked a prior term of supervised release and added an additional year based on the revocation. Jacobsen was also ordered to forfeit $17,380.00. There is no parole in the federal system. After their release from prison, Washington will begin a five-year term of supervised release and Jacobsen will begin a 10-year term.
On October 20, 2020, Omaha Police Department officers executed a search warrant on Jacobsen’s Omaha residence and found 339.2 grams of actual methamphetamine and $17,380.00. For a few months before October 20, Jacobsen was receiving methamphetamine from Brandy Williamson who is from Arizona. Jacobsen and Williamson had an agreement in which Williamson regularly traveled to Omaha, from Arizona, to provide Jacobsen with quantities of methamphetamine to sell.
The next day officers had contact with Williamson and Washington at an Omaha hotel room. The room was searched, and officers found with 16.4 pounds of methamphetamine. Williamsons has pleaded guilty and is pending sentencing.
This case was investigated by the Omaha Police Department.
Clinton man sentenced to more than six years in prison for trafficking meth in Missoula, Flathead countiesRead the Press Release
MISSOULA — A Clinton man who admitted to trafficking methamphetamine in Missoula and Flathead counties was sentenced today to six years and four months in prison, to be followed by five years of supervised release, U.S. Attorney Jesse Laslovich said.
Michael Scott Naron, 34, pleaded guilty in April to conspiracy to distribute meth.
U.S. District Judge Donald W. Molloy presided.
The government alleged in court documents that Naron was a meth dealer in Missoula and Flathead counties from January 2020 through October 2020. In May 2020, a burglary investigation led to a search of Naron’s home in which law enforcement recovered heroin, cocaine, fentanyl, U.S. currency, two stolen firearms and other stolen items. During a traffic stop of Naron on Interstate 90 in Montana in October 2020, law enforcement later searched his vehicle and recovered meth, heroin, firearms and drug paraphernalia. Additionally, law enforcement learned from an informant that the individual provided Naron large quantities of meth and received two stolen firearms from him.
Assistant U.S. Attorney Tara J. Elliott prosecuted the case, which was investigated by the FBI’s Montana Regional Violent Crime Task Force, Missoula County Sheriff’s Office, Missoula Police Department and Montana Highway Patrol.
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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Cedar Rapids Man Sentenced to Six Months in Federal Prison for Being a Drug User in Possession of Firearms and AmmunitionRead the Press Release
A drug user who possessed firearms and ammunition was sentenced September 1, 2022, to six months in federal prison.
Douglas Studer, age 63, of Cedar Rapids, received the sentence after a November 15, 2021 guilty plea to one count of being a drug user in possession of firearms and ammunition. At the plea hearing, Studer admitted that, on May 17, 2019, he knowingly possessed two pistols and 932 rounds of ammunition while being a user of methamphetamine.
Studer was sentenced in Cedar Rapids by United States District Court Judge C.J. Williams. Studer was sentenced to six months’ imprisonment. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
This case was brought as part of Project Safe Neighborhoods (PSN). PSN is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
Studer was released on the bond previously set and is to surrender to the United States Marshal on October 3, 2022.
This case was prosecuted by Assistant United States Attorney Mark Tremmel and was investigated by the Dubuque Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Iowa Division of Criminal Investigation.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is CR 21-1027.
Follow us on Twitter @USAO_NDIA.
Birmingham Man Indicted on Gun ChargesRead the Press Release
BIRMINGHAM, Ala. – A federal grand this week indicted a man on gun charges, announced U.S. Attorney Prim F. Escalona and Bureau of Alcohol, Tobacco, Firearms, and Explosives Special Agent in Charge Mickey French.
A two-count indictment filed in U.S. District Court charges David Jermaine Lake, 31, of Vance, with possession of a machine gun and receipt of an unregistered firearm.
According to the indictment, in March 2022, Lake illegally possessed a Glock 9mm pistol equipped with a “Glock switch” – an after-market device designed to illegally convert a semiautomatic Glock pistol into a fully automatic machine gun.
The maximum penalty for possession of a machine gun is 10 years in prison.
The maximum penalty for receipt or possession of an unregistered firearm is 10 years in prison.
ATF investigated the case, along with the Hoover Police Department. Assistant U.S. Attorney Michael A. Royster is prosecuting the case.
This case is part of Project Safe Neighborhoods (PSN), the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
The conversion of the semiautomatic Glock pistol to a fully automatic machine gun causes the firearm to become inaccurate, spraying bullets everywhere, and increasing danger to innocent bystanders. If you know someone who has a Glock switch, you are asked to call law enforcement. Information about Glock switches can be reported to ATF at 1-888-ATF-TIPS or 1-888-283-8477.
An indictment contains only charges. A defendant is presumed innocent unless and until proven guilty.
Bayer to Pay $40 Million to Resolve the Alleged Use of Kickbacks and False Statements Relating to Three DrugsRead the Press Release
Bayer Corporation, an Indiana corporation and manufacturer of pharmaceutical products, and its related entities, Bayer HealthCare Pharmaceuticals Inc., Bayer HealthCare LLC and Bayer AG (collectively “Bayer”), have agreed to pay $40 million to resolve alleged violations of the False Claims Act in connection with the drugs Trasylol, Avelox and Baycol.
The settlement announced today arose from two “whistleblower” lawsuits filed and pursued by Laurie Simpson, a former employee of Bayer who worked in its marketing department.
In a lawsuit filed in the District of New Jersey, Simpson alleged that Bayer paid kickbacks to hospitals and physicians to induce them to utilize the drugs Trasylol and Avelox, and also marketed these drugs for off-label uses that were not reasonable and necessary. Simpson further alleged that Bayer downplayed the safety risks of Trasylol. The lawsuit alleged that as a result of this conduct, Bayer caused the submission of false claims to the Medicare and Medicaid Programs and violated the laws of 20 states and the District of Columbia. Trasylol is a drug used to control bleeding in certain heart surgeries. Avelox is an antibiotic approved to treat certain strains of bacteria.
