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Friday 30 July 2021
Iranian National Charged with Illegally Exporting Laboratory Equipment from the United States to IranRead the Press Release
WASHINGTON – A federal grand jury in the District of Columbia returned an indictment today charging a Canadian national with the unlawful export of laboratory equipment from the United States to Iran, through Canada and the United Arab Emirates (UAE).
According to court documents, Reza Sarhangpour Kafrani, aka Reza Sarhang, 46, an Iranian national residing in Montreal, was indicted by a grand jury in the U.S. District Court for the District of Columbia on one count of conspiracy, two counts of violations of the International Emergency Economic Powers Act (IEEPA), one count of causing a failure to submit export information and six counts of money laundering. The indictment also includes a forfeiture allegation seeking all proceeds of the alleged crimes. Kafrani will be arraigned on the charges on a date to be determined by the court.
According to the indictment, Kafrani and a co-conspirator co-owned Prolife Global, Ltd., which was based in Canada, but conducted business in the United States and elsewhere. In November 2015, Kafrani began negotiating with a U.S. company to purchase mass spectrometry equipment for import to Canada. During those negotiations, Kafrani initially inquired about costs to ship and install the equipment in Montreal, Canada. Later, however, Kafrani asked a representative of the company if the installation costs were the same for the Middle East, and the representative of the company e-mailed Kafrani, saying, “You know there are sanctions in place for Iran.” Kafrani was unable to purchase the equipment from this company.
As alleged in the indictment, he then began negotiations with a second U.S. company for the purchase of similar mass spectrometry equipment in March 2016. Ultimately, he and a co-conspirator were able to purchase three mass spectrometers and an autosampler, used to automatically load samples into the mass spectrometer, for a total of approximately $110,739.
Chromatography and spectrometry analytical instruments, such as some of the laboratory equipment purchased by Kafrani, are controlled for nuclear nonproliferation reasons and therefore require a license to be exported from the United States to either Iran or the UAE. Specifically, a license is required from the Department of Commerce’s Bureau of Industry and Security (BIS) to export such items to the UAE while a license is required from the Department of the Treasury, Office of Foreign Assets Control (OFAC) to export to Iran. The remaining laboratory equipment purchased by Kafrani may not be exported to Iran without a license from OFAC. Kafrani and his co-conspirator applied for an export license from OFAC on Nov. 16, 2015, and again April 23, 2016, but OFAC declined to grant either application. Kafrani’s co-conspirator applied for a license from BIS on March 28, 2016, but that application was returned without action by BIS because OFAC is responsible for administering the U.S. sanctions against Iran.
On Aug. 24, 2016, Kafrani and his co-conspirator directed the second U.S. company to ship one mass spectrometer to Canada, and then coordinated with a Canadian shipping company to reexport it to the UAE on Sept. 7, 2016. From there, they arranged for a UAE based shipping company to reexport the item to Iran on Sept. 25, 2016.
In September 2016, Kafrani and his co-conspirator arranged for a Canada-based shipping company to pick up two more mass spectrometers and an autosampler directly from the second U.S. company, transport the items to Canada, and then reexport them to the UAE Kafrani then hired a UAE-based transport company to reexport the items to Iran on Oct. 11, 2016.
Kafrani never told the second U.S. company that the items were ultimately destined for Iran, causing the firm to fail to file the legally required electronic export information. Kafrani also made, or caused to be made, six separate money transfers from bank accounts in Canada and elsewhere to bank accounts in the United States with the intent to promote the unlawful exports to Iran described above.
Charges of conspiracy and failing to submit export information carry a statutory maximum of five years in prison. Violations of the IEEPA and money laundering charges carry a statutory maximum of 20 years in prison. The charges also carry potential financial penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting Assistant Attorney General Mark J. Lesko of the Justice Department’s National Security Division (NSD); Acting U.S. Attorney Channing D. Phillips for the District of Columbia; Special Agent in Charge Kevin M. Kelly of the Department of Homeland Security’s Homeland Security Investigations (HSI) Buffalo Field Office; Special Agent in Charge Jonathan Carson of Department of Commerce’s New York Field Office, Office of Export Enforcement; Acting Special Agent in Charge Thomas Fattorusso of the IRS Criminal Investigation (IRS-CI) New York Field Office and Special Agent in Charge Stephen Belongia of the FBI’s Buffalo Field Office made the announcement.
This case is being investigated by the Buffalo Field Office of the U.S. Department of Homeland Security’s Homeland Security Investigations (HSI), the New York Field Office of the Department of Commerce’s Office of Export Enforcement, the New York Field Office of IRS Criminal Investigation (IRS-CI) and the Buffalo Field Office of the FBI.
Assistant U.S. Attorney Christopher Tortorice for the U.S. Attorney’s Office in the District of Columbia and Trial Attorney Beau Barnes of the National Security Division’s Counterintelligence and Export Control Section are prosecuting the case, with substantial assistance provided by former Assistant U.S. Attorney Jessica Brooks and former Trial Attorney Heather Alpino.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Inmate Sentenced for Possessing Weapon at FCI BeckleyRead the Press Release
BLUEFIELD, W.Va. - An inmate at the Federal Correctional Institution (FCI) at Beckley was sentenced today for possessing a weapon at the correctional facility. Elijio Perez, 30, of Texas, was sentenced to 12 months in prison to run consecutively to the sentence he currently is serving.
According to court documents, Perez possessed a handcrafted weapon on March 31, 2020 while he was an inmate at the FCI Beckley. A staff member found the weapon after Perez had placed it on the floor between a desk and a wall in an office at the prison. The weapon was a piece of metal about 9 ½ inches long and sharpened to a point on one end. Perez admitted that the shank was designed and intended to be used as a weapon.
Acting United States Attorney Lisa G. Johnston made the announcement and commended the investigative work of the Federal Bureau of Prisons. Assistant United States Attorney Timothy D. Boggess handled the prosecution.
United States District Judge Frank W. Volk imposed the sentence.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 5:21-cr-00001.
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Huron Man Charged with Possession of a Firearm by a Prohibited PersonRead the Press Release
Acting United States Attorney Dennis R. Holmes announced that a Huron, South Dakota, man has been indicted by a federal grand jury for Possession of a Firearm by a Prohibited Person.
Yeh Thwin, age 23, was indicted on April 6, 2021. He appeared before U.S. Magistrate Judge Veronica L. Duffy on July 28, 2021, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in federal prison and/or a $250,000 fine, three years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on or about November 12, 2020, Thwin, having previously been convicted of a crime punishable by imprisonment for a term exceeding one year, knowingly possessed a Glock GmbH, Model 22C Gen 3, .40 Smith and Wesson caliber, semi-automatic pistol. That pistol had been shipped and transported in interstate and foreign commerce.
The charge is merely an accusation and Thwin is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Bureau of Alcohol, Tobacco, Firearms, and Explosives. Assistant U.S. Attorney Jeffrey C. Clapper is prosecuting the case.
Thwin was released on bond pending trial which has been set for October 5, 2021.
Haines City Man Convicted of Drug TraffickingRead the Press Release
GAINESVILLE, FLORIDA – Jose Roberto Garcia Arroyo, 45, of Haines City, Florida, has been sentenced to serve more than eleven years in federal prison for conspiracy to distribute more than 5 kilograms of cocaine and possession with intent to distribute more than 5 kilograms of cocaine. The sentence was announced by Jason R. Coody, Acting United States Attorney for the Northern District of Florida.
In May 2020, agents from the Federal Bureau of Investigation (FBI) received information that Garcia Arroyo, the maintenance supervisor at two local apartment complexes in Gainesville, was receiving shipments of cocaine from Puerto Rico through the United States Postal Service. FBI agents teamed up with agents from the United States Postal Inspection Service (USPIS) Office and the United States Postal Service Office of Inspector General. After researching parcel history associated with the two complexes, agents were able to determine that between August 2019 and June 2020, 110 parcels had been shipped from Puerto Rico, most weighing approximately 6 pounds. One of these historical parcels was interdicted by USPIS at a postal facility and found to contain 2 kilograms of cocaine. Agents were also able to determine that a shipment of parcels was in transit to the apartment complexes.
“This investigation demonstrates the effectiveness and collaborative efforts of our local and federal law enforcement partners, to identify and intercept shipments of illegal substances via the United States Mail,” said Acting U.S. Attorney Coody. “The sentence imposed should serve as a significant deterrent to those who would use the United States Postal Service to conduct illegal activities.”
A joint surveillance operation was conducted in Gainesville on June 11, 2020. During this operation, agents learned that Garcia Arroyo obtained 6 parcels from the postal carrier which had been shipped from Puerto Rico to addresses within the apartment complexes. Shortly thereafter, an Alachua County Sheriff’s Office (ACSO) deputy conducted a traffic stop on Garcia Arroyo’s vehicle and a subsequent search of the truck revealed 6 priority mail parcels in the truck’s bed. These parcels were each found to contain 2 kilograms of cocaine. A search warrant was executed at Garcia Arroyo’s maintenance office and priority mailboxes and a drug ledger were located and seized. On June 12, 2020, USPIS interdicted another priority mail parcel that had been shipped from Puerto Rico to the apartment complexes in Gainesville. This parcel was also found to contain 2 kilograms of cocaine.
“We appreciate and applaud the outstanding work by the investigative and legal teams,” said Special Agent in Charge Scott Pierce, U.S. Postal Service Office of Inspector General, Southern Area Field office. “As this sentence clearly shows, any individual or organization who chooses to use the U.S. Mail to further illicit narcotics trafficking activity will be aggressively investigated and held accountable for their illegal conduct.”
As a result of the combined investigative efforts of these law enforcement agencies, Garcia Arroyo was held accountable at sentencing for trafficking 234 kilograms of cocaine. Authorities were able to seize 16 kilograms of cocaine over the course of the investigation.
This sentencing resulted from the collaborative efforts of the Federal Bureau of Investigation, United States Postal Inspection Service Office, the United States Postal Service Office of Inspector General and the Alachua County Sheriff’s Office. Assistant United States Attorney Christopher Elsey prosecuted the case.
The United States Attorney's Office for the Northern District of Florida is one of 94 offices that serve as the nation’s principal litigators under the direction of the Attorney General. To access public court documents online, please visit the U.S. District Court for the Northern District of Florida website. For more information about the United States Attorney’s Office, Northern District of Florida, visit http://www.justice.gov/usao/fln/index.html.
Government Intervenes in False Claims Act Lawsuits Against Kaiser Permanente Affiliates for Submitting Inaccurate Diagnosis Codes to the Medicare Advantage ProgramRead the Press Release
The United States has intervened in six complaints alleging that members of the Kaiser Permanente consortium violated the False Claims Act by submitting inaccurate diagnosis codes for its Medicare Advantage Plan enrollees in order to receive higher reimbursements.
The Kaiser Permanente consortium members (collectively Kaiser) are Kaiser Foundation Health Plan Inc., Kaiser Foundation Health Plan of Colorado, The Permanente Medical Group Inc., Southern California Permanente Medical Group Inc. and Colorado Permanente Medical Group P.C. Kaiser is headquartered in Oakland, California.
“Medicare’s managed care program relies on the accuracy of information submitted by health care providers and plans to ensure that patients receive the appropriate level of care, and that plans receive the appropriate compensation,” said Deputy Assistant Attorney General Sarah E. Harrington of the Justice Department’s Civil Division. “Today’s action sends a clear message that we will hold health care providers and plans accountable if they seek to game the system by submitting false information.”
“The integrity of government health care programs must be protected,” said Acting U.S. Attorney Stephanie Hinds for the Northern District of California. “The Medicare Advantage Program maintains the health of millions, and wrongful acts that defraud the program cannot continue and will be pursued.”
“The federal government pays hundreds of billions of dollars every year to Medicare Advantage Plans,” said Acting U.S. Attorney Matt Kirsch for the District of Colorado. “The District of Colorado will vigorously pursue investigations with our partners to make sure that money supports necessary health care, not fraud.”
Under Medicare Advantage, also known as the Medicare Part C program, Medicare beneficiaries have the option of enrolling in managed care insurance plans called Medicare Advantage Plans (MA Plans). MA Plans are paid a per-person amount to provide Medicare-covered benefits to beneficiaries who enroll in one of their plans. The Centers for Medicare and Medicaid Services (CMS), which oversees the Medicare program, adjusts the payments to MA Plans based on demographic information and the diagnoses of each plan beneficiary. The adjustments are commonly referred to as “risk scores.” In general, a beneficiary with more severe diagnoses will have a higher risk score, and CMS will make a larger risk-adjusted payment to the MA Plan for that beneficiary.
Medicare requires that, for outpatient medical encounters, MA Plans submit diagnoses to CMS only for conditions that required or affected patient care, treatment or management during an in-person encounter in the service year. In order to increase its Medicare reimbursements, Kaiser allegedly pressured its physicians to create addenda to medical records after the patient encounter, often months or over a year later, to add risk-adjusting diagnoses that patients did not actually have and/or were not actually considered or addressed during the encounter, in violation of Medicare requirements.
The lawsuits were filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government for false claims and to receive a share of any recovery. The False Claims Act also permits the government to intervene in such lawsuits, as it has done, in part, in these cases. The cases are consolidated in the Northern District of California and captioned United States ex rel. Osinek v. Kaiser Permanente, 3:13-cv-03891 (N.D. Cal.); United States ex rel. Taylor v. Kaiser Permanente, et al., 3:21-cv-03894 (N.D. Cal.); United States ex rel. Arefi, et al. v. Kaiser Foundation Health Plan, Inc., et al., 3:16-cv-01558 (N.D. Cal.); United States ex rel. Stein, et al. v. Kaiser Foundation Health Plan, Inc., et al., 3:16-cv-05337 (N.D. Cal.); United States ex rel. Bryant v. Kaiser Permanente, et al., 3:18-cv-01347 (N.D. Cal.); and United States ex rel. Bicocca v. Permanente Med. Group, Inc., et al., No. 3:21-cv-03124 (N.D. Cal.).
This matter was investigated by the Civil Division’s Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Offices for the Northern District of California and the District of Colorado, with assistance from HHS-OIG.
