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Tuesday 12 April 2022
Three Florida Men Indicted for Rigging Bids and Defrauding the U.S. MilitaryRead the Press Release
Note: The defendants in this case, Lawrence O'Brien, Bruce LaRoche and Thomas Dailey, were acquitted by a jury of the charges alleged in the indictment described in the press release below.
A federal grand jury in the Middle District of Florida returned an indictment, which was unsealed today, charging three Florida men with conspiring to rig bids for customized promotional products to the U.S. Army and charging two of them with conspiring to defraud the United States. Two of the men were arrested early this morning, and all three appeared in court for initial appearances this afternoon.
According to court documents, Lawrence O’Brien, Bruce LaRoche and Thomas Dailey conspired to eliminate competition among their companies and secure sales for a pre-arranged winner. To carry out this scheme, they exchanged their company’s bid templates and submitted bids to military customers on each other’s behalf.
“Bid-rigging and fraud schemes targeting the military will not be tolerated – they are an affront to competition and the American taxpayer,” said Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division. “Consistent with a whole-of-government approach, the Antitrust Division will continue working closely with our law enforcement partners and Procurement Collusion Strike Force to protect taxpayer funds from collusion and fraud.”
“This indictment is another example of our commitment to protecting the contracting process from those who attempt to rig the system in their favor,” said Special Agent-in-Charge Michael Curran of the U.S. Army Criminal Investigation Division’s (CID) Major Procurement Fraud Field Office. “CID and our law enforcement partners will continue to protect the integrity of the contracting process.”
“Bid rigging is not a victimless crime; it cheats taxpayers out of the benefits of competition,” said Special Agent Paul Wachsmuth, Director of the Office of Procurement Fraud Investigations, U.S. Air Force Office of Special Investigations (OSI), Joint Base Anacostia-Bolling, D.C. “OSI is committed to working with the Antitrust Division and our law enforcement partners to hold companies and individuals accountable for practices that erode public trust and confidence in the government’s acquisition process.”
The indictment also alleges that LaRoche participated in a conspiracy to defraud the United States. According to the charge, LaRoche created shell companies, then he or his co-conspirators would submit sham bids from those companies. The bids appeared to be competitive because, for example, each listed a different salesperson, price or product description, despite the fact that all of the bids were drafted by the co-conspirators and the companies were owned or controlled by LaRoche. Additionally, the indictment alleges that O’Brien participated in a conspiracy with his own set of shell companies.
All three men are charged with violating the Sherman Antitrust Act. The maximum penalty for that charge is 10 years in prison and a $1 million criminal fine. LaRoche and O’Brien each face separate charges of conspiracy to defraud the United States. The maximum penalty for that charge is five years in prison and a $250,000 criminal fine.
The Antitrust Division’s Washington Criminal I Office is prosecuting the case, which was investigated with the assistance of the U.S. Army CID and U.S. Air Force OSI.
In November 2019, the Department of Justice created the Procurement Collusion Strike Force (PCSF), a joint law enforcement effort to combat antitrust crimes and related fraudulent schemes that impact government procurement, grant and program funding at all levels of government – federal, state and local. In fall 2020, the Strike Force expanded its footprint with the launch of PCSF: Global, designed to deter, detect, investigate and prosecute collusive schemes that target government spending outside of the United States. To learn more about the PCSF, or to report information on market allocation, price fixing, bid rigging and other anticompetitive conduct related to defense-related spending, go to https://www.justice.gov/procurement-collusion-strike-force.
An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Three Defendants Sentenced on Drug and Firearms ChargesRead the Press Release
LAFAYETTE, La. - United States Attorney Brandon B. Brown announced that three defendants have been sentenced in U.S. District Court in Lafayette, Louisiana, on drug and firearms charges.
Chief United States District Judge S. Maurice Hicks, Jr. sentenced two of the defendants as follows:
Desmond Francois, 32, of Houston, Texas, was sentenced to 120 months in prison, followed by 5 years of supervised release, for possession with intent to distribute cocaine. On May 11, 2017, officers with the Lafayette Police Department initiated a bus interdiction at the Greyhound Bus Station located in downtown Lafayette, Louisiana. Law enforcement officers boarded the bus and identified themselves and told the passengers the purpose of their stop. While searching the bus, officers observed that on row 6, there were two black backpacks on the floor, a silver purse, and a gray hoodie and phone on the seat. Directly above that seat was a red and black plaid bag. When all passengers re-boarded the bus and returned to their seats, row 6 remained empty. Officers asked all passengers if the items belong to anyone present and none claimed them. However, one of the passengers told the officer that he saw the male and female from row 6 run when they saw law enforcement boarding the bus. The male was later identified as Francois. Inside the backpack from row 6 was approximately ten kilograms of cocaine and a Greyhound bus ticket for passenger Desmond Francois. Further investigation confirmed that Francois was associated with a drug trafficking organization in the Houston area that has a history of drug trafficking in Louisiana.
This case was investigated by the U.S. Drug Enforcement Administration and Lafayette Police Department and was prosecuted by Assistant U.S. Attorney Jamilla A. Bynog.
Lionel Hill, Jr., 41, of Port Arthur, Texas, was sentenced to 60 months in prison, followed by 4 years of supervised release, on drug trafficking charges. Officers with the New Iberia Police Department stopped a vehicle being driven by Hill on May 6, 2021 for a traffic violation. Hill consented to a search of his person and officers located 50.6 grams of a substance containing fentanyl and 28.7 grams of a substance containing methamphetamine. Hill admitted to officers that he possessed the narcotics with the intent to distribute them. Lab reports later confirmed that the substance contained a detectable amount of fentanyl. On October 21, 2021, Hill pleaded guilty to possession with intent to distribute over 40 grams or more of a mixture or substance containing a detectable amount of N-phenyl-N-[1-(2-phenylethyl)-4-piperidinyl] propanamide, a Schedule II narcotic controlled substance.
The case was investigated by the U.S. Drug Enforcement Administration and the New Iberia Police Department and was prosecuted by Assistant U.S. Attorney Daniel J. Vermaelen.
United States District Judge David C. Joseph sentenced Jacob Wilson Zirlott, 39, of Franklin, Louisiana, to 70 months in prison, followed by 3 years of supervised release, for being a convicted felon in possession of a firearm. On June 19, 2017, officers with the St. Mary Parish Sheriff’s Office executed a search warrant on Zirlott’s residence. During their search, deputies located an AR-15 firearm in the living room, along with several magazines located next to the firearm and drug paraphernalia. Zirlott admitted that the gun belonged to him even though he was a convicted felon and knew he was prohibited from possessing any firearm. Zirlott has prior felony convictions for robbery in Florida (1999) and aggravated second degree battery in Louisiana (2010).
The case was investigated by the Homeland Security Investigations-U.S. Immigration and Customs Enforcement and the St. Mary Parish Sheriff’s Office and was prosecuted by Assistant U.S. Attorney John W. Nickel.
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Temple Terrace Woman Sentenced to Two Years in Prison for Bank Fraud Involving COVID-19 Paycheck Protection ProgramRead the Press Release
Tampa, Florida – U.S. District Judge Charlene Edwards Honeywell has sentenced Bridgitte Keim (52, Temple Terrace) to 24 months in federal prison for bank fraud. The Court also ordered Keim to forfeit $7,500, which was traceable to proceeds of the offense. Keim had pleaded guilty on January 5, 2022.
According to court documents, between April and May 2021, Keim defrauded a federally insured financial institution and the U.S. Small Business Administration (“SBA”) by submitting false and fraudulent loan applications and supporting documentation for federally guaranteed Payment Protection Program (“PPP”) loans that were designed to assist businesses suffering adverse economic effects from the COVID-19 pandemic. Keim recruited family members to provide their personal information in exchange for free “COVID money.” Keim prepared and submitted false and fraudulent PPP loan applications to the financial institution on behalf of her relatives in the names of fictitious businesses, knowing that her relatives did not have existing businesses, did not have employees, had no business income, and had no payroll expenses as required by the SBA to qualify for PPP loans. In furtherance of the scheme, Keim also impersonated the family members in communications with the financial institution.
This case was investigated by the Federal Housing Finance Agency – Office of Inspector General, the U.S. Small Business Administration – Office of Inspector General, and the Federal Bureau of Investigation. It was prosecuted by Special Assistant United States Attorney Chris Poor.
Tempe Man Sentenced to 48 Months for Importation of Fentanyl into the U.S.Read the Press Release
TUCSON, Ariz. – Charles King Jr., 49, of Tempe, Arizona, was sentenced yesterday by U.S. District Judge Scott H. Rash to 48 months in prison, followed by five years of supervised release. King Jr. previously pleaded guilty to importing fentanyl into the United States from Mexico.
On February 20, 2020, King Jr. entered the United States from Mexico through the DeConcini Nogales, Arizona port of entry. A Customs and Border Protection canine alerted to the vehicle that King Jr. was riding in, and officers discovered nearly 11 pounds of fentanyl carefully hidden in the drive shaft of the vehicle.
Customs and Border Protection completed the interdiction and Homeland Security Investigations - Nogales conducted the investigation. The United States Attorney’s Office, District of Arizona, Tucson, handled the prosecution.
CASE NUMBER: CR-20-1559-TUC-SHR (BGM)
RELEASE NUMBER: 2022-041_King Jr.# # #
For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.Syracuse Man Pleads Guilty to Possessing and Intending to Distribute 6 Kilograms of CocaineRead the Press Release
SYRACUSE, NEW YORK – Alexander Carrasquillo-Rosado, age 31, of Syracuse, pled guilty today to possessing and intending to distribute controlled substances. The announcement was made by United States Attorney Carla B. Freedman, Ketty Larco-Ward, Inspector in Charge, United States Postal Inspection Service (USPIS), Boston Division, Matthew Scarpino, Acting Special Agent in Charge, Homeland Security Investigations (HSI), Buffalo Field Office, Thomas Fattorusso, Executive Special Agent in Charge, Internal Revenue Service – Criminal Investigation Division (IRS-CI), New York Field Office, and Kenton Buckner, Chief of Police, Syracuse Police Department.
As part of his plea, Carrasquillo-Rosado admitted that, on November 17, 2021, he possessed with intent to distribute six kilograms of cocaine found in his car and his house on that day.
At sentencing on August 17, 2022, Carrasquillo-Rosado faces a term of imprisonment of at least ten years and up to life, a post-incarceration term of supervised release of between five years and life, and a maximum fine of $10,000,0000. A defendant’s sentence is imposed by a judge based on the statute the defendant is charged with violating, the U.S. Sentencing Guidelines, and other factors.
This case is being investigated by the United States Postal Inspection Service (USPIS), Homeland Security Investigations (HSI), Internal Revenue Service – Criminal Investigation Division (IRS-CI), and the Syracuse Police Department. Investigative assistance was provided by the Drug Enforcement Administration (DEA), United States Border Patrol, and the Onondaga County Sheriff’s Office. The case is being prosecuted by Assistant U.S. Attorney Michael D. Gadarian.
Stoneham Man Sentenced for Identity Theft and Fraud Related to COVID-19 Pandemic Unemployment AssistanceRead the Press Release
BOSTON – A Stoneham man was sentenced today for his involvement in a fraudulent scheme to obtain COVID-19-related unemployment assistance using stolen personal information.
Daniel Maleus, 34, was sentenced by U.S. Senior District Court Judge Rya W. Zobel to three years in prison and three years of supervised release. Maleus was also ordered to pay restitution in the amount of $526,423. On Nov. 2, 2021, Maleus pleaded guilty to one count of conspiracy to commit wire fraud, five counts of wire fraud, and one count of aggravated identity theft.
In March 2020, in response to the global coronavirus pandemic, Congress passed the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), which among other things, created a temporary federal unemployment insurance program called Pandemic Unemployment Assistance (PUA). The PUA program, which in Massachusetts is administered by the Department of Unemployment Assistance, provided unemployment insurance benefits for individuals who were not eligible for other types of unemployment benefits.
Between April 2020 and April 2021, Maleus filed and conspired with others to file over 50 fraudulent PUA claims using the stolen personal information of others. Maleus used email accounts that he created in the names of the victims and directed payments from the fraudulent claims to bank accounts that he controlled. Maleus and his co-conspirators obtained $526,423 in PUA funds from this scheme.
United States Attorney Rachael S. Rollins; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division; and Jonathan Mellone, Special Agent in Charge of the Department of Labor, Office of Inspector General, Office of Investigations made the announcement. Special assistance was provided by the Massachusetts Department of Unemployment Assistance. Assistant U.S. Attorney Christopher J. Markham of Rollins’ Securities, Financial & Cyber Fraud Unit prosecuted the case.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
Stockton Man Sentenced to over 4 Years in Prison for Unlawful Gun PossessionRead the Press Release
SACRAMENTO, Calif. — Anthony West, 46, of Stockton, was sentenced today by U.S. District Judge John A. Mendez to four years and nine months in prison for being a felon in possession of a firearm, U.S. Attorney Phillip A. Talbert announced.
According to court documents, on July 25, 2018, law enforcement officers obtained a warrant to search West’s residence. During that search, officers found a loaded .40 caliber Smith & Wesson pistol in West’s bedroom closet. Prior to the search, West had been convicted of six felony drug offenses.
This case was the product of an investigation by the Stockton Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the San Joaquin County District Attorney’s Office. Assistant U.S. Attorney Brian A. Fogerty prosecuted the case.
This case was prosecuted as part of the joint federal, state, and local Project Safe Neighborhoods (PSN) Program, the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
Statement of United States Attorney Breon Peace Regarding New Federal Ghost Guns RuleRead the Press Release
In May 2021, the Justice Department’s Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) issued a proposed rule to curb the proliferation of ghost guns—privately made firearms that are increasingly being recovered at crime scenes across the United States. Ghost guns generally do not have a serial number placed on the frame or receiver of the firearm. As a result, law enforcement faces obstacles when trying to determine where, by whom, or when these deadly ghost guns were manufactured, and to whom they were sold or otherwise disposed.
Yesterday, following a thorough and extensive public comment period, the Department announced the final rule. We commend our law enforcement partners at ATF for this important, life-saving new rule. The U.S. Attorney’s Office for the Eastern District of New York will use every tool at its disposal—both criminal and civil—to eliminate the scourge of illegal guns across New York City and across the country.
St. Paul Man Sentenced to Prison for Making Threats Against U.S. RepresentativeRead the Press Release
ST. PAUL, Minn. – A St. Paul man has been sentenced to a year and a day in prison followed by two years of supervised release for threatening a U.S. Representative, announced U.S. Attorney Andrew M. Luger.
According to court documents, on January 11, 2021, Jason Robert Burham Karimi, 32, left a voicemail on the office telephone of a U.S. Representative located in California. The voicemail contained graphic threats of violence directed at the U.S. Representative. The U.S. Capitol Police reviewed the voicemail and traced the telephone number to Karimi. On January 12, 2021, agents arranged to meet with Karimi near his St. Paul residence. Karimi told agents that he works as a lobbyist for the marijuana industry and the voicemail was meant to cause “political pain” to the U.S. Representative’s political career. Karimi admitted that he knew the voicemail he left would be perceived as a threat.
On September 8, 2021, Karimi pleaded guilty to one count of interstate communication of a threat. He was sentenced earlier today by Senior U.S. District Judge Paul A. Magnuson.
This case is the result of an investigation conducted by the FBI and the U.S. Capitol Police Department.
Assistant U.S. Attorney David P. Steinkamp prosecuted the case.
Springfield Man Sentenced to 20 Years for Producing Child PornographyRead the Press Release
SPRINGFIELD, Mo. – A Springfield, Missouri, man was sentenced in federal court today for producing child pornography and distributing those images over the internet.