Simpson filed a second lawsuit relating to Bayer’s statin drug, Baycol, which was later transferred to the District of Minnesota. That lawsuit alleged that Bayer knew about, but downplayed, Baycol’s risks of causing rhabdomyolysis. The lawsuit further alleged that Bayer misrepresented the efficacy of Baycol when compared to other statins and fraudulently induced the Defense Logistics Agency to renew certain contracts relating to Baycol. Subsequently, Trasylol and Baycol were withdrawn from the market for safety reasons.
“Simpson diligently pursued this matter for almost two decades,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Department of Justice’s Civil Division. “Today’s recovery highlights the critical role that whistleblowers play in the effective use of the False Claims Act to combat fraud in federal healthcare programs.”
“We recognize Simpson for her perseverance with this matter,” said U.S. Attorney Andrew M. Luger for the District of Minnesota. “We are pleased we were able to work with the parties to facilitate this resolution and help bring this longstanding matter to a close.”
“As alleged in the complaints, Bayer – one of the largest pharmaceutical companies in the world – engaged in a series of unlawful acts, including paying kickbacks to doctors and hospitals, marketing them off-label, and downplaying their safety risks,” said U.S. Attorney Philip R. Sellinger for the District of New Jersey. “This resolution should send a message to the pharmaceutical industry that such conduct undermines the integrity of federal health care programs and jeopardizes patient safety. This settlement reflects the importance of the whistleblower’s role in litigating False Claims Act actions on behalf of the United States, and we thank Ms. Simpson and her counsel for stepping forward and pursuing this case to conclusion.”
Under the terms of the settlement, Bayer will pay $38,860,555 to the United States and $1,139,445 to the 20 states and the District of Columbia.
The two actions resolved by the settlement were brought under the qui tam or whistleblower provisions of the False Claims Act, which permit private citizens to bring suit on behalf of the government for false claims and share in any recovery. The United States may intervene in the action or, as in this case, the whistleblower may proceed with the matter. Simpson will receive approximately $11 million from the proceeds of the settlement.
The cases are captioned United States ex rel. Simpson v. Bayer Corp. Civ. No. 05-cv-3895 (D.N.J.), and United States ex rel. Simpson v. Bayer Corp., Civ. No. 08-5758 (D.Minn), and were monitored by the Civil Division’s Commercial Litigation Branch and the U.S. Attorneys’ Offices for the District of New Jersey and the District of Minnesota.
The claims settled by this agreement are allegations only, and there has been no admission of liability.
Bayer to Pay $40 Million to Resolve the Alleged Use of Kickbacks and False Statements Relating to Three DrugsRead the Press Release
MINNEAPOLIS – Bayer Corporation, an Indiana corporation and manufacturer of pharmaceutical products, and its related entities, Bayer HealthCare Pharmaceuticals Inc., Bayer HealthCare LLC and Bayer AG (collectively “Bayer”), have agreed to pay $40 million to resolve alleged violations of the False Claims Act in connection with the drugs Trasylol, Avelox and Baycol.
The settlement announced today arose from two “whistleblower” lawsuits filed and pursued by Laurie Simpson, a former employee of Bayer who worked in its marketing department.
In a lawsuit filed in the District of New Jersey, Simpson alleged that Bayer paid kickbacks to hospitals and physicians to induce them to utilize the drugs Trasylol and Avelox, and also marketed these drugs for off-label uses that were not reasonable and necessary. Simpson further alleged that Bayer downplayed the safety risks of Trasylol. The lawsuit alleged that as a result of this conduct Bayer caused the submission of false claims to the Medicare and Medicaid Programs and violated the laws of 20 states and the District of Columbia. Trasylol is a drug used to control bleeding in certain heart surgeries Avelox is an antibiotic approved to treat certain strains of bacteria Simpson filed a second lawsuit relating to Bayer’s statin drug, Baycol, which was later transferred to the District of Minnesota. That lawsuit alleged that Bayer knew about, but downplayed, Baycol’s risks of causing rhabdomyolysis. The lawsuit further alleged that Bayer misrepresented the efficacy of Baycol when compared to other statins and fraudulently induced the Defense Logistics Agency to renew certain contracts relating to Baycol. Subsequently, Trasylol and Baycol were withdrawn from the market for safety reasons.
“Simpson diligently pursued this matter for almost two decades,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Department of Justice’s Civil Division. “Today’s recovery highlights the critical role that whistleblowers play in the effective use of the False Claims Act to combat fraud in federal healthcare programs.”
“We recognize Simpson for her perseverance with this matter,” said U.S. Attorney Andrew M. Luger for the District of Minnesota. “We are pleased we were able to work with the parties to facilitate this resolution and help bring this longstanding matter to a close.”
“As alleged in the complaints, Bayer – one of the largest pharmaceutical companies in the world – engaged in a series of unlawful acts, including paying kickbacks to doctors and hospitals, marketing them off-label, and downplaying their safety risks,” said U.S. Attorney Philip R. Sellinger, District of New Jersey. “This resolution should send a message to the pharmaceutical industry that such conduct undermines the integrity of federal health care programs and jeopardizes patient safety. This settlement reflects the importance of the whistleblower’s role in litigating False Claims Act actions on behalf of the United States, and we thank Ms. Simpson and her counsel for stepping forward and pursuing this case to conclusion.”
Under the terms of the settlement, Bayer will pay $38,860,555 to the United States and $1,139,445 to the 20 states and the District of Columbia.
The two actions resolved by the settlement were brought under the qui tam or whistleblower provisions of the False Claims Act, which permit private citizens to bring suit on behalf of the government for false claims and share in any recovery. The United States may intervene in the action or, as in this case, the whistleblower may proceed with the matter. Simpson will receive approximately $11 million from the proceeds of the settlement.
