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11 August 2021
Justice Department Supports the Federal Reserve Board’s Proposed Rule on Debit Card Interchange Fees and Routing to Promote CompetitionRead the Press Release
Today, the Justice Department’s Antitrust Division filed a comment in support of the Federal Reserve Board of Governors’ (Board) notice of proposed rulemaking on Debit Card Interchange Fees and Routing. The Board’s proposed rule would require banks that issue debit cards (“issuers”) to give merchants a choice of debit networks for transactions made online and in circumstances where consumers pay without physically presenting their debit cards. By introducing choice, the proposed rule has the potential to reduce merchants’ transactional costs and ultimately save consumers money.
“We commend the Board for its efforts to promote competition in this important part of the debit card industry by ensuring that smaller debit networks will have a greater ability to compete for merchants’ business,” said Acting Assistant Attorney General Richard A. Powers of the Justice Department’s Antitrust Division. “There is limited competition to process online and other card-not-present debit transactions — which in 2019 accounted for over $1 trillion in transaction value. Consistent with President Biden’s Executive Order on Promoting Competition in the American Economy, the department looks forward to working with the Board on this and other efforts to foster competition.”
Section 1075 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Durbin Amendment”) requires issuers to make available at least two independent debit networks on the cards they issue so that merchants have a choice of debit networks when processing debit transactions. But this requirement has not been effective for online and other card-not-present transactions because many large issuers have not implemented necessary technological changes to permit debit networks other than Visa and Mastercard to process transactions. The Board’s proposal would clarify that the Durbin Amendment’s two-debit-network requirement applies with equal force to such transactions.
The department supports the Board’s proposed rule because it has the potential to increase competition by lowering one of many barriers to entry and expansion that new or smaller competitors face in this important segment of the debit card industry. At the same time, the department encourages the Board to consider whether there may be ways to improve upon the proposal. Specifically, the Board should consider whether the proposal is drafted broadly enough to capture all card-not-present transactions. In addition, incumbent industry participants may attempt to circumvent the proposed rule. Accordingly, the department encourages the Board to actively assess additional ways the proposed rule may be enhanced to increase competition for debit payment processing.
The Board is responsible for prescribing regulations pursuant to the Durbin Amendment, a statute designed to promote competition in the debit card market.
Click here to view the comment on the proposed rule.
Justice Department Files Sexual Harassment Lawsuit Against Massachusetts Sober Home OperatorRead the Press Release
The Justice Department’s Civil Rights Division and the U.S. Attorney’s Office for the District of Massachusetts filed a lawsuit today alleging that Peter McCarthy, who operates a group of residential sober homes through his company, Steps to Solutions Inc., subjected female residents to sexual harassment and retaliation in violation of the federal Fair Housing Act.
The lawsuit alleges that from at least 2012 through at least 2019, Peter McCarthy — the registered agent and sole officer of Steps to Solutions Inc. — sexually harassed female residents of his Steps to Solutions sober homes by offering to reduce or forgive rent, granting extra house privileges or waiving security deposits in exchange for engaging in sexual acts; requesting sexually explicit photographs and indicating that he would reduce or waive rent in exchange for the images; making unwanted sexual comments regarding female residents’ bodies; and retaliating and taking adverse housing actions against residents who reported his conduct. The lawsuit seeks a court order to prevent future discriminatory conduct, monetary damages to compensate victims of McCarthy’s conduct and civil penalties. The lawsuit alleges that Steps to Solutions Inc. is liable for McCarthy’s conduct.
“The Fair Housing Act’s promise of non-discrimination applies to everyone,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “At a time when our country is experiencing record numbers of deaths related to drug overdoses, it is particularly disturbing to see sexually harassing conduct targeted at individuals who are in recovery. The Department of Justice will not tolerate landlords who abuse their power and will continue to vigorously pursue allegations of sexual harassment.”
“It is disappointing that a landlord who is supposed to be helping vulnerable women beat drug addiction was allegedly sexually harassing them and offering to reduce their rent in exchange for sex,” said Acting U.S. Attorney Nathaniel R. Mendell for the District of Massachusetts. “Thankfully, the Fair Housing Act gives us effective tools to stop such despicable conduct and protect those who are being preyed upon. People who have experienced this kind of sexual harassment might be reluctant to report it, but we need to hear from them. Reporting sexual harassment is essential to stop and prevent sexual harassment.”
The Justice Department’s Sexual Harassment in Housing Initiative is led by the Civil Rights Division, in coordination with U.S. Attorney’s Offices across the country. The goal of the initiative is to address and raise awareness about sexual harassment by landlords, property managers, maintenance workers, loan officers or other people who have control over housing. Since launching the initiative in October 2017, the Justice Department has filed 22 lawsuits alleging sexual harassment in housing.
Individuals who have information about this case can contact the U.S. Attorney’s Office by calling (888) 221-6023 or by emailing [email protected].
The Justice Department’s Civil Rights Division enforces the Fair Housing Act, which prohibits discrimination in housing based on race, color, religion, national origin, sex, disability and familial status. More information about the Civil Rights Division and the laws it enforces is available at http://www.justice.gov/crt. Individuals wishing to report discrimination in housing may call the Justice Department’s Housing Discrimination Tip Line at 1-800-896-7743, email the Justice Department at [email protected] or submit a report online.
The Civil Rights Unit of the U.S. Attorney’s Office was established in 2015 with the mission of enhancing federal civil rights enforcement. For more information on the Office’s civil rights efforts, please visit www.justice.gov/usao-ma/civil-rights.
Jury convicts man for smuggling 105 in trailerRead the Press Release
LAREDO, Texas – A Laredo federal jury has convicted a 32-year-old out-of-state man for conspiring to transport and transporting undocumented aliens within the United States, announced Acting U.S. Attorney Jennifer B. Lowery.
The jury deliberated for less than four hours before convicting Christopher Faust, Sacramento, California, following a two-day trial.
On May 5, law enforcement stopped Faust for a traffic violation, at which time he claimed to be transporting green bananas. However, authorities quickly noticed the temperature on the refrigerated trailer was too high for produce. A K-9 then alerted to an odor emanating from inside the vehicle. Authorities opened the trailer and found 105 undocumented aliens.
The jury heard from a representative of the storage facility who Faust claimed had given him the load. He told the jury they do not ship green bananas and that Faust never picked up a load of produce from their facility.
The defense attempted to convince the jury Faust did not know that the people, all 105 of them, were in his trailer. The jury did not believe those claims and found him guilty as charged.
U.S. District Judge Marina Garcia Marmolejo presided over trial and will set sentencing at a later date. At that time, Faust faces up to 10 years of imprisonment and a possible $250,000 maximum fine.
Faust was permitted to remain on bond pending his that hearing.
Homeland Security Investigations conducted the investigation with assistance from the Texas Department of Public Safety and Border Patrol. Assistant U.S. Attorneys David Fawcett and Aaron Petters are prosecuting the case.
Jury Convicts Hospers, Iowa Man of Meth and Gun ChargesRead the Press Release
A man who conspired to distribute methamphetamine and illegally possessed a firearm was convicted by a jury on August 6, 2021, after a 4-day trial in federal court in Sioux City.
Robert Nicholas Hansen, 42, from Hospers, Iowa, was convicted of one count of conspiracy to distribute methamphetamine; three counts of distribution of methamphetamine; and one count of being a prohibited person in possession of a firearm. The verdict was returned after four hours of jury deliberations.
The jury found that, from January 2017 through January 2021, Hansen was involved in a conspiracy to distribute more than 500 grams of mixed methamphetamine and more than 50 grams actual/pure methamphetamine. Evidence at trial showed that Hansen was involved with several other co-conspirators in the acquisition and distribution of more than 100 pounds of methamphetamine. Evidence further showed that, on three separate occasions, Hansen distributed one-half pound of methamphetamine to individuals cooperating with law enforcement and during one of the transactions was found to possess three separate bundles of cash, totaling $14,000. The jury verdict included findings that two of Hansen’s methamphetamine distributions occurred within 1000 feet of Hospers Elementary School and South Side Park in Hospers, Iowa. The jury also found that Hansen illegally possessed, due to having a prior felony conviction and also being an unlawful user of methamphetamine, a firearm, a .223 caliber AR-15 style rifle. Hansen was previously convicted of possession of methamphetamine with intent to deliver in 2003 in the Iowa District Court for Sioux County.
Sentencing before United States District Court Chief Judge Leonard T. Strand will be set after a presentence report is prepared. Hansen remains in custody of the United States Marshal pending sentencing. For all of his convictions, Hansen faces a mandatory minimum sentence of 10 years’ imprisonment and a possible maximum sentence of life imprisonment, up to a $10,000,000 fine, and at least five years of supervised release following any imprisonment. The firearm and drug offense convictions could be run consecutive or concurrently to each other, or concurrent in part and consecutive in part.
The case is being prosecuted by Assistant United States Attorneys Shawn Wehde and Patrick Greenwood and was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Sioux County Sheriff’s Office, the Orange City Police Department, the Plymouth County Sheriff’s Office, the Iowa Division of Narcotics Enforcement and the 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 21-4014. Follow us on Twitter @USAO_NDIA.
Jefferson City Man Sentenced to 13 Years for Child PornographyRead the Press Release
JEFFERSON CITY, Mo. – A Jefferson City, Missouri, man was sentenced in federal court today for receiving child pornography over the internet.
Dana Paul Cline, 54, was sentenced by U.S. District Judge Roseann Ketchmark to 13 years in federal prison without parole. The court also ordered Cline to pay a total of $31,000 in restitution to several of his victims.
On July 7, 2020, Cline pleaded guilty to one count of receiving child pornography. Cline’s later motion to withdraw his guilty plea was denied by the court.
The investigation began on May 24, 2018, when a Missouri State Highway Patrol trooper downloaded child pornography from Cline’s computer during an investigation into a peer-to-peer file-sharing network. On June 27, 2018, law enforcement officers executed a search warrant at Cline’s residence. Officers examined Cline’s laptop and found videos and images of child pornography. According to court documents, Cline was seeking out child pornography of a very disturbing nature. The videos and images he distributed and received depicted extremely young children engaged in horrendous sexual acts with adults.
According to court documents, Cline has a history of domestic violence, substance abuse, and a previous investigation of possession of child pornography. In 2011, Cline’s former landlord reported he found two flash drives in Cline’s apartment that contained child pornography. A forensic examination of the flash drives revealed one contained two child pornography videos and the second contained 17 child pornography videos. The second flash drive also had multiple documents stored on it with Cline’s name and/or images linked to him.
This case was prosecuted by Assistant U.S. Attorney Ashley S. Turner. It was investigated by the Missouri State Highway Patrol and the Cole County, Mo., Sheriff’s Department.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Jamesville Man Sentenced to 15 Years in Federal Prison for Distribution, Transportation and Possession of Child PornographyRead the Press Release
SYRACUSE, NEW YORK – Roy Bovee, age 34, of Jamesville, New York, was sentenced today to serve 15 years in federal prison for distribution, transportation and possession of child pornography, announced Acting United States Attorney Antoinette T. Bacon, Janeen DiGuiseppi, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI), and New York State Police Superintendent Kevin Bruen.
As part of his guilty plea, Bovee admitted that in July 2020 he used the Kik Messenger application on his cellular telephone to distribute child pornography to other other Kik users. A search of the defendant’s cellular telephone revealed that he possessed 152 images and 113 video files depicting minors engaged in sexually explicit conduct. The images and videos included depictions of the rape and sodomy of prepubescent children. In addition, Bovee admitted to uploading over 100 images and videos depicting minors engaged in sexually explicit conduct to his on-line cloud storage account.