Dennis Tyler Murray, 32, was sentenced by U.S. District Judge M. Douglas Harpool to 20 years in federal prison without parole.
On Oct 25, 2021, Murray pleaded guilty to one count of using a child to produce child pornography and one count of receiving and distributing child pornography.
On Sept. 29, 2020, law enforcement officers received three CyberTips from the National Center for Missing and Exploited Children after Google discovered multiple images of child pornography in Murray’s account. Murray had distributed the pornographic images of a 6-year-old victim to another user through Google Hangouts.
On Oct. 1, 2020, law enforcement officers executed a search warrant at Murray’s residence. Murray admitted he used his cell phone to take sexually explicit images of the child victim. Murray also admitted he sent some of those images through Google Hangouts. Officers seized Murray’s cell phone, which contained pornographic images of the child victim.
This case was prosecuted by Assistant U.S. Attorney Ami Harshad Miller. It was investigated by Homeland Security Investigations, the Southwest Missouri Cyber Crimes Task Force, and the Springfield, Mo., Police Department.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Springfield Man Sentenced for Meth ConspiracyRead the Press Release
SPRINGFIELD, Mo. – A Springfield, Mo., man was sentenced in federal court today for his role in a conspiracy to distribute methamphetamine.
Darrell Lynn Ferguson, 57, was sentenced by U.S. District Judge M. Douglas Harpool to 13 years and one month in federal prison without parole.
On Oct. 6, 2021, Ferguson pleaded guilty to participating in a conspiracy to distribute methamphetamine from March 12 to June 6, 2018. According to court documents, the conspiracy was responsible for distributing at least 32 pounds (14.15 kilograms) of methamphetamine.
Ferguson was arrested on June 6, 2018, in Apache County, Arizona. Ferguson was transporting approximately three pounds of methamphetamine and one pound of marijuana from California to Missouri. Ferguson was convicted in state court in Arizona and incarcerated for almost 31 months until he was transferred to federal custody in this case.
On April 12, 2018, law enforcement officers executed a search warrant at the residence of co-defendant Donnie Ray Overton, 60, of Springfield. Officers found approximately 646 grams of pure methamphetamine. Overton admitted that he originally purchased two pounds of methamphetamine from Ferguson and had sold half a pound. The methamphetamine had been delivered to him by co-defendant Laurita Jane Simmons, 37, of Springfield.
Overton and Simmons each have pleaded guilty to their roles in the drug-trafficking conspiracy and await sentencing.
This case is being prosecuted by Assistant U.S. Attorney Jessica R. Eatmon. It was investigated by the Drug Enforcement Administration, the Springfield, Mo., Police Department and the Apache County, Arizona, Sheriff’s Department.
Spencer, Iowa Man to Federal Prison for Possession of Stolen MailRead the Press Release
A man who possessed stolen mail was sentenced on April 5, 2022, in federal court in Sioux City.
Tony Steece, 37, from Spencer, Iowa, pled guilty to three counts of possession of stolen mail on November 2, 2021.
At the plea hearing, Steece admitted that on November 26, 2020, he was in possession of three pieces of mail not addressed to him. Evidence further showed that on the morning of November 26, 2020, the Spencer Police Department responded to a citizen’s complaint that someone was stealing mail from a mailbox. Steece was caught with his hand in a mailbox and told police that he was returning mail. Steece then fled police when officers tried to arrest him on outstanding warrants, running multiple stop signs, driving 80-85 mph in a 25-mph zone while inside Spencer city limits, and driving 126 mph in a 65 mph outside of city limits. When apprehended, Steece admitted to stealing mail. At the time of Steece’s arrest, he had in his possession a number of other pieces of mail, including three checks worth more than $500 in total.
Steece has a lengthy criminal history, including the repeated and prolonged harassment of women that the sentencing court described as “disgusting” and “obnoxious.”
Sentencing was held before United States District Court Chief Judge Leonard T. Strand. Steece was sentenced to 48 months’ imprisonment and must serve a 3-year term of supervised release following imprisonment. There is no parole in the federal system. Steece remains in custody of the United States Marshal until he can be transported to a federal prison.
The case was investigated by the United States Postal Inspection Service, the Spencer, Iowa Police Department, and the Dickinson and Clay County Sheriffs’ Offices. The case was prosecuted by Assistant United States Attorney Forde Fairchild.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 21-4065. Follow us on Twitter @USAO_NDIA.
Sioux City, Iowa Man to Federal Prison for Illegal Possession of FirearmsRead the Press Release
A man who illegally possessed two firearms was sentenced April 8, 2022, to more than two years in federal prison.
Criston Nunez-Morris, 21, from Sioux City, Iowa, received the prison term after a November 22, 2021, guilty plea to being a prohibited person in possession of a firearm.
Evidence at the plea and sentencing hearings showed Nunez-Morris was an unlawful user of marijuana, cocaine, and ecstasy when he knowingly possessed two guns, along with ammunition. The guns were stolen. Nunez-Morris also admitted that he possessed the guns in connection with his felonious drug trafficking. At the time of Nunez-Morris’ arrest, he was in possession of cocaine, marijuana, ecstasy, and a digital scale.
Nunez-Morris was sentenced in Sioux City by United States District Court Chief Judge Leonard T. Strand. Nunez-Morris was sentenced to 25 months’ imprisonment. He must also serve a two-year term of supervised release after the prison term. There is no parole in the federal system. Nunez-Morris is being held in the United States Marshal’s custody until he can be transported to a federal prison.
This case was brought as part of Project Safe Neighborhoods (PSN). PSN is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
The case was investigated by the Sioux City Police Department, Woodbury County Sheriff’s Office, and the Bureau of Alcohol, Tobacco, Firearms and Explosives, and prosecuted by Assistant United States Attorney Forde Fairchild.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 21-4024. Follow us on Twitter @USAO_NDIA.
Sedalia Man Sentenced for Murder for HireRead the Press Release
JEFFERSON CITY, Mo. – A Sedalia, Missouri, man has been sentenced in federal court for attempting to hire an undercover law enforcement agent to murder the victim in a pending statutory sodomy case.
Jon Mark Wilson, 58, was sentenced by U.S. District Judge Brian C. Wimes on April 5, 2022, to 10 years in federal prison without parole.
On Sept. 28, 2021, Wilson pleaded guilty to one count of the use of interstate facilities (the use of a cell phone and crossing state lines) in the commission of murder for hire. Wilson admitted that he paid $2,000 to an undercover agent with the Bureau of Alcohol, Tobacco, Firearms and Explosives to murder his alleged victim in a separate state case. Wilson has been charged in Pettis County, Mo., with two counts of felony first degree statutory sodomy in a case that is still pending.
Wilson solicited another person in January 2019 to arrange the murder for him so that he could avoid prosecution in the Pettis County case. That person contacted law enforcement authorities and helped arrange a meeting with Wilson and the undercover agent. Wilson agreed to hire the undercover agent to murder the intended victim. During that meeting, according to court documents, Wilson told the undercover agent he wished he could have the victim’s mother killed as well, but he did not have the money. Wilson said he hoped the victim’s mother would be so distraught over her child’s death that she would kill herself.
On Jan. 22, 2019, Wilson drove from Sedalia to Kansas City, Kansas, to meet with the undercover agent. Wilson paid the undercover agent $2,000, made arrangements to pay another $5,000 after the murder, and gave him a photo of the intended victim. Wilson also went into the Cabela’s store and purchased 25 shotgun shells for the undercover agent to use in the murder. When Wilson left the area, he was stopped and arrested by a Missouri State Highway Patrol trooper.
This case was prosecuted by Assistant U.S. Attorney Ashley S. Turner. It was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Missouri State Highway Patrol, and the Sedalia, Mo., Police Department.
Robert Morgan Pleads Guilty to Wire Fraud ConspiracyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051ROCHESTER, N.Y.-U.S. Attorney Trini E. Ross announced today that Robert Morgan pleaded guilty before Chief U.S. District Judge Elizabeth A. Wolford to conspiracy to commit wire fraud. The charge carries a maximum penalty of five years in prison and a $250,000 fine.
Assistant U.S. Attorneys Evan Glaberson and Paul Parisi, who are handling the case, stated that Morgan was the manager of Morgan Ellison Heights LLC, which was the majority owner of Ellison Heights Apartments LLC. In September 2016, Morgan, along with one or more co-conspirators, caused ESL Federal Credit Union to issue a construction loan based on inaccurate information regarding the construction contract price. Morgan saw and was aware of documents reflecting inaccurate information and agreed, along with one or more co-conspirators, for that information to be submitted to ESL to obtain a larger amount of the construction loan than what would have otherwise been supported by the actual figures.
The plea is the result of an investigation by the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Stephen Belongia, and the Federal Housing Finance Agency, Office of Inspector General, under the direction of Special Agent-in-Charge Robert Manchak, Northeast Region.
Sentencing is scheduled for July 22, 2022, before Judge Wolford.
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Redding Woman Agrees to Plead Guilty to Lying to Federal Agents Regarding Kidnapping and Defrauding the VictimRead the Press Release
SACRAMENTO, Calif. — A Redding woman has signed a plea agreement admitting that she planned and participated in her own hoax kidnapping and agreeing to plead guilty to making materially false statements to FBI agents about the circumstances of her disappearance and committing mail fraud based on her being a kidnapping victim, U.S. Attorney Phillip A. Talbert announced today.
Sherri Papini, 39, of Redding, was charged in a criminal information filed today in the U.S. District Court with thirty-four counts of mail fraud and one count of making false statements. In a plea agreement, also filed today, Papini agreed to plead guilty to a single count of mail fraud and one count of making false statements. Papini was arrested on March 3 based on a criminal complaint filed that day.
The court has not yet scheduled a date for Papini to enter her guilty pleas.
This case is the product of an investigation by the FBI and the Shasta County Sheriff’s Office with assistance from the California Department of Justice’s Bureau of Forensic Services and Bureau of Investigation, and the California Highway Patrol. Assistant U.S. Attorneys Veronica M.A. Alegría and Shelley D. Weger are prosecuting the case.
Papini faces a maximum statutory penalty of five years in prison and a fine up to $250,000 for making false statements to a federal law enforcement officer. She faces a maximum statutory penalty of 20 years in prison and a fine up to $250,000 for the count of mail fraud. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Providence Health & Services Agrees to Pay $22.7 Million to Resolve Liability from Medically Unnecessary Neurosurgery Procedures at Providence St. Mary’s Medical CenterRead the Press Release
Walla Walla, WA – Providence Health & Services Washington (Providence) has agreed to pay $22,690,458 to resolve allegations that it fraudulently billed Medicare, Medicaid, and other federal health care programs for medically unnecessary neurosurgery procedures, announced Vanessa R. Waldref, the United States Attorney for the Eastern District of Washington and Bob Ferguson, the Washington State Attorney General. Today’s joint settlement between Providence, the United States, and the State of Washington, which administers Washington’s Medicaid program using a combination of state and federal funding, is the largest-ever health care fraud settlement in the Eastern District of Washington.
Providence is a large health care and hospital system that operates 51 hospitals in seven western U.S. states, including Providence St. Mary’s Medical Center (Providence St. Mary’s) in Walla Walla, Washington. Between 2013 and 2018, Providence St. Mary’s employed neurosurgeons identified in the Settlement Agreement as Dr. A and Dr. B. Providence St. Mary’s paid neurosurgeons based on a productivity metric that provided them a financial incentive to perform more surgical procedures of greater complexity. Between 2014 and 2018, Dr. A was one of the highest producing neurosurgeons in the entire Providence system. Between 2014 and 2017, based on the productivity metric, Providence paid Dr. A between $2.5 million and $2.9 million per year. Today’s settlement resolves allegations that Providence falsely billed Medicare, Washington State Medicaid, and other federal health care programs for deficient and medically unnecessary neurosurgery procedures performed by Dr. A and Dr. B.
“Ensuring that surgical procedures are medically appropriate and properly performed is critical to building safe and strong communities here in the Eastern District of Washington,” said U.S. Attorney Waldref. “Patients with back pain and spinal injury deserve top-notch care from a provider who puts the patient first and is not improperly influenced by how much he can bill for the procedure. Providence’s failure to ensure that Dr. A and Dr. B were performing safe and medically-appropriate surgery procedures, despite repeated warnings, put patients’ lives and safety at serious risk. I am also gravely concerned that Providence’s decision not to report Dr. A or Dr. B to federal or state medical oversight bodies allowed both surgeons to simply resign from Providence and then continue to endanger patients at other hospitals.”
As part of the Settlement Agreement, Providence admitted that, during the time period in which Dr. A and Dr. B were employed at Providence St. Mary’s as neurosurgeons, Providence medical personnel articulated concerns that Dr. A and Dr. B: (1) were endangering the safety of patients; (2) created through their surgeries an excessive level of complications and negative outcomes; (3) performed surgery on candidates who were not appropriate for surgery; and (4) failed to properly document their procedures and outcomes. Providence further admitted that Providence medical personnel articulated additional concerns that Dr. A: (1) completed medical documentation with falsified and exaggerated diagnoses in order to obtain reimbursement from insurance providers; (2) performed surgical procedures that did not meet the medical necessity requirements set by Medicare and other insurance programs; (3) “over-operated”, i.e., performed surgeries of greater complexity and scope than were medically appropriate; and (4) jeopardized patient safety by attempting to perform an excessive number of overly complex surgeries. Finally, Providence admitted that, while it eventually placed both Dr. B and Dr. A on administrative leave in February 2017 and May 2018, respectively, it allowed both doctors to resign while on leave, and did not take any action to report Dr. A or Dr. B to the National Practitioner Data Bank or the Washington State Department of Health.
As part of the settlement, Providence entered into a Corporate Integrity Agreement (CIA) with the U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG). The CIA requires, among other things, that Providence implement and maintain a number of quality-of-care and patient safety obligations. Additionally, the CIA requires that Providence retain outside experts to perform annual claims and clinical quality systems reviews.
United States Attorney Waldref further stated, “While Providence’s conduct was extremely troubling, I do want to commend Providence for stepping up, accepting responsibility, taking appropriate and meaningful corrective action, and for fully cooperating with our investigation as well as agreeing to fully cooperate in our ongoing investigations. United States Attorney Waldref continued “I also want to express special appreciation for our close collaboration and partnership with the Washington Medicaid Fraud Control Division and with the whistleblower and his team, as well as the exceptional investigative work performed by HHS-OIG, Office of Personnel Management OIG, and Defense Criminal Investigative Service. We will continue to work closely with our state and federal law enforcement partners and with courageous whistleblowers to hold health care fraudsters accountable and to build safe and strong communities here in the Eastern District of Washington.”
“Patients trust their doctors that the care they receive is necessary, particularly when they are undergoing neurosurgery,” said Washington Attorney General Bob Ferguson. “Performing unnecessary surgeries for profit is a betrayal of that trust. I’m proud of the work we did with U.S. Attorney Waldref and our federal partners, and we look forward to continuing our work together to protect Medicaid dollars for those who need them.”
“Our agency will continue to hold accountable medical providers who perform medically unnecessary procedures and fraudulently bill federal health care programs,” said Special Agent in Charge Steven J. Ryan of the Department of Health and Human Services Office of Inspector General (HHS-OIG). “Working closely with our law enforcement partners, HHS-OIG remains committed to protecting the health of patients and the integrity of the taxpayer-supported programs serving them.”
“Patients must be able to trust that when providers recommend surgery it is because it is necessary, not because it is profitable,” said Amy K. Parker, Special Agent in Charge of the Office of Personnel Management’s Office of Inspector General. “I am grateful for the outstanding work of our agents and law enforcement partners who helped protect patients from harm.”