The cases are captioned United States ex rel. Simpson v. Bayer Corp. Civ. No. 05-cv-3895 (D.N.J.), and United States ex rel. Simpson v. Bayer Corp., Civ. No. 08-5758 (D.Minn), and were monitored by the Civil Division’s Commercial Litigation Branch, and the U.S. Attorneys’ Offices for the District of New Jersey and the District of Minnesota.
The claims settled by this agreement are allegations only, and there has been no admission of liability.
Bayer Corp. to Pay $40 Million to Resolve Alleged use of Kickbacks and False Statements Relating to Three DrugsRead the Press Release
NEWARK, N.J. – Bayer Corp., an Indiana corporation and manufacturer of pharmaceutical products, and its related entities, Bayer HealthCare Pharmaceuticals Inc., Bayer HealthCare LLC, and Bayer AG (collectively “Bayer”), have agreed to pay $40 million to resolve alleged violations of the False Claims Act in connection with the drugs Trasylol, Avelox, and Baycol.
The settlement announced today arose from two “whistleblower” lawsuits filed and pursued by a former employee of Bayer who worked in its marketing department.
In a lawsuit filed in the District of New Jersey, the employee, Laurie Simpson, alleged that Bayer paid kickbacks to hospitals and physicians to induce them to utilize the drugs Trasylol and Avelox, and also marketed these drugs for off-label uses that were not reasonable and necessary. Simpson further alleged that Bayer downplayed the safety risks of Trasylol. The lawsuit alleged that as a result of this conduct Bayer caused the submission of false claims to the Medicare and Medicaid programs and violated the laws of 20 states and the District of Columbia. Trasylol is a drug used to control bleeding in certain heart surgeries. Avelox is an antibiotic approved to treat certain strains of bacteria.
Simpson filed a second lawsuit relating to Bayer’s statin drug, Baycol, which was later transferred to the District of Minnesota. That lawsuit alleged that Bayer knew about, but downplayed, Baycol’s risks of causing a serious syndrome that results from the death of muscle fibers and the release of their contents into the bloodstream. The lawsuit further alleged that Bayer misrepresented the efficacy of Baycol when compared to other statins and fraudulently induced the Defense Logistics Agency to renew certain contracts relating to Baycol. Subsequently, Trasylol and Baycol were withdrawn from the market for safety reasons.
“As alleged in the complaints, Bayer – one of the largest pharmaceutical companies in the world – engaged in a series of unlawful acts, including paying kickbacks to doctors and hospitals, marketing them off-label, and downplaying their safety risks,” U.S. Attorney Philip R. Sellinger, District of New Jersey, said. “This resolution should send a message to the pharmaceutical industry that such conduct undermines the integrity of federal health care programs and jeopardizes patient safety. This settlement reflects the importance of the whistleblower’s role in litigating False Claims Act actions on behalf of the United States, and we thank Ms. Simpson and her counsel for stepping forward and pursuing this case to conclusion.”
“Ms. Simpson diligently pursued this matter for almost two decades,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Department of Justice’s Civil Division. “Today’s recovery highlights the critical role that whistleblowers play in the effective use of the False Claims Act to combat fraud in federal healthcare programs.”
“We recognize Ms. Simpson for her perseverance with this matter,” said U.S. Attorney Andrew M. Luger, District of Minnesota, said. “We are pleased we were able to work with the parties to facilitate this resolution and help bring this longstanding matter to a close.”
Under the terms of the settlement, Bayer will pay $38.9 million to the United States and $1.14 million to the 20 states and the District of Columbia.
The two actions resolved by the settlement were brought under the qui tam or whistleblower provisions of the False Claims Act, which permit private citizens to bring suit on behalf of the government for false claims and share in any recovery. The United States may intervene in the action or, as in this case, the whistleblower may proceed with the matter. Ms. Simpson will receive $11 million from the proceeds of the settlement.
The resolution obtained in this matter was supported by a coordinated effort between the U.S. Attorney’s Office in the District of New Jersey, the Department of Justice Civil Division’s Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office in the District of Minnesota.
The government is represented by Assistant U.S. Attorney Kruti D. Dharia of the District of New Jersey’s Opioid Abuse Prevention and Enforcement Unit, Senior Trial Counsel Sanjay M. Bhambhani of the Civil Division’s Commercial Litigation Branch, Fraud Section, and First Assistant U.S. Attorney Ann M. Bildtsen of the District of Minnesota.
The cases are captioned United States ex rel. Simpson v. Bayer Corp. Civ. No. 05-cv-3895 (D.N.J.), and United States ex rel. Simpson v. Bayer Corp., Civ. No. 08-cv-5758 (D.Minn).
The claims settled by this agreement are allegations only, and there has been no admission of liability.
Arizona Man Sentenced for Trafficking Fentanyl in Eastern IdahoRead the Press Release
POCATELLO – Gabriel Lopez, 46, of Tucson, Arizona was sentenced to five years in federal prison for possession with intent to distribute fentanyl, U.S. Attorney Josh Hurwit announced today.
According to court records, Lopez was arrested on July 19, 2021, after detectives with the BADGES Task Force conducted an investigation and found a bag containing 1,694 pills that tested positive for fentanyl in Lopez’s vehicle during a traffic stop. The approximate street value of the pills seized is $34,000-$42,500. Lopez admitted to police that he knew that the pills contained fentanyl.
Fentanyl is a powerful synthetic opioid that is often disguised as oxycodone, blue pills stamped with “M 30.” Most fentanyl is produced in Mexico by drug cartels. Inconsistent dosages in illicitly manufactured pills containing fentanyl have contributed to a dramatic increase in overdoses across the county. Approximately 42% of fentanyl pills seized by law enforcement have a lethal dose of fentanyl in them.
“Fentanyl is a deadly poison causing incalculable harm across country, and unfortunately Idaho is not exempt from this crisis,” said U.S. Attorney Hurwit. “We must band together to raise awareness, and our Office is grateful to work with dedicated law enforcement partners to take this drug off of our streets and to remove from our communities those who peddle it.”
