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28 September 2021
Judge sentences St. Louis man for drug/fraud chargesRead the Press Release
ST. LOUIS – United States District Judge Stephen R. Clark today sentenced Derek J. Petty to a term of 91 months in federal prison. Petty was convicted by a jury in April of one count of Conspiracy to Obtain a Controlled Substance by Fraud. The evidence presented at trial proved that Petty’s co-conspirator, Sierra Price, worked at Delmar Primary Care Associates, a small medical practice located in St. Louis. Price wrote and signed more than ten prescriptions for Oxycodone in Petty’s name between April 2018 and December 2018. None of the prescriptions had been authorized by the doctor. The scheme continued unabated because Price, as an employee of Delmar Primary Care Associates, was able to intercept telephone calls from Schnucks’ pharmacists attempting to verify the prescriptions. Before they were caught, Petty and Price obtained over 1,500 oxycodone pills unlawfully.
At the time of the conspiracy, Petty was on supervised release for 2016 convictions for Conspiracy to Distribute Heroin, Distribution of Heroin, Possession of a Firearm in Furtherance of a Drug Trafficking Crime, and Felon in Possession of a Firearm. As part of his guilty plea in the 2016 case, Petty admitted to selling heroin to an undercover police officer, and to selling a dozen firearms (5 of which were stolen) to an undercover ATF agent.
Price, who testified against Petty at trial and who had no previous criminal history, admitted her role in the conspiracy and was sentenced to a term of probation.
United States Attorney Sayler Fleming commended the work of the Drug Enforcement Administration Tactical Diversion Unit and Schnucks’ pharmacists. “We are grateful for the skilled professionals at Schnucks who identified these prescriptions as potentially fraudulent and made every effort to verify their authenticity. Had these pharmacists not continued to question the legitimacy of these prescriptions, this scheme could well have continued undetected for many months.”
This case was investigated by the Drug Enforcement Administration.
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Indictment Unsealed Against Six Individuals and Foreign Financial Service Firm for Tax Evasion ConspiracyRead the Press Release
An indictment was unsealed today in New York, New York, that charges offshore financial service executives and a Swiss financial services company with conspiracy to defraud the IRS by helping three large-value U.S. taxpayer-clients conceal more than $60 million in income and assets held in undeclared, offshore bank accounts and to evade U.S. income taxes.
According to the indictment, from 2009 to 2014, Ivo Bechtiger, Bernhard Lampert, Peter Rüegg, Roderic Sage, Rolf Schnellmann, Daniel Wälchli and Zurich, Switzerland-based Allied Finance Trust AG allegedly defrauded the IRS by concealing income and assets of certain U.S. taxpayer clients with undeclared bank accounts located at Privatbank IHAG (IHAG), a Swiss private bank in Zurich, Switzerland, and elsewhere. In order to assist those clients, the defendants and others allegedly devised and used a scheme called the “Singapore Solution” to conceal the bank accounts of the U.S.-based clients, their assets, and their income from U.S. authorities. In furtherance of the scheme, the defendants and others allegedly conspired to transfer more than $60 million from undeclared IHAG bank accounts of the three U.S. clients through a series of nominee bank accounts in Hong Kong and other locations before returning the funds to newly opened accounts at IHAG, ostensibly held in the name of a Singapore-based asset manager. The U.S. clients allegedly paid large fees to IHAG and others to help them conceal their funds and assets.
“Prosecuting offshore tax evasion remains one of the Tax Division’s highest priorities,” said Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division. “Taxpayers contemplating hiding money abroad – and the foreign bankers, attorneys and finance professionals who design and execute strategies to assist their evasion – should know that the Tax Division and IRS have the investigative resources and expertise to unravel even the most elaborate schemes.”
“As alleged, the individual defendants and the Swiss firm Allied Finance conspired to defraud the IRS by assisting U.S. taxpayers in avoiding their tax obligations,” said U.S. Attorney Audrey Strauss for the Southern District of New York. “They allegedly did this through an elaborate scheme that involved concealing customer assets at a Swiss private bank through nominee bank accounts in Hong Kong and elsewhere, with funds returning to the private bank in the name of a Singapore firm. One such U.S. customer, Wayne Chinn, pleaded guilty to his participation in the so-called ‘Singapore Solution,’ forfeited more than $2 million to the United States, and awaits sentencing for his admitted crime.”
If convicted, the defendants face a maximum penalty of five years in prison, supervised release, and monetary penalties, and the corporate defendant faces monetary penalties. An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Also unsealed today was the guilty plea of Wayne Franklyn Chinn, of Vietnam and San Francisco, California, one of the U.S. taxpayer-clients, who participated in the Singapore Solution scheme.
According to court documents filed in relation to his guilty plea, from 2001 through 2018, Chinn concealed approximately $5 million in undisclosed and untaxed income. During this period, Chinn held accounts in nominee names at Privatbank IHAG. Beginning in 2010, Chinn wired funds from these offshore accounts through nominee accounts in Hong Kong before returning them to newly opened accounts at IHAG held in the name of a Singapore based trust company acting on behalf of two foundations created to conceal Chinn’s ownership of the accounts. Chinn subsequently transferred the funds out of Switzerland to undeclared accounts in Singapore. Chinn did not file any tax returns or disclose his foreign bank accounts during the years at issue.
Chinn pleaded guilty to one count of tax evasion which carries a maximum penalty of five years in prison. Chinn also consented to the civil forfeiture of 83% of the funds held in five accounts at two Singapore banks, which resulted in the successful forfeiture and repatriation to the United States of approximately $2.2 million. The civil forfeiture proceeding is United States of America v. Certain Funds on Deposit in Various Accounts, 20 Civ. 3397 (LJL).
Chinn is scheduled to be sentenced on Nov. 19, and faces a maximum penalty of five years in prison. He also faces a period of supervised release, restitution and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division; U.S. Attorney Audrey Strauss for the Southern District of New York; and Chief James Lee of IRS-Criminal Investigation made the announcement. The Department of Justice Office of International Affairs, the Singapore Attorney-General’s Chambers and the Commercial Affairs Department of the Singapore Police Force provided significant assistance in this matter.
The IRS-Criminal Investigation Division is investigating the case.
Senior Litigation Counsel Nanette Davis and Trial Attorney Sean Green of the Justice Department’s Tax Division and Assistant U.S. Attorney Olga Zverovich of the U.S. Attorney’s Office for the Southern District of New York are prosecuting the case.
Illinois woman admits to counterfeit chargeRead the Press Release
CLARKSBURG, WEST VIRGINIA – Clarissa Mosley, of Chicago, Illinois, has admitted to a counterfeit charge, Acting United States Attorney Randolph J. Bernard announced.
Mosley, 24, pleaded guilty to one count of “Possession of Counterfeit Obligations.” Mosley admitted to having 69 $100 counterfeit bills in December 2020 in Ritchie County.
Mosley faces up to 20 years of incarceration and a fine of up to $250,000 fine. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Christopher L. Bauer is prosecuting the case on behalf of the government. The United States Secret Service, the Ritchie County Sheriff’s Office, and the South Charleston Police Department investigated.
U.S. Magistrate Judge Michael John Aloi presided.
Hudson County Man Admits Assaulting U.S. Postal Service EmployeeRead the Press Release
NEWARK, N.J. – A Hudson County, New Jersey, man today admitted assaulting a U.S. Postal Service employee by pointing a handgun at the employee, Acting U.S. Attorney Rachael A. Honig announced.
Joseph Cartagena, 34, of Jersey City, pleaded guilty by videoconference before U.S. District Judge Brian R. Martinotti to one count of assaulting a federal employee.
According to documents filed in this case and statements made in court:
On March 3, 2021, an employee of the U.S. Postal Service was driving his Postal Service truck in Jersey City, New Jersey, when Cartagena requested that the employee pull over, which he did. The postal employee then exited his truck and approached Cartagena to ask why he had asked him to pull over. Cartagena pulled out a handgun and pointed it at the postal employee. The postal employee immediately pushed Cartagena’s hand away and ran into traffic to get away. Cartagena then entered his car and drove away.
The charge carries a maximum penalty of 20 years in prison and a fine of up to $250,000. Sentencing is scheduled for Feb. 9, 2022.
Acting U.S. Attorney Rachael A. Honig credited postal inspectors of the U.S. Postal Inspection Service, Newark Division, under the direction of Inspector in Charge Raimundo Marrero, and the Jersey City Police Department, with the investigation leading to the charges.
The government is represented by Special Assistant U.S. Attorney Stacey E. Zyriek Enriquez of the U.S. Attorney’s Office Violent Crimes Unit in Newark.
Houston Man Who Supplied Methamphetamine to White Supremacist Gang Sentenced in Eastern District of TexasRead the Press Release
BEAUMONT, Texas – A Houston man has been sentenced to federal prison for drug trafficking violations in the Eastern District of Texas, announced Acting U.S. Attorney Nicholas J. Ganjei today.
Eulalio Torres-Cadenas, 44, pleaded guilty on April 19, 2021, to conspiring to possess with intent to distribute methamphetamine and was sentenced to 87 months in federal prison today by U.S. District Judge Thad Heartfield.
“The sentence today reflects the Eastern District of Texas continuing effort to hold drug traffickers accountable,” said Acting U.S. Attorney Nicholas J. Ganjei. “This is especially important when they are supplying gangs like the Aryan Circle. We will relentlessly pursue those who provide narcotics to violent gangs.”
According to information presented in court, from May 2016 through August 2016, law enforcement officers investigated methamphetamine trafficking activity of Aryan Circle (“AC”) members in the Houston, Southeast Texas, and Southwest Louisiana area. The AC is a violent, white supremacist organization that operates inside federal prisons across the country and outside prisons in states including Texas, Arkansas, Louisiana, and Missouri. As part of the charged conspiracy, Torres was identified as the driver of a vehicle stopped by law enforcement on Aug. 22, 2016, following the delivery of 290 grams of methamphetamine. Further investigation revealed that Torres was part of a conspiracy to deliver between 1.5 kilograms and 5 kilograms of methamphetamine. Torres was indicted by a federal grand jury on Oct. 10, 2020.
This case was investigated by the U.S. Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Houston Police Department, the and the Texas Department of Public Safety. The case was prosecuted by Assistant U.S. Attorney Christopher Rapp.
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Houston Businessman Sentenced for Lake Livingston Insurance Fraud SchemeRead the Press Release
BEAUMONT, Texas – A Houston businessman has been sentenced to prison for federal violations in the Eastern District of Texas, announced Acting U.S. Attorney Nicholas J. Ganjei today.
Robert Lance Kuperman, 74, pleaded guilty on March 22, 2021, to interstate transportation of money by fraud and was sentenced to 24 months in federal prison today by U.S. District Judge Thad Heartfield. Kuperman was also ordered to pay over $1.8 million in restitution.
“Fraud victimizes not only the insurance companies, but costs Americans billions of dollars every year in increased premiums,” said Acting U.S. Attorney Nicholas Ganjei. “I thank our federal, state, and local partners—law enforcement and non-enforcement alike—for the excellent work they provided in this case.”
According to information presented in court, Kuperman purchased a home on Lake Livingston in Polk County in 2013. In July 2015, he submitted an insurance claim related to water damage to the house that he said was caused by a defective water heater. As part of the claim, Kuperman submitted fraudulent documentation supporting his claim for out-of-pocket costs associated with what he represented was his replacement of personal property destroyed by the water leak.
Based on Kuperman’s fraudulent claims, American Strategic Insurance Company issued a series of checks, made payable to Kuperman totaling $412,836.12. As part of the sentence, Kuperman was ordered to repay not only the $412,836.12 to American Strategic Insurance Company, but an additional $1,445,000.00 in restitution to RSUI Indemnity Group for conduct deemed relevant to the offense, for a total of $1,857,836.24 in restitution and an additional fine of $80,000.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Polk County Sheriff’s Office and the Texas State Fire Marshal’s Office. The case was prosecuted by Special Assistant U.S. Attorney Tommy L. Coleman and Assistant U.S. Attorney Donald S. Carter.
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Hartford Man Sentenced to 7 Years in Federal Prison for Drug Distribution and Firearm Possession OffensesRead the Press Release
Leonard C Boyle, Acting United States Attorney for the District of Connecticut, announced that KENDALL JONES, also known as “Wolf,” 32, of Hartford, was sentenced today by U.S. District Judge Alvin W. Thompson in Hartford to 84 months of imprisonment, followed by four years of supervised release, for narcotics distribution and firearm possession offenses.
According to court documents and statements made in court, in September and October 2020, the Drug Enforcement Administration’s Hartford Task Force, along with state and local law enforcement officers, conducted an operation in response to a recent spike in drug-related violence in Hartford’s North End. Jones was identified during the operation as an active drug seller.
On October 7, 2020, investigators sought to arrest Jones on a state arrest warrant and observed him at a gas station on Albany Avenue in Hartford engaging in what appeared to be drug transactions. As task force officers approached Jones, Jones ran and discarded a black leather shoulder bag. Jones was apprehended after a short chase. A search of his person revealed approximately eight grams of crack cocaine and a quantity of marijuana, and the discarded shoulder bag contained a loaded .22 caliber Ruger semiautomatic handgun.
The handgun has been reported stolen in North Carolina in July 2020.
Jones’ criminal history includes state convictions for drug, firearm, robbery and larceny offenses.
Jones, while released on bond in this federal case, was arrested on state narcotics charges on April 9, 2021, after he was again observed making drug sales in Hartford. He has been detained since his arrest.
On April 29, 2021, Jones pleaded guilty in federal court to one count of possession with intent to distribute cocaine base (“crack”), and one count of possession of a firearm in furtherance of a drug trafficking crime.
The DEA’s Hartford Task Force includes personnel from the DEA Hartford Resident Office and the Bristol, Hartford, East Hartford, Manchester, New Britain, Rocky Hill, Wethersfield, Windsor Locks and Willimantic Police Departments.
This case was prosecuted by Assistant U.S. Attorney Brendan Keefe.
This case is part of Project Safe Neighborhoods (PSN), the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
Government Contractor Agrees to Settle Anti-Kickback Act AllegationsRead the Press Release
ALEXANDRIA, Va. – A Maryland-based federal company, as well as its president and sole owner, agreed to pay $450,000 to settle allegations that they solicited and received kickbacks in connection with federal government contracts reserved for “8(a)” small businesses.
Wete and Company, Inc. (Wete), located in Laurel, Maryland, was certified by the Small Business Administration as an 8(a) small business, meaning it was owned and operated by a socially or economically disadvantaged citizen. Dorothy Wete, a resident of Laurel, is the president and owner of Wete. Sage Consulting Group, Inc. (Sage), a federal government contractor located in Vienna, lacked an 8(a) certification.
According to the United States’ allegations, between 2014 and 2020, Wete and Sage agreed that Wete would use its 8(a) certification to bid on government contracts that Sage was not eligible to bid on. Wete and Sage allegedly agreed to subcontract all the work on those contracts to Sage in exchange for a “fee” calculated by each hour of work subcontracted to Sage, and Sage allegedly paid Wete the agreed upon kickback amount when the work was subcontracted to them. The United States and Sage reached a settlement in July 2021.
The settlement resolves allegations under the civil penalty provisions of the Anti-Kickback Act.
The resolutions obtained in this matter were the result of a coordinated effort between the U.S. Attorney’s Office for the Eastern District of Virginia, Department of Defense Office of Inspector General, Defense Criminal Investigative Service, and the General Services Administration Office of Inspector General.
This matter was investigated by Assistant U.S. Attorney Krista Anderson.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. A copy of a press release describing the United States’ settlement with Sage Consulting Group, Inc. can be found here.
The civil claims settled by this agreement are allegations only; there has been no determination of civil liability.
Georgia Man Pleads Guilty to Bank and Mail Fraud Conspiracy Involving 30 Victim Financial InstitutionsRead the Press Release
Greenbelt, Maryland – Willie R. Trimble, age 68, of Statesboro, Georgia, pleaded guilty yesterday to conspiracy to commit mail and bank fraud.
The guilty plea was announced by Acting United States Attorney for the District of Maryland Jonathan F. Lenzner; Postal Inspector in Charge Daniel A. Adame of the U.S. Postal Inspection Service - Washington Division; and Harford County Sheriff Jeffrey R. Gahler.
According to his guilty plea, from 2015 to 2016, Trimble conspired with at least two other individuals to steal, alter, and cash checks written by victim businesses and individuals from U.S. Postal Service (“USPS”) mail receptacles.
In furtherance of the conspiracy, Trimble cashed a counterfeit check for $6,850 at a victim Baltimore financial institution, allowed a co-conspirator to insert his picture onto a fraudulent Georgia State driver’s license under the fake identity of “David Cleveland”, and burglarized a Mississippi U.S. Post Office in which he stole mail and USPS equipment.
Additionally, in November 2017, Trimble used the Cleveland alias and counterfeit Georgia State driver’s license to withdraw funds from a victim South Carolina bank. He also attempted to cash a stolen and altered business check under the same fraudulent identity. In the same month, surveillance footage captured Trimble attempting to cash a stolen check and disposing of stolen mail behind a convenience store.
As part of the scheme to defraud, Trimble and his co-conspirators recruited dozens of individuals to cash altered or counterfeit checks made out to them in exchange for a portion of the proceeds. At times, Trimble supervised and transported groups of cashers to victim financial institutions where the victim businesses banked.
During Trimble’s participation in the conspiracy, the mail and bank fraud scheme resulted in the total loss of at least $119,212.50 to victim individuals, approximately 30 business victims, and 15 federally insured financial institutions within Maryland, Pennsylvania, Virginia, Georgia, South Carolina, and elsewhere.
Trimble faces a maximum sentence of 30 years in prison followed by five years of supervised released for conspiracy to commit bank and wire fraud. U.S. District Judge Stephanie A. Gallagher has not scheduled a sentencing hearing at this time.
