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9 August 2022
Leader of a Local Heroin Trafficking Organization Pleads GuiltyRead the Press Release
PITTSBURGH - A Pittsburgh resident pleaded guilty in federal court to violating federal narcotics laws, United States Attorney Cindy K. Chung announced today.
Sean McHenry, 29, of pleaded guilty to one count of conspiracy to distribute and possess with intent to distribute more than 100 grams of heroin from September of 2018 through October of 2019, before United States District Judge William S. Stickman, IV. In addition, McHenry accepted responsibility for possessing a firearm in conjunction with his heroin trafficking. McHenry is one of 19 defendants charged in the Indictment returned in this case.
In connection with the guilty plea, the court was advised that in 2018, the Federal Bureau of Investigation began investigating a heroin trafficking organization lead by McHenry that operated throughout the greater Pittsburgh area. Beginning in February of 2019 and continuing through September of 2019, the FBI received authorization to conduct a Title III wiretap investigation into the organization. McHenry, as one of the leaders of this multi-member drug trafficking organization, was intercepted orchestrating and directing the distribution of heroin throughout Pittsburgh by various members of the organization. In addition to the intercepted communications, agents seized heroin, firearms, and bulk United States Currency from members of the organization, including McHenry.
Judge Stickman scheduled sentencing for Dec. 16, 2022. The law provides for a total sentence of not less than five years to a maximum of 40 years of imprisonment, a fine not to exceed $5,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant. McHenry remains in custody pending sentencing.
Assistant United States Attorney Mark V. Gurzo is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation, Homeland Security Investigations, the Allegheny County Police Department, the Stowe Township Police Department, the Pittsburgh Bureau of Police, the Office of the Attorney General, the Allegheny County Sheriff's Office, the North Versailles Police Department, the Allegheny County Port Authority Police Department, the Munhall Police Department, and the Pennsylvania State Police conducted the investigation leading to the prosecution of McHenry.
This prosecution is a result of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles high-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten communities throughout the United States. OCDETF uses a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
Las Vegas Mail Carrier Pleads Guilty to Mail Fraud ConspiracyRead the Press Release
LAS VEGAS – A Las Vegas woman pleaded guilty today to her role in a conspiracy to commit mail fraud in connection to the illegal possession of unemployment benefit debit cards issued by the Nevada Department of Employment, Training and Rehabilitation (DETR) and Arizona’s Department of Economic Security (DES) — the agencies administer Nevada’s and Arizona’s unemployment insurance program, respectively.
Jasmine-Royshell Kanisha Black (34) pleaded guilty to one count of conspiracy to commit mail fraud. U.S. District Judge Gloria M. Navarro scheduled sentencing for November 2, 2022. At sentencing, Black faces a statutory maximum penalty of 20 years in prison, a term of supervised release, and a fine.
According to court documents and admissions made in court, Black — who was employed as a U.S. Postal Service mail carrier — assisted co-conspirator Vincent Okoye to fraudulently obtain unemployment insurance benefits from DETR and DES using other people’s personal identifying information — such as their names, dates of birth, and social security numbers — without their consent. Black used her position to help Okoye find either vacant residences or rarely-checked mailboxes to which fraudulently obtained debit cards could be sent. She then intercepted and delivered those cards to Okoye in person. In total, DETR and DES approved of at least $462,000 in benefits for these fraudulent claims submitted by Black and Okoye.
U.S. Attorney Jason M. Frierson for the District of Nevada, Special Agent in Charge Karon Ransom for the U.S. Secret Service, and Special Agent in Charge Glenn SanJose for the U.S. Postal Service-Office of Inspector General made the announcement.
The case was investigated by the U.S. Secret Service, U.S. Postal Service-Office of Inspector General, and the Las Vegas Metropolitan Police Department. Assistant U.S. Attorney Jim Fang is prosecuting the case.
In May 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 Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
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Kent Man Sentenced for Piloting Aircraft Without Valid CertificateRead the Press Release
A Kent man was sentenced to two years of probation and one weekend of intermittent confinement after he previously pleaded guilty to flying an airplane without a valid airman’s certificate in June 2019. Delbert Garfield Stewart, 71, was sentenced by U.S. District Judge Solomon Oliver, Jr., on Monday, August 8, 2022, and was also ordered to pay a fine of $5,000.
According to court documents, on three separate occasions, between June 2019 and March 2021, Stewart piloted a Bellanca Model 17-30A single-engine aircraft without a valid certificate. Court records show that Stewart obtained a private pilot certificate through the Federal Aviation Administration (FAA) in 1978. Additionally, court documents state that Stewart purchased the Bellance aircraft in October 2010, registered to his address in Kent, Ohio.
On November 14, 2013, the FAA notified Stewart of a 180-day suspension of his pilot certificate due to numerous FAA violations, specifically those that occurred during a September 2, 2013, flight from Paulding Northwest Atlanta Airport in Atlanta, Georgia, to Portage County Airport in Ravenna, Ohio.
During this incident, the FAA stated that Stewart piloted his aircraft under conditions in which he was not authorized to fly and climbed to an elevation without notifying air traffic control. Stewart responded to the FAA notice claiming that the FAA did not have jurisdiction over him as a private individual not engaged in commerce. The FAA suspended Stewart’s certificate on February 6, 2014. Stewart’s certificate remained suspended until the FAA revoked the certificate in October 2019, after Stewart had piloted the plane and landed without the landing gear fully extended.
Court records state that on separate occasions between June 2019 and March 2021, Stewart piloted his aircraft despite the February 2014 suspension and October 2019 revocation. Court documents describe these incidents as such:
- On June 20, 2019, Stewart piloted the aircraft from Portage County Regional Airport (KPOV) in Ravenna, Ohio, and landed at the Warsaw Indiana Airport (KASW) in Warsaw, Indiana. While in Indiana, Stewart flew the aircraft on multiple flights with passengers on board.
- On July 5, 2020, Stewart piloted and landed the aircraft at KPOV with a passenger on board. An FAA official advised Stewart that his airmen certificate was revoked and that the airworthiness certificate for the aircraft was also suspended.
- On March 8, 2021, Stewart flew from Paulding Northwest Atlanta Airport (KPUJ) in Georgia to KPOV Airport. Prior to the flight, law enforcement advised Stewart that his airman certificate was revoked.
Prior to trial, Stewart filed motions to dismiss the charges against him, arguing, amongst other things, that neither Congress nor the FAA has the authority to regulate his conduct and their attempt to do so violated the Commerce Clause, as well as other Constitutional provisions. The Court denied the motions, finding that the Commerce Clause allowed Congress to pass laws regulating instruments of commerce, such as airplanes, even if the pilot was not flying for payment.
On April 18, 2022, Stewart was set to go to trial on the matter before Judge Solomon Oliver, Jr., in Cleveland. However, during jury selection, Stewart pleaded guilty to one count of flying an airplane without a valid airman's certificate on June 20, 2019.
This investigation was conducted by the U.S. Department of Transportation Office of Inspector General, Federal Aviation Administration, Department of Homeland Security, and Ohio State Highway Patrol. This case was prosecuted by Assistant United States Attorneys Damoun Delaviz and Brad Beeson.
Kansas Attorney Sentenced for Smuggling Heroin into Correctional CenterRead the Press Release
KANSAS CITY, Mo. – A Shawnee, Kansas, attorney was sentenced in federal court today for smuggling heroin to an inmate at the Western Missouri Correctional Center in Cameron, Mo., with whom she had a romantic relationship.
Juliane L. Colby, 44, was sentenced by U.S. District Judge Greg Kays to one year and one month in federal prison without parole.
On Feb. 8, 2022, Colby pleaded guilty to one count of conspiracy to distribute heroin. Colby admitted that she conspired with others to smuggle heroin to an inmate at the Western Missouri Correctional Center, identified in court documents as Conspirator 1, from Aug. 1 to Aug. 10, 2019.
Colby hid the heroin in an envelope marked as “Legal Mail” that also contained numerous pleadings and documents from an inactive criminal court case along with photos of herself. Eight small baggies that contained a total of 3.25 grams of black tar heroin were taped behind the flap of the envelope. The envelope was labeled with a fictitious return address for a law firm and addressed to another inmate, identified in court documents as Conspirator 2, who was housed in the same unit as Conspirator 1.
According to court documents, Colby began a romantic relationship with Conspirator 1 while she was working as an attorney on his defense team with the state public defender’s office in 2017. Conspirator 1 was represented by a public defender at that time and was an inmate at the Jackson County Detention Center facing a charge of first-degree murder. While the murder case was pending, Conspirator 1 was found to have illegally possessed a cell phone that had been smuggled into the jail. Colby and Conspirator 1 communicated with each other using the contraband cell phone. As a result, Colby faced criminal charges for acting in concert in possession of a cell phone in a correctional facility. She entered a diversion agreement, which she successfully completed on May 14, 2019, and the charges were dismissed.
In August 2019, Colby regularly visited Conspirator 1 at the Cameron correctional center, where he was serving a sentence for his murder conviction. Colby and Conspirator 1 had a series of phone conversations during which they used a variety of code words to discuss the plan to mail heroin and contraband into the center. During these calls, Colby and Conspirator 1 also discussed a previous successful delivery of heroin. These calls were monitored and recorded by the correctional center.
This case was prosecuted by Assistant U.S. Attorney Brent Venneman. It was investigated by the FBI, the U.S. Postal Inspection Service, the Cameron, Mo., Police Department, and the Missouri Department of Corrections.
KC Man Shot Himself Before Being Arrested, Sentenced to 15 Years for Illegal FirearmRead the Press Release
KANSAS CITY, Mo. – A Kansas City, Mo., man who shot himself in the buttocks before being arrested was sentenced in federal court today for illegally possessing a firearm.
Herbert Lee Jones, 55, was sentenced by U.S. District Judge Roseann Ketchmark to 15 years in federal prison without parole.
On Jan. 4, 2022, Jones pleaded guilty to one count of possessing a controlled substance and one count of possessing a firearm in furtherance of a drug-trafficking crime.
Jones admitted that he was in possession of a loaded Beretta 9mm semi-automatic pistol with a magazine with 15 rounds on Feb. 14, 2020, when he was stopped by a Kansas City police detective. The detective saw Jones, who had an outstanding arrest warrant, walking on Quincy Avenue south of 23rd Street. The detective attempted to stop him, but Jones started running away. When the detective caught up with him, he took Jones to the ground; during the struggle, the detective pulled a backpack off Jones. Jones broke free and began to run again, but the detective caught him and took him into custody. Police officers recovered the backpack, which contained the pistol, loose .40-caliber rounds, a plastic baggie that contained 4.3 grams of cocaine, a plastic baggie that contained 1.44 grams of methamphetamine, and two pill bottles that were not labeled and contained random pills that included opioids.
On Nov. 2, 2020, Kansas City police officers attempted to arrest Jones on another outstanding warrant, but he ran into his apartment. As officers watched the apartment building, they heard three gunshots from inside the apartment, approximately 10 seconds apart. After the second gunshot, Jones’s girlfriend left the apartment. After the third gunshot, Jones left the apartment and was arrested. Jones, who had shot himself in the right buttocks, was transported to St. Luke’s Hospital. Officers searched the apartment and found an SCCY 9mm semi-automatic pistol laying on the bed.
Jones later told investigators that he had attempted to shoot himself in the head, but his girlfriend hit his arm away and the gun went off. The second shot occurred when he was laying down with the gun pointed towards his buttocks.
Under federal law, it is illegal for anyone who has been convicted of a felony to be in possession of any firearm or ammunition. Jones has two prior felony convictions for robbery, two prior convictions for possession of a controlled substance, two prior felony convictions for attempted distribution of an imitation controlled substance, and prior felony convictions for larceny and possession of a controlled substance with intent to sell.
This case was prosecuted by Assistant U.S. Attorney Trey Alford. It was investigated by the Kansas City, Mo., Police Department.
Project Safe Neighborhoods
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.
KC Man Fired into Home Occupied by Mother, InfantRead the Press Release
KANSAS CITY, Mo. – A Kansas City, Mo., man was sentenced in federal court today for illegally possessing the firearm he used to shoot into a home occupied by a woman and her infant child.
Bernard Manuel, 34, was sentenced by U.S. District Judge Greg Kays to 10 years in federal prison without parole. Today’s sentence reflects an eight-year term of imprisonment for Manuel’s conviction in this case plus a two-year term of imprisonment for violating the terms of his supervised release, which the court ordered to be served consecutively for a total of 10 years.
On Dec. 1, 2021, Manuel pleaded guilty to being a felon in possession of a firearm. Manuel admitted that he was in possession of a loaded Taurus 9mm semi-automatic handgun that had been stolen.
According to court documents, Kansas City police officers responded to a report of gunshots fired on the morning of April 1, 2021. A bullet had entered a residence on the 90th block of Kentucky Avenue, which at the time was occupied by a woman and her infant son. Thirteen 9mm shell casings were found in the street.
That evening, a 911 call alerted police that Manuel, whom the caller believed to be the shooter, was in a Chevrolet Impala with a gun on his lap at 43rd Street and Indiana Avenue. When police officers approached Manuel’s vehicle they saw bullet holes on both the driver’s side and passenger’s side of the vehicle. When Manuel got out of the vehicle, the handgun fell from his lap. Officers also found two rounds of 9mm ammunition in an ammunition box in the Impala’s driver-side door. A lab analysis confirmed that one of the 9mm shell casings found in the street after the shooting earlier in the day was fired from Manuel’s handgun.
Under federal law, it is illegal for anyone who has been convicted of a felony to be in possession of any firearm or ammunition. At the time of this offense, Manuel was still serving a term of supervised release for a 2012 conviction for being a felon in possession of a firearm. Manuel was convicted of robbery in 2006; while on probation for that felony, he was convicted of burglary. While on probation for robbery and burglary, he was convicted in federal court of being a felon in possession of a firearm. Following federal incarceration, Manuel violated the terms of his supervised release and was sentenced to an additional year in prison, followed by a year of supervised release. His second term of supervised release began on Jan. 22, 2021 – less than three months before this offense.
This case was prosecuted by Assistant U.S. Attorney Nicholas P. Heberle. It was investigated by the Kansas City, Mo., Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Project Safe Neighborhoods
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.
Justice Department Awards Nearly $3 Million in Grants to the State of LouisianaRead the Press Release
U.S. Attorney Ronald C. Gathe, Jr. announced that the Department of Justice’s Bureau of Justice Assistance has awarded $2,986,000 collectively to Louisiana State Police and East Baton Rouge Sheriff’s Office.
Louisiana State Police was awarded $2,300,000 to be used to initiate and host the first Law Enforcement Symposium, focusing on De-Escalation, Use of Force Tactics, Less Lethal Weapons Uses, and Advanced Scenario Training. These symposiums will be in conjunction with the purchase and deployment of Virtual Reality Scenario-Based training platforms.
East Baton Rouge Parish Sheriff’s Office was awarded $686,000 to be used for a pilot Rapid DNA program for processing reference samples and single-source crime scene evidence. Rapid DNA provides an opportunity to impact investigations by providing investigative leads in real-time.
Inland Empire Man Sentenced to 25 Years in Federal Prison for Coercing 9-Year-Old Girl to Produce Child PornographyRead the Press Release
RIVERSIDE, California – A federal judge has ordered a Fontana man to serve a quarter-century in a federal prison for enticing girls as young as 9 years old to film themselves in sexually explicit ways, sometimes in exchange for online gaming currency, the Justice Department announced today.