“These are important cases as the drug trade and illicit drug use takes a deadly toll on our communities,” said Oregon-Idaho High Trafficking Area (HIDTA) Lieutenant Clint Skinner. “Over the past three years, we have seen an increase of fentanyl in Idaho; it is addictive and dangerous. Law enforcement agencies will continue working together to interrupt the supply while community support is needed to address demand for the drug. A five-year sentence taking almost 1,700 pills off our streets is a success. We thank all the agencies involved.”
U.S. District Judge B. Lynn Winmill also ordered Lopez to serve five years of supervised release following his prison sentence. Lopez pleaded guilty to the charge on April 28, 2022.
U.S. Attorney Hurwit, of the District of Idaho, commended the cooperative efforts of the BADGES Task Force which led to charges.
The BADGES Task Force is a multi-jurisdictional narcotics task force that identifies, disrupts, and dismantles local, multi-state, and international drug trafficking organizations using intelligence-driven, multi-agency prosecutor-supported approach. BADGES Task Force is supported by the Oregon-Idaho High-Intensity Drug Trafficking Area (HIDTA) which is composed of members from the Idaho State Police, Pocatello Police Department, Bannock County Sheriff’s Department, Chubbuck Police Department, and the Drug Enforcement Administration.
This case was handled by the U.S. Attorney Office’s specially deputized Special Assistant U.S. Attorney (SAUSA), funded by the Eastern Idaho Partnership (EIP) and the State of Idaho. The EIP is a coalition of local city and county officials in eastern Idaho as well as the Idaho Department of Correction.
The EIP SAUSA program allows law enforcement to utilize the federal criminal justice system – through the EIP SAUSA – to prosecute, convict, and sentence violent, armed criminals and drug traffickers. These criminals often receive stiffer penalties than they might in state courts.
This program was created in January 2016. Since that time, approximately 199 defendants have been indicted by the EIP SAUSA. Of these defendants, 146 have been indicted on drug trafficking charges. The defendants indicted under the program have been sentenced to 8,469 months (approximately 706 years) in federal prison, representing an average prison sentence of 54 months (4.5 years). Defendants indicted for drug trafficking offenses serve, on average, approximately 58.2 months (4.85 years) in federal prison.
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1 September 2022
Wolf Point man admits fentanyl trafficking crimeRead the Press Release
GREAT FALLS — A Wolf Point man suspected of going to the post office and picking up a package he thought contained fentanyl pills admitted to charges today, U.S. Attorney Jesse Laslovich said.
Andre Jean Reum, 24, pleaded guilty to attempted possession with intent to distribute fentanyl. Reum faces a mandatory minimum five years to 40 years in prison, a $5 million fine and at least four years of supervised release.
Chief U.S. District Judge Brian M. Morris presided. Chief Judge Morris set sentencing for Jan. 5, 2023. The court will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. Reum was detained pending further proceedings.
The government alleged in court documents that the U.S. Postal Service inspector identified a suspicious package mailed from Tacoma, Washington, to a post office box in Wolf Point, on the Fort Peck Indian Reservation. On May 23, the inspector served a search warrant on the package and found toys and plastic bags that contained suspected fentanyl. The inspector removed the suspected fentanyl and repackaged the parcel, which was delivered to the Wolf Point post office the next day. Reum went to the post office later in the day, after having checked on the package earlier in the day and on the previous day. Reum retrieved the package, spoke to a bystander and was arrested. The bystander reported that Reum had slapped the parcel and stated he had to take care of business. An analysis determined that 586 pills contained fentanyl.
Assistant U.S. Attorney Ethan R. Plaut is prosecuting the case, which was investigated by the FBI, Bureau of Indian Affairs, U.S. Postal Service, Fort Peck Tribes Department of Law and Justice and the Roosevelt County Sheriff’s Office.
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Wilmington Man Who Possessed Fake Oxycodone Pills for Resale Sentenced to 10 Years in Federal PrisonRead the Press Release
WILMINGTON, Del. – David C. Weiss, U.S. Attorney for the District of Delaware, announced that Jacquill Stovall, 33, of Wilmington, was sentenced today to 10 years in federal prison by U.S. District Judge Richard G. Andrew for possessing a stolen firearm and possessing fentanyl with the intent to distribute it.
According to court documents and statements made in open court, the Wilmington Police Department and the Drug Enforcement Administration (DEA) began investigating Stovall after he sold fake Oxycodone pills to a law-enforcement cooperator in January 2021. In a subsequent search of Stovall’s apartment in downtown Wilmington, officers found additional fake Oxycodone pills, along with a stolen firearm hidden in a kitchen cabinet. When law enforcement arrested Stovall, they found a second loaded gun in his waistband. Stovall admitted that he had been selling the pills and that he knew they were not Oxycodone. Chemical testing showed that the pills contained fentanyl, an extremely dangerous controlled substance.
U.S. Attorney Weiss commented on the sentence, “More people die every year by overdosing on fentanyl than by homicide. In the midst of an escalating opioid epidemic, Stovall sold fake Oxycodone pills to addicts. Unlike lawfully prescribed medications, these counterfeit pills had been pressed on the streets and actually contained fentanyl. And although he tried to hide it in a kitchen cabinet, Stovall also possessed a stolen firearm. Now, he will spend ten years in federal prison for his crimes.”
“This investigation is a great example of our strong partnership with the DEA and our joint efforts to make our communities safer,” stated Wilmington Department of Police Chief Robert Tracy.
“Stovall was responsible for trafficking fake pills that contained illicit fentanyl and for possessing a stolen firearm,” said Thomas Hodnett, Special Agent in Charge of the DEA’s Philadelphia Field Division. “Stopping the deadly supply of fake pills such as the ones that Stovall trafficked is the highest enforcement priority for the DEA. Learn more about the dangers of fake pills from DEA’s One Pill Can Kill campaign, which can be accessed at DEA.gov/OnePill.”