Bovee is a registered sex offender who while in the military was convicted in 2010 of Distribution of Child Pornography, sentenced to 20 months imprisonment, and given a bad conduct discharge.
United States District Judge David N. Hurd also imposed a 20-year term of supervised release, which will start after Bovee is released from prison, and ordered him to pay a $300 special assessment and $9,000 in restitution to the victims of his crimes.
At the time of his offense Bovee was on federal supervised release for a 2014 conviction for failing to register as a sex offender, for which he served a 54-month sentence. Today he also received a concurrent term of 9 months imprisonment for violating the conditions of that release.
Bovee’s case was investigated by the FBI Syracuse Mid-State Child Exploitation Task Force, comprised of FBI Special Agents and Investigators of the New York State Police, Bureau of Criminal Investigation (BCI), and Computer Crimes Unit (CCU) with assistance from the United States Probation Office. The case was prosecuted by Assistant U.S. Attorney Geoffrey J. L. Brown as a part of Project Safe Childhood.
Launched in May 2006 by the Department of Justice, Project Safe Childhood is led by United States Attorney’s offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS). Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit https://www.justice.gov/psc.
Huntington Man Sentenced to Federal Prison for Methamphetamine OffenseRead the Press Release
CHARLESTON, W.Va. – A Huntington man was sentenced today to 46 months in prison for possession with intent to distribute methamphetamine. Deshawn Derese Nelson, 52, previously admitted that he intended to distribute approximately 18 grams of methamphetamine seized from him during an arrest in Parkersburg.
According to court documents, Nelson was arrested by the Parkersburg Police Department during a traffic stop on Lynne Street on December 26, 2018 for an outstanding capias from Cabell County. While processing him on the arrest, officers found methamphetamine hidden in Nelson’s pantleg. Nelson had previously been convicted of robbery, theft, carrying a deadly weapon and possession with intent to distribute crack cocaine, and was facing charges of first degree arson and possession with intent to deliver a controlled substance when he was arrested.
Acting United States Attorney Lisa G. Johnston made the announcement and commended the excellent investigative work of the Parkersburg Police Department and the Parkersburg Narcotics Task Force.
Senior United States District Judge John. T. Copenhaver, Jr. imposed the sentence. Assistant United States Attorney Joshua C. Hanks handled the prosecution.
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. 2:20-cr-00062.
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Health Center Pays $350K to Settle Improper Billing Allegations Related to Medicaid Dental ServicesRead the Press Release
Acting United States Attorney Leonard C Boyle and Connecticut Attorney General William Tong today announced that CORNELL SCOTT HILL HEALTH CORPORATION (“CSH”) has entered into a civil settlement agreement with the federal and state governments and has paid $350,000 to resolve allegations that CSH improperly billed the Connecticut Medicaid program for certain dental services.
CSH is a Federally Qualified Health Center (“FQHC”) that provides a variety of health care services, including dental services, to Connecticut Medicaid beneficiaries and other individuals. Pursuant to federal requirements, the State of Connecticut compensates FQHCs on an “encounter-based” reimbursement structure. For the provision of dental services, claims are limited to one all-inclusive encounter per day to include all dental services received by a patient on the same day.
The allegations against CSH arise out of improper billing for certain dental services, specifically prophylactic cleanings and dental exams. The government alleges that CSH implemented a policy that required Medicaid patients to receive prophylactic cleanings and dental exams on separate days, resulting in CSH getting paid two encounter rates instead of just one rate.
To resolve their liability, CSH paid $350,000 to the federal and state governments for conduct occurring between January 1, 2017 through December 31, 2019. In addition, CSH has agreed to change its policy and offer all Medicaid beneficiaries the option of scheduling a prophylactic cleaning and dental examination on the same day.
This matter was investigated by the Office of Inspector General for the Department of Health and Human Services. The case was prosecuted by Assistant U.S. Attorney Richard M. Molot and by Assistant Attorneys General Michael Cole and Joshua Jackson of the Connecticut Office of the Attorney General.
People who suspect health care fraud are encouraged to report it by calling 1-800-HHS-TIPS or the Health Care Fraud Task Force at (203) 777-6311.
Harris County Man Sentenced for Laundering Drug Trafficking ProceedsRead the Press Release
BEAUMONT, Texas – A Houston man has been sentenced to federal prison for drug trafficking violations in the Eastern District of Texas, announced Acting U.S. Attorney Nicholas J. Ganjei today.
Alexis Villatoro, 26, pleaded guilty on Jan. 12, 2021, to conspiracy to commit money laundering and was sentenced to 40 months in federal prison today by U.S. District Judge Thad Heartfield.
“Drugs and money laundering go hand-in-hand,” said Acting U.S. Attorney Nicholas J. Ganjei. “Seizing the proceeds of drug trafficking is an important part of our efforts to fight illegal drug activity and our district will continue to pursue these violators with every resource available.”
According to information presented in court, on Dec. 10, 2018, local law enforcement authorities conducted a traffic stop of Villatoro on Interstate-10 in Beaumont. During the traffic stop, a police canine positively alerted to the presence of contraband. A subsequent probable cause search was conducted on the vehicle, during which $12,360 in cash was located in the rear hatch area. Further investigation revealed the money was the proceeds of an illegal drug transaction. Villatoro was indicted by a federal grand jury on Oct. 7, 2020.
This effort is part of Operation Guitar Hero, 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.
This case was investigated by the U.S. Drug Enforcement Administration, the Beaumont Police Department and prosecuted by Assistant U.S. Attorney Michael Anderson.
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Hancock County woman indicted on fraud chargesRead the Press Release
WHEELING, WEST VIRGINIA – Jacque Phillips, of Weirton, West Virginia, appeared in federal court this week after being indicted on wire fraud, theft, and money laundering charges, Acting United States Attorney Randolph J. Bernard announced.
Phillips, also known as “Jacque Phillips-Brown,” 32, was indicted on three counts of “Wire Fraud,” one count of “Theft from a Health Care Benefit Program,” and three counts of “Money Laundering.” Phillips was employed as a billing manager at a medical billing company in Steubenville, Ohio. According to the indictment, beginning in January 2018 through March 2019, Phillips defrauded her employer, her employer’s patients, and insurance companies out of more than $100,000. Phillips allegedly used the financial services company Square, Inc. by linking her personal bank accounts to the Square, Inc. accounts she registered in her employer’s name. It is alleged that Phillips then used those Square accounts to transfer funds paid to her employer, some from insurance and health care benefits programs, into her personal accounts.
Phillips faces up to 20 years of incarceration and a fine of up to $250,000 for each count of wire fraud, faces up to 10 years of incarceration and a fine of up to $250,0000 for the theft charge, and faces up to 20 years of incarceration and a fine of up to $500,000 for each count of money laundering. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Danae DeMasi-Lemon is prosecuting the case on behalf of the government. The FBI investigated.
An indictment is merely an accusation. A defendant is presumed innocent unless and until proven guilty.
U.S. Magistrate Judge James P. Mazzone presided.
Grand Jury Returns IndictmentsRead the Press Release
MADISON, WIS. – A federal grand jury in the Western District of Wisconsin, sitting in Madison, returned the following indictments today. You are advised that a charge is merely an accusation and that a defendant is presumed innocent until and unless proven guilty.
Two Rothschild Men Charged in Money Laundering Conspiracy
Mario Amezcua-Cardenas, 27, and Moises Amezcua-Cardenas, 20, both of Rothschild, Wisconsin, are charged with conspiring to commit money laundering involving the proceeds of a fraud scheme targeting businesses in Wisconsin and elsewhere. The two defendants are brothers.
The indictment alleges that from November to December 2020, the two defendants conspired to launder the proceeds of a scheme involving unknown perpetrators who operated from Mexico and convinced employees of businesses to collect and deliver the businesses’ cash-on-hand to the defendants by posing as company attorneys, store managers, or upper management from a corporate office.
As part of the conspiracy, the indictment alleges that the two defendants used financial transactions to transfer the fraud proceeds to others. The indictment alleges that in December 2020, the defendants collected $242,980 from a retail store located in the Western District of Wisconsin and transferred the funds to an individual in Milwaukee, Wisconsin.
If convicted, Mario Amezcua-Cardenas and Moises Amezcua-Cardenas face a maximum penalty of 20 years in federal prison. The charge against them is the result of an investigation by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; Federal Bureau of Investigation; Marathon and Portage County Sheriffs’ Offices; the Merrill, Everest Metropolitan, Stevens Point, Wausau, Rib Mountain, Plover, Rothschild, and West Allis Police Departments; with assistance by the Marathon County District Attorney’s Office. Assistant U.S. Attorney Meredith Duchemin is handling the prosecution.
Merrill Man Charged with Producing and Transporting Child Pornography
Jason D. Ridolfi, 40, Merrill, Wisconsin, is charged with two counts of using a minor to produce child pornography and one count of transporting child pornography. The indictment alleges that on August 30 and 31, 2017, Ridolfi used a minor to engage in sexually explicit conduct for the purpose of producing a visual depiction of such conduct. The indictment further alleges that on October 20, 2020, Ridolfi transported a visual image of a minor engaged in sexually explicit conduct into a Google account.
If convicted, Ridolfi faces a mandatory minimum of 15 years and a maximum of 30 years in federal prison on each of the production charges, and a mandatory minimum of 5 years and a maximum of 20 years on the transportation charge. The charges against him are the result of an investigation by the Wisconsin Department of Justice Division of Criminal Investigation, Lincoln County Sheriff’s Office, and Kenosha Police Department. Assistant U.S. Attorney Elizabeth Altman is handling the prosecution.
Wisconsin Dells Man Charged with Drug & Gun Crimes
Levonte C. Scales, 29, Wisconsin Dells, Wisconsin, is charged with possessing 50 grams or more of methamphetamine with the intent to distribute, with possessing a firearm in furtherance of that drug trafficking crime, and with being a felon in possession of a firearm. The indictment alleges that he possessed the methamphetamine and a handgun on June 22, 2021.
If convicted, Scales faces a mandatory minimum penalty of 5 years and a maximum of 40 years on the methamphetamine charge, a mandatory minimum of 5 years and a maximum of life on the charge of possessing a firearm in furtherance of a drug trafficking crime, and a maximum of 10 years on the felon in possession of a firearm charge. Federal law requires that any sentence imposed on the charge of possessing a firearm in furtherance of a drug trafficking crime be served consecutive to any other sentence imposed.
The charges against Scales are the result of an investigation by the Lake Delton Police Department, Sauk County Sheriff’s Office, and Drug Enforcement Administration. Assistant U.S. Attorney Zachary Corey is handling the prosecution.
Baraboo Man Charged with Illegally Possessing Firearm
Anthony James Wilson, 28, Baraboo, Wisconsin, is charged with being a felon in possession of a firearm. The indictment alleges that Wilson possessed a loaded .357 caliber revolver on June 3, 2021.
If convicted, Wilson faces a maximum penalty of 10 years in federal prison. The charge against him is the result of an investigation by the Sauk County Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Corey Stephan is handling the prosecution.
The indictments charging Scales and Wilson have been brought as 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 works 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.
Dunn County Man Charged with Distributing Methamphetamine
Richard Skramstad, 58, Knapp, Wisconsin, is charged with three counts of distributing methamphetamine. The indictment alleges that he distributed methamphetamine on April 12, April 13, and May 13, 2021.