“This multi-million dollar settlement holds Providence and its former doctors accountable for dubious actions that endangered patient safety and defrauded various healthcare programs, including the Department of Defense’s TRICARE program,” said Bryan D. Denny, Special Agent in Charge of the Department of Defense Office of Inspector General, Defense Criminal Investigative Service (DCIS), Western Field Office. “DCIS remains committed to working with its law enforcement partners in protecting the integrity of federal healthcare programs, which facilitates an environment for our healthcare providers to be truly focused on quality patient care and safety.”
According to court documents, the case began in January 2020, when a whistleblower, the former Medical Director of neurosurgery at Providence-St Mary’s, filed a qui tam complaint under seal in the U.S. District Court for the Eastern District of Washington. When a whistleblower, or “relator,” files a qui tam complaint, the False Claims Act requires the United States to investigate the allegations and elect whether to intervene and take over the action or to decline to intervene and allow the relator to go forward with the litigation on behalf of the United States. The relator is generally able to then share in any recovery. In this case, according to court documents, the United States intervened in the action in January 2022, and subsequently reached this settlement. Pursuant to the settlement agreement, the relator will receive $4,197,734 of the total settlement amount.
The settlement was the result of a joint investigation conducted by the U.S. Attorney’s Office for the Eastern District of Washington; the State of Washington, Office of the Attorney General, Medicaid Fraud Control Division; the U.S. Department of Health and Human Services, Office of Inspector General, Seattle Field Office, the Defense Criminal Investigative Service, Seattle Field Office; and the Office of Personnel Management, Office of Inspector General, Western Regional Office. The United States Attorney’s Office would also like to express special thanks and appreciation for the logistical support provided by the Walla Walla Police Department. Assistant United States Attorneys Dan Fruchter and Tyler H.L. Tornabene of the Eastern District of Washington handled this matter on behalf of the United States.
U.S. Attorney Waldref will be addressing the case at a press conference at 10:00 a.m. on April 12, 2022 in front of the Thomas Foley Federal Courthouse building at 920 W. Riverside Avenue, Spokane, Washington. She will be joined by Larissa Payne, Director of the Medicaid Fraud Control Division for the Washington State Attorney General’s Office.
final_providence_settlement_agreement_fully_executed.pdfProject Manager for Mechanical Contractor Admits Role in Change Order Fraud SchemeRead the Press Release
Leonard C Boyle, United States Attorney for the District of Connecticut, announced that DON C. RICHARDS, 53, of Milford, waived his right to be indicted and pleaded guilty today before U.S. District Judge Kari A. Dooley in Bridgeport to a conspiracy charge stemming from his involvement in a construction project fraud scheme.
According to court documents and statements made in court, Richards was a senior project manager at a Massachusetts-based mechanical contractor. From November 2014 through February 2018, Richards conspired to defraud his employer and the project owners by inflating change orders on certain projects he was managing. As part of this conspiracy, a co-conspirator subcontractor, who was a principal of an insulation company, made payments to Richards and also for Richards’s benefit, including gift cards and funds for a golf club membership. Richards and the co-conspirator submitted inflated change orders to Richards’s employer to offset some of the costs of the payments the co-conspirator made to Richards.
Richards pleaded guilty to one count of conspiracy to commit wire fraud, which carries a maximum term of imprisonment of 20 years. He has agreed to pay restitution in the amount of $396,966.
Richards was arrested on October 19, 2021. He is released on a $100,000 bond pending sentencing, which is scheduled for July 5.
This investigation is being conducted by the Federal Bureau of Investigation and the Defense Criminal Investigative Service. The case is being prosecuted by Assistant U.S. Attorney David T. Huang, with assistance from the Department of Justice’s Antitrust Division, New York Office.
Physician Partners of America to Pay $24.5 Million to Settle Allegations of Unnecessary Testing, Improper Remuneration to Physicians and a False Statement in Connection with COVID-19 Relief FundsRead the Press Release
Physician Partners of America LLC (PPOA), headquartered in Tampa, Florida, its founder, Rodolfo Gari, and its former chief medical officer, Dr. Abraham Rivera, have agreed to pay $24.5 million to resolve allegations that they violated the False Claims Act by billing federal healthcare programs for unnecessary medical testing and services, paying unlawful remuneration to its physician employees and making a false statement in connection with a loan obtained through the Small Business Administration’s (SBA) Paycheck Protection Program (PPP). Certain PPOA affiliated entities are jointly and severally liable for the settlement amount, including the Florida Pain Relief Group, the Texas Pain Relief Group, Physician Partners of America CRNA Holdings LLC, Medical Tox Labs LLC and Medical DNA Labs LLC.
The United States alleged that PPOA caused the submission of claims for medically unnecessary urine drug testing (UDT), by requiring its physician employees to order multiple tests at the same time without determining whether any testing was reasonable and necessary, or even reviewing the results of initial testing (presumptive UDT) to determine whether additional testing (definitive UDT) was warranted. PPOA’s affiliated toxicology lab then billed federal healthcare programs for the highest-level UDT. In addition, PPOA incentivized its physician employees to order presumptive UDT by paying them 40% of the profits from such testing in violation of the Stark Law, which prohibits physicians from referring patients to receive “designated health services” payable to Medicare or Medicaid from entities with which the physician or an immediate family member has a financial relationship, unless an exception applies.
The United States further alleged that PPOA required patients to submit to genetic and psychological testing before the patients were seen by physicians, without making any determination as to whether the testing was reasonable and necessary, and then billed federal healthcare programs for the tests.
The United States further alleged that when Florida suspended all non-emergency medical procedures to reduce transmission of COVID-19 in March 2020, PPOA sought to compensate for lost revenue by requiring its physician employees to schedule unnecessary evaluation and management (E/M) appointments with patients every 14 days, instead of every month as had been PPOA’s prior practice. PPOA then instructed its physicians to bill these E/M visits using inappropriate high-level procedure codes. Moreover, the United States alleged that at the same time PPOA was engaged in this unlawful overbilling, PPOA falsely represented to the SBA that it was not engaged in unlawful activity in order to obtain a $5.9 million loan through the PPP. The settlement announced today resolves liability under the False Claims Act and the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) arising from the false claims submitted to federal healthcare programs for the E/M visits as well for PPOA’s false statement in connection with its PPP loan.
“Billing federal healthcare programs for services that providers know are unnecessary or unreasonable undermines the quality of care that patients receive and increases the costs of these taxpayer-funded programs,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department is committed to ensuring that healthcare providers base their treatment decisions on their patients’ needs rather than their own financial interests.”
“Holding healthcare providers accountable for inflated claims and false statements helps ensure the integrity of the healthcare system as a whole,” said U.S. Attorney Roger B. Handberg for the Middle District of Florida. “Settlements like this one are an important step in that direction.”
“Since the beginning of the pandemic, the SBA has been focused on providing relief swiftly, equitably and efficiently to millions of struggling small business owners – ensuring that relief has been distributed with the utmost integrity has been central to that mission under Administrator Guzman,” said General Counsel Peggy Delinois Hamilton for the SBA. “The SBA takes fraud seriously and will continue to make it our priority to work alongside the Office of the Inspector General to identify and address any potential fraud to ensure sound administration of relief programs.”
In connection with the settlement, PPOA also entered into a five-year Corporate Integrity Agreement (CIA) with the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG). Under the CIA, PPOA agreed to undertake significant compliance efforts, including: maintain a compliance department, medical director and oversight board; retain a compliance expert; provide management certifications; maintain written standards, training and education; obtain multiple annual claims reviews by an Independent Review Organization; establish a risk assessment and internal review process; and implement monitoring of testing referrals.
“When health care providers bill taxpayer-funded health care programs for medically unnecessary services, they divert government funds designed to assist business owners during this pandemic,” said Special Agent in Charge Omar Pérez Aybar of HHS-OIG. “Our agency will work with our law enforcement partners to thoroughly investigate health care fraud schemes.”
“This settlement allows OWCP to recover medical bill payments under the Federal Employees’ Compensation Act and return those funds to the Employees’ Compensation Fund,” said Director Christopher Godfrey of the Department of Labor (DOL) Office of Workers’ Compensation Programs (OWCP). “The Department of Labor’s Office of Inspector General, as well as various other agencies’ offices of inspector general (OIG), devote significant investigative resources to detecting cases of possible abuse within the FECA program, and this settlement demonstrates the commitment of the DOL and its OIG in helping to ensure that funds issued through the program are paid appropriately.”
“When actors within our health care system are focused on profit rather than patient care, it undermines the integrity of the medical decision-making process,” said Special Agent in Charge Cynthia A. Bruce of the Department of Defense Office of Inspector General, Defense Criminal Investigative Service (DCIS), Southeast Field Office. “DCIS will continue to work with our investigative partners to protect the funding entrusted to the Defense Health Agency that serves our military members and their families.”
“Veterans Affairs' Community Care programs provide veterans and their families the ability to obtain critical healthcare services from providers within their own communities,” said Special Agent in Charge David Spilker of the Department of Veterans Affairs Office of Inspector General’s (VA OIG) Southeast Field Office. “This civil settlement reinforces the VA OIG’s commitment to safeguarding the integrity of VA’s healthcare programs and operations and preserving taxpayer funds.”
“When providers submit false claims for medically unnecessary tests, they are not only violating their patients’ trust but also compromising the integrity of the Federal Employees Health Benefits Program (FEHBP),” said Special Agent in Charge Amy K. Parker of the U.S. Office of Personnel Management, Office of the Inspector General (OPM OIG). “This settlement demonstrates the OPM OIG’s commitment to protecting patients from tests that are not medically reasonable or necessary and safeguarding the FEHBP from fraudulent claims.”
The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by Donald Haight, Dawn Baker, Dr. Harold Cho, Dr. Venus Dookwah-Roberts and Dr. Michael Lupi, who are current or former employees of PPOA or its affiliated entities. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. The qui tam cases are captioned United States ex rel. Haight v. Physician Partners of Am.; United States ex rel. Baker v. Physician Partners of Am LLC; United States ex rel. Lupi v. Physician Partners of Am. LLC; and United States ex rel. Dookwah-Roberts v. Physician Partners of Am. LLC.
The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section; the U.S. Attorney’s Office for the Middle District of Florida; HHS-OIG; VA OIG; DCIS; DOL OIG; and OPM OIG.
The investigation and resolution of this matter illustrates the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
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 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. Tips and complaints from all sources about potential fraud affecting COVID-19 government relief programs can be reported by visiting the webpage of the Civil Division’s Fraud Section, which can be found here. Anyone with information about allegations of attempted fraud involving COVID-19 can also report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
The matter was handled by Senior Trial Counsel David W. Tyler of the Civil Division and Assistant U.S. Attorney Lindsay Saxe Griffin for the Middle District of Florida.
The claims resolved by the settlement are allegations only and there has been no determination of liability.
Physician Partners of America to Pay $24.5 Million to Settle Allegations of Unnecessary Testing, Improper Remuneration to Physicians and a False Statement in Connection with COVID-19 Relief FundsRead the Press Release
Physician Partners of America LLC (PPOA), headquartered in Tampa, Florida, its founder, Rodolfo Gari, and its former chief medical officer, Dr. Abraham Rivera, have agreed to pay $24.5 million to resolve allegations that they violated the False Claims Act by billing federal healthcare programs for unnecessary medical testing and services, paying unlawful remuneration to its physician employees and making a false statement in connection with a loan obtained through the Small Business Administration’s (SBA) Paycheck Protection Program (PPP). Certain PPOA affiliated entities are jointly and severally liable for the settlement amount, including the Florida Pain Relief Group, the Texas Pain Relief Group, Physician Partners of America CRNA Holdings LLC, Medical Tox Labs LLC and Medical DNA Labs LLC.
The United States alleged that PPOA caused the submission of claims for medically unnecessary urine drug testing (UDT), by requiring its physician employees to order multiple tests at the same time without determining whether any testing was reasonable and necessary, or even reviewing the results of initial testing (presumptive UDT) to determine whether additional testing (definitive UDT) was warranted. PPOA’s affiliated toxicology lab then billed federal healthcare programs for the highest-level UDT. In addition, PPOA incentivized its physician employees to order presumptive UDT by paying them 40% of the profits from such testing in violation of the Stark Law, which prohibits physicians from referring patients to receive “designated health services” payable to Medicare or Medicaid from entities with which the physician or an immediate family member has a financial relationship, unless an exception applies.
The United States further alleged that PPOA required patients to submit to genetic and psychological testing before the patients were seen by physicians, without making any determination as to whether the testing was reasonable and necessary, and then billed federal healthcare programs for the tests.
The United States further alleged that when Florida suspended all non-emergency medical procedures to reduce transmission of COVID-19 in March 2020, PPOA sought to compensate for lost revenue by requiring its physician employees to schedule unnecessary evaluation and management (E/M) appointments with patients every 14 days, instead of every month as had been PPOA’s prior practice. PPOA then instructed its physicians to bill these E/M visits using inappropriate high-level procedure codes. Moreover, the United States alleged that at the same time PPOA was engaged in this unlawful overbilling, PPOA falsely represented to the SBA that it was not engaged in unlawful activity in order to obtain a $5.9 million loan through the PPP. The settlement announced today resolves liability under the False Claims Act and the Financial Institutions Reform, Recovery and Enforcement Act (FIRREA) arising from the false claims submitted to federal healthcare programs for the E/M visits as well for PPOA’s false statement in connection with its PPP loan.
“Billing federal healthcare programs for services that providers know are unnecessary or unreasonable undermines the quality of care that patients receive and increases the costs of these taxpayer-funded programs,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department is committed to ensuring that healthcare providers base their treatment decisions on their patients’ needs rather than their own financial interests.”
“Holding healthcare providers accountable for inflated claims and false statements helps ensure the integrity of the healthcare system as a whole,” said U.S. Attorney Roger B. Handberg for the Middle District of Florida. “Settlements like this one are an important step in that direction.”
“Since the beginning of the pandemic, the SBA has been focused on providing relief swiftly, equitably and efficiently to millions of struggling small business owners – ensuring that relief has been distributed with the utmost integrity has been central to that mission under Administrator Guzman,” said General Counsel Peggy Delinois Hamilton for the SBA. “The SBA takes fraud seriously and will continue to make it our priority to work alongside the Office of the Inspector General to identify and address any potential fraud to ensure sound administration of relief programs.”
In connection with the settlement, PPOA also entered into a five-year Corporate Integrity Agreement (CIA) with the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG). Under the CIA, PPOA agreed to undertake significant compliance efforts, including: maintain a compliance department, medical director and oversight board; retain a compliance expert; provide management certifications; maintain written standards, training and education; obtain multiple annual claims reviews by an Independent Review Organization; establish a risk assessment and internal review process; and implement monitoring of testing referrals.
“When health care providers bill taxpayer-funded health care programs for medically unnecessary services, they divert government funds designed to assist business owners during this pandemic,” said Special Agent in Charge Omar Pérez Aybar of HHS-OIG. “Our agency will work with our law enforcement partners to thoroughly investigate health care fraud schemes.”
“This settlement allows OWCP to recover medical bill payments under the Federal Employees’ Compensation Act and return those funds to the Employees’ Compensation Fund,” said Director Christopher Godfrey of the Department of Labor (DOL) Office of Workers’ Compensation Programs (OWCP). “The Department of Labor’s Office of Inspector General, as well as various other agencies’ offices of inspector general (OIG), devote significant investigative resources to detecting cases of possible abuse within the FECA program, and this settlement demonstrates the commitment of the DOL and its OIG in helping to ensure that funds issued through the program are paid appropriately.”
“When actors within our health care system are focused on profit rather than patient care, it undermines the integrity of the medical decision-making process,” said Special Agent in Charge Cynthia A. Bruce of the Department of Defense Office of Inspector General, Defense Criminal Investigative Service (DCIS), Southeast Field Office. “DCIS will continue to work with our investigative partners to protect the funding entrusted to the Defense Health Agency that serves our military members and their families.”