Acting United States Attorney Jonathan F. Lenzner commended the USPIS and the Harford County Sheriff’s Office for their work in the investigation. Mr. Lenzner thanked Assistant U.S. Attorney Adam K. Ake and Special Assistant U.S. Attorney Jason X. Hamilton, who are prosecuting the case.
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Four Defendants Indicted for Laundering Target Gift Cards Purchased by Fraud VictimsRead the Press Release
A federal grand jury in Los Angeles returned an indictment against four California-based defendants for their alleged roles laundering fraud proceeds stored on gift cards. The indictment, which was unsealed today, charges U.S. citizen Blade Bai, 33, of El Monte; and Chinese citizens Bowen Hu, 26, of Hacienda Heights; Tairan Shi, 27, of Diamond Bar; and Yan Fu, 58, of Chino Hills, with conspiring to launder proceeds of wire fraud that were stored on gift cards issued by retailer Target.
According to the indictment, defendants Bai, Hu and Shi obtained over 5,000 gift cards from a group known as the “Magic Lamp.” Defendants Bai, Hu and Shi caused the gift cards to be distributed to “runners” like defendant Fu who used the funds on the cards at Target stores in Los Angeles and Orange County and elsewhere to purchase, among other items, consumer electronics and other gift cards. Through the purchases, returns and other transactions at multiple Target stores, the defendants and their co-conspirators sought to conceal the fact that the gift cards had been originally funded with fraudulent proceeds.
The indictment further alleges that perpetrators of the fraud schemes induced victims to send proceeds to defendants’ associates, and defendants then conspired to launder the proceeds. The indictment also alleges that victims of the schemes are spread throughout the United States, including California, Texas, Illinois and Georgia.
“The Department of Justice and its law enforcement partners are committed to tackling fraud schemes from every angle,” said Acting Assistant Attorney General Brian M. Boynton of the Justice Department’s Civil Division. “Individuals who knowingly facilitate the victimization of American consumers make fraud possible, are criminally culpable for the offenses and should expect to be held accountable.”
“This case offers an important reminder to consumers that gift cards are for presents to friends and loved ones – they should never be used for payments to any government or corporate entity,” said Acting U.S. Attorney Tracy L. Wilkison for the Central District of California. “Don’t be fooled by callers claiming to be with a government agency, a bank or any other institution demanding that you purchase gift cards. There is no reason to purchase a gift card to resolve a problem with an account, your Social Security number or a supposed criminal case.”
“The case against these defendants is the result of the impressive work by Homeland Security Investigations’ (HSI) Los Angeles-led El Camino Real Financial Crimes Task Force,” said Special Agent in Charge David A. Prince for HSI Los Angeles. “These types of crimes have devastating effects on the victims. Through coordinated investigative efforts by law enforcement and our prosecution partners, HSI will continue to aggressively investigate those who prey on our elderly population.”
Defendants are charged with conspiracy to commit money laundering. If convicted, they face a maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
This case was investigated by HSI Los Angeles’ El Camino Real Financial Crimes Task Force, a multi-agency task force comprised of federal and state investigators focused on financial crimes in Southern California, with substantial assistance from the FBI Los Angeles Field Office. Investigative assistance was also provided by the Social Security Administration, Office of the Inspector General.
Assistant U.S. Attorney Monica Tait of the Central District of California and Trial Attorney Wei Xiang of the Civil Division’s Consumer Protection Branch are prosecuting the case.
The Consumer Protection Branch and the U.S. Attorney’s Office for the Central District of California are part of the Transnational Elder Fraud Strike Force, which investigates and prosecutes scams run by transnational criminal organizations, including mass mailing, telemarketing, and tech support scams. For more information about the Consumer Protection Branch, visit its website at http://www.justice.gov/civil/consumer-protection-branch.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Founder of New York Litigation Finance Firm Pleads Guilty to Multimillion-Dollar Securities Fraud SchemeRead the Press Release
Audrey Strauss, the United States Attorney for the Southern District of New York, and Philip R. Bartlett, the Inspector-in-Charge of the New York Division of the U.S. Postal Inspection Service (“USPIS”), announced that JAESON BIRNBAUM, an attorney and the founder of Cash4Cases, Inc., a bankrupt litigation funding firm that was headquartered in New York, New York, pled guilty to securities fraud today before U.S. District Judge Paul A. Crotty. BIRNBAUM admitted as part of his plea that he used investor funds for his own purposes and double-pledged the same case recoveries as collateral to multiple parties.
U.S. Attorney Audrey Strauss said: “Jaeson Birnbaum conned investors through a series of lies about his litigation finance business, Cash4Cases. He used Cash4Cases to steal cash for himself and then tried to cover up his scheme by directing a subordinate to falsify books and records. Now Birnbaum awaits sentencing for his fraudulent conduct.”
USPIS Inspector-in-Charge Philip R. Bartlett said: “Everything Mr. Birnbaum told his investors was a lie framed around the idea of a good investment. Postal Inspectors see these cases all the time and remind investors to thoroughly check the fine print on any investment offer, and if the return seems too lucrative or unreal, pass it by to make sure your money goes to fund your lifestyle and not the criminal’s.”
According to the Information and statements made in Court:
From at least in or about 2017 through in or about 2019, BIRNBUAM obtained more than $3 million in investments for Cash4Cases based on fraudulent misrepresentations. These investments were in the form of promissory notes, titled “Investor Security Agreements” (“ISAs”), which purported to provide the relevant investors with a security interest in the recoveries associated with certain specified lawsuits that were ostensibly purchased by Cash4Cases. In fact, in some instances, the lawsuits that were either never funded by Cash4Cases or BIRNBAUM had previously pledged their recoveries to other parties.
To help carry out his fraud, BIRNBAUM directed an employee to falsify his company’s books and records to make it appear that the recoveries from lawsuits that had already been paid out were still available to be pledged as collateral to new investors.
BIRNBAUM also misappropriated a substantial portion of investors’ funds for his personal use and to make promised payments to earlier investors. As one example, BIRNBAUM obtained a $1 million investment for Cash4Cases in September 2019. Prior to this investment, BIRNBAUM told the investor that Cash4Cases would use the money exclusively for advances to litigants. However, contrary to this representation, on the same date that Cash4Cases received the $1 million investment, BIRNBAUM used the money to send a $530,000 wire toward the purchase of a house in New Jersey.
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BIRNBAUM, 47, of Boca Raton, Florida, faces 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. BIRNBAUM is scheduled to be sentenced before Judge Crotty on January 6, 2022, at 12:00 p.m.
Ms. Strauss praised the investigative work of the USPIS. Ms. Strauss also thanked the Securities & Exchange Commission, which brought a civil action today against BIRNBAUM in Manhattan federal court.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorney Daniel Loss is in charge of the prosecution.
Former Air Force Employee Pleads Guilty to Receiving Stolen Government Money Through Falsified Travel ClaimsRead the Press Release
OKLAHOMA CITY – Yesterday, ANTHONY RAY JONES, 55, of Midwest City, pleaded guilty to receiving approximately $55,210.50 in stolen money from the federal government through falsified travel claims, announced Acting U.S. Attorney Robert J. Troester.
On May 4, 2021, a federal grand jury returned a one-count Indictment against Jones. The Indictment charged that between May 4, 2016 and August 22, 2019, Jones knowingly received stolen money belonging to the United States.
At yesterday’s hearing, Jones pleaded guilty. Public records reflect that Jones had been employed with the Department of the Air Force. During his employment, Jones sustained injuries and applied for and received worker’s compensation money under the Federal Employees’ Compensation Act. As part of his compensation, Jones was able to be reimbursed for travel expenses to and from medical appointments related to his injuries. From May 4, 2016, through August 22, 2019, Jones filed hundreds of false travel claims for medical appointments and was reimbursed approximately $55,210.50 resulting from those false travel claims. At his plea hearing, Jones admitted that he intended to keep the money and that he knew the money was stolen. At sentencing, he faces up to ten years in prison, a $250,000 fine, mandatory restitution, and up to three years of supervised release.
This case is the result of an investigation by the U.S. Department of Labor, Office of Inspector General, Office of Labor Racketeering and Fraud Investigations. The case is being prosecuted by Assistant U.S. Attorney Bow Bottomly.
Reference is made to court filings for further information.
Forest Hills Couple Charged in Marriage Fraud SchemeRead the Press Release
PITTSBURGH, PA - Two suburban Pittsburgh residents have been indicted by a federal grand jury in Pittsburgh on charges of conspiring to commit offenses against the United States, making false statements in matters relating to naturalization or citizenship, and unlawfully attempting to and procuring naturalization or citizenship, Acting United States Attorney Stephen R. Kaufman announced today.
The five-count Superseding Indictment named Man Ho, 32, and Le Thuy Nguyen, also known as Kim Nguyen, 48, of the 3300 block of Lenox Drive in Pittsburgh, PA (Forest Hills) as the defendants.
According to the Superseding Indictment, Ho and Nguyen are charged at Count One with conspiring to commit offenses against the United States. At Counts Three and Five, Ho and Nguyen respectively are charged with making false statements related to obtaining naturalization or citizenship. Finally, at Count Two, Ho is charged with unlawfully attempting to obtain naturalization or citizenship, while Nguyen is charged at Count Four with unlawfully procuring naturalization or citizenship.
As to Counts Two and Four, the law provides for a maximum total sentence of not more than 10 years in prison, a fine of $250,000 or both. At Counts One, Three, and Five, the law provides for a maximum total sentence of 5 years in prison, a fine of $250,000 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendants.
Assistant United States Attorneys Cindy K. Chung and Yvonne M. Saadi are prosecuting this case on behalf of the government.
Homeland Security Investigations and the United States Citizenship and Immigration Services conducted the investigation leading to the Superseding Indictment in this case.
A superseding indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Florida Man Who Called for Race-Based Civil War Sentenced on Multiple Firearms OffensesRead the Press Release
Miami, Florida – Today, a South Florida federal district judge sentenced Paul Nicholas Miller, 33, of Fort Lauderdale, Florida, to 41 months’ imprisonment followed by three years’ supervised release for possessing a firearm as a convicted felon in 2018, possessing ammunition as a convicted felon in 2021, and possessing an unregistered short-barreled rifle in 2021.
Miller, who had previously been convicted of three separate felony offenses in New Jersey, took a live firearms training in Fort Lauderdale, Florida in January 2018, during which he fired a handgun. Miller then used the certificate of completion from this training to apply to Florida authorities for a concealed weapon license. In this application, Miller falsely affirmed that he had never been convicted of a felony. Florida authorities denied Miller’s application due to his prior felony convictions. Federal law enforcement then arrested Miller on March 2, 2021 after a federal grand jury returned an indictment in connection with Miller’s 2018 conduct.
After this arrest, law enforcement discovered an unregistered short-barreled rifle and hundreds of rounds of ammunition inside Miller’s home. Miller admitted that he had bought the ammunition and that he had tried to build his own rifle in part to learn about firearms manufacturing in preparation for a coming civil war. In the months immediately before his arrest, Miller had made hundreds of internet posts publicizing his animosity towards various minority groups and his support for the initiation of a race-based civil war in the United States.
A federal grand jury returned a superseding indictment adding two counts for Miller’s 2021 possession of the ammunition and the unregistered short-barreled rifle law enforcement found in his home. On June 22, Miller pled guilty to all three charges in the superseding indictment before U.S. District Judge Raag Singhal, who imposed today’s sentence.
Juan Antonio Gonzalez, Acting U.S. Attorney for the Southern District of Florida, and George Piro, Special Agent in Charge of the Federal Bureau of Investigation (“FBI”) Miami Division, made the announcement.
FBI handled the investigation, with assistance from the Fort Lauderdale Police Department and the FBI’s Joint Terrorism Task Force. Assistant U.S. Attorney Kiran N. Bhat prosecuted the case.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or at http://pacer.flsd.uscourts.gov, under case number 21-60067-CR-Singhal/Snow(s).
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Florida Man Pleads Guilty to Methamphetamine OffenseRead the Press Release
Gulfport, Miss. – A Florida man pled guilty to possession with intent to distribute methamphetamine, announced Acting U.S. Attorney Darren J. LaMarca and Special Agent in Charge Jermicha Fomby of the Federal Bureau of Investigation.
According to court records, on February 24, 2021, law enforcement officers stopped a vehicle driven by Vincente Aguirre, 29, in Jackson County for a traffic violation. A subsequent search of the vehicle led to the discovery of over 400 grams of methamphetamine.
Further investigation revealed that Aguirre had traveled to Texas from Florida to obtain the methamphetamine and was returning to Florida at the time of the traffic stop.
Aguirre will be sentenced on January 19, 2022, at 10:00 a.m. He faces a maximum sentence of 40 years in prison. A federal district judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The FBI and the Ocean Springs Police Department investigated the case.
Assistant U.S. Attorney Jonathan Buckner is prosecuting the case.
Federal Grand Jury Indicts 4 SoCal Defendants in Scheme to Launder Target Gift Cards Purchased by Victims of ScamsRead the Press Release
LOS ANGELES – Federal authorities this morning arrested two people named in an indictment alleging a scheme to launder the proceeds of scams sent to fraudsters via Target gift cards.
Bowen Hu, 26, of Hacienda Heights, and Tairan Shi, 27, of Diamond Bar, both Chinese nationals, were taken into custody today and are expected to be arraigned this afternoon in United States District Court in downtown Los Angeles.
Two other defendants named in the indictment – Blade Bai, 33, of El Monte, a U.S. citizen, and Yan Fu, 58, of Chino Hills, also a Chinese national – will be summonsed to appear in federal court next month.
The one-count indictment unsealed today charges all four defendants with conspiring to launder proceeds of wire fraud that were stored on gift cards issued by Target. The indictment alleges that Bai, Hu and Shi obtained more than 5,000 gift cards from a group that called itself the “Magic Lamp” and sold gift card information via an online messenger application.
Bai, Hu and Shi oversaw the distribution of gift cards to “runners,” including Fu, who used the funds on the cards at Target stores primarily in Los Angeles and Orange counties to purchase consumer electronics, other gift cards and other items, according to the indictment. Through the purchases and other transactions at multiple Target stores, the defendants and their co-conspirators sought to conceal the fact that the gift cards had been originally funded with fraudulent proceeds.
The indictment alleges that perpetrators of fraud schemes induced victims across the United States to purchase Target gift cards. Then, the indicted defendants in Southern California conspired to launder the proceeds. The victims, who were often older adults, were tricked into buying the gift cards based on various fraudulent schemes, including:
- Government-imposter scams, in which fraudsters impersonate government officials, such as officials with the Social Security Administration or local police officers, and falsely claim that victims need to purchase gift cards to resolve an issue, such as a pending arrest warrant or a problem with the victims’ Social Security number; and
- Tech support scams, in which fraudsters trick victims into believing there is a serious problem with their computer or with account access which can only be solved by paying substantial amounts through gift cards.
“This case offers an important reminder to consumers that gift cards are for presents to friends and loved ones – they should never be used for payments to any government or corporate entity,” said Acting United States Attorney Tracy L. Wilkison. “Don’t be fooled by callers claiming to be with a government agency, a bank or any other institution demanding that you purchase gift cards. There is no reason to purchase a gift card to resolve a problem with an account, your Social Security number or a supposed criminal case.”
“The Department of Justice and its law enforcement partners are committed to tackling fraud schemes from every angle,” said Acting Assistant Attorney General Brian M. Boynton of the Justice Department’s Civil Division. “Individuals who knowingly facilitate the victimization of American consumers make fraud possible, are criminally culpable for the offenses and should expect to be held accountable.”
“The case against these defendants is the result of the impressive work by Homeland Security Investigations’ (HSI) Los Angeles-led El Camino Real Financial Crimes Task Force,” said Special Agent in Charge David A. Prince for HSI Los Angeles. “These types of crimes have devastating effects on the victims. Through coordinated investigative efforts by law enforcement and our prosecution partners, HSI will continue to aggressively investigate those who prey on our elderly population.”
According to court documents, Bai, Hu and Shi obtained the gift card numbers from the Magic Lamp group, often on the same day fraud victims had purchased the gift cards at the direction of a telephone scammer. Fu travelled to as many as 17 Target stores in a single day to conduct gift card transactions, and Bai resold the purchased consumer electronics, using some of the proceeds to pay the Magic Lamp group, the court documents allege.
Investigators conservatively estimate that the defendants laundered more than $2.5 million in gift cards between approximately June 2019 and November 2020.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
All four defendants are charged with conspiracy to commit money laundering, a felony offense that carries a statutory maximum penalty of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Bai and Fu were initially arrested in this matter on November 17, 2020 pursuant to criminal complaints. Bai was released on bond and was subsequently named in a criminal information charging him with conspiracy to commit money laundering. Bai pleaded not guilty to the charge in the information. The indictment announced today supersedes the criminal information. The complaint against Fu was dismissed in December 2020 to further the investigation that has resulted in the indictment.
This case is the product of an investigation by HSI and the FBI. The investigation was conducted under the auspice of HSI’s Los Angeles’ El Camino Real Financial Crimes Task Force, a multi-agency task force comprised of federal and state investigators focused on financial crimes in Southern California.
The Social Security Administration, Office of the Inspector General also provided assistance during the investigation, as did the following: the Brea (California) Police Department, the Glynn County (Georgia) Police Department, the Fontana (California) Police Department, the Charlotte-Mecklenburg (North Carolina) Police Department, the Streamwood (Illinois) Police Department, the Cleveland (Ohio) Police Department, the Madera County (California) Sheriff's Office, the New York Police Department, the Norwood (New Jersey) Police Department, the Loudon County (Virginia) Sheriff's Office, the Waukesha County (Wisconsin) Sheriff's Department, the Fremont (California) Police Department, the Marin County (California) Sheriff's Office, the County of Hawaii Police Department, the Henderson (Nevada) Police Department, the Wilmington (Massachusetts) Police Department, the Las Vegas (Nevada) Metropolitan Police Department, the Lewisville (Texas) Police Department, the Gardena (California) Police Department, the Des Moines (Iowa) Police Department, the Cobb County (Georgia) Sheriff`s Department, the Millburn (New Jersey) Police, the Wauwatosa (Wisconsin) Police Department, the San Angelo (Texas) Police Department, the Fairfax City (Virginia) Police Department, and the Virginia Beach (Virginia) Police Department.