If convicted, Skramstad faces a maximum penalty of 20 years in federal prison on each charge. The charges against him are the result of an investigation by the West Central Drug Task Force, Dunn County Sheriff’s Office, and Drug Enforcement Administration. Assistant U.S. Attorney Taylor Kraus is handling the prosecution.
Former Montgomery High School Assistant Principal Sentenced for Scamming School System Out of More Than $300,000.00Read the Press Release
Montgomery, Alabama – On Tuesday, August 10, 2021, Walter James, III, a 50-year-old from Montgomery, Alabama, and former Montgomery Public Schools (MPS) employee, was sentenced to 60 months in prison after pleading guilty to wire fraud, announced Acting United States Attorney Sandra J. Stewart, FBI Special Agent in Charge James Jewell, and Alabama Attorney General Steve Marshall. Following James’ prison sentence, he will serve three years of supervised release. There is no parole in the federal system. James was also ordered to pay restitution in the amount of $314,867.55 to MPS for the monetary losses his scheme cost their system.
According to court documents and testimony provided in open court, James held himself out to be the owner of a consulting company, "ED-ONE Professional Development Services,” while he was employed by the MPS system. He then worked in partnership with others at his high school and the MPS central office to submit fraudulent invoices for consulting or professional development services. The invoices that were submitted listed vague descriptions of the types of services that had been supposedly provided. For example, the invoices would include descriptions such as “books & materials,” “consulting,” or “three-day workshop.” In reality, James did not provide any professional development services or products of any kind to MPS, nor did any of the purported consulting companies on the corresponding invoices that James submitted for payment. During the sentencing hearing, the court determined that the scheme, which occurred from August 2016 to April 2019, created a loss of $314,867.55 to MPS. James was ordered to pay restitution in that amount to MPS.
“It is such an outrageous violation of the public trust when people responsible for the education of our children cheat taxpayers and line their own pockets instead of benefitting students who, in this great country, are entitled to a public education,” stated Acting U.S. Attorney Stewart. “Now, more than ever, it is critical that funds allocated to public schools make it to the classroom and are used to educate students. In this case, James ignored his responsibility to spend government funds on the children and he deprived both students and teachers of much needed resources. I hope this prosecution sends a strong message to all those educators who put themselves above the needs of our children and their teachers that they will be held accountable.”
“Employees of our nation’s educational system must hold themselves to a higher standard,” stated FBI Special Agent in Charge Jewell. “The strong partnerships we enjoy with our state and local partners ensure this type of criminal activity will be detected and dealt with accordingly.”
“Public employees are entrusted to be stewards of taxpayer funds,” said Attorney General Marshall. “When that trust is broken, not only are public resources diminished but the community’s faith in our government is undermined. Mr. James repeatedly stole considerable funds from the Montgomery Public School System and his acts have eroded citizens’ confidence in their local schools. His sentence should send an unmistakable message that those who violate the public trust will be held accountable.”
The Federal Bureau of Investigation (FBI), the Alabama Attorney General’s Office, the Alabama Ethics Commission, and the Alabama Department of Examiners of Public Accounts investigated this case. Special Assistant U.S. Attorney Thomas Govan and Assistant United States Attorney Jonathan Ross prosecuted the case.
Former Lunenburg Woman Sentenced for Stealing Social Security BenefitsRead the Press Release
BOSTON – A former Lunenburg woman was sentenced yesterday in federal court in Worcester to stealing Social Security benefits.
Sue E. Delaney, 68, was sentenced by U.S. District Court Judge Timothy S. Hillman to six months of home confinement and two years of probation. Delaney was also ordered to pay $221,656 in restitution to the Social Security Administration (SSA). On April 12, 2021, Delaney pleaded guilty to one count of conspiracy and one count of theft of public funds.
“Delaney purposefully failed to report the death of her own family member just to continue receiving and pocketing her dead relative’s Social Security benefits,” said Acting United States Attorney Nathaniel R. Mendell. “Her crime diverted benefits meant for people who are actually entitled to them. Our office will use federal charges where appropriate to punish this type of fraud and protect the integrity of the Social Security system.”
“Concealing death information from the Social Security Administration to steal benefits issued to the deceased is a Federal crime that we will continue to pursue,” said Gail S. Ennis, Inspector General for the Social Security Administration. “For over 16 years, this individual withheld essential information to maintain illegal access to more than $221,000. I thank the U.S. Attorney’s Office and Special Assistant U.S. Attorney Karen Burzycki for prosecuting this case.”
In 1999, Delaney’s mother-in-law, who was receiving monthly benefits from Social Security, passed away. Delaney failed to inform the Social Security Administration of the death, and SSA continued to deposit monthly benefits into a bank account held by Delaney’s mother-in-law. From November 1999 through March 2017, Delaney stole approximately $221,656 in Social Security benefits from her late mother-in-law’s account.
Acting U.S. Attorney Mendell and SSA IG Ennis made the announcement today. Special Assistant U.S. Attorney Karen Burzycki of Mendell’s Major Crimes Unit prosecuted the case.
Former Contractor Charged with Violating Federal Lead Paint LawsRead the Press Release
INDIANAPOLIS – A federal grand jury in Indianapolis returned an indictment yesterday charging a Richmond, Indiana man with violating the Toxic Substance Control Act, specifically the provisions of the Act concerning lead paint, and obstruction of justice.
According to court documents, Jeffrey Delucio, 52, of Richmond, was a co-operator of Aluminum Brothers Home Improvements LLC in Richmond. Delucio failed to follow lead-safe work practices while renovating residences in the Richmond area. As a result, lead-based paint chips were scattered throughout the properties and were not cleaned up timely or properly as work was being conducted. One of the residences was inhabited by a child with elevated blood lead levels, which had prompted the renovation work at that property to begin with.
The indictment also alleges that Delucio failed to train his workers on lead-safe work practices and then falsified documents to conceal his conduct. Delucio’s company received a federal grand jury subpoena for records, including records of employee training on lead-safe work practices. The indictment alleges that Delucio had not trained his employees but, in response to the subpoena, fabricated records purporting to state that he did.
“The health and safety of all Hoosiers is a responsibility that everyone plays a role in,” said Acting U.S. Attorney John Childress. “Mr. Delucio failed the community, his employees, and the environment. This is another example of bringing those who violate that responsibility to justice to help protect our citizens and preserve the environment for current and future generations.”
“The defendant created risks by not only failing to follow lead-safe work practices, but also falsely representing to the government that employees had received training,” said Special Agent in Charge Jennifer Lynn of EPA’s criminal investigation program. “Today’s indictment demonstrates that individuals that intentionally violate environmental laws will be held responsible for their crimes.”
“This indictment represents our continuing resolve to investigate instances of fraud, particularly when the programs involved protect children and families from lead and other hazardous materials,” said HUD OIG Special Agent in Charge Michael Powell. “It is our continuing core mission to work with our law enforcement partners and the United States Attorney’s Office to protect the integrity of our programs and to take strong action against those who seek to circumvent the laws meant to protect the most vulnerable in our communities.”
“I want to thank the U.S. EPA, HUD, and DOJ for their collaboration in protecting the health and well-being of Hoosiers,” said IDEM Commissioner Bruno Pigott. “Strong partnerships with our federal partners are vital to keeping our environment safe for children, vulnerable communities, and everyone throughout Indiana.”
Delucio has been charged with two counts of violating the Toxic Substances Control Act, as well as one count of falsifying documents during a federal investigation. If convicted, he faces up to 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The case was jointly investigated by the United States Environmental Protection Agency, the United States Department of Housing and Urban Development, and the Indiana Department of Environmental Management.
Assistant United States Attorney Kate Olivier 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.
Former Boston Police Auto Repair Technician Pleads Guilty to Wire Fraud ChargesRead the Press Release
BOSTON – A former auto repair technician with the Boston Police Department’s (BPD) Fleet Management Division pleaded guilty yesterday in connection with a scheme to embezzle hundreds of thousands of dollars from the BPD.
Bahram Gharony, 36, of Boston, pleaded guilty to two counts of wire fraud. U.S. Senior District Court Judge Douglas P. Woodlock scheduled sentencing for Dec. 14, 2021. Gharony was charged on July 30, 2021.
“Mr. Gharony embezzled hundreds of thousands of dollars in auto parts and supplies from the Boston Police Department at the expense of the public’s trust in his honest and hardworking law enforcement colleagues,” said Acting United States Attorney Nathaniel R. Mendell. “Our office remains ready to prosecute people who abuse their positions and violate the public trust for personal gain.”
"While working for the Boston Police Department's fleet management division, Bahram Gharony has admitted he was also working for himself—orchestrating a fraudulent scheme that cost the city’s taxpayers more than a quarter of a million dollars. Mr. Gharony clearly knew what he was doing was wrong because of the steps he took to conceal his criminal conduct, but his divided loyalty got the best of him,” said Joseph R. Bonavolonta, Special Agent in Charge of the FBI Boston Division. “We’d like to thank the Boston Police Department’s Anti-Corruption Unit for bringing this to our attention and putting a stop to this practice.”
Gharony engaged in a scheme that allegedly defrauded BPD’s Fleet Management Division of over $260,000 in automotive parts, tools and supplies between June 2017 and September 2020. 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 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.
Foley Man Sentenced in Federal Court on Methamphetamine and Firearm ChargesRead the Press Release
MOBILE, AL – A Foley, Alabama, man was sentenced on August 10, 2021, to 15 years in prison for his participation in a conspiracy to possess with intent to distribute methamphetamine ice and possession of a firearm in connection with a drug trafficking felony.
According to court documents, John Heath Carter, 38, distributed large amounts of methamphetamine ice he obtained from various suppliers in Baldwin County, Alabama. Carter was stopped by the Foley Police Department for a traffic violation and officers found methamphetamine ice, a .38 caliber pistol, and a CS grenade. The methamphetamine ice was packaged for distribution. Carter was advised of his Miranda rights and he admitted his participation in the scheme to possess with intent to distribute methamphetamine.Chief United States District Court Judge Kristi K. Dubose imposed the 15-year sentence, consisting of 10 years on the conspiracy charge and 5 years on the firearm charge. By operation of federal law, the sentence for the firearm charge must run consecutively to any other sentence of imprisonment. Chief Judge Dubose further ordered that Carter would also serve eight years on supervised release following his imprisonment. As conditions of his supervision, Carter will undergo testing and treatment for drug abuse, and he will be subject to a search of his person and premises upon reasonable suspicion. No fine was imposed but Chief Judge Dubose ordered that Carter pay $200 in special assessments.
The case was investigated by the Foley Police Department, the Baldwin County Sheriff’s Office, the Baldwin County Drug Task Force, and the FBI’s Safe Streets Task Force. Assistant U.S. Attorney Gloria Bedwell prosecuted the case on behalf of the United States.Florida Man Sentenced to 18 Months for Bank FraudRead the Press Release
CONCORD - Benjamin Stockwell, 31, formerly of Pittsfield, now residing in Florida, was sentenced to 18 months in federal prison for bank fraud on Tuesday, Acting United States Attorney John J. Farley announced today.
According to court documents and statements made in court, Stockwell stole checks from various mailboxes throughout New Hampshire, altered them, and cashed them at various banks in his own name.
Stockwell previously pleaded guilty on February 9, 2021.
“Fraud crimes can cause significant harm to victims,” said Acting U.S. Attorney Farley. “By stealing checks from the mail and defrauding banks with altered checks, this defendant committed a significant federal crime. We will continue to work closely with our law enforcement partners to identify and prosecute those who commit fraud crimes in the Granite State.”