Assistant U.S. Attorney Christopher R. Howland prosecuted the case, which was investigated by WPD and the DEA.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the District of Delaware. Related court documents and information is located on the website of the District Court for the District of Delaware or on PACER by searching for Case No. 22-cr-18-RGA.
United States Awards $10 Million Default Judgment and Permanent Injunction Against Two Michigan Companies and Their Owner for the Sale of Vehicle Emission “Defeat Devices”Read the Press Release
On Aug. 29, the U.S. District Court in the Eastern District of Michigan awarded a default judgment, granting the proposed $10 million civil penalty against Diesel Ops LLC and Orion Diesel LLC of Waterford, Michigan. The violations the United States identified in its December 2021 complaint included the manufacture, sale and installation of aftermarket parts known as “defeat devices” designed to disable or bypass required vehicle emissions controls.
The court also granted the proposed $455,925 civil penalty against the owner of the two companies, Nicholas Piccolo, for failing to respond to an information request issued pursuant to Section 208 of the Clean Air Act and entered a judgment against Piccolo of slightly less than $1 million for alleged fraudulent transfers in violation of the Federal Debt Collection Procedures Act. The court entered a permanent injunction against future sales of defeat devices against all of the defendants.
“Defeat devices violate Clean Air Act emissions requirements that protect public health and the environment, including by protecting vulnerable communities that are disproportionately impacted by air pollution,” said Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division (ENRD). “The United States will vigorously enforce the Clean Air Act, including its prohibition of illegal devices that bypass emission controls and harm the environment and public health.”
“The Environmental Protection Agency (EPA) has made it a priority to stop the manufacture, sale and installation of defeat devices, because they result in illegal and harmful emissions that continue over the life of the vehicle,” said Acting Assistant Administrator Larry Starfield for EPA’s Office of Enforcement and Compliance Assurance. “This case shows that EPA and our law enforcement partners will hold responsible those who illegally profit from defeat devices.”
“This action sends a strong message that selling and installing defeat devices on vehicles and engines will not be tolerated,” said EPA Region 5 Administrator Debra Shore. “Emission control systems on vehicles are designed to protect public health by reducing pollution, which is why EPA is committed to ensuring that companies comply with the Clean Air Act.”
As a result of EPA’s efforts to improve air quality and fuel efficiency, cars and trucks manufactured today emit far less pollution than older vehicles. To meet EPA's emission standards, engine manufacturers have carefully calibrated their engines and installed sophisticated emissions control systems. EPA testing has shown that aftermarket defeat devices can increase vehicle emissions substantially, which can contribute to a variety of public health problems typically associated with exposure to air pollution. These health effects can include premature death in people with heart or lung disease, heart attacks, irregular heartbeat, aggravated asthma, decreased lung function and respiratory symptoms such as irritation of the airways, coughing or difficulty breathing. This enforcement action is one of more than 40 civil enforcement cases initiated by EPA and the Justice Department as part of the National Compliance Initiative for Stopping Aftermarket Defeat Devices for Vehicles and Engines: https://www.epa.gov/enforcement/national-compliance-initiative-stopping-aftermarket-defeat-devices-vehicles-and-engines.
Because defeat devices contribute excess dirty emissions to communities located adjacent to highways and freight facilities, EPA regards halting the manufacture, sale, offering for sale and installation of defeat devices as key issues in working toward environmental justice.
Union City Man Sentenced to 4 Years in Federal Prison for Small Business RobberiesRead the Press Release
OAKLAND - Nelson Enrike Ramirez was sentenced today to 48 months in federal prison for multiple robberies of small stores and gas stations in East Bay and South Bay communities that affected interstate commerce, announced United States Attorney Stephanie M. Hinds and Federal Bureau of Investigation Special Agent in Charge Sean Ragan. The sentence was handed down by United States District Judge Jon S. Tigar.
Ramirez, 41, of Union City, California, was charged on December 1, 2021, by a federal information for the November 3, 2020, robbery of a 7-Eleven convenience store in Campbell, California, and the November 6, 2020, robbery of a 7-Eleven in Fremont.
On April 22, 2022, Ramirez entered a plea agreement and pleaded guilty to those two robberies and admitted 21 others. In his plea agreement, Ramirez described that from May to November 2020, he committed or attempted 23 robberies of small businesses in the East and South Bay areas, including Fremont, Newark, Hayward, Union City, Campbell, Milpitas, Mountain View, Los Altos, and Sunnyvale. During the robberies and attempted robberies, he carried a black rubber replica semiautomatic firearm and brandished it, and sometimes pointed it, at store clerks when demanding money. Ramirez often apologized to the store employees, stating he needed money because he had a sick child at home – but in his plea agreement he admitted he lied. He does not have a child.
Ramirez detailed two robberies in his plea agreement. On November 3, 2020, Ramirez entered a 7-Eleven convenience store in Campbell and asked the store clerk a question. When she approached, Ramirez told the clerk he needed money because his son was sick and insurance would not cover it. He pulled the black rubber replica firearm out of his pocket and held it at his side. He instructed the clerk to open the register, then walked behind the store’s counter with the clerk. Ramirez took approximately $1,500 from the open register and fled.
Ramirez also described in his plea agreement that three days later, on November 6, 2020, he walked into a 7-Eleven store in Fremont. He told the store clerk he needed a soda. When the clerk helped him, Ramirez pulled the replica firearm out of his pocket and told the clerk he needed money. He ordered the clerk to walk to the cash register. The clerk opened the register and handed Ramirez approximately $200. Ramirez forced the clerk to open a second cash register, but it was empty. Ramirez then left the store.
In addition to the 48 month sentence, United States District Judge Tigar ordered Ramirez to pay $9,192 in restitution and to serve a three year period of supervision when he leaves prison. Ramirez was in custody at his sentencing hearing and begins serving his sentence immediately.