Jonathan Garcia, 28, was sentenced late Monday afternoon to 300 months in prison. In addition to the 25-year sentence, United States District Judge Jesus G. Bernal ordered that Garcia be on supervised release for 20 years after he is released from custody.
Garcia pleaded guilty on May 2 to one count of production of child pornography. In his plea agreement, Garcia admitted he posed as a 15-year-old boy and had online conversations with a 9-year-old girl. In his plea agreement, Garcia admitted he was enticed the victim to send him “naughty” pictures in exchange for Robux, a currency that can be used on the Roblox online gaming platform.
In November 2019, the victim made three sexually explicit videos that she sent to
Garcia through online messaging services. The victim’s mother discovered the online communications with Garcia and alerted the Ontario Police Department, which opened an investigation.When police executed a search warrant at Garcia’s residence, officers recovered several phones containing child pornography. Furthermore, during an interview with police, Garcia “admitted to contacting other minor girls online for photos and videos since 2015 and estimated that he probably contacted between 50-100 girls,” according to the plea agreement. Law enforcement discovered meticulously maintained digital folders containing numerous photos and videos of girls who were approximately 11 to 14 years old, and who had been enticed and solicited by Garcia to send the images.
Garcia’s “actions involved harm to real, multiple, children,” prosecutors said in a sentencing memorandum filed with the court. “This was not a one-time error in judgement or slip in impulse control but a years-long, premediated, campaign to satisfy his sexual interest.”
Garcia has been in federal custody since his arrest pursuant to a grand jury indictment in March 2020.
The FBI and the Ontario Police Department conducted the investigation in this matter.
Assistant United States Attorney Sonah Lee of the Riverside Branch Office prosecuted this case.
Husband & wife sentenced to 60 years & 20 years in prison for sexual exploitation, child pornography crimesRead the Press Release
COLUMBUS, Ohio – A Bexley, Ohio, couple were sentenced in federal court last evening for their crimes related to the sexual abuse of minor children.
Stephen Wilson, 39, was sentenced to 720 months in prison for the sexual exploitation of minors, and Jessica Wilson, 38, was sentenced to 240 months in prison for distributing and receiving child pornography.
Their crimes included creating child pornography videos and pictures of sexual abuse while exchanging text messages discussing the abuse.
According to court documents, from 2016 until 2021, Stephen Wilson sexually abused at least three minors between the ages of 7 and 16. Stephen had video cameras inside his home, including his bedroom, and used those cameras to document and create videos and still images of the abuse. He also filmed and photographed the sexual assault of the minor children with his cell phone.
In one incident, Stephen drugged a minor victim with alcohol and ecstasy and raped the victim while she was semi-conscious-to-unconscious. He created a 22-minute video depicting that sexual assault. In another incident, Stephen used a handheld camera to film his penis near the face of a seven-year-old child while he showed the minor adult pornography of himself and Jessica Wilson.
Stephen created hundreds of still images from the videos of him sexually assaulting minors. He also possessed hundreds of child pornography images depicting the abuse of children as young as toddler age. Additionally, Stephen possessed at least 25 images in which he had photoshopped his genitalia onto images of minor children, including prepubescent and toddler aged females, to give the effect of those children engaging in sexual activity with him.
Jessica was present for or aware of the sexual assaults that were perpetrated by Stephen. She and Stephen continued to engage in conversations about the sexual assaults of the minor children, exchanging still images of the videos that Stephen had created and fantasizing about them together.
On several occasions, Jessica exchanged numerous files of child pornography with Stephen, discussing those files at length in text conversations and even seeking advice from Stephen on where she could access child pornography online. Thousands of text messages were recovered between the two of them, during which, the Wilsons exchanged pornographic images of victims as young as one to eight months old.
Stephen and Jessica Wilson were both arrested locally in January 2021. A federal grand jury indicted the defendants in April 2021.
Kenneth L. Parker, United States Attorney for the Southern District of Ohio; J. William Rivers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Division; and Bexley Police Chief Gary D. Lewis, Jr. announced the sentences imposed by Chief U.S. District Court Judge Algenon L. Marbley. Assistant United States Attorney Emily Czerniejewski and Senior Litigation Counsel Heather A. Hill are representing the United States in this case.
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Hopkinsville Man Charged with Federal Drug Trafficking and Firearm OffensesRead the Press Release
Paducah, KY – A federal grand jury returned an indictment today charging Buddy Chambless with drug trafficking and firearms offenses.
According to court records, Buddy Chambless, 38, of Hopkinsville, Kentucky, is charged with possession with the intent to distribute methamphetamine and being a prohibited person in possession of a firearm. Chambless has a prior felony conviction for trafficking methamphetamine while armed. The indictment seeks forfeiture of over a dozen firearms that were seized during the course of the investigation.
Chambless will be scheduled to make an initial court appearance before a U.S. Magistrate Judge in the U.S. District Court for the Western District of Kentucky. If convicted, Chambless faces up to 40 years in prison. There is no parole in the federal system. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
U.S. Attorney Michael A. Bennett of the Western District of Kentucky and Special Agent in Charge R. Shawn Morrow of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Louisville Field Division made the announcement.
The ATF and the Christian County Sheriff’s Office are investigating the case.
Special Assistant United States Attorney Aimee Clymer-Hancock and Assistant United States Attorney Leigh Ann Dycus 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.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
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Grant County man admits to methamphetamine chargeRead the Press Release
ELKINS, WEST VIRGINIA – Jeffrey McKinley Rodgers, of Petersburg, West Virginia, has admitted to a drug charge, United States Attorney William Ihlenfeld announced.
Rodgers, 31, pleaded guilty today to one count of “Possession with Intent to Distribute Methamphetamine.” Rodgers admitted to having more than five grams of methamphetamine in July 2021 in Grant County.
Rodgers faces at least five and up to 40 years of incarceration and a fine of up to $5,000,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Stephen D. Warner is prosecuting the case on behalf of the government. The Potomac Highlands Drug Task Force, a HIDTA-funded initiative, and the West Virginia State Police investigated.
U.S. Magistrate Judge Michael John Aloi presided.
Georgia nurse practitioner sentenced to prison, ordered to pay more than $1.6 million in restitution in complex telemedicine fraud schemeRead the Press Release
AUGUSTA, GA: A Rockdale County, Ga., nurse practitioner has been sentenced to federal prison and ordered to pay more than $1.6 million in restitution for her role in a massive telemedicine fraud scheme.
Sherley L. Beaufils, 44, of Conyers, Ga., was sentenced to 87 months in prison after a U.S. District Court jury convicted her of participating in an illegal kickback conspiracy, and five counts each of Health Care Fraud, False Statements Related to Health Care, and Aggravated Identity Theft, said David H. Estes, U.S. Attorney for the Southern District of Georgia. Judge Dudley H. Bowen also ordered Beaufils to pay $1,635,161.61 restitution and to serve three years of supervised release after completion of her prison term. There is no parole in the federal system.
“Sherley Beaufils let greed take the wheel when she raked in massive profits by ordering unnecessary medical devices for patients she never examined or spoke to,” said U.S. Attorney Estes. “She targeted the elderly and medically vulnerable with her schemes, and is now being held accountable.”
As described in court documents and testimony, Beaufils, as a nurse practitioner, facilitated orders for more than 3,000 orthotic braces that generated more than $3 million in fraudulent or excessive charges to Medicare. Co-conspirators captured the identities of senior citizens, identified through a telemarketing scheme, and bundled that information as “leads.”
Beaufils then signed her name to fake medical records in which she falsely claimed she provided examinations of those patients, and then in exchange for money she created orders for orthotic braces for patients she never met or spoke with – including a knee brace for an amputee, and a back brace for a recently deceased patient – and for other durable medical equipment. Beaufils’ fraudulent orders were then sold to companies to generate reimbursement from Medicare.
“Beaufils exploited vulnerable populations, undermined patient trust, and wasted valuable taxpayer dollars in order to maximize her own profits,” said Special Agent in Charge Tamala E. Miles, with the Department of Health and Human Services, Office of Inspector General (HHS-OIG). “HHS-OIG, alongside our law enforcement partners, is committed to investigating and holding accountable those who engage in health care fraud.”
“Beaufils falsified medical records and examinations for her own personal greed,” said Keri Farley, Special Agent in Charge of FBI Atlanta. “We are proud of the work our agents and law enforcement partners are doing to end this abuse of taxpayers and the Medicare system.”
The case was investigated by the FBI and the U.S. Department of Health and Human Services Office of Inspector General, and prosecuted for the United States by Assistant U.S. Attorneys Jonathan A. Porter and Patricia G. Rhodes.
Gastonia Man Is Sentenced to Prison for Robbing A Convenience Store at GunpointRead the Press Release
CHARLOTTE, N.C. – Davonte Everett, 24, of Gastonia, N.C. was sentenced today to 121 months in prison and five years of supervised release for the armed robbery of a convenience store in Charlotte, announced Dena J. King, U.S. Attorney for the Western District of North Carolina.
Robert R. Wells, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Chief Johnny Jennings of the Charlotte-Mecklenburg Police Department join U.S. Attorney King in making today’s announcement.
According to filed documents and court proceedings, on July 3, 2020, Everett entered a 7-Eleven convenience store located at 2901 Yorkmont Road in Charlotte. Upon entering the 7-Eleven, Everett, who was wearing a hat and had his face covered, walked to the back of the store, picked up an item, and approached the cash register. When the store clerk opened the register to complete the sale, Everett pulled a black semiautomatic firearm from his pocket and pointed it at the clerk. Everett then reached over the counter and took cash from the register. As he did so, Everett’s head hit the plastic barrier over the counter knocking his hat off, and revealing his hair, eyes, and top of his face. Everett fled the scene with the store’s cash.
According to court records, a CMPD officer investigating the robbery recognized Everett and identified him as the robber. Everett was subsequently arrested on state charges. On March 31, 2022, Everett pleaded guilty to a federal Hobbs Act robbery offense and to brandishing a firearm during and in relation to, and in furtherance of, a crime of violence.
Everett is currently in federal custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.
In making today’s announcement, U.S. Attorney King thanked the FBI and CMPD for their investigation of the case.
Assistant United States Attorney Taylor G. Stout, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.
Fresno Man Sentenced to 12 Years in Prison for Possession of Methamphetamine with Intent to DistributeRead the Press Release
FRESNO, Calif. — Leslie Hood, 59, of Fresno, was sentenced Monday by U.S. District Judge Dale A. Drozd to 12 years in prison for possession of methamphetamine with intent to distribute, U.S. Attorney Phillip A. Talbert announced.
According to court documents, in June 2016, Hood brought several packages to a FedEx location in Fresno for shipment to North Carolina. Inside of each package was a children’s toy that had a bag of methamphetamine concealed inside it. The total weight of actual methamphetamine seized from all packages was in excess of 200 grams.
This case was the product of an investigation by the Drug Enforcement Administration, the Fresno County Sheriff’s Office, and the Federal Bureau of Investigation. Assistant U.S. Attorneys Michael Tierney and Jessica Massey prosecuted the case.
Hood has been in custody since his arrest in 2017. Co-defendant Richard Ormond was sentenced in April 2018 to 10 years in prison. Co-defendant Sharron Aycock was sentenced in March 2018 to three years in prison.
This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at www.justice.gov/OCDETF.
Four Texas Men Are Sentenced for Drug TraffickingRead the Press Release
CHARLOTTE, N.C. – U.S. District Judge Kenneth D. Bell sentenced to prison today four Texas men for trafficking more than 14 kilograms of cocaine, announced Dena J. King, U.S. Attorney for the Western District of North Carolina.
Ronnie Martinez, Special Agent in Charge of Homeland Security Investigations (HSI) in North Carolina and South Carolina, joins U.S. Attorney King in making today’s announcement.
Miguel Angel Mares, 35, of Dallas, Texas, David Mondragon, 38, of Houston, Texas, and Juan Carlos Mendoza, 40, of Laredo, Texas, were each sentenced to 10 years in prison followed by five years of supervised release. Milton Rivera-Cubas, 31, a Honduran national residing in Garland, Texas, was sentenced to 57 months in prison and five years of supervised release.
According to filed documents and court proceedings, from April 2021 to May 2021, the defendants conspired with each other to traffic more than 14 kilograms of cocaine. Over the course of the investigation, an undercover HSI agent made arrangements with the co-conspirators for the delivery of the cocaine from Texas to Charlotte. In May 2021, all four defendants traveled into Charlotte to facilitate the delivery.
Each defendant pleaded guilty to conspiracy to distribute and to possess with intent to distribute cocaine and possession with intent to distribute cocaine and aid and abet the same. They are currently in federal custody and will be transferred to the custody of the federal Bureau of Prisons upon designation of a federal facility.
In making today’s announcement, U.S. Attorney King commended HSI for their investigation and thanked the North Carolina State Highway Patrol and the Gaston County Police Department for their assistance.
Assistant United States Attorneys Regina Pack and Christopher Hess, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.
Four Charged with $150 Million Fraud on San Diego Technology CompanyRead the Press Release
Assistant U. S. Attorneys Meghan E. Heesch, Nicholas W. Pilchak, and Eric R. Olah
NEWS RELEASE SUMMARY – August 9, 2022
SAN DIEGO – Charges unsealed today against four individuals, including two San Diego residents, allege that they defrauded a multinational San Diego technology company in its $150 million purchase of a tech start-up controlled by the defendants.
Karim Arabi (“Karim”) and Ali Akbar Shokouhi were arrested today in San Diego, while Sanjiv Taneja was arrested in the Northern District of California. A fourth defendant was arrested in Canada, where she faces proceedings to extradite her to the United States.
All four defendants are named in a superseding indictment, which charges them with fraud and money laundering offenses based on the quartet’s alleged scheme to dupe a San Diego technology company (the “victim company”) into paying $150 million for technology that Karim secretly created and provisionally patented while serving as a vice president of research and development at the victim company. The charges subject the defendants to possible maximum statutory penalties of 20 years in prison; fines of $250,000 or twice the pecuniary gain/loss for the fraud charges or $500,000 for the money laundering charges; and the forfeiture of property which constitutes or is derived from proceeds of the fraud offenses and all property traceable to such property, as well as forfeiture of all property involved in the money laundering offenses.
Per the superseding indictment, as Abreezio LLC’s CEO, Taneja marketed Abreezio LLC’s valuable new microchip technology to the victim company in 2015. Taneja and his associates claimed throughout the marketing process that Abreezio’s valuable new technology was invented by a Canadian graduate student working in an unrelated field. But no one disclosed that Karim—the graduate student’s family member, and a specialist in the same field as Abreezio’s technology, then working at the victim company—was intimately involved in Abreezio’s formation, development and marketing. In truth, per court documents, Karim filed the provisional patents upon which Abreezio’s core technology was based; called and attended key operations meetings among the defendants and other Abreezio principals (but not the purported inventor); and choreographed key steps in the new company’s development—including the selection of Taneja as CEO and picking the name “Abreezio.”
The defendants concealed Karim’s key role in Abreezio from the victim company because, as detailed in the superseding indictment, Karim’s employment agreements provided that his inventions during his employment would belong to his employer, the victim company. By hiding Karim’s participation in Abreezio, the defendants were able to pitch the new company as “an angel-funded Silicon Valley based design IP start-up” entitled to a hefty fee for its valuable technology, while disguising the victim company’s own legal rights to the very same technology.