“Forgery is a serious crime that affects the victim both financially and mentally. We are pleased that Mr. Stockwell is being held accountable for his crimes and we hope this sends a message to others that this behavior will not be tolerated,” Manchester Police Chief Allen Aldenberg.
This matter was investigated by the United States Postal Inspection Service, with assistance from the Manchester Police Department’s Fraud and Financial Crimes Unit and the Bow Police Department. The case was prosecuted by Assistant U.S. Attorneys Georgiana MacDonald and Matthew Hunter.
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Fintech CEO Sentenced to 6 Years in Prison for Multiple Fraud Schemes, Including $7 Million Covid-19 Pandemic Loan Fraud and Securities FraudRead the Press Release
Audrey Strauss, United States Attorney for the Southern District of New York, announced today that SHENG-WEN CHENG, a/k/a “Justin Cheng,” a/k/a “Justin Jung,” was sentenced to 72 months in prison for multiple fraud schemes he perpetrated. In particular, CHENG engaged in a scheme to fraudulently obtain over $7 million in Government-guaranteed loans designed to provide relief to small businesses during the COVID-19 pandemic. CHENG also solicited and obtained investments in Alchemy Coin Technology Limited and related companies controlled by CHENG through materially false and misleading statements and omissions. Finally, CHENG fraudulently obtained due diligence fees from dozens of start-up companies as part of an advance fee scheme. CHENG was sentenced earlier today before U.S. District Judge Alison J. Nathan.
U.S. Attorney Audrey Strauss said: “Sheng-Wen Cheng fraudulently applied for over $7 million in government-guaranteed loans under programs designed to provide relief for financially struggling small businesses hurt by the COVID pandemic. Further, Cheng committed securities fraud by lying to investors in his blockchain-based peer-to-peer lending platform, and wire fraud by engaging in an advance fee scheme. Now Cheng has been sentenced to prison for his multitude of crimes.”
According to the Complaint, Information, and other documents filed in Manhattan federal court:
The Coronavirus Aid, Relief, and Economic Security (“CARES”) Act is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of hundreds of billions of dollars in forgivable loans to small businesses for job retention and certain other expenses through the SBA’s Paycheck Protection Program (“PPP”). Pursuant to the CARES Act, the amount of PPP funds a business is eligible to receive is determined by the number of employees employed by the business and their average payroll costs. The CARES Act also expanded the separate Economic Injury Disaster Loan (“EIDL”) Program, which provided small businesses with low-interest loans that can provide vital economic support to help overcome the temporary loss of revenue they are experiencing due to COVID-19.
CHENG, a Taiwanese national who entered the United States on a student visa, was a self-proclaimed “serial entrepreneur” who attended Pennsylvania State University (“Penn State”). From at least in or about April 2020 through at least on or about August 13, 2020, CHENG used the identity of other individuals to submit online applications to the SBA and at least five financial institutions for a total of over $7 million in government-guaranteed loans through the SBA’s PPP and EIDL Program for several companies controlled by CHENG, namely Alchemy Finance, Inc., Alchemy Guarantor LLC d/b/a “Celer Offer,” Celeri Network, Inc., Celeri Treasury LLC, Wynston York LLC, and Neo Bellum Industries Inc. (collectively, the “Cheng Companies”). In connection with these loan applications, CHENG represented, among other things, that other individuals were the sole owners of the Cheng Companies and that the Cheng Companies together had over 200 employees and paid a total of approximately $1.5 million in wages to those employees on a monthly basis. In fact, however, the Cheng Companies appear to have had a total of no more than 14 employees.
In order to support the false representations in the loan applications about the number of employees at and the wages paid by the Cheng Companies, CHENG submitted fraudulent and doctored tax records that were never actually filed with the IRS and payroll records containing the forged electronic signature of a payroll company employee. CHENG also submitted a payroll summary for one of his companies that listed the names of more than 90 purported employees, several of which consisted of current and former athletes, artists, actors, and public figures. For example, the list of purported employee names included a co-anchor on Good Morning America, a former National Football League player, and a prominent former Penn State football coach who is now deceased.
Based on the fraudulent PPP loan applications submitted by CHENG, a total of more than $3.7 million in PPP loans were approved for the Cheng Companies and approximately $2.8 million in PPP loan proceeds were deposited into bank accounts solely controlled by CHENG. Instead of using the PPP loan proceeds for payroll costs, mortgage interest, rent, and/or utilities for the purported Cheng Companies as required by the PPP, CHENG transferred over $1 million abroad, withdrew approximately $360,000 in cash and/or cashier’s checks, and spent at least approximately $279,000 in PPP loan proceeds on personal expenses. These personal expenses included the purchase of an 18-carat gold Rolex watch for approximately $40,000, rent and move-in fees for a $17,000 per month luxury condominium used by CHENG, approximately $50,000 of furnishings for the condominium, a portion of the purchase of a 2020 S560X4 Mercedes, and purchases totaling approximately $37,000 at Louis Vuitton, Chanel, Burberry, Gucci, Christian Louboutin, and Yves Saint Laurent.
In addition to the COVID-19 pandemic loan fraud described above, from at least in or about 2017 through at least in or about 2019, CHENG committed securities fraud by soliciting and obtaining approximately $400,000 in investments in Alchemy Coin Technology Limited and related companies (“Alchemy Coin”) controlled by CHENG. These investments were obtained through materially false and misleading statements and omissions regarding Alchemy Coin’s access to capital, use of investor proceeds, the product readiness of its purported blockchain-based peer-to-peer lending platform, and the registration of its tokens as part of an initial coin offering.
Finally, from at least in or about 2018 through at least in or about 2019, CHENG committed wire fraud by fraudulently obtaining a total of approximately $380,000 in so-called “due diligence fees” from dozens of start-up companies as part of an advance fee scheme. CHENG falsely told these companies seeking investors that, in exchange for a due diligence fee that was fully refundable, CHENG would perform due diligence on the companies and assess them for investments or otherwise assist them in securing funding. However, CHENG had no interest in or financial ability to invest in any of the victim companies, did not return the purportedly refundable fees despite repeated requests from victims, and used the fees for personal expenses as opposed to performing any due diligence. When CHENG was confronted by victims to return the fees after they realized that no investments were forthcoming, CHENG falsely told the victims that he did not have the fees and that a third-party due diligence company he had employed had stolen the fees.
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CHENG, 25 of New York, New York, pled guilty on April 20, 2021, to one count of major fraud against the United States, one count of bank fraud, one count of securities fraud, and one count of wire fraud.
In addition to the prison term, CHENG was sentenced to three years of supervised release and ordered to forfeit luxury items seized in connection with his arrest, including a Mercedes, a Rolex watch, and a diamond engagement ring. The amount of restitution to victims of the offense will be set at a later date. CHENG also consented to removal from the United States upon his release from prison.
Ms. Strauss praised the investigative work of the Federal Bureau of Investigation, the Office of the Inspector General of the U.S. Small Business Administration, and the Internal Revenue Service Criminal Investigation. Ms. Strauss also thanked the United States Securities and Exchange Commission, U.S. Customs and Border Protection, and the New York State Department of Labor for their assistance.
The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorney Sagar K. Ravi is in charge of the prosecution.
Federal Criminal Complaint Charges Santa Barbara Man with Murdering His Two Young Children in Baja CaliforniaRead the Press Release
LOS ANGELES – A Santa Barbara man was charged today with taking his two young children to Rosarito, Mexico and killing them.
Matthew Taylor Coleman, 40, allegedly killed the 2-year-old boy and 10-month-old girl on Monday. A federal criminal complaint filed today charges Coleman with foreign murder of United States nationals.
Coleman is expected to make his initial court appearance this afternoon in United States District Court in downtown Los Angeles.
An affidavit in support of the criminal complaint outlines the investigation that started on Saturday when Coleman’s wife contacted the Santa Barbara Police to report that her husband had left the couple’s residence in a Sprinter van and she did not know where they had gone.
The next day, Coleman’s wife filed a missing persons report. Using a computer application, Coleman’s wife was able to determine that Coleman’s phone had been in Rosarito on Sunday afternoon, the affidavit states.
The same phone-locating service was used on Monday and showed that Coleman’s phone was near the San Ysidro Port of Entry at the U.S.-Mexico border, according to the affidavit. The FBI dispatched colleagues in San Diego to contact Coleman, who entered the United States in the Sprinter van without the children. When the children were not found, FBI agents contacted law enforcement officials in Rosarito and learned that Mexican authorities that morning had recovered the bodies of two children matching the description of Coleman’s children.
After further investigation, FBI agents took Coleman into custody.
A criminal complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
The FBI, United States Customs and Border Protection, the Santa Barbara Police Department, and the Secretaría de Seguridad Pública Municipal de Rosarito are investigating this matter. The Santa Barbara County District Attorney’s Office provided substantial assistance throughout the investigation.
Assistant United States Attorneys Kevin Butler of the Violent and Organized Crime Section and Joanna Curtis, Chief of the Violent and Organized Crime Section, are prosecuting this case.
Federal Charges Filed Following Record-Breaking Drug SeizureRead the Press Release
Special Assistant U. S. Attorney Steven Lee (619) 546-8893
NEWS RELEASE SUMMARY – August 6, 2021
SAN DIEGO – Acting U.S. Attorney Randy Grossman announced federal drug charges today (August 6) against Defendant Carlos Gerardo Symonds Saavedra following the seizure of more than 2,500 kilograms of methamphetamine and 50 kilograms of fentanyl found in a commercial trailer at the Otay Mesa, California Cargo Port of Entry.
The Complaint alleges that on August 5, 2021, at approximately 5:24 p.m., Symonds Saavedra, a Mexican citizen, attempted to enter the U.S. as the driver and sole occupant of a 2008 International commercial truck, which was hauling a Strick trailer. Defendant’s manifest reflected the load consisted of plastic parts. According to the complaint, the secondary inspection reflected anomalies, determined upon testing to be illicit drugs, comingled with the commercial shipment of plastic parts. Defendant was allowed to exit the port of entry facility under visual surveillance. The complaint states that when defendant arrived at a private commercial parking lot, he parked the trailer, placed the keys under the hood and walked away. He was apprehended approximately 100 yards from the trailer and placed under arrest.
Further inspection of the trailer resulted in the discovery of: 400 packages of a substance that field-tested positive for methamphetamine, with an approximate weight of 2,507.58 kgs., as well as 52 kgs. of fentanyl. This is believed to be one of the largest methamphetamine seizures in the nation’s history.
“This is a significant accomplishment by our law enforcement partners,” said Acting U.S. Attorney Randy Grossman. “Due to stellar work by law enforcement agents, the government stopped more 5,500 pounds of deadly drugs from entering our country, furthering our fight against addiction and overdose deaths.”
“Over the last several years, we’ve seen many drug overdoses and drug-related deaths throughout this country,” said HSI San Diego Special Agent in Charge Cardell T. Morant. “HSI and its law enforcement partners undoubtedly saved lives by preventing this massive drug shipment from entering our communities. While this drug seizure is significant, we know that these transnational criminal organizations will continue to illegally smuggle their illicit drugs across our border. HSI and its law enforcement partners will remain vigilant in our mission to prevent these drugs from crossing the border and entering our communities.”
“By working in unison with our law enforcement partners, DEA has prevented a significant quantity of deadly drugs from reaching Americans,” said DEA Special Agent in Charge John W. Callery. “This seizure is a blow to the cartels; but a victory in the fight against methamphetamine and fentanyl overdose deaths plaguing our county. DEA remains committed to stopping the cartels who will undoubtedly continue trying to bring their deadly drugs into our country.”