“Veterans Affairs' Community Care programs provide veterans and their families the ability to obtain critical healthcare services from providers within their own communities,” said Special Agent in Charge David Spilker of the Department of Veterans Affairs Office of Inspector General’s (VA OIG) Southeast Field Office. “This civil settlement reinforces the VA OIG’s commitment to safeguarding the integrity of VA’s healthcare programs and operations and preserving taxpayer funds.”
“When providers submit false claims for medically unnecessary tests, they are not only violating their patients’ trust but also compromising the integrity of the Federal Employees Health Benefits Program (FEHBP),” said Special Agent in Charge Amy K. Parker of the U.S. Office of Personnel Management, Office of the Inspector General (OPM OIG). “This settlement demonstrates the OPM OIG’s commitment to protecting patients from tests that are not medically reasonable or necessary and safeguarding the FEHBP from fraudulent claims.”
The civil settlement includes the resolution of claims brought under the qui tam or whistleblower provisions of the False Claims Act by Donald Haight, Dawn Baker, Dr. Harold Cho, Dr. Venus Dookwah-Roberts and Dr. Michael Lupi, who are current or former employees of PPOA or its affiliated entities. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. The qui tam cases are captioned United States ex rel. Haight v. Physician Partners of Am.; United States ex rel. Baker v. Physician Partners of Am LLC; United States ex rel. Lupi v. Physician Partners of Am. LLC; and United States ex rel. Dookwah-Roberts v. Physician Partners of Am. LLC.
The resolution obtained in this matter was the result of a coordinated effort between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section; the U.S. Attorney’s Office for the Middle District of Florida; HHS-OIG; VA OIG; DCIS; DOL OIG; and OPM OIG.
The investigation and resolution of this matter illustrates the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
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 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. Tips and complaints from all sources about potential fraud affecting COVID-19 government relief programs can be reported by visiting the webpage of the Civil Division’s Fraud Section, which can be found here. Anyone with information about allegations of attempted fraud involving COVID-19 can also report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
The matter was handled by Senior Trial Counsel David W. Tyler of the Civil Division and Assistant U.S. Attorney Lindsay Saxe Griffin for the Middle District of Florida.
The claims resolved by the settlement are allegations only and there has been no determination of liability.
Owner of construction company and Puget Sound properties involved in illegal production of marijuana sentenced to 6 years in prisonRead the Press Release
Seattle – A 52-year-old Seattle-area man was sentenced today in U.S. District Court in Seattle to 6 years in prison for his schemes involving the illegal manufacturing of marijuana, announced U.S. Attorney Nick Brown. Raymond Ng engaged in conspiracies to facilitate illegal marijuana grows in residential neighborhoods, and to launder the proceeds through businesses and properties. At the sentencing hearing U.S. District Judge John C. Coughenour said “Ng continued his conduct after he had plenty of warning that it was criminal, and he was at risk.”
“Mr. Ng’s scheme was damaging to our community on many levels,” said U.S. Attorney Brown. “The illegal marijuana grows are at risk for electrical fires, drug rip-offs by other criminals, and mold and chemical contamination from the growing process. Violating Washington State law on marijuana production harms the regulated market. And buying homes with drug proceeds and converting them to grow houses hurts homebuyers trying to get a toehold in the real estate market.”
According to records filed in the case, Ng’s involvement in the illegal marijuana business appears to have begun as early as 2016, when he purchased a house near a Renton elementary school and rented it to an employee of his construction company to grow marijuana. The house was searched by law enforcement in June 2017, resulting in the seizure of 533 plants. This house was later sold by Ng, but on his seller disclosure statement he lied and said the house had not been used for drug manufacturing.
Despite the search of his property, Ng continued to help others illegally grow marijuana in residences around Seattle. He rented his own properties to illegal marijuana growers, and helped others buy properties that were used to illegally grow marijuana. When a grow was searched by law enforcement, Ng’s construction company would renovate the property, and his real estate company would help to sell it. Through these many services, Ng helped to spread illegal marijuana grows in Puget Sound neighborhoods.
“Illegal marijuana grows only serve to damage our community” said Inspector in Charge Anthony Galetti. “By circumventing Washington State’s law on legal marijuana we saw the home next door turned into an underground production facility. From fires caused by shoddy electrical wiring to pesticides and chemical running into local waters, these grows put the workers and our community in harm’s way. With Ng’s sentencing we hope this serves as a warning to all others, these grows are dangerous and have no place in our neighborhoods or in the U.S. Mail.”
Ng also conspired to launder drug proceeds, working with his co-conspirator to use illegal marijuana proceeds to pay for properties. Ng used his position as a successful businessman to lie to a mortgage company so that an employee of his construction business could purchase a house, which the employee then used to grow marijuana.
Ng’s girlfriend, Qifang Chen, 33, who was pregnant when she and Ng were arrested in this case, was also charged in the scheme. She was sentenced to six months of home confinement and three years of probation.
Ng has been in custody since his arrest in October 2020. As part of a larger investigation, law enforcement searched Ng’s home as well as dozens of other locations in Washington, Oregon and New York seizing 13,000 marijuana plants, more than 500 kilograms of processed marijuana, 20 firearms, and millions of dollars in cash and properties. At Ng’s home they seized more than $300,000 in cash, which Ng admitted were drug proceeds. Ng is forfeiting more than $750,000 as part of his sentence.
In asking for an 87-month sentence, prosecutors wrote to the court, Ng “used his successful business as a front to launder drug proceeds. He used his experience as a real estate agent to ease the purchase and sale of marijuana grow houses. And he used his position as the owner of businesses to lie to mortgage companies and the government. In many ways, it was precisely Ng’s professional accomplishments that allowed him to break the law.”
“Today’s sentencing is a testament to the dedication and hard work each and every member of the King County Sheriff’s Office invested in this case,” said interim King County Sheriff Patti Cole-Tindall. “When we work with the Department of Justice and other federal partners to combat trafficking and other criminal enterprises, communities throughout King County are safer.”
“Everyone has an obligation to abide by the laws at the federal, state, and local levels. When individuals like Mr. Ng and Ms. Chen choose to flout these laws for their own illegal enrichment, they betray the trust of their communities and the public,” said Special Agent in Charge Bret Kressin, IRS Criminal Investigation (IRS:CI), Seattle Field Office. “With our expertise in ‘following the money,’ IRS:CI is committed to working with our partners in law enforcement to bring criminals like these to justice.”
This case 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 case was investigated by the U.S. Postal Inspection Service (USPIS) and the Internal Revenue Service Criminal Investigation (IRS-CI) and the King County Sheriff’s Office. The Drug Enforcement Administration (DEA), the FBI, and Homeland Security Investigations (HSI) and the Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF) assisted with the search warrants in October 2020.
The case is being prosecuted by Assistant United States Attorneys Nicholas Manheim and Stephen Hobbs.
Illegal marijuana growNorthrop Grumman Agrees to Pay the United States $35 Million for Cleanup Costs at Bethpage Site CostsRead the Press Release
Breon Peace, United States Attorney for the Eastern District of New York, and Karnig Ohannessian, Deputy Assistant Secretary of the Navy (Environment & Mission Readiness), announced today that Northrop Grumman has agreed to pay the United States $35 million for environmental cleanup costs incurred as a result of operations at the former Naval Weapon Industrial Reserve Plant (NWIRP) in Bethpage, New York, and adjacent facilities (Sites). The payment resolves a civil lawsuit brought by the United States against Northrop Grumman under the federal Comprehensive Environmental Response, Compensation and Liability Act (CERCLA).
“This settlement compensates the United States for some of the enormous costs it has expended in connection with the cleanup of the former Naval Weapon Industrial Reserve Plant in Bethpage,” stated United States Attorney Peace. “The government’s remediation at the site restores natural resources, including land and groundwater in the area, and ensures public health and safety.”
A Consent Judgment setting forth the terms of the settlement provides that Northrop Grumman and the Navy will continue their respective remedial actions associated with the Sites and coordinate their cleanup efforts to benefit the public.
The proposed Consent Judgment will be lodged with the District Court for a period of at least 30 days, and notice of the Consent Judgment will be published in the Federal Register. This will afford members of the public the opportunity to submit comments on the Consent Judgment to the Department of Justice prior to it seeking court approval of the settlement.
The NWIRP was a government-owned, contractor-operated facility where Northrop Grumman’s predecessors (collectively “Grumman”) designed and manufactured aircraft for the Navy. Grumman also owned the adjacent approximately 500-acre former Northrop Grumman Bethpage Facility Site, which included an 18-acre property, now part of the Bethpage Community Park. Grumman used the Sites for industrial and research purposes from the late 1930s through1996. Manufacturing and disposal practices at the Sites resulted in contamination of the soil and groundwater with hazardous substances, including volatile organic compounds (VOCs), polychlorinated biphenyls (PCBs) and metals.
The Navy began conducting investigations and assessments at the NWIRP in 1986, and the cleanup is ongoing. The Navy continues to implement its remedial actions, including for treatment of contaminated groundwater.
The Navy’s remediation efforts include:
- Remediation of contaminated soils and shallow groundwater at the NWIRP through soil excavation, use of a vapor extraction system to remove TCE contamination from the soil, and placement of soil covers and land use controls;
- Design, implementation, operation and maintenance of onsite groundwater extraction wells and treatment systems to capture and treat VOCs before they migrate off property;
- Off-property groundwater capture and treatment of hotspots to reduce contaminant mass in the plume and limit downgradient migration;
- Additional treatment wells to intercept, as practicable, the southern extent of the site-related groundwater plumes;
- Installation of groundwater monitoring wells and long-term monitoring;
- Investigation and remediation of site-related 1-4 dioxane in the groundwater;
- Development and implementation of a public water supply protection program.
In addition to the costs associated with such Navy cleanup activities, since 2010, the United States has incurred costs under several consent judgments with local water districts whose water supply wells are potentially affected by the plumes to ensure their continued provision of safe drinking water.
The case was handled by Assistant United States Attorneys Kathleen Mahoney and Matthew Silverman from the United States Attorney’s Office for the Eastern District of New York, and by Richard Green, Assistant Director for Affirmative Environmental Claims, Office of General Counsel, Naval Litigation Office, Department of the Navy.
Additional information concerning the Navy’s cleanup and site-related public engagement activities can be found online at: http://go.usa.gov/DyXF. The Navy also maintains a public repository of site-related materials at the Bethpage Public Library, 47 Powell Avenue, Bethpage, New York 11714, (516) 931-3907.
E.D.N.Y. Docket No. 22-CV-2101
Nine Members and Associates of Nationwide Sex Trafficking and Prostitution Enterprise Indicted on Racketeering and Related ChargesRead the Press Release
Defendant Instructed Enforcer: “If She Dares Fight Back, Beat Her More Viciously. Get Some Results from the Beating.”
A 20-count indictment was unsealed today in federal court in Brooklyn variously charging Siyang Chen, Siyu Chen, also known as “Ban Ban,” Bo Jiang, Meizhen Song, also known as “Die Die,” Rong Rong Xu, also known as “Eleanor,” Jiarun Yan, also known as “Raymond Yan” and “Mike,” Jilong Yu, Carlos Cury and Zerong Tang with racketeering, sex trafficking, Hobbs Act robbery and violent assaults. The operation was based in Queens, New York, but carried out crimes throughout the United States, including in Hawaii, Kansas, Michigan, Missouri, Nebraska, New Hampshire, Oregon, Texas and Washington. Eight defendants were arrested today and will be arraigned this afternoon before United States Magistrate Judge Roanne L. Mann.
Breon Peace, United States Attorney for the Eastern District of New York, and Michael J. Driscoll Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI) and Keechant L. Sewell, Commissioner, New York City Police Department (NYPD), announced the arrests and charges.
“As alleged, the defendants targeted vulnerable women for sex trafficking, and brutally assaulted the victims to enforce loyalty to the criminal enterprise. Human beings are not property, and the victims in this case, regardless of their immigration status, deserve to be free from violence and coerced sexual activity. It is our hope that today’s arrests will bring them some measure of justice for the horror that they have endured,” stated United States Attorney Peace. “This case is another example of our Office’s longstanding commitment to bringing to justice sex trafficking organizations that exploit and dehumanize victims for financial gain.”
“The conduct alleged today spells out years of abuse inflicted upon vulnerable women on behalf of those who orchestrated this nationwide sex trafficking and prostitution enterprise,” stated FBI Assistant Director-in-Charge. “Victims in this case should know the FBI’s Joint Asian Criminal Enterprise Task Force won’t tolerate the actions of those who offer the sexual activities of others in exchange for payment. If you’re a victim or have information to provide, we want to hear from you—regardless of your immigration status. Call us at 1-800-CALL-FBI or submit a tip online at tips.fbi.gov.”
“Our job is to ensure that anyone who would seek to profit through the abuse and exploitation of another human being be brought to justice swiftly and successfully,” stated NYPD Commissioner Sewell. “Today’s charges also further affirm the NYPD’s unwavering commitment to protecting the survivors of sex trafficking. To that end, I thank and commend the U.S. Attorney’s Office for the Eastern District and our partners at the FBI for their immeasurable support in building this critical case.”
As set forth in court filings, between April 2019 and September 2021, the defendants participated in a violent and organized racketeering enterprise, which operated a lucrative prostitution business throughout the United States. The enterprise recruited women, most of whom were from China and lacked legal status in the United States, to engage in prostitution for the enterprise. The victims were sometimes required to provide copies of their identification documents so that the defendants could maintain even more control over them. The enterprise arranged for the women to travel from New York to locations throughout the country, stay in hotels and enterprise-operated apartments for weeks at a time and engage in commercial sex. Members and associates of the organization collected money from the women and the organization then used those illicit proceeds to promote its sex trafficking and interstate prostitution activities — and enrich its members.
As alleged, between January 8, 2020 and September 1, 2021, members and associates of the enterprise directed and conducted more than 15 violent assaults of women across five states. The victims were Chinese women who the organization believed were providing commercial sex services on their own or for rival organizations. By committing these violent assaults, members of the organization sought to enforce discipline and believed their conduct would not be prosecuted because the victims were not U.S. citizens and were engaged in commercial sex work. Specifically, members and associates of the enterprise would direct individuals to pretend to be johns to gain access to their hotel rooms and, once inside, would restrain the women with zip-ties, beat them with hammers, bats and other blunt objects, and rob them. Members of the organization often encouraged increasingly severe beatings of the victims if the initial attack did not sufficiently injure them. In one phone message that was recovered by law enforcement, a member instructed the enforcer: “Beat [her] to death tomorrow. If she dares fight back, beat her more viciously. Get some results from the beating. Can’t waste the money.” In another recovered chat, a member advised, “One person choke her by her throat, the other person strike her four limbs to death. Definitely don’t make a sound. Beat her to the point where she can’t fight back.”
The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.
Mr. Peace praised the outstanding investigative work of the FBI and the NYPD. This investigation was aided by law enforcement agencies throughout the country. Mr. Peace expressed his thanks to the United States Attorney’s Office for the District of Nebraska, as well as the Oklahoma City and Manchester field offices of United States Homeland Security Investigations and United States Immigration & Customs Enforcement. In addition, local police departments across the United States provided invaluable assistance, including the Beaverton (Oregon) Police Department, Michigan State Police, Missouri Highway Patrol, Oklahoma City (Oklahoma) Police Department, Omaha (Nebraska) Police Department, Overland Park (Kansas) Police Department, Portland (Oregon) Police Department, Southfield (Michigan) Police Department, and Troy (Michigan) Police Department.