The indictment alleges that Karim hid his hand in Abreezio, in part, by creating sham email accounts to impersonate the purported inventor. Karim, Taneja and Shokouhi even called Karim by the purported inventor’s name in some of their communications to mask Karim’s role.
Abreezio also relied on Karim to provide important inside information about the victim company’s existing technology, to be used in honing Abreezio’s marketing pitch. In February 2015, per court documents, Taneja emailed Karim asking for insight on the victim company’s “numbers” for comparable technology then in place to identify “the ‘threshold’ we need to cross at [the victim company]” and “help us calibrate our positioning going in[.]”
The defendants also worked to hide Shokouhi’s involvement in Abreezio, per charging documents. Shokouhi had been a vice president at the victim company as recently as 2014, and funded and supported Abreezio’s development via three different entities that he controlled. One of Shokouhi’s companies was never disclosed to the victim company during due diligence, however—an attempt to avoid scrutiny, in part because the victim company had flagged conflict of interest issues with Shokouhi and the undisclosed company the year before the Abreezio sale.
In October 2015, the victim company purchased Abreezio for $150 million. As part of the transaction, the victim company was told that Abreezio was the sole and exclusive owner of its technology, and that everyone involved in the conception and development of Abreezio’s intellectual property had been disclosed. In reality, the defendants had carefully concealed Karim’s role from the victim company. As a result, the victim company paid nearly $92 million to Karim’s family member (the purported inventor), over $10 million to Taneja, and more than $24 million to two entities controlled by Shokouhi.
The indictment also alleges how the defendants laundered the funds they received from the Abreezio purchase, including via foreign real estate purchases and interest-free loans.
“Fraudsters cannot hide behind sophisticated technology or complex schemes,” said U.S. Attorney Randy S. Grossman. “This office will pursue criminals and their laundered, ill-gotten gains whether they are hidden in a mattress or scattered throughout the international financial system. Those who steal from our community will face justice.”
“Corporate fraud is a serious crime with serious consequences, not only hurting the individual organization, but also impacting shareholders, as well as entire communities,” said Acting Special Agent in Charge Thomas Ryan of the FBI’s San Diego Field Office. “Today's arrests confirm that no matter how criminals try to hide, the FBI will work with our law enforcement partners to fully investigate these crimes – we will uncover the truth; we will find the perpetrators; we will pursue justice for the victims.”
“Intellectual property crime threatens our economic wellbeing, and this indictment demonstrates that we will pursue those who attempt to steal and profit from our nation’s innovations,” said Acting Special Agent in Charge Darren Lian of IRS Criminal Investigation’s Los Angeles Field Office. “Schemes like this not only victimize companies, but also impact our U.S. Patent and Trademark Office and our Civil Courts. IRS Criminal Investigation is proud to work with our law enforcement partners to bring these defendants to justice.”
DEFENDANTS Case Number 22-CR-1152-BAS
Karim Arabi Age: 56 San Diego, CA
Sanjiv Taneja Age: 59 Cupertino, CA
Ali Akbar Shokouhi Age: 63 San Diego, CA
AGENCIES
Federal Bureau of Investigation
Internal Revenue Services, Criminal Investigation
United States Marshals Service
*The charges and allegations contained in an indictment are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Former Investment Adviser Sentenced to Five Years for Defrauding his Clients of More than $7 MillionRead the Press Release
PHILADELPHIA – United States Attorney Jacqueline C. Romero announced that Lee D. Weiss, 51, of Roslyn, NY, and Newton, MA, was sentenced today to five years in prison, three years of supervised release, and was ordered to pay $7.5 million in restitution and a $250,000 fine for his conviction of investment adviser fraud. The charges arose from Weiss’ multi-year investment scam that targeted his own clients and caused investor losses of more than $7 million.
In March 2022, the defendant pleaded guilty to investment adviser fraud in connection with this scheme to defraud his clients. Weiss was the principal of Family Endowment Partners, LP, an investment adviser registered with the U.S. Securities and Exchange Commission, which had an office in West Chester, PA, before it was closed by order of the SEC. The defendant used his position to fleece his own clients of millions of dollars through purported investments in a now-defunct Florida tobacco company and a series of private securities offerings. Weiss told his clients that their money would be used for investment purposes when, in fact, he diverted it to make Ponzi payments and to fund his lifestyle, and further told his clients that they were making money when their funds had already been misappropriated. Weiss continued to lie to them about the value of their investments to prevent them from learning of his thefts and to convince them to continue paying him fees for “managing” their money.
“Honesty, integrity, and trust all play a critical role in the relationship between a financial advisor and a client; when the advisor corrupts that relationship, the damage done to the financial security of the client can be catastrophic,” said U.S. Attorney Romero. “The end result is as devastating and traumatic as if the victim had been robbed at gunpoint, and therefore we take it just as seriously. We will continue to hold accountable those who, like Mr. Weiss, commit life-shattering financial crimes.”
“Lee Weiss’s clients expected him to invest their money responsibly and he had a fiduciary duty to do so. Instead, he misappropriated millions for his and his company’s purposes,” said Jacqueline Maguire, Special Agent in Charge of the FBI’s Philadelphia Division. “He used their funds for everything from car payments, to country club fees, to payouts to previous investors. Justice demands that financial fraudsters like Weiss be held accountable for their crimes and today’s sentencing ensures that.”
“The Postal Inspection Service has a long history of investigating investment frauds,” said Damon Wood, Inspector in Charge of the Philadelphia Division of the Postal Inspection Service. “Today, Lee Weiss was sentenced for stealing millions of dollars from his clients, clients who had trusted him to invest their money in safe, blue-chip investments. Through a web of corporate entities, Mr. Weiss hid the reality of his investment strategy and his failing business and stole his clients’ money to cover his own losses and continue living well. Thanks to the hard work of the Postal Inspectors, special agents from the FBI and the Assistant United States Attorneys, Mr. Weiss has been held accountable for his deceitful practices.”
The case was investigated by the Federal Bureau of Investigation and the U.S. Postal Inspection Service, and is being prosecuted by Assistant United States Attorneys Paul Shapiro and Nancy E. Potts. The U.S. Attorney’s Office appreciates the substantial assistance of the U.S. Securities and Exchange Commission in this matter.
Former Boston Public School Dean who Recruited Students into Latin Kings Gang Pleads GuiltyRead the Press Release
BOSTON – A former member of the Massachusetts Almighty Latin King and Queen Nation (Latin Kings) who was at the time an academic dean in the Boston Public Schools pleaded guilty today in federal court in Boston to racketeering charges. The defendant attempted to murder a student that he had recruited into the gang and who was selling marijuana in the high school at the defendant’s direction.
Shaun Harrison, a/k/a “Rev,” 63, pleaded guilty to conspiracy to conduct enterprise affairs through a pattern of racketeering activity, more commonly referred to as RICO conspiracy. Under the terms of the plea agreement, Harrison faces a sentence of 218 months, or approximately 18 years, in prison. U.S. Senior District Court Judge Rya W. Zobel scheduled sentencing for Nov. 15, 2022. Harrison is the 60th and final defendant in the case to plead guilty in the case. Two defendants remain wanted on federal arrest warrants.
“Mr. Harrison stole the youth and innocence from impressionable minors, exploiting his position of trust to corrupt and coerce vulnerable and at-risk children into a world of criminal activity. And, but for a miracle, he nearly took a juvenile victim’s life, shooting him at point blank range in the back of the head. Much of this crime and violence was perpetrated while Mr. Harrison was an Academic Dean at a Boston Public School and on the City’s payroll. He used his position of trust to find his victims and groom them. It is truly disgusting,” said United States Attorney Rachael S. Rollins. “For years, the Latin Kings terrorized our communities and targeted youth to join their violent criminal enterprise. No more. Thanks to the exceptional collaboration between our federal, state and local law enforcement partners, this dangerous organization has been dismantled. Today’s conviction of Mr. Harrison brings an end to the Latin Kings’ reign and offers accountability to the many victims and various communities harmed by each of the 60 total defendants the U.S. Attorney’s Office has prosecuted and convicted. And we remain diligent in our quest to find the two remaining defendants that fled and have active warrants. They can run, but they can’t hide. We will not stop until we find them.”
“This former high school dean and self-professed anti-violence advocate was supposed to be looking out for the best interests of his students, when in reality he was living a double life as a Latin King, engaging in violence while recruiting at-risk students to traffic drugs and further the insidious needs of the gang,” said Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division. “Shaun Harrison continued to associate with the Latin Kings while serving time on state charges behind bars and his conduct warrants his conviction today as a federal felon.”
In December 2019, a federal grand jury returned an indictment alleging racketeering conspiracy, drug conspiracy and firearms charges against dozens of leaders, members and associates of the Latin Kings.
The Latin Kings are a violent criminal enterprise comprised of thousands of members across the United States. The Latin Kings adhere to a national manifesto, employ an internal judiciary and use a sophisticated system of communication to maintain the hierarchy of the organization. As alleged in court documents, the gang uses drug distribution to generate revenue, and engages in violence against witnesses and rival gangs to further its influence and to protect its turf.
In 2015, Harrison was hired by the Boston Public Schools to serve as an academic dean at English High School. In that role, Harrison was to act as a mediator between teachers and students, contact families when students struggled, work with at-risk students and run an anger management program for 10 boys after school. While working at the Boston Public Schools, Harrison was a member of the Latin Kings, known as “Rev” or “King Rev,” and used his position as academic dean to recruit a number of the at-risk students into the Latin Kings gang. Harrison directed the recruited students to distribute marijuana and other drugs, which he provided, in the high school and collected the drug proceeds. A number of the students that Harrison recruited included Wilson Peguero, a/k/a “King Dubb,” who later became the “Inca” or the leader of the D5K Chapter of the Latin Kings; Alexis Peguero, a/k/a “King Lexi,” who became the “Cacique” or the second-in-command of the D5K Chapter of the Latin Kings; Dante Lara, a/k/a “King Nasty;” Oscar Pena, a/k/a “King O-Block;” and others. Wilson Peguero, Alexis Peguero, Lara and Pena were each charged in this case and sentenced to serve 30 months, 21 months, two years and 32 months in prison, respectively.
In March 2015, Harrison came to believe that one of the students distributing drugs for him had stolen money from him, no longer wished to sell drugs and may tell the police about Harrison’s crimes. On March 3, 2015, Harrison met up with this student at McDonalds. While walking behind the student, Harrison pulled out a handgun and shot the student in the back of the head at point blank range. This shooting was captured on video by a surveillance camera in the area. The student survived.
The student provided information to police concerning Harrison, his recruitment of students into the Latin Kings and the sale of drugs in the Boston Public Schools. Harrison was arrested soon thereafter and charged in Suffolk Superior Court with crimes related to the attempted murder. In 2018, Harrison was convicted by a jury and sentenced to approximately 25 years in state prison.
While in state prison following his conviction, Harrison continued to associate with Latin Kings members, including through jail calls to other co-defendants. Conversations between Harrison and other Latin Kings members included discussions about the identities of confidential informants in Harrison’s case and other efforts to identify those who contributed to his conviction. The Latin Kings supported Harrison during his state incarceration, discussed Harrison’s loyalty to the Latin Kings and refusal to implicate others and put money into his jail accounts.
The RICO conspiracy charge provides for a sentence of up to 20 years in prison, three years of supervised release and a fine of $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and statutes which govern the determination of a sentence in a criminal case.
U.S. Attorney Rollins; FBI SAC Bonavolonta; Commissioner Carol Mici of the Massachusetts Department of Correction; Suffolk County District Attorney Kevin Hayden; Boston Police Acting Commissioner Gregory Long; and New Bedford Police Chief Paul Oliveira made the announcement. Valuable assistance was also provided by the FBI North Shore Gang Task Force and the Bristol County and Suffolk County District Attorney’s Offices. Assistant U.S. Attorney Philip A. Mallard of Rollins’ Organized Crime & Gang Unit prosecuted the case.
This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
The details contained in the charging documents are allegations. The remaining defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Five Individuals and Two Nursing Facilities Indicted on Charges of Conspiracy to Defraud the United States and Health Care FraudRead the Press Release
PITTSBURGH - Five individuals and two for-profit skilled nursing facilities in Southwestern Pennsylvania have been indicted by federal grand jury in Pittsburgh on charges of conspiracy to defraud the United States and related health care fraud charges, United States Attorney Cindy K. Chung announced today.
The 15-count Superseding Indictment, returned on August 5, 2022, named
- Sam Halper, age 39, of Miami Beach, Fla.
- Eva Hamilton, age 35, of Beaver, Pa.
- Susan Gilbert, age 61, of Lawrence, Pa.
- Michelle Romeo, age 46, of Hillsville, Pa., and
- Johnna Haller, 41, of Monaca, Pa., as co-defendants.
Also named in the Superseding Indictment were two nursing facilities operating in Western Pennsylvania, Comprehensive Healthcare Management Services, LLC d/b/a Brighton Rehabilitation and Wellness Center and Mt. Lebanon Operations, LLC d/b/a Mt. Lebanon Rehabilitation and Wellness Center.
The Superseding Indictment alleges that Halper, the CEO and part-owner of the two indicted skilled nursing facilities, among others, conspired with others to defraud the United States and commit healthcare fraud. The Superseding Indictment alleges two schemes: first, that management-level employees at two nursing facilities, Brighton Rehabilitation and Wellness Center and Mt. Lebanon Rehabilitation and Wellness Center, knowingly provided, or directed others to provide, falsified staffing records to the Pennsylvania Department of Health (DOH) during federally mandated surveys; and second, that the facilities, under the direction of Halper and two other regional directors, Michelle Romeo and Johnna Haller, made false statements in resident assessments, also called Minimum Data Set (MDS) assessments, provided to the government to increase Medicare and Medicaid reimbursements.
Count One of the Superseding Indictment charges Halper and the former Director of Nursing, Eva Hamilton, with, from in and around June 2018, to in and around January 2020, conspiring to defraud the United States by obstructing and interfering with the lawful governmental functions of the Centers for Medicare and Medicaid Services (CMS); that is, co-defendants Halper and Hamilton, as well as other co-conspirators conspired to interfere with and obstruct DOH in its ability to conduct valid federally mandated surveys of the care provided to residents at Brighton by knowingly falsifying staffing sheets provided to DOH in order to show that the facilities were in compliance with the conditions of participation in Medicare and PA Medicaid. Among other acts, co-defendants Halper and Hamilton, as well as other co-conspirators added the names of nursing staff who were not in the building on the dates listed on records provided to DOH to make it appear as though these nurses were working and providing direct care to residents. The co-defendants allegedly engaged in these acts in whole or in part, to avoid government sanctions, including a denial of payments for new admissions, additional monitoring, the imposition of civil monetary penalties, and other potential penalties.
Count Two of the Superseding Indictment charges these same individuals as well as Brighton, with, between on or about July 18, 2018, to on or about January 22, 2020, falsifying, concealing or covering up by trick, scheme or device material facts in connection with the delivery of or payment for health care benefits; that is, the co-defendants engaged in a scheme to provide falsified staffing sheets to DOH in order to show that Brighton was in compliance with the conditions of participation in Medicare and Medicaid, including that the facility had “sufficient” nursing staff to meet residents’ needs and that the facilities were operating and providing services in compliance with all applicable Federal, State, and local laws, regulations, and codes. Counts Three through Seven of the Superseding Indictment charge Hamilton and Brighton with making false statements in staffing records with the intent to impede, obstruct, and influence the investigation and proper administration of a matter within the jurisdiction of CMS, an agency of the United States.