DEFENDANT Case Number 21MJ3189
Carlos Gerardo Symonds Saavedra Residence: Mexico
SUMMARY OF CHARGES
Title 18, U.S.C., Sections 952 and 960
Importation of a controlled substance
Maximum penalty: Life in prison; and a mandatory minimum of 10 years; and a $10 million fine
AGENCIES
Homeland Security Investigations
Drug Enforcement Administration
U.S. Customs and Border Protection
*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Ex-teacher admits guilt in child sexual exploitation investigationRead the Press Release
AUGUSTA, GA: A former Aiken County, S.C., teacher has admitted to a child sexual exploitation charge related to illegal activities with a Columbia County, Ga., minor.
Jonathan Eugene Grantham, 45, of Graniteville, S.C., awaits sentencing after pleading guilty in U.S. District Court to Coercion and Enticement of a Minor to Engage in Sexual Activity, said David H. Estes, Acting U.S. Attorney for the Southern District of Georgia. The plea subjects Grantham to a minimum sentence of 10 years in prison, up to life, along with substantial financial penalties and restitution to the victim. Following completion of any prison term, he must serve a minimum of five years of supervised release and register as a sex offender.
There is no parole in the federal system.
“It’s sickening to contemplate the fact that while Jonathan Grantham was serving as a high-school teacher, he was surreptitiously participating in the depraved sex trafficking of a child,” said Acting U.S. Attorney Estes. “This plea will hold him accountable for his crimes, while our diligent law enforcement partners continue their outstanding work to protect our most vulnerable citizens from such predation.”
At the time of his arrest in February, Grantham was employed as a teacher at Ridge Spring-Monetta High School in Ridge Spring, S.C. He later was terminated.
As described in court documents and testimony, Grantham came to the attention of the FBI while agents were conducting a sex trafficking investigation involving other defendants.
That investigation discovered that Grantham, in July 2019, traveled from South Carolina to Columbia County to engage in sexual activity with a victim who was under age 18. In his plea agreement, Grantham acknowledges contacting the victim through the Internet to coerce the victim “to engage in sexual activity for which the defendant could be charged with a criminal offense, that is, child molestation.”
Grantham remains in federal custody while awaiting sentencing.
“Grantham targeted and manipulated a child for his own perverse enjoyment,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “The FBI has zero tolerance for child predators, and we will continue to use any resources necessary to apprehend anyone who carries out these appalling crimes.”
The case is being investigated by the FBI, and prosecuted for the United States by Assistant U.S. Attorneys Tania G. Groover and Project Safe Childhood Coordinator Tara M. Lyons.
Elberta Man Sentenced in Federal Court on Methamphetamine and Firearm ChargesRead the Press Release
MOBILE, AL – An Elberta, Alabama, man was sentenced today, to 72 months in prison for his participation in a conspiracy to possess with intent to distribute methamphetamine ice and for his possession of a firearm in connection with a drug trafficking felony.
According to court documents, Donald Ray Thomas, 42, distributed methamphetamine ice he obtained from various suppliers in Baldwin County, Alabama, and in Pensacola, Florida. Thomas was distributing the drugs from various places in the county, including a business where he worked in Foley.
Chief United States District Court Judge Kristi K. Dubose imposed the 72-month sentence, which consisted of 12 months on the drug charge and 60 months on the gun charge, to run consecutively. Chief Judge Dubose further ordered that Thomas would also serve five years on supervised release following his imprisonment. As conditions of his supervision, Thomas will undergo testing and treatment for drug abuse and a mental health evaluation, and he will be subject to a search of his person and premises upon reasonable suspicion. No fine was imposed but Chief Judge Dubose ordered that Thomas pay $200 in special assessments.
The case was investigated by the Baldwin County Sheriff’s Office, the Baldwin County Drug Task Force, and the FBI’s Safe Streets Task Force. Assistant U.S. Attorney Gloria Bedwell prosecuted the case on behalf of the United States.
Defendant Sentenced to over 25 Years in PrisonRead the Press Release
FORT WAYNE – Virgil S. Smith, 43, of Fort Wayne, Indiana, was sentenced by United States District Court Judge Holly A. Brady upon his plea of guilty to possessing methamphetamine with the intent to distribute, announced Acting U.S. Attorney Tina L. Nommay.
Smith was sentenced to 300 months (or 25 years) of imprisonment, to be followed by 5 years of supervised release after he serves this term of imprisonment. Smith was also sentenced to an additional and consecutive term of 30 months of imprisonment because he committed the drug offense while he was on supervised release for a prior conviction of armed bank robbery.
According to documents in this case, Smith was distributing multiple ounces of methamphetamine. After he was arrested, agents searched his apartment and located additional methamphetamine and a loaded revolver.
This case was investigated by the FBI’s Fort Wayne Safe Streets Gang Task Force, which includes the Federal Bureau of Investigation, the Indiana State Police, the Allen County Sheriff’s Department, and the Fort Wayne Police Department. This case was prosecuted by Assistant United States Attorneys Anthony W. Geller and Stacey R. Speith.
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Credit Union Branch Manager Charged with Embezzling $340,000, Then Setting Fire to the Safe to Conceal her TheftRead the Press Release
PITTSBURGH, PA – A resident of Belle Vernon, PA, has been indicted by a federal grand jury in Pittsburgh, PA on charges of embezzlement from a federal credit union, wire fraud, and use of fire to commit a federal felony, Acting United States Attorney Stephen R. Kaufman announced today.
The three-count Indictment named Patty Lynn Mavrakis, 63, as the sole defendant.
According to the Indictment, Mavrakis was a Branch Manager for Valley 1st Community Federal Credit Union and, in September 2016, she embezzled $340,200.00 from the credit union. In order to conceal the theft, she started a fire in the credit union’s safe, claiming that the fire destroyed the missing currency. In the days following the fire, she made an insurance claim on behalf of the credit union for the missing currency.
The law provides for a maximum total sentence of 60 years in prison, a fine of $1.5 million or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant. The government has requested $50,000 unsecured bond.
Assistant United States Attorney Lee J. Karl is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation and the Bureau of Alcohol, Tobacco, Firearms, and Explosives conducted the investigation leading to the Indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Clinical Researchers Sentenced in Connection with Scheme to Falsify Drug Trial DataRead the Press Release
A federal judge sentenced a Florida nurse practitioner and a Florida woman to prison terms today in connection with their participation in a conspiracy to falsify data related to clinical drug trials.
U.S. District Judge Jose E. Martinez of the Southern District of Florida sentenced Eduardo Navarro, 52, of Miami, to 46 months in prison, and Nayade Varona, 50, of Port St. Lucie, to 30 months in prison. The court also ordered the defendants to pay $2,134,503 in restitution. According to court documents, Navarro and Varona worked at a clinical research site called Tellus Clinical Research (Tellus). Navarro, a nurse practitioner, was a sub-investigator at Tellus, and Varona was an assistant study coordinator. As part of their plea agreements, Navarro and Varona admitted that they conspired with others to falsify data in connection with two clinical trials by, among other things, fabricating medical records to make it appear as though subjects were participating in the clinical trials when, in truth, they were not.
“By falsifying clinical trial data, the defendants undermined a crucial component of the drug approval process,” said Acting Assistant Attorney General Brian M. Boynton of the Justice Department’s Civil Division. “The Justice Department will continue to work with its partners at the Food and Drug Administration to investigate and prosecute anyone who engages in this conduct.”
“Falsifying clinical trial data puts the public’s health at risk,” said Acting U.S. Attorney Juan Antonio Gonzalez for the Southern District of Florida. “Compromised clinical data jeopardizes the researchers’ ability to evaluate the safety and efficacy of new drugs. Prosecuting these cases will continue to be a top priority for our office.”
“The FDA will continue to thoroughly investigate and bring to justice those who try to undermine clinical trials, an important part of the agency’s regulatory review of new drugs,” said Assistant Commissioner for Criminal Investigations Catherine Hermsen of the Food and Drug Administration (FDA). “The agency will aggressively pursue violations that threaten the integrity of clinical trial data in order to protect the public’s access to safe and effective products.”
The FDA’s Office of Criminal Investigations investigated this case.
Trial Attorneys Lauren M. Elfner and Joshua D. Rothman of the Civil Division’s Consumer Protection Branch are prosecuting the case. The U.S. Attorney’s Office for the Southern District of Florida has provided critical assistance.
Clifton Park Man Pleads Guilty to Possessing Child PornographyRead the Press Release
ALBANY, NEW YORK – Eric William Tompkins, age 37, of Clifton Park, New York, pled guilty today to 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 guilty plea before Senior United States District Judge Thomas J. McAvoy, Tompkins, a registered sex offender, admitted that on March 28, 2019, he possessed child pornography images on his cellular phone that included depictions of prepubescent children.
Tompkins faces at least 10 years and up to 20 years in prison, and a term of supervised release of at least 5 years and up to life, when he is sentenced on December 15, 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.
This case was investigated by the FBI and its Child Exploitation Task Force, with assistance from the United States Marshals Service and the New York State Police, and is being prosecuted by Assistant U.S. Attorney Rachel Williams.
This case is prosecuted 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). Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit https://www.justice.gov/psc.
City of New Orleans Assistant Chief Mechanical Inspector Pleads Guilty to Using an Interstate Facility with Intent to Carry Unlawful ActivityRead the Press Release
NEW ORLEANS, LA – The U.S. Attorney’s Office announced today that BRIAN MEDUS, 44, of Covington, pleaded guilty as charged to violating Title 18, United States Code, Sections 371 and 1952(a)(3), conspiracy to use an interstate facility with intent to carry on unlawful activity.
According to Court documents, MEDUS, the Assistant Chief Mechanical Inspector for the City of New Orleans, Safety and Permits Department, solicited and accepted bribe money from James Mohamad, the Director of the Department of Inspection and Code Enforcement for the City of Kenner, in return for the issuance of fraudulent permits for Mohamad’s HVAC jobs. Throughout the course of the conspiracy, Mohamad paid MEDUS and others approximately $93,000 to further the bribery scheme. MEDUS utilized cell phones and the City of New Orleans’ internet-based LAMA system, facilities of interstate commerce, to further the scheme. LAMA is the City of New Orleans system for tracking code enforcement and permitting actions.
MEDUS faces a maximum term of imprisonment of five (5) years, a fine of not more than $250,000, a maximum of three years supervised release following any term of imprisonment, and a mandatory $100 special assessment fee. Sentencing is scheduled for November 17, 2021.
“The FBI is committed to aggressively pursuing those who violate the trust placed in them by the public and holding them accountable for their actions. Today’s guilty plea sends a clear message that individuals like Mr. Medus who engaged in a bribery scheme, will be held responsible,” said Douglas A. Williams, Jr. FBI New Orleans Special Agent in Charge. “I would like to thank the City of New Orleans Office of the Inspector General, the Metropolitan Crime Commission, and the U.S. Attorney’s Office for their partnerships in helping the FBI disrupt public corruption in Louisiana."
Ed Michel, Interim Inspector General, City of New Orleans, stated “The New Orleans OIG will continue to ensure employees who utilize their public office for personal gain are held accountable for their actions.”
The United States Attorney’s Office, Eastern District of Louisiana, stated that “Public trust in government institutions is essential for a healthy, functioning government. Any felonious breach of trust damages the very institutions designed to protect citizens from such hazards. Our office will continue partnering with local, state and federal investigative agencies to prosecute public corruption that compromises our institutions.”
This matter was investigated by the Federal Bureau of Investigation and the City of New Orleans/Office of Inspector General. Assistance was provided by the Louisiana State Licensing Board for Contractors. Assistant United States Attorney Tracey N. Knight is prosecuting the matter.