Assistant United States Attorney Monica Tait of the Major Frauds Section and Justice Department Trial Attorney Wei Xiang of the Civil Division’s Consumer Protection Branch are prosecuting the case.
The United States Attorney’s Office and the Consumer Protection Branch are part of the Transnational Elder Fraud Strike Force, which investigates and prosecutes scams run by transnational criminal organizations, including mass mailing, telemarketing and tech support scams.
If you fall victim to a gift card scam, immediately call the gift card issuer and ask them to freeze the gift card numbers involved – and save your receipt and the gift card. Then, report the crime to the FBI’s Internet Crime Complaint Center at www.ic3.gov, the Federal Trade Commission at https://reportfraud.ftc.gov/#/ or 877-382-4357, and your local police department.
Essex County Man Sentenced to 65 Months in Prison for Drug Conspiracy and Distribution of Crack in Stephen Crane VillageRead the Press Release
NEWARK, N.J. – An Essex County, New Jersey, man was sentenced today to 65 months in prison for distributing and conspiring with others to distribute more than 28 grams of cocaine base, Acting U.S. Attorney Rachael A. Honig announced.
Nasir Williams, 24, of Newark, previously pleaded guilty by videoconference before U.S. District Court Judge John Michael Vazquez to an information charging him with one count each of conspiracy to distribute and possess with intent to distribute 28 grams or more of cocaine case and distribution of 28 grams or more of cocaine base. Judge Vazquez imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
Stephen Crane Village is a public housing complex in Newark, on the border with Belleville, New Jersey. From at least February 2019 through February 2020, law enforcement officers investigated individuals that controlled an open-air drug market that operated there.
Through numerous controlled purchases of narcotics, consensually recorded telephone calls and text messages, physical surveillance, and the analysis of telephone records, law enforcement officers determined that numerous individuals, including Williams, conspired to distribute and did actually distribute narcotics, including heroin, fentanyl, cocaine and cocaine base, in and around Stephen Crane Village. On Jan. 15, 2020, in Stephen Crane Village, Nasir Williams sold approximately 31 grams of cocaine base to an individual while under surveillance by law enforcement.
In addition to the prison term, Judge Vazquez sentenced Williams to four years of supervised release.
Acting U.S. Attorney Honig credited special agents and task force officers with the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Jeffrey L. Matthews; the Belleville Police Department, under the direction of Chief Mark Minichini; special agents and task force officers of the DEA, under the direction of Special Agent in Charge Susan A. Gibson in Newark; the Newark Police Department, under the direction of Public Safety Director Brian O’Hara; the Essex County Prosecutor’s Office, under the direction of Acting Prosecutor Theodore N. Stephens II; and the Essex County Sheriff’s Office, under the direction of Sheriff Armando B. Fontoura, with the investigation leading to today’s guilty plea. He also thanked the U.S. Marshals Service, the Nutley Police Department, the Bloomfield Police Department, the West Orange Police Department, the Verona Police Department, the Orange Police Department and the Bergen County Sheriff’s Office for their assistance with this case.
This investigation was part of the Newark Violent Crime Initiative (VCI), where the U.S. Attorney’s Office has partnered with state, federal, county, and local law enforcement to investigate crime in Newark and the surrounding cities. This case is also conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF). The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
The government is represented by Assistant U.S. Attorneys Tracey Agnew and Cassye Cole of the Organized Crime and Gangs Unit of the U.S. Attorney’s Office’s Criminal Division in Newark.
Elmira Methamphetamine Trafficker Going to Prison for More Than 19 YearsRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051ROCHESTER, N.Y.--U.S. Attorney James P. Kennedy, Jr., announced today that Jamal A. Anderson a/k/a Jamel Anderson a/k/a Jemel Jefferson a/k/a James Jefferson a/k/a Mike Jefferson a/k/a Blaze, 40, of Elmira, NY, who was convicted of conspiring to possess with intent to distribute 50 grams or more of methamphetamine, was sentenced to serve 235 months in prison by U.S. District Judge David G. Larimer.
Assistant U.S. Robert A. Marangola, who handled the case, stated that the charges stem from a long-term, multi-agency investigation into the trafficking of large quantities of methamphetamine in the City of Elmira. On September 13, 2019, investigators executed a federal search warrant at an apartment at 916 Grand Central Avenue in Elmira. Officers seized over 1.1 kilograms of 95% pure methamphetamine, a quantity of heroin, and narcotics distribution paraphernalia. Anderson was arrested along with co-defendants Kevin E. Anderson a/k/a K-Born and Briana Hall.
The defendant conspired with McKinney and others to distribute 50 grams or more of actual methamphetamine. Anderson’s involvement in the conspiracy included, among other things, purchasing large quantities of methamphetamine, storing and packaging methamphetamine for distribution at various locations in Elmira, including 508 W. First Street, 912 Grand Central Avenue, 916 Grand Central Avenue, and 267 Henry Street, facilitating third-party purchases of methamphetamine, and directly distributing methamphetamine to others. During the conspiracy, Anderson and other members of the conspiracy possessed firearms.
Kevin E. McKinney and Briana were previously convicted and sentenced.
The sentencing is the culmination of an investigation on the part of the Elmira Police Department, under the direction of Chief Joseph Kane; the New York State Police Community Narcotics Enforcement Team (CNET), under the direction of Lieutenant Kevin Reyes and Major Mary Clark; and the Drug Enforcement Administration, under the direction of Special Agent-in-Charge Ray Donovan, New York Field Division.
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EOIR Announces "Access EOIR" InitiativeRead the Press Release
FALLS CHURCH, VA – The Executive Office for Immigration Review (EOIR) today announced its “Access EOIR” initiative. Through this multi-faceted effort, EOIR aims to increase access to information and raise the level of representation for individuals appearing before the immigration courts. Following the Agency’s recent launch of the FOIA Public Access Link to simplify access to records, more than 100 meetings with stakeholders throughout the past eight months, and ongoing deployment of the EOIR Courts & Appeals System, the latest efforts include the new Counsel for Children Initiative (CCI) and the refresh of the Model Hearing Program (MHP).
“I am pleased to announce our launch of the ‘Access EOIR’ initiative,” said EOIR Director David Neal. “By providing noncitizens and their representatives with more resources, we can better ensure that respondents understand immigration court proceedings, that legal representation before EOIR will increase, and that the public will grow more confident in the due process our Immigration Judges provide.”
The CCI works to provide legal representation to certain unaccompanied children who are in immigration proceedings in the eight immigration courts in which Government-funded counsel for children will have the greatest impact: Atlanta, Houston, Los Angeles, New York, San Diego, San Francisco, Seattle, and Portland. Through this initiative, EOIR will also help to identify children who have been victims of human trafficking or abuse and refer them to appropriate support services.
EOIR is also launching updated trainings under MHP today. The MHP is an educational program for those who practice, or would like to explore practice, in EOIR’s immigration courts. With the goal of increasing advocacy in immigration court—in quantity and quality—EOIR is providing training and resources for multiple learning types through these efforts. Today, EOIR will hold the first of 11 scheduled MHP events, which will be followed by regularly scheduled MHP events. Each event includes presentations by Immigration Judges, staff attorneys, and court administrators via webinar. MHP events include a model master calendar hearing and a model individual hearing, preceded by a substantive law training to assist participants in understanding the law underlying the event’s case fact pattern.
For those unable to attend an MHP event, and those seeking to revisit the content from live trainings, the MHP is developing recorded materials for on-demand viewing, and has published a dynamic list of resources, available through the Immigration Court Online Resource (ICOR). ICOR also provides information about potential forms of relief through an interactive tool. The MHP is available to provide resources or set up an MHP event upon request from individuals and groups interested in learning more about the mechanics of immigration court proceedings.
“Access EOIR” provides respondents, representatives, and the general public with more direct access to agency and case information and the systems that contain it, further supporting transparency and due process for all those with business before the Agency. EOIR welcomes feedback from the public about ways to expand “Access EOIR.”
Duplin County Man Receives 116 Months for Circle K RobberyRead the Press Release
NEW BERN, N.C. – A Magnolia man was sentenced today to 116 months in prison for his role in a Wilmington convenience store robbery and car-jacking that resulted in a car crash at an elementary school.
According to court documents and other information presented in court, Cory Montan Dixon, 40, and a co-defendant donned masks in the early morning hours of August 18, 2019 and robbed the Circle K gas station on Gordon Road in Wilmington. Dixon’s co-defendant, Ronald Lee Croll (sentenced earlier this year), brandished a handgun, later determined to be a BB gun, pointed it at the head of the store clerk and demanded money. After the clerk handed over the cash drawer, the clerk was taken to a back room to retrieve the keys to the clerk’s car. The clerk was then ordered to lay on the floor and an attempt was made to zip tie the clerk’s wrists were together. The two men then took the clerk’s car and fled with the cash drawer and a number of cigarette packs. New Hanover County Sheriff’s Deputies spotted the vehicle on Market Street and gave pursuit. The car tried to elude officers by driving at a high rate of speed through a residential neighborhood, eventually going off the road before crashing into a basketball hoop at Blair Elementary School. Dixon and Croll then fled on foot before being apprehended. Officers recovered zip ties, cash, the BB gun, cigarettes, the cash drawer, and clothing worn during the robbery from the vehicle and along the flight path of the defendants.
G. Norman Acker, III, Acting U.S. Attorney for the Eastern District of North Carolina made the announcement after sentencing by U.S. District Judge Louise W. Flanagan. The Federal Bureau of Investigation and New Hanover County Sheriff’s Office investigated the case, the Wilmington Police Department assisted in the response, and Assistant U.S. Attorney Bryan Stephany prosecuted the case.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The United States Attorney’s Office for the Eastern District of North Carolina implements the PSN Program through its Take Back North Carolina Initiative. This initiative emphasizes the regional assignment of federal prosecutors to work with law enforcement and District Attorney’s Offices on a sustained basis in those communities to reduce the violent crime rate, drug trafficking, and crimes against law enforcement.
Related court documents and information can be found on the website of the U.S. District Court for the Eastern District of North Carolina or on PACER by searching for Case No. 7:19-CR-00092-FL.
Danbury Man Charged with Multiple Child Exploitation OffensesRead the Press Release
Leonard C Boyle, United States Attorney for the District of Connecticut, and Matthew B. Millhollin, Special Agent in Charge, Homeland Security Investigations (HSI), Boston, today announced that WAYNE MARCELL, 35, of Danbury has been charged by federal criminal complaint with multiple child exploitation offenses.
Marcell appeared today via videoconference before U.S. Magistrate Judge Robert M. Spector. He has been detained since his arrest on related state charges on June 23, 2021.
As alleged in court documents, in April 2021, a 14-year-old female in Georgia met Robert Fyke, 33, of Lubbock, Texas, on an online video/chat platform. Fyke and the minor victim then used Kik and other social media platforms to communicate. In May 2021, Fyke drove from Texas to Georgia, picked up the minor victim and drove her back to Lubbock. The minor victim resided with Fyke for approximately four weeks.
It is further alleged that, while living with Fyke, the minor victim began communicating with Marcell on video game and social media platforms. In June 2021, Marcell paid an individual $2,000 to drive the minor victim from Texas to Illinois. Marcell then drove from Connecticut to Illinois, picked up the minor victim, and brought her to his home in Danbury. Marcell engaged in multiple illicit sexual acts with the minor victim, and took photos and videos of the sexual abuse.
The complaint charges Marcell with sexual exploitation of a child, which carries a mandatory minimum term of imprisonment of 15 years and a maximum term of imprisonment of 30 years; receipt of child pornography, which carries a mandatory minimum term of imprisonment of five years and a maximum term of imprisonment of 20 years; and transportation of a minor with the intent to engage in illegal sexual activity, and conspiracy, which carries a mandatory minimum term of imprisonment of 10 years and a maximum term of imprisonment of life.
Fyke, who has been detained since his arrest on June 17, 2021, has been charged in the Northern District of Texas.
Acting U.S. Attorney Boyle stressed that a criminal complaint is not evidence of guilt. Charges are only allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being investigated by Homeland Security Investigations, with the assistance of the U.S. Marshals Service and Danbury Police Department. The case is being prosecuted by Assistant U.S. Attorney Nancy V. Gifford with the cooperation of the Danbury State’s Attorney’s Office.
This prosecution is part of the U.S. Department of Justice’s Project Safe Childhood Initiative, which is aimed at protecting children from sexual abuse and exploitation. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
To report cases of child exploitation, please visit www.cybertipline.com.
Detroit City Councilman Andre Spivey Pleads Guilty to Bribery ConspiracyRead the Press Release
DETROIT - Detroit City Councilman Andre Spivey, 47, of Detroit, pleaded guilty today to conspiring with a member of his staff to commit bribery by accepting over $35,000 in bribe payments in connection with the City Council’s oversight of towing in Detroit, Acting United States Attorney Saima S. Mohsin announced today.
According to court records, while serving as an elected member of the Detroit City Council, Andre Spivey accepted $35,900 from an undercover federal law enforcement officer and a confidential source of information for the FBI. On eight separate occasions between February 2018 and February 2020, Spivey, or a member of his staff identified as “Public Official A,” accepted bribe payments amounting to thousands of dollars from the undercover agent or the confidential source, all in connection with towing issues pending before the City Council. For example, on October 26, 2018, Spivey met with the undercover agent and the confidential source at the Side Street Diner in the City of Grosse Pointe, Michigan. During that meeting, Spivey accepted $1,000 in cash from the undercover agent and another $1,000 in cash from the confidential source. The payments were made to Spivey seeking Spivey’s assistance with a proposed towing ordinance pending before the City Council. As another example of the corrupt payments, on February 21, 2020, the confidential source gave $8,000 in cash to Public Official A, and the undercover agent gave Public Official A $4,000 in cash. Public Official A took the money knowing that it was given for the benefit of Spivey and in exchange for Spivey’s assistance with towing issues pending before the City Council.
Spivey has served on the Detroit City Council since 2009.
The bribery conspiracy count to which Spivey pleaded guilty carries a maximum sentence of 5 years of imprisonment. Under the United States Sentencing Guidelines, it is likely that Spivey will face a guideline sentencing range of between 37 and 46 months of imprisonment, and a maximum fine of up to $250,000. A sentencing date has been set for January 19, 2022.
It is expected that Spivey will resign from office on the City Council as a result of his guilty plea.
This is the first case charged as part of the government’s investigation known as “Operation Northern Hook.” Northern Hook is an investigation of corruption within the government and the Police Department of the City of Detroit relating to the towing industry and other matters.
Mohsin was joined in the announcement by Timothy Waters, Special Agent In Charge of the Michigan Field Office of the Federal Bureau of Investigation.
Acting United States Attorney Mohsin said: “The people of Detroit deserve a city government free of corruption and pay-to-play politics. The conviction of Councilman Spivey for accepting $35,000 in bribes demonstrates that the federal government remains vigilant and determined in rooting out corruption within the City of Detroit.”
“Unfortunately, we continue to see corruption by Detroit public officials that erodes the public's trust in government and undermines the City's effort to move Detroit forward,” said Timothy Waters, Special Agent in Charge of the FBI’s Detroit Field Office. “Today’s guilty plea is a result of the FBI’s commitment to bringing corrupt officials to justice and should serve as warning to others who think they are beyond the reach of the law.”
This case is part of the government’s wide-ranging corruption investigation known as Operation Northern Hook. The investigation of this case was conducted by the Federal Bureau of Investigation. The case is being prosecuted by Assistant U.S. Attorneys David A. Gardey and Frances Carlson.
Concrete Contractor Pleads Guilty to Rigging Bids for Public Contracts in MinnesotaRead the Press Release
A Minnesota concrete contractor pleaded guilty to rigging bids on public concrete repair and construction contracts in the state of Minnesota.
According to court documents filed in the U.S. District Court in Minneapolis, Clarence Olson and his co-conspirators conspired to rig bids on concrete repair and construction contracts submitted to at least four municipalities in the state of Minnesota, which included local governments and school districts in the Minneapolis-St. Paul area. Olson participated in the long-running conspiracy from at least as early as September 2012 and continuing through at least as late as July 2017.
“This resolution demonstrates the Antitrust Division’s commitment to ensuring the integrity of government procurement at all levels of government,” said Acting Assistant Attorney General Richard A. Powers of the Justice Department’s Antitrust Division. “Bid-rigging schemes that target local government contracts harm taxpayers, and people who take part in these conspiracies will be held accountable for their actions.”
“The defendant in this case rigged bids on contracts that were intended to benefit local governments and school districts in Minnesota,” said Assistant Director Calvin Shivers of the FBI’s Criminal Investigative Division. “The FBI and our law enforcement partners are committed to investigating those who attempt to exploit government programs and the American taxpayer.”
Olson pleaded guilty to a violation of Section 1 of the Sherman Act. He faces a maximum penalty of 10 years in prison and a $1 million criminal fine. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime if either amount is greater than the statutory maximum fine. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The Antitrust Division’s Chicago Office is prosecuting the case, which was investigated with the assistance of the FBI’s Minneapolis Field Office.
In November 2019, the Department of Justice created the 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. For more information, visit https://www.justice.gov/procurement-collusion-strike-force.
Anyone with information in connection with this investigation should contact the Antitrust Division’s Complaint Center at 888-647-3258, or visit http://www.justice.gov/atr/report-violations.