Count Eight of the Superseding Indictment charges Susan Gilbert, the former Administrator of Mt. Lebanon Rehabilitation and Wellness Center and the current Administrator of another facility owned by Halper, with, from on or about October 10, 2018, to in and around March 2020, conspiring to defraud the United States by interfering with and obstructing DOH in its ability to conduct valid federally mandated surveys of the care provided to residents at Mt. Lebanon. Among other acts, the Superseding Indictment alleges that Gilbert and/or other co-conspirators directed administrative and management-level nursing staff and other employees to “clock-in” for shifts not actually worked. In doing so, Mt. Lebanon Rehabilitation and Wellness Center created falsified timecard documentation provided to DOH that made it appear as though these individuals were providing direct resident care, when in fact they were not in the building and therefore not providing direct resident care.
Count Nine charges Gilbert and Mt. Lebanon, with, on or about November 13, 2019, and continuing to on or about February 20, 2020, participating in a scheme to falsify, conceal or cover up by trick, scheme or device material facts in connection with the delivery of or payment for health care benefits; that is, the co-defendants engaged in a scheme to provide falsified staffing sheets to DOH in order to show that Mt. Lebanon had “sufficient” nursing staff to meet residents’ needs and that the facilities were operating and providing services in compliance with all applicable Federal, State, and local laws, regulations, and codes.
Counts Ten through Twelve charge Gilbert and Mt. Lebanon with making false statements with the intent to impede, obstruct, and influence the investigation and proper administration of a matter within the jurisdiction of CMS.
Count Thirteen charges Gilbert further with, in or around March 2020, participating in a scheme to falsify staffing records at another nursing facility in order to show that this facility was in compliance with the conditions of participation in Medicare and Medicaid.
In addition, Count Fourteen of the Superseding Indictment alleges, from in and around June 2014 to in and around June 2021, Halper conspired with two regional-level employees, Michelle Romeo and Johnna Haller, and others to commit healthcare fraud. Among other acts, the Superseding Indictment alleges that Romeo instructed nursing staff that completed MDS assessments at the various facilities she supervised to make changes to residents’ assessments to ensure that those facilities had certain Case Mix Index (CMI) score associated with higher reimbursements. Romeo and other co-conspirators also instructed staff at the facilities to create false documentation in residents’ MDS assessments to justify changing a resident’s Activities of Daily Living (ADL) score – a score intended to reflect a resident’s needs for assistance with daily living activities such as bed mobility, toilet use, and eating – by writing a note stating that the changes were made after “interviewing” nursing staff when in fact no such interviews were conducted.
Co-defendants Halper, Romeo and Haller and/or other co-conspirators also conspired to input inaccurate responses to certain resident questionnaires in order to falsely inflate residents’ depression scores. The Superseding Indictment alleges that Halper, Romeo and Haller directed these changes in the MDS data to increase reimbursements and not to accurately capture residents’ medical conditions or needs.
Count Fifteen of the Superseding Indictment charges Romeo and Haller, with from in and around December 2016 to in and around June 2021, with health care fraud related to their involvement in the submission of false information in the MDS assessments to receive higher reimbursements from Medicare and Medicaid.
“Our office will continue to hold individuals and facilities that break the law accountable,” said U.S. Attorney Chung. “Health care fraud is not a victimless crime. It affects everyone—individuals and businesses alike—and causes tens of billions of dollars in losses each year.”
“Through our joint investigation with the U.S. Attorney’s Office for the Western District of Pennsylvania and the Federal Bureau of Investigation, we found that Brighton and Mt. Lebanon’s senior administrators used two criminal schemes to take advantage of federal programs and make extra money while putting residents at risk,” said Pennsylvania Attorney General Josh Shapiro. “These charges today represent a dereliction of duty to report accurate information, criminal schemes designed to manipulate the system, and above all else, companies and individuals that put profits above truthful reporting. I am proud to stand with our federal partners and in unison say, we will not stand by while companies or those who run them break our laws and put people’s safety at risk.”
“Health care fraud impacts every American and destroys the basic trust between providers and patients,” said FBI Pittsburgh Special Agent in Charge Mike Nordwall. “Fraud and abuse take critical resources from across our health care system and contribute to the rising cost of health care for everyone. The FBI will continue to work with our partners to investigate and hold accountable those who exploit the health care system at the expense of patients.”
“Health care fraud will not be tolerated. It is a federal crime that carries serious consequences,” stated Special Agent in Charge Maureen Dixon of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG). “Working closely with our law enforcement partners, HHS-OIG remains committed to detecting and preventing illegal actions and holding parties who execute them accountable.”
“Today’s superseding indictment underscores the commitment of our office to bring this investigation to a thorough and complete conclusion,” said Yury Kruty, Special Agent in Charge of IRS-Criminal Investigation. “Actions like those outlined in the indictment are carried out for greed and can put people at risk. IRS-Criminal Investigation will continue working in a collaborative manner with our law enforcement partners to prosecute offenders who execute schemes like this.”
As to Counts One, Two, Eight, Nine and Thirteen, the law provides for a maximum total sentence of not more than five years in prison, a fine of $250,000 or both. Counts Three through Seven, and Ten through Twelve each carry a maximum possible sentence of twenty years in prison, a fine of $250,000 or both. Finally, Counts Fourteen and Fifteen each carry a maximum possible sentence of ten years in prison, a fine of $250,000 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendants.
Assistant United States Attorneys, Robert S. Cessar, Karen Gal-Or and Nicole A. Stockey are prosecuting this case on behalf of the government.
The Federal Bureau of Investigation, the U.S. Department of Health & Human Services – Office of Inspector General, the Pennsylvania Office of Attorney General, and the Internal Revenue Service – Criminal Investigation conducted the investigation leading the Superseding Indictment in this case.
An Indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
On December 18, 2023, a federal jury found Brighton Rehabilitation and Wellness Center guilty of Counts 2, 3, 4, 5, 6, and 7, and Mount Lebanon Rehabilitation and Wellness Center guilty of Counts 9, 10, 11, and 12. The jury acquitted the individual defendants Sam Halper, Eva Hamilton, Susan Gilbert, Michelle Romeo, and Johnna Haller of the charged offenses.
Fenton man admits soliciting child pornography from undercover officerRead the Press Release
ST. LOUIS – A man from Fenton, Missouri on Tuesday admitted soliciting nude pictures from an undercover St. Louis County police officer pretending to be a 16-year-old.
Robert L. Payne, 77, pleaded guilty in front of U.S. District Judge Ronnie L. White to a felony charge of solicitation of child pornography. Payne admitted that he repeatedly tried to talk to boys at Fenton City Park, 1215 Larkin Williams Road, and that his behavior sparked complaints to police.
St. Louis County Police spotted Payne at the park each day between March 1 and 4, 2021. On March 2nd, Payne reposition his vehicle in the park about eighteen times, including backing into a space to allow him to watch the Lindbergh High School boys’ lacrosse team practice. The next day Payne tried to engage about ten to twelve young males in conversation near the basketball courts.
On March 8, 2021, an officer pretending to be a 16-year-old played basketball at the park and then used a trashcan near Payne, who was sitting in his parked red 2003 Ford Ranger. Payne began talking to the officer, offered to perform oral sex on him and gave the officer his contact information.
Payne later contacted the officer and repeatedly offered to engage in sex acts with him before requesting a picture of the purported teen’s genitals.
Payne is scheduled to be sentenced in November. The crime carries a potential sentence of five to 20 years in prison.
As part of his plea, Payne admitted that in 2018, the Sunset Hills Police Department investigated him over allegations that he’d approached a 16-year-old male at Minnie Ha Ha Park and offered to perform oral sex on him. Payne later pleaded guilty to a harassment charge and was ordered to stay away from the park.
The case was investigated by the St. Louis County Police Department and the FBI. Assistant U.S. Attorney Jillian Anderson is prosecuting the case.
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. Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Fort Washakie Man Charged with Violent CrimeRead the Press Release
Acting United States Attorney Nicholas Vassallo announced today that KOBE CURTIS TILLMAN, age 20, of Fort Washakie, Wyoming, was charged with assault resulting in serious bodily injury, assault with a dangerous weapon, and using, carrying, brandishing, and discharging a firearm during and in relation to a crime of violence. Tillman appeared for an arraignment hearing on August 4, 2022, before Federal District Court Magistrate Judge Teresa McKee and pleaded not guilty to those charges. A trial has been set for October 3, 2022, and Tillman was remanded to the custody of the United States Marshal Service.
Tillman faces 10 years up to life imprisonment, up to five years of supervised release, a $750,000 fine, and a $300 special assessment. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
This crime is being investigated by the Federal Bureau of Investigation. Assistant United States Attorney Michael J. Elmore is prosecuting the case.
An indictment merely contains allegations, and every defendant is presumed innocent unless and until proven guilty.
Case No. 22-cr-00092-SWS
Expired license plate stop leads to firearm conviction for HonduranRead the Press Release
CORPUS CHRISTI, Texas – A federal jury in Corpus Christi has convicted a 27-year-old man for possession of a firearm, announced U.S. Attorney Jennifer B. Lowery.
The jury deliberated for approximately 45 minutes before convicting Carlos Javier Zelaya-Guerra following a two-day trial.
On Feb. 5, authorities stopped Zelaya-Guerra in Sinton for driving with an expired temporary license plate. At that time, Zelaya-Guerra admitted he had a firearm with him in the vehicle.
Zelaya-Guerra provided law enforcement with a Honduran passport, but did not have a driver’s license or any documentation allowing him to be in the United States lawfully.
Authorities later determined Zelaya-Guerra was present in the country illegally.
At trial, Zelaya-Guerra testified that he thought he had permission to be in the United States because he married a U.S. citizen who had initiated the paperwork necessary to obtain lawful status.
The jury did not believe his story and found him guilty as charged.
Zelaya-Guerra will remain in custody pending that hearing.
The San Patricio County Sheriff’s Office, Border Patrol and the Bureau of Alcohol, Tobacco, Firearms and Explosives conducted the investigation. Assistant U.S. Attorneys Joel Dunn and John Marck are prosecuting the case.
Defendant Who Assaulted Officer at San Ysidro Port of Entry Sentenced to 68 Months in PrisonRead the Press Release
Assistant U. S. Attorneys Paul E. Benjamin (619) 546-7579 and Colin M. McDonald (619) 546-9144
NEWS RELEASE SUMMARY – August 9, 2022
SAN DIEGO – Rene Robert Ruiz was sentenced in federal court to 68 months in prison for assaulting a Customs and Border Protection Officer at the San Ysidro Port of Entry when attempting to enter the United States from Mexico.
According to court records and trial testimony, on May 17, 2021, Ruiz walked towards the limit line separating the United States and Mexico at the San Ysidro Port of Entry. He was irate, yelling “f*** you!” at an officer near the line. As he reached the front of the line, Ruiz continued to yell at officers and made no effort to show documents permitting him to enter the United States. An officer told Ruiz he could not enter until he calmed down.
Ruiz responded, “F*** you, I’m a U.S. citizen, I’m coming in,” and attempted to push past the officer into the United States. Concerned for his safety, the officer pushed Ruiz back beyond the limit line. Immediately, Ruiz came back at the officer and punched him in the head with a closed fist. Ruiz then repeatedly struck the officer in the head as the officer attempted to restrain him. The officer suffered a concussion and other injuries because of Ruiz’s assaultive conduct. On October 13, 2021, following a two-day trial, a jury convicted Ruiz of two counts of assault on a federal officer.
At the sentencing hearing yesterday, U.S. District Judge Gonzalo P. Curiel observed that Ruiz attacked an officer who was simply doing his job. Judge Curiel further remarked that Ruiz’s assaultive conduct was the culmination of a thirty-year history of violence and disregard for law enforcement, including his self-admitted leadership role in a violent motorcycle gang. A restitution hearing to determine the financial penalty Ruiz owes to the officer is scheduled for August 29, 2022.
“This defendant viciously attacked a customs officer completing routine duties at the port of entry,” said U.S. Attorney Randy Grossman. “Law enforcement officers—such as the victim here—perform vital services for us all and must be allowed to do their jobs without the risk of harm. The U.S. Attorney’s Office will continue to vigorously prosecute those who place their safety and security at risk.” Grossman commended the excellent work of the prosecution team as well as officers and agents from Customs and Border Protection and Homeland Security Investigations.
“Violent acts like these against our officers will not be tolerated and we are thankful to the San Diego USAO for ensuring justice was served,” said Anne Maricich, acting Director of Field Operations for the San Diego Field Office.
“This case unfortunately serves as yet another example of the dangers encountered by agents and officers along the border,” said HSI San Diego Special Agent in Charge Chad Plantz. “This sentence should serve as a reminder that assaults on the officers who protect our borders will not be tolerated.”
DEFENDANT Case Number 21-cr-02911-GPC
Rene Robert Ruiz Age: 55 Residence: San Diego, California
SUMMARY OF CHARGES
8 U.S.C. § 111(a)(1) – Assault on a Federal Officer
Maximum penalty: Five years in prison; $250,000 fine.
8 U.S.C. § 111(a)(1) and (b) – Assault on a Federal Officer Inflicting Bodily Injury
Maximum penalty: Twenty years in prison; $250,000 fine.
AGENCIES
Homeland Security Investigations
Customs and Border Protection
Charlotte Woman Is Sentenced to Prison for Bank FraudRead the Press Release
CHARLOTTE, N.C. – Charles Morgan Harrell, 58, of Charlotte, was sentenced to five years in prison today for bank fraud, announced Dena J. King, U.S. Attorney for the Western District of North Carolina. Harrell was also ordered to serve two years of supervised release.
Tommy D. Coke, Inspector in Charge of the Atlanta Division of the U.S. Postal Inspection Service (USPIS), which oversees Charlotte, and Robert R. Wells, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, join U.S. Attorney King in making today’s announcement.
According to filed court documents and court proceedings, from Jan. 2020 to Feb. 2021, Harrell operated a bank fraud scheme in North Carolina, Georgia, Virginia, and elsewhere. To execute the scheme, Harrell targeted neighborhoods in the Charlotte area and stole mail from residential mailboxes. The stolen mail included individual and business checks, and personal identifying information (PII) of victims, which Harrell used to create fake identification documents in furtherance of the scheme.
As Harrell previously admitted in court, at times, Harrell altered the names of the payees on the stolen checks to the names of the identity theft victims and used the false identification documents to open bank accounts in the identify theft victims’ names and cash the checks. Other times, Harrell obtained blank checks which she fraudulently wrote in her name and then cashed. In addition to the check cashing scheme, Harrell also used the victims’ stolen identities to rent apartments and to buy at least one vehicle. In total, Harrell obtained more than $200,000 through the fraudulent scheme.
Harrell is currently released on bond and will be ordered to report to prison upon designation of a facility by federal Bureau of Prisons.
In making today’s announcement, U.S. Attorney King thanked the USPIS and the FBI for their investigation of the case.
Assistant United States Attorney Caryn Finley, of the U.S. Attorney’s Office in Charlotte, prosecuted the case.