The government’s case is being prosecuted by the office’s Organized Crime and Gangs and Civil Rights Sections. Assistant United States Attorneys Matthew R. Galeotti, Kayla C. Bensing and Sophia M. Suarez are in charge of the prosecution.
The FBI’s New York Joint Asian Criminal Enterprise Task Force believes this enterprise may be responsible for the assaults of even more commercial sex workers throughout the country. If you are a victim or have information to provide, there are several ways to contact the FBI: send a tip online at https://tips.fbi.gov/ or call 1-800-CALL-FBI. They have people ready to work with you in your native language, regardless of your immigration status. Please select English when prompted and ask the operator for a translator by stating your language of choice. Online tips may be submitted in any language. In an emergency, always call 911 for the police.
The Defendants:
SIYANG CHEN
Age: 32
Queens, New YorkSIYU CHEN, also known as “Ban Ban,”
Age: 24
Queens, New YorkBO JIANG
Age: 26
Queens, New YorkMEIZHEN SONG, also known as “Die Die,”
Age: 23
Dallas, TexasRONG RONG XU, also known as “Eleanor,”
Age: 29
Queens, New YorkJIARUN YAN, also known as “Raymond Yan” and “Mike,”
Age: 28
Queens, New YorkJILONG YU
Age: 23
Dallas, TexasCARLOS CURY
Age: 41
Queens, New YorkZERONG TANG
Age: 24
Queens, New YorkNewton Man Sentenced to 9 Years for Receipt of Child Sexual Abuse MaterialRead the Press Release
CONCORD - Anthony Rimas, 48, of Newton, was sentenced on Monday to 108 months in federal prison for receipt of child sexual abuse material, United States Attorney John J. Farley announced today.
According to court documents and statements made in court, in October 2020, law enforcement officers with the New Hampshire Internet Crimes Against Children Task Force (NHICAC) were conducting online investigations into individuals using digital applications that share images of child sexual abuse material. During the investigation, investigators uncovered evidence that Rimas received and possessed images and video files of child sexual abuse materials.
“Those who obtain and view child sexual abuse material are further victimizing the innocent children whose abuse is depicted in these images,” said U.S. Attorney Farley. “To protect young people from exploitation, we will continue to seek substantial penalties for those who commit crimes related to child sexual abuse material. Along with the New Hampshire Internet Crimes Against Children Task Force and our other law enforcement partners we are working tirelessly to hold these criminals accountable for their unlawful actions.”
Rimas previously pleaded guilty on September 2, 2021. After completion of his prison sentence, Rimas will be under 8 years of supervised release.
This matter was investigated by the New Hampshire Internet Crimes Against Children Task Force and the Nashua Police Department. The case was prosecuted by Assistant U.S. Attorney Anna Krasinski.
In February 2006, the Department of Justice introduced Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the United States Attorney’s Offices, 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 identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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New York Lieutenant Governor Brian Benjamin Charged with Bribery and Related OffensesRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, Michael J. Driscoll, the Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and Jocelyn E. Strauber, Commissioner of the New York City Department of Investigation (“DOI”), announced today that BRIAN BENJAMIN, the Lieutenant Governor of the State of New York, was charged with bribery and related offenses. In particular, BENJAMIN is charged with bribery, honest services wire fraud, and conspiracy to commit those offenses, based on BENJAMIN’s use of his official authority while a New York state senator to direct a state-funded grant to an organization controlled by a real estate developer (“CC-1”) in exchange for campaign contributions made and procured by CC-1. BENJAMIN is also charged with two counts of falsifying records in connection with the preparation of contribution forms that falsely reported certain contributions made by CC-1 as being made by other individuals, and false statements BENJAMIN made in a questionnaire he submitted while seeking to become Lieutenant Governor. BENJAMIN surrendered to the FBI in Manhattan this morning and was presented before United States Magistrate Judge Ona T. Wang. The case has been assigned to United States District Judge J. Paul Oetken.
U.S. Attorney Damian Williams said: “As alleged, Brian Benjamin used his power as a New York state senator to secure a state-funded grant in exchange for contributions to his own political campaigns. By doing so, Benjamin abused his power and effectively used state funds to support his political campaigns. My Office and our partners at the FBI and DOI will continue to ensure that politicians who put themselves over the public interest will be prosecuted.”
FBI New York Assistant Director-in-Charge Michael J. Driscoll said: “Exploiting one’s official authority by allocating state funds as part of a bribe to procure donations to a political campaign, and engaging in activity to cover up the bribe, is illegal. As we allege today, Benjamin’s conduct in this scheme directly circumvents those procedures put in place to keep our systems fair.”
DOI Commissioner Jocelyn E. Strauber said: “As charged, Lieutenant Governor Benjamin, while a New York State senator, used his official position to obtain donations to his political campaigns. He allegedly allocated public grant funds to a non-profit controlled by a co-conspirator in exchange for campaign contributions, and then lied to hide this illegal scheme. In so doing, he served his own interests at the expense of his constituents, a betrayal of the public trust and a violation of federal law. DOI stands with our law enforcement partners in the United States Attorney’s Office for the Southern District of New York and the FBI in the fight to expose and prevent corruption.”
According to the allegations in the Indictment[1] filed today in Manhattan federal court:
Overview
From at least in or about 2019, up to and including at least in or about 2021, BENJAMIN participated in a scheme to obtain campaign contributions from CC-1 in exchange for BENJAMIN’s use of his official authority and influence as a New York State senator to obtain a $50,000 state-funded grant (the “Grant”) for a non-profit organization controlled by CC-1 (“Organization-1”). BENJAMIN and others acting on his behalf or at his direction then engaged in a series of lies and deceptions to cover up his scheme, including by falsifying campaign donor forms, misleading city regulators, and providing false information on vetting forms he completed while seeking to be the Lieutenant Governor of New York State.
The Bribery Scheme
In or about March 2019, BENJAMIN met with CC-1, told CC-1 that he was running for the office of New York City Comptroller, and asked that CC-1 procure a number of small-dollar contributions from different individuals for that campaign (the “Comptroller Campaign”). CC-1 told BENJAMIN that CC-1 did not have experience bundling political contributions in that manner; that CC-1 focused CC-1’s fundraising efforts on Organization-1; and that CC-1’s ability to procure numerous contributions for BENJAMIN’s Comptroller Campaign was limited, including because potential donors from whom CC-1 was likely to solicit contributions were the same donors from whom CC-1 had solicited and intended to further solicit contributions for Organization-1. In response, BENJAMIN told CC-1, “Let me see what I can do.”
In or about February 2019, before the above-described meeting, BENJAMIN had formally requested funding from the Majority Leader of the New York State Senate for certain organizations and entities in his district, including another Harlem-based educational organization (“Organization-2”). Organization-1 was not on that list, even though BENJAMIN had been aware of Organization-1 and its educational work since at least 2018.
On or about May 30, 2019, the Senate Majority Leader and her staff informed certain senators, including BENJAMIN, that they had been awarded additional discretionary funding that each could allocate to organizations in their districts for specified purposes. That additional funding included, among other things, up to $50,000 that BENJAMIN could allocate to school districts, libraries, or non-profit organizations for educational purposes. BENJAMIN then called CC-1, told CC-1 he would be obtaining a $50,000 grant for Organization-1, and directed that the $50,000 be allocated to Organization-1. BENJAMIN chose not to allocate that funding to Organization-2, despite the fact that Organization-2 had not received the funding BENJAMIN requested in the February 2019 letter.
On or about June 19, 2019, the New York State senate approved a resolution that, among other things, allocated $50,000 to Organization-1. The following day, BENJAMIN sent a text message to CC-1 with a screenshot of the resolution and stated, among other things, “I will call to discuss!”
On or about July 8, 2019, BENJAMIN met with CC-1. CC-1 provided BENJAMIN with three checks totaling $25,000 made out to BENJAMIN’s New York State senate campaign (the “Senate Campaign”). Two of the checks were written in the names of relatives of CC-1 who did not share CC-1’s last name, and the third was written in the name of a limited liability corporation that CC-1 controlled (the “CC-1 LLC”). CC-1 made the contributions in the names of two other individuals and the CC-1 LLC to conceal any connection between CC-1 and the contributions. Because BENJAMIN had not yet filed a certification regarding his Comptroller Campaign with the New York City Campaign Finance Board (“CFB”), BENJAMIN could accept campaign contributions only to his senate campaign. As a state campaign, the senate campaign was not eligible for public matching funds available in New York City municipal races. BENJAMIN also gave CC-1 contributor forms to complete, and CC-1 completed them in BENJAMIN’s presence, signing the names of CC-1’s relatives. BENJAMIN reviewed and accepted the forms and contributions, even though he knew that the listed relatives were not in fact funding the contributions.
During the same meeting, BENJAMIN reminded CC-1 of the State Grant for Organization-1 and that BENJAMIN still expected CC-1 to procure numerous small contributions for his Comptroller Campaign. BENJAMIN later reminded CC-1 of his expectations again, including by presenting CC-1 with a novelty check representing the $50,000 at a fundraiser for Organization-1 held just one week before BENJAMIN became eligible to receive contributions for his Comptroller Campaign, and by calling CC-1 shortly thereafter to specify the kinds of contributions he needed.
Between October 2019 and January 2021, CC-1 obtained numerous contributions for BENJAMIN’s Comptroller Campaign, many of which were fraudulent (the “CC-1 Contributions”). BENJAMIN communicated with CC-1 about CC-1’s fundraising efforts during that period. BENJAMIN also communicated with his staff and advisors about CC-1’s fundraising efforts, and specifically described certain contributions as having been procured by CC-1. And BENJAMIN personally met with CC-1 on more than one occasion to receive some of the contributions CC-1 had purportedly collected from others.
Alleged Lies and Deception
Between 2019 up through and including the period of his application for and service as Lieutenant Governor of New York, BENJAMIN and others acting at his direction or on his behalf, engaged in a series of lies and deceptions in order to conceal the bribery scheme and BENJAMIN’s connection to CC-1.
In or about November 2019, the New York State Board of Elections (“BOE”) notified BENJAMIN’s senate campaign that it had failed to file certain forms required to identify owners of certain limited liability companies (“LLCs”) that had made contributions to the Senate Campaign. This included the LLC through which CC-1 had made a $5,000 contribution during the July 8, 2019, meeting. A member of BENJAMIN’s staff sent BENJAMIN an email listing LLCs requiring additional disclosures, specifically identifying the LLC used by CC-1 as being associated with CC-1, and asked BENJAMIN for help obtaining ownership information those LLCs. BENJAMIN responded to that email by asking, “What happens if someone refuses to provide the information?” Ultimately, BENJAMIN’s senate campaign provided the BOE with ownership information about certain LLCs, but not the LLC used by CC-1.
In or about February 2020, the CFB informed BENJAMIN’s Comptroller Campaign that certain of the CC-1 Contributions had been deemed ineligible for matching funds because, among other reasons, they were funded by sequentially-numbered money orders. In response, in or about July 2020, the Comptroller Campaign submitted to the CFB forms indicating that certain of the CC-1 Contributions had been procured by a particular individual (“Individual-1”), even though BENJAMIN knew the contributions had been procured by CC-1.
On or about January 4, 2021, a news outlet published an article raising questions about the legitimacy of certain contributions to BENJAMIN’s Comptroller Campaign, including certain of the CC-1 Contributions. The next day, BENJAMIN’s Comptroller Campaign submitted a misleading letter to the CFB stating there had been no reason to question the legitimacy of the contributions purportedly procured by Individual-1 in light of, among other things, Individual-1’s reputation in the community. At the time the letter was submitted, however, BENJAMIN knew that the CC-1 Contributions had in fact been procured by CC-1, not Individual-1.
On or about August 17, 2021, while being considered to be the next Lieutenant Governor of the State of New York, BENJAMIN submitted responses to an executive appointment questionnaire that contained questions addressing, among other things, BENJAMIN’s relationship with political contributors. Despite BENJAMIN’s efforts to procure $50,000 for Organization-1 and his solicitation of contributions from CC-1, BENJAMIN falsely stated, among other things, that he had never “directly exercised [his] governmental authority (either as a Legislator or Executive official) concerning a matter of a donor [he] directly solicited.” And approximately two hours after submitting his responses to that questionnaire, BENJAMIN called CC-1 for the first time in six months.
* * *
BENJAMIN, 45, of Harlem, New York, is charged with one count of federal program bribery, which carries a maximum sentence of 10 years in prison; one count of honest services wire fraud, which carries a maximum sentence of 20 years in prison; one count of conspiracy to commit those offenses, which carries a maximum sentence of 5 years in prison; and two counts of falsification of records, each of which carries a maximum sentence of 20 years in prison.
The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Williams praised the outstanding investigative work of the FBI and DOI, and thanked the CFB for their assistance in this investigation.
This case is being handled by the Office’s Public Corruption Unit. Assistant United States Attorneys Jarrod L. Schaeffer, Alison Moe, Tara La Morte, and David Abramowicz are in charge of the prosecution.
The charges contained in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Indictment, and the description of the Indictment set forth herein, constitute only allegations, and every fact described should be treated as an allegation. Where specific statements are described herein, they are described in substance and in part.
Nashville Man Sentenced to 15 Years in Federal Prison for Possession of A Stolen Firearm as a Convicted FelonRead the Press Release
NASHVILLE – Lee Allen Mayhew, 45, was sentenced today in U.S. District Court to 15 years in federal prison for possessing a stolen firearm while being a convicted felon, announced U.S. Attorney Mark H. Wildasin for the Middle District of Tennessee.
On February 5, 2018, Mayhew was arrested by officers with the Murfreesboro Police Department after he was found to be a passenger in a car stopped for a traffic violation. After producing identification for another person, Mayhew was arrested for criminal impersonation, and during a subsequent search of the vehicle, officers found a Sig Sauer rifle and ammunition in the trunk, which had previously been stolen in Robertson County, Tennessee. Mayhew later admitted that the rifle was his.
Mayhew pleaded guilty to the charge last month and was found at sentencing to be an armed career criminal, based on four prior convictions for residential burglary. Pursuant to the plea agreement, the 15-year sentence will run concurrently with any sentence received from charges pending in the state of Georgia, where Mayhew was charged in October 2020 with the murder of a 52-year-old woman, after breaking into her home and subsequently stealing her car. At the time of that incident, Mayhew was on pre-trial release from the firearms charge in Tennessee and had failed to appear for a hearing the week before.
Mayhew will be transferred to the State of Georgia at a later date for further proceedings.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms & Explosives, and the Murfreesboro Police Department. Assistant U.S. Attorney Juliet Aldridge prosecuted the case.
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Montgomery County and Florida Women Convicted of Conspiring to Access Company Computers for MoneyRead the Press Release
PHILADELPHIA – United States Attorney Jennifer Arbittier Williams announced that Frances Marie Eddings, 68, of Orlando, FL, and Jude Denis, 54, of Wyncote, PA, were convicted after trial in the Allentown Federal Courthouse of accessing a computer system without authorization for pecuniary gain from a non-profit charity organization.
In September 2019, the defendants were charged with one count of conspiracy, three counts of unauthorized access to a computer, and aiding and abetting, stemming from their scheme to receive a payment of money from the Prostate Cancer Foundation (PCF), Denis’ former employer. In support of that scheme, they accessed internal documents obtained via unauthorized access to the computer system of PCF and threatened to release them to the public. Denis was hired by PCF in August 2014 but left her position shortly thereafter.
Evidence presented at trial showed that on several occasions over the course of several days after Denis left her employment, PCF computers were accessed, and documents were downloaded to her laptop and emailed to Eddings. In a series of emails sent by Eddings to PCF, the defendants demanded a payment of $150,000 in lost wages for Denis, as well as a $37,500 payment for Eddings for acting on Denis’ behalf. In those emails, Eddings threatened to release the documents to the public if their demands were not met. When their demands were ultimately not met, Eddings sent a series of emails to the PCF Board, PCF donors, and members of the media, sharing her previous correspondence and attaching the documents.