The claims in which the United States has intervened are allegations only, and there has been no determination of liability.
Government Intervenes in False Claims Act Lawsuits Against Kaiser Permanente Affiliates for Submitting Inaccurate Diagnosis Codes to the Medicare Advantage ProgramRead the Press Release
SAN FRANCISCO – The United States has intervened in six complaints alleging that members of the Kaiser Permanente consortium violated the False Claims Act by submitting inaccurate diagnosis codes for its Medicare Advantage Plan enrollees in order to receive higher reimbursements.
The Kaiser Permanente consortium members (collectively Kaiser) are Kaiser Foundation Health Plan Inc., Kaiser Foundation Health Plan of Colorado, The Permanente Medical Group Inc., Southern California Permanente Medical Group Inc. and Colorado Permanente Medical Group P.C. Kaiser is headquartered in Oakland, California.
“The integrity of government health care programs must be protected,” said Acting U.S. Attorney Stephanie Hinds for the Northern District of California. “The Medicare Advantage Program maintains the health of millions, and wrongful acts that defraud the program cannot continue and will be pursued.”
“Medicare’s managed care program relies on the accuracy of information submitted by health care providers and plans to ensure that patients receive the appropriate level of care, and that plans receive the appropriate compensation,” said Deputy Assistant Attorney General Sarah E. Harrington of the Justice Department’s Civil Division. “Today’s action sends a clear message that we will hold health care providers and plans accountable if they seek to game the system by submitting false information.”
“The federal government pays hundreds of billions of dollars every year to Medicare Advantage Plans,” said Acting U.S. Attorney Matt Kirsch for the District of Colorado. “The District of Colorado will vigorously pursue investigations with our partners to make sure that money supports necessary health care, not fraud.”
Under Medicare Advantage, also known as the Medicare Part C program, Medicare beneficiaries have the option of enrolling in managed care insurance plans called Medicare Advantage Plans (MA Plans). MA Plans are paid a per-person amount to provide Medicare-covered benefits to beneficiaries who enroll in one of their plans. The Centers for Medicare and Medicaid Services (CMS), which oversees the Medicare program, adjusts the payments to MA Plans based on demographic information and the diagnoses of each plan beneficiary. The adjustments are commonly referred to as “risk scores.” In general, a beneficiary with more severe diagnoses will have a higher risk score, and CMS will make a larger risk-adjusted payment to the MA Plan for that beneficiary.
Medicare requires that, for outpatient medical encounters, MA Plans submit diagnoses to CMS only for conditions that required or affected patient care, treatment or management during an in-person encounter in the service year. In order to increase its Medicare reimbursements, Kaiser allegedly pressured its physicians to create addenda to medical records after the patient encounter, often months or over a year later, to add risk-adjusting diagnoses that patients did not actually have and/or were not actually considered or addressed during the encounter, in violation of Medicare requirements.
The lawsuits were filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government for false claims and to receive a share of any recovery. The False Claims Act also permits the government to intervene in such lawsuits, as it has done, in part, in these cases. The cases are consolidated in the Northern District of California and captioned United States ex rel. Osinek v. Kaiser Permanente, 3:13-cv-03891 (N.D. Cal.); United States ex rel. Taylor v. Kaiser Permanente, et al., 3:21-cv-03894 (N.D. Cal.); United States ex rel. Arefi, et al. v. Kaiser Foundation Health Plan, Inc., et al., 3:16-cv-01558 (N.D. Cal.); United States ex rel. Stein, et al. v. Kaiser Foundation Health Plan, Inc., et al., 3:16-cv-05337 (N.D. Cal.); United States ex rel. Bryant v. Kaiser Permanente, et al., 3:18-cv-01347 (N.D. Cal.); and United States ex rel. Bicocca v. Permanente Med. Group, Inc., et al., No. 3:21-cv-03124 (N.D. Cal.).
This matter was investigated by the Civil Division’s Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Offices for the Northern District of California and the District of Colorado, with assistance from HHS-OIG.
The claims in which the United States has intervened are allegations only, and there has been no determination of liability.
Georgia Man Sentenced to More Than 5 Years in Federal Prison for Role in Trafficking Meth in South CarolinaRead the Press Release
Columbia, South Carolina --- Acting United States Attorney M. Rhett DeHart announced today that Rondedrick Robinson, 26, of Decatur, Georgia, was sentenced to more than five years in federal prison, after pleading guilty to possessing with intent to distribute methamphetamine.
Evidence presented to the Court showed that, on February 25, 2020, officers from the Aiken County Sheriff’s Office made a traffic stop on a vehicle driven by Robinson. In a subsequent search of the vehicle, law enforcement located nearly 10 kilograms of methamphetamine. Further investigation revealed Robinson had been paid to deliver the narcotics from the Atlanta area to South Carolina.
Senior United States District Judge Joseph F. Anderson, Jr. sentenced Robinson to 70 months in federal prison, to be followed by a three-year term of court-ordered supervision. There is no parole in the federal system.
The case was investigated by the Aiken County Sheriff’s Office and the Drug Enforcement Administration (DEA).
Assistant United States Attorney Katherine Flynn prosecuted the case.
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Four Syracuse Men Charged with Fentanyl Trafficking ConspiracyRead the Press Release
SYRACUSE, NEW YORK – Four Syracuse men were indicted yesterday and charged with conspiracy to distribute fentanyl, and possessing controlled substances with the intent to distribute. The announcement was made by Acting U.S. Attorney Antoinette T. Bacon; Ray Donovan, Special Agent in Charge of the U.S. Drug Enforcement Administration (DEA), New York Field Division; and Chief Kenton Buckner, City of Syracuse Police Department.
- Raphael Frias, age 28, was charged with conspiring to distribute and possess with intent to distribute fentanyl, and possessing fentanyl with the intent to distribute. If convicted, Frias faces between 5 and 40 years in prison, a fine of up to $5 million, and a term of supervised release of at least 4 years and up to life.
- Carlos Esteras, age 40, was charged with conspiring to distribute and possess with intent to distribute fentanyl, and possessing fentanyl with the intent to distribute. If convicted, Esteras faces between 5 and 40 years in prison, a fine of up to $5 million, and a term of supervised release of at least 4 years and up to life.
- Adrian Esteras, age 37, was charged with conspiring to distribute and possess with intent to distribute fentanyl, and possessing cocaine with the intent to distribute. If convicted, Esteras faces up to 20 years in prison, a fine of up to $1 million, and a term of supervised release of at least 3 years and up to life.
- Shane Williams, age 30, was charged with conspiring to distribute and possess with intent to distribute fentanyl, and possessing a firearm and ammunition after being convicted of a felony. If convicted, Williams faces up to 20 years in prison, a fine of up to $1 million, and a term of supervised release of at least 3 years and up to life.
The charges in the indictment are merely accusations, and all defendants are presumed innocent unless and until proven guilty. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines, and other factors.
The defendants were arrested on July 6, 2021, and are detained pending trial. At the time of the defendants’ arrests, law enforcement seized over 1,500 envelopes containing suspected fentanyl, a quantity of cocaine, and a loaded Smith & Wesson 9mm handgun.
This case is being investigated by the DEA, the Syracuse Police Department, the Onondaga County Sheriff’s Office, the Onondaga County District Attorney’s Office, the New York State Police, the New York State Division of Parole, the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), and U.S. Immigration and Customs Enforcement, Enforcement and Removal Operations, and is being prosecuted by Assistant U.S. Attorney Thomas Sutcliffe.
- Raphael Frias, age 28, was charged with conspiring to distribute and possess with intent to distribute fentanyl, and possessing fentanyl with the intent to distribute. If convicted, Frias faces between 5 and 40 years in prison, a fine of up to $5 million, and a term of supervised release of at least 4 years and up to life.
Former President and CEO of now bankrupt precious metals firm convicted of mail and wire fraud for Ponzi-type schemeRead the Press Release
Seattle – The former President & CEO of Northwest Territorial Mint, a now-bankrupt company dealing in precious metals, was convicted today in U.S. District Court in Seattle of 14 federal felonies resulting from a Ponzi-like scheme that defrauded customers of millions of dollars, announced Acting U.S. Attorney Tessa M. Gorman. After more than three weeks of testimony and evidence, the jury deliberated about two days before convicting Bernard Ross Hansen, 60, aka Ross B. Hansen of multiple counts of wire and mail fraud. The jury also convicted Vault Manager Diane Renee Erdmann, 48, of 13 counts of wire fraud and mail fraud following the trial. Sentencing for both Mr. Hansen and Ms. Erdmann is scheduled for October 29, 2021.
Northwest Territorial Mint (NWTM) operated both a custom business that involved the manufacturing of medallions and other awards, and a bullion business that involved the selling, buying, exchanging, storing, and leasing of gold, silver, and other precious metals. The company had offices in Federal Way and Auburn, Washington, but declared bankruptcy on April 1, 2016.
According to records in the case and testimony at trial, Hansen and Erdmann defrauded NWTM customers in a variety of ways. The evidence at trial showed that Hansen and Erdmann lied about shipping times for bullion, used customer money to expand the business to other states, and used customer money to pay their own personal expenses. In this way the company lacked enough assets to fulfill customer orders and used new customer money to pay off older customers in a Ponzi-like scheme. In total, over 2500 customers paid for orders, or made bullion sales or exchanges, that were either never fulfilled or never refunded. The total loss to these customers was more than $25,000,000.
In closing arguments, Assistant United States Attorney Benjamin Diggs told the jury “They tried to make this company look solid – like the metals they sold – but in fact it was a house of cards.”
In addition to the bullion customer fraud, the evidence at trial demonstrated that Hansen and Erdmann defrauded customers who paid NWTM to safely and securely store bullion in the NWTM vaults. Evidence and testimony at trial showed that Hansen and Erdmann used this bullion that was supposed to be in secure storage to fulfill other orders. In April 2016, the NWTM vaults were inventoried and all or part of the stored bullion for more than 50 customers was missing. The missing bullion was worth more than $4.9 million.
Each of the counts of conviction are punishable by up to 20 years in prison. U.S. District Judge Richard A. Jones will determine the appropriate sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The case was investigated by the FBI. The case was prosecuted by Assistant United States Attorneys Brian Werner and Benjamin Diggs.
Former Member of New Bedford Latin Kings Chapter Pleads Guilty to Racketeering ConspiracyRead the Press Release
BOSTON – A former member of the New Bedford Chapter of the Massachusetts Almighty Latin King and Queen Nation (Latin Kings) pleaded guilty yesterday to racketeering charges.
Jose Vasquez, a/k/a “King Fearless,” 28, pleaded guilty to conspiracy to conduct enterprise affairs through a pattern of racketeering activity, more commonly referred to as RICO conspiracy. U.S. Senior District Court Judge Rya W. Zobel scheduled sentencing for Nov. 3, 2021.
As stated during the plea hearing, Vasquez served as the Enforcer for the New Bedford Latin Kings Chapter. In his role as Enforcer, Vasquez admitted to approving a “mission” or shooting of a victim that took place in June 2019. This victim was targeted for obtaining and selling drugs from a source that was not sanctioned by the Latin Kings. Vasquez also admitted to his participation in a shooting of two victims in May 2018. During that incident, multiple Latin Kings members chased the two victims to a vehicle, surrounded the vehicle, and slashed their tires. Another Latin Kings member then fired gunshots at the two victims striking them. Both victims fled in the vehicle and survived. Vasquez admitted that these victims were targeted due to one of the victims having previously objected to Latin Kings members conducting drug transactions in the victim’s driveway.
The Latin Kings are a violent criminal enterprise comprised of thousands of members across the United States. The Latin Kings adhere to a national manifesto, employ an internal judiciary and use a sophisticated system of communication to maintain the hierarchy of the organization. As alleged in court documents, the gang uses drug distribution to generate revenue, and engages in violence against witnesses and rival gangs to further its influence and to protect its turf.
In December 2019, a federal grand jury returned an indictment alleging racketeering conspiracy, drug conspiracy and firearms charges against 62 leaders, members and associates of the Latin Kings. Vasquez is the 47th defendant to plead guilty in the case.
The RICO conspiracy charge provides for a sentence of up to 20 years in prison, three years of supervised release and a fine of $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney Nathaniel R. Mendell; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division; Commissioner Carol Mici of the Massachusetts Department of Correction; and New Bedford Police Chief Joseph C. Cordeiro made the announcement today. Valuable assistance was also provided by the FBI North Shore Gang Task Force and the Bristol County and Suffolk County District Attorney’s Offices. Assistant U.S. Attorneys Philip A. Mallard and Lauren A. Graber of Mendell’s Criminal Division are prosecuting the case.
This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
The details contained in the charging documents are allegations. The remaining defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Former Boston Police Auto Repair Technician Agrees to Plead Guilty to Wire Fraud ChargesRead the Press Release
BOSTON – A former auto repair technician with the Boston Police Department’s (BPD) Fleet Management Division has been charged and has agreed to plead guilty in connection with a scheme to embezzle hundreds of thousands of dollars from the BPD.
Bahram Gharony, 36, of Boston, has agreed to plead guilty to two counts of wire fraud. A plea hearing has not yet been scheduled by the court.
According to the charging document, Gharony is alleged to have engaged in a scheme to defraud BPD’s Fleet Management Division of over $260,000 in automotive parts, tools and supplies between June 2017 and September 2020. It is alleged that Gharony used his position to order parts and supplies that he purported were for BPD, but were actually converted and sold to others by Gharony. In an effort to conceal the scheme, Gharony allegedly submitted fraudulent and altered invoices to BPD for the parts, tools and supplies he falsely claimed were ordered for the fleet. Additionally, Gharony purported that he had lawfully purchased the items through a discount available to BPD when selling the items to others.
The charges of wire fraud each provide for a sentence of up to 20 years in prison, three years of supervised release and fine of $250,000, or twice the gross gain or loss, whichever is greater. 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; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division; and Boston Police Acting Commissioner Gregory Long made the announcement. Assistant U.S. Attorney Neil J. Gallagher Jr. of Mendell’s Public Corruption & Special Prosecutions Unit is prosecuting the case.