Charleston Man Pleads Guilty to Distributing MethamphetamineRead the Press Release
CHARLESTON, W.Va. – One of the 15 individuals charged as a result of the long-term investigation dubbed the “Woo Boyz” pleaded guilty today to distributing methamphetamine.
According to court documents, Jermaine Williams, 20, of Charleston, sold an ounce of 90% pure methamphetamine to a confidential informant on October 1, 2020 for $575. The transaction took place at the GoMart on Bigley Avenue in Charleston.
Williams pleaded guilty to distribution of methamphetamine and faces a mandatory minimum of five years and up to 40 years in prison when he is sentenced on November 18, 2021.
Acting United States Attorney Lisa G. Johnston made the announcement and commended the investigative work of the Drug Enforcement Administration (DEA), the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the Charleston Police Department, the Metropolitan Drug Enforcement Network Team (MDENT), the U.S. Marshals Service and the West Virginia State Police.
Senior United States District Judge John T. Copenhaver, Jr. presided over the hearing. Assistant United States Attorney Monica D. Coleman is handling the prosecution.
The investigation was part of the Department of Justice’s Organized Crime Drug Enforcement Task Force (OCDETF). OCDETF was established in 1982 to conduct comprehensive, multilevel attacks on major drug trafficking and money laundering organizations and is the keystone of the Department of Justice’s drug reduction strategy. Today, OCDETF combines the resources and expertise of its member federal agencies in cooperation with state and local law enforcement. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking organizations, transnational criminal organizations, and money laundering organizations that present a significant threat to the public safety, economic, or national security of the United States.
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. 2:21-cr-00032.
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California woman arraigned on federal firearms chargesRead the Press Release
ALBUQUERQUE, N.M. – Laura Swanquist-Chavez, 35, of the area of El Centro, California, was arraigned today in federal court on a two-count indictment charging her with making a false and fictitious statement to a licensed dealer of firearms and knowingly transferring a firearm to a convicted felon. Swanquist-Chavez has been released on pre-trial conditions pending trial.
According to the indictment, on or about Aug. 26, 2020, in Luna County, New Mexico, Swanquist-Chavez allegedly answered falsely and knowingly on the Bureau of Alcohol, Tobacco, Firearms and Explosives Form 4473 Firearms Transaction Record that she was the actual buyer of a firearm. As alleged in the indictment, Swanquist-Chavez was acquiring the firearm on behalf of another person, and made the statement to mislead the dealer about the lawfulness of the transaction.
At some point between Aug. 29, 2020, and Feb. 4, 2021, Swanquist-Chavez allegedly transferred possession of a firearm to Omar Cueva-Felix knowing that he had been convicted previously of a felony. As a convicted felon, Cueva-Felix could not legally possess a firearm or ammunition.
An indictment is only an allegation. A defendant is presumed innocent unless and until proven guilty. If convicted, Swanquist-Chavez faces up to 10 years in prison.
The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated this case.
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Casper Man Sentenced in Child Pornography CaseRead the Press Release
Acting United States Attorney Bob Murray announced today that KYLE DOUSSETT, age 49, of Casper, Wyoming, was sentenced by Federal District Court Judge Alan B. Johnson for possessing child pornography, violating his supervised release agreement related to the same charge. Doussett received a sentence of 120 months to be followed by 10 years of supervised release. Doussett was also ordered to pay a $100 special assessment fee and may be ordered to pay restitution, to be determined at a later date.
Doussett appeared before Federal District Court Judge Alan B. Johnson on June 1, 2021 and pled guilty to the sole charge in the indictment. His conviction came after a manager at the Casper Re-entry Center (CRC), where Doussett was an inmate, found a cell phone belonging to Dousette that contained images and video of girls less than 12 years of age in provocative poses and performing sexual acts.
“Doussett has clearly demonstrated his inability to stop this type of predatorial sexual behavior so 10 years in prison is a just sentence. His actions contribute to an ongoing problem of child exploitation where children are enticed into producing sexually explicit material. Our office is grateful that our federal law enforcement partners dedicate resources to identifying the victims of sexual predators,” said Acting United States Attorney, Bob Murray.
This crime was investigated by U.S. Immigration and Customs Enforcement Special Agent Nicole Bailey. Doussett was prosecuted by Assistant United States Attorney Christyne M. Martens.
Buffalo Man Going to Prison for Selling CocaineRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Malik Matthews, 22, of Buffalo, NY, who was convicted of conspiring to distribute cocaine, was sentenced to serve 41 months in prison by U.S. District Judge John L. Sinatra, Jr.
Assistant U.S. Attorneys Meghan E. Leydecker and Paul C. Parisi, who handled the case, stated that between June 2018 and October 2019, the defendant sold cocaine to an individual over 50 times. In addition, Matthews sold crack cocaine to an undercover police officer. On June 4, 2019, Buffalo Police Officers executed a search warrant at the defendant’s Grey Street residence. During the search they seized three loaded firearms, ammunition, two bags of suspected crack cocaine, five digital scales, a bottle of a cutting agent, and a box of sandwich bags.
The sentencing is the result of an investigation by the Buffalo Police Department, under the direction of Commissioner Byron Lockwood, and the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Stephen Belongia.
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Bristol, Tennessee Man Sentenced in $499,000 Unemployment Fraud SchemeRead the Press Release
ABINGDON, Va. – A Bristol, Tennessee man was sentenced today to 18 months in prison for conspiring with others to defraud the government of more than $499,000 and to commit mail fraud.
According to court documents, Larry D. Whited, 57, waived his right to be indicted and pleaded guilty in April 2021 to one count of conspiring to defraud the United States and one count of conspiracy to commit mail fraud with respect to benefits authorized and paid in connection with a presidentially declared major disaster or emergency.
Whited participated in a conspiracy to commit fraud against the United States in connection with a scheme involving the filing of fraudulent claims for pandemic unemployment benefits.
According to court documents, Whited, and others, conspired to collect personal identification information of more than 35 co-conspirators, including 15 inmates in the custody of the Virginia Department of Corrections, and to file fraudulent claims of pandemic-related unemployment benefits.
Over the course of nine months, the conspiracy filed fraudulent claims for at least 37 individuals, with a total actual loss to the United States of at least $499,000.
Acting United States Attorney Daniel P. Bubar of the Western District of Virginia, Darrell J. Waldon, IRS-CI Acting Special Agent in Charge of the Washington DC Field Office, and Syreeta Scott, Acting Special Agent-in-Charge, Philadelphia Region, U. S. Department of Labor Office of Inspector General announced the sentence today.
The Department of Labor Office of the Inspector General and the Internal Revenue Service – Criminal Investigation, the Norton Police Department, and the Russell County Sheriff’s Office investigated the case.
Assistant United States Attorney Daniel J. Murphy prosecuted the case.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
Atmore Woman Sentenced in Federal Court for Conspiring to Distribute MethamphetamineRead the Press Release
MOBILE, AL – An Atmore, Alabama, woman was sentenced on August 10, 2021, to 38 months in prison for her participation in a conspiracy to possess with intent to distribute methamphetamine ice.
According to court documents, Jordan Ashley Gabel, 34, distributed methamphetamine ice she obtained from various suppliers in Baldwin County, Alabama. Gabel was implicated in two traffic stops in which she was in possession of methamphetamine ice, both conducted by the Baldwin County Sheriff’s Office.
United States District Court Judge William H. Steele imposed the 38-month sentence, which amounted to a sentence of time served after giving Gabel credit for her custodial time served prior to the imposition of sentence. Judge Steele further ordered that Gabel would also serve five years on supervised release following her imprisonment. As conditions of her supervision, Gabel will undergo testing and treatment for drug abuse and a mental health evaluation, and she will be subject to a search of her person and premises upon reasonable suspicion. No fine was imposed but Judge Steele ordered that Gabel pay $100 in special assessments.The case was investigated by the Baldwin County Sheriff’s Office, the Baldwin County Drug Task Force, and the FBI’s Safe Streets Task Force. Assistant U.S. Attorney Gloria Bedwell prosecuted the case on behalf of the United States.
Anchorage Businessman Convicted and Sentenced for Walrus Ivory Trafficking and Tax EvasionRead the Press Release
ANCHORAGE – An Anchorage man was sentenced today to six months home confinement and more than $400,000 in fines and restitution for illegally trafficking in walrus ivory and failing to report business income to the IRS.
According to court documents, Walter Earl, 76, owner of The Antique Gallery, regularly trafficked in illegal walrus ivory for many years. On three separate occasions in 2017, Earl knowingly violated the Lacey Act by illegally purchasing and selling walrus ivory ‘head mounts’ (i.e. the skull and ivory tusks of a walrus) to undercover agents. In these unlawful sales, Earl tried to conceal the illegal nature of his activities by falsifying documents and lying to purchasers about the ivory’s source, stating the ivory was legal to purchase and sell due to its age and claiming he was legally allowed to purchase the walrus ivory because he employed Alaska Natives. In addition to those illegal sales and lies, the investigation uncovered that Earl had illegally purchased more than 50 walrus tusks, which he kept as inventory for future illegal sales.
Separately, the investigation revealed that Earl intentionally failed to file individual income tax returns for the years 2013 through 2017. Earl’s gross income included income from his antique business which totaled $679,245 for the five-year period. To avoid creating records of revenue and income, Earl kept inadequate business records, primarily used cash and structured transactions at various financial institutions to sidestep banking reporting requirements. He also instructed his employees not to report the income they earned.
Earl pleaded guilty to three felony wildlife trafficking counts under the federal Lacey Act and one count of tax evasion. As part of his sentence, the court ordered Earl to pay $185,000 in fines and $216,054 in restitution to the IRS for back taxes owed. The court also ordered Earl to forfeit 50 walrus tusks and other illegal marine mammal parts to the United States.
“This joint investigation revealed and recovered all the illicit profits from an underground operation trafficking in one of Alaska’s unique marine resources, the North Pacific Walrus,” said Acting U.S. Attorney Bryan Wilson, District of Alaska. “In addition to this illegal enterprise, the investigation uncovered the failure of a businessman to perform what millions of our citizens dutifully do each year – prepare, organize and pay their taxes. As the sentence today reflects, our office, in partnership with law enforcement agencies, has ensured Mr. Earl has profited not one penny from his illegal endeavors. We are committed to protecting Alaska’s wildlife resources and will pursue fraudulent business activity, no matter which type.”
“The U.S. Fish and Wildlife Service is committed to protecting our unique and highly vulnerable marine mammal species from illegal exploitation and commercialization,” said U.S. Fish & Wildlife Service, Office of Law Enforcement Special Agent in Charge Rory Stark. “Activities such as these not only impact the viability of walrus populations, but also subsistence and traditional handicraft creation relied on by Alaska Native people. We are dedicated to combatting all forms of illegal wildlife trafficking, especially those involving our domestic species of conservation concern.”
“Mr. Earl disregarded the law to further his business interests and he intentionally evaded paying his fair share of tax on those profits. Not only did he exploit natural resources, but he undermined our tax system through the unfair advantage he had over other businesses that play by the rules,” said IRS Criminal Investigation (IRS-CI) Acting Special Agent in Charge Corinne Kalve. “IRS-CI will continue to investigate those who operate outside the law and fail to pay their fair share of taxes.”
The U.S. Fish and Wildlife Service, Office of Law Enforcement (USFWS) and the IRS Criminal Investigation (IRS-CI) investigated the case. The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) also assisted in the investigation.