Noah Stern is the Assistant U.S. Attorney who is prosecuting the case, with the assistance of Karina Ruiz, Kay Konopaske, and Kathleen Turner. The prosecution is the result of an investigation by the FBI, the Fremont Police Department, the Union City Police Department, the Newark Police Department, the Hayward Police Department, the Campbell Police Department, the Milpitas Police Department, the Mountain View Police Department, the Los Altos Police Department, and the Sunnyvale Police Department.
U.S. Attorney Settles Fraud Lawsuit Against Non-Profit for Inflating Medicaid Reimbursements by Falsely Reporting Millions in CostsRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Scott Lampert, the Special Agent in Charge of the New York Office of the U.S. Department of Health and Human Services, Office of Inspector General (“HHS-OIG”), announced that the United States has settled civil fraud claims against Maranatha Human Services, Inc. (“MARANATHA”) for falsely claiming that millions of dollars expended to benefit for-profit ventures owned and controlled by MARANATHA and its founder HENRY ALFONSO COLEY (“COLEY”), as well as payments to cover COLEY’s personal expenses and excessive payments to COLEY’s family members, were reasonable and necessary costs in connection with MARANATHA’s provision of Medicaid-funded services to individuals with developmental disabilities. MARANATHA is a non-profit organization based in Poughkeepsie, New York; COLEY founded MARANATHA in 1988 and served as its chief executive officer until last year.
Specifically, the Government’s complaint, which was filed in November 2021, alleges that MARANATHA, with its board’s approval, funded for-profit companies operated by COLEY; paid excessive salaries and consulting fees to COLEY’s family members, often in exchange for little to no work; and paid for tens of thousands of dollars of COLEY’s personal expenses. The Government further alleges that, from 2010 to 2019, COLEY and MARANATHA submitted to the State of New York cost reports that falsely claimed millions of dollars of these expenses as “allowable” costs, which fraudulently inflated MARANATHA’s Medicaid reimbursement rates and resulted in MARANATHA receiving millions of dollars in Medicaid funds to which it was not entitled.
U.S. Attorney Damian Williams said: “For a decade, Henry Alfonso Coley and Maranatha defrauded Medicaid by submitting reports that fraudulently claimed as allowable expenses millions of dollars spent on for-profit companies owned by them, excessive salaries and fees for Coley’s family members, and Coley’s personal expenses. These expenses were not related to providing care or assistance to the individuals with developmental disabilities who Maranatha was meant to serve. Now Coley and Maranatha have each agreed to pay damages, Coley has been barred from working for any entity that bills federal healthcare programs, and Maranatha will close its doors.”
HHS-OIG Special Agent in Charge Scott Lampert said: “It is incumbent upon the recipient of Medicaid funds to ensure that costs reported for reimbursement are accurate and in accordance with the program’s regulations; this is a steadfast requirement of participating in the Medicaid program. The use of federal dollars for unallowable expenses diverts much-needed resources meant to support health care services for vulnerable individuals. Putting a stop to such activity, through collaboration with our law enforcement partners, is a prime objective of HHS-OIG.”
Under the settlement approved yesterday by U.S. District Judge Kenneth M. Karas, MARANATHA agrees to cease operations after transitioning the operation of its programs to other providers under the supervision of the governing state regulatory agency. MARANATHA will also pay $340,000 to the United States and has admitted and accepted responsibility for conduct alleged by the Government in its complaint as further described below. In addition, MARANATHA has agreed to pay $510,000 to the State of New York to resolve the State’s claims, for a total recovery of $850,000. The settlement amount is based on the Office’s assessment of MARANATHA’s ability to pay based on the financial information it provided and its commitment to cease operations. The United States previously resolved the claims against COLEY through a settlement approved by Judge Karas on November 17, 2021. In addition to paying damages to the United States and the State of New York, COLEY was barred from working for any entity that bills federal healthcare programs; he also entered into a Voluntary Exclusion Agreement with HHS-OIG, which prohibits him from, among other things, billing Medicaid and other federal healthcare programs for 15 years.
According to the Government’s complaint, from 2010 through 2019:
MARANATHA was required to submit cost reports, called Consolidated Financial Reports (“CFRs”), to the State of New York each year, specifying the reasonable and necessary costs MARANATHA incurred in providing services for its Medicaid-funded programs. These costs were to be reported as “allowable” costs. MARANATHA was required separately to report its other, “non-allowable” costs; “non-allowable” costs include costs unrelated to its Medicaid-funded programs, as well as any unreasonable or unnecessary costs.
With its board’s approval, MARANATHA funded for-profit companies operated by COLEY and owned by COLEY or MARANATHA, as well as various unincorporated pet projects started by COLEY. One of the chief purposes of these ventures was to serve as vehicles to funnel money to COLEY’s daughter, as well as others associated with COLEY, whom MARANATHA paid for work they purportedly did to support these ventures and projects. Over the course of a decade, not one of these ventures ever launched a product or service or earned a single dollar in revenue. COLEY and MARANATHA hired COLEY’s family members as employees and consultants, some in connection with these for-profit ventures, and others in connection with MARANATHA’s Medicaid-funded services. COLEY and MARANATHA paid excessive salaries and consulting fees to COLEY’s family members, often in return for little to no work. MARANATHA also paid for tens of thousands of dollars of COLEY’s personal expenses, including more than $34,000 for personal training sessions at a gym.
COLEY and MARANATHA knowingly submitted CFRs annually to the State of New York fraudulently reporting these expenses—totaling millions of dollars—as “allowable” costs. On each CFR, COLEY falsely certified to the completeness and accuracy of the report. COLEY and MARANATHA knew that the State of New York relied on providers’ CFRs when setting provider-specific reimbursement rates for certain Medicaid-funded programs, including MARANATHA’s largest Medicaid-funded program. As a result of COLEY’s and MARANATHA’s falsely inflated cost reports, the State of New York awarded MARANATHA a higher reimbursement rate and MARANATHA received millions of dollars in Medicaid funds to which it was not entitled.