Colebrook Man Sentenced to 40 Months for Fentanyl TraffickingRead the Press Release
CONCORD - Timothy Nugent, 34, of Colebrook, was sentenced on Monday to 40 months in federal prison for possession of fentanyl with intent to distribute, Acting United States Attorney John J. Farley announced today.
According to court documents and statements made in court, on May 17, 2019, a Manchester police officer encountered Nugent standing at the open door of a car parked blocking a driveway. Nugent said it was not his vehicle but he had permission to be in it from a friend in Colebrook. As Nugent produced the registration, the officer observed several baggies on the front passenger seat. Nugent handed the officer one of the baggies and consented to a search of his wallet. After the officer located a Suboxone tab in Nugent’s wallet and Nugent stated he did not have a prescription for Suboxone, the officer arrested Nugent. After obtaining a search warrant for the vehicle, officers discovered a box containing over 34 grams of fentanyl, a scale, and bank cards, including one in Nugent’s name.
“Fentanyl continues to cause far too many deaths in New Hampshire,” said Acting U.S. Attorney Farley. “To protect our community from the threat posed by this deadly substance, we work closely with our law enforcement partners to identify and prosecute the drug traffickers who are distributing fentanyl and other opioids in the Granite State.”
“Fentanyl is causing deaths in record numbers and DEA’s top priority is to aggressively pursue anyone who distributes this poison in order to profit and destroy lives,” said DEA Special Agent in Charge Brian D. Boyle. “Illegal drug distribution ravages the very foundations of our families and communities so every time we take fentanyl off the streets, lives are saved. This investigation demonstrates the strength of collaborative local, state and federal law enforcement efforts in New Hampshire and our strong partnership with the U.S. Attorney’s Office.”
This matter was investigated by the Drug Enforcement Administration, the Manchester Police Department, the New Hampshire State Police, and the Colebrook Police Department. The case was prosecuted by Assistant U.S. Attorneys John S. Davis and Aaron Gingrande.
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Chicago Woman Charged with Filing False Income Tax Returns to Fraudulently Obtain Refunds and Stimulus PaymentsRead the Press Release
CHICAGO —A Chicago woman has been indicted on federal criminal charges for allegedly fraudulently obtaining the personal identifying information of deceased individuals and using it to file for tax refunds and stimulus payments from the U.S. Treasury.
An indictment returned Monday in federal court in Chicago charges KATRINA PIERCE, 50, with ten counts of wire fraud, six counts of aggravated identity theft, three counts of making false statements to the U.S. Small Business Administration, and one count of possessing identification documents to defraud the United States. Arraignment is set for Oct. 5, 2021, at 9:30 a.m. before U.S. District Judge Virginia M. Kendall.
The indictment was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Justin Campbell, Acting Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago. The government is represented by Assistant U.S. Attorney Brian Havey.
According to the indictment, Pierce fraudulently requested and obtained death certificates for individuals from Illinois and several other states. Pierce then used personal identifying information of deceased individuals to file false income tax returns with the IRS so that she could fraudulently obtain tax refunds and stimulus payments under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, the indictment states. Pierce allegedly claimed a deceased boy as a dependent on her own tax return and attached to other false returns bogus birth certificates that falsely claimed deceased children as dependents.
The indictment also accuses Pierce of fraudulently submitting applications to the SBA seeking loans under the COVID-19 Economic Injury Disaster Loan (EIDL) program, a financial assistance program for small businesses suffering from a temporary loss of revenue due to the Coronavirus pandemic. Pierce submitted false applications under her own name and under the names of other persons, including farmers and small business owners in Illinois and other states, whose personal identity information was unlawfully taken and used without their knowledge, the charges allege. The indictment describes applications submitted by Pierce in which she fraudulently claimed to be the owner of a manufacturing business with 106 employees and a retail electronics business with 14 employees, with both businesses purportedly located at the same address – an apartment where Pierce was then residing.
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. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.
Center City Doctor Pleads Guilty to Illegally Distributing Controlled Substances and Filing False Tax Returns and Agrees to Pay $4 Million to Resolve Civil and Related AllegationsRead the Press Release
PHILADELPHIA, PA – Acting United States Attorney Jennifer Arbittier Williams announced that Stephen Padnes, M.D., 79, of Glenside, Pennsylvania, a physician formerly licensed in Pennsylvania, entered a guilty plea before United States District Court Judge Gene E.K. Pratter on criminal charges of illegally distributing controlled substances and filing false tax returns.
Williams also announced that Padnes has agreed to pay $2 million to settle a civil lawsuit brought by the United States seeking penalties and damages against him. The settlement resolves allegations that Padnes prescribed opioids without a legitimate medical purpose in violation of the Controlled Substances Act and False Claims Act (the “Civil Action”). The resolution of the Civil Action also excludes Padnes from participating in the Medicare program for at least ten years.
Padnes has also entered into a settlement agreement with the United States whereby he has agreed to the civil forfeiture of over $1.8 million in cash seized from his home as proceeds of unlawful prescribing (the “Forfeiture Action”).
The Drug Enforcement Agency has also rescinded Padnes’s licenses to prescribe controlled substances.
Criminal Guilty Plea
Earlier today, Padnes pled guilty to the criminal indictment, which charged him with illegally prescribing Schedule II controlled substances, oxycodone and methadone, on seven occasions between December 21, 2015 and June 29, 2016, without any medical necessity and outside the usual course of medical practice. It also charged that Padnes underreported the income earned by his medical practice, the Psychosomatic Medicine and Pain Rehabilitation Center, Inc., to the Internal Revenue Service by more than $700,000 for calendar years 2012, 2013, and 2014. Padnes faces a maximum possible sentence of 149 years’ imprisonment and has agreed to pay $301,219 in restitution to the IRS.
$2 Million Settlement of the Civil Action and Exclusion from Medicare
Padnes has agreed to pay an additional $2 million to settle the government’s allegations against him in the Civil Action brought pursuant to the Controlled Substances Act and the False Claims Act. Padnes has also agreed to be excluded from participating as a provider in the Medicare program for at least ten (10) years.
The Civil Action alleges that Padnes violated the Controlled Substances Act by issuing prescriptions on hundreds of occasions for Schedule II opioids in 2014, 2015, and 2016 without a legitimate medical purpose. The government alleges numerous instances where Padnes accepted cash payments, hundreds of dollars each, in exchange for prescriptions for high doses of opioids without maintaining medical records in the normal course of medical practice, physical exams, reevaluations, and/or monitoring of the effectiveness of the opioids he prescribed.
The government alleges numerous examples where Padnes regularly prescribed the equivalent of over 1,000 milligrams of morphine per day to certain purported patients in exchange for cash. In one example, the government alleges that Padnes issued prescriptions for so many opioids to a patient that the patient would have needed to consume nearly 70 pills, the equivalent of 4,000 milligrams of morphine, every day. For reference, the Centers for Disease Control and Prevention’s guidance on opioid prescribing for chronic pain patients urges caution when patients are prescribed more than the equivalent of 50 milligrams of morphine per day and should usually not be prescribed greater than the equivalent of 90 milligrams of morphine every day. https://www.cdc.gov/mmwr/volumes/65/rr/rr6501e1.htm?CDC_AA_refVal=https%3A%2F%2Fwww.cdc.gov%2Fmmwr%2Fvolumes%2F65%2Frr%2Frr6501e1er.htm#recommendations
The government also alleges that Padnes violated the False Claims Act because Medicare and Medicaid paid to fill thousands of prescriptions that Padnes issued without a legitimate medical purpose, causing a loss to these programs exceeding $1 million.
The Controlled Substances Act provides for penalties for each prescription issued without a legitimate medical purpose up to $25,000 for violations on or before November 2, 2015 and up to $64,820 per violation after November 2, 2015. The False Claims Act allows for damages treble the government’s loss and civil penalties between $5,500 and $11,000 for each false claim presented on or before November 2, 2015 and between $11,181 and $22,363 for each false claim presented after November 2, 2015.
Civil Forfeiture of $1,864,545
On August 12, 2019, the United States filed a civil forfeiture complaint seeking the forfeiture of $1,864,545 cash seized from the defendant’s home during the execution of a search warrant in 2016. The government alleges that cash was the proceeds from Padnes’s unlawful medical practice from at least 2010 to 2016. The government alleges that, during that time, the vast majority of the defendant’s “patients” paid up to approximately $500 in cash for prescriptions for controlled substances, including Schedule II opioids such as oxycodone and methadone, that he wrote outside the usual course of medical practice and without a legitimate medical purpose. The cash was discovered in suitcases and a dresser located in a bedroom in the defendant’s home.
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“Our community continues to cope with the tragic and deadly consequences of the opioid epidemic,” said Acting United States Attorney Williams. “A small number of corrupt doctors put greed before their oath, abused their positions of trust, and fanned the flames of the epidemic by pumping untold millions of illicit opioid pills onto our streets without a legitimate medical purpose simply to enrich themselves. As this case demonstrates, we will bring the full force of the federal government to find, investigate, and prosecute such wrongdoing criminally and civilly,” said Williams. “To any prescriber who may be tempted to sell opioid prescriptions without a legitimate medical purpose, be warned: it is not worth it. We will find you, we will prosecute you, and we will make you pay,” said Williams.
Williams continued, “This parallel criminal and civil prosecution represents exceptional professionalism and teamwork of the Criminal, Civil, and Forfeiture units of this Office and our dedicated law enforcement partners over the course of this complex case. I wish to specifically commend the FBI, DEA, the Department of Health and Human Services, and the Internal Revenue Service for their investigative work,” said Williams.
“Dr. Padnes routinely prescribed dangerous amounts of opioids without any medical necessity in exchange for cash, making him no different than a drug dealer on the street,” said Thomas Hodnett, Acting Special Agent in Charge of the DEA’s Philadelphia Field Division. “I want to thank our partners at HHS, IRS, and the FBI; working together we were able to pursue criminal charges and civil violations against rogue doctors like Padnes that have contributed to the opioid epidemic.”
“As a consequence, for prescribing opioids without medical necessity, Mr. Padnes will be excluded from participating in the Medicare program for at least ten years,” said Maureen R. Dixon, Special Agent in Charge for the U.S. Department of Health and Human Services. “Working closely with our law enforcement partners and the criminal and civil divisions of the U.S. Attorney’s Office, HHS-OIG will continue to protect the integrity of government health care programs.”
“Today’s guilty plea sends a message to all professionals that no one is above their responsibility to pay taxes,” said Yury Kruty, Acting Special Agent in Charge, Philadelphia Field Office. “All income, legally or illegally earned, is taxable. IRS-Criminal Investigation will always work with our law enforcement partners and provide our financial expertise to stop individuals from illegally distributing controlled substances to the American public.”
“Stephen Padnes admits abusing his prescribing privileges for profit,” said Bradley S. Benavides, Acting Special Agent in Charge of the FBI’s Philadelphia Division. “Doctors willing to illegally distribute and prescribe opioids to enrich themselves only deepen the drug epidemic that continues to ravage our area. That’s why the FBI is so determined to shut down unscrupulous medical professionals engaged in drug diversion. I encourage the public to report any information about prescription abuse to us or our law enforcement partners.”
The investigation was conducted by the Philadelphia Field Division of the Drug Enforcement Administration, the U.S. Department of Health and Human Services, Office of Inspector General, Internal Revenue Service Criminal Investigation, and the Federal Bureau of Investigation Health Care Fraud Task Force, which includes agents from the FBI, Pennsylvania Attorney General’s Office, and HHS-OIG.
For the United States Attorney’s Office, the criminal case is being prosecuted by Assistant United States Attorney Jerome Maiatico, the civil Controlled Substances Act and False Claims Act matter was prosecuted by Assistant United States Attorney Charlene Keller Fullmer and former Assistant United States Attorney John T. Crutchlow, and the civil forfeiture matter is being prosecuted by Assistant United States Attorney Maria M. Carrillo.
Except for those facts admitted to in the guilty plea, the claims resolved by the civil settlements are allegations only, and there has been no determination of liability.
Cedar Rapids Man Pleads Guilty to Escape from Custody and Contempt of CourtRead the Press Release
A man who escaped from the Waterloo Residential Correctional Facility and later failed to appear in federal court pursuant to a subpoena pled guilty today in federal court in Cedar Rapids, Iowa.
Eugene Davis, age 43, from Cedar Rapids, Iowa, was convicted of an April 23, 2021 escape from federal custody at the Residential Correctional Center in Waterloo and for contempt of court by failing to appear in federal court on April 26, 2021, pursuant to a trial subpoena.
In a plea agreement, Davis admitted that he was in the Waterloo Residential Correctional Center in Waterloo, Iowa, on April 23, 2021, as a condition of his term of supervised release in a 2009 federal firearms case. On April 23, 2021, Davis left the facility to go to work and never returned. Davis was later arrested in Las Vegas, Nevada. Prior to Davis’s escape, he was served with a subpoena that required him to appear in federal court in Cedar Rapids on April 26, 2021. Davis never appeared in court as required.
Sentencing before United States District Court Chief Judge Leonard T. Strand will be set after a presentence report is prepared. Davis remains in custody of the United States Marshal pending sentencing. For the escape offense, Davis faces a possible maximum sentence of five years’ imprisonment, a $250,000 fine, and three years of supervised release following any imprisonment. For the contempt offense, Davis faces any term of imprisonment the Court finds appropriate in its discretion, a fine of not more than $250,000, and a term of supervised release of up to five years.
The case is being prosecuted by Assistant United States Attorney Patrick J. Reinert and was investigated by the United States Marshal’s Service. Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file numbers are CR-21-0041 (contempt of court) & CR-21-2042 (escape).
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Career Offender Sentenced to More than 11 Years in Prison for Multiple RobberiesRead the Press Release
BOSTON – A Lancaster man was sentenced yesterday in federal court in Worcester for committing three bank robberies.
Matthew Alden, 27, was sentenced by U.S. District Court Judge Timothy Hillman to 136 months in prison, three years of supervised release and ordered to pay restitution of $14,914. Due to prior convictions, including a 2018 robbery conviction, Alden was sentenced as a career offender. In December 2020, Alden pleaded guilty to three counts of bank robbery.
On Dec. 12, 2019, Alden robbed the Cornerstone Bank on South Main Street in Leicester, stealing $9,906 and fleeing the scene. On Dec. 27, 2019, Alden robbed the Avidia Savings Bank on Maple Street in Marlborough, stealing $3,980 before fleeing the scene. Alden later robbed the Avidia Bank on Maple Avenue in Shrewsbury on Feb. 21, 2020, stealing $1,028. A few hours later, a gas station surveillance camera caught Alden purchasing items inside of the gas station. In addition, video surveillance from a nearby location depicted Alden near the vicinity of the bank the day before, looking at video cameras.
Alden was arrested on Feb. 26, 2020. A search of Alden’s phone revealed photos of Alden wearing clothing that was worn during the robberies as well as multiple photos of quantities of cash. For example, on Dec. 12, 2020, the same day as the Leicester bank robbery, Alden took a photo inside of his vehicle holding a large sum of cash. Metadata showed that the photo was taken approximately 14 minutes after the robbery occurred. In addition, the defendant wrote himself notes on his phone, including the address of the Shrewsbury bank and reminders to throw away clothing at the Salvation Army. Evidence confirmed that Alden went to the Salvation Army in January 2020 and a consignment store after the Shrewsbury robbery. At the time of his arrest, Alden was holding a notepad, with a list of 12 banks in Massachusetts and New Hampshire that he had not yet robbed, along with notes such as, “TD open until 7 on Friday check to see rear.” A search of Alden’s house recovered, among other items, several articles of clothing identical to those worn during the robberies.
Acting United States Attorney Nathaniel R. Mendell and Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division made the announcement. Assistance was provided by the Massachusetts State Police and the Westford, Athol, Lunenberg, Leicester, Marlborough, Framingham, Foxborough, Shrewsbury, Millbury, Lancaster and Nashua (N.H.) Police Departments. Assistant U.S. Attorney Lucy Sun of Mendell’s Worcester Branch Office prosecuted the case.
California Man Pleads Guilty for Role in Eastern Oregon Methamphetamine Trafficking ConspiracyRead the Press Release
PORTLAND, Ore.—A Vacaville, California man pleaded guilty today for his role in a conspiracy to traffic large quantities of methamphetamine from California for distribution in Northeast Oregon and Southeast Washington.
Noel Lomas Murillo, 33, pleaded guilty to conspiring to possess with intent to distribute and distribute methamphetamine.
According to court documents, in November 2017, the Blue Mountain Enforcement Narcotics Team (BENT), Oregon State Police (OSP), and the FBI began investigating a drug trafficking organization led by Murillo’s brother, Abel Lomas Murillo, 28, of Weston, Oregon.
The investigation revealed that as early as July 2017, Noel Murillo transported drugs from Vacaville to Klamath Falls, Oregon where a courier would deliver them to his brother. Abel Murillo also made multiple trips to Medford, Oregon to pick up drugs and transport them to Morrow and Umatilla Counties for distribution.
In January 2018, an OSP trooper stopped one of the Murillo brothers’ couriers, Luis Alberto Navarro, 33, of Boardman, Oregon, in a vehicle traveling near Klamath Falls en route to Umatilla County. A search of the vehicle revealed 11 concealed packages containing more than eight kilograms of methamphetamine.
In early May 2018, as the investigation continued, Abel Murillo enlisted another courier, Noel Ponce Villegas, 28, also of Boardman, to drive methamphetamine from Medford to Boardman. Investigators surveilled Abel Murillo as he traveled from Umatilla County to a storage locker in Medford and loaded a trailer pulled by his truck. Abel Murillo paid Villegas to drive his truck and trailer while he followed him to minimize his own risk. In the early morning hours of May 6, 2018, investigators from BENT, OSP and FBI stopped Abel Murillo and Villegas as they drove near mile marker 102 on Interstate 84.