California Man Pleads Guilty to Possession of Cocaine with Intent to DistributeRead the Press Release
Gulfport, Miss. -- A Lemon Grove, California man pled guilty to possession of cocaine with intent to distribute, announced U.S. Attorney Darren J. LaMarca and Special Agent in Charge Jermicha Fomby of the Federal Bureau of Investigation.
According to court documents, on October 8, 2021, Albert Joseph Jones, 31, was stopped by an agent with the South Mississippi Metro Enforcement Team for a traffic violation. Jones was the driver and sole occupant of the vehicle. A K-9 hit on the vehicle for the presence of narcotics. A search of the vehicle produced eighteen (18) heat-sealed packages of cocaine.
Jones is scheduled to be sentenced on November 16, 2022, at 1:30 p.m., in Gulfport. He faces a maximum penalty of 40 years in prison and a $5,000,000 fine. A federal district judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The case was investigated by the Federal Bureau of Investigation and its FBI Task Force, and the South Mississippi Metro Enforcement Team. It is prosecuted by Assistant U.S. Attorney Andrea Jones.
California Man Pleads Guilty to $3.5 Million Scam-PAC FraudRead the Press Release
A California man pleaded guilty yesterday in the Western District of Texas to conspiracy to solicit millions of dollars in contributions to two political action committees based on false and misleading representations that the funds would be used to support presidential candidates during and after the 2016 election cycle.
According to court documents, from 2016 through at least April 2017, Robert Reyes, Jr., 40, of Hollister, along with others, operated two political action committees—Liberty Action Group PAC and Progressive Priorities PAC—which solicited contributions from the public via robocalls and television, radio, and internet advertisements. The two PACs represented that the contributions would be used to support dueling presidential nominees of the two major political parties, respectively. Instead, Reyes and his co-conspirators used the funds to enrich themselves and to fund additional fraudulent solicitations. Specifically, Reyes admitted that the two PACs raised approximately $3.5 million in contributions during the 2016 election cycle and subsequent months, of which Reyes received approximately $714,000. Of the approximately $3.5 million raised, the two PACs contributed approximately $19 to legitimate political causes.
Additionally, to conceal the origin and nature of the proceeds of the fraudulent scheme, Reyes and others instructed a third-party vendor to withdraw approximately $353,000 from the two PACs in excess of the payments for services rendered, then deposit the excess payments into accounts held by shell companies that they controlled. Reyes admitted to operating additional fraudulent PACs beyond the 2016 election cycle, Support American Leaders and Campaign to Support the President, from which he received approximately $95,000 generated from false and misleading solicitations to donors.
As part of his plea, Reyes agreed to forfeit $809,920.40 that he received for his participation in the scam-PACs during the scheme.
Reyes pleaded guilty to one count of conspiracy to commit wire fraud and to cause false statements to the Federal Election Commission and one count of money laundering. Sentencing will be scheduled at a later date. He faces a maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division and Special Agent in Charge Oliver E. Rich of the FBI’s San Antonio Field Office made the announcement.
The investigation was conducted by the FBI’s San Antonio Division, Austin White Collar Crime Task Force.
Trial Attorneys Michael N. Lang and Celia Choy of the Criminal Division’s Public Integrity Section are prosecuting the case. Former PIN Trial Attorney Rebecca Schuman also contributed significantly to the investigation.
Buyer, Seller of ‘Sex Slave’ Sentenced to Combined 25 YearsRead the Press Release
Two human traffickers have been sentenced to a combined 25 years in federal prison, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.
Alfonso Orozco Juarez, 37, and Robert Hubert, 68, were first charged in October 2020. Mr. Hubert pleaded guilty in February 2022 to kidnapping and was sentenced in May 2022 to 121 months in federal prison; Mr. Juarez pleaded guilty in March 2022 to sex trafficking and was sentenced last week to 180 months in federal prison.
“Treated like chattel, the victim in this case endured horrors beyond imagining,” said U.S. Attorney Chad E. Meacham. “The North Texas Trafficking Task Force was launched to investigate and prosecute cases just like this one. We hope the sentences announced today will bring some peace to the victim as she recovers from her ordeal.”
“The physical and mental abuse suffered by the victim in this devasting sex-trafficking crime is heart-breaking. These perpetrators treated their victim as if she were personal property and not human,” said Special Agent in Charge Lester Hayes Jr., Homeland Investigations Dallas. “The HSI Dallas-led North Texas Trafficking Task Force will work relentlessly to eliminate these commercial sex-trafficking schemes. Fortunately, the defendants’ 25-year combined prison sentences will not allow them to target anyone else.”
According to plea papers, Mr. Juarez admitted that on Sept. 11, 2019, he authored a social media post advertising a sex “slave” who he claimed he had won in a card game. Mr. Hubert admitted that he responded to the post, offering to buy the “slave” for $5,000. In messages, Mr. Juarez referred to the victim as “property” and bragged that he “pistol whip[ped] her.”
On Sept. 18, 2019, the pair met at a gas station in Dallas, where Mr. Juarez handed over the victim in exchange for $5,000. On the drive back to his home, Mr. Hubert admitted, he clamped a metal collar around her neck.
Terrified, the victim texted Mr. Juarez, pleading for help:
“I’m afraid if I don’t do something, he’s going to hurt me,” she said.
“Endure what you have to,” he responded. “He’ll punish you whip you . . . but not kill you.”
Once they reached his home, Mr. Hubert admitted, he handcuffed her and forced her to sleep naked at the foot of his bed. The victim eventually persuaded him to allow her to call her parents, who agreed to his demand of $5,000 for safe return. Eventually, the victim was able to escape the home.
Homeland Security Investigations and the North Texas Trafficking Task Force conducted the investigation with substantial support from the Crime Strategies Unit with the 2nd Judicial District Attorney's Office in Albuquerque, NM. Assistant U.S. Attorneys Andrew Briggs and Rebekah Ricketts (fmr.) of the Northern District of Texas are prosecuting the case, with significant assistance from Assistant U.S. Attorney Letitia Simms of the District of New Mexico.
Brooklyn Company Sentenced for Price Gouging KN95 Masks During COVID-19 PandemicRead the Press Release
NEWARK, N.J. – A New York company was sentenced today to one year of probation and fined $314,165 for its role in price gouging a chain of New Jersey grocery stores in connection with the sale of KN95 masks during the COVID-19 pandemic, U.S. Attorney Philip R. Sellinger announced.
Milk & Honey Ventures LLC (MHV), based in Brooklyn, New York, previously pleaded guilty by videoconference before U.S. Magistrate Judge Jessica S. Allen to an information charging it with price gouging in violation of the Defense Production Act.
According to documents filed in this case and statements made in court:
In March 2020, MHV and two partners purchased 250,000 KN95 filtering facepiece respirators from a foreign manufacturer. MHV and one of those partners then sold 100,000 masks to a chain of New Jersey grocery stores at prices in excess of prevailing market prices. MHV sold the masks at a price of $5.25 per mask, which amounted to a markup of more than 400 percent from its acquisition cost. Prior to the spread of COVID-19, MHV had no history of selling personal protective equipment.
U.S. Attorney Sellinger credited special agents of the Department of Homeland Security, Homeland Security Investigations, under the direction of Acting Special Agent in Charge Ricky J. Patel in New York, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney David V. Simunovich of the Government Fraud Unit in Newark and Nicholas P. Grippo, Chief of the Criminal Division in Newark.
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.
Blind Rapper who goes by ‘Mac Wayne’ sentenced to six years in prison for drug distributionRead the Press Release
Seattle – A legally blind rapper who was profiled in an Amazon Prime documentary, was sentenced today in U.S. District Court in Seattle to six years in prison, announced U.S. Attorney Nick Brown. Wayne Frisby aka ‘Mac Wayne,’37, of Snohomish County, Washington was arrested in December 2020, for his role in a large drug trafficking ring. Investigators had numerous recorded phone calls of Frisby making drug deals and even one discussing his efforts to help a murder suspect hide from law enforcement. U.S. District Judge John C. Coughenour imposed four years of supervised release to follow prison, noting “the massive size of the conspiracy and the huge quantity of drugs involved.”
“Mr. Frisby gained notoriety through his drug dealing and self-promotion, but his conduct was serious and put countless lives at risk,” said U.S. Attorney Nick Brown. “Drug trafficking is a gritty, dangerous business, and one that is ruining lives across our state. Those who make it their life are destined to spend time behind bars.”
According to records filed in the case, Frisby was one of eleven people indicted in December 2020 in connection with a drug trafficking ring distributing heroin, methamphetamine, and fentanyl pills in Pierce, King, Snohomish, and Lewis Counties. The drug ring takedown was the third in a series of wiretap cases. All told, the search warrants executed in this case resulted in the seizure of approximately 93 pounds of methamphetamine, 15 pounds of heroin, 35,000 suspected fentanyl pills, 24 firearms, approximately $525,000, and a bank account valued at $100,000. Seizures made prior to December 16, 2020, included more than 154 pounds of methamphetamine, 20 pounds of heroin, and more than 7,000 suspected fentanyl pills.
Frisby was heard on the wiretap ordering up pound quantities of methamphetamine and significant amounts of heroin. Other recordings have him discussing firearms he carried or his efforts to assist a partner who shot another man in Marysville in a drug deal gone wrong.
Agents were able to identify Frisby as the person on the phone by comparing his voice to the Amazon Prime documentary, “Blind and Battered, the Blind Kingpin.” The documentary chronicles Frisby’s life and, in it, he freely discusses his work as a drug dealer and pimp.
On May 6, 2022, Frisby pleaded guilty to Conspiracy to Distribute Controlled Substances.
In asking for a 96-month sentence, prosecutors wrote to the court, “The risks of synthetic opioids, like methamphetamine, are well documented – according to the University of Washington Addictions, Drug & Alcohol Institute, state drug poisonings went up by approximately 30% in 2020, with methamphetamine and other synthetic opioids (mostly fentanyl) comprising “a growing share of drug-caused deaths.”
This case is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
The investigation was conducted by the U.S. Drug Enforcement Administration (DEA) Tacoma Residence Office in partnership with Tahoma Narcotics Enforcement Team (TNET), Kent Police Department, Homeland Security Investigations, SeaTac Police Department, Tacoma Police Department, Snohomish Regional Drug Task Force (SRDTF), the Skagit County Sheriff's Office, the Federal Bureau of Investigation, the Bureau of Alcohol Tobacco, Firearms and Explosives, and the Internal Revenue Service (IRS).
The case is being prosecuted by Assistant United States Attorneys Amy Jaquette and Andy Colasurdo.
Annapolis Drug Dealer Sentenced to 10 Years in Federal Prison After Pleading Guilty to Drug Conspiracy Involving Fentanyl, Heroin, PCP, and CocaineRead the Press Release
Baltimore, Maryland – Chief U.S. District Judge James K. Bredar sentenced Khayr Basimibnbrown, a/k/a “Keith Brown,” and “Shitty,” age 42, of Annapolis, Maryland, yesterday to 10 years in federal prison, followed by five years of supervised release, after Basimibnbrown pleaded guilty to conspiracy to possess with intent to distribute fentanyl, heroin, PCP, and cocaine.
The guilty plea and sentence were announced by United States Attorney for the District of Maryland Erek L. Barron; Acting Special Agent in Charge Robert Turner of the Federal Bureau of Investigation, Baltimore Field Office; Special Agent in Charge Jarod Forget of the Drug Enforcement Administration, Washington Division; Anne Arundel County Police Chief Amal E. Awad; Chief Edward Jackson of the Annapolis Police Department; and Anne Arundel County State’s Attorney Anne Colt Leitess.
According to Basimibnbrown’s guilty plea, law enforcement observed the defendants participate or conduct drug transactions on multiple instances. For example, Basimibnbrown participated in the sale of 600.9 grams of a heroin and fentanyl mixture in an Annapolis, Maryland hotel parking lot. After the transaction, law enforcement observed Basimibnbrown enter and exit several vehicles in an effort to avoid law enforcement detection.
As stated in his guilty plea, on January 13, 2022, law enforcement executed search warrants at eight residences in Annapolis, Maryland, including Basimibnbrown’s residence, a home that belonged to his grandmother, where officers located 470 grams of PCP, 55.5 grams of crack cocaine, 6.2 grams of heroin, and 71 grams of cocaine. At the home of Basimibnbrown’s cousin, which Basimibnbrown frequently visited, law enforcement seized 145.05 grams of cocaine, 67.19 grams of PCP, and 59.56 grams of a cutting agent, all found on the top shelf of a child’s bedroom closet. From the eight residences searched, law enforcement seized a total of $32,695 in cash, constituting drug proceeds.
Basimibnbrown admitted that he conspired to distribute more than 400 grams of fentanyl, as well as heroin, PCP, cocaine, and crack cocaine. Further, Basimibnbrown knew that he was on federal supervised release at the time he was committing these crimes.
United States Attorney Erek L. Barron commended FBI, DEA, the Anne Arundel County Police Department, the Annapolis Police Department, and the Anne Arundel County State’s Attorney’s Office for their work in the investigation. Mr. Barron thanked Assistant U.S. Attorneys Joan C. Mathias and LaRai Everett, who prosecuted the case. Mr. Barron also thanked Paralegals Kristy Penny, Damon Gasque, and Alisha Swiger for their assistance.
For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit www.justice.gov/usao-md and https://www.justice.gov/usao-md/community-outreach.
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Albany Man Pleads Guilty to Unemployment Insurance FraudRead the Press Release
ALBANY, NEW YORK – Kahleke Taylor, age 21, of Albany, pled guilty today to mail fraud, wire fraud and aggravated identity theft charges related to a scheme to obtain COVID-19 pandemic-related unemployment insurance benefits using the personal information of other people. Taylor admitted his fraud scheme resulted in a loss of $207,004 to the New York State Department of Labor (NYSDOL).
The announcement was made by United States Attorney Carla B. Freedman; Matthew Scarpino, Acting Special Agent in Charge of the Buffalo Field Office of Homeland Security Investigations (HSI); New York State Inspector General Lucy Lang; Jonathan Mellone, Special Agent in Charge, New York Region, United States Department of Labor, Office of Inspector General (USDOL-OIG); and Ketty Larco-Ward, Inspector in Charge of the Boston Division of the United States Postal Inspection Service (USPIS).
In his plea, Taylor admitted to soliciting personal information from other people on social media. He used the information to make false unemployment insurance applications on NYSDOL’s website. On one application he filed in August 2020, for example, Taylor certified that a person had lost work at a hotel in Latham, New York in March 2020 due to “Lack of Work – COVID,” all of which was false. From September 2020 through June 2021, the applications Taylor admitted to filing as part of the fraud scheme resulted in benefits payments of $207,004. Taylor has agreed to pay full restitution to NYSDOL.
Taylor’s mail fraud and wire fraud convictions each carry maximum terms of 20 years in prison, fines of up to $250,000, and terms of supervised release of up to 3 years. The aggravated identity theft conviction carries a mandatory term of 2 years in prison, to be imposed consecutively to any other term of imprisonment. Taylor is scheduled to be sentenced on December 8, 2022, by United States District Judge Mae A. D’Agostino. A defendant’s sentence is imposed by a judge based on the particular statutes the defendant is charged with violating, the U.S. Sentencing Guidelines, and other factors.
This case is being investigated by HSI, the New York State Inspector General’s Office, USDOL-OIG, and USPIS, with assistance from the NYSDOL Office of Special Investigations and the Schenectady County Department of Social Services, and 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.