The details contained in the charging document are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Former Bank Branch Manager Sentenced for Fraud SchemesRead the Press Release
INDIANAPOLIS – An Avon woman was sentenced to 3 years in prison for bank and mail fraud. She will also serve 2 years of supervised release and was ordered to pay over $315,000 in restitution.
According to court documents, Susan Fruits, 46, devised two separate fraud schemes. Fruits’ s bank fraud scheme targeted customers of the Brownsburg, Indiana bank where she served as branch manager. Fruits admitted in court that between 2017 and 2020, she perpetrated a scheme to withdraw money from customers’ Certificate of Deposit (CD) accounts without their knowledge. She digitally signed for the customers without their authorization, effectively forging their signatures, and then approved the withdrawals using her position as branch manager. In total, she stole more than $180,000 from the bank’s customers using this scheme.
Fruits mail fraud scheme targeted three children for whom she served as guardian and trustee of their inheritance. Fruits admitted that in mid-2015, one of Fruits’ s close friends died, leaving trust accounts for the friend’s three children. Fruits was named the trustee for the accounts, each of which had more than $50,000 in them. Over the course of eight months, Fruits spent all the money in the children’s accounts on unauthorized purchases.
To conceal her thefts, she created and mailed false bank statements purporting to show that the children’s accounts still had thousands of dollars in them. The three trust accounts had zero dollars left because Fruits had spent all the money.
Between the two schemes, Fruits admitted to stealing more than $315,000.
“Ms. Fruits’ actions were full of greed and selfishness,” said Acting U.S. Attorney John E. Childress. "It is sad to see someone abuse a position of trust for self-enrichment, especially at the cost of children who have already lost so much. Fruits has been brought to justice and the victims will receive what is due to them.”
"This sentencing sends a clear message that targeting not only those you serve, but innocent children, comes with a price,” said FBI Indianapolis Acting Special Agent in Charge Robert Middleton. “The FBI will continue to work with the United States Attorney's Office to ensure those who choose to put personal greed ahead of the law are identified and brought to justice.”
This case was investigated by the Federal Bureau of Investigation
Assistant U.S. Attorney Adam Eakman prosecuted the case.
Final Member of A Halifax County Multi-Kilogram Heroin Trafficking Organization SentencedRead the Press Release
NEW BERN, N.C. – A Princeville man was sentenced this week to 57 months in prison for conspiracy to distribute and possession with intent to distribute 1 kilogram or more of heroin and a quantity of marijuana.
According to court documents, Mario Marelle Scott, 44, was named in a Third Superseding Indictment filed on October 11, 2018. On November 13, 2019, Scott entered a plea of guilty.
In March 2016, members of the Tar River Regional Drug Task Force (TRRDTF), led by the Nash County Sheriff’s Office, learned that a drug trafficking organization was bringing large amounts of heroin from New Jersey to Nash, Edgecombe, and Halifax Counties. The organization would then sell the heroin in those counties.
On March 13, 2017, agents conducted a traffic stop of Herbert Lamont Cherry and Tony Ray Reams as they returned from Paterson, New Jersey. A search of the vehicle resulted in the seizure of 470 grams of heroin, which were packaged in 34,722 “bindles” or dosage units.
On August 16, 2017, agents conducted a traffic stop of Tara Finis Simmons and Charles Lee Wright as they returned from Paterson, New Jersey. The vehicle was searched and found to contain 110 grams of heroin and 13 grams of marijuana.
Agents then interviewed a series of witnesses, who indicated that the drug trafficking organization was led by Terrence Cornelius Clyburn, a/k/a “Tee.” Clyburn would arrange for the transportation of large amounts of heroin to North Carolina via couriers. Those couriers included Tony Reams, Herbert Cherry, Tara Simmons, and Charles Wright.
Other members of the organization would distribute the drugs in North Carolina, including Patrick Holiday, Tyshawn Reams, and Mario Scott.
From 2015 to 2017, Mario Scott and Patrick Holiday distributed approximately 100 grams of heroin each month in North Carolina for the organization. In total, Mario Scott was responsible for trafficking almost 10 kilograms of heroin.
Below are the results of the other cases in this investigation:
- Terrence Clyburn, Case No. 4:17-CR-0046-3: 147 months’ imprisonment.
- Patrick Direece Holiday, Case No. 4:17-CR-0046-5: 96 months’ imprisonment.
- Tyshawn Rayvon Reams, Case No. 4:17-CR-0046-4: 88 months’ imprisonment.
- Charles Lee Wright, Case No. 4:17-CR-0046-1: 60 months’ imprisonment.
- Tara Finis Simmons, Case No. 4:17-CR-0046-2: 28 months’ imprisonment
- Herbert Lamont Cherry, Case No. 4:17-CR-0025-FL-1: 47 months’ imprisonment.
- Tony Ray Reams, Case No. 4:17-CR-0025-FL-2: 71 months’ imprisonment.
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 Nash County Sheriff’s Office, Edgecombe County Sheriff’s Office, Halifax County Sheriff’s Office, Wake County Sheriff’s Office, Bladen County Sheriff’s Office, Spring Hope Police Department and the Tarboro Police Department investigated the case and Assistant U.S. Attorney Scott A. Lemmon prosecuted the case.
This case is part of the United States Attorney’s Office’s 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. For additional information about this initiative, click here https://www.justice.gov/usao-ednc/tbnc.
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. 4:17-cr-00046-FL-6.
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Federal Jury Convicts Final Member of Drug Trafficking Organization Supplying Heroin to McAlester AreaRead the Press Release
MUSKOGEE, OKLAHOMA - The United States Attorney’s Office for the Eastern District of Oklahoma, announced today that Michael Moses George, age 41, of Oklahoma City, Oklahoma was found guilty by a federal jury of Drug Conspiracy, in violation of Title 21, United States Code, Section 846. The jury trial began with testimony on Monday, July 26, 2021 and concluded on Wednesday, July 28, 2021 with the guilty verdict. Based on the jury’s verdict, the defendant is facing a term of imprisonment of not less than 10 years nor more than life.
During the trial, the United States presented evidence that beginning in July 2019, and continuing until December 2020, in the Eastern District of Oklahoma and elsewhere, George conspired with Dennis Dewayne Cantrell, Dennis Edward Cantrell, Randall Brent Cook, Jason Nathaniel Holland, Paul Casey Craig, Bree Angelica Osburn, Christina Michelle Ketchum, Stacie Renee Borrenkott, and Parker Bolin Mathiews to distribute more than a kilogram of heroin in the Eastern District of Oklahoma. Trial witnesses testified the defendant purchased heroin from co-conspirators and served as a major source of heroin for a co-conspirator in McAlester who sold to various persons in the McAlester area. DEA agents executed a search warrant of George’s Oklahoma City apartment at the time of his arrest. In the apartment they found nearly a pound of heroin, $20,000 in bundled cash, and four firearms. A search of the George’s cellphone revealed text messages demonstrating a history of selling heroin to people in the McAlester and Oklahoma City areas.
All of the other defendants originally indicted in the case have entered guilty pleas. The guilty verdict was the result of an investigation by the McAlester Police Department, the Oklahoma Bureau of Narcotics, District 18 Drug Taskforce, and the Drug Enforcement Administration.The Honorable John F. Heil, III, U.S. District Judge in the United States District Court for the Eastern District of Oklahoma in Muskogee, presided over the trial and ordered the completion of a presentence report. Sentencing will be scheduled following completion of the report. George was remanded to the custody of the United States Marshal pending the imposition of sentencing.
Assistant United States Attorneys Ryan Conway and James Montoya represented the United States.
Federal Judge Closes Receivership in Petters Ponzi Scheme Case; More Than $722 Million Distributed to Victim InvestorsRead the Press Release
MINNEAPOLIS – United States District Judge Ann D. Montgomery has issued an order closing the receivership of Thomas J. Petters and discharging the Receiver in one of the nation’s largest and most complex Ponzi schemes. Through the efforts of the Receiver, the United States, and related bankruptcy trustees more than $722 million was distributed to victims and creditors.
In issuing the order, Judge Montgomery remarked that the receivership was “prompted by one of the largest and most complex Ponzi schemes in U.S. history.” Judge Montgomery went on to state that “the primary objective of the Receivership was to preserve assets for victims and creditors…After more than 120 public [court] hearings and nearly 3,300 [case] docket entries, the work of the Receiver has concluded.”
The United States commenced the receivership case in October of 2008 to enjoin the ongoing fraud by Petters and the other named defendants and to preserve all assets owned by the defendants for ultimate restitution and forfeiture in the criminal investigations of the defendants, which were pending at the time.
The United States immediately moved to freeze the assets of the named defendants, including all assets owned by Petters. On October 14, 2008, the Court issued the injunction against Petters and appointed Douglas A. Kelley as the Receiver of the assets of Petters and the other named defendants. At the time none of the defendants had yet been indicted.
The Receiver immediately began taking control of the assets and property owned by Petters and the other named defendants. Petters and the other defendants had created a vast web of more than 150 entities over the course of thirteen years – entities that were all propped up by fraud. Some of the entities, however, were legitimate businesses that employed innocent persons.
The Receiver placed several of the major entities into bankruptcy, including Sun Country Airlines and Polaroid Corporation, for the protection of innocent employees and creditors. Throughout the receivership, the Receiver also managed real estate, categorized assets, liquidated property, paid employees, commenced claw-back litigation, entered into settlement agreements, and worked in coordination with the bankruptcy and government forfeiture process to achieve an orderly disentanglement of the fraud.
“Following the criminal conviction of Tom Petters in 2009 for orchestrating a $1.9 billion Ponzi scheme, the work of recovering assets on behalf of victim investors and creditors had just begun,” said Acting U.S. Attorney W. Anders Folk. “Throughout this case the U.S. Attorney’s Office sought to remain transparent, thorough, and persistent in our pursuit of justice. I commend the work of the Receiver and all parties involved in recovering more than $722 million on behalf of victims.”
On December 1, 2008, Petters was indicted on multiple counts of mail fraud, wire fraud, money laundering, and conspiracy for orchestrating a $1.9 billion Ponzi scheme. On December 2, 2009, a federal jury found Petters guilty of all 20 counts against him, and he was later sentenced by U.S. District Judge Richard H. Kyle to 50 years in federal prison. Other defendants were convicted in related criminal proceedings. As part of their sentencing judgments, Petters and other defendants were ordered to forfeit assets obtained through their criminal activity, including real estate, bank, and investment accounts, vehicles, and other assets. Under federal law, the Department of Justice has the authority to distribute the proceeds of forfeited assets through the remission process to victim investors who lost money in connection with the scheme. The proceeds of all forfeited assets are being distributed to victim investors.
Fort Washakie Man Indicted for Abusive Sexual Contact with a MinorRead the Press Release
Acting United States Attorney Bob Murray announced today that ANNIN DAMIAN SOLDIERWOLF, 52, of Fort Washakie, Wyoming, was indicted by a federal grand jury on July 22, 2021, for Abusive Sexual Contact. The Indictment alleges that Soldierwolf knowingly engaged and attempted to engage in sexual contact with a minor.
Soldierwolf appeared on July 28, 2021 before United States Magistrate Judge Kelly Rankin and pleaded not guilty to the Indictment. A jury trial is set for September 20, 2021, in Casper before Chief United States District Court Judge Scott Skavdahl. The maximum penalty upon conviction is up to life in prison; five years to life of supervised release; up to a $5,000 special assessment fee pursuant to the Victims of Sex Trafficking Act of 2015; up to $250,000 fine and a $100 special assessment.
The investigation is being conducted by the Federal Bureau of Investigation and Assistant United States Attorney Kerry J. Jacobson is prosecuting the case.
The charges against Soldierwolf are merely accusations, and he is presumed innocent until proven guilty.
Ex-CEO of La Quinta Communications Services Company Sentenced to More Than 2 Years in Prison for Defrauding Lender to Tech IndustryRead the Press Release
RIVERSIDE, California – The former CEO of a La Quinta-based communication services company was sentenced today to 27 months in federal prison for fraudulently obtaining $5 million in bank loans by submitting sham financial documents that overstated his company’s net worth.
Richard Loren Lewis, 67, of La Quinta, was sentenced by United States District Judge John W. Holcomb, who also ordered him to pay $3,414,064 in restitution. Lewis pleaded guilty on May 7 to one count of bank fraud and one count of making a false statement to a financial institution.
From April 2013 to April 2016, Lewis, who was the CEO of Blue Wave Media Inc., schemed to defraud Silicon Valley Bank, a Santa Clara-based commercial bank that funds start-up technology companies.
Lewis submitted false financial documents to Silicon Valley Bank that misrepresented Blue Wave Media’s net worth, liquidity and revenue so the bank would lend millions of dollars to his company. The false financial statements claimed that Blue Wave Media had millions of dollars in cash deposits and millions of dollars more in revenue streams. In truth, Blue Wave Media had little to no cash on hand and little to no incoming revenue. Lewis’s misrepresentations caused the bank to approve four loans totaling $5 million.
Lewis executed the scheme by willfully causing a loan and security agreement to be signed with Silicon Valley Bank in April 2013 to secure a $500,000 loan. In January 2014, he submitted an amendment to the agreement to the bank to secure an additional $500,000 loan. In June 2014, Lewis willfully caused another amendment to the agreement to secure a $1 million loan, and, in April 2015, Lewis signed a third amendment to the agreement with the bank to secure a $3 million loan.
As a result of Lewis’s criminal activity, Silicon Valley Bank sustained actual losses of approximately $3,414,064.
The FBI investigated this matter.
Assistant United States Attorney Robert S. Trisotto of the Riverside Branch Office prosecuted this case.
District Man Sentenced to 33 Months in Prison for Accessing Child PornographyRead the Press Release
WASHINGTON – Brian Kampel, 44, of Washington, D.C., was sentenced today to 33 months in prison for accessing child pornography, announced Acting U.S. Attorney Channing D. Phillips, and Raymond Villanueva, Special Agent in Charge, Homeland Security Investigations (HSI), Washington, D.C.