Investigators seized 42 packages of methamphetamine, 36 of which were concealed in the false bottom of a propane tank. The packages contained approximately 17.6 kilograms of methamphetamine. Later the same day, investigators executed a search warrant at Abel Murillo’s residence, seizing 29 firearms and body armor. Pursuant to a separate search warrant, another 10 pounds of methamphetamine and five firearms were found in a Medford storage locker Abel Murillo had visited earlier in the weekend.
On December 19, 2019, a federal grand jury in Portland returned a two-count superseding indictment charging Noel Murillo with conspiring to possess with intent to distribute and distribute methamphetamine and possessing with intent to distribute methamphetamine.
Noel Murillo will be sentenced on January 5, 2022 before U.S. District Court Judge Michael H. Simon.
On May 7, 2018, Navarro pleaded guilty to possessing with intent to distribute methamphetamine. He will be sentenced on February 1, 2022.
On April 15, 2019, Abel Murillo pleaded guilty to conspiring to possess with intent to distribute methamphetamine. On September 10, 2019, he was sentenced to 235 months in federal prison and five years’ supervised release.
On April 18, 2019, Villegas pleaded guilty to possessing with intent to distribute methamphetamine. On December 16, 2020, he was sentenced to time served and three years’ supervised release.
Acting U.S. Attorney Scott Erik Asphaug of the District of Oregon made the announcement.
This case was investigated by BENT, OSP, and the FBI. It is being prosecuted by the U.S. Attorney’s Office for the District of Oregon.
Cabarrus County Man Sentenced for Distribution and Production of Child PornographyRead the Press Release
GREENSBORO – A North Carolina man was sentenced on September 28, 2021, to 600 months in prison, followed by a lifetime term of supervised release, for production and distribution of child pornography.
Adam Chase Wallace, 25, was indicted by superseding indictment in February, 2021, on four counts of production of child pornography, one count of distribution of child pornography, and one count of possession of child pornography. He later pleaded guilty to one count of both production and distribution on May 20, 2021.
According to court documents, Homeland Security Investigations (HSI) Newark notified Special Agents with HSI Charlotte that they received information from an individual regarding a contact he knew as “Adam” who was filming himself abusing two minors and producing and sharing illegal content. An undercover agent continued communicating with the individual and gathered evidence that Wallace was producing and distributing child pornography. Using social media account information, verified through commercial and law enforcement databases, Special Agents identified Wallace as the likely perpetrator and executed a search warrant for his electronic devices. A computer forensic expert located more than one thousand images of child pornography on Wallace’s devices, including images he produced with the two minors. Wallace admitted to producing images and videos of his abuse to law enforcement shortly after his arrest.
"Finding and arresting perpetrators, like Wallace, that prey upon innocent children is a crucial part of our mission to protect the homeland," said Special Agent in Charge Ronnie Martinez, who oversees Homeland Security Investigations (HSI) operations in North Carolina and South Carolina. “HSI and its law enforcement partners will continue to target these predators and bring them to justice."
This case was investigated by Homeland Security Investigations and was prosecuted by Assistant U.S. Attorney Kennedy Gates and Assistant U.S. Attorney Nicole R. DuPre.
The case is part of Project Safe Childhood, a nationwide initiative by the Department of Justice to combat online child sexual exploitation and abuse. The initiative is led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), and focuses on coordinating federal, state, and local resources to better identify and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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Burlington County Man Sentenced to 10 Years in Prison for Conspiring to Distribute Large Amounts of Heroin and Cocaine in CamdenRead the Press Release
CAMDEN, N.J. – A Burlington County, New Jersey, man was sentenced today to 120 months in prison for conspiring to distribute heroin and cocaine in Camden, Acting U.S. Attorney Rachael A. Honig announced.
Dwight Williams, 20, of Mount Holly, New Jersey, previously pleaded guilty before U.S. District Judge Renee Marie Bumb in Camden federal court to a superseding information charging him with conspiracy to distribute 100 grams or more of a mixture or substance containing heroin, as well as a mixture and substance containing cocaine. During his sentencing hearing, Williams agreed that the amount of heroin jointly attributable to him, as a member of the conspiracy, was three to 10 kilograms.
According to documents filed in this case and statements made in court:
A total of 19 defendants were arrested in late 2018 on drug-trafficking charges based on the FBI’s investigation of a drug-trafficking organization that ran the open-air narcotics trade on the 400-500 block of Pine Street in Camden for several months in 2018. The investigation used various investigative tactics including video surveillance, confidential informants, consensual recordings, controlled drug purchases, and several court-authorized wiretaps to uncover the inner workings of the drug-trafficking organization. The organization included street-level sellers who worked various shifts on the “drug set,” selling drugs to customers and collecting drug proceeds. The street-level sellers were supervised by different layers of managers who, in turn, supplied the drug set with pre-packaged heroin, some of which was mixed with fentanyl, as well as cocaine and crack cocaine. The FBI and other law enforcement officers recovered multiple firearms from different locations connected to the drug organization at the time of the 2018 arrests.
Sixteen of these defendants already have pleaded guilty to drug conspiracy charges before Judge Bumb in the United States District Court. Three defendants are awaiting trial, and the charges and allegations against those three defendants are merely accusations, and they are presumed innocent unless and until proven guilty.
In addition to the prison term, Judge Bumb sentenced Williams to five years of supervised release.
Acting U.S. Attorney Rachael A. Honig credited special agents of the FBI’s South Jersey Violent Offender and Gang Task Force, South Jersey Resident Agency, under the direction of Special Agent in Charge Bradley S. Benavides; the Camden County Police Department, under the direction of Chief Gabriel Rodriguez; the Camden County Prosecutor’s Office, under the direction of Acting Prosecutor Jill S. Mayer; the Camden County Sherriff’s Department, under the direction of Sheriff Gilbert L. Wilson; the Cherry Hill Police Department, under the direction of Chief William P. Monaghan; and the N.J. State Police, under the direction of Col. Patrick J. Callahan, with the investigation leading to today’s sentencing. She also thanked the Drug Enforcement Administration, the U.S. Marshals Service, and the Department of Homeland Security for their assistance.
This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
The government is represented by Assistant U.S. Attorneys Sara Aliabadi and Patrick C. Askin of the U. S. Attorney’s Office Criminal Division in Camden.
Bronx Man Admits Identity Fraud and Laundering over $6.5 Million in Illegal Drug ProceedsRead the Press Release
NEWARK, N.J. – A Bronx, New York, man today admitted his role in a large international money laundering conspiracy and using a stolen identity in furtherance of the scheme, Acting U.S. Attorney Rachael Honig announced.
Orlando Delgado, 31, pleaded guilty by videoconference before U.S. District Judge Katharine S. Hayden to an information charging him with one count of conspiracy to commit money laundering and one count of identity fraud.
According to documents filed in this case and statements made in court:
From August 2018 through December 2019, Delgado laundered over $6.5 million in cash drug proceeds on behalf of a large-scale money laundering organization with close ties to drug trafficking organizations in the Dominican Republic and elsewhere. Delgado accepted large amounts of cash drug proceeds and laundered it by purchasing over 390 cashier’s checks at local bank branches in New Jersey, New York, and Florida. The checks were made payable to individuals and companies specified by the leaders of the money laundering organization. By converting the drug proceeds to cashier’s checks, Delgado tried to hide the source of the illegal cash and avoid scrutiny by law enforcement and banks.
In August 2019, Delgado obtained a fraudulent identification card in someone else’s name and used it to open multiple bank accounts, which he then used to purchase over $1.5 million in cashier’s checks with cash drug proceeds.
The charge of money laundering conspiracy carries a maximum penalty of 10 years in prison and a fine of $250,000 or twice the amount involved in the offense, whichever is greater. The charge of identify fraud carries a maximum prison sentence of five years and a $250,000 fine. Sentencing is scheduled for Feb. 8, 2022.
Acting U.S. Attorney Honig credited special agents and task force officers of the U.S. Drug Enforcement Administration, New Jersey Division, under the direction of Special Agent in Charge Susan A. Gibson, and the New York Division, under the direction of Special Agent in Charge Raymond Donovan; special agents and task force officers of IRS - Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez; the Morristown, New Jersey, police department, under the direction of Acting Police Chief Darnell Richardson; and the Direccion Nacional de Control de Drogas (the Dominican Republic National Drug Directorate, “DNCD”) with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Jonathan M. Peck of the Criminal Division in Newark.
This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
Berkeley County woman admits to drug chargesRead the Press Release
MARTINSBURG, WEST VIRGINIA – Felicia Johnson, of Martinsburg, West Virginia, has admitted to a drug charge, Acting United States Attorney Randolph J. Bernard announced.
Johnson, 34, pleaded guilty today to one count of “Possession with Intent to Distribute Cocaine Hydrochloride.” Johnson admitted to having cocaine hydrochloride in February 2021 in Berkley County.
Johnson faces up to 20 years of incarceration and a fine of up to $1,000,000 for each count. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Lara Omps-Botteicher is prosecuting the case on behalf of the government. The FBI; U.S. Marshals Service, Homeland Security Investigations; the Bureau of Alcohol, Tobacco, Firearms & Explosives; The Drug Enforcement Administration; the West Virginia Air National Guard, the Eastern Panhandle Drug Task Force, a HIDTA-funded initiative (agencies included are the West Virginia State Police, Berkeley County Sheriff’s Department, Jefferson County Sherriff’s Department, Ranson Police Department, Charles Town Police Department, and Martinsburg City Police Department); West Virginia State Police; Customs and Border Protection; the Hagerstown Police Department; the National Resources Police Department; FBI-New York Safe Streets Task Force; the New York Police Department; the New Jersey State Police; the Washington County (Maryland) Drug Task Force; the Maryland State Police; the U.S. Attorney’s Office for the District of Maryland; and the U.S. Attorney’s Office for the Middle District of Pennsylvania investigated.
U.S. Magistrate Judge Robert W. Trumble presided.
Armed Bowie Narcotics Trafficker Pleads Guilty and is Sentenced to Eight Years in Federal Prison for Conspiracy to Distribute Five Kilograms of CocaineRead the Press Release
Baltimore, Maryland – U.S. District Judge Deborah K. Chasanow sentenced Dwayne Douglas, age 39, of Bowie, Maryland, to eight years in federal prison followed by four years of supervised release for being a member of a conspiracy to distribute and possession with the intent to distribute five kilograms of cocaine.
The guilty plea and sentence were announced by Acting United States Attorney for the District of Maryland Jonathan F. Lenzner; Assistant Special Agent in Charge Orville O. Greene of the Drug Enforcement Administration, Baltimore District Office (DEA); Special Agent in Charge James R. Mancuso of Homeland Security Investigations (HSI) Baltimore; Postal Inspector in Charge Daniel A. Adame of the U.S. Postal Inspection Service - Washington Division (USPIS); Lieutenant Colonel Kevin M. Anderson, Chief of the Maryland Transportation Authority Police (MDTA Police); Chief Melissa R. Hyatt of the Baltimore County Police Department (BCPD); and Chief Marcus Jones of the Montgomery County Police Department (MCPD).
“Our law enforcement team here in Maryland is focusing on individuals and groups who are driving the violence and bringing large quantities of narcotics into our communities,” said Acting United States Attorney Jonathan Lenzner. “As a large-scale narcotics dealer who also illegally possessed firearms, Dwayne Douglas endangered communities in our state. I would like to commend and thank the local, state and federal law enforcement agencies who worked together to hold accountable Douglas and other members of the conspiracy.”
According to his guilty plea, in furtherance of the narcotics conspiracy, Douglas met with co-conspirators on several occasions. In one meeting, Douglas transferred drug proceeds directly to an individual who unbeknownst to Douglas was a confidential informant (CI). In order to conduct the transactions, the CI would call a third party to arrange the transfer and a code would be assigned. Thereafter, the CI would meet Douglas and, after Douglas received the code from the CI, Douglas would transfer the drug proceeds to the CI.
Specifically, in October 2016, Douglas delivered approximately $250,000 in narcotics to a CI in a Bowie, Maryland hotel parking lot. In March 2017, Douglas delivered approximately $149,960 to a CI in the parking lot of a College Park, Maryland restaurant.
Additionally, in November 2016, a CI received a notification and the description of a vehicle that would transfer drug proceeds and gave that description to law enforcement. Law enforcement then conducted a traffic stop of the vehicle, in the vicinity of Hyattsville, Maryland. Douglas was the driver of the vehicle. During the car stop, law enforcement observed an open box in the back passenger seat filled of U.S. Currency. Douglas informed law enforcement that there was “a lot” of money in the car. Following a positive canine sniff, law enforcement searched the vehicle and recovered a total of $158,609.
One day later, law enforcement executed a federal search warrant in which Douglas was the target in Lanham, Maryland. As a result of the search warrant, law enforcement recovered numerous items including a scale with cocaine residue, Douglas' personal items, and a loaded semi-automatic pistol. A federal search and seizure warrant was authorized the next month for Douglas’ DNA. DNA found on the firearm was compared to Douglas’ DNA and the chances of an individual other than Douglas being the DNA contributor was one in 7.24 octillion. The DNA that matched Douglas was found on the grip and trigger of the firearm.
As stated in his plea agreement, on July 28, 2020, investigators executed federal search and seizure warrant on Douglas’ Silver Spring, Maryland apartment. Investigators recovered a pistol loaded with 14 rounds of ammunition, 10 rounds of .45 caliber bullets, two magazines, four separate boxes of ammunition, more than 10 cellular phones, a money counter machine, a food-saver heat sealer machine, packaging materials for controlled substances, latex gloves and three digital scales. Within a safe, DEA agents recovered approximately $25,241.00. DEA agents arrested Douglas, who was inside his apartment.
In his plea agreement, Douglas agrees that it was reasonably foreseeable to him that the conspiracy distributed five kilograms or more of cocaine. Douglas further admits and agrees that he possessed the two above-described firearms even though he was prohibited from doing so due to a prior felony conviction.
This case is part of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
The overdose crisis continues to devastate our states and local communities. If you believe you may need substance use disorder treatment or recovery services, please call 1800-662-HELP (4357). You may also visit the United States Attorney’s Office for the District of Maryland for further information and resources on opioid awareness at /media/1138691/dl?inline.
Acting United States Attorney Jonathan F. Lenzner commended the DEA, HSI, the MDTA Police, the BCP, U.S. Postal Inspectors, and the MCPD for their work in the investigation. Mr. Lenzner thanked Assistant U.S. Attorneys James Warwick and Zachary B. Stendig, who prosecuted the case.
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6 Physical Therapists and 2 Acupuncturists Charged in over $20 Million Health Care Fraud SchemeRead the Press Release
Audrey Strauss, the United States Attorney for the Southern District of New York, and Scott Lampert, Special Agent in Charge of the New York Office of the U.S. Department of Health and Human Services, Office of Inspector General (“HHS-OIG”), announced the unsealing today of an indictment charging acupuncturists JUNYI LIU, a/k/a “Jenny,” and HONGXING WANG, as well as physical therapists GLEEN ANCIRO, NOEMI ALGODON, MOHAMED ELMANDOUH, GERARD ESTRELLA, RAMON GARCIA III, and HENLER DATU TAHIL, and cashier ZIHAO CHEN with operating an over $20 million health care fraud scheme at fraudulent medical offices in Manhattan, Brooklyn, and Queens. As part of the fraud scheme, CHEN and other of the defendants’ co-conspirators paid cash kickbacks to patients (the “Paid Patients”) who were insured by Medicare and/or other insurance providers (collectively, the “Insurance Providers”), and the defendants and their co-conspirators then billed Medicare and the insurance providers for physical therapy and acupuncture services related to the Paid Patients that were unnecessary or never performed. LIU was additionally charged with unlawfully enriching herself and a family member through a COVID-19 unemployment benefit scheme.
The defendants were arrested earlier today and will be presented this afternoon before U.S. Magistrate Judge Gabriel W. Gorenstein. The case is assigned to Chief U.S. District Judge Laura Taylor Swain.
U.S. Attorney Audrey Strauss said: “As alleged, the defendants perpetrated a multimillion-dollar health care fraud scheme in which they billed Medicare and other insurers for physical therapy and acupuncture services that were either not rendered in the manner purported or not rendered at all. Large-scale insurance frauds of the type alleged here impose hidden but very real costs on the public as well as insurers. Thanks to our partners in this case, the defendants are in custody and facing serious federal charges.”
HHS Special Agent in Charge Scott Lampert said: “These allegations describe a greed-fueled scheme that undermined our health care system and the people it serves. Health care providers participating in the Medicare program are trusted to furnish medically necessary services and to make beneficiaries collaborators in their care, not conspirators in fraud. HHS-OIG and our law enforcement partners proudly work to protect federal health care funds by identifying and quelling fraudulent billing of providers.”
According to the allegations contained in the Indictment[1] and statements made during court proceedings:
Between 2018 and 2021, LIU, a licensed acupuncturist, operated medical offices (the “Offices”) from which LIU and her partners fraudulently billed the Insurance Providers for physical therapy and acupuncture services that were not rendered in the manner represented or not rendered at all. During the scheme, LIU partnered with other licensed medical professionals, including ANCIRO, ALGODON, ELMANDOUH, ESTRELLA, GARCIA, and TAHIL, all of whom were licensed physical therapists, and WANG, who was a licensed acupuncturist (collectively, the “Partners”). The Partners’ roles in the scheme typically included: (i) allowing the Offices to use their enrollments with the Insurance Providers to submit to the Insurance Providers materially false and fraudulent claims for reimbursement for physical therapy and acupuncture services that were not rendered in the manner represented or were not rendered at all; (ii) creating materially false medical documentation, which stated that certain physical therapy and acupuncture services had been rendered, when such services in fact were not rendered in the manner represented or were not rendered at all; and (iii) contributing financing for the Offices, including for the payment of cash kickbacks to the Paid Patients to induce those patients to provide their insurance information and receive medically unnecessary and/or non-existent services at the Offices. LIU and certain of the Partners also agreed to give kickbacks, including cash and expensive wine, to employees of Insurance Providers to enable the scheme to continue.