Assistant U.S. Attorney’s Aunnie Steward and Steve Skrocki prosecuted the case.
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10 August 2021
Woman Pleads Guilty to Lying on Passport ApplicationRead the Press Release
NEW ORLEANS – U.S. Attorney Duane Evans announced today that THERESA WOOD (“WOOD”) pled guilty as charged on August 5, 2021 to count one of an indictment for false statements in a passport application in violation of Title 18, United States Code, Section 1542 before U.S. District Judge Eldon E. Fallon.
According to papers signed by WOOD, she made an application for a U.S. passport for her minor child using information belonging to another individual. It is a crime to lie on a passport application. WOOD convinced a co-worker, who resembled the father of her minor child, to fraudulently claim to be the father at the signing of the application before a notary. The application would then be submitted to the State Department. WOOD faces a maximum term of imprisonment of ten years, a maximum fine of $250,000, a maximum term of supervised release of three years, and a mandatory $100 special assessment cost on the false statement charge. Sentencing is set for November 18, 2021.
U.S. Attorney Evans praised the work of the United States Diplomatic Security Service of the State Department in investigating this matter. Assistant U. S. Attorney Carter K. D. Guice, Jr. is in charge of the prosecution.
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Two Vauxhall Men Indicted in Scheme to Steal Mail, Commit Credit Card Fraud and Defraud United StatesRead the Press Release
NEWARK, N.J. – Two men were charged today for their roles in a conspiracy to possess stolen mail, including credit cards and pandemic relief credit cards, commit bank fraud, and defraud the U.S. Postal Service and the U.S. Department of the Treasury, Acting U.S. Attorney Rachael A. Honig announced.
Jarid Brooks, 27, and his brother, Justin Brooks, 21, both of Vauxhall, New Jersey, are charged by indictment with participating in a scheme to fraudulently obtain money from victim financial institutions and the U.S. Department of Treasury by obtaining credit cards issued by the victim financial institutions and Economic Impact Payment (EIP) cards issued by the U.S. Department of Treasury, which were stolen out of the U.S. mail by bribed U.S. Postal Service employees, and fraudulently using the stolen cards to make unauthorized purchases. They also are charged with aggravated identity theft. Jarid Brooks is also charged with possession with intent to distribute fentanyl and heroin, and Justin Brooks is charged with possession of a firearm with an obliterated serial number.
According to documents filed in this case and statements made in court:
From July 2019 to Oct. 6, 2020, Jarid Books and Justin Brooks obtained credit cards stolen from the U.S. mail by U.S. Postal Service letter carriers, and then fraudulently activated those credit cards. They used those credit cards to make and attempt to make purchases without the cardholders’ authorization, including buying gift cards and electronics. The investigation to date has revealed that the victims have incurred approximately $100,000 in intended and actual losses from fraudulent purchases made using their stolen credit cards. In addition to stealing and illegally using credit cards, Jarid Brooks and Justin Brooks also schemed to fraudulently use over $11,000 of funds pre-loaded onto EIP cards issued by the U.S. Department of Treasury and sent in the U.S. mail pursuant to the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), that were also stolen from the mail. The CARES Act authorized EIP payments structured as one-time refundable tax credits to certain eligible taxpayers of $1,200 for individuals, $2,400 for married couples filing jointly, and up to $500 for each qualifying child. The goal of this part of their fraud was for the conspirators to unlawfully obtain the government funds pre-loaded onto these cards, in amounts ranging from approximately $400 to approximately $2,400.
The indictment contains the following charges:
Counts
Defendants
Charge
1
Jarid Brooks
Justin Brooks
Conspiracy to Possess Stolen Mail, Commit Bank Fraud, Defraud the U.S. Postal Service and the U.S. Department of Treasury
2
Jarid Brooks
Justin Brooks
Receipt of Stolen Mail
3
Jarid Brooks
Justin Brooks
Bank Fraud
4
Jarid Brooks
Aggravated Identity Theft
5
Justin Brooks
Aggravated Identity Theft
6
Jarid Brooks
Possession with Intent to Distribute Fentanyl and Heroin
7
Justin Brooks
Possession of a Firearm with an Obliterated Serial Number
The conspiracy, possession of mail theft, and firearm possession charges are each punishable by a maximum potential penalty of five years in prison and a maximum fine of up to $250,000. The bank fraud charge is punishable by a maximum potential penalty of 30 years in prison and a maximum fine of up to $1 million. The aggravated identity theft charge carries a mandatory penalty of two years in prison, which must run consecutively to any other prison sentence imposed. The narcotics possession charge carries a maximum potential penalty of 20 years in prison and a maximum fine of up to $1 million.
Jarid and Justin Brooks were originally charged with Kyle Williams, 36, and Kyjuan Hutchins, 22, also of Vauxhall, in October 2020. The charges against Kyle Williams for his role in the stolen mail and bank fraud conspiracy are still pending. He is presumed innocent unless and until proven guilty. Hutchins has pleaded guilty for his role in the conspiracy and is awaiting sentencing.
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; special agents with the U.S. Postal Service – Office of Inspector General, under the direction of Special Agent in Charge Matthew Modafferi, Northeast Area Field Office; and special agents with the Office of the Treasury Inspector General for Tax Administration (TIGTA), under the direction of Special Agent in Charge Andrew McKay, with the investigation leading to today’s charges. She also thanked the Union County Prosecutor’s Office, the Caldwell Police Department, the Fairfield Police Department, the Boonton Police Department, and the Millburn Police Department for their assistance.
The government is represented by Assistant U.S. Attorney Elaine K. Lou of the Special Prosecutions Division in Newark.
The charge and allegations against Jarid and Justin Brooks are merely accusations, and they are presumed innocent unless and until proven guilty.
Texas Man Sentenced for Role in Scheme that Imported Steroids from China for Online SaleRead the Press Release
BOSTON – A Texas man was sentenced on Friday, Aug. 6, 2021 in federal court in Boston for his role in a scheme that imported raw steroids from China and selling them over the internet to customers across the United States.
Mark Lopilato, 57, of Sanger, Texas, was sentenced by U.S. Senior District Court Judge Mark L. Wolf to 41 months in prison and four years of supervised release. In February 2018, Lopilato pleaded guilty to conspiracy to distribute steroids. In April 2019, he failed to appear for his sentencing, and was subsequently arrested in September 2019. At the time of his arrest, Lopilato was in possession of counterfeit identification in another individual’s name but bearing his photograph.
From January 2016 to September 2016, an undercover agent purchased steroids listed for sale on a website that advertised various types of steroids for sale. The website provided instructions on how to place orders and pay for steroids, and further provided an email address operated by Lopilato.
Customers ordered steroids from Lopilato who forwarded the orders by email to co-conspirators Rhonda Fulton and Michael Fulton, who processed and prepared raw steroids according to the customers’ orders, packaged and mailed them. Lopilato and the Fultons ordered the raw steroids through the internet from China, then paid for and received the raw steroids by mail. Lopilato paid the Fultons for the preparation, packaging and mailing of the steroids to customers; he also paid his brother and co-conspirator, Michael Lopilato, to maintain and operate the website.
In January 2017, the Fultons and Lopilatos were arrested and charged for their roles in the steroid scheme. Searches recovered more than 60,000 dosage units of raw steroids, a tableting machine, steroid packaging and shipping materials, and approximately $20,000 in cash. The website used by Lopilato to advertise the steroids was also seized.
Michael Fulton and Rhonda Fulton pleaded guilty and were sentenced by Judge Wolf to time served, three years and two years of supervised release, respectively, in May 2019.
Michael Thomas Lopilato, 64, pleaded guilty and was sentenced by U.S. District Court Judge Patti B. Saris to one year of probation and was ordered to pay a fine in the amount of $2,000 in August 2018.
Acting United States Attorney Nathaniel R. Mendell; Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration, New England Division; Joshua McCallister, Acting Inspector in Charge of the U.S. Postal Inspection Service; Douglas Bartlett, Acting U.S. Marshal for the District of Massachusetts; North Reading Police Chief Michael P. Murphy; North Andover Police Chief Charles Gray; and Burlington Police Chief Thomas Browne made the announcement. Assistant U.S. Attorney Katherine Ferguson, Acting Chief of Mendell’s Narcotics and Money Laundering Unit, and Assistant U.S. Attorney Lindsey E. Weinstein, also of Mendell’s Narcotics and Money Laundering Unit, prosecuted the case.
Telemedicine Company Owner Charged in Superseding Indictment for $784 Million Health Care Fraud, Illegal Kickback and Tax Evasion SchemeRead the Press Release
A federal grand jury in Newark, New Jersey, returned a superseding indictment today charging a Florida owner of multiple telemedicine companies with orchestrating a health care fraud and illegal kickback scheme that involved the submission of over $784 million in false and fraudulent claims to Medicare. This is one of the largest Medicare fraud schemes ever charged by the Justice Department. The superseding indictment also charges the defendant with concealing and disguising the proceeds of the scheme in order to avoid paying income taxes.
Creaghan Harry, 53, of Highland Beach, Florida, is charged in the superseding indictment with one count of conspiracy to commit health care fraud and wire fraud, and four counts of income tax evasion. Harry previously was charged in an indictment along with co-conspirators Lester Stockett and Elliot Loewenstern with one count of conspiracy to defraud the United States and to pay and receive kickbacks, four counts of receipt of kickbacks, and one count of conspiracy to commit money laundering. Stockett and Loewenstern previously pleaded guilty. If convicted, Harry faces a maximum penalty of 20 years’ imprisonment for the conspiracy to commit health care fraud and wire fraud, five years’ imprisonment on each count of tax evasion, five years’ imprisonment for the conspiracy to defraud the United States and pay and receive kickbacks, 10 years’ imprisonment for each count of receipt of kickbacks, and 20 years’ imprisonment on the conspiracy to commit money laundering. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
According to allegations in the superseding indictment, Harry and his co-conspirators solicited illegal kickbacks and bribes from durable medical equipment (DME) suppliers and marketers in exchange for orders for DME braces and medications. Harry’s telemedicine companies then allegedly paid physicians to write medically unnecessary orders for these braces and medications. Harry’s telemedicine companies provided orders to DME suppliers that fraudulently billed Medicare over $784 million. Medicare ended up paying over $247 million.
In order to conceal and disguise the health care fraud and illegal kickback scheme, the superseding indictment alleges, Harry directed DME suppliers and marketers not to directly pay his telemedicine companies and instead to pay shell companies that had been opened in the names of straw owners in the United States and foreign countries, such as the Dominican Republic. Harry then transferred the funds from the shell companies to his telemedicine companies in order to pay physicians to write the unnecessary orders.
The superseding indictment alleges that Harry falsely claimed to prospective investors, lawyers and others that his telemedicine companies had not received any kickbacks. Harry instead falsely represented that the telemedicine companies had been receiving revenue of “about $10 million per year” from fees paid by patients to receive telemedicine services, when in fact the revenue of the telemedicine companies was derived from illegal kickbacks and bribes.
The superseding indictment further alleges that Harry committed income tax evasion in the calendar years between 2015 and 2018 by receiving the proceeds of the illegal scheme in the accounts of shell companies belonging to nominee owners and using those proceeds to live a lavish lifestyle. Harry did not file an income tax return or pay taxes on this income.
Assistant Attorney General Kenneth A. Polite of the Justice Department’s Criminal Division; Acting U.S. Attorney Rachael A. Honig for the District of New Jersey; Special Agent in Charge George M. Crouch of the FBI’s Newark Field Office; Special Agent in Charge Scott J. Lampert of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG); and Special Agent in Charge Michael Montanez of IRS-Criminal Investigations, Newark, made the announcement.