Activity in the United States Attorney's OfficeRead the Press Release
United States District Court Judge Nancy D. Freudenthal sentenced BRETT SCHEELER, age 53, of Gillette, Wyoming, on August 4, 2022, for possession with intent to distribute 500 grams or more of methamphetamine. He received a sentence of 97 months’ imprisonment, five years of supervised release, and was ordered to pay $5,000 in community restitution and a $100 special assessment. The crime was investigated by the Drug Enforcement Administration and prosecuted by Assistant United States Attorney Jonathan C. Coppom.
United States District Court Judge Nancy D. Freudenthal sentenced DAVID LEROY YOUNG, age 64, of Casper, Wyoming, on August 4, 2022, for being a felon in possession of a firearm. He received a sentence of 46 months’ imprisonment, three years of supervised release, and was ordered to pay a $100 special assessment. The crime was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and prosecuted by Assistant United States Attorney Jonathan C. Coppom.
United States District Court Judge Alan B. Johnson sentenced GERALD LEE JOHNSTON, 57, of Springfield, Oregon, on July 26, 2022, to nine months’ imprisonment and a $100 special assessment for possession of stolen mail. The crime was investigated by the United States Postal Inspection Service and prosecuted by Assistant United States Attorney Michael J. Elmore.
Chief United States District Court Judge Scott W. Skavdahl sentenced WILLIAM DOUGAS BLATTEL, 51, of Sacramento, California, on July 27, 2022, for being a felon in possession of a firearm to 120 months’ imprisonment, three years of supervised release and a $100 special assessment. The crime was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and prosecuted by Assistant United States Attorney Timothy J. Forwood.
Chief United States District Court Judge Scott W. Skavdahl sentenced DONAE LARAE CHAVEZ, 40, of Gillette, Wyoming, on July 29, 2022, for conspiracy to commit bank fraud to 28 months’ imprisonment and five years of supervised release. Chavez was also ordered to pay $9,971.29 in restitution and a $100 special assessment. The crime was investigated by the Campbell County Sheriff’s Department and the United States Postal Inspection Service and prosecuted by Assistant United States Attorney Christyne M. Martens.
37 Members of a Violent Gang Charged with Drug Trafficking and Firearms Violations in San Juan, Puerto RicoRead the Press Release
SAN JUAN, Puerto Rico – On August 3, 2022, a federal grand jury in the District of Puerto Rico returned an indictment charging 37 violent gang members from the municipality of San Juan with conspiracy to possess with intent to distribute, possession and distribution of controlled substances, and firearms violations, announced W. Stephen Muldrow, United States Attorney for the District of Puerto Rico. The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the Rico Police Bureau (PRPB), San Juan Strike Force were in charge of the investigation of the case, with the collaboration of the Puerto Rico Department of Treasury (Hacienda), the Puerto Rico Department of Corrections and Rehabilitation, and the San Juan Municipal Police.
“These arrests represent yet another example of the excellent collaboration between our state, local, and federal partners to take violent individuals off the streets,” said W. Stephen Muldrow, U.S. Attorney for the District of Puerto Rico. “I commend the hard work of the agents and prosecutors who have worked tirelessly on this investigation to make our community safer.”
“This series of arrests represents ATF’s collaborative efforts to build, foster, and maintain relationships with our external partners in the continuing fight against those who seek to endanger the innocent with the plague of violent gun crimes,” said Christopher Robinson, Special Agent in Charge of the ATF, Miami Field Office.”
The indictment alleges that, from 2021 to the date of the return of the indictment, the drug trafficking organization distributed heroin, cocaine base (commonly known as “crack”), cocaine, marihuana, Oxycodone (Percocet), and Alprazolam (Xanax), within 1,000 feet of the Jardines de Country Club Public Housing Project and the Polvorín Ward. The object of the conspiracy was to operate a drug-trafficking organization to distribute controlled substances in the Jardines de Country Club Public Housing Project in the municipality of San Juan for significant financial profit.
Some members of the drug trafficking organization called themselves “PV” or “PV Familia.” During the investigation, members of the conspiracy moved the location of the drug points to avoid detection from law enforcement. At times, they placed locks on the access door of the building where the drug point was operating and only members of the gang had the keys to that lock, exercising control of the entrance and exit of the building.
As part of the conspiracy, the defendants operated a place where drug addicts could consume the controlled substances bought at the drug points, while out of sight from law enforcement, which they called “El Shooting”.
The defendants acted in different roles in order to further the goals of their organization, to wit: leaders/suppliers, enforcers, runners, sellers, lookouts, and facilitators. The members of the gang used force, violence, and intimidation to maintain control of the areas in which they operated. Members of the gang modified firearms to convert them into automatic weapons (machineguns). Eight (8) defendants are facing one charge of possession of firearms in furtherance of a drug trafficking crime.
The defendants are:
Milton Caliel Rodríguez-Medero, a/k/a “Cali/Árabe/Calibre/Gavilán/Calin/K/Cali P”
Johan Javier Rosales-Medero, a/k/a “Johancito/Alcalde/J/Johansity”
Edgar Betancourt-Ortiz, a/k/a “Galdi/Gar/Gardiologo/Galdy/G/Triple G/G2”
Juan Cancio Rivera-Ballester, a/k/a “Pantro/Pacro/Pantron/Pantro Juan”
Julio Ángel Ortiz-Ortiz, a/k/a “Julito”
Carlos Roberto Correa-Agosto, a/k/a “Carlos Best/Best”
Joseph Miguel Sánchez-Figueroa, a/k/a “Cocho/Cochito/Pochito/J Montana”
Jesús Alberto Montañez-Serrano, a/k/a “Vecino/Vecino Patrón”
Onix Javier De León, a/k/a “Tarzán/Chita Tarzán/Tar”
Jasser Vega-Damiani, a/k/a “Piraña/Jasser Praña/Yaz/Yaziel/Bulty/Bulto/Y”
Héctor Kenneth Ramos-Vega, a/k/a “Kene/K Trump/Kene Tiro”
Carlos Miró-Pagán, a/k/a “Farru/Farruko”
Roberto Rodríguez-Medero, a/k/a “Boina/Boinita/R/Rob/Reien/Roller/R Boina”
Ángel Manuel Rivera-Pizarro, a/k/a “Obama/Obama Malo”
Wilmer Alemán Vélez, a/k/a “Manita/Perro/Wil/Wilmer Perro”
Edwin Rafael Moux-Marquez, a/k/a “Mou/Moe/Tripy Tripy”
Ricardo Osorio-Alverio, a/k/a “Giovani/Ricky/Riky/Riky Case”
Tishanny Vélez-Castillo, a/k/a “Tisha/Ticha/Tysha”
Zwailynn Santana-Vázquez, a/k/a “Zwaili/Zua/Zwa/Sua/S”
John Michael Correa-Agosto, a/k/a “John Best/Hermano Best/John Pablo Casella”
Jean Carlos Castillo-Rivera, a/k/a “Tío/El Tío”
William Joel Delgado-Linares, a/k/a “Canito/Kanito/Cano/Will”
Israel Ortiz-Santiago, a/k/a “Chimbi”
Frank Yaniel Torres-García, a/k/a “Gran/Frnk/Ferra/Boss”
Michael Ivaniel Rivera-López, a/k/a “M/Eme/Michel/Em”
Kevin Ortiz-Valentín, a/k/a “El Colo/Colo PV”
Luis Enrique López-Rivera, a/k/a “Chino Bebote/Chino PV”
Larry Ja’Male Michael-Ferrer, a/k/a “Pina”
Alexis De Arce-López, a/k/a “Warrior/Wario/Wariol”
Javier González-Marquez, a/k/a “Javi”
Arlene Morales-Jiménez, a/k/a “La Tuerta”
José Raúl López-Cruz, a/k/a “El Menor/Menor”
Carmen Delgado-Ortiz
FNU, LNU, a/k/a “Kenia Ivette Morales-Serrano/Kenia Marie Rivera-Torres/Kenya
Rivera-Torres/Kenya Marie Rivera-Torres/La Colorá/La Colorada/La Colo/Victoria”
Pablo Rivera-Pimentel, a/k/a “Luisito”
Luis Hernández-Serpa, a/k/a “Barber/Tuto”
Luz Elenia Rivera-Rohena, a/k/a “La Abuela/Abue”
Assistant U.S. Attorney (AUSA) and Chief of the Gang Section Alberto López-Rocafort, Deputy Chief of the Gang Section, AUSA Teresa Zapata-Valladares, AUSA Joseph Russell, and Special AUSA Cristina Caraballo-Colón from the Puerto Rico Department of Justice are in charge of the prosecution of the case. If convicted on the drug charges, the defendants face a minimum sentence of 10 years, and up to life in prison. If convicted of both the drug and firearms charges, the defendants face a minimum sentence of 15 years, and up to life in prison. All defendants are facing a narcotics forfeiture allegation of $24,888,000.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
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8 August 2022
Woman Convicted in $34 Million Health Care Fraud SchemeRead the Press Release
A federal jury convicted a North Carolina woman last Thursday for her role in a scheme to defraud several private health insurers by submitting over $34 million in false and fraudulent claims for physical therapy services that were never actually provided.
According to court documents and evidence presented at trial, Jaroslava Ruiz, 50, of Chapel Hill, paid kickbacks and bribes to patient recruiters and patients with private insurance in exchange for allowing four Miami physical therapy clinics to bill for medical services that were never actually provided to those patients. Ruiz and her co-conspirators falsified medical records to give the impression that the physical therapy services were medically necessary, prescribed by a doctor, and actually rendered. In truth and fact, none or virtually none of the purported services had been provided. Ruiz and her co-conspirators submitted approximately $34.6 million in false and fraudulent claims to several private insurers for those nonexistent physical therapy services, of which the insurers paid approximately $7.7 million.
Ruiz was convicted of one count of conspiracy to commit health care fraud and wire fraud, and nine counts of health care fraud. She faces up to 20 years in prison on the conspiracy count, and up to 10 years in prison on each health care fraud count. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. Sentencing is scheduled for Oct. 26, 2022.
Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division; U.S. Attorney Juan Antonio Gonzalez for the Southern District of Florida; Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division; and Special Agent in Charge George L. Piro of the FBI’s Miami Field Office made the announcement.
The FBI is investigating the case.
Trial Attorneys Emily Gurskis and Patrick Queenan of the Criminal Division’s Fraud Section are prosecuting the case.
Warren County Man Found Guilty of Child Sexual Exploitation ChargesRead the Press Release
Erie, Pa. - After deliberating about five hours, a federal jury on Friday found Jeffrey Colin Rogers guilty of six counts of violating federal laws relating to the sexual exploitation of children, United States Attorney Cindy K. Chung announced today.
Rogers, 59, was tried before United States District Judge Stephanie L. Haines in Erie, Pennsylvania.
According to Assistant United States Attorney Christian A. Trabold, who prosecuted the case, the evidence presented at trial established that in November 2017, Rogers used his phone to take multiple sexually explicit photos of two minors after providing them marijuana and alcohol at his apartment in Sheffield, Pennsylvania. Rogers then kept the photos on his phone. Rogers also had sexual contact with the two minor victims. The Pennsylvania State Police discovered the illegal images after executing a search warrant at Rogers’ apartment in February 2018 and seizing Rogers’ phone.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Judge Haines scheduled sentencing for December 5, 2022, at 10:00 a.m. The law provides for a total sentence of 160 years in prison, a fine of $1,500,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based on the seriousness of the offenses and the prior criminal history, if any, of the defendant.
The Federal Bureau of Investigation and the Pennsylvania State Police conducted the investigation that led to the prosecution of Rogers.
Virginia Landlords to Pay $225,000 to Resolve Violations of the Servicemembers Civil Relief ActRead the Press Release
The Justice Department today announced that two Virginia landlords have agreed to pay $225,000 to resolve allegations that they violated the Servicemembers Civil Relief Act (SCRA) by obtaining unlawful court judgments against military tenants at the Hideaway at Greenbrier Luxury Apartment Homes in Chesapeake, Virginia, and the Chase Arbor Apartments in Virginia Beach, Virginia.
“Eviction judgments seriously jeopardize servicemembers’ ability to find and obtain affordable housing and negatively impact the financial readiness of our armed forces,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The department will vigorously pursue any landlord that obtains eviction judgments against servicemembers by misrepresenting their military status to the court.”
“A servicemember’s military career is adversely affected by a judgment, which affects the military’s readiness,” said U.S. Attorney Jessica D. Aber for the Eastern District of Virginia. “The U.S. Attorney’s Office is committed to pursuing companies that obtain default judgments against servicemembers by misrepresenting a servicemember’s military status or by failing to file an affidavit of military service, as required by the SCRA.”
Under the SCRA, if a landlord files a civil lawsuit against a tenant and the tenant does not appear in court, the landlord must file an affidavit with the court stating whether the tenant is in the military before seeking a judgment. If the affidavit says that the tenant is in military service, the court cannot enter judgment until it appoints an attorney to represent the servicemember. The court must also postpone the case for at least 90 days. In a complaint filed in the U.S. District Court for the Eastern District of Virginia, the department alleges that the owners of the Hideaway at Greenbrier and Chase Arbor Apartments filed false affidavits and failed to file affidavits of military service, as required by the SCRA, prior to obtaining default judgments against numerous servicemembers. The properties are affiliated with one another and used the same law firm to file eviction claims in Virginia state courts.
The department alleges that the properties’ owners knew or should have known that the affidavits that they filed were inaccurate, because their files contained information that would have allowed them to easily verify their tenants’ military status. Landlords and lenders can also verify an individual’s military status by searching the Defense Manpower Data Center’s free publicly available website and by reviewing their files to see if there are applications, military leave and earnings statements or military orders indicating military status.
Under the proposed consent order, which still must be approved by the court, the owners of the two properties will pay $162,971 to affected servicemembers and a $62,029 civil penalty to the United States. The order also requires the owners to vacate the eviction judgments, repair the servicemembers’ credit, provide SCRA training to their employees and develop new policies and procedures consistent with the SCRA. The owners must also reimburse affected servicemembers for any amounts collected pursuant to an unlawful judgment.
This matter was handled jointly by the Civil Rights Division’s Housing and Civil Enforcement Section and the U.S. Attorney’s Office for the Eastern District of Virginia. Since 2011, the department has obtained over $476 million in monetary relief for over 121,000 servicemembers through its enforcement of the SCRA. For more information about the department’s SCRA enforcement efforts, please visit www.servicemembers.gov.
Servicemembers and their dependents who believe that their rights under the SCRA have been violated should contact the nearest Armed Forces Legal Assistance Program Office. Office locations may be found at http://legalassistance.law.af.mil.
The civil claims settled are allegations only; there has been no determination by a court of liability.
Virginia Landlords to Pay $225,000 for Alleged Violations of the SCRARead the Press Release
ALEXANDRIA, Va. – The Justice Department today announced that two Virginia landlords have agreed to pay $225,000 to resolve allegations that they violated the Servicemembers Civil Relief Act (SCRA) by obtaining unlawful court judgments against military tenants at the Hideaway at Greenbrier Luxury Apartment Homes in Chesapeake and the Chase Arbor Apartments in Virginia Beach.