In furtherance of the scheme, LIU employed receptionists, cashiers, marketers, financial and billing personnel, acupuncturists, massagists, and other personnel. The cashiers included CHEN, who on numerous occasions distributed tens of thousands of dollars in cash kickbacks to the Paid Patients. In some instances, these Paid Patients visited the Offices, signed in, and received unnecessary physical therapy and acupuncture services. In other instances, the Paid Patients visited the Offices, signed a sign-in sheet and other documents, and then left without receiving any services at all. In yet other instances, the Paid Patients did not visit the Offices at all and instead signed sign-in sheets and other documents brought to them elsewhere. Regardless of whether the Paid Patients received any services or even visited the Offices at all, the Partners used the Paid Patients’ insurance information to fraudulently bill the Insurance Providers for unnecessary and/or never rendered services.
While LIU and her Partners were defrauding the Insurance Providers of millions of dollars, from April 2020 through September 2021, LIU also engaged in a scheme to obtain COVID-19 unemployment benefits for herself and a family member (the “Family Member”) by fraudulently submitting and causing to be submitted to the New York Department of Labor materially false online applications and certifications for COVID-19 benefits. Among other things, the applications and/or certifications represented that LIU was unemployed when, in fact, she continued to operate the Offices for all or nearly all of this period, and that LIU’s Family Member was unable to work because of COVID-19 during a five-month period when the Family Member was in China.
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JUNYI LIU, 67, of Great Neck, New York, GLEEN ANCIRO, 50, of Floral Park, New York, NOEMI ALGODON, 49, of Mineola, New York, MOHAMED ELMANDOUH, 48, of Staten Island, New York, GERARD ESTRELLA, 39, of West Hempstead, New York, RAMON GARCIA III, 39, of Merrick, New York, HENLER DATU TAHIL, 38, of East Meadow, New York, HONGXING WANG, 61, of Brooklyn, and ZIHAO CHEN, 20, of Queens, are each charged with: (1) conspiring to commit health care fraud, which carries a maximum sentence of 20 years in prison; (2) conspiring to violate the Anti-Kickback Statute, which has a maximum penalty of five years in prison; and (3) conspiring to commit money laundering, which carries a maximum sentence of 20 years in prison. LIU is also charged with wire fraud, which has a maximum penalty of 20 years in prison, and theft of Government funds, which has a maximum penalty of 10 years in prison.
The statutory maximum sentences are prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendants would be determined by the judge.
Ms. Strauss praised the outstanding investigative work of HHS-OIG’s New York Office and the New York Field Office of the Internal Revenue Service, Criminal Investigation. Ms. Strauss also thanked the New York State Attorney General’s Medicaid Fraud Control Unit and the U.S. Department of Labor, Office of Inspector General, for their assistance.
The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorney Timothy V. Capozzi is in charge of the prosecution.
The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth in this release constitute only allegations, and every fact described should be treated as an allegation.
10 People Indicted in Scheme to “Straw Purchase” FirearmsRead the Press Release
DETROIT – Ten individuals have been indicted on charges involving the alleged straw purchasing of firearms, announced Acting United States Attorney Saima Mohsin. The indictment is part of the Department of Justice’s Project Safe Neighborhoods Initiative aimed at reducing gun violence.
Mohsin was joined in the announcement by Acting Special Agent in Charge Keith Krolczyk, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).
Project Safe Neighborhoods (PSN) is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is a comprehensive approach to combating gun violence by bringing together local, state and federal law enforcement officials, prosecutors, and community leaders to implement a multi-faceted strategy to deter and punish gun violence from all sides. PSN focuses enforcement efforts on the most violent offenders as well as those who seek to circumvent gun laws put in place to protect the public, otherwise known as “straw purchasers”.
A “straw purchase” is an illegal firearm purchase where the actual buyer of the gun, being unable to pass the required federal background check or desiring to not have his or her name associated with the transaction, uses another person who can pass the required background check to purchase the firearm for him/her. Those who purchase firearms in this illegal manner are subject to 10 years in prison and a $250,000 fine.
Charged today were:
Chauncey Williams, 21, Detroit, MI
Mike Chahoua, 23, Sterling Heights, MI
Antonio Jackson, 22, Detroit, MI
Bishop Allen, 24, Detroit, MI
Garcia Moses, 24, currently residing in Florida
Donte Turner, 26, Detroit, MI
Reginald Small, 23, Detroit, MI
Eshon Rose, 22, Detroit, MI
James Jackson, 23, Detroit, MI
Emmanuel Stevens, 21, Detroit, MI
As alleged in the indictment, beginning in November 2020 and continuing through March 2021, defendants Chauncey Williams, Michael Chahoua and Antonio Jackson used stolen credit card information to purchase firearms from online retailers and enlisted seven straw purchasers to retrieve the firearms in-person from a local federal firearms licensee in exchange for compensation. The straw purchasers allegedly made false statements stating that they were the actual purchaser of the firearms. Once in receipt of the illegally obtained firearms, Williams, Chahoua and Jackson either personally possessed and used the firearms or resold the firearms for profit. In total, at least 40 firearms were illegally obtained through this scheme. At least three of the firearms were recovered from convicted felons.
Six of the ten defendants have been arrested and will be appearing in federal court this afternoon for their arraignment.
“When you buy a gun for someone who is legally prohibited from possessing a firearm, you could be buying yourself 10 years in federal prison,” said Acting US Attorney Mohsin. “The surge of gun violence in our cities is being fueled by individuals who circumvent the law and supply firearms to felons and trigger-pullers. These cases should send a message to those thinking about straw purchasing firearms – you will be subject to federal prosecution.”
“Straw purchasing is not a victimless crime. The act of knowingly enabling a prohibited person to purchase a firearm puts firearms in the hands of criminal organizations and violent criminals presenting a grave threat to the safety of our communities,” said Acting Special Agent in Charge Keith Krolczyk.
The United States Attorney’s Office and the ATF are focused on prosecuting those individuals who are putting guns in the hands of criminals only to be used in an untold number of violent crimes. This indictment is the latest in a string of charges brought during the last year involving the straw purchase of firearms. In the last year, the USAO has obtained 13 indictments, charging 25 different individuals for their involvement in straw purchases of more than 74 firearms. Some of those firearms were involved in shootings or found in the hands of felons. Some of those cases include:
On August 18, 2021, two individuals were indicted for making straw purchases of at least 10 firearms during a one-month period. Two of those firearms were later recovered by law enforcement at crime scenes in the City of Detroit.
On March 3, 2021, three individuals were indicted for their involvement in selling five firearms to an undercover agent between December 2020 and January 2021. Agents then conducted NIBIN (National Integrated Ballistic Information Network) testing on the firearms and two of the guns sold to the undercover agent were traced to prior shootings into homes in Detroit from the fall of 2020.
Also indicted on March 3, 2021 was Danny Jo Thompson, II. Thompson acted as a straw purchaser for a person he knew to be a convicted felon. Specifically, Thompson purchased two AR-15 lower receivers (classified as a firearm under federal law) and worked with the convicted felon to convert two semi-automatic AR-style rifles into fully functioning machine guns. The machine gun possessed by the convicted felon was later found in the felon’s truck at the scene of a shootout with law enforcement.
These charges are just some of the tangible results of this joint effort. The United States Attorney’s Office and our law enforcement partners will continue to work together to reduce gun violence in our communities.
An indictment is not evidence of guilt. Defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
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27 September 2021
“R. Kelly” Convicted of All Counts by a Federal Jury in BrooklynRead the Press Release
Robert Sylvester Kelly, the R&B singer also known as “R. Kelly,” was convicted today by a federal jury in Brooklyn of all nine counts of a superseding indictment charging him with racketeering predicated on criminal conduct including sexual exploitation of children, forced labor and Mann Act violations involving the coercion and transportation of women and girls in interstate commerce to engage in illegal sexual activity. The verdict followed six weeks of trial before United States District Judge Ann M. Donnelly.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, and Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), announced the verdict.
“Today’s guilty verdict forever brands R. Kelly as a predator, who used his fame and fortune to prey on the young, the vulnerable, and the voiceless for his own sexual gratification,” stated Acting U.S. Attorney Kasulis. “A predator who used his inner circle to ensnare underage teenage girls, and young women and men, for decades, in a sordid web of sex abuse, exploitation and degradation. To the victims in this case, your voices were heard, and justice was finally served. We hope that today’s verdict brings some measure of comfort and closure to the victims.” Ms. Kasulis also thanked the U.S. Attorney’s Office for the Northern District of Illinois and the Cook County State’s Attorney’s Office for their assistance with the case.
“Robert Kelly is a serial sexual predator who used his fame and musical tours as his personal hunting grounds to find his victims,” stated HSI Special Agent-in-Charge Fitzhugh. “Mr. Kelly ran a criminal enterprise whose mission was to serve his sexual gratification by setting up a complex organization of enablers and handlers. When his victims tried to escape, Mr. Kelly and his accomplices silenced them through bribery, intimidation, and physical violence. The brave survivors who overcame Mr. Kelly’s abuse deserve our upmost respect for telling their stories and bringing an end to his 30-year reign of terror over the young and vulnerable.”
As proven at trial, for nearly three decades, Kelly was the leader of a criminal enterprise (“the Enterprise”) consisting of himself and an entourage of individuals who served as managers, bodyguards, accountants, drivers, personal assistants and runners for the defendant. As the leader of the Enterprise, Kelly used his fame to recruit women and girls to engage in illegal sexual activity with him. Kelly identified these girls and women at concerts, and then directed members of the Enterprise to escort them backstage following his musical performances. Kelly exchanged contact information with girls and women so that he and other members of the Enterprise could arrange travel and lodging for them to visit Kelly and engage in the charged illegal sexual conduct.
The evidence at trial included the testimony 45 government witnesses, including more than 10 victims, five of whom are named in the superseding indictment, testimony from employees of the defendant, text messages, video and audio recordings, photographs, phone and travel records, DNA evidence and expert witnesses.
Kelly issued rules that many of his sexual partners were required to follow, including that the women and girls were to call him “Daddy”; they were not permitted to leave their rooms to eat or visit the bathroom without receiving his permission; they were required to wear baggy clothing when not accompanying Kelly to an event; and they were directed to keep their heads down and not look at or speak to other men. Kelly also isolated the women and girls from their friends and family and made them dependent on him for their financial well-being. He required the victims to engage in sex with him and others, and recorded many of the sexual encounters.
Racketeering Act One – Bribery
Kelly bribed a state employee to create an identification card for Jane Doe #1, then 15 years old, so that Kelly could marry Jane Doe #1 because he believed she was pregnant and therefore the marriage could keep him out of jail.
Racketeering Acts Two, Seven and Ten – Sexual Exploitation of a Child – Jane Doe #2, Jane Doe #4 and Jane Doe #5
Kelly coerced Jane Doe #2, Jane Doe #4 and Jane Doe #5 to engage in sexually explicit conduct for the purpose of producing video recordings. Over the course of decades, he made these recordings, and other recordings of sexually explicit conduct, using VHS video cameras, Canon camcorders, iPhones and iPads.
Racketeering Acts Six, Eleven and Thirteen – Forced Labor – Jane Doe #4, Jane Doe #5 and Jane Doe #6
Kelly used the threat of physical harm and physical restraint to ensure that his victims, including Jane Doe #4, Jane Doe #5 and Jane Doe #6, performed sexually at his command. As to Jane Doe #4, he slapped her, choked her and spit on her, before demanding she give him oral sex. As to Jane Doe #5, over a period of years, he spanked her, viciously assaulted her, confined her for periods of days and otherwise manipulated her, to ensure that she would perform for him sexually, including with other women and a man. As to Jane Doe #6, he forced her to give him oral sex. When he did that, there was a gun within Kelly’s reach.
Racketeering Acts Five and Nine – Mann Act Violations – Jane Doe #4 and Jane Doe #5
Between May 2009 and January 2010, Kelly regularly spoke with Jane Doe #4 over the telephone to arrange for Jane Doe #4 to come to his residence in Olympia Fields for the purpose of illegal sexual activity, which was illegal because Jane Doe #4 was too young to consent to sex in Illinois. Similarly, between September 2015 and October 2015, Kelly transported Jane Doe #5, who was then 17 years old, from New York City to Oakland, California for the purpose of illegal sexual activity, as she was too young to consent to sex in California.
Racketeering Acts Eight, Thirteen and Fourteen – Mann Act Violations – Jane Doe #5 and Jane Doe #6
In April 2015, Kelly arranged for Jane Doe #5 to fly from her home in Orlando, Florida, to Los Angeles, California, for the purpose of illegal sexual activity, which was illegal because Kelly knew he had an incurable sexually transmitted disease (“STD”) and did not inform Jane Doe #5 about the STD prior to engaging in sexual intercourse with her. In May of 2017 and again in February of 2018, Kelly arranged for Jane Doe #6 to fly from her home in San Antonio, Texas, to La Guardia Airport in Queens, New York, for the purpose of illegal sexual activity, which again was illegal because Kelly failed to disclose that he had an incurable STD and obtain Jane Doe #6’s consent to engage in sexual intercourse under those circumstances.
When sentenced, Kelly faces a mandatory minimum sentence of 10 years’ imprisonment and up to life in prison.
The government’s case is being handled by the Office’s Civil Rights Section. Assistant United States Attorneys Elizabeth Geddes, Nadia Shihata and Maria Cruz Melendez are in charge of the prosecution.
The Defendant:
ROBERT SYLVESTER KELLY (also known as “R. Kelly”)
Age: 54
Chicago, IllinoisE.D.N.Y. Docket No. 19-CR-286 (AMD)
Worcester Man Pleads Guilty to Firearms ChargesRead the Press Release
BOSTON – A Worcester man pleaded guilty today in connection with brandishing a loaded sawed-off shotgun in an apartment while arguing with teenaged residents in December 2019.
Steven Dillon, 36, pleaded guilty to one count of being a felon in possession of a firearm and ammunition and one count of unlawful possession of an unregistered firearm. U.S. District Court Judge Timothy S. Hillman scheduled sentencing for Jan. 10, 2022. Dillon was indicted in June 2020.
On Dec. 25, 2019, Dillon brandished a loaded sawed-off shotgun in an apartment while arguing with teenaged residents. Police found the shotgun and ammunition in a bedroom used by Dillon, who was previously convicted of a felony punishable by more than one year in prison and therefore prohibited from possessing a firearm.
The charging statute provides for a sentence of up to 10 years in prison, three years of supervised release and a fine of $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney Nathaniel R. Mendell; James Ferguson, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms & Explosives, Boston Field Division; and Worcester Police Chief Steven M. Sargent made the announcement today. Assistant U.S. Attorney Kristen Noto of Mendell’s Worcester Branch Office is prosecuting the case.
Waterloo Woman Headed to Federal Prison for Drug TraffickingRead the Press Release
A woman who admitted conspiring with others to sell methamphetamine was sentenced September 24, 2021, to nearly four years in federal prison.
Jennifer Marie Klingsmith, age 36, from Waterloo, Iowa, received the prison term after a March 15, 2021 guilty plea to conspiracy to distribute a controlled substance.
At the guilty plea, Klingsmith admitted she conspired with others beginning around November 2019 through February 2020 to distribute methamphetamine. Klingsmith admitted selling methamphetamine to two other people. Overall, Klingsmith was involved in trafficking more than 200 grams of methamphetamine.
Klingsmith was sentenced in Cedar Rapids by United States District Court Judge C.J. Williams. Klingsmith was sentenced to 46 months’ imprisonment. She must also serve a five-year term of supervised release after the prison term. There is no parole in the federal system.
Klingsmith is being held in the United States Marshal’s custody until she can be transported to a federal prison.
The case was prosecuted by Special Assistant United States Attorney Alex Geocaris and Assistant United States Attorney Emily K. Nydle and investigated by the Tri-County Drug Enforcement Task Force, the Waterloo Police Department, the Black Hawk County Sheriff’s Office, the Cedar Falls Police Department, the Federal Bureau of Investigation, and the Bureau of Alcohol, Tobacco, Firearms, and Explosives.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 20-cr-2046.
Follow us on Twitter @USAO_NDIA.
Vermont Resident Charged with Illegally Buying Firearm for Plattsburgh FelonRead the Press Release
The Office of the United States Attorney for the District of Vermont stated that a Vermont resident has been indicted by a Burlington grand jury for her role straw-purchasing a firearm. Marissa Byrd, age 29, of Burlington was arraigned today before United States Magistrate Judge Kevin J. Doyle on an indictment charging her with providing false information to a federally licensed firearm dealer while purchasing a firearm in March of 2021. At the conclusion of the arraignment today, Byrd was released on conditions of supervision pending further proceedings.
The indictment alleges that on March 20, 2021, Byrd falsely informed a firearms dealer, Parro’s Gun Shop in Waterbury, that she was purchasing a 9-millimeter firearm for herself when she was actually purchasing the firearm for another person. This kind of illegal firearm transaction is commonly known as a “straw purchase.” The firearm Byrd purchased in March 2021 was seized by law enforcement seventeen days later during a search of the home of Thomas Caves in Plattsburgh, New York. At the time of the search, Caves was on parole and being supervised by the State of New York for a 2020 felony burglary conviction in Connecticut. Caves is currently charged by a federal criminal complaint in the Northern District of New York for possessing the firearm after having been convicted of a crime punishable by imprisonment for more than one year.
The charge in the indictment brought against Byrd is an accusation only, and she is presumed innocent until and unless proven guilty in further proceedings. If convicted of the crime of making a false statement to a licensed dealer of firearms during the purchase of a firearm in violation of 18 U.S.C. § 922(a)(6), Byrd would face a maximum possible penalty of 10 years in prison and a fine of up to $250,000. The actual sentence, however, would be determined by the Court with guidance from the advisory Federal Sentencing Guidelines.