“Cyber-intrusion is a threat to all types of businesses, including non-profits,” said U.S. Attorney Williams. “Individuals who take advantage of a company’s vulnerability like these defendants did shows how easily sensitive information can be compromised. However, the defendants didn’t count on how decisively our Office would respond by holding them accountable for their illegal actions.”
“It should go without saying that committing cyber intrusions to settle a score is an incredibly bad idea,” said Jacqueline Maguire, Special Agent in Charge of the FBI’s Philadelphia Division. “Denis wanted payback from the nonprofit for its perceived unfairness and her friend Eddings was on board to help. Their short-sighted scheme has brought serious consequences, as evidenced by these convictions. The FBI is committed to tracking down and holding accountable cyber criminals, whatever their motivation for willfully breaking the law.”
The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorneys Alison Kehner and Kishan Nair.
Money Launderer Previously Extradited from Spain Sentenced to Five Years in PrisonRead the Press Release
BOSTON – A Dominican national was sentenced on Friday, April 8, 2022, in federal court in Boston for his role in a money laundering conspiracy.
Jose Ernesto Pujols, 47, was sentenced by U.S. District Court Judge Patti B. Saris to five years in prison. In July 2021, Pujols pleaded guilty to one count of conspiracy to launder money and one count of money laundering.
In March 2011, investigators identified foreign banks accounts involved in a larger drug and money laundering investigation of targets in the United States and Colombia. Undercover agents communicated with Pujols and arranged a meeting at a restaurant in Woburn to pick up drug proceeds for wiring to these foreign bank accounts. On March 2, 2011, Pujols arrived at the meeting location and provided the undercover agents with approximately $100,000 in drug proceeds.
In May 2011, Pujols was indicted by a federal grand jury in Boston. Pujols was subsequently located in Spain and arrested by Spanish authorities in September 2019. Pujols was held in Spanish custody and extradited to the United States in March 2021.
United States Attorney Rachael S. Rollins and Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration, New England Field Division, made the announcement. Special assistance was provided by the Massachusetts State Police and the Bedford Police Department. Assistant U.S. Attorneys Neil J. Gallagher and Stephen W. Hassink of Rollins’ Criminal Division prosecuted the case.
Mexican Man Sentenced to over 3 Years in Prison for Possession with Intent to Distribute MethamphetamineRead the Press Release
Hattiesburg, Miss. – A Mexican citizen was sentenced to 40 months in federal prison for possession with intent to distribute methamphetamine, announced U.S. Attorney Darren J. LaMarca and Special Agent in Charge David L. Denton of Homeland Security Investigations in New Orleans.
Martin Ruiz-Amayo, 41, was sentenced in U.S. District Court today. In addition to his term of imprisonment, he was ordered to pay $5,100 in fines and special assessment, and to serve 3 years of supervised release after completion of his prison sentence. Additionally, after completion of his prison sentence, Ruiz-Amayo will be subject to removal proceedings by the U.S. Department of Homeland Security
Ruiz-Amayo pleaded guilty and was convicted of the offense on November 4, 2021.
According to court records, on June 3, 2021, the Homeland Security Investigations, Border Enforcement Security Task Force (BEST) and Jones County Sheriff’s Office agents conducted a controlled purchase from Ruiz-Amayo, for approximately one ounce of methamphetamine for $800 in Laurel, Mississippi. Ruiz-Amayo said he could provide additional meth at lower prices and noted the quality of the methamphetamine.
Record checks revealed that Ruiz-Amayo is an alien who is unlawfully present in the United States with a prior removal history. Ruiz-Amayo also has been known as Martin Ruiz.
The case was investigated by Homeland Security Investigations and the Jones County Sheriff’s Department. The case was prosecuted by Assistant U.S. Attorney Stan Harris.
Mexican Man Sentenced for Unlawful Return After RemovalRead the Press Release
Gulfport, Miss. – A Mexican national was sentenced for unlawful return after deportation or removal, announced U.S. Attorney Darren J. LaMarca and Chief Patrol Agent Jason E. Schneider of the U.S. Border Patrol’s New Orleans Sector.
Fernando Hernandez-Zavala, 39, of Mexico, was sentenced to “time served” (effectively 6 months and 7 days). Hernandez-Zavala also was sentenced to one year of supervised release upon release from prison. He is subject to removal proceedings by the U.S. Department of Homeland Security to remove him from the U.S. and return him to his home nation of Mexico. Hernandez-Zavala pleaded guilty and was convicted of this federal offense on January 12, 2022.
According to court documents, Hernandez-Zavala was arrested on October 8, 2021, on Interstate 10 in Harrison County. A Harrison County Sherriff’s Department Interdiction Patrol Deputy conducted a vehicle stop near Mile Marker 29 on Interstate 10 eastbound for speeding.
The passenger in the vehicle was identified as Fernando Hernandez-Zavala, a citizen and national of Mexico with no legal right to enter or remain in the United States. Record checks revealed that he had been lawfully removed from the United States in 2004 and again in 2010.
The case was investigated by the U.S. Border Patrol and the Harrison County Sheriff’s Department.
Assistant U.S. Attorney Stan Harris was the prosecutor for this case.
Massachusetts Man Sentenced for Transporting Child PornographyRead the Press Release
PORTLAND, Maine: A Massachusetts man was sentenced today in federal court for transporting child pornography, U.S. Attorney Darcie N. McElwee announced.
Chief U.S. District Judge Jon D. Levy sentenced Daniel Stasiak, 44, to six years in prison to be followed by seven years of supervised release. Stasiak pleaded guilty on September 23, 2021.
According to court records, while present in Maine, Stasiak sent a video of a minor engaged in sexually explicit conduct over the Kik messaging app. Among the recipients of the video was an undercover law enforcement officer in Winnebago County, Wisconsin. The video depicted a child appearing to be four to six years old.
The FBI and the Winnebago County Sheriff’s Office investigated 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. Led by U.S. Attorneys’ Offices and the Department’s Child Exploitation and Obscenity Section, 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.
To report an incident involving the possession, distribution, receipt, or production of child pornography, file a report with the National Center for Missing & Exploited Children at www.cybertipline.com or 1-800-843-5678. Your report will be forwarded to a law enforcement agency for investigation and action. If you have an emergency that requires an immediate law enforcement response, please call 911 or contact your local police or sheriff’s department.
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Maryland man sentenced for firearms chargeRead the Press Release
MARTINSBURG, WEST VIRGINIA – Alexander Michael Ryan Myers, of Hagerstown, Maryland, was sentenced today to 10 months of incarceration for his role in a firearms trafficking conspiracy, United States Attorney William Ihlenfeld announced.
Myers, 23, pleaded guilty in November 2021 to one count of “Conspiracy.” Myers admitted to working with others to purchase, possess, and transfer firearms to persons who couldn’t legally purchase or possess firearms. The crimes took place in March and April 2021 in Berkeley County and elsewhere.
Assistant U.S. Attorney Lara Omps-Botteicher prosecuted the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated.
U.S. District Judge Gina M. Groh presided.
Maryland man sentenced for firearms chargeRead the Press Release
MARTINSBURG, WEST VIRGINIA – James Andrew Logan, of Dundalk, Maryland, was sentenced today to 24 months of incarceration for his role in a firearms trafficking conspiracy, United States Attorney William Ihlenfeld announced.
Logan, 27, pleaded guilty in November 2021 to one count of “Conspiracy.” Logan admitted to working with others to purchase, possess, and transfer firearms to persons who couldn’t legally purchase or possess firearms. The crimes took place from April 2019 to December 2020 in Berkeley County and elsewhere.
Assistant U.S. Attorney Lara Omps-Botteicher prosecuted the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated.
U.S. District Judge Gina M. Groh presided.
Man, 72, Convicted of Attempted Bank Robbery in AbileneRead the Press Release
A 72 year-old El Paso man was found guilty of attempted bank robbery on Tuesday, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.
After two days of trial and just two hours of deliberation, a federal jury in Lubbock convicted James Earl Green, Jr. of attempted bank robbery.
According to evidence presented at trial, at approximately 7:40 a.m. on Sept. 24, 2019, Mr. Green accosted a First State Bank employee as she was attempting to enter the bank for opening.
Mr. Green held a handgun to the employee’s head and pushed her inside the bank, where he held her for approximately 20 minutes. During that time, surveillance video caught the defendant on camera pacing back and forth with an identifiable limp.
A second bank employee arrived at 7:57 a.m., and a struggle ensued. (Download surveillance footage here.) During the melee, Mr. Green struck the first employee on the head with his handgun. He then fled on foot without obtaining any money, leaving his two duffel bags behind.
An anonymous tipster notified the Abilene Police Department that a gold Cadillac had been parked across the street from the bank the morning before the robbery. Law enforcement then identified the Cadillac – a four door sedan with its front right hub cap cover missing – in surveillance video pulled from the bank’s vicinity. An employee of the City of Abilene narrowed down gold Cadillacs from a list of more than 11,000 to locate a matching gold Cadillac belonging to Mr. Green.
After learning that Mr. Green lived in El Paso, officers reached out to an individual there that knew him, who reviewed the bank surveillance video and noted that the robber in the video walked in a similar manner to Mr. Green, who wore a prosthetic leg. She also shared a photo of Mr. Green’s Cadillac, which was gold and missing its front right hub cap cover.
Meanwhile, the Texas Department of Public Safety’s Crime Lab extracted a DNA profile from the duffel bag, ran it through the FBI’s Combined DNA Index System (CODIS), and found a match to a sample from Mr. Green. Additionally, a member of the FBI’s Cellular Analysis Survey Team obtained historical cell phone data from Mr. Green’s cell phone provider and placed Mr. Green’s cell phone traveling to Abilene from El Paso days before the attempted bank robbery and returning from Abilene to El Paso immediately following the attempted robbery.
Mr. Green now faces up to 20 years in federal prison. His sentencing has been set for July 21.
The Abilene Police Department, the Federal Bureau of Investigation’s Dallas and El Paso Field Offices, and the Texas Department of Public Safety’s Crime Laboratory conducted the investigation. Assistant U.S. Attorneys Callie Woolam and Ryan Redd tried the case. U.S. District Judge James Wesley Hendrix presided over the trial.
Man Who Sold Deadly Fentanyl Sentenced to 5 Years in Federal PrisonRead the Press Release
Leonard C Boyle, United States Attorney for the District of Connecticut, announced that CHRISTOPHER DUBICKI, 37, formerly of Sprague, was sentenced today by U.S. District Judge Robert N. Chatigny in Hartford to 60 months of imprisonment, followed by four years of supervised release, for distributing fentanyl.
According to court documents and statements made in court, the FBI’s Safe Streets Task Force and the Norwich Police Department launched an investigation after several fatal and non-fatal overdoses occurred in a short period of time in eastern Connecticut. Investigators determined that, beginning at least as early as January 2017 and continuing to July 2018, Michael Nieves worked with Juan Reyes to supply heroin and fentanyl to other distributors, including individuals who regularly traveled from eastern Connecticut to Hartford to purchase the drugs. Those individuals then sold the drug to customers in the Norwich and New London areas.
On July 5, 2017, Norwich Police officers responded to a residence on the report of an overdose. The victim, a 34-year-old male, was transported to the hospital where he died. The Office of the Chief Medical Examiner subsequently determined the victim’s cause of death to be “acute fentanyl intoxication.” The investigation revealed that Dubicki sold the fentanyl to the victim after previously purchasing it from Nieves and Reyes.
As the investigation continued, investigators made multiple controlled purchases of fentanyl from Dubicki. On February 7, 2018, a court authorized search of Dubicki’s residence revealed approximately 650 glassine bags of fentanyl.
Dubicki has been detained since his arrest on May 7, 2018. On August 12, 2019, he pleaded guilty to fentanyl, heroin and cocaine distribution charges.
Investigators connected six other overdoses, three fatal and three non-fatal, to drugs that were supplied by Nieves and Reyes. They both pleaded guilty to federal charges.
On June 9, 2021, Reyes was sentenced to 151 months in prison and, on February 24, 2022, Nieves was sentenced to 168 months in prison.
This investigation was conducted by the FBI’s Safe Streets Task Force and the Norwich Police Department. The case was prosecuted by Assistant U.S. Attorney Patricia Stolfi Collins with the assistance of the State’s Attorney for the New London Judicial District.
Louisiana Man Sentenced to Three Years Imprisonment for Dog Fighting VenturesRead the Press Release
WASHINGTON – A Louisiana man was sentenced today to three years in prison, three years of supervised release and a $1000 fine for possession of an animal in an animal fighting venture.
Clay Turner, 61, of Loranger, pleaded guilty to possession of an animal for use in an animal fighting venture on June 30, 2021. According to court documents, Turner possessed and trained dogs for the purpose of having them participate in animal fighting ventures. On telephone calls obtained via court-authorized wiretaps, Turner and others discussed gambling on dog fights, arranging and participating in dog fights, sponsoring and exhibiting dogs in dog fights, training and housing dogs for the purposes of dog fighting, commerce in and transport of fighting dogs, and the promotion of dog fights.
In October 2017, a federal law enforcement team consisting of agents from the Department of Agriculture Office of Inspector General (USDA-OIG), the FBI, the U.S. Marshals Service and other agencies executed a search warrant on Turner’s residence in Loranger. During the search, 33 dogs were found on the property, many of which had injuries, scarring and fresh wounds. Law enforcement also discovered a large collection of dog fighting paraphernalia, including:
- a water tank equipped to force dogs to swim to condition them for fighting;
- an electrified prod used in conjunction with the water tank;
- two treadmills equipped to force dogs to run to condition them for fighting;
- ledgers containing the weights and prices of dogs;
- “break sticks” and “flirt poles,” training equipment intended to enhance dogs’ jaw strength;
- pedigrees for the fighting dogs Turner bred; and
- photographs of dogs in inhumane conditions.
“Dog fighting is a particularly cruel form of animal abuse,” said Assistant Attorney General Todd Kim for the Justice Department’s Environment and Natural Resources Division. “Turner bred dogs solely to abuse them, through inhumane training methods and violent fights that left them scarred, severely injured, or dead. These dogs deserved better. As this prosecution demonstrates, those who engage in this abhorrent conduct will be brought to justice.”
“This case lifts the veil on the brutal realities associated with this heinous activity,” said U.S. Attorney Duane A. Evans of the Eastern District of Louisiana. “This federal crime exploits animals for the sake of human entertainment and ill-gotten financial gains. Collectively, local, state and federal law enforcement partners are actively engaged in ending this criminal industry by holding accountable perpetrators who engage in dog fighting and rescuing victimized dogs from this appalling pastime.”
“The provisions of the Animal Welfare Act were designed to protect animals from being used in illegal fighting ventures, which often entail other forms of criminal activity involving drugs, firearms, and gambling,” said Special Agent-in-Charge, Dax Roberson of USDA-OIG. Together with the Department of Justice, animal fighting is an investigative priority for USDA-OIG, and we will work with our law enforcement partners to investigate and assist in the criminal prosecution of those who participate in animal fighting ventures.”
“Animal cruelty is a heinous crime that deserves our ultimate condemnation and serious legal consequences for those who engage in it for ‘sport’ and/or profit,” said Special Agent in Charge Douglas A. Williams Jr. of the FBI New Orleans Field Division. “Today’s sentencing should serveas a reminder to those like Mr. Clay Turner who commit such criminal activity, that they will be held accountable. For their outstanding cooperation and great work, we thank our partners at the U.S. Attorney’s Office Eastern District of Louisiana, the Department of Agriculture-Office of Inspector General, and the Environment and Natural Resources Division’s Environmental Crimes Section in the criminal prosecution of those who participated in animal fighting ventures.”