The department launched its investigation after a Navy legal assistance attorney reported that the owner of the Hideaway at Greenbrier had obtained an eviction default judgment against a servicemember after filing an affidavit that falsely stated that she was not in military service. Under the SCRA, if a landlord files a civil lawsuit against a tenant and the tenant does not appear in court, the landlord must file an affidavit with the court stating whether the tenant is in the military before seeking a judgment. If the affidavit says that the tenant is in military service, the court cannot enter judgment until it appoints an attorney to represent the servicemember. The court must also postpone the case for at least 90 days.
In a complaint filed in the U.S. District Court for the Eastern District of Virginia, the department alleges that the owners of the Hideaway at Greenbrier and Chase Arbor Apartments filed false affidavits and failed to file affidavits of military service, as required by the SCRA, prior to obtaining improper judgments against numerous servicemembers. The properties are affiliated with one another and used the same law firm to file eviction claims in Virginia state courts.
The department alleges that the properties’ owners knew or should have known that the affidavits that were filed were inaccurate because their files contained information that would have allowed them to easily verify their tenants’ military status. Landlords and lenders can also verify an individual’s military status by searching the Defense Manpower Data Center’s free publicly available website and by reviewing their files to identify applications, military leave and earnings statements, or military orders indicating military status.
“Eviction judgments seriously jeopardize a servicemember’s ability to find and obtain affordable housing and negatively impact the financial readiness of our armed forces,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The department will vigorously pursue any landlord that obtains eviction judgments against servicemembers by misrepresenting their military status to the court.”
“A servicemember’s military career is adversely affected by a judgment, which affects the military’s readiness,” said Jessica D. Aber, United States Attorney for the Eastern District of Virginia. “The U.S. Attorney’s Office is committed to pursuing companies that obtain default judgments against servicemembers by misrepresenting a servicemember’s military status or by failing to file an affidavit of military service, as required by the SCRA.”
Under the proposed consent order, which still must be approved by the court, the owners of the two properties will pay $162,971 to affected servicemembers and a $62,029 civil penalty to the United States. The order also requires the owners to vacate the eviction judgments, repair the servicemembers’ credit, provide SCRA training to their employees, and develop new policies and procedures consistent with the SCRA. The owners must also reimburse affected servicemembers for any amounts collected pursuant to an unlawful judgment.
This matter was handled jointly by the U.S. Attorney’s Office for the Eastern District of Virginia and the Civil Rights Division’s Housing and Civil Enforcement Section. Since 2011, the department has obtained over $476 million in monetary relief for over 121,000 servicemembers through its enforcement of the SCRA. For more information about the department’s SCRA enforcement efforts, please visit www.servicemembers.gov.
Servicemembers and their dependents who believe that their rights under the SCRA have been violated should contact the nearest Armed Forces Legal Assistance Program Office. Office locations may be found at http://legalassistance.law.af.mil.
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.
The civil claims settled are allegations only; there has been no determination by a court of liability
Used car salesman admits hiding commissions from IRSRead the Press Release
ST. LOUIS – A used car salesman in Imperial, Missouri pleaded guilty Monday to three tax charges and admitted hiding more than $300,000 in sales commissions from the IRS.
Donald Benck was primarily compensated for his sales job at a used car lot through commissions. Benck admitted that starting in 2014, he recruited acquaintances to receive the commissions by check, cash the checks and give the cash to Benck. The acquaintances kept a small fee for themselves. In total, the acquaintances cashed $326,000 in checks from 2014-2016.
Benck’s employer issued 1099 forms to the acquaintances instead of Benck, who did not inform his tax return preparer of the commissions and did not report the income on his tax returns. As a result, the 1040 forms that Benck filed with the IRS for 2014 through 2016 underreported his income. Benck failed to report $31,300 in income for tax year 2014, $131,400 for 2015 and $93,035 for 2016, causing a tax loss to the IRS of $84,092.
“Our tax system depends on everyone paying their fair share of taxes based on the filing of accurate tax returns, said Special Agent in Charge Tyler Hatcher, IRS Criminal Investigation’s St. Louis Field Office. “Dishonest tax filers leave honest tax payers to pick up the tab for their schemes.”
Benck on Monday pleaded guilty to three counts of making a false statement on an income tax return in front of U.S. District Judge Audrey G. Fleissig. He is scheduled to be sentenced Nov. 18.
The Internal Revenue Service investigated the case. Assistant U.S. Attorney Gwendolyn Carroll is prosecuting the case.
United States Obtains Warrant for Seizure of Airplane of Sanctioned Russian Oligarch Andrei Skoch, Worth over $90 MillionRead the Press Release
The United States of America has been authorized to seize an Airbus A319-100 (the Airbus) owned and controlled by sanctioned Russian oligarch Andrei Skoch, pursuant to a seizure warrant from the U.S. District Court for the Southern District of New York, which found that the airplane is subject to seizure and forfeiture based on probable cause of violation of the federal anti-money laundering laws.
According to the seizure warrant and affidavit sworn out today:
Pursuant to the International Emergency Economic Powers Act (IEEPA), the National Emergencies Act (NEA), and Executive Orders Issued by the President of the United States, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated Andrei Skoch as a Specially Designated National (SDN) on or about April 6, 2018 “for being an official of the Government of the Russian Federation,” “a deputy of the Russian Federation’s State Duma,” and because of his “longstanding ties to Russian organized criminal groups, including time spent leading one such enterprise.” After Russia invaded Ukraine in 2022, OFAC issued further sanctions against Skoch and his assets. On or about March 24, 2022, OFAC designated Skoch and other members of the Duma for “support[ing] the Kremlin’s efforts to violate Ukraine’s sovereignty and territorial integrity.” On or about June 2, 2022, OFAC identified the Airbus as blocked property in which Skoch had an interest.
Skoch is the beneficial owner of the Airbus through a series of shell companies and trusts tied to his romantic partner. After OFAC designated Skoch in or about April 2018 and continuing through in or about at least in or about 2021, U.S. dollar transactions were made to pay for the registration of the Airbus in Aruba and for aviation insurance premiums for the Airbus, each of which was a necessary expense to maintain and operate the Airbus.
The Airbus (pictured below), bearing tail number P4-MGU and serial number 5445, is believed to be worth more than $90 million.
U.S. Attorney Williams praised the outstanding work of the FBI and U.S. Department of Commerce, Bureau of Industry and Security. The Justice Department’s National Security Division and Office of International Affairs and the U.S. Treasury Department’s Office of Foreign Assets Control provided valuable assistance in this investigation.
Assistant U.S. Attorneys Joshua A. Naftalis and Nicholas S. Bradley for the Southern District of New York are in charge of the investigation.
The investigation was coordinated through the Justice Department’s Task Force KleptoCapture, an interagency law enforcement task force dedicated to enforcing the sweeping sanctions, export controls, and economic countermeasures that the United States, along with its foreign allies and partners, has imposed in response to Russia’s unprovoked military invasion of Ukraine. Announced by the Attorney General on March 2 and run out of the Office of the Deputy Attorney General, the task force will continue to leverage all of the Department’s tools and authorities to combat efforts to evade or undermine the collective actions taken by the U.S. government in response to Russian military aggression.
United States Obtains Warrant for Seizure of Airplane of Sanctioned Russian Oligarch Andrei Skoch Worth over $90 MillionRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, Lisa O. Monaco, the Deputy Attorney General of the United States, Michael J. Driscoll, the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and Matthew S. Axelrod, Assistant Secretary of Commerce for Export Enforcement, announced today that the United States of America has been authorized to seize an Airbus A319-100 (the “Airbus”) owned and controlled by sanctioned Russian oligarch Andrei Skoch, pursuant to a seizure warrant from the U.S. District Court for the Southern District of New York, which found that the airplane is subject to seizure and forfeiture based on probable cause of violation of the federal anti-money laundering laws.
U.S. Attorney Damian Williams said: “Today’s affidavit and warrant authorizing the seizure of Andrei Skoch’s private airplane demonstrate the Southern District’s partnership commitment with the task force to pursuing sanctioned Russian oligarchs and their blocked property. We will continue to use every legal tool available to enforce our anti-money laundering laws and to pursue those who seek to use the U.S. financial system to violate and evade sanctions.”
Task Force KleptoCapture Director Andrew C. Adams said: “Once again U.S. law enforcement has demonstrated that international shell games will not suffice to hide the fruits of corruption and money laundering. Through today’s warrant, the Department of Justice lays out a roadmap for those engaged in the legitimate financial sector to follow when assessing transactions with Skoch’s laundering network, while taking steps to freeze, seize, and forfeit the fruits of his criminal activities.”
FBI Assistant Director-in-Charge Michael J. Driscoll said: “An oligarchy is defined as a government in which a small group exercises control for their own selfish and corrupt gain. Members of that group in Russia have long hid and disguised their illegal activities using the U.S. dollar in the process. The sanctions levied by the U.S government and the work of this task force demonstrate to these offensively wealthy oligarchs who support Russia’s military aggression that they are not untouchable, and we are dramatically impacting their way of life.”
Assistant Secretary of Commerce for Export Enforcement Matthew S. Axelrod said: “Today’s action demonstrates that the U.S. government will be relentless in our efforts to bring to justice those that are enabling Putin’s heinous war against Ukraine. Coordination and collaboration between federal law enforcement and international partners is essential to effective enforcement of U.S. law, and I’m proud of our team of dedicated law enforcement professionals.”
According to the seizure warrant and affidavit sworn out today:[1]
Pursuant to the International Emergency Economic Powers Act (“IEEPA”), the National Emergencies Act, and Executive Orders Issued by the President of the United States, the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) designated Andrei Skoch as a Specially Designated National (“SDN”) on April 6, 2018 “for being an official of the Government of the Russian Federation,” “a deputy of the Russian Federation’s State Duma,” and because of his “longstanding ties to Russian organized criminal groups, including time spent leading one such enterprise.” After Russia invaded Ukraine in 2022, OFAC issued further sanctions against Skoch and his assets. On March 24, 2022, OFAC designated Skoch and other members of the Duma, for “support[ing] the Kremlin’s efforts to violate Ukraine’s sovereignty and territorial integrity.” On June 2, 2022, OFAC identified the Airbus as blocked property in which Skoch had an interest.
Skoch is the beneficial owner of the Airbus through a series of shell companies and trusts tied to his romantic partner. After OFAC designated Skoch in April 2018 and continuing through at least 2021, U.S. dollar transactions were made to pay for the registration of the Airbus in Aruba and for aviation insurance premiums for the Airbus, each of which was a necessary expense to maintain and operate the Airbus.
The Airbus (pictured below), bearing tail number P4-MGU and serial number 5445, is believed to be worth more than $90 million.
* * *
Mr. Williams praised the outstanding work of the FBI and U.S. Department of Commerce, Bureau of Industry and Security. Mr. Williams further thanked the Justice Department’s National Security Division and Office of International Affairs, and OFAC for their assistance in this investigation.
This case is being handled by the Office’s Money Laundering and Transnational Criminal Enterprises Unit and National Security and International Narcotics Unit. Assistant United States Attorneys Joshua A. Naftalis and Nicholas S. Bradley are in charge of the investigation.
The investigation was coordinated through the Justice Department’s Task Force KleptoCapture, an interagency law enforcement task force dedicated to enforcing the sweeping sanctions, export controls, and economic countermeasures that the United States, along with its foreign allies and partners, has imposed in response to Russia’s unprovoked military invasion of Ukraine. Announced by the Attorney General on March 2 and run out of the Office of the Deputy Attorney General, the task force will continue to leverage all of the Department’s tools and authorities to combat efforts to evade or undermine the collective actions taken by the U.S. government in response to Russian military aggression.
[1] The burden to prove forfeitability in a forfeiture proceeding is upon the government.
U.S. Attorney’s Office Reaches Settlement with City of Denver and Concert Promoters Relating to Overcharging for Wheelchair-Accessible Seating at Red Rocks AmphitheatreRead the Press Release
DENVER – The U.S. Attorney’s Office for the District of Colorado announced today that the United States has resolved a discrimination claim under the Americans with Disabilities Act (ADA) against the City and County of Denver and concert promoters Live Nation, AEG, and PBS12.
The Department of Justice received a complaint that wheelchair-accessible seats for concerts held at Red Rocks Amphitheatre were more expensive than tickets for non-accessible seats. The U.S. Attorney’s Office investigated the complaint and alleged that the City and County of Denver, which owns Red Rocks, and concert promoters, which contracted with Denver to host events, violated the ADA by charging more for wheelchair-accessible seats than was allowed under ADA regulations.
There are 121 wheelchair-accessible seats available for each Red Rocks event. The United States alleged that, between 2018 and 2020, concertgoers who used wheelchairs, and their guests, were charged $47,950.90 more for those seats than was permitted by ADA regulations. The United States alleged that in total, Denver and concert promoters overcharged for 1,817 tickets at 178 events held at Red Rocks.
To resolve the complaint, Denver agreed to set aside $47,950.90 that will be refunded to individuals who were overcharged for wheelchair-accessible tickets. Denver has implemented a system to ensure that wheelchair-accessible tickets are priced in accordance with ADA regulations. In addition, concert promoters Live Nation, AEG, and PBS12 each paid a civil penalty to the United States.
“Red Rocks is an iconic concert venue, and people with disabilities who attend events and watch their favorite bands there should not be unfairly overcharged for wheelchair-accessible seating,” Matt Kirsch, Attorney for the United States, Acting under Authority Conferred by 28 U.S.C. § 515. “This agreement reflects our commitment to enforcing the Americans with Disabilities Act, which requires equal treatment for people with disabilities.”
This case was handled by Assistant U.S. Attorney Zeyen Wu.
The agreement is not an admission of any violation or liability by the City and County of Denver.
https://twitter.com/USAO_CO/status/1556679470832123905
U.S. Attorney’s Office Collects More Than $620k in Restitution from Defendant in Penny Stock Fraud SchemeRead the Press Release
First Assistant U.S. Attorney Michelle M. Baeppler announced that the Financial Litigation Program (FLP) of the U.S. Attorney’s Office for the Northern District of Ohio collected full restitution in the amount of $624,122.15 from a defendant convicted of participating in a securities fraud scheme that caused a $39 million loss to investors.
According to court records, a notice of judgment satisfaction was approved for Defendant Justin Esposito, of Thornwood, New York, on Saturday, August 6, 2022. In 2016, Esposito and other codefendants were convicted of orchestrating a penny-stock fraud scheme that resulted in a $39 million loss to investors in the Northern District of Ohio and elsewhere.
As part of his role in the scheme, Esposito cold-called potential investors and sold stock in public companies that he knew were being manipulated. Esposito was paid commission from coconspirators for these sales.
In January 2017, Esposito was ordered to pay $624,122.15 in restitution to the defendants for his role in the scheme.
This case was investigated by the FBI. The financial litigation was handled by Assistant U.S. Attorney Suzana K. Koch. This case was criminally prosecuted by Assistant U.S. Attorney Brian M. McDonough.
The U.S. Attorney’s Office is responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss.
While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims Fund, which distributes the funds collected to federal and state victim compensation and victim assistance programs.
Forfeited assets deposited into the Department of Justice Assets Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.
U.S. Attorney Announces Return of 30 Looted Antiquities to Kingdom of CambodiaRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, and Ricky J. Patel, Acting Special Agent in Charge of Homeland Security Investigations (“HSI”) in New York, announced today the return to the Kingdom of Cambodia of 30 antiquities which were stolen from Cambodia as part of an organized looting network and sold by antiquities dealer Douglas Latchford. Among the antiquities returned today was a 10th Century sculpture of Skanda on a Peacock and a monumental 10th Century sculpture of Ganesha, both looted from the ancient Khmer capital Koh Ker. Cambodian Ambassador to the United States Keo Chhea received the antiquities today during a ceremony at the U.S. Attorney’s Office.