Kampel pleaded guilty earlier this month in the U.S. District Court for the District of Columbia. He was sentenced by the Honorable Judge Dabney L. Friedrich. Following his prison term, he will be placed on supervised release for the rest of his life. In addition, he will be required to register as a sex offender for 15 years following his release from prison. Judge Friedrich also ordered Kampel to pay $39,000 in restitution to his victims.
According to the government’s evidence, Kampel was identified as part of a national investigation, conducted by the U.S. Department of Homeland Security Investigations (HSI), into a password-protected, fee-based website, that advertised child sexual abuse material.
After gaining access to the website, an individual could pay to purchase and download child pornography. This commercial website advertised that it offered users, like Kampel, 600,000 images and 400 hours of video. Kampel paid to purchase and download child pornography in August of 2017.
Following a search of Kampel’s residence, in September of 2019, law enforcement found a laptop computer with over 1,000 images depicting the sexual abuse of children as young as infants and toddlers. The forensic evidence in the case determined that Kampel had been accessing, downloading, and possessing child sexual abuse material for over eight years.
This case was brought as part of the Department of Justice's Project Safe Childhood initiative. Project Safe Childhood is a nationwide initiative designed to protect children from online exploitation and abuse. Led by the U.S. Attorney's Offices, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
In announcing the sentence, Acting U.S. Attorney Phillips and Special Agent in Charge Villanueva commended the work of those who investigated the case from the Department of Homeland Security, Homeland Security Investigations. They also commended the work of Assistant U.S. Attorney Amy E. Larson, who prosecuted the case.
Dark Web Narcotics Dealer “Fentmaster,” Responsible for Overdose Death, Sentenced to 15 Years in PrisonRead the Press Release
Audrey Strauss, the United States Attorney for the Southern District of New York, announced that CHUKWUEMEKA OKPARAEKE, a/k/a “Emeka,” was sentenced today to 180 months in prison for importing and trafficking fentanyl analogues and other synthetic opioids through the dark web. OKPARAEKE previously pled guilty to distributing U-47700, a controlled substance analogue of AH-7921; importing 100 grams and more of acryl fentanyl, a controlled substance analogue of fentanyl, from Hong Kong; and making false statements to the Government regarding the proceeds of his offenses. Through his guilty plea, OKPARAEKE admitted that in November 2016, he sold U-47700 to an 18-year-old individual (the “Victim”), who died from an overdose after using the drug. OKPARAEKE further admitted that his narcotics offenses involved over 9 kilograms of acryl fentanyl, nearly 6 kilograms of U-47700, over a kilogram of furanyl fentanyl, as well as 12 grams of 4-ANPP. OKPARAEKE was sentenced in White Plains federal court by U.S. District Judge Nelson S. Román, who previously accepted OKPARAEKE’s guilty plea.
U.S. Attorney Audrey Strauss said: “Chukwuemeka Okparaeke previously admitted that he peddled highly addictive opioids over the darknet, including to an 18-year-old who died from them. Okparaeke also lied to agents and prosecutors about the whereabouts of Bitcoins representing millions of dollars in poison-peddling proceeds. Now Okparaeke will forfeit those proceeds and go to prison for his crimes.”
According to the allegations in the Superseding Information, Complaint, other court filings, and statements made during public court proceedings:
From at least July 2016 through March 2017, OKPARAEKE imported kilogram quantities of fentanyl analogues, including acryl fentanyl and furanyl fentanyl, and other synthetic opioids, including U-47700, from Hong Kong and China into the United States. To transact with customers and coordinate his narcotics sales, OKPARAEKE used a darknet website known as AlphaBay Market (“AlphaBay”), accessible only through a special software program that allows users to mask their identities and anonymize their internet traffic. Under the AlphaBay vendor name “Fentmaster,” OKPARAEKE engaged in more than 7,000 sales of synthetic opioids, which he shipped to customers throughout the United States using the U.S. Postal Service. OKPARAEKE’s narcotics trafficking generated criminal proceeds of at least 680.60963624 Bitcoins, worth millions of dollars.
In November 2016, OKPARAEKE sold three grams of U-47700 to the Victim, an 18-year-old living in Vancouver, Washington, in an AlphaBay transaction. The Victim used the drugs purchased from OKPARAEKE and died in a U-47700 overdose on November 10, 2016.
OKPARAEKE – who attended medical school before he began selling synthetic opioids on AlphaBay – used extensive measures to conceal his identity, including software to encrypt his internet traffic and communications sent from his cellphone. Using alter egos, he boasted online about his exploits as a darknet drug trafficker, offered advice to other drug dealers, and published a short story describing his criminal activities and his strategies for evading law enforcement. In January 2017, Customs and Border Protection (“CBP”), in conjunction with Homeland Security Investigations (“HSI”) and United States Postal Inspection Service (“USPIS”), intercepted several packages containing kilogram quantities of fentanyl analogues that OKPARAEKE had imported from Hong Kong. Subsequently, in March 2017, law enforcement searched a drug premises OKPARAEKE maintained in Kearny, New Jersey. During the search, law enforcement seized more than 10 kilograms of U-47700, acryl fentanyl, and furanyl fentanyl, as well as a quantity of 4-ANPP and approximately 82 mailing envelopes containing smaller amounts of those substances that OKPARAEKE had packaged for distribution to his customers.
On September 15, 2020, OKPARAEKE met with representatives of the U.S. Attorney’s Office for the Southern District of New York. During that meeting, OKPARAEKE falsely represented that the approximately 680 Bitcoins – worth millions of dollars – generated by his narcotics sales on AlphaBay were no longer in his possession and control, and that a third party had stolen the Bitcoins from him through hacking and other unauthorized access to OKPARAEKE’s electronic accounts. OKPARAEKE subsequently surrendered the 680 Bitcoins to USPIS and agreed to forfeit those proceeds as part of his plea agreement.
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In addition to the prison term, OKPARAEKE, 32, of Middletown, New York, was sentenced to five years of supervised release and ordered to forfeit $105,177.30 in United States currency and 680.60963624 Bitcoins, presenting proceeds of his narcotics trafficking.
Ms. Strauss praised the outstanding efforts of the USPIS, HSI, CBP, the Federal Bureau of Investigation, the Fairfax County, Virginia, Police Department, the Virginia Office of the Attorney General, the Middletown Police Department, and the Vancouver, Washington, Police Department for their investigative work and ongoing support and assistance with the case.
The case is being prosecuted by the Office’s White Plains Division. Assistant United States Attorneys Gillian Grossman, Olga I. Zverovich, and Sagar Ravi are in charge of the prosecution.
Cleveland City Councilman Convicted of Federal Program Theft, Tax Violations, Witness Tampering and Falsifying RecordsRead the Press Release
Acting U.S. Attorney Bridget M. Brennan announced that a federal jury found Cleveland City Councilman Kenneth Johnson, 75, guilty of all 15-counts charged in an indictment related to two federal program theft schemes Johnson organized and executed while serving as Ward 4 Councilman in the City of Cleveland. Garnell Jamison, 62, was also convicted of 11-counts for his role and participation in one of the schemes.
Following a seven-day trial, Johnson was convicted of two counts of conspiracy to commit federal program theft; six counts of federal program theft; five counts of aiding and assisting in the preparation of false tax returns; one count of tampering with a witness and one count of falsification of records in a federal investigation.
Jamison was convicted of 11-counts, including federal program theft, aiding and assisting in the preparation of false tax returns, tampering with a witness and falsification of records in a federal investigation. Jamison worked for the City of Cleveland as Johnson’s Executive Assistant, a position he held for over 20 years.
Johnson and Jamison were indicted by a grand jury on February 18, 2021.
Evidence presented at trial established that from January of 2010 through October of 2018, Johnson and Jamison devised a scheme to induce the City of Cleveland to issue reimbursement checks to Johnson for Ward 4 services that were never actually performed. Court records established that during this time frame, the City issued $1,200 monthly expense reimbursement checks to Johnson totaling approximately $127,200. Each reimbursement check from the City was deposited into Johnson’s personal bank account.
Additionally, Johnson was convicted of personally benefiting from federal Community Development Funds distributed to the Buckeye Shaker Square Development Corporation (BSSDC) from the City of Cleveland. From in or around December 2013 to in or around March 2018, prosecutors proved that the BSSDC issued approximately $50,000 in checks distributed to third-parties, which were later deposited or transferred the funds into bank accounts held or controlled by Johnson. Federal regulations prohibited Johnson, or his family members, from personally benefiting from these funds.
Furthermore, prosecutors proved that for calendar years 2014, 2015, 2016, 2017, and 2018, Johnson and Jamison submitted false and fraudulent Individual Income Tax Returns to the Internal Revenue Service. Court evidence and testimony proved that Johnson and Jamison knew that the returns were false and fraudulent in that each return understated Johnson’s total income by failing to report additional income and by inflating the value of Johnson’s itemized deductions.
Lastly, Johnson and Jamison were convicted of attempting to persuade and influence the testimony of a grand jury witness by providing that person with false and fraudulent information and records purporting to document charitable donations made by Johnson. In addition, Johnson and Jamison falsified a donation receipt with the intent to impede, obstruct and influence an investigation.
Johnson and Jamison will be sentenced on October 8, 2021.
This case was investigated by the Cleveland Division of the FBI, Department of Housing and Urban Development Office of Inspector General and IRS-Criminal Investigation. This case is being prosecuted by Assistant United States Attorneys Justin Seabury Gould and Megan R. Miller.
Charlottesville Dermatologist Sentenced for Diverting Pain MedicationRead the Press Release
CHARLOTTESVILLE, Va., – A dermatologist formerly employed at a dermatological practice in the City of Charlottesville was sentenced last week to 12 months’ probation, including a period of home confinement and electronic monitoring, for using the Drug Enforcement Administration (DEA) registration number of her co-workers to obtain prescription opioid pain medication.
Dr. Amalie Shaffner Derdeyn, 48, of Charlottesville, pleaded guilty in March 2021 to three counts of using the DEA registration numbers of another person to obtain one or more controlled substances.
According to court documents, between July 2015 and November 2016, Derdeyn diverted large quantities of injectable meperidine, a Schedule II pain medication, known by the brand name Demerol. She did so by using her own DEA registration number, as well as the DEA registration numbers of other physicians in the practice, without their knowledge or consent, to obtain the drugs from local pharmacies. As part of her plea agreement with the United States, Derdeyn agreed to pay $33,000 in restitution to victims no later than the date of her sentencing hearing, and to pay all remaining restitution before her period of probation ends. According to government filings, the restitution owed to victims may be as much as $45,000.
Acting U.S. Attorney Daniel P. Bubar of the Western District of North Carolina; and Jared Forget, Special Agent in Charge of the DEA’s Washington Division made the announcement.
The Drug Enforcement Administration investigated the case, with assistance from the Virginia State Police. Assistant U.S. Attorneys Kari Munro and Michael Baudinet prosecuted the case for the United States.
Central New York Man Pleads Guilty to Theft of Government PropertyRead the Press Release
SYRACUSE, NEW YORK – Frederick L. Guth, Jr., age 66, of Brewerton, New York, pled guilty yesterday to theft of Social Security retirement benefits.
The announcement was made by Acting United States Attorney Antoinette T. Bacon and John F. Grasso, Special Agent in Charge of the Social Security Administration, Office of the Inspector General, New York Field Office.
As part of his guilty plea, Guth admitted that from November 2016 until July 2018, he erroneously received a total of $33,812.00 in Social Security retirement benefits issued under the social security number and name of another person, and that he spent the benefits despite knowing that the benefits were not his and that he was not entitled to them.
Sentencing is scheduled for November 30, 2021, before Senior United States District Judge Thomas J. McAvoy in Binghamton, New York. Guth faces up to 10 years in prison, up to 3 years of supervised release, and a fine of up to $250,000 as a result of his conviction. Additionally, Guth has agreed to pay restitution to the Social Security Administration. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines, and other factors.
This case was investigated by the SSA Office of the Inspector General and is being prosecuted by Special Assistant U.S. Attorney Adrian S. LaRochelle.
Canadian National Charged with Sexual Abuse of MinorsRead the Press Release
MINNEAPOLIS – A Canadian national has been indicted by a federal grand jury on charges related to the sexual abuse of minors occurring on the Bois Forte Indian Reservation, announced Acting U.S. Attorney W. Anders Folk.
According to court documents, on June 22, 2018, Brady John Hillis, 32, of Kenora, Ontario, knowingly engaged in sexual contact with two minor victims who were under 12 years of age.
Hillis is charged with two counts of abusive sexual contact with a child under 12 years of age and one count of aggravated sexual abuse of a child under 12 years of age. Hillis made his initial appearance today in U.S. District Court before Magistrate Judge David T. Schultz.
This case is the result of an investigation conducted by the FBI and the Bois Forte Police Department.
Assistant U.S. Attorney Deidre Y. Aanstad is prosecuting the case.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Cabarrus County Man Sentenced to Prison for Drug Trafficking and Firearm OffensesRead the Press Release
GREENSBORO, NC - Martin William Luther Hamilton, of Kannapolis, North Carolina, was sentenced today to 180 months in prison for distribution of fentanyl and possession of a firearm by a felon.
According to court documents, the Kannapolis Police Department received information from a confidential source that Hamilton was storing narcotics and firearms at his apartment at the Vibe at Kellswater Apartment Homes in Kannapolis. In February 2020, investigators conducted surveillance and a subsequent trash pull from Hamilton’s apartment complex after observing him discarding two trash bags from his truck into a public trash compactor. Contents of the bags later tested positive for traces of cocaine prompting the investigators to obtain search warrants for Hamilton’s truck and apartment.
On February 13, 2020, investigators executed the search warrants. A search of the apartment yielded large quantities of suspected heroin, suspected crack cocaine, and suspected cocaine hydrochloride, as well as a small amount of marihuana, numerous prescription pills, and supplies commonly used in the manufacturing of crack cocaine. A large amount of U.S. currency and a Glock .40 caliber firearm were also located in the apartment. The suspected heroin and cocaine were sent to the U.S. Customs and Border Protection Laboratories and Scientific Services Directorate in Savannah, Georgia, which later confirmed that various quantities of the substances contained fentanyl, cocaine, cocaine base, benzocaine, cocaine hydrochloride or mixtures thereof.