As part of the settlement, MARANATHA admits, acknowledges, and accepts responsibility for the following conduct:
- COLEY made a presentation to MARANATHA’s board of directors acknowledging that “[i]t was always the plan for Maranatha to use government funds as a launching pad to create private enterprise that would enable it to not be dependent on [the] government while at the same time fulfilling its function” consistent with its mission.
- MARANATHA knew of the requirement to distinguish “allowable costs” from “non-allowable costs” in its CFRs.
- MARANATHA knew that the allowable costs reported in its CFRs are used by the New York State Department of Health, in part, to determine MARANTHA’s reimbursement rates for the provision of Medicaid services.
- In each CFR that MARANATHA submitted from 2010 to 2019 (the “Covered Period”), MARANATHA’s CEO, COLEY, certified that (i) the “information furnished in this report . . . is in accordance with the instructions and is true and correct to the best of my knowledge”; and (ii) the statement attached to the CFR “fully and accurately represents all reportable income and expenditures made for services performed in accordance with the provision of the Mental Hygiene Law and approved budgets.”
- Throughout the Covered Period, MARANATHA submitted CFRs every year that reported as “allowable costs” amounts expended not for MARANTHA’s provision of Medicaid-funded services but instead to pursue certain for-profit business ventures.
- In particular, MARANATHA submitted CFRs reporting as “allowable costs” costs expended to benefit certain entities owned and/or operated by COLEY or MARANATHA that did not provide Medicaid-funded services (the “Non-Medicaid Ventures”).
- MARANATHA’s board, which approved MARANATHA funding these Non-Medicaid Ventures, was briefed on them by COLEY.
- MARANATHA paid COLEY’s family members to perform work related to the Non-Medicaid Ventures. For example, since 2010, MARANATHA paid COLEY’s daughter more than $300,000. Though much of her time was spent on work related to the Non-Medicaid Ventures, MARANATHA reported her full compensation as an “allowable cost” in the CFRs.
- Since 2010, MARANATHA paid COLEY more than $2 million in salary and benefits, and MARANTHA claimed the full amount of that compensation as “allowable costs” on its CFRs. However, COLEY devoted much of his time to working on the Non-Medicaid Ventures.
- MARANATHA also paid for certain of COLEY’s personal expenses, including more than $34,000 spent on personal training sessions, as well as holiday gifts and jewelry. MARANATHA reported these expenses as “allowable costs” in its CFRs.
This lawsuit originated as a whistleblower lawsuit filed under seal pursuant to the False Claims Act.
Mr. Williams praised the outstanding investigative work of HHS-OIG, and he thanked the Medicaid Fraud Control Unit at the New York State Attorney General’s Office for its extensive collaboration in the investigation.
The case is being handled by the Office’s Civil Frauds Unit. Assistant U.S. Attorney Jacob Lillywhite is in charge of the case.
Three Men Arrested in Unemployment Insurance Fraud ConspiracyRead the Press Release
ALBANY, NEW YORK – Thomas Brace a/k/a “Justice,” age 61, of Altoona, Pennsylvania, and formerly of Albany; Taliek Lanier, age 22, of Albany; and Errol Murray, age 21, of Yonkers, New York, were arrested this week on an indictment alleging their participation in a conspiracy to defraud the New York State Department of Labor (NYSDOL). The defendants allegedly conspired with Jamie Johnson, who previously pled guilty to fraudulently obtaining $701,441 in unemployment insurance benefits under the names of other people, including benefits funded by the federal government in response to the COVID-19 pandemic.
The announcement was made by United States Attorney Carla B. Freedman; New York State Inspector General Lucy Lang; Matthew Scarpino, Acting Special Agent in Charge of the Buffalo Field Office of Homeland Security Investigations (HSI); Ketty Larco-Ward, Inspector in Charge of the Boston Division of the United States Postal Inspection Service (USPIS); and Jonathan Mellone, Special Agent in Charge, New York Region, United States Department of Labor, Office of Inspector General (USDOL-OIG).
The indictment alleges that Brace, Lanier, and Murray provided Johnson with the personal identifying information of other people, which Johnson used to file false claims via the NYSDOL website. The charges in the indictment are merely accusations. The defendants are presumed innocent unless and until proven guilty.
Murray was arraigned yesterday before United States Magistrate Judge Daniel J. Stewart and released with conditions pending trial. Brace also appeared yesterday before Judge Stewart and is scheduled to be arraigned tomorrow. Lanier appeared today before a federal magistrate judge in the Middle District of Pennsylvania, was released with conditions, and will be arraigned before Judge Stewart on September 7.
The defendants are charged with mail and wire fraud, as well as aggravated identity theft. The mail and wire fraud charges carry a maximum term of 20 years in prison, a fine of up to $250,000, and a term of supervised release of up to 3 years. The charges for aggravated identity theft carry a mandatory term of 2 years in prison, to be imposed consecutive to any other term of imprisonment. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines and other factors.
This case was investigated by the New York State Inspector General’s Office, HSI, USPIS, and USDOL-OIG, with assistance from the NYSDOL Office of Special Investigations, the Capital Region Crime Analysis Center, and the Albany County Department of Social Services. The case is being prosecuted by Assistant U.S. Attorney John T. Chisholm.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
The Willow Domestic Violence Center in Rochester and Community Services for Every1 and the Family Justice Center in Buffalo Awarded Grants from the Office on Violence Against WomenRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, NY – U.S. Attorney Trini E. Ross announced today that two organizations in the Western District of New York have been awarded grants from the Department of Justice’s Office on Violence Against Women (OVW). OVW has awarded nearly $31 million across the country to improve outreach, services, and support for survivors of sexual assault, domestic violence, dating violence, and stalking from underserved communities and culturally specific populations.
The Willow Domestic Violence Center of Greater Rochester received a $450,000 OVW Underserved Program grant award to serve Deaf, Deaf-Blind, and hard of hearing survivors of sexual assault, domestic violence, dating violence and stalking in Monroe County. Deaf Ignite, a Deaf victim services program housed within Willow, will provide advocacy, counseling, community education, and referrals.