U.S. Attorney Damian Williams said: “Today, we celebrate the return of Cambodia’s cultural heritage to the Cambodian people, and reaffirm our commitment to reducing the illicit trafficking of art and antiquities. It is with great pleasure that we send the Skanda on a Peacock and the rest of these artworks on the final leg of their journey home.”
HSI Acting Special-Agent-in-Charge Ricky J. Patel said: “These antiquities we return today were ripped from their country. Beyond their extraordinary beauty and craftsmanship, many are sacred artifacts pried from temples and palaces to be smuggled across borders and peddled by those seeking profit, without any regard to the intangible value they have to the people of their homeland. For over five years, the agents and experts in HSI New York’s specialized dedicated Cultural Property, Arts and Antiquities Unit, alongside our government partners, hunted down leads, examined origin, reviewed financial records, and conducted dozens of interviews to find and recover these pieces we are returning today. These artifacts belong to the people of Cambodia, and we are proud to participate in their recovery and their return home.”
The 30 antiquities returned to Cambodia today were the subjects of three civil forfeiture actions filed in this District. According to the civil forfeiture complaints filed in 2021 and 2022, and other documents filed in the cases:
The antiquities repatriated to Cambodia are sandstone and bronze sculptures and artifacts, ranging in age from the Bronze Age to the 12th Century, which were either removed illegally from Cambodia by looters, imported into the United States based on false statements to United States Customs and Border Protection (“CBP”), or both.
During the civil conflicts of late 20th century, statues and other artifacts were stolen from Koh Ker and other archeological sites in Cambodia and entered the international art market through an organized looting network. Local teams of looters would first remove the statues from the original sites. The statues would then be transported to the Cambodia-Thailand border, and transferred to brokers, who would in turn transport them to dealers in Khmer artifacts located in Thailand, particularly Bangkok. These dealers would sell the artifacts to local or international customers, who would either retain the pieces or sell them on the international art market.
Bangkok-based antiquities dealer Douglas Latchford, a/k/a “Pakpong Kriangsak” sold the antiquities to individuals in the Western art market, including the two private collectors and an American museum which were the prior owners of the pieces returned today. In 2019, Latchford was charged by this Office with wire fraud conspiracy and other crimes related to a many-year scheme to sell looted Cambodian antiquities on the international art market, primarily by creating false provenance documents and falsifying invoices and shipping documents. The indictment was ultimately dismissed due to the death of Latchford.
Once the prior owners were contacted by the United States, they agreed to relinquish possession of the antiquities and to waive all claims of right, title, and interest in them.
* * *
Mr. Williams thanked Homeland Security Investigations for its outstanding work on this investigation, and U.S. Customs and Border Protection for its invaluable assistance. Mr. Williams also thanked the Kingdom of Cambodia’s Ministry of Culture and Fine Arts for its assistance with this investigation.
This matter is being handled by the Office’s Money Laundering and International Criminal Enterprises Unit. Assistant U. S. Attorney Jessica Feinstein is in charge of the case.
Tyler County woman admits to mail fraudRead the Press Release
WHEELING, WEST VIRGINIA – Margaret Ann Moffitt, of Sistersville, West Virginia, has admitted to mail fraud, United States Attorney William Ihlenfeld announced.
Moffitt, 63, pleaded guilty today to one count of “Mail Fraud.” Moffitt stole money from the estate of someone in the amount of $156,744.87. As the executor of the estate, she made cash withdrawals and endorsed checks to be mailed to people not associated with the estate in any way. She then caused checks to be mailed to the beneficiaries of the state, knowing the funds were no longer in the account. She stopped payments on those checks because she knew the funds were gone. The crimes occurred from August 2019 to December 2020 in Tyler and Wetzel Counties.
Moffitt faces up to 20 years of incarceration and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Danae DeMasi-Lemon is prosecuting the case on behalf of the government. The Wet Virginia State Police and the Office of the Prosecuting Attorney for Tyler County investigated.
U.S. Magistrate Judge James P. Mazzone presided.
Two Jefferson County Men Sentenced to at Least 15 Years in Prison for Production of Child PornographyRead the Press Release
KNOXVILLE, Tenn. – On August 4, 2022, the Honorable Katherine A. Crytzer, United States District Judge for the Eastern District of Tennessee, sentenced Alan Malott, age 27, of Dandridge, Tennessee, to serve 195 months in federal prison, and on August 5, 2022, the Honorable Katherine A. Crytzer sentenced Christopher Thurman, age 25, also of Dandridge, Tennessee, to serve 180 months in federal prison. Malott and Thurman were co-defendants who were both charged with the production of child pornography.
As part of plea agreements filed with the court, Malott and Thurman both agreed to plead guilty to an indictment charging them with producing child pornography in violation of 18 U.S.C. § 2251(a) and (e). Following their term of imprisonment, Malott and Thurman will be on supervised release for life. Both Malott and Thurman will be required to register with state sex offender registries and comply with special sex offender conditions during their supervised release.
According to documents filed in the case, Malott and Thurman admitted in 2019 they filmed themselves raping a minor family member of Malott’s. Malott then sent the video of the rape to his prior boyfriend in Louisiana and to Thurman. The defendants also admitted they sexually abused a horse and dog.
This prosecution was the result of an investigation by the Federal Bureau of Investigation.
Assistant U.S. Attorney Jennifer Kolman represented the United States in court.
This case was brought as part of Project Safe Childhood (PSC), a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section, PSC 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 PSC, please visit www.projectsafechildhood.gov.
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Two Florida Men Charged with Conspiring to Launder Money Obtained from Internet-Enabled ScamsRead the Press Release
NEWARK, N.J. – Two Florida men were charged with conspiring to launder money taken from victims across the United States, many of whom were elderly, as a part of a series of romance scams and other internet fraud, U.S. Attorney Philip R. Sellinger announced today.
Marlin Perra, 63, of Lake Panasoffkee, Florida, and Leslie Lallande, 65, of Pompano Beach, Florida, were both arrested in Florida and are charged by complaint with one count of money laundering conspiracy. Both defendants are expected to have their initial appearances in the District of New Jersey at a date to be determined.
According to documents filed in this case and statements made in court:
Perra and Lallande laundered the proceeds of romance scams and other fraud scams through trade-based money laundering. Perra and Lallande tried to conceal the fraudulent proceeds stolen from romance scam victims by claiming that entities they controlled were in the business of buying and shipping used cars. Lallande and his conspirators prepared and executed fraudulent agreements that purported to be signed by victims agreeing to invest in Lallande’s alleged automobile business. In fact, these agreements were phony cover stories designed to paper over their receipt and movement of the romance scam proceeds.
The money laundering conspiracy charge has a maximum penalty of 20 years in prison and a fine of $500,000, or twice the value of the funds involved in the transfer, whichever is greater.
U.S. Attorney Sellinger credited special agents of the FBI, under the direction of Special Agent in Charge James E. Dennehy in Newark, Special Agent in Charge Gregory D. Nelsen in Cleveland, Ohio, and Special Agent in Charge Joseph E. Carrico in Knoxville, Tennessee, with the investigation leading to the arrests. He also thanked special agents of the FBI in Miami, Florida, for their assistance.
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 defendants are presumed innocent unless and until proven guilty.
Two East Stroudsburg Women Sentenced for Evading Tobacco Excise TaxesRead the Press Release
HARRISBURG—The United States Attorney’s Office for the Middle District of Pennsylvania announced that Hope Carbone, age 72, and Donna Venturini, age 70, both of East Stroudsburg, Pennsylvania, were sentenced on August 5, 2022, by U.S. District Court Judge Jennifer P. Wilson to two years of probation for conspiring to evade federal excise taxes on imported large cigars.
According to United States Attorney Gerard M. Karam, Carbone and Venturini previously admitted to conspiring with Jose Dominguez, the owner of cigar manufacturer Victor Sinclair Cigars, to evade the excise taxes imposed on the importation of Victor Sinclair manufactured cigars from 2009 to 2011. Carbone and Venturini served as the U.S. importer for Victor Sinclair Cigars, which is located in the Dominican Republic. Through fraudulent invoices, Dominguez, Carbone, and Venturini collected approximately $3.9 million in excise taxes from U.S. purchasers of Victor Sinclair manufactured cigars. Of that amount, the co-conspirators paid only approximately $2.1 million to the government, retaining approximately $1.8 million for themselves. As part of their sentence, Carbone and Venturini were ordered to pay restitution.
Jose Dominguez pleaded guilty to conspiracy to evade federal excise taxes in June 2022. He is awaiting sentencing.
The case was investigated by the INternal Revenue Service - Criminal Investigation and the Department of Treasury, Alcohol and Tobacco Tax and Trade Bureau. Assistant U.S. Attorneys Carlo D. Marchioli and Joseph J. Terz prosecuted the case.
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Travel Agent Sentenced to Prison for Fraud on Clients, Cruise Lines and Payment ProcessorsRead the Press Release
Tampa, Florida – U.S. District Judge Susan C. Bucklew today sentenced Diana M. Hopkins (48, Wimauma) to 37 months in federal prison for wire fraud, access device fraud, and money laundering. As part of her sentence, the Court also entered an order of forfeiture in the amount of $115,995.67, the proceeds of the charged criminal conduct, and ordered her to pay restitution in the amount of $432,938.64. Hopkins had pleaded guilty on April 12, 2022.
According to court documents, Hopkins owned and operated Hopkins Travel Services LLC (“HTS”) in Wimauma, Florida. From about April of 2017 through September 2019, Hopkins used HTS to commit wire fraud and access device fraud and to engage in illegal monetary transactions. Specifically, Hopkins made false and fraudulent misrepresentations in soliciting clients via Facebook, a website (www.htsvacationdeals.com) and other means, to purchase cruise packages through HTS at discounted prices and/or “buy one get one” deals, which fares were well below what the cruise lines actually offered and the amounts that HTS had to pay or would ultimately pay for clients’ cruises. Hopkins made additional misrepresentations in offering clients further discounts and/or additional travel amenities to induce them to make payments for cruise package reservations and related travel arrangements in full and well in advance of the clients’ cruise sail dates.
Hopkins caused some clients to provide credit card information ostensibly for the purpose of paying for their cruise package reservations and related travel arrangements, and then used the credit card information to make Ponzi-style payments on other clients’ reservations via the cruise lines’ reservation portals, without any of the clients’ knowledge or consent. In fact, when Hopkins input credit card information into the cruise lines’ reservation portals, she altered the names associated with certain credit card information so that said names matched the names on the cruise package reservations to which she applied the payments.
Hopkins caused other clients to make payments via Stripe, Square, PayPal and other ePayment services, and she caused the payments to be transferred into bank accounts she controlled. Then Hopkins used proceeds of some clients’ ePayments to make Ponzi-style payments on other clients’ reservations via the cruise lines’ reservation portals, without any of the clients’ knowledge or consent.
Moreover, Hopkins used a portion of her clients’ payments made for cruise package reservations and related travel arrangements to pay for personal and family expenses for, among other things, groceries, restaurants, retail shopping, and other household items and services, and otherwise for her own personal enrichment. Such expenditures included, but were not limited to, cruises for family members, jewelry, and a 2019 Dodge Ram 1500.
In total, Hopkins’ offenses resulted in financial losses to the victims in the amount of approximately $461,823.38. She personally received at least $91,495.67 in fraudulent proceeds, and she used an additional $24,500 in fraudulent proceeds towards the purchase of the 2019 Dodge Ram.
This case was investigated by the Federal Bureau of Investigation. It was prosecuted by Assistant United States Attorney Rachelle DesVaux Bedke.
Trafficking meth in an Igloo cooler results in prison timeRead the Press Release
McALLEN, Texas – A 25-year-old Mexican citizen illegally residing in Monte Alto has been ordered to federal prison after admitting to possessing with intent to distribute 140 kilograms of meth, announced U.S. Attorney Jennifer B. Lowery.
Jose Maria Hernandez-Alvarez pleaded guilty Dec. 3, 2021.
Today, U.S. District Judge Randy Crane ordered Hernandez to serve a 70-month sentence. Not a U.S. citizen, he is expected to face removal proceedings following his/h imprisonment.
On Sept. 8, 2021, law enforcement was conducting surveillance which led to a traffic stop. At that time, Hernandez gave consent for a search of his car.
Authorities soon discovered approximately 15.5 kilograms of meth in an Igloo ice chest in the trunk of his vehicle. Hernandez claimed ownership of the narcotics and admitted he had more drugs stored at his residence. A search at that location resulted in the discovery of an additional 123.5 kilograms of meth.
Hernandez stated he had been living in the United States for three months and, during that time, had received three shipments of meth from Mexico.
The estimated street value of the meth is $490,000.
Hernandez has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The Drug Enforcement Administration conducted the investigation with the assistance of the Hidalgo County High Intensity Drug Trafficking Area Task Force. Assistant U.S. Attorney M. Alexis Garcia prosecuted the case.
Tokio, ND, Woman Sentenced to Life in Prison for Murder of Foster Child and Abuse and Neglect of Other ChildrenRead the Press Release
Fargo –United States Attorney Jennifer Klemetsrud Puhl announced that Tammy Longie of Tokio, ND, appeared before Chief Judge Peter D. Welte, U.S. District Court, Fargo, ND, and was sentenced to serve life in prison after having plead guilty to Second-Degree Murder within Indian Country; three counts of Child Abuse in Indian Country; and Child Neglect in Indian Country.
On May 6, 2020, agents with the Bureau of Indian Affairs and the Federal Bureau of Investigation responded to the home of Erich and Tammy Longie on the Spirit Lake Reservation. Law enforcement observed a deceased 5-year-old child in the basement of the home and observed bruising throughout the body. An autopsy concluded the death a homicide and identified the cause of death as bilateral subdural hematomas incurred from assault. The pathologist observed abrasions and contusions consistent with "multiple episodes of inflicted trauma." The child’s sibling was examined at a local hospital and determined to need a higher level of care and was hospitalized for more than a month. An attending physician explained the child had bruising over the child’s body consistent with abuse. The primary medical concern, however, was heart failure due to malnutrition.
Spirit Lake Tribal Social Services ("SLTSS") had placed the two children in foster care in the home of Erich Longie, Jr., and Tammy Longie in July of 2019.
The investigation revealed that two biological children were also abused including with objects and hands.
"This is a tragic and horrifying case," said United States Attorney Jennifer Klemetsrud Puhl. "The children endured prolonged physical and emotional abuse by Longie, who was responsible for caring and protecting them. In particular, Longie’s physical and psychological abuse of five-year-old R.T. and seven-year-old Z.T. represents some of the worst of humanity; for Longie ultimately killed R.T. and severely injured Z.T. Today’s sentence ensures that she will be removed from her community forever."
Co-defendant Erich Longie, Jr. plead guilty to First-Degree Murder; three counts of Child Abuse in Indian Country, and Child Neglect in Indian Country and was also sentenced to serve life in prison.
This case was investigated by the Federal Bureau of Investigation and the Bureau of Indian Affairs and is being prosecuted by the United States Attorney’s office, with Assistant United States Attorney Lori H. Conroy assigned to the case.
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