Hamilton, age 38, was charged with one count of possession with intent to distribute 280 grams or more of cocaine base, one count of possession with intent to distribute 400 grams or more of fentanyl, one count of possession of a firearm in furtherance of a drug trafficking crime, and one count of felon in possession of a firearm. On November 11, 2020, Hamilton pled guilty to one count of possession with intent to distribute 400 grams or more of fentanyl and one count of felon in possession of a firearm.
Hamilton was a convicted felon at the time of these offenses, having been convicted of Accessory After the Fact to Second Degree Murder, Assault with a Deadly Weapon with Intent to Kill, Discharging a Weapon Into an Occupied Dwelling or Moving Vehicle, Common Law Robbery, Second Degree Kidnapping, and Attempted Robbery with a Dangerous Weapon in 2011 in the Superior Court of Cabarrus County. Accordingly, at sentencing, the Court determined that Hamilton was an Armed Career Criminal.
In addition to the term of imprisonment, United States District Judge Loretta C. Biggs ordered Hamilton to serve five years of supervised release and to pay a $200 special assessment to the United States.
Sandra J. Hairston, Acting United States Attorney for the Middle District of North Carolina, made the announcement. The case was investigated by Homeland Security Investigations, along with the Kannapolis Police Department, and the federal Bureau of Alcohol, Tobacco, Firearms and Explosives. The case was prosecuted by Assistant U.S. Attorney Craig M. Principe.
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Browning Woman Sentenced to 8 Years in Prison for ManslaughterRead the Press Release
GREAT FALLS – Danielle Marie Marceau, also known as Danielle Marie Comesatnight, 35, of Browning, was sentenced on July 29, 2021 to 97 months in federal prison for fatally stabbing another individual during an argument. Marceau was also sentenced to three years of supervised release and ordered to pay $11, 735.90 in restitution by Chief U.S. District Judge Brian Morris.
In June 2020, Blackfeet Law Enforcement Services responded to Marceau’s residence in Browning, on the Blackfeet Indian Reservation, to conduct a welfare check on the victim. Officers found the victim’s body in the residence and determined the last time the victim had been seen alive was late on May 30, 2020 with Marceau. Both were intoxicated and had been arguing. Marceau admitted to killing the victim and that she had used a knife to stab the victim during an argument. In the days following the incident, Marceau told multiple family members they had been in a fight and that she stabbed the victim.
The defendant previously pleaded guilty to voluntary manslaughter.
Assistant U.S. Attorney Kalah A. Paisley prosecuted the case, which was investigated by the Federal Bureau of Investigation, Blackfeet Law Enforcement Services and Great Falls Police Department.
Broward Resident Pleads Guilty to Conspiracy to Commit Wire FraudRead the Press Release
Miami, Florida – Fifty-year old Broward County resident Jason Ganton pled guilty yesterday to participating in a fraud scheme that bilked investors out of more than $900,000.
During yesterday’s hearing before U.S. Magistrate Judge Bruce Reinhart in West Palm Beach, Ganton admitted his role in the scheme, which ran from 2015 to 2019. This included making baseless promises to would-be investors about the profitability of NIT Enterprises, a Palm Beach company that falsely marketed itself as being on the cusp of developing and producing radiation protective materials using an innovative technology. Ganton, who was not a licensed securities sales agent, also admitted to lying to investors by telling them that NIT was on the verge of making an initial public offering of stock. This created a false expectation that investors would double or triple their investments in a short amount of time. In fact, there was no IPO on the horizon for NIT. Ganton admitted that he reached most of his victims through cold calls and that he personally profited from the investor funds.
Ganton pled guilty to one count of conspiracy to commit wire fraud. U.S. District Judge Aileen Cannon, who sits in Fort Pierce, Florida, will sentence Ganton on a date to be announced. Ganton faces a maximum sentence of 20 years in federal prison.
As to the other defendants named in the information, the charges are mere allegations. Those defendants are presumed innocent unless and until proven guilty in a court of law.
The U.S. Securities and Exchange Commission (SEC) filed a parallel civil enforcement action against Ganton and others related to this activity.
Juan Antonio Gonzalez, Acting United States Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, FBI Miami, and Ronald L. Rubin, Commissioner, Florida Office of Financial Regulation (OFR), announced the guilty plea.
FBI Miami and OFR investigated this matter. SEC Miami Regional Office assisted.
Assistant U. S. Attorney Lothrop Morris is prosecuting this 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 no. 20-cr-80095.
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Boston Man Sentenced for Being a Felon in Possession of a Firearm and Failing to Register as a Sex OffenderRead the Press Release
BOSTON – A Boston man was sentenced yesterday in federal court in Boston for illegally possessing a firearm and ammunition and failing to register as a sex offender.
Shane Brown, 35, was sentenced by U.S. District Court Judge William G. Young to 37 months in prison and five years of supervised released. On March 10, 2021, Brown pleaded guilty to one count of being a felon in possession of a firearm and one count of failing to register as a sex offender in violation of the Sex Offender Notification and Registration Act (SORNA).
Brown, who was convicted of a sex offense in Virginia in 2013, moved from Virginia to Boston in or around May 2020. In May and June 2020, Brown was employed in security work around Greater Boston. Brown failed to register as a sex offender in Massachusetts prior to his arrest on state charges on July 2, 2020. At the time of his state arrest, an SCCY Industries, model CPX-2, 9mm caliber pistol loaded with seven 9mm Luger cartridges was found in Brown’s waistband. Due to a previous conviction for a crime punishable by more than one year in prison, Brown is prohibited from possessing firearms and ammunition.
Acting United States Attorney Nathaniel R. Mendell; John Gibbons, U.S. Marshal for the District of Massachusetts; Thomas L. Foster, U.S. Marshal for the Western District of Virginia; James Ferguson, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms & Explosives, Boston Field Division; and Boston Police Acting Commissioner Gregory Long made the announcement today. Assistant U.S. Attorney Elianna Nuzum of Mendell’s Major Crimes Unit prosecuted the case.
This case is part of Project Safe Neighborhoods (PSN), the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
Antitrust Division Observes National Whistleblower Appreciation DayRead the Press Release
The Antitrust Division today commemorates National Whistleblower Appreciation Day, which celebrates individuals who act with courage to speak out and report crimes, including antitrust violations like price-fixing, bid rigging and market allocation conspiracies. Collusion among competitors undermines fair competition and harm consumers, and individuals who step forward to shine a light on illegal practices deserve recognition. This year marks the 243rd anniversary of the United States’ first whistleblower law and also the first year for the Criminal Antitrust Anti-Retaliation Act (CAARA), signed into law on Dec. 23, 2020.
“We acknowledge whistleblowers’ courage and conviction in the face of adversity — their protection has been critical in exposing illegal activity,” said Acting Assistant Attorney General Richard A. Powers for the Justice Department's Antitrust Division. “This year marks another milestone for these protections with the passage of the Criminal Antitrust Anti-Retaliation Act, a law that will further our efforts to root out antitrust crimes that undermine our economy and cheat American consumers, workers, and taxpayers of the benefits of free and fair competition.”
CAARA provides legal protections for employees who blow the whistle on criminal antitrust violations by prohibiting employers from taking punitive actions against whistleblowers for reporting these violations to their employer or assisting a federal government investigation into a criminal antitrust violation. The law protects employees, contractors, subcontractors and agents of the employer. Detecting antitrust violations can prevent or reduce harm to victims of antitrust crimes. For example, by some estimates, eliminating bid rigging could reduce government procurement costs by 20% — a significant sum when the budget for discretionary spending on public procurement is more than $580 billion, as it was in 2019.
Consistent with President Biden’s Executive Order on Promoting Competition in the American Economy, the Antitrust Division will continue to work in partnership with our colleagues at the U.S. Department of Labor to effectively implement CAARA’s whistleblower protections, including by offering antitrust training and providing guidance on federal antitrust law to the officials who administer CAARA at the Occupational Health and Safety Administration. To learn more about how to seek whistleblower protection under CAARA, please go to https://www.whistleblowers.gov/complaint_page.
The Antitrust Division maintains a Citizen Complaint Center, where concerned citizens may report antitrust concerns via email, U.S. mail or phone. The Procurement Collusion Strike Force, a department initiative led by the Antitrust Division, also encourages citizens to report complaints about antitrust and other crimes that affect government procurement at all levels — federal, state and local.
Thursday 29 July 2021
Wholesale Supplier of Narcotics to East Baltimore Monument Street Drug Trafficking Organization Sentenced to More Than Eight Years in Federal Prison and Co-Defendant Drug Distributor Pleads Guilty to His Role in the Drug ConspiracyRead the Press Release
Baltimore, Maryland – U.S. District Judge Ellen L. Hollander sentenced Derek Crosby, age 40, of Baltimore, yesterday to 102 months in federal prison, followed by four years of supervised release for conspiracy to distribute fentanyl, heroin, cocaine, and crack cocaine in the Monument Street area of East Baltimore, and for possession with intent to distribute fentanyl.
Last week, co-defendant Malik Williams, a/k/a “Freaky,” age 32, of Baltimore pleaded guilty to conspiracy to distribute and possess with the intent to distribute cocaine, and to knowingly and intentionally possessing with intent to distribute cocaine.
The sentence and guilty plea 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; and Commissioner Michael Harrison of the Baltimore Police Department.
“There is no question that the excessive amount of violence in Baltimore stems in part from the drug trade, and getting wholesale narcotics dealers like Derek Crosby off the streets is an important component of our efforts to address the murders and shootings that steal lives and undermine our communities,” said Acting United States Attorney Jonathan Lenzner. “This Monument Street case is the kind of impactful investigation that federal, state and local partners can build through collaboration and a dedicated commitment to improving our communities.”
According to Crosby and Williams’ guilty pleas, in July of 2018, Drug Enforcement Administration (“DEA”) Strike Force Group 1 began an investigation of the Monument Street corridor in East Baltimore, which is known to support a high volume of street-level drug distribution and acts of violence associated with the drug trafficking. During the investigation, law enforcement identified multiple street-level drug trafficking “shops,” with the two most prominent located in the 400 block of North Montford Avenue at Jefferson Street (“the Montford DTO”) and in the 2400 block of East Monument Street at Port Street (the “Out the Mud,” or “OTM DTO”).
As detailed in their plea agreements, investigators identified Crosby as a wholesale distributor of cocaine, crack cocaine, heroin, and fentanyl and as a source of supply of the street-level Montford DTO, among others. Williams was identified as a drug distributor for the OTM DTO who agreed with his co-conspirators to acquire and to assist in distributing controlled substances to other persons. Investigators intercepted calls between Crosby and his co-conspirators and between Williams and his co-conspirators, discussing the distribution of drugs, including cocaine, crack cocaine, fentanyl and heroin.
Specifically, Crosby admitted that he owned a stash house in the 1700 block of Dallas Street in Baltimore, which he and his co-conspirators used to meet with customers and conduct drug transactions. According to his plea agreement, on June 19, 2019, law enforcement executed a search warrant at the Dallas Street residence owned by Crosby and recovered 677 grams of a fentanyl and heroin mixture, which Crosby admits he possessed with the intent to distribute for sale, and approximately 2.4 grams of crack cocaine. On June 21, 2019, a search warrant was executed on Crosby’s vehicle and law enforcement recovered a stolen .40 caliber semi-automatic pistol from a hidden compartment in the center console area. Crosby knew that he was prohibited from possessing a firearm as the result of a previous felony conviction. Further, Crosby admitted that he possessed the firearm in connection to his drug trafficking.
Throughout the course of his involvement in the conspiracy, it was reasonably foreseeable to Crosby, and within the scope of the conspiracy that he or other members of the conspiracy would distribute more than five kilograms of cocaine, and at least 400 grams of fentanyl, as well as quantities of crack cocaine and heroin, during the course of and in furtherance of the conspiracy.
Williams admitted that on October 30, 2018, he directed an undercover detective to a co-conspirator to purchased what the undercover detective thought was heroin, but was instead ten gelatin capsules containing a mixture of tramadol and fentanyl. On February 21, 2019, Williams sold an undercover detective four green top vials of cocaine. On June 25, 2019, Williams was arrested in the 2400 block of Monument Street and when Williams was searched, investigators recovered 48 grey top vials containing cocaine and 16 gel caps containing fentanyl. Williams admitted that on each of these three occasions he possessed the fentanyl and the cocaine with the intent to distribute them for sale.
Throughout the course of Williams’ involvement in the conspiracy, it was reasonably foreseeable to Williams, and within the scope of the conspiracy that he or other members of the conspiracy would distribute between 500 grams and two kilograms of cocaine, as well as quantities of crack cocaine, heroin and fentanyl, during the course of and in furtherance of the conspiracy.
Of the 25 defendants indicted in this case, 24—including Crosby and Williams—have pleaded guilty or been found guilty at trial. The remaining defendants have trial dates in November 2021.
Williams and the government have agreed that, if the Court accepts the plea, Williams will be sentenced to five years in federal prison. Judge Hollander has scheduled sentencing for Williams on September 17, 2021, at 2:00 p.m.
This prosecution was brought as a part of the Department of Justice’s Organized Crime Drug Enforcement Task Forces (OCDETF) Co-located Strike Forces Initiative, which provides for the establishment of permanent multi-agency task force teams that work side-by-side in the same location. This co-located model enables agents from different agencies to collaborate on intelligence-driven, multi-jurisdictional operations against a continuum of priority targets and their affiliate illicit financial networks. These prosecutor-led co-located Strike Forces capitalize on the synergy created through the long-term relationships that can be forged by agents, analysts, and prosecutors who remain together over time, and they epitomize the model that has proven most effective in combating organized crime. The specific mission of the Baltimore OCDETF Strike Force is to reduce violent, drug-related, and gang crime in the Baltimore area and surrounding region.
Acting United States Attorney Jonathan F. Lenzner commended the DEA and the Baltimore Police Department for their work in the investigation. Mr. Lenzner thanked Assistant U.S. Attorneys LaRai Everett and James T. Wallner, who are prosecuting the case.