Acting United States Attorney Jonathan A. Ophardt commended the coordinated investigatory efforts of Homeland Security Investigations in both the District of Vermont and the Northern District of New York and the Plattsburgh Police Department.
This case is being 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. More information about the program can be found at https://www.justice.gov/psn.
The United States is represented in this matter by Assistant U.S. Attorney Matthew J. Lasher. Marissa Byrd is represented by David Kirby, Esq.
Vancouver, Washington area man sentenced to 20 years in prison for online sexual exploitation of teensRead the Press Release
Tacoma – A Ridgefield, Washington, man was sentenced today in U.S. District Court in Tacoma to 20 years in prison and lifetime supervised release, for multiple federal felonies for his scheme to entice and pressure young teens into sending him sexually explicit photos and videos, announced Acting U.S. Attorney Tessa M. Gorman. Joshua Henry Punt, 39, pleaded guilty in April 2021, to using the messaging apps ‘Kik’ and ‘Snapchat’ to connect with teens while posing as a teenager. Punt then enticed and pressured young teens to send him sexually explicit photos and videos. Victims have been identified across the U.S., including in New York, Arkansas, California, Texas, Nevada, Kentucky, Pennsylvania, and West Virginia.
At today’s sentencing hearing, U.S. District Judge Benjamin H. Settle said, “There are no words to express how serious this crime is. The weight of the damage will go on for scores of decades – rippling through lives….” To Punt, Judge Settle said, “You could see the pain in those girls, and you continued to do it – to eight precious, innocent young girls – you tortured them.”
“This predatory defendant infiltrated our homes, using electronic access and social media to deceive, pressure and sexually exploit young girls across the country,” said Acting U.S. Attorney Gorman. “We warn our children about the ‘dangerous stranger’ they might encounter on the street – we must be equally vigilant about the ones who are lurking online.”
According to records filed in the case, Punt presented himself in his social media accounts as an attractive teenager by using profile pictures of youthful YouTube personalities. After innocuous preliminary communications with his intended victims, Punt demanded sexually provocative and/or sexually explicit photos and videos. Unbeknownst to his victims, Punt recorded their videos and images on a second phone. So, for example, when a victim believed she was sending a “snap,” which would automatically delete or notify the sender if an attempt was made to copy it, Punt surreptitiously recorded the images and videos for future use. When victims inevitably became uncomfortable with his behavior and attempted to exit the “relationship,” Punt threatened to send the videos/images to members of their local communities–including schools, coaches, and others‑‑if they did not comply with his demands, which included production of additional sexually explicit videos and images. The victims range in age from 12 to 16 years of age.
At the sentencing hearing one mother said of her daughter, “She met a monster disguised as a boy, and her life will be changed forever…. She now knows what evil looks like.”
“Collaborative law enforcement work ensures child predators will not be allowed to weaponize online communication tools to fulfill their perverse desires,” said Special Agent in Charge Robert Hammer, who oversees HSI operations in the Pacific Northwest. “As HSI seeks to protect communities from child exploitation crimes, parents and their children should be especially cautious with who they are interacting with online.”
“Mr. Punt is a prime example of what is referred to as a ‘Sextortionist,’” said Special Agent in Charge Donald Voiret, FBI Seattle. “While he will be serving time in a federal penitentiary for his actions, I would encourage parents everywhere to engage with their children about the risks of online predators.”
Punt was arrested on May 21, 2019. He was originally charged in Clark County Superior Court. He was charged federally on November 7, 2019.
In a separate investigation, the FBI identified Punt as the administrator of a child pornography distribution group on Kik. As an administrator, Punt actively patrolled the group – demanding that new members share content and banning those that failed to share child pornography. An FBI online covert employee followed links posted by Punt leading to a cache of child pornography.
On April 27, 2021, Punt pleaded guilty to production of child pornography, enticement of a minor, distribution of child pornography, and advertisement of child pornography. Punt will be required to register as a sex offender following prison.
The case was investigated by the Vancouver Police Department’s Digital Evidence Cybercrime Unit, in conjunction with Homeland Security Investigations. The FBI investigated Punt’s activity administering a site for the trading of images of child abuse and molestation. Law enforcement agencies in other jurisdictions also assisted this investigation.
Assistant U.S. Attorneys Angelica Williams and Cecelia Gregson prosecuted 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 United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Utica Man Arrested on Child Pornography ChargesRead the Press Release
SYRACUSE, NEW YORK – John Seiselmyer, age 49, of Utica, New York, was arrested today and charged with possessing child pornography. The announcement was made by Acting United States Attorney Antoinette T. Bacon, Janeen DiGuiseppi, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI), and New York State Police (NYSP) Superintendent Kevin P. Bruen.
According to the criminal complaint, Seiselmyer possessed videos of child pornography on his home computer. Seiselmyer is a registered sex offender who was convicted in 2007 of Criminal Sexual Act in the First Degree with a victim who was less than 11 years old. The charge in the complaint is merely an accusation. The defendant is presumed innocent unless and until proven guilty.
The charge against Seiselmyer carries a mandatory minimum sentence of 10 years and a maximum of 20 years in prison, a post-release term of supervision of between 5 years and life, and a fine of up to $250,000. 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.
Seiselmyer made his initial appearance today before United States Magistrate Judge Therese Wiley Dancks and was detained pending further proceedings.
This case is being investigated by the FBI Syracuse Mid-State Child Exploitation Task Force, comprised of FBI Special Agents and Investigators of the New York State Police, Bureau of Criminal Investigation (BCI), with assistance from the Utica Police Department. The case is being prosecuted by Assistant U.S. Attorney Geoffrey J. L. Brown as a part of Project Safe Childhood.
Launched in May 2006 by the Department of Justice, Project Safe Childhood is led by United States Attorney’s offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS). Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit https://www.justice.gov/psc.
United States Citizen Pleads Guilty to Conspiring to Assist North Korea in Evading SanctionsRead the Press Release
Audrey Strauss, the United States Attorney for the Southern District of New York, announced today that VIRGIL GRIFFITH, a U.S. citizen, pled guilty to conspiring to violate the International Emergency Economic Powers Act (“IEEPA”) by providing services to the Democratic People’s Republic of Korea (“DPRK” or “North Korea”) including technical advice on using cryptocurrency and blockchain technology to evade sanctions. GRIFFITH pled guilty today before U.S. District Judge P. Kevin Castel.
U.S. Attorney Audrey Strauss stated: “As he admitted in court today, Virgil Griffith agreed to help one of our nation’s most dangerous foreign adversaries, North Korea. Griffith worked with others to provide cryptocurrency services to North Korea and assist North Korea in evading sanctions, and traveled to North Korea to do so. In the process, Griffith jeopardized the national security of the United States by undermining the sanctions that both Congress and the President have enacted to place maximum pressure on the threat posed by North Korea’s treacherous regime.”
According to the Indictment and other documents in the public record, as well as statements made in public court proceedings:
Pursuant to the IEEPA and Executive Order 13466, United States Persons are prohibited from exporting any goods, services, or technology to the DPRK without a license from the Department of the Treasury, Office of Foreign Assets Control (“OFAC”).
GRIFFITH, a cryptocurrency expert, began formulating plans as early as 2018 to provide services to individuals in the DPRK by developing and funding cryptocurrency infrastructure there, including to mine cryptocurrency. GRIFFITH knew that the DPRK could use these services to evade and avoid U.S. sanctions, and to fund its nuclear weapons program and other illicit activities.
In April 2019, GRIFFITH traveled to the DPRK to attend and present at the “Pyongyang Blockchain and Cryptocurrency Conference” (the “DPRK Cryptocurrency Conference”). Despite the fact that the U.S. Department of State had denied GRIFFITH permission to travel to the DPRK, GRIFFITH delivered presentations at the DPRK Cryptocurrency Conference, tailored to the DPRK audience, knowing that doing so violated sanctions against the DPRK.
At the DPRK Cryptocurrency Conference, GRIFFITH and his co-conspirators provided instruction on how the DPRK could use blockchain and cryptocurrency technology to launder money and evade sanctions. GRIFFITH’s presentations at the DPRK Cryptocurrency Conference had been approved by DPRK officials and focused on, among other things, how blockchain technology such as “smart contracts” could be used to benefit the DPRK, including in nuclear weapons negotiations with the United States. GRIFFITH and his co-conspirators also answered specific questions about blockchain and cryptocurrency technologies for the DPRK audience, including individuals whom GRIFFITH understood worked for the North Korean government.
After the DPRK Cryptocurrency Conference, GRIFFITH pursued plans to facilitate the exchange of cryptocurrency between the DPRK and South Korea, despite knowing that assisting with such an exchange would violate sanctions against the DPRK. GRIFFITH also attempted to recruit other U.S. citizens to travel to North Korea and provide similar services to DPRK persons, and attempted to broker introductions for the DPRK to other cryptocurrency and blockchain service providers. At no time did GRIFFITH obtain permission from OFAC to provide goods, services, or technology to the DPRK.
* * *
VIRGIL GRIFFITH, 38, a resident of Singapore and citizen of the United States, pled guilty to one count of conspiring to violate IEEPA, which carries a maximum term of 20 years in prison. GRIFFITH is scheduled to be sentenced by Judge Castel on January 18, 2022, at 11:00 a.m.
The maximum potential sentence is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant would be determined by the judge.
Ms. Strauss praised the outstanding investigative work of the Federal Bureau of Investigation and its New York Field Office, Counterintelligence Division, and thanked the U.S. Department of State’s Diplomatic Security Service, the Department of Justice’s National Security Division, Counterintelligence and Export Control Section, the Department of Justice’s Office of International Affairs, and the Singapore Police Force for their assistance.
The case is being handled by the Office’s Terrorism and International Narcotics Unit. Assistant U.S. Attorneys Kimberly Ravener and Kyle A. Wirshba are in charge of the case, with assistance from Deputy Chief Elizabeth Cannon and Trial Attorney Matthew J. McKenzie of the Counterintelligence and Export Control Section.
United States Announces Settlement of Civil Action Addressing Clean Air Act Violations at New York City Public SchoolsRead the Press Release
The United States filed suit today under the Clean Air Act (CAA) against the City of New York and the New York City Department of Education (NYCDOE) and lodged a proposed consent judgment to address the defendants’ longstanding failure to properly monitor and control harmful emissions from NYCDOE oil-fired boilers in New York City public schools.
Many of NYCDOE’s boilers are located in disadvantaged communities whose residents are exposed to disproportionately high pollution levels that result in adverse health and environmental impacts. The consent judgment, agreed upon by the parties and also filed today with the court, requires NYCDOE to: (1) conduct regular tune-ups to monitor and repair its boilers as required by the CAA to control excess emissions; (2) reduce its boiler emissions by transitioning seven of its largest oil-fired boilers to cleaner, natural gas boilers by 2023, at an approximate cost of $50 million; and (3) pay a civil penalty of $1 million to the United States.
The complaint and consent judgment were filed in the U.S. District Court for the Eastern District of New York, in Brooklyn, New York. Following a 30-day public comment period, the United States will review all comments and, if appropriate, ask the court to enter the consent judgment.
“Students and teachers should not have to be concerned that the air they are breathing at school is harmful to their health,” said Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division. “This settlement will benefit New York’s schools and the communities they serve, who already suffer an unjust burden from polluted air.”
“The United States brought this action to protect our children, teachers, staff, and communities from exposure to high levels of hazardous air particles and particulate matter emitted by oil-fired boilers at NYCDOE schools, many of which are located in areas of the city that are already burdened by disproportionate levels of air pollution,” said Acting U.S. Attorney Jacquelyn M. Kasulis for the Eastern District of New York. “This settlement demonstrates that this office and its Environmental Justice Team are committed to addressing environmental justice concerns and reducing dangerous emissions and hazardous air pollutants in disadvantaged communities.”
“Thousands of New York City residents will be breathing cleaner air as a result of this case, many of whom live in communities overburdened by dangerous air pollution and other environmental challenges,” said Acting Regional Administrator Walter Mugdan of the Environmental Protection Agency (EPA). “This case demonstrates EPA’s commitment to advancing environmental justice and working with our partners, like the Justice Department, to ensure compliance with critical federal laws that protect public health and clean air. Children’s health is an EPA priority because children are often more vulnerable than adults to the risks of pollutants and environmental hazards.”
The CAA was passed by Congress in 1970, and amended in 1990, to protect public health and the environment through the regulation of air emissions from both stationary and mobile sources. The 1990 amendments to the law required the EPA to establish standards for air toxics, also known as hazardous air pollutants (HAPs). These standards impose limitations on HAP emissions from a variety of sources. In order to reduce these emissions from oil-fired boilers located at institutional sources including schools, the EPA promulgated national operation and maintenance standards for such boilers in 2011. These standards are commonly referred to as the Area Source Boiler Rule.
NYCDOE, the nation’s largest public-school system, operates oil-fired boilers at hundreds of public schools throughout the city. When these boilers are properly maintained, they play an important role in keeping the schools warm and do not emit excess pollution. When these boilers are not properly maintained, they can emit excess HAPs, along with other regulated pollutants such as particulate matter, nitrogen oxides, sulfur oxides, carbon monoxide and greenhouse gases. Regular tune-ups, which include monitoring of emissions, can increase a boiler’s combustion efficiency, lowering its actual emissions rate.
Over 1,300 of NYCDOE’s oil-fired boilers, at approximately 566 school facilities, became subject to the Area Source Boiler Rule in 2014. These regulations require boiler operators to conduct regular tune-ups and submit reports to the EPA about the status of all boilers subject to the rule. The rule also required NYCDOE to conduct one-time energy assessments for certain large oil-fired boilers. However, as set forth in the United States’ complaint, NYCDOE failed to comply with these requirements for several years after they took effect. As a result of the EPA’s and Department of Justice’s enforcement efforts, NYCDOE has now brought its boilers into compliance with the CAA.
The NYCDOE’s failure to properly perform tune-ups resulted in excess emissions that will be reduced under the consent judgment. Notably, many of NYCDOE’s boilers are located in communities identified by the EPA as posing environmental justice concerns, due to the large number of minority or low-income residents who are disproportionately exposed to air pollution and its harmful effects. Particulate matter and HAP emissions are linked to a range of health problems and cause environmental harm. The mitigation projects described below are targeted to provide environmental benefits in these communities.
The settlement requires the NYCDOE to regularly and properly conduct periodic tune-ups at regulated boilers. These tune-ups will proceed according to a checklist which ensures that the proper procedures and quality assurance measures are followed, and that all necessary maintenance or repairs are identified and addressed. To mitigate past emissions, NYCDOE has also agreed that prior to March 2023 it will convert to natural gas or replace seven large oil-fired boilers that burn more polluting number 4 oil – including one of the largest boilers in the school system, located at K430 (Brooklyn Tech High School). The other schools at which boilers will be replaced or converted are: Q053 (M.S. 53 Brian Piccolo), X029 (P.S./M.S. 029 Melrose School), K068 (I.S. 068 Isaac Bildersee); K306 (P.S. 306 Ethan Allen), M013 and M117 (each containing various co-located schools). These new or converted boilers will emit far less HAPs when running on natural gas, a cleaner-burning fuel. This effort is projected to reduce NYCDOE’s oil consumption and combustion by over three million gallons by November 2027, thereby mitigating excess emissions caused by NYCDOE’s earlier failure to follow the Area Source Boiler Rule. The mitigation projects effectively advance NYCDOE’s compliance with New York City’s PlaNYC, under which the city plans to phase out number 4 oil from all boilers by 2030.
In June, Acting U.S. Attorney Kasulis announced the creation of an Environmental Justice Team within the Office’s Civil Division comprised of seven Assistant U.S. Attorneys and led by Assistant U.S. Attorney Matthew Silverman, the Chief of Environmental Litigation. The Environmental Justice Team’s focus is the protection of the rights of residents of the Eastern District of New York who are disproportionately burdened by environmental and health hazards.
The civil negotiations and settlement were handled by Assistant U.S. Attorney Matthew Silverman, working with Liliana Villatora and Erick Ihlenburg of the EPA Region 2 Office of Regional Counsel, Chief Robert Buettner of the EPA Region 2 Air Compliance Branch, Chief Gaetano LaVigna of the Stationary Source Compliance Section of Air Compliance Branch and Ray Slizys and Harish Patel, also with the Air Compliance Branch.
United States Announces Settlement of Civil Action Addressing Clean Air Act Violations at New York City Public SchoolsRead the Press Release
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, Todd Kim, Assistant Attorney General of the Justice Department’s Environment and Natural Resources Division, and Walter Mugdan, Acting Regional Administrator of the United States Environmental Protection Agency, Region 2 (EPA), announced today that the United States filed suit under the Clean Air Act (CAA) against the City of New York and the New York City Department of Education (NYCDOE) to address their longstanding failure to properly monitor and control harmful emissions from NYCDOE oil-fired boilers in New York City public schools. Many of NYCDOE’s boilers are located in disadvantaged communities whose residents are exposed to disproportionately high pollution levels that result in adverse health and environmental impacts. The parties agreed to enter into a Consent Judgment, also filed today with the court, that requires NYCDOE to: (1) conduct regular tune-ups to monitor and repair its boilers as required by the CAA to control excess emissions; (2) reduce its boiler emissions by transitioning seven of its largest oil-fired boilers to cleaner, natural gas boilers by 2023 at an approximate cost of $50 million; and (3) pay a civil penalty of $1 million to the United States.
The Complaint and Consent Judgment were filed in the United States District Court for the Eastern District of New York, in Brooklyn, New York. Following a 30-day public comment period, the United States will review all comments and, if appropriate, ask the court to enter the Consent Judgment.