Community Services for Every1 and the Family Justice Center of Erie County received a $325,000 grant under OVW’s Disabilities Program to advance the work of their collaborative Helping Others through Protection and Empowerment of Western New York (HOPE of WNY) initiative, which focuses on intellectual/developmental disabilities. Community Services for Every1 and the Family Justice Center will engage local nonprofit organizations, government agencies, and other domestic violence stakeholders in training strategies that foster improved supports for survivors with intellectual/developmental disabilities diagnoses and connect people with intellectual/developmental disabilities to empowering education and victim support opportunities.“These grants, awarded to agencies in the Western District of New York, will ensure that survivors of serious crimes from underserved communities, including survivors with disabilities, have access to vitally important support services, including counseling, advocacy, and education,” said U.S. Attorney Ross.
OVW provides leadership in developing the nation’s capacity to reduce violence through the implementation of the Violence Against Women Act 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.
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Texas Woman Admits to Collecting $1.26 Million in Romance Scam ProceedsRead the Press Release
PROVIDENCE – A Houston, TX, woman today admitted to a federal judge in Providence, RI, that she participated in a conspiracy that scammed unsuspecting and trusting victims of more than $2.6 million dollars through internet-based “romance scams,” and that she personally collected more than $1.26 million dollars in cash, checks, money orders, and wire transfers from individuals from across the United States, and deposited the funds into bank accounts she controlled, announced United States Attorney Zachary A. Cunha.
Dominique Golden, 31, admitted that, as part of the scam, she opened mailboxes and bank accounts in the names of fake individuals and businesses for the purpose of receiving and depositing “romance scam” victim funds. From approximately February 4, 2018, through December 12, 2018, she collected and deposited a total of $1,263,822.54 into bank accounts she controlled.
A United States Postal Inspection Service investigation determined that, collectively, members of the conspiracy defrauded victims of approximately $2,619,839.
To carry out the scheme, members of the conspiracy contacted victims via the internet and app-based communication platforms, cultivated relationships of trust, convinced the victims that money was needed, and then directed the victims to send money via mail or wire transfer to various persons, including Golden. Golden was aware that other members of the conspiracy contacted and developed relationships with the victims for the sole purpose of perpetrating the scam.
Golden pleaded guilty today to one count each of conspiracy to commit mail fraud and wire fraud. She is scheduled to be sentenced on December 6, 2022. The defendant’s sentence will be determined by a federal district judge after consideration of the U.S. Sentencing Guidelines and other statutory factors.
The case is being prosecuted by Assistant United States Denise M. Barton, with the assistance of Assistant United States Attorney Dulce Donovan.
According to a plea agreement filed in this matter, Golden will forfeit all interest in any fraud-related assets traceable or derived from her criminal conduct; this includes a 2018 Bentley Bentayga; a 2017 Mercedes E-Class; a gold oyster perpetual women’s Rolex watch; a gold oyster perpetual men’s Rolex watch; a gold and diamond Rolex bezel; a 16” gold rope chain with a diamond coin pendant; a 24” gold rope chain; three firearms; and $11,731 seized from her home and from the Bentley.
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Terrebonne Parish Men Indicted for Conspiracy to Distribute CocaineRead the Press Release
NEW ORLEANS, LOUISIANA – ANTHONY MONREAL-FABELA, age 21, a resident of Houma, Louisiana, and DIOGO HERNANDEZ, age 18, a resident of Bourg, Louisiana, were charged August 4, 2022, in a sealed one-count indictment by a federal grand jury.
According to court documents, beginning on or about June 14, 2022 and continuing until on or about July 27, 2022, MONREAL-FABELE and HERNANDEZ conspired to distribute and possess with intent to distribute five kilograms or more of cocaine, in violation of Title 21, United States Code, Sections 841(a)(1), 841(b)(1)(A), and 846, announced U.S. Attorney Duane A. Evans. The indictment was unsealed on August 23, 2022.
If convicted, MONREAL-FABELA and HERNANDEZ face a mandatory minimum sentence of ten years, up to maximum of life imprisonment, a fine of up to $10,000,000, at least five years of supervised release following any term of imprisonment, and a $100 mandatory special assessment fee
U.S. Attorney Evans reiterated that the indictment is merely a charging document and that the guilt of the defendants must be proven beyond a reasonable doubt.
This case was investigated by the United States Homeland Security Investigations, Jefferson Parish Sheriff’s Office, and United States Customs and Border Protection. The prosecution is being handled by Assistant United States Attorney J. Benjamin Myers.
Tampa Gang Leader Sentenced to Nearly Four Years for Possessing A Firearm as A Convicted FelonRead the Press Release
Tampa, Florida – U.S. District Judge Mary S. Scriven has sentenced Devin Kelly (27, Tampa) to three years and ten months in federal prison for possessing a firearm and ammunition as a convicted felon. The court also ordered Kelly to forfeit the firearm and ammunition used in the offense. Kelly had pleaded guilty on April 19, 2022.
According to court documents, on July 2, 2021, Kelly, a convicted felon, and Keyshawn Watts, also a convicted felon, held and displayed a rifle during an Instagram live video. One week later, investigators searched Kelly’s residence and seized a Ruger AR .556 caliber rifle and an extended magazine loaded with 40 rounds of ammunition. The rifle had features that matched those of the rifle observed by investigators on the Instagram live video. Kelly admitted that the rifle was the same firearm he had displayed on the video.
Kelly was a member of the Bloods street gang and held a leadership position within the gang. At the time he possessed the firearm, Kelly had been convicted of multiple felony offenses, including aggravated assault and being a felon in possession of a firearm, and therefore, he is prohibited from possessing a firearm or ammunition under federal law.
Watts previously pleaded guilty to the same offense. His sentencing hearing is scheduled for October 4, 2022.
This case was investigated by the Federal Bureau of Investigation and the Tampa Police Department. It was prosecuted by Assistant United States Attorney Michael Sinacore.
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.