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Union County Man Admits Conspiring to Commit Bank Fraud Using Checks Stolen from MailRead the Press Release
NEWARK, N.J. – A Union County, New Jersey, man admitted today to conspiring to commit bank fraud by soliciting U.S. Postal Service (USPS) employees to steal check books from the mail and depositing fraudulent checks, Acting U.S. Attorney Rachael A. Honig announced.
Brian Previlon, 28, of Elizabeth, New Jersey, pleaded guilty by videoconference before U.S. District Judge Kevin McNulty to an information charging him with one count of conspiracy to commit bank fraud.
According to documents filed in this case and statements made in court:
Beginning in summer 2019 through Oct. 22, 2019, Previlon conspired to fraudulently obtain money from victim financial institutions by, among other things, depositing checks stolen from the mail into accounts at victim financial institutions and withdrawing funds from those accounts before the victim financial institutions identified the fraudulent checks and blocked further withdrawals. Previlon and his co-conspirators arranged for USPS employees to steal blank check books from the mail in exchange for cash payments. USPS employees provided the checks to Previlon and his co-conspirators, who fraudulently forged the signatures of the accountholders and negotiated the checks by making them payable to individuals. Previlon and his co-conspirators obtained and attempted to obtain approximately $38,364 from victim financial institutions.
The conspiracy charge to which Previlon pleaded guilty is punishable by a maximum potential penalty of 30 years in prison and a fine of up to $1 million. Sentencing is scheduled for Dec. 3, 2021.
Acting U.S. Attorney Honig credited postal inspectors of the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Rodney M. Hopkins, and special agents with the USPS-Office of Inspector General, Northeast Area Field Office, under the direction of Special Agent in Charge Matthew Modafferi, with the investigation leading to today’s plea. She also thanked the U.S. Secret Service, the New Jersey State Police, the Elizabeth Police Department, and the Secaucus Police Department for their assistance.
The government is represented by Assistant U.S. Attorney Elaine K. Lou of the Special Prosecutions Division in Newark.
Defense counsel: Georgina Giordano Pallitto Esq., Newark
U.S. Attorney issues update on action taken to prevent Paycheck Protection Program fraudRead the Press Release
ATLANTA – Acting U.S. Attorney Kurt Erskine issued an update on his office’s efforts to combat fraud related to schemes targeting the Paycheck Protection Program (PPP), a loan program created by Congress to help small businesses pay payroll, interest on mortgages, rent, and utilities during the COVID-19 pandemic.
“Along with our federal, state and local law enforcement partners, we continue to remain focused on investigating and prosecuting crimes involving PPP fraud,” said Acting U.S. Attorney Kurt R. Erskine. “Unfortunately, when criminals steal these funds, they take them out of the hands of those suffering financial hardship. Criminals should understand that the diversion of taxpayer money meant to help small businesses survive this crisis will be fully investigated and prosecuted.”
The U.S. Attorney’s Office for the Northern District of Georgia has charged dozens of people with federal crimes related to PPP fraud, including bank fraud, conspiracy, and money laundering. The cases involve a variety of criminal conduct, including business owners who inflated their payroll expenses to obtain larger loans than they otherwise would have qualified for, serial fraudsters who used shell companies to apply for loans, and organized criminal networks that submitted identical loan applications and supporting documents on behalf of more than one company. Most charged defendants not only obtained the loan proceeds under false pretenses, but they also used the loan proceeds for prohibited purposes, such as the purchase of houses, cars, jewelry, and other luxury items.
The PPP fraud cases prosecuted by The U.S. Attorney’s Office for the Northern District of Georgia include the following:
- United States v. Darrell Thomas, et al.: Twenty-two defendants were charged in an $11.1 million PPP loan fraud scheme orchestrated by Duluth, Georgia resident Darrell Thomas. Thomas and his team applied for fraudulent PPP loans on behalf of 14 businesses located in seven different states. Each loan application claimed that the businesses had between 59 and 69 employees and attached forged IRS tax forms and either a fake bank statement or payroll expense spreadsheet, many of which were substantively identical in multiple fraudulent applications. In reality, none of the businesses had employees or payroll expenses. After the PPP loan proceeds were deposited into the businesses’ accounts, the business owners transferred more than $5.5 million to accounts controlled by Thomas, and the funds were used to purchase luxury vehicles, jewelry, and to pay for other personal expenses. As a result of the investigation, the United States seized nearly $4 million in PPP funds, and six participants in the scheme, including Thomas, have pleaded guilty.
- U.S. v. Rodericque Jarmaine Thompson, et al.: Nine individuals, including the ringleader, Rodericque Jarmaine Thompson, have pleaded guilty to various federal charges arising from multiple bank-fraud conspiracies designed to obtain PPP loans under false pretenses. Each of the loan applications contained identical false information. For example, each loan application falsely claimed that the business had 16 employees and a monthly payroll of $120,000. Each application was supported by fraudulent quarterly tax returns that claimed the business owner had paid $358,819 in wages per quarter. In the application, the business owner swore that the loan proceeds would be used for payroll, utilities, lease payments, consistent with the PPP rules. The business owners agreed to kickback up to 50 percent of the loan amount to Thompson, as a fee for helping them obtain the loans. After receiving the loans, the business owners wrote multiple checks for $8,333.33 to individuals selected by Thompson, or to their friends and family members. All of the checks claimed to be for “payroll,” even though the individuals who received the checks were not employed by the businesses.
- U.S. v. Alicia Quarterman, et al.: The U.S. Postal Inspection Service and the Drug Enforcement Administration executed a search warrant at the home of Alicia Quarterman in Fayetteville, Georgia in connection with an ongoing narcotics trafficking investigation. A package containing methamphetamine hidden in dog food containers had been mailed to Quarterman’s home. As part of the search, law enforcement seized Quarterman’s cell phones and discovered a handwritten ledger with the personal and banking information of several individuals. That ledger and a subsequent search of Quarterman’s cell phone revealed an alleged Economic Injury Disaster Loans (EIDL) and PPP loan fraud scheme devised by Quarterman and Katrina Lawson of Houston, Texas, a former deputy sheriff for Fulton County. The scheme involved the submission of fraudulent business loan applications on behalf of their friends and family who did not actually own businesses. In total, the scheme involved 50 different individuals, including India Middleton of Accokeek, Maryland (a deputy sheriff in Arlington County, Virginia); James McFarland, Tranesha Quarterman (a former Army military policeman), Darryl Washington, Adarin Jones, and Katie Quarterman of Atlanta, Georgia; Nikia Wakefield of Rockville, Maryland; and Victor Montgomery of Washington, D.C. The ten defendants were indicted on March 16, 2021 on charges of wire fraud, bank fraud, mail fraud, money laundering, and conspiracy to commit wire fraud for attempting to steal over $774,000. The defendants used the loan proceeds to purchase luxury vehicles, a motorcycle, and an all-terrain four-wheeler.
- U.S. v. Maurice Fayne: Maurice Fayne, who starred in the reality TV show Love & Hip Hop: Atlanta, pleaded guilty to bank fraud and making false statements to a financial institution in connection with a fraudulent $3.7 million PPP loan application. Fayne falsely claimed that his trucking business had 107 employees and an average monthly payroll of $1,490,200. Fayne certified that the PPP loan proceeds would be used to “retain workers and maintain payroll or make mortgage interest payments, lease payments, and utility payments, as specified under the Paycheck Protection Program Rule.” Instead, Fayne used the PPP loan proceeds to pay his past-due child support, pay restitution owed in a previous fraud case, make payments to associates who helped him run a Ponzi scheme, start a new business, purchase jewelry, and lease a Rolls-Royce. In addition, Fayne pleaded guilty to wire fraud and conspiracy in connection with a Ponzi scheme that caused approximately 20 people to invest over $5 million in Fayne’s fictitious trucking business. Fayne promised that he would use the investors’ money to operate the business. Instead, Fayne used the investors’ money to pay his personal debts and expenses, and to fund his extravagant lifestyle.
Indictments and other criminal charges referenced above are merely allegations, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
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.
Two Former Federal Medical Center Correctional Officers Indicted for Civil Rights Violations, including Sexual Abuse of InmatesRead the Press Release
LEXINGTON, Ky. – In separate indictments, two former Correctional Officers, who worked for the Bureau of Prisons’ Federal Medical Center in Lexington, have been indicted for federal civil rights and sexual abuse violations.
A federal grand jury sitting in Lexington returned an indictment charging Christopher Brian Goodwin, 45, of Winchester, Ky., of one count of deprivation of rights under color of law, one count of aggravated sexual abuse by force, seven counts of abusive sexual contact, three counts of sexual abuse of a ward, and one count of providing a prohibited object to an inmate.
Goodwin’s indictment alleges that on several occasions, between April 2019 and September 2019, he engaged in sexual conduct with four inmates in BOP custody. The indictment alleges that on at least one of those occasions, he sexually abused an inmate by using a threat that if the victim did not comply, they would be subjected to death, bodily injury, or kidnapping. Goodwin is also alleged to have provided cigarettes to an inmate
In a separate indictment, Hosea Lee, Jr., 42, of Phenix City, Al., was charged with two counts of deprivation of rights under color of law, two counts of aggravated sexual abuse by force or threat, eight counts of sexual abuse of a ward, two counts of abusive sexual contact, and one count of providing a prohibited object to an inmate.
Lee’s indictment alleges that, between August 2019 and December 2019, he engaged in sexual conduct with five inmates in BOP custody. It is alleged that Lee sexually abused two of the victims by using a threat that their families and children would be killed or harmed if they did not comply. Lee’s indictment also alleges that he was a drug treatment specialist and illegally provided Suboxone to an inmate, among other prohibited items.
Carlton S. Shier, IV, Acting United States Attorney for the Eastern District of Kentucky; William J. Hannah, Special Agent in Charge, Department of Justice Office of the Inspector General, Chicago Filed Office; and Edward J. Gray, Acting Special Agent in Charge, FBI, Louisville Field Office, announced the indictment.
The investigation preceding the indictment was conducted by the DOJ OIG and the FBI. The cases are being handled by Assistant U.S. Attorneys Tashena Fannin and Kate K. Smith.
Goodwin is scheduled to appear for his initial appearance on Friday, July 30 in Lexington, and Lee is scheduled to appear for his initial appearance on Friday, August 6, also in Lexington. For their respective charges, they each face up to one year in prison of the deprivation of rights under color of law charge; up to life in prison for the aggravated sexual abuse charges; up to 15 years for the sexual abuse of a ward charges; up to two years for the sexual abuse by force; up to 20 years for providing a narcotic to an inmate charge; and up to six months for providing other prohibited objects to an inmate. However, any sentence following a conviction would be imposed by the Court, after its consideration of the U.S. Sentencing Guidelines and the federal sentencing statutes.
Any indictment is an accusation only. A defendant is presumed innocent and is entitled to a fair trial at which government must prove guilt beyond a reasonable doubt.
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Tucson Woman Indicted for Alien Smuggling Leading to DeathRead the Press Release
TUCSON, Ariz. – On Tuesday, Michelle Sunshine Betters, 44, from Tucson, Arizona, appeared telephonically in federal court on charges relating to the transportation of illegal aliens while placing a person’s life in jeopardy, causing bodily injury, and resulting in death. Betters was previously indicted on three counts by a federal grand jury. The district court ordered Betters detained pending trial, which is scheduled for September 8.
“These events highlight the incredibly dangerous nature of human smuggling attempts,” said Acting United States Attorney Glenn B. McCormick. “Illegally transporting non-citizens is hazardous for all involved – the transporter, the non-citizens, and the general public. The possibility of a tragedy is always present, and it sadly became a reality this time.”
On June 3, 2021 the Tohono O’odham Police Department responded to a two-vehicle crash on State Route 86. The investigation revealed that Betters was driving a car that sideswiped a truck, then left the roadway and struck a tree. There were two other passengers in the car, both of whom were determined to be undocumented non-citizens. One of the non-citizens was declared deceased at the scene, and the other was transported to the hospital to be treated for various injuries.
“Unfortunately, this is yet another example of the dangers of human smuggling resulting in a tragic death,” said special agent in charge, Scott Brown for HSI Phoenix. “HSI is committed to investigating these human smuggling organizations that prey on the vulnerable and have no regard for the sanctity of life. We will stop at nothing to bringing those involved to face justice.”
An indictment is simply a method by which a person is charged with criminal activity and raises no inference of guilt. An individual is presumed innocent until evidence is presented to a jury that establishes guilty beyond a reasonable doubt.
The Tohono O’odham Police Department and Homeland Security Investigations are conducting the investigation in this case. The Tucson Office of the United States Attorney’s Office, District of Arizona, is handling the prosecution.
CASE NUMBER: CR 21-01526-SHR (BGM)
RELEASE NUMBER: 2021- 046_Betters# # #
For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.Troy Man Pleads Guilty to Trafficking a Kilogram of HeroinRead the Press Release
ALBANY, NEW YORK – Jose Leon Roldan, age 42, of Troy, New York, pled guilty today to conspiring to distribute a kilogram of heroin.
The announcement was made by Acting United States Attorney Antoinette T. Bacon; Special Agent in Charge Ray Donovan, U.S. Drug Enforcement Administration (DEA), New York Division; and Rensselaer County Sheriff Pat Russo.
In pleading guilty, Leon Roldan admitted to working with his father, Carlos Leon Rivera, and Mario Figueroa-Portalatin, to sell heroin in Troy, from November 2019 to March 30, 2020. Jose Leon admitted to regularly traveling to New York City with his father, where they would acquire heroin from Figueroa’s source of supply. They brought the heroin back to Troy, where they and Figueroa prepared and packaged it for sale to customers.
Leon faces at least 10 years and up to life in prison, as well as post-release supervision of at least 5 years and up to life, when Chief United States District Judge Glenn T. Suddaby sentences him on December 8, 2021. 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.
Figueroa-Portalatin, age 42, of Troy, pled guilty on August 11, 2020 to conspiring to distribute 1 kilogram or more of heroin, and is scheduled for sentencing on November 4, 2021.