Trial Attorneys Matthew D. Evans, Christopher Hale and former Senior Trial Attorney Jennifer L. Blackwell of the Environment and Natural Resources Division’s Environmental Crimes Section, and Assistant U.S. Attorney Jonathan Shih for the Eastern District of Louisiana prosecuted the case.
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Louisiana Man Sentenced for Three Years’ Imprisonment for Dog Fighting VenturesRead the Press Release
A Louisiana man was sentenced today to three years in prison, three years of supervised release and a $1,000 fine for possession of an animal in an animal fighting venture.
Clay Turner, 61, of Loranger, pleaded guilty to possession of an animal for use in an animal fighting venture on June 30, 2021. According to court documents, Turner possessed and trained dogs for the purpose of having them participate in animal fighting ventures. On telephone calls obtained via court-authorized wiretaps, Turner and others discussed gambling on dog fights, arranging and participating in dog fights, sponsoring and exhibiting dogs in dog fights, training and housing dogs for the purposes of dog fighting, commerce in and transport of fighting dogs and the promotion of dog fights.
In October 2017, a federal law enforcement team consisting of agents from the U.S. Department of Agriculture Office of Inspector General (USDA-OIG), the FBI, the U.S. Marshals Service and other agencies executed a search warrant on Turner’s residence in Loranger. During the search, 33 dogs were found on the property, many of which had injuries, scarring and fresh wounds. Law enforcement also discovered a large collection of dog fighting paraphernalia, including:
- a water tank equipped to force dogs to swim to condition them for fighting;
- an electrified prod used in conjunction with the water tank;
- two treadmills equipped to force dogs to run to condition them for fighting;
- ledgers containing the weights and prices of dogs;
- “break sticks” and “flirt poles,” training equipment intended to enhance dogs’ jaw strength;
- pedigrees for the fighting dogs Turner bred; and
- photographs of dogs in inhumane conditions.
“Dog fighting is a particularly cruel form of animal abuse,” said Assistant Attorney General Todd Kim for the Justice Department’s Environment and Natural Resources Division. “Turner bred dogs solely to abuse them, through inhumane training methods and violent fights that left them scarred, severely injured or dead. These dogs deserved better. As this prosecution demonstrates, those who engage in this abhorrent conduct will be brought to justice.”
“This case lifts the veil on the brutal realities associated with this heinous activity,” said U.S. Attorney Duane A. Evans of the Eastern District of Louisiana. “This federal crime exploits animals for the sake of human entertainment and ill-gotten financial gains. Collectively, local, state and federal law enforcement partners are actively engaged in ending this criminal industry by holding accountable perpetrators who engage in dog fighting and rescuing victimized dogs from this appalling pastime.”
“The provisions of the Animal Welfare Act were designed to protect animals from being used in illegal fighting ventures, which often entail other forms of criminal activity involving drugs, firearms and gambling,” said Special Agent in Charge Dax Roberson of USDA-OIG. “Together with the Department of Justice, animal fighting is an investigative priority for USDA-OIG, and we will work with our law enforcement partners to investigate and assist in the criminal prosecution of those who participate in animal fighting ventures.”
“Animal cruelty is a heinous crime that deserves our ultimate condemnation and serious legal consequences for those who engage in it for ‘sport’ and/or profit,” said Special Agent in Charge Douglas A. Williams Jr. of the FBI New Orleans Field Division. “Today’s sentencing should serveas a reminder to those like Mr. Clay Turner who commit such criminal activity, that they will be held accountable. For their outstanding cooperation and great work, we thank our partners at the U.S. Attorney’s Office Eastern District of Louisiana, the USDA-OIG, and the Environment and Natural Resources Division’s Environmental Crimes Section in the criminal prosecution of those who participated in animal fighting ventures.”
Trial Attorneys Matthew D. Evans, Christopher Hale and former Senior Trial Attorney Jennifer L. Blackwell of the Environment and Natural Resources Division’s Environmental Crimes Section and Assistant U.S. Attorney Jonathan Shih for the Eastern District of Louisiana prosecuted the case.
Leader of firearms ring convictedRead the Press Release
HOUSTON - The 17th individual involved in a firearms trafficking cell has entered a guilty plea to eight charges related to the scheme, announced U.S. Attorney Jennifer B. Lowery.
Gustavo Gomez-Valenzuela, 49, a Mexican citizen who illegally resided in Houston, admitted to aiding and abetting a false statement on a firearms purchasing form, alien in possession of a firearm, felon in possession of a firearm, conspiracy to possess with intent to distribute a controlled substance, aiding and abetting smuggling goods from the United States, international money laundering conspiracy and illegal reentry after removal.
Gomez-Valenzuela was the leader of a Houston-based gun trafficking cell that was sending firearms to Mexico. As part of his plea, he admitted to providing funds to purchase hundreds of firearms and thousands of rounds of ammunition, smuggling both firearms and ammunition to Mexico, possessing firearms and selling kilogram quantities of meth.
He received the firearms from other individuals in the organization who purchased the firearms from Khalid Abdulaziz, the owner and manager of Zeroed In Armory. While acting in the capacity of a federal firearms licensee in Houston, Abdulaziz sold the majority of the firearms to others charged in this case. Those people have admitted to working with Abdulaziz and making false statements in the purchase of firearms, thereby illegally purchasing them.
Abdulaziz previously pleaded guilty to six counts of aiding and abetting a false statement on ATF Form 4473.
As a result of the scheme, approximately 500 firearms were purchased and ultimately trafficked to transnational criminal organizations in Mexico.
Assistant U.S. Attorneys Jennifer Stabe and Lisa M. Collins prosecuted the case.
The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Drug Enforcement Administration conducted the Organized Crime Drug Enforcement Task Force (OCDETF) operation with the assistance of Homeland Security Investigations, IRS – Criminal Investigation, Houston Police Department and the Harris County Sheriff’s Office. OCDETF identifies, disrupts and dismantles the highest-level drug traffickers, money launderers, gangs and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state and local law enforcement agencies against criminal networks. Additional information about the OCDETF Program can be found on the Department of Justice’s OCDETF webpage.
Leader of Cellphone Fraud and Identity Theft Scheme Sentenced to More Than Seven Years in PrisonRead the Press Release
Damian Williams, the United States Attorney for the Southern District of New York, announced that HENRY PEREZ was sentenced today to more than seven years in prison for leading a multi-year cellphone account takeover fraud and identity theft conspiracy. PEREZ impersonated legitimate cellphone accountholders in order to fraudulently obtain smartphones and electronic devices that he charged to compromised accounts. The fraud scheme also caused more than 300 victims across the United States to lose cellphone service for a period of time; during the time that PEREZ controlled victims’ phone numbers, “inbound” text messages intended for victims were instead received by PEREZ. PEREZ’s sentence was imposed by U.S. District Judge Richard M. Berman, before whom PEREZ previously pled guilty to conspiracy to commit wire fraud.
U.S. Attorney Damian Williams said: “Henry Perez led a sophisticated cellphone fraud and identity theft scheme. He impersonated victims, changed victims’ account information so victims would not receive fraud alerts, charged purchases to victims’ accounts, and deprived victims of cellphone service. Today’s sentence sends a clear message: Those who exploit victims’ identifying information for financial gain will pay a heavy price.”
According to the allegations in the Indictment, public court filings, and statements made in court:
From June 2017 through December 2019, PEREZ was the leader of a criminal fraud ring that committed cellphone account takeover fraud and identity theft across the United States, including in the Southern District of New York. The scheme’s primary objective was to obtain new, valuable electronic devices, including iPhones, and charge these purchases to victims’ accounts, without the knowledge or consent of the victim accountholders. Over the course of the conspiracy, participants in the scheme attempted to fraudulently obtain more than $1 million worth of devices and, in fact, fraudulently obtained more than $530,000 worth of such devices (e.g., iPhones, iPads, and AirPods), by charging purchases to victims’ accounts.
To perpetrate the scheme, members of the conspiracy, including PEREZ, used stolen identity information to impersonate victims who had cellphone accounts with a particular cellphone service provider (“Provider-1”). Members of the conspiracy then called customer service representatives of Provider-1 and used social engineering techniques to take over accounts by making various misrepresentations, including impersonating accountholders and expressing a purported need to regain access to their accounts. Through these misrepresentations, conspirators were able to gain unauthorized access to, and control of, accounts belonging to victim accountholders. Once they gained access, members of the conspiracy made various unauthorized changes to victim accounts, so that fraud alerts and emails relating to account changes were sent to a conspiracy member, rather than to the legitimate accountholders. Participants in the conspiracy then purchased new electronic devices, which they charged to victim accounts, without the knowledge or consent of the victims.
In many instances, conspirators arranged for the fraudulently ordered devices to be shipped to more than 50 different addresses. In other instances, members of the scheme, including PEREZ, personally entered stores operated by Provider-1 to pick up fraudulently obtained devices. In total, participants in the conspiracy conducted in-store pickups of fraudulently obtained devices in at least 10 different states.
Once they had successfully exploited a particular victim’s account, members of the conspiracy typically relinquished control of that account, and moved on to exploiting other victim accounts. During the period in which the conspiracy compromised, and retained control of, a particular victim’s cellphone number, that victim typically lost cellphone service. In total, the scheme caused more than 300 victims across the United States to lose cellphone service for a period of time. During the time that a victim lost cellphone service, their phone line remained in service—but it was controlled by PEREZ’s conspiracy, rather than the victim; thus, during that time, “inbound” text messages intended for that victim were instead received by PEREZ.
PEREZ was integrally involved in all aspects of the scheme, including using victims’ personal identifying information to dupe Provider-1; gaining unauthorized access to victim accounts; making unauthorized changes to victim accounts; receiving fraudulently obtained devices; and recruiting, directing, and paying a subordinate, including supplying that subordinate with victim information. In addition, PEREZ gained access to victims’ sensitive information, including their addresses, certain financial information, and in some cases, their relatives’ names.
In addition to his prison sentence of 88 months, PEREZ, 34, of Fort Lee, New Jersey, was sentenced to three years of supervised release. He was also ordered to pay restitution of $539,654.96 and forfeiture of $532,374.96.
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Mr. Williams praised the New York Office of Homeland Security Investigations and its El Dorado Task Force for its outstanding work on this case.
This matter is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorney Michael D. Neff is in charge of the prosecution.
Landlord Pays $15,000 to Resolve Allegations that It Collected Excess Rent from a TenantRead the Press Release
SAN ANTONIO – 2011 Bandera Road, LLC agreed to pay the United States $15,000 to resolve allegations that it violated the False Claims Act, 31 U.S.C. §§ 3729-3733, by collecting excess rent from a tenant in the U.S. Department of Housing and Urban Development’s (HUD) federal Housing Choice Voucher Program, commonly referred to as “Section 8.” Section 8 is a program to assist low-income families, the elderly and the disabled in securing decent, safe, and sanitary housing in the private market. Through this program, HUD provides funding by vouchers administered by local public housing agencies. HUD pays the housing subsidy directly to the landlord, which may cover all or a portion of a tenant’s monthly rent. As a condition of receiving the housing subsidy, the landlord contractually agrees not to charge the tenant rent that exceeds the amount set by the public housing agency.
2011 Bandera Road leased property to certain tenants participating in the Section 8 program. This settlement resolves allegations that from November 2017 through January 2019, the company violated the False Claims Act by knowingly requiring one of those tenants to pay rent that exceeded what was contractually allowed.
United States Attorney Ashley C. Hoff stated, “The Section 8 program helps Americans in need of affordable quality housing. That purpose is undermined when a program participant overcharges a beneficiary of the program.”
“Those who seek out opportunities to prey on American families who rely on HUD programs for safe and affordable housing will be pursued and held accountable,” said Special Agent-in-Charge Bertrand Nelson with the HUD Office of Inspector General (OIG). “HUD OIG is committed to working with its law enforcement partners to fully investigate allegations of fraud, waste, abuse and mismanagement of HUD programs and protect American taxpayer dollars that fund them.”
The settlement resolves allegations contained in a lawsuit filed by a former tenant under the qui tam or whistleblower provisions of the False Claims Act. The False Claims Act permits private parties to file suit on behalf of the United States and share in any recovery.
The U.S. Department of Housing and Urban Development, Office of Inspector General, investigated this matter along with Assistant United States Attorney John Deck from the U.S. Attorney’s Office for the Western District of Texas. The qui tam case is docketed as United States ex rel. Elissa L. White and Elissa L. White, individually, v. 2011 Bandera Road, LLC, Cause No. 5:20-CV-488, (W.D. Tex.).
The claims resolved by the settlement are allegations only and there has been no determination of liability.
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Judge sentences St. Louis man to more than 10 years in federal prison for bank fraud in conjunction with the Payment Protection Program (PPP)Read the Press Release
ST. LOUIS – Robert Williams, age 58, of St. Louis, Missouri, appeared before United States District Court Judge Matthew T. Schelp on today’s date. Based on a previous plea of guilty, Williams was sentenced to 125 months in federal prison for numerous counts of bank fraud related to Payment Protection Program (“PPP”) loans.
The United States Small Business Administration (“SBA”) is an executive-branch agency of the United States government that provides support to entrepreneurs and small businesses. The Coronavirus Aid, Relief, and Economic Security (“CARES”) Act is a federal law that was enacted in or around March 2020 to provide emergency financial assistance to the millions of Americans suffering the economic impact caused by the COVID-19 pandemic.
One source of relief provided for in the CARES Act is the authorization of forgivable loans to small businesses for job retention and certain other expenses, through the Paycheck Protection Program (PPP). The purpose of loans issued under the PPP was to enable small businesses suffering from the economic downturn to continue to pay salary or wages to their employees.
To obtain a PPP loan, a qualifying business is required to submit a PPP loan application, signed by an authorized representative of the business. The PPP loan application requires the business to acknowledge the program rules and make certain affirmative certifications to obtain the PPP loan.
According to court documents, Williams obtained federal loans provided through the CARES Act that resulted in a loss of up to approximately $2.7 million. Williams applied for these loans at Midwest Regional Bank, PNC Bank and submitted false information to receive funding.
The investigation included a review of numerous PPP loan applications and financial accounts during the summer of 2020. Williams completed and submitted approximately thirty different PPP loan applications that contained materially false statements and false supporting documents related to the ownership of a business and the business’ payroll including the number of employees and monthly payroll expenses.
Investigators also determined that Williams did not use the PPP loan funds for any appropriate business expenses but used funds for his own personal benefit including the purchase of vehicles such as a Maserati Levante and a Jaguar, F-Pace. Williams also assisted several other businesses in brokering and submitting fraudulent PPP loan applications. During the investigation the FBI seized approximately $466,000 and vehicles. Williams has also agreed to an order of restitution for $1,231,491.
This case was investigated by the U.S. Small Business Administration and FDIC of the Office of Inspector General, and the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorney Edward Dowd III.
Johnstown Man Pleads Guilty to Distributing NarcoticsRead the Press Release
JOHNSTOWN, Pa. – A former resident of Johnstown, PA pleaded guilty in federal court to charges of violating federal narcotics laws, United States Attorney Cindy K. Chung announced today.
Troy Jamal Jones, 36, of Johnstown, PA, pleaded guilty to Counts One and Two of the Indictment before Senior United States District Judge Kim R. Gibson.
In connection with the guilty plea, on or about August 21, 2019, Jones did distribute a quantity of a mixture and substance containing a detectable amount of cocaine base. Further, on or about August 27, 2019, Jones did distribute a quantity of a mixture and substance containing a detectable amount of cocaine base, heroin, and fentanyl.
Judge Gibson scheduled sentencing for Aug. 23, 2022. The law provides for a maximum sentence of 40 years in prison, a fine of $2,000,000, 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.