“The United States brought this action to protect our children, teachers, staff, and communities from exposure to high levels of hazardous air particles and particulate matter emitted by oil-fired boilers at NYCDOE schools, many of which are located in areas of the city that are already burdened by disproportionate levels of air pollution,” stated Acting United States Attorney Kasulis. “This settlement demonstrates that this Office and its Environmental Justice Team are committed to addressing environmental justice concerns and reducing dangerous emissions and hazardous air pollutants in disadvantaged communities.”
"Students and teachers should not have to be concerned that the air they are breathing at school is harmful to their health,” stated Assistant Attorney General Kim. “This settlement will benefit New York’s schools and the communities they serve, who already suffer an unjust burden from polluted air.”
“Thousands of New York City residents will be breathing cleaner air as a result of this case, many of whom live in communities overburdened by dangerous air pollution and other environmental challenges,” stated EPA Acting Regional Administrator Mugdan. “This case demonstrates EPA’s commitment to advancing environmental justice and working with our partners like the Justice Department to ensure compliance with critical federal laws that protect public health and clean air. Children’s health is an EPA priority because they are often more vulnerable than adults to the risks of pollutants and environmental hazards.”
The CAA was passed by Congress in 1970, and amended in 1990, to protect public health and the environment through the regulation of air emissions from both stationary and mobile sources. The 1990 amendments to the law required the EPA to establish standards for air toxics, also known as hazardous air pollutants (HAPs). These standards impose limitations on HAP emissions from a variety of sources. In order to reduce these emissions from oil-fired boilers located at institutional sources including schools, the EPA promulgated national operation and maintenance standards for such boilers in 2011. These standards are commonly referred to as the Area Source Boiler Rule.
NYCDOE, the nation’s largest public school system, operates oil-fired boilers at hundreds of public schools throughout the city. When these boilers are properly maintained, they play an important role in keeping the schools warm. When these boilers are not properly maintained, they can emit excess HAPs, along with other regulated pollutants such as particulate matter, nitrogen oxides, sulfur oxides, carbon monoxide, and greenhouse gases. Regular tune-ups, which include monitoring of emissions, can increase a boiler’s combustion efficiency, lowering its actual emissions rate.
Over 1,300 of NYCDOE’s oil-fired boilers, at approximately 566 school facilities, became subject to the Area Source Boiler Rule in 2014. These regulations require boiler operators to conduct regular tune-ups and submit reports to the EPA about the status of all boilers subject to the rule. The rule also required NYCDOE to conduct one-time energy assessments for certain large oil-fired boilers. However, as set forth in the United States’ complaint, NYCDOE failed to comply with these requirements for several years after they took effect. As a result of the EPA’s enforcement efforts, NYCDOE has now brought its boilers into compliance with the CAA.
The NYCDOE’s failure to properly perform tune-ups resulted in excess emissions that will be mitigated under the Consent Judgment. Notably, many of NYCDOE’s boilers are located in communities identified by the EPA as posing Environmental Justice concerns, due to the large number of minority or low-income residents who are disproportionately exposed to air pollution and its harmful effects. Particulate matter and HAP emissions are linked to a range of health problems and also cause environmental harm. The mitigation projects described below are targeted to provide environmental benefits in these communities.
The settlement requires the NYCDOE to regularly and properly conduct periodic tune-ups of regulated boilers. These tune-ups will proceed according to a checklist which ensures that the proper procedures and quality assurance measures are followed, and that all necessary maintenance or repairs are identified and addressed. To mitigate past emissions, NYCDOE has also agreed to convert or replace seven large oil-fired boilers that burn more polluting number 4 oil to natural gas prior to March 2023 – including one of the largest boilers in the school system, located at K430 (Brooklyn Tech High School). The other schools at which boilers will be replaced or converted are: Q053 (M.S. 53 Brian Piccolo), X029 (P.S./M.S. 029 Melrose School), K068 (I.S. 068 Isaac Bildersee); K306 (P.S. 306 Ethan Allen), M013 and M117 (each containing various co-located schools). These new or converted boilers will emit far less HAPs when running on natural gas, a cleaner-burning fuel. This effort is projected to reduce NYCDOE’s oil consumption and combustion by over 3 million gallons by November 2027, thereby mitigating excess emissions caused by NYCDOE’s earlier failure to follow the Area Source Boiler Rule. The mitigation projects effectively advance NYCDOE’s compliance with New York City’s PlaNYC, under which the city plans to phase out number 4 oil from all boilers by 2030.
The civil negotiations and settlement were handled by Assistant U.S. Attorney Matthew Silverman of the U.S. Attorney’s Office for the Eastern District of New York, working with Liliana Villatora and Erick Ihlenburg, Office of Regional Counsel, U.S. EPA Region 2, Robert Buettner, Chief, Air Compliance Branch, U.S. EPA Region 2, Gaetano LaVigna, Chief, Stationary Source Compliance Section, Air Compliance Branch, and Ray Slizys and Harish Patel, also with the EPA Region 2 Air Compliance Branch, Greg Fried, Chief, Stationary Source Enforcement Branch, Air Enforcement Division, EPA Office of Enforcement and Compliance Assurance (OECA) and Robert Klepp, also with OECA.
In June of this year, Acting U.S. Attorney Kasulis announced the creation of an Environmental Justice Team within the Office’s Civil Division comprised of seven Assistant U.S. Attorneys and led by Assistant U.S. Attorney Silverman, the Chief of Environmental Litigation. The Environmental Justice Team’s focus is the protection of the rights of residents of the Eastern District of New York who are disproportionately burdened by environmental and health hazards.
E.D.N.Y. Docket No.: 21-CV-5338 (PKC)
Troy Felon Charged with Unlawful Possession of a FirearmRead the Press Release
ALBANY, NEW YORK – Justin Smith, age 21, of Troy, New York, was ordered detained on Friday pending trial on a charge that he unlawfully possessed a firearm as a felon.
The announcement was made by Acting United States Attorney Antoinette T. Bacon and Janeen DiGuiseppi, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI).
The complaint alleges that Smith, a felon, possessed a handgun in Troy on or about March 5, 2021. The charge in the complaint is merely an accusation. The defendant is presumed innocent unless and until proven guilty.
The charge carries a maximum sentence of 10 years in prison, a fine of up to $250,000, and a term of post-imprisonment supervised release of up to 3 years. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines and other factors.
This case is being investigated by the FBI and the Troy Police Department, and is being prosecuted by Assistant U.S. Attorney Dustin Segovia.
Three New York Men Sentenced to Prison for Elaborate Scheme to Sell Illegally Imported DrugsRead the Press Release
PITTSBURGH, PA - Three New York state residents were sentenced in federal court on Friday to terms of imprisonment on their convictions for participating in a complex Bank and Wire Fraud conspiracy, Acting United States Attorney Stephen R. Kaufman announced today.
United States District Judge David Stewart Cercone imposed the following sentences on the following individuals: • 38-month term of imprisonment followed by three years of supervised release on Devan Abrams, age 40, of West 37th Street, New York, New York; • 38-month term of imprisonment followed by three years of supervised release on Azad Khizgilov, age 47, of Dahlgren Place, Brooklyn, New York; and
• 28-month term of imprisonment followed by two years of supervised release on Roman Shaulov, age 54, of Shore Parkway, Brooklyn, New York.According to information presented to the court, including in a public filing, for years these defendants enriched themselves by leading a massive and sophisticated fraud scheme that facilitated the black-market importation and sale of tens of millions of dollars of dangerous and addictive prescription medications and controlled substances. In summary, they established and ran a business that, through a series of misrepresentations, misled various credit card companies into processing credit card transactions for purchases of drugs that were illegal to be sold in the United States. These drugs were often imported from Russia, China, India, and other countries. The complex scheme involved front companies, fake websites, and a tangled web of bank accounts.
“Committing fraud was the full-time job of these defendants,” said Acting U.S. Attorney Kaufman. “They manipulated friends and even family members to serve as owners of front companies, they had a cadre of employees whom they supervised and trained to commit fraud, and they created and executed a complex scheme that allowed them, for years, to deceive sophisticated financial institutions. Now they have been held accountable for their criminal actions.”
“When prescription drugs from outside FDA’s secure supply chain enter the U.S. marketplace, patients are put at risk. The risk is even greater when the criminals disguise the purchase of these unlawful drugs to avoid detection,” said Special Agent in Charge Mark S. McCormack, FDA Office of Criminal Investigations Metro Washington Field Office. “We will continue to pursue and bring to justice those who engage in illegal conduct that undermines the safety of the US drug supply.”
Assistant United States Attorney Brendan T. Conway prosecuted this case on behalf of the government.
Acting United States Attorney Kaufman commended the Food and Drug Administration Office of Criminal Investigations, Homeland Security Investigations, Pennsylvania State Police and United States Postal Inspection Service for the investigation leading to the successful prosecution of these defendants.
Three Alleged Drug Traffickers Arrested, Charged in PampaRead the Press Release
Three alleged drug traffickers in Pampa, Texas – including the alleged local president of the Bandidos motorcycle gang – have been charged with gun and drug crimes, announced Acting U.S. Attorney Prerak Shah.
Tracey Dylan Cain, 31, Jason Mulenax, 43, and Erik Gutierrez, 23, were charged via criminal complaint with possession with intent to distribute controlled substances and possession of firearms in furtherance of drug trafficking crimes. All three defendants made their initial appearances before U.S. Magistrate Judge Lee Ann Reno in Amarillo Monday afternoon. The federal government has moved to detain them based upon dangerousness and risk of flight.
According to court documents, the men were arrested Friday during searches of their respective residences.
Inside Mr. Cain’s home, law enforcement recovered large amounts of cocaine, methamphetamine, LSD, ecstasy, and marijuana, large amounts of U.S. currency, and numerous firearms, including a gold-plated .50 caliber pistol with a handmade suppressor. Prior to the search, Mr. Cain barricaded himself inside his home and refused to cooperate with officers.
Inside Mr. Gutierrez’s home, law enforcement recovered a powdery substance believed to be cocaine, a 10mm Glock pistol, and approximately $6,000 in cash. Inside Mr. Mulenax’s home, they recovered a green leafy substance believed to be marijuana, seven firearms, drug paraphernalia, and approximately $1,098 in cash.
During interviews, both Mr. Gutierrez and Mr. Mulenax admitted to selling drugs and named their supplier as Mr. Cain.
Law enforcement previously identified Mr. Mulenax as the alleged local president of the Bandidos, one of the nation’s most dangerous organized motorcycle gangs. The organization’s former national president, Jeffrey Fay Pike, was convicted of drug trafficking, racketeering, and other violent crimes in federal court in San Antonio in 2018 and later sentenced to life plus ten years in federal prison.
A criminal complaint is merely an allegation of criminal conduct, not evidence. All defendants are presumed innocent until proven guilty in a court of law.
If convicted, these men face up to life in federal prison.
The Federal Bureau of Investigation’s Dallas Field Office and the Texas Department of Public Safety conducted the investigation with help from the Drug Enforcement Administration, the Pampa Police Department, and the Gray County Sheriff’s Office. Assistant U.S. Attorney Anna Marie Bell is prosecuting the case.
Sureños Gang Member Sentenced to 120 Months in Federal Prison for Brandishing a Firearm While Committing a Carjacking and Illegal Possession of a FirearmRead the Press Release
Spokane – Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that Orlando Raul Rodriguez, a/k/a “Toon,” age 31, of Yakima, Washington, was sentenced today after having pleaded guilty on June 22, 2021, of brandishing a firearm while committing a crime of violence and for illegal possession of a firearm. United States District Judge Salvador Mendoza, Jr. sentenced Rodriguez to a 120-month term of imprisonment, to be followed by a 3-year term of court supervision after he is released from federal prison.
According to information disclosed during court proceedings, Rodriguez, a known member of the Sureños street gang, and three others lured the victim to a parking lot in downtown Yakima at approximately 9 a.m. on July 5, 2020. Rodriguez pointed a .22 caliber rifle at the victim and ordered the victim and his passenger out of the vehicle. Once the victim was out of the vehicle, one of Rodriguez’s accomplices drove the vehicle away with Rodriguez in the passenger seat. The victim and his passenger walked to a nearby business and called police. Officers from Yakima Police Department responded quickly and where able to locate and apprehend Rodriguez and his accomplices within an hour of the carjacking being reported.
Acting United States Attorney Harrington said, “The lengthy sentence reflects our commitment to prosecute those who seek to commit violent crimes against members of our community. The United States Attorney’s Office for the Eastern District of Washington commends the law enforcement officers with the Yakima Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives who investigated this case. Violent crime in our communities will not be tolerated.”
Yakima Police Department Chief Matt Murry said, “The partnership we share with federal law enforcement and this U.S. Attorney’s Office is invaluable. This case and others like it that are working through the system are examples of the commitment to use every tool available to hold those who commit violence accountable. Make no mistake about it, if you choose to engage in violence we WILL investigate and prosecute you.”
This case was investigated by the Yakima Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. This case was prosecuted by Richard Burson and Todd Swenson, Assistant United States Attorneys for the Eastern District of Washington.
Six members of the Nine Trey Gangster Bloods gang plead guilty to RICO conspiracyRead the Press Release
ATLANTA – In a series of pleas, six members of the Nine Trey Gangsters (NTG) national criminal organization pleaded guilty to Racketeer Influenced and Corruption Organization (RICO) conspiracy charges.
“Members of the Nine Trey Gangsters showed a shocking indifference to human life, both in carrying out planned acts of violence, and in distributing drugs, including methamphetamine, throughout Georgia,” said Acting U.S. Attorney Kurt Erskine. “While the gang offered members a sense of belonging and the opportunity to make money through illicit drug sales, it was those same members who were most often the targets of violence from the gang based solely on the whims of the gang’s leaders.”
“The Department will continue to bring to justice the leaders and most violent members of dangerous criminal enterprises like the Nine Trey Gangsters,” said Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division. “Removing those most responsible for the violence and drug dealing perpetrated by members and associates of violent street gangs like the Nine Trey Gangsters makes our neighborhoods and communities safer.”
“Members of Nine Trey Gangsters have plagued our streets with violence and drug trafficking for far too long,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “These pleas are an example of our commitment to dismantle organized, violent criminal enterprises. The community can rest assured these defendants won’t be on our streets for a very long time, thanks to the efforts of the FBI led Safe Streets Gang Task Force and its state and local partners.”
“As part of our commitment of ridding our facilities of criminal activity, we maintain a robust plan for identifying and managing those participating in gang activity from behind prison walls,” said Georgia Department of Corrections Commissioner Timothy C. Ward. “We appreciate the support and assistance of our law enforcement partners on every level, in our efforts to see that justice is being served on those who pose a threat to the safety of the public and the safe operations of our facilities.”
According to Acting U.S. Attorney Erskine, the charges and other information presented in court: The Nine Trey Gangsters are a national gang that started in the prisons of New York as a subset of the United Bloods Nation and has since spread throughout the East Coast and Southeast. The NTG are a criminal organization whose members and associates engage in acts of violence, including murder, assaults, robbery, firearms possession, witness tampering, obstruction of justice, drug trafficking, extortion, and other criminal activities, which took place in the Northern District of Georgia and elsewhere.
The Nine Trey Gangsters have a hierarchical structure their members throughout the country are subdivided into separate groups or “lines.” Each NTG member has a specific rank within the gang or a specific line, and this rank comes with specific duties and responsibilities. Each of the six defendants who pleaded guilty were part of the gang’s “Fire” line.
The following NTG gang members have pleaded guilty to count one of the second superseding indictment charging them and four others with RICO conspiracy:
Tyrone Clark, a/k/a “Tight Eye,” Joseph Riley, a/k/a “Joe Blow,” Gary Sartor a/k/a “G-Stacks,” and Patrick Caple a/k/a “Zoe,” all held the rank of “Fifth Floor” in the gang’s hierarchy, one of the highest ranks an individual can hold within a line of the gang. In those roles they were responsible for overseeing all of the members below them and reporting up to the gang’s national leadership.
- Tyrone Clark, a/k/a “Tight Eye,” Joseph Riley, a/k/a “Joe Blow,” Gary Sartor a/k/a “G-Stacks,” and Patrick Caple a/k/a “Zoe,” all held the rank of “Fifth Floor” in the gang’s hierarchy, one of the highest ranks an individual can hold within a line of the gang. In those roles they were responsible for overseeing all of the members below them and reporting up to the gang’s national leadership.
- Brandon Asberry a/k/a “B5,” held the rank of “Second Floor” in the gang’s hierarchy. In the role of Second Floor, Asberry was responsible for collecting dues form the gang’s members and overseeing the gang’s meetings or “nines.”
- Michael Jackson a/k/a “MJ,” held the rank of “Third Floor” in the gang’s hierarchy, where he was responsible for planning “wars” or conflicts with rival gangs and providing weapons to other NTG members.
Gary Sartor, Patrick Caple, and Michael Jackson were in Georgia Department of Corrections custody when they participated in the conspiracy.
Tyrone Clark, 40, of Marietta, Georgia, Joseph Riley, 37, of Atlanta, Georgia, Gary Sartor, 37, of Atlanta, Georgia, Patrick Caple, 56, of Glennville, Georgia, Michael Jackson, 27, of Chester, Georgia, and Brandon Asberry, 32, of Atlanta, Georgia have pleaded guilty to Count 1 of the Second Superseding Indictment, charging them and four others with RICO Conspiracy, in violation of 18 U.S.C. § 1962(d) for their involvement in planning, facilitating, and executing multiple acts of violence and participation in the gang’s drug trafficking activities, including the distribution of methamphetamine, marijuana and Xanax. Each defendant will be sentenced in the coming months by U.S. District Court Judge Amy Totenberg.
This case is being investigated by the Federal Bureau of Investigation as part of their FBI Safe Streets Task Force with assistance from the Georgia Department of Corrections.
This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.