Leon Rivera, age 63, of Troy, pled guilty on June 9, 2021 to conspiring to distribute 1 kilogram or more of heroin, and is scheduled for sentencing on October 28, 2021.
This case was investigated by the DEA and the Rensselaer County Sheriff’s Office, and is being prosecuted by Assistant U.S. Attorney Michael Barnett
Three charged in conspiracy to purchase $500,000 in weapons for cartelRead the Press Release
LAREDO, Texas – Three men are now facing federal charges for their roles in a conspiracy on behalf of Cartel del Noreste (CDN), announced Acting U.S. Attorney Jennifer B. Lowery.
Luis Ramos, 43, Rio Bravo, is expected to make his initial appearance before U.S. Magistrate Judge Christopher A. Dos Santos in Laredo today at 1:30 p.m. Authorities took him into custody Tuesday, July 27. Also charged and previously arrested are Mexican national Manuel Perez-Ortiz, 39, and Arturo Mata Jr., 55, Rio Bravo. They are expected again in federal court Aug. 12. A federal grand jury retuned the five-count indictment May 18.
The charges allege that negotiations to purchase $500,000 worth of high-powered weapons occurred in May 2020. The weapons allegedly included machine guns, grenades, military-style rifles and rocket-propelled launchers. According to the indictment, the plan was for the weapons to be purchased in the United States and then smuggled into Mexico. There, those associated with CDN planned to use them in battles against rival cartels to further their drug smuggling activities, according to the charges.
CDN allegedly sent Perez-Ortiz to conduct the transaction in Laredo. On June 19, 2020, Ramos and Mata drove Perez-Ortiz to and from the meetings discussing the exchange, according to the indictment. Mata also allegedly assisted in providing counter-surveillance during the operation.
Law enforcement apprehended Ramos and Perez-Ortiz June 19, 2020. At that time, authorities seized $500,000, according to the charges.
All men are charged with conspiracy to commit money laundering and conspiracy to export firearms to Mexico. Upon conviction, they face up to 20 years in prison for the money laundering conspiracy as well as a maximum $500,000 fine or twice the value of the property involved in the transaction. The indictment also alleges three substantive money laundering counts, including international money laundering, which carry the same potential penalty. The conspiracy to export firearms charge carries a potential punishment of five years and a maximum $250,000 fine.
The investigation was part of the Blue Indigo task force and brought as part of the Organized Crime Drug Enforcement Task Force (OCDETF) investigation dubbed Operation Noreste. OCDETF is the largest anti-crime task force in the country. Its mission is to disrupt and dismantle the most significant drug trafficking and transnational criminal organizations that threaten the United States through prosecutor-led, intelligence-driven, multi-agency task forces that leverage the authorities and expertise of federal, state, and local law enforcement.
The Drug Enforcement Administration and the Laredo Police Department conducted the investigation of this case with the assistance of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Customs and Border Protection and the U.S. Marshals Service. The Blue Indigo task force also includes Border Patrol.
Assistant U.S. Attorney Jennifer Day is prosecuting this case.
An indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.
Temple Hills Felon Who Discharged a Firearm During Robbery of a Pharmacy While Demanding Oxycodone and Money from the Register Sentenced to 11 Years in Federal PrisonRead the Press Release
Greenbelt, Maryland – U.S. District Judge Theodore D. Chuang today sentenced Tyrek Montez Arrington, age 24, of Temple Hills, Maryland, to 11 years in federal prison, followed by five years of supervised release, on federal charges for robbing a pharmacy, for discharging a firearm in furtherance of a violent crime, and for being a felon in possession of a firearm. Arrington was convicted of those crimes by a federal jury on April 7, 2021, after two hours of deliberation.
The sentence was announced by Acting United States Attorney for the District of Maryland Jonathan F. Lenzner; Special Agent in Charge Thomas J. Sobocinski of the Federal Bureau of Investigation, Baltimore Field Office; and Chief Malik Azziz of the Prince George’s County Police Department.
According to evidence presented at Arrington’s three-day trial, on October 15, 2019, Arrington entered a drug store in Clinton, Maryland wearing a surgical mask and black latex gloves. Armed with a handgun, Arrington walked to the pharmacy area and entered the pharmacist booth. Arrington pointed the gun at the pharmacist and demanded oxycodone from a safe. Arrington then demanded that the pharmacist open the cash register. Arrington fired one round into the ceiling then took the cash drawer from the register. Witnesses testified that Arrington attempted to flee with the cash drawer taken from the register. Two law enforcement officers encountered Arrington in the store as he was attempting to flee. One officer saw Arrington with the cash drawer in his hand and ordered Arrington to the ground. Arrington dropped the cash drawer and the handgun and tried to evade the first officer, but ran into the second officer and was arrested.
According to trial evidence, law enforcement collected a live round and a spent shell casing from behind the counter. They also recovered the handgun that Arrington dropped—a loaded .22-caliber handgun.
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. Project Safe Neighborhoods (PSN) is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
Acting United States Attorney Jonathan F. Lenzner commended the FBI and the Prince George’s County Police Department for their work in the investigation. Mr. Lenzner thanked Assistant U.S. Attorneys Dwight Draughon and William D. Moomau, who prosecuted the case.
For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit www.justice.gov/usao-md and https://www.justice.gov/usao-md/community-outreach.
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Tampa Man Who Set Fire to Champs Store During Civil Disturbance Sentenced to Five Years in Federal PrisonRead the Press Release
Tampa, Florida – U.S. District Judge Thomas Barber has sentenced Terrance Lee Hester Jr. (21, Tampa) to five years in federal prison for damaging or destroying by fire a building used in interstate commerce. The court also ordered Hester to pay restitution and to serve three years of supervised release following completion of his prison sentence.
According to court documents, the events that led to Hester’s conviction occurred around midnight on May 31, 2020, in a shopping plaza located at 2301 East Fowler Avenue in Tampa. Simultaneously with a peaceful protest going on in the area, certain individuals began to loot and destroy property, including setting fire to the Champs Sports store located in the plaza. The building, which also housed other businesses, became fully engulfed in fire, resulting in major damage and loss of property. The loss to the building, the Champs Sports store, and the other businesses is estimated at $1.25 million.
Video footage obtained by investigators revealed that Hester tossed a flaming piece of cloth into the Champs Sports store through a broken window. Fire investigators determined that the fire originated inside the Champs Sports store, and Hester’s act caused or contributed to the cause of the fire.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Tampa Police Department, and Tampa Fire Rescue. It was prosecuted by Assistant United States Attorney Michael Sinacore.
Syracuse Tax Preparer Pleads Guilty to Filing False Tax Returns for Herself and OthersRead the Press Release
SYRACUSE, NEW YORK – Phoenix Phan, age 62, of Syracuse, pled guilty today to filing a false tax return for herself and to aiding and abetting the filing of a false tax return for a client. The announcement was made by Acting United States Attorney Antoinette T. Bacon and Thomas Fattorusso, Acting Special Agent in Charge, New York Field Office, Internal Revenue Service – Criminal Investigation (IRS-CI).
As part of her guilty plea, Phan admitted that she failed to report gross receipts on her personal income tax returns for tax years 2013-2017. She also admitted that she aided and assisted others in filing false federal income tax returns during the same time period, including by falsely reporting: (1) business income that the taxpayer did not earn; (2) rental losses; and/or (3) that the taxpayer had a filing status (e.g., head of household) that the taxpayer did not actually have.
Sentencing is set for November 30, 2021 before Senior United States District Judge Thomas J. McAvoy. Phan faces up to 3 years in prison on each count. The judge also could impose a term of supervised release of up to 1 year. In addition to imprisonment and supervised release, Phan faces a fine of up to $100,000 on each count and, as part of her plea agreement, Phan agreed to pay at least $222,999 in restitution to the IRS. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines and other factors.
This case was investigated by IRS-CI and is being prosecuted by Assistant U.S. Attorney Michael D. Gadarian.
St. Paul Man Sentenced to Prison for the Assault and Attempted Robbery of a Postal EmployeeRead the Press Release
MINNEAPOLIS – A St. Paul man was sentenced yesterday to 18 months in prison followed by three years of supervised release for assaulting and attempting to rob a postal employee.
According to court documents, on June 4, 2020, James Wilbert Jackson, Jr., 23, tried to pick up a package from a post office located in Oakdale, Minnesota, but the postal employee was not authorized to give Jackson the package because his name and address did not match the recipient or sender address on the package. Jackson left the post office and returned multiple times that same day, each time trying to convince the postal employee to give him the package. Shortly before the post office closed for the day, Jackson returned and again demanded the package. When the employee walked away, Jackson leapt over the service counter, followed the employee into the back office, and punched the employee repeatedly in the head. The two struggled and fell to the ground before postal employees were able to restrain Jackson. As a result of the assault, the employee suffered scrapes, abrasions, and bruises to his head and knees, as well as a badly broken finger that required surgery to repair. A subsequent search of the package Jackson was trying to retrieve showed that it contained approximately 500 grams of marijuana.
“This defendant attacked an innocent U.S. Postal Service employee, a public servant, who was simply doing his job,” said Acting U.S. Attorney W. Anders Folk. “Postal workers are frontline employees who serve the public during challenging times, particularly throughout the COVID-19 pandemic, and they deserve to be safe and free from violence as they carry out their duties.”
Acting U.S. Attorney W. Anders Folk for the District of Minnesota made the announcement after U.S. District Judge Patrick J. Schiltz sentenced the defendant.
This case was the result of an investigation conducted by the U.S. Postal Inspection Service and the Oakdale Police Department.
This case was prosecuted by Assistant U.S. Attorney Alexander D. Chiquoine.
South Padre Island man sentenced for child pornography convictionsRead the Press Release
BROWNSVILLE, Texas - A 25-year-old local man has been ordered to federal prison for receipt and possession of child pornography and transferring obscene material to a minor, announced Acting U.S. Attorney Jennifer B. Lowery.
Miguel Angel Lopez pleaded guilty Oct. 24, 2019.
Today, U.S. District Judge Fernando Rodriguez Jr. sentenced Lopez to a total of 180 months in federal prison. Lopez was further ordered to pay $36,000 in restitution to the victims and will serve 15 years on supervised release following completion of his prison term, during which time he will have to comply with numerous requirements designed to restrict his access to children and the internet. Lopez will also be ordered to register as a sex offender.
In January 2018, authorities initiated an investigation into child pornography sharing on the internet. This led them to the address of Lopez in Brownsville.
Law enforcement later executed a search at his residence and seized several electronic and digital devices. Forensic analysis resulted in the discovery of 63,975 unique images and 853 unique videos of child pornography.
Lopez will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
Homeland Security Investigations - Rio Grande Valley Child Exploitation Task Force conducted the investigation.
Assistant U.S. Attorney Ana C. Cano and Jason Corley are prosecuting the case, which was brought as part of Project Safe Childhood (PSC), a nationwide initiative the Department of Justice (DOJ) launched in May 2006 to combat the growing epidemic of child sexual exploitation and abuse. U.S. Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section leads PSC, which marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children and identifies and rescues victims. For more information about PSC, please visit DOJ’s PSC page. For more information about internet safety education, please visit the resources tab on that page.
Sioux City Man to Federal Prison for Meth TraffickingRead the Press Release
A man who conspired to distribute methamphetamine was sentenced on July 28, 2021, to six years in federal prison.
Derek Wilkens, 35, from Sioux City, Iowa, plead guilty on March 4, 2021, to conspiracy to distribute methamphetamine.
At the plea and sentencing hearings, evidence showed that between about May 2019 through about August 28, 2019, Wilkens and others distributed at least 3 pounds of methamphetamine. Evidence further showed that on August 28, 2019, law enforcement executed a search warrant at the residence of one of Wilken’s sources of supply in Sioux City, Iowa. During the execution of the search, Wilkens possessed approximately 88 grams of methamphetamine which he intended to distribute to others.
Sentencing was held before United States District Court Chief Judge Leonard T. Strand. Wilkens remains in custody of the United States Marshal until he can be transported to a federal prison. Wilkens was sentenced to 72 months’ imprisonment and a term of 3 years of supervised release following imprisonment. There is no parole in the federal system.
The case was prosecuted by Assistant United States Attorney Patrick T. Greenwood and was investigated by Tri-State Drug Task Force based in Sioux City, Iowa, that consists of law enforcement personnel from the Drug Enforcement Administration; Sioux City, Iowa, Police Department; Homeland Security Investigations; Woodbury County Sheriff’s Office; South Sioux City, Nebraska, Police Department; Nebraska State Patrol; Iowa National Guard; Iowa Division of Narcotics Enforcement; United States Marshals Service; South Dakota Division of Criminal Investigation; and Woodbury County Attorney’s Office.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 20-4038.
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Schenectady Man Sentenced to 10 Years for Receipt and Possession of Child PornographyRead the Press Release
ALBANY, NEW YORK – Chandler Whittaker, age 25, of Schenectady, New York, was sentenced today to 121 months in prison for receipt and possession of child pornography. 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).
As part of his previously entered guilty plea, Whittaker admitted that, between July and October 2014, and in January 2016, he downloaded several images of child pornography from the Internet. Whittaker also admitted to possessing hundreds of images and videos of child pornography on multiple electronic devices between December 2018 and February 2019.
Chief United States District Judge Glenn T. Suddaby also sentenced Whittaker to 20 years of supervised release and to pay restitution to the victims of his crimes. Whittaker will also be required to register as a sex offender upon his release from prison.
This case was investigated by the Rotterdam Police Department, the New York State Police, and the FBI’s Child Exploitation Task Force, and prosecuted by Assistant U.S. Attorney Rachel Williams as 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), and is designed to marshal 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.
Rutland Man Sentenced to 24 Months Imprisonment for Cocaine Base TraffickingRead the Press Release
The Office of the United States Attorney for the District of Vermont stated that Michael Goodnough, 46, of Rutland was sentenced by U.S. District Court Chief Judge Geoffrey Crawford to 24 months’ imprisonment and three years of supervised release, which will follow the term of imprisonment.