Assistant United States Attorney Maureen Sheehan-Balchon is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation conducted the investigation that led to the prosecution of Jones.
Jemez Pueblo man sentenced to five years in federal prison for child sexual abuse in Indian CountryRead the Press Release
ALBUQUERQUE, N.M. – Alan Madalena, 33, of Rio Rancho, New Mexico, and an enrolled member of the Pueblo of Jemez, was sentenced in federal court today to five years in prison for sexual abuse of a minor in Indian Country. Madalena pleaded guilty on Oct. 7, 2021.
A federal grand jury indicted Madalena on Dec. 2, 2020. According to the plea and other court records, on four occasions between Aug. 1, 2020, and Oct. 15, 2020, Madalena sexually abuse the victim in his residence on the Pueblo of Jemez. The victim, who is an enrolled member of the Pueblo of Jemez, was 15 years old at the time. Madalena knew the victim’s age when he committed the sexual abuse.
Upon his release from prison, Madalena will be subject to five years of supervised release and must register as a sex offender.
The FBI Albuquerque Field Office investigated this case with assistance from the Jemez Pueblo Police Department. Assistant United States Attorney Elisa Dimas prosecuted the case.
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Husband and Wife Arrested for Export Control Violations, Wire Fraud, Tax Fraud and Making False StatementsRead the Press Release
A Texas man and woman were arrested today in Helotes on criminal charges related to the husband’s involvement in alleged export violations and both of their alleged involvement in a scheme to defraud a research and development company (R&D Company) that provided services to industrial and government clients in the United States and abroad.
Xiaojian Tao, 63, is charged with one count of illegal export of defense articles; one count of unlawful export of commerce-controlled goods; and one count of making a false statement with regards to the Export Control Reform Act (ECRA). Tao allegedly exported items to China without having obtained a required export license from either the Department of State or the Department of Commerce.
Tao and Yu Lang, aka Laura Long, 63, are both charged with one count of conspiracy to commit wire fraud and nine counts of wire fraud. According to court documents, from 1997 to the present, Tao and Lang owned and operated Tyletech, aka Tylex Tech LLC and Tyle Tech, a company that provides engineering consulting services. From 1994 to March 2020 Tao worked for the R&D Company that directly competed with Tyletech. Although Tao certified that each year he would notify the R&D Company of any conflicts of interest and follow Standards of Conduct, Tao and Lang hid Tao’s role in Tyletech, instead funneling business from the R&D Company to Tyletech.
Further, from 2016 to 2020, Tao and Lang allegedly filed false income tax returns and are both charged with one count of conspiracy to defraud the United States and five counts of filing false tax returns. Tao also is charged with one count of making a false statement and Lang is charged with two counts of making a false statement.
If convicted, Tao faces a maximum of 20 years in prison on each of the export counts and the false ECRA statement. Tao and Lang face a maximum 20 years in prison on each of the wire fraud counts; five years in prison on each of the false statement counts and the defrauding the U.S. count; and three years in prison on each of the false tax return counts. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division, U.S. Attorney Ashley C. Hoff for the Western District of Texas; Acting Special Agent in Charge Jason Hudson for the FBI’s San Antonio Field Office; Special Agent in Charge Ramsey E. Covington of the IRS – Criminal Investigation (IRS-CI); and Special Agent in Charge Trey McClish of the Department of Commerce, Bureau of Industry and Security – Office of Export Enforcement’s Dallas Field Office made the announcement.
The FBI; IRS-CI; and the Department of Commerce, Bureau of Industry and Security, along with assistance from U.S. Customs and Border Protection, are investigating the case.
Assistant U.S. Attorneys Mark T. Roomberg and William R. Harris for the Western District of Texas are prosecuting the case.
An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Houstonian sent to prison for sexually exploiting young relativeRead the Press Release
HOUSTON – A 36-year-old man has been ordered to prison for production and distribution of child pornography, announced U.S. Attorney Jennifer B. Lowery.
Richard Reyes Trigo pleaded guilty Sept. 22, 2021.
Today, U.S. District Judge Jeffrey Brown sentenced Trigo to 360 and 240 months for the production and distribution convictions, respectively. They will run concurrently for a total 30-year-term of imprisonment. At the hearing, the court also heard additional information that detailed the serious and damaging nature of the offense.
In handing down the prison terms, the court noted “the seriousness of the defendant’s actions.” Trigo was further ordered to pay $3000 in restitution to the victims and will serve 10 years on supervised release following completion of his prison term. During that time, he will have to comply with numerous requirements designed to restrict his access to children and the internet. Trigo will also be ordered to register as a sex offender.
From July 13-14, 2020, Trigo had been communicating with someone he believed was a person with similar interest in child pornography. Trigo continued to engage in conversations via Kik – a site individuals with a sexual interest in children often frequent.
During this time, Trigo accessed and interacted in a social media forum that contained terms commonly associated with the sexual exploitation of children. In it, he admitted he was sexually active with his two-year-old minor female relative and had performed sexual acts on her. Trigo later sent four sexually-explicit images of the minor, some of which focused on her private area.
Trigo also claimed to be sexually active with an eight-year-old minor relative.
Trigo has been in custody since being determined a danger to the community and a flight risk. He will remain there pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The FBI conducted the investigation.
Assistant U.S. Attorneys Sherin Daniel and Sherri L. Zack prosecuted the case, which was brought as part of Project Safe Childhood (PSC), a nationwide initiative the Department of Justice (DOJ) launched in May 2006 to combat the growing epidemic of child sexual exploitation and abuse. U.S. Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section leads PSC, which marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children and identifies and rescues victims. For more information about PSC, please visit DOJ’s PSC page. For more information about internet safety education, please visit the resources link on that page.
Helotes Husband and Wife Arrested for Export Control Violations and Alleged Fraud SchemeRead the Press Release
SAN ANTONIO – A Helotes man and woman were arrested today in Helotes on criminal charges related to the husband’s involvement in alleged export violations and both of their alleged involvement in a scheme to defraud a research and development company (R&D Company) that provided services to industrial and government clients in the United States and abroad.
Xiaojian Tao, 63, is charged with one count of illegal export of defense articles; one count of unlawful export of commerce-controlled goods; and one count of making a false statement with regards to the Export Control Reform Act (ECRA). Tao allegedly exported items to China without having obtained a required export license from either the Department of State or the Department of Commerce.
Tao and Yu Lang, aka Laura Long, 63, are both charged with one count of conspiracy to commit wire fraud and nine counts of wire fraud. According to court documents, from 1997 to the present, Tao and Lang owned and operated Tyletech, aka Tylex Tech LLC and Tyle Tech, a company that provides engineering consulting services. From 1994 to March 2020 Tao worked for the R&D Company that directly competed with Tyletech. Although Tao certified that each year he would notify the R&D Company of any conflicts of interest and follow Standards of Conduct, Tao and Lang hid Tao’s role in Tyletech, instead funneling business from the R&D Company to Tyletech.
Further, from 2016 to 2020, Tao and Lang allegedly filed false income tax returns and are both charged with one count of conspiracy to defraud the United States and five counts of filing false tax returns. Tao also is charged with one count of making a false statement and Lang is charged with two counts of making a false statement.
If convicted, Tao faces a maximum of 20 years in prison on each of the export counts and the false ECRA statement. Tao and Lang face a maximum 20 years in prison on each of the wire fraud counts; five years in prison on each of the false statement counts and the defrauding the U.S. count; and three years in prison on each of the false tax return counts. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
U.S. Attorney Ashley C. Hoff of the Western District of Texas; FBI Acting Special Agent in Charge Jason Hudson; Internal Revenue Service – Criminal Investigations (IRS-CI) Special Agent in Charge Ramsey E. Covington; and Special Agent in Charge Trey McClish, U.S. Department of Commerce, Bureau of Industry and Security – Office of Export Enforcement’s Dallas Field Office made the announcement.
The FBI; IRS-CI; and the Department of Commerce, Bureau of Industry and Security, along with assistance from U.S. Customs and Border Protection, are investigating the case.
Assistant U.S. Attorneys Mark T. Roomberg and William R. Harris are prosecuting the case.
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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Hattiesburg Man Sentenced to 7 Years in Prison for Hobbs Act RobberyRead the Press Release
Gulfport, Miss. – A Hattiesburg man was sentenced to 84 months in federal prison for using actual force or violence to steal a firearm from Academy Sports + Outdoors, announced U.S. Attorney Darren J. LaMarca and Special Agent in Charge Brad L. Byerley of the Drug Enforcement Administration.
According to information presented to the Court, on November 6, 2021, Cody Jerome Cooley, 23, visited Academy Sports + Outdoors in Gulfport. Cooley approached the gun counter and asked to see one of the handguns, a Springfield Armory XDM Elite. The clerk gave Cooley the firearm to examine. Cooley later motioned towards another handgun in the display case. When the clerk turned his head to look at the gun, Cooley looked both ways, struck the clerk in the face with the Springfield Armory handgun, and fled from the store. This was all captured on surveillance footage.
After he fled from the store with the stolen handgun, armed civilians apprehended Cooley in a nearby restaurant parking lot. Post Miranda, Cooley admitted to taking the gun and striking the clerk. The clerk that was struck by Cooley had to receive medical care for his injuries.
Cooley pled guilty on January 11, 2022, to unlawfully obstructing, delaying, and affecting interstate commerce by robbery.
“The United States Attorney’s Office along with its federal, state and local partners is dedicated to prosecuting those who commit violent crimes in our communities. In this case, justice was swift. The residents of Gulfport deserve no less,” said United States Attorney Darren J. LaMarca.
Gulfport Police Deputy Chief Craig Petersen stated: “We at the Gulfport Police Department are committed to reducing gun violence in our city. Because of the partnerships with the Drug Enforcement Agency and the U.S. Attorney’s Office, we successfully took a violent individual off the streets who could have participated in callous acts with a stolen firearm in our community. Continued efforts such as the Project Safe Neighborhoods Initiative are essential in making Gulfport a safer place to live and work.”
The Drug Enforcement Administration and the Gulfport Police Department investigated the case.
Assistant U.S. Attorney Jonathan Buckner prosecuted the case.
This case was prosecuted as part of the joint federal, state, and local Project Safe Neighborhoods (PSN) Program, the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
Greenbush Man Sentenced for Possessing Unregistered Short-Barreled ShotgunRead the Press Release
BANGOR, Maine: A Greenbush man was sentenced today in federal court for possessing an unregistered firearm, U.S. Attorney Darcie N. McElwee announced.
U.S. District Judge Lance E. Walker sentenced Lawrence Shirland, 52, to time served and two years of supervised release. Shirland pleaded guilty on September 15, 2021.
According to court records, on November 10, 2019, Shirland was involved in an altercation at his home in Greenbush during which he fired a warning shot from a sawed-off shotgun. The shot hit a truck windshield. When police arrived, Shirland admitted that he had fired the shotgun and provided it to officers. He explained that he had modified the shotgun himself. Specifically, he cut the barrel with a hack saw, cut and sanded the stock, and wrapped it in tape.
Shirland’s shotgun was not registered to him in the National Firearms Registration and Transfer Record (NFRTR). Federal law prohibits the possession of a weapon made from a shotgun if the modified weapon has a barrel less than 18 inches in length or an overall length of less than 26 inches unless that weapon is registered to the possessor in the NFRTR.
The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Penobscot County Sheriff’s Office investigated the case as part of the Department of Justice’s Project Safe Neighborhoods initiative.
Project Safe Neighborhoods: Project Safe Neighborhoods (PSN) is a nationwide initiative that brings together federal, state, local and tribal law enforcement officials, prosecutors, community leaders and other stakeholders to identify the most pressing violent crime problems in a community and develop comprehensive solutions to address them. PSN is coordinated by the U.S. Attorneys’ Offices in the 94 federal judicial districts throughout the 50 states and U.S. territories. PSN is customized to account for local violent crime problems and resources. Across all districts, PSN follows four key design elements of successful violent crime reduction initiatives: community engagement, prevention and intervention, focused and strategic enforcement, and accountability.
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Former U.S. Postal Service Employee in Chicago Charged with Stealing Stimulus Checks from the MailRead the Press Release
CHICAGO — A former U.S. Postal Service employee in Chicago has been indicted on federal charges for allegedly stealing government stimulus checks from the mail.
OLIVIA L. BRYANT, 33, of Chicago, is charged with three counts of theft from the U.S. mail. Bryant pleaded not guilty to the charges during her arraignment Monday in federal court in Chicago. A status hearing is set for May 13, 2022, at 1:00 p.m., before U.S. District Judge John Robert Blakey.
The indictment was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Andre Martin, Special Agent-in-Charge of the Central Area Field Office of the U.S. Postal Service Office of Inspector General; and J. Russell George, Inspector General of the Treasury Department Inspector General for Tax Administration (TIGTA).
The indictment accuses Bryant of stealing three pieces of mail from her route in Chicago in March of last year. Special Assistant U.S. Attorney Malgorzata Tracz Kozaka advised the Court during arraignment that the stolen mail contained government stimulus checks.
The public is reminded that an indictment is not evidence of guilt. The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Each count in the indictment is punishable by a maximum sentence of five years in federal prison. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.
Former U.S. Department of Homeland Security Official Agrees to Pay $10,000 to Resolve Conflict-of-Interest and False Claims Act AllegationsRead the Press Release
Kenneth J. Buck, Ph.D., the former Executive Director of the Office of Management Integration at the Department of Homeland Security (DHS), has agreed to pay $10,000 to resolve allegations that he violated conflict-of-interest rules in connection with a DHS contract following his departure from the agency in 2016. The settlement, which is based on his ability to pay, also resolves allegations that Buck violated the False Claims Act by submitting, or causing others to submit, false invoices to DHS to conceal his involvement with the contract following his departure from DHS.
Among other things, the Ethics Reform Act of 1989 imposes post-employment restrictions on certain federal officials, including a mandatory one-year “cooling off period” during which former officials are prohibited from communicating directly with their former agency on behalf of another party with the intent to influence agency action. The settlement announced today resolves allegations that Buck violated this rule by communicating directly with a now-former DHS official with the intent to influence agency action regarding a DHS contract with Intelligent Fiscal Optimal Solutions LLC (iFOS), under which Buck was engaged as a subcontractor. According to the government’s allegations, Buck informed a now-former DHS official that he planned to leave DHS and accept an engagement with iFOS, and less than one week later that other DHS official selected iFOS for a no-bid contract. The government alleged that, during his one-year cooling off period, Buck had extensive communications with the DHS official on behalf of iFOS, which Buck and the other DHS official sought to conceal. Finally, the government alleged that Buck and iFOS violated the False Claims Act by submitting false invoices to DHS in which work performed by Buck was billed under the name of another iFOS employee, despite the fact that Buck had not completed a mandatory background investigation required for all personnel who worked on the DHS contract.
“The federal government’s conflict-of-interest rules are essential to ensuring that the federal government’s operations, including the award of contracts, are conducted fairly and free of undue influence,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “The department will hold accountable those who violate these important safeguards, whether they are current or former federal government employees.”
“We appreciate our partnership with the Department of Justice,” said Inspector General Dr. Joseph V. Cuffari of DHS. “This settlement sends a clear message that corruption in the ranks at DHS will not be tolerated.”
The resolution obtained in this matter was the result of a coordinated effort between the Civil Division’s Commercial Litigation Branch, Fraud Section, and the DHS Office of Inspector General’s Major Fraud and Corruption Unit. The matter was handled by Senior Trial Counsel Alicia J. Bentley of the Civil Division, with substantial investigative assistance from Special Agent Asher Shapiro of DHS-OIG.
The claims resolved by the settlement are allegations only and there has been no determination of liability.