Goodnough previously pled guilty to distribution of cocaine base, which carried a maximum of up to twenty years imprisonment. According to court records, in October 2018, Goodnough sold a quantity of cocaine base to a confidential informant for $100 in the Beer King parking lot in Rutland. The government alleged that for several months in 2018, Goodnough regularly sold cocaine base in the Rutland area to support his own drug addiction.
After pleading guilty, Goodnough participated in the Federal Drug Court Program in Rutland, beginning in June 2019. Goodnough struggled in the program, with multiple relapses, failures to attend treatment sessions, and instances of dishonesty. On July 17, 2020, Goodnough was arrested, detained, and eventually discharged from the Federal Drug Court Program. If Goodnough had successfully completed the program, he would likely have received a time-served sentence.This matter was investigated by the Vermont State Police Narcotics Investigative Unit, the Federal Bureau of Investigation, and the Rutland City Police Department. This case was prosecuted on behalf of the government by Assistant U.S. Attorney Joseph Perella. Goodnough was represented by Federal Public Defender Michael Desautels of Burlington.
Rochester-Area Man Sentenced to Two Years in Prison for Fraud, Money Laundering and Tax OffensesRead the Press Release
SYRACUSE, NEW YORK – Michael Bartusek, age 52, of Fairport, New York, was sentenced today to two years in prison for wire fraud, money laundering, and filing a false tax return. The announcement was made by Acting United States Attorney Antoinette T. Bacon of the Northern District of New York; United States Attorney James P. Kennedy, Jr. of the Western District of New York; Janeen DiGuiseppi, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI); Acting Inspector in Charge Joshua McCallister, Boston Division, United States Postal Inspection Service (USPIS); and Thomas Fattorusso, Acting Special Agent in Charge, New York Field Office, Internal Revenue Service – Criminal Investigation (IRS-CI).
As part of his previously entered guilty plea, Bartusek admitted that from the summer of 2015 through the end of 2016, he defrauded his employer of approximately $776,000, which he used to invest in a high-risk scheme to purchase and sell diamonds from overseas, hoping to profit personally from their sale and return the money he stole from his employer before his fraud was discovered. Instead, the diamond investment failed, and the money was lost.
Bartusek also admitted that, as part of his diamond scheme, he and two others solicited investments for a company called Integra Diamonds by making materially false and fraudulent representations in an effort to recover investment funds that had been lost, including the money Bartusek stole from his employer. In addition to the fraud and money laundering, Bartusek filed false tax returns for tax year 2015 and underreported his total income that tax year by approximately $123,000, and underreported his total income for the 2016 tax year by approximately $46,000.
Senior United States District Judge Thomas J. McAvoy also sentenced Bartusek to a 3-year term of supervised release to begin following his term of imprisonment and to pay restitution to his victims totaling $973,922.
This case was investigated by the FBI, United States Postal Inspection Service, and IRS-CI. The case was prosecuted by Assistant U.S. Attorneys Michael D. Gadarian and Nicolas Commandeur of the Northern District of New York, and Assistant U.S. Attorney Charles Kruly of the Western District of New York.
Repeat offender sentenced to prison in Columbus gun trafficking caseRead the Press Release
COLUMBUS, Ga. – A convicted felon with a lengthy criminal history in the Columbus, Georgia, community was sentenced to federal prison today after an ATF-led investigation into gun trafficking.
Maurice Toney, 47, of Columbus, was sentenced to serve 63 months in federal prison to be followed by three years of supervised release by U.S. District Judge Clay Land after pleading guilty to possession of a firearm by a convicted felon. There is no parole in the federal system.
“Repeat criminal offenders caught in illegal possession of firearms in Columbus will face federal prosecution,” said Acting U.S. Attorney Peter D. Leary. “Our office is working closely with our local, state and federal law enforcement partners to prosecute the most violent and habitual felons that continually disregard the law and disrupt the community.”
“Prohibited individuals in possession of firearms are a danger to our communities,” said Assistant Special Agent in Charge John Schmidt, ATF Atlanta Field Division. “We will always work with our partners to identify and prosecute these types of people to make our citizens safer."
According to court documents, ATF conducted a gun trafficking investigation in the Columbus area in August and September 2020. Toney was under surveillance for suspected firearms and methamphetamine trafficking. A confidential informant (CI) purchased 46 grams of methamphetamine from Toney at a Columbus food mart. On the same day, the CI traveled with Toney to a Columbus residence to purchase a 20-gauge, pump-action shotgun and a .38SPL revolver from Toney. Then, the CI went with Toney to another Columbus residence to purchase a semi-automatic rifle with one magazine and 15 rounds of .22LR ammunition from Toney. Toney has a lengthy criminal history to include convictions for theft by taking, possession of a firearm by a convicted felon and habitual violator in the Superior Court of Muscogee County, Georgia. It is illegal for convicted felons to possess firearms.
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.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF).
Assistant U.S. Attorney Christopher Williams prosecuted the case for the Government.
Queens Sex Offender Sentenced to More Than 21 Years’ Imprisonment for Coercion and Enticement of a Minor and Distribution of Child PornographyRead the Press Release
Earlier today, in federal court in Brooklyn, Richard Palmer was sentenced to 262 months’ imprisonment by United States District Judge Carol Bagley Amon, following the defendant’s guilty plea in April 2021, to coercion and enticement of a child to engage in illegal sexual conduct and distribution of child pornography. As part of his sentence, Palmer must also serve five years’ supervised release following his imprisonment, during which time he must remain registered as a sex offender and have no unsupervised or unapproved contact with minors.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the sentence.
“Today, the defendant, a serial predator and registered sex offender, received a well-deserved, lengthy term of imprisonment for his efforts to convince a young child to engage in sexual acts by texting him thousands of obscene messages and photographs,” stated Acting United States Attorney Kasulis. “Protecting vulnerable, underage children from sexual exploitation will always be a high priority of this Office.” Ms. Kasulis extended her grateful appreciation to the FBI New York Child Exploitation and Human Trafficking Task Force for its investigative work and assistance.
According to court filings, in September 2019, an adult woman contacted the FBI and reported that Palmer had sent her unsolicited emails containing child pornography. Law enforcement subsequently conducted searches of Palmer’s residence in Maspeth, Queens, and his electronic devices. The searches revealed that Palmer had also sent thousands of text messages, including explicit and obscene photographs, to an 11-year-old child in an effort to convince that child to engage in sexual acts with him. At the time, Palmer was a registered sex offender who had been convicted in 2010 in Queens of attempted promotion of a sexual performance by a child.
This prosecution is part of Project Safe Childhood, a nationwide initiative led by the Department of Justice to combat the epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Assistant United States Attorney Devon Lash is in charge of the prosecution.
The Defendant:
RICHARD PALMER
Age: 40
Maspeth, QueensE.D.N.Y. Docket No. 19-CR-556 (CBA)
Polson Man Found Guilty of Drug PossessionRead the Press Release
Great Falls - A federal jury in Great Falls convicted Roy Allen Shostak, a 28 year-old resident of Polson, of Possession with Intent to Distribute Methamphetamine after a one-day trial. The defendant is being detained pending sentencing which U.S. District Chief Judge Brian Morris set for October 7, 2021.
Prosecutors presented evidence that in May 2020, Helena Police Department and members of the Missouri River Drug Task Force received information that Shostak was armed with a gun and selling drugs. Additionally, law enforcement officers were aware that the defendant had absconded from probation. Following observation of Shostak’s activities, officers arrested the defendant on outstanding warrants. Following the arrest, officers found a marijuana pipe although the defendant was not a holder of a medical marijuana car. The defendant’s care was seized pending a search warrant. While conducting a search warrant of the defendant’s car, officers found three plastic baggies of methamphetamine, a smartphone and a digital scale in a backpack that was located on the front passenger seat. Inside the glove box, officers located a hand-written bill of sale, a smartphone, a piece of paper containing Shostak’s social security number, date of birth, email address, and physical address and credit card number, and a used syringe in the center console.
Law enforcement obtained a warrant to search the phone and uncovered text messages between Shostak and third parties where Shostak discussed his trafficking of various drugs. The jury deliberated for 18 minutes before returning a verdict of guilty.
Assistant U.S. Attorney Jeff Starnes prosecuted the case which was investigated by the Helena Police Department and the Missouri River Drug Task Force.
Pittsburgh Man Off to Prison for Attempting to Rob a South Side Bank while in a WheelchairRead the Press Release
PITTSBURGH, PA – A former resident of Pittsburgh, Pennsylvania, has been sentenced in federal court to 46 months’ imprisonment and three years’ supervised release on his conviction of attempted bank robbery, Acting United States Attorney Stephen R. Kaufman announced today.
Senior United States District Judge Joy Flowers Conti imposed the sentence on Emanuel Luna, 56.
According to information presented to the court, on August 13, 2019, at approximately 3:19 p.m., Emanuel Luna, in a wheelchair, entered the First National Bank located at 114 E Carson Street. Mr. Luna, wearing dark pants, a dark hooded sweatshirt, tan undershirt, glass and a black hat, handed a note to the teller that stated: “I have a bomb if you don’t want to die you will give and it is in my backpack I will press the button and kill us all for no less than $50,000 dollars please try me.” The teller activated the alarm and used her telephone to call the manager.
The Court was further informed that upon seeing the teller begin to cry and before receiving money from the teller, Luna wheeled himself to the front door and exited the bank. Surveillance footage captured Mr. Luna exiting the bank, abandoning the wheelchair, and walking to the corner of 12th Street and Carson Street where he waited to board an Allegheny County Port Authority Bus, and also captured Mr. Luna on the bus.
The City of Pittsburgh Bureau of Police along with agents and task force officers with the Federal Bureau of Investigation, responded to the robbery. Investigators located the black wheelchair at the corner of E. Carson Street and 12th Street, and recovered a fingerprint from it, which matched Mr. Luna’s fingerprint. Mr. Luna was later apprehended by law enforcement and has been in custody since then.
At sentencing, Mr. Luna, through counsel acknowledged that it was a “really stupid crime” and “inconceivable” that he would get away with it.
The Court, in sentencing Mr. Luna to a within guideline range sentence, of 46 months imprisonment and three years supervised release, explained that the sentence balanced all of the factors the Court is to consider. The Court explained that the sentence reflects that this was a “very serious” offense, and that going into a bank and threatening to have a bomb is a “terrible situation” to put people under who have no way of knowing whether you actually have a bomb. The Court further stated that this type of sentence addresses the need to promote respect for the law, signaling to others that it is “not worth it to rob a bank.” The Court acknowledge that Mr. Luna, whose criminal history only started in his 50s, was given a sentence at the low end of the guideline range for a term of imprisonment, but the maximum amount of time on supervised release, taking into account the need to protect the community from Mr. Luna and ensure that he receives the services he needs to become a productive member of society upon release.
Assistant United States Attorney Rebecca L. Silinski prosecuted this case on behalf of the government.
The Federal Bureau of Investigation and City of Pittsburgh Bureau of Police conducted the investigation that led to the successful prosecution of Luna.
This case was brought as a part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-basedprogram 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.
Pendleton County man sentenced for firearms chargeRead the Press Release
ELKINS, WEST VIRGINIA – Devin Cory Teter, of Franklin, West Virginia, was sentenced today to 48 months of incarceration for a firearms charge, Acting U.S. Attorney Randolph J. Bernard announced.
Teter, 33, pled guilty in January 2021 to one count of “Unlawful Possession of a Firearm.” Teter, a person prohibited from having a firearm because of a prior conviction, admitted to having a 12-gauge shotgun in December 2019 in Hardy County.
Assistant U.S. Attorney Stephen D. Warner prosecuted the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated.
U.S. District Judge Thomas S. Kleeh presided.
Owner of Signature Nails Spa Indicted on Tax Evasion and Obstruction ChargesRead the Press Release
NASHVILLE – A federal indictment unsealed today charged Chieu K. Tran, 54, of Nashville, the owner of Signature Nails Spa, (Signature) with tax evasion and obstruction of justice charges, announced Acting U.S. Attorney Mary Jane Stewart for the Middle District of Tennessee. Tran was arrested by IRS Criminal Investigation Agents at his home this morning and will appear before a U.S. Magistrate Judge later today.
According to the indictment, Tran was the owner and operator of Signature Nails Salon in Nashville which provided manicure, pedicure and waxing services and employed approximately 25-50 nail technicians in any given year. Tran paid the nail technicians based on a commission of 60% and paid those wages by a combination of 50% cash and 50% check. For tax years 2014-2018, nail technicians were paid approximately $10.5 million.
In 2008, the Tennessee Department of Labor and Workforce Development (TNLWD) conducted an audit of Signature worker classifications and Tran was notified that his workers were to be classified as “employees” and that he was required to file quarterly reports to report the wages paid to them. Tran appealed the TNLWD’s decision, arguing that his workers were “independent contractors” and not “employees.” The TNLWD upheld the decision, and it became final. Tran then began reporting some of his employees’ wages but continued to classify other employees as independent contractors, despite the decision of the TNLWD.
In 2017, the TNLWD again audited Signature and found that Tran paid his workers cash that he had not reported and that he continued to misclassify some employees as independent contractors. The audit determined that Tran had underreported wages in 2014 by $987,203.80; underreported wages for 2015 by $1,075,718.40; and underreported wages in 2016 by $1,099,356.90.
The indictment alleges that Tran did not file federal employment tax returns reporting his employees’ wages and withholdings, as required, nor did he withhold employment taxes or pay the employer’s portion of employment taxes for wages paid to employees. According to the indictment, the tax loss attributable to eight separate quarters during tax years 2015 through 2018 was over $542,000.
The indictment also alleges that while knowing the IRS was conducting a criminal investigation of him, Tran instructed nail technicians to lie to the IRS about cash payments received as wages.
If convicted, Tran faces up to 5 years in prison on each tax evasion and employment tax fraud count and up to 2 years on the obstruction count, and up to a $250,000 fine.
This case was investigated by the IRS-Criminal Investigation. Assistant U.S. Attorneys Kathryn W. Booth and Stephanie N. Toussaint are prosecuting the case.
An indictment is merely an accusation. The defendant is presumed innocent until proven guilty in a court of law.
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