HHS-OIG, the FBI and IRS-Criminal Investigations are investigating the case.
Assistant Chief Jacob Foster of the Criminal Division’s Fraud Section’s National Rapid Response Strike Force and Trial Attorney Darren Halverson of the Newark Strike Force are prosecuting the case.
The Fraud Section leads the Health Care Fraud Strike Force. Since its inception in March 2007, the Health Care Fraud Strike Force, which maintains 15 strike forces operating in 24 federal districts, has charged more than 4,600 defendants who have collectively billed federal health care programs and private insurers for approximately $23 billion. In addition, the HHS Centers for Medicare and Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
The Fraud Section uses the Victim Notification System (VNS) to provide victims with case information and updates related to this case. Victims with questions may contact the Fraud Section’s Victim Assistance Unit by calling the Victim Assistance phone line at 1-888-549-3945 or by emailing [email protected]. To learn more about victims’ rights, please visit: https://www.justice.gov/criminal-vns/victim-rights-derechos-de-las-v-ctimas.
An indictment is merely an allegation, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Repeat Sex Offender Sentenced to 10 Years in Prison for Possession of Child PornographyRead the Press Release
BIRMINGHAM, Ala. – A federal judge yesterday sentenced a previously convicted sex offender for possession of child pornography, announced United States Attorney Prim F. Escalona and FBI Special Agent in Charge Johnnie Sharp, Jr.
United States District Judge Annmarie Axon sentenced Darrell Dewayne Thrasher, 62, of Tuscaloosa County, to 120 months in prison to be followed by a lifetime supervised release. In April 2021, Thrasher pleaded guilty to possession of child pornography.
“Possession of child pornography is an insidious crime that continues to sexually exploit a child every time an image is downloaded or shared,” U.S. Attorney Escalona said. “Every child deserves a safe childhood, and my office remains committed to vigorous prosecution of child exploitation in this district.”
“Thrasher is a repeat child sex offender and deserves every day of this sentence,” FBI SAC Sharp said. “The FBI will continue to aggressively investigate and pursue those who would exploit our children. To report online child sexual exploitation, use the electronic Cyber Tip Line or call 1-800-843-5678. The Cyber Tip Line is operated by the National Center for Missing and Exploited Children in partnership with the FBI.”
According to the plea agreement, in August 2019, Thrasher’s federal probation officer conducted a home visit and found five smart phone devices at Thrasher’s residence. Thrasher admitted he used three of the smart phones to download child pornography, and that he possessed child pornography on those devices. A forensic examination of the smart phones revealed multiple images and videos of children being abused and exploited. Thrasher was on federal supervision for receipt of child pornography at the time. Thrasher’s supervision was revoked in September 2019. The terms of Thrasher’s supervised release included a restriction from possessing a smart phone device.
In 2008, Thrasher was convicted in the U.S. District Court Northern District of Alabama of receipt of child pornography. In 2009, Judge Karon O. Bowdre sentenced Thrasher to 97 months in prison. Thrasher was released in December 2016 on 10 years of supervised release.
Thrasher has remained in the custody of law enforcement since his arrest in August 2019.
The FBI investigated the case, along with the Northport Police Department. Assistant United States Attorneys R. Leann White and John Hundscheid prosecuted the case.
The case was brought as part of Project Safe Childhood, a nationwide initiative launched by the Department of Justice in May 2006 to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Rensselaer County Felon Sentenced to 30 Months on Firearms ConvictionsRead the Press Release
ALBANY, NEW YORK – Brandon Glaski, age 38, of East Nassau, New York, was sentenced today to 30 months in prison for unlawfully possessing firearms including “ghost guns,” as well as ammunition, a machinegun conversion device, and silencers.
The announcement was made by Acting United States Attorney Antoinette T. Bacon and John B. DeVito, Special Agent in Charge of the New York Field Division of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF).
United States District Judge Mae A. D’Agostino also sentenced Glaski to a 3-year term of supervised release.
On June 12, 2018, investigators with ATF and the New York State Police (NYSP) executed a federal search warrant at Glaski’s residence in East Nassau. Stored in locked gun lockers in Glaski’s bedroom, as well as in unlocked containers in a hallway closet, basement and garage, were 23 rifles, 15 handguns, seven silencers, one machinegun conversion device, 101 ammunition magazines, and over 5,000 rounds of assorted ammunition. The recovered firearms included two rifles without serial numbers (“ghost guns”), as well as 15 finished rifle and pistol lower receivers lacking serial numbers.
In pleading guilty, Glaski admitted that he had ordered the machinegun conversion device and silencers from Internet-based suppliers. At the time he possessed the firearms and ammunition, Glaski had a prior state felony conviction for impaired driving.
This case was investigated by ATF, with assistance provided by NYSP, and prosecuted by Assistant U.S. Attorney Emmet J. O’Hanlon.
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.
Pittsburgh Man Admits to Drug Trafficking ChargesRead the Press Release
PITTSBURGH - A resident of Pittsburgh, Pennsylvania, pleaded guilty in federal court to conspiracy to distribute heroin, fentanyl, crack cocaine, powder cocaine, and alprazolam and to possession with intent to distribute those same substances, Acting United States Attorney Stephen R. Kaufman announced today.
Justin Misko, age 37, from the Hazelwood neighborhood of Pittsburgh, pleaded guilty to two counts before United States District Judge David S. Cercone the morning of August 9, the day that Misko’s jury trial was scheduled to begin.
In connection with the guilty plea, the court was advised that from October 2018 to December 6, 2018, Misko conspired with others to distribute heroin, fentanyl, crack cocaine, powder cocaine, and alprazolam, which is more commonly known as Xanax. Misko and other conspirators distribute these drugs in various establishments in the Waterfront of West Homestead, including Dave & Busters and the Courtyard Marriot. On Dec. 6, 2018, Pittsburgh Police detectives and FBI Task Force Officers arrested Misko at the Marriot hotel based on an unrelated matter. After seeing officers in the hallway, Misko locked himself in his room with a coconspirator. The coconspirator threw two bags off the balcony into the courtyard. An FBI Task Force Officer who was positioned in the Courtyard caught the two bags, which were found to contain more than 17 bricks of heroin and fentanyl and distribution quantities of crack cocaine, powder cocaine, and alprazolam.
Judge Cercone scheduled sentencing for Dec. 14, 2021 at 1:00 pm. For each charge, Misko may be sentenced up to 20 years in prison, fined $1,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Misko had been detained pending trial, and the Court ordered that Misko continue to be detained pending sentencing.
Assistant United States Attorney Brian M. Czarnecki is prosecuting this case on behalf of the government.
This case resulted from the investigations of multiple agencies, including the FBI, the West Homestead Police, and the Pittsburgh Bureau of Police.
Philadelphia Tax Preparer Pleads Guilty to False ReturnsRead the Press Release
A Pennsylvania man pleaded guilty yesterday to assisting in the preparation of false federal tax returns.
According to court documents, Jean Coq, of Philadelphia, prepared tax returns for clients for tax years 2013 and 2014 that claimed inflated itemized deductions and adjustments to income. As a result of these false items, Coq’s clients sought tax refunds to which they were not entitled. In total, Coq caused a tax loss to the IRS of $83,451.
Coq is scheduled to be sentenced on Nov. 10. He faces a maximum sentence of three years in prison on each count, as well as a period of supervised release, restitution and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and Acting U.S. Attorney Jennifer Arbittier Williams of the U.S. Attorney’s Office for the Eastern District of Pennsylvania made the announcement.
The IRS-Criminal Investigation investigated the case.
Trial Attorney Ann Marie Cherry of the Justice Department’s Tax Division and Assistant U.S. Attorney David J. Ignall of the U.S. Attorney’s Office for the Eastern District of Pennsylvania are prosecuting the case.
Philadelphia Man Sentenced to 10 Years in Prison for Conspiring to Possess and Distribute Drugs and Possessing a FirearmRead the Press Release
JOHNSTOWN, Pa. – A resident of Philadelphia, PA, has been sentenced in federal court to a total of ten years (120 months) in prison and five years’ supervised release on his conviction of conspiracy to distribute and possess methamphetamine and cocaine and possession of a firearm. Acting United States Attorney Stephen R. Kaufman announced today.
United States District Judge Kim R. Gibson imposed the sentence on Gerald Terry, 52, of Philadelphia, PA.
According to information presented to the court, between March 30, 2018, and April 4, 2018, Gerald Terry and a co-conspirator conspired to distribute and to possess with the intent to distribute more than 500 grams of a mixture and substance containing a detectable amount of methamphetamine and cocaine. Further, on April 4, 2018, they were found in possession of a loaded Smith & Wesson M&P Shield .40 caliber semi-automatic pistol.
Assistant United States Attorney Arnold P. Bernard, Jr. prosecuted this case on behalf of the government.
Mr. Kaufman commended the Laurel Highlands Resident Agency of the Federal Bureau of Investigation, the Pennsylvania State Police SHIELD Unit and Somerset Turnpike Barracks for the investigation that led to the successful prosecution of Terry.
Pesticide Smuggler Sentenced to Jail, Ordered to Pay $10,000Read the Press Release
Assistant U. S. Attorney Melanie K. Pierson (619) 546-7976
NEWS RELEASE SUMMARY – August 10, 2021
SAN DIEGO – Mark Lee Morgan of Santa Ana, California, was sentenced in federal court Friday to 14 days in custody and ordered to pay a fine of $10,000 plus restitution of $1,360 for the cost of disposal of the pesticides, and to perform 120 hours of community service.
In pleading guilty, Morgan admitted that on November 19, 2020, he entered the United States from Mexico with 34 bottles of undeclared Mexican pesticides in his truck (DDVP 500U, containing the active ingredient of dichlorvos). Morgan owns a feed store in Compton, California, and admitted to agents that he intended to take the products to his store to sell them. Morgan further admitted that he was aware that the pesticide he was smuggling was illegal to import and use in the United States, and that he had smuggled it in on previous occasions.
The pesticide in the formulation smuggled by the defendant is illegal in the United States. Dichlorvos is lethal if ingested, absorbed through the skin, or inhaled. It is highly toxic to bees and birds, acutely toxic to fish and aquatic invertebrates, and can have chronic and long-lasting effects.
According to sentencing documents, DDVP 500U, the chemical smuggled by the defendant, is commonly found at locations where marijuana is illegally cultivated. Exposure to these pesticides during eradication efforts has caused law enforcement officers to be hospitalized and has polluted soils and streams and killed wildlife. Cannabis users are also at risk. In one study, the pesticide transfer rate into the blood stream of a cannabis smoker using a glass pipe was as high at 70 percent.
“The defendant was willing to risk the health of others and the environment for his own commercial profit,” said Acting U.S. Attorney Randy Grossman. “The U.S. Attorney’s Office is committed to keeping these dangerous chemicals out of the wrong hands.”
“These pesticides seized at our border are highly toxic and anyone attempting to smuggle them into the United States is not only committing a very serious crime, but also jeopardizing the health of those who are exposed to it,” said Cardell T. Morant, Special Agent in Charge of U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) San Diego. “HSI and our law enforcement partners will continue to work together to prevent smugglers from illegally importing dangerous substances into this country.”
“The defendant’s efforts to deceive law enforcement by smuggling these pesticides into the United States put people at risk” said Scot Adair, Special Agent in Charge of the EPA’s criminal enforcement program in California. “U.S. EPA and its partner agencies will continue to fight against illegal imports of pesticides that pose a threat to human health and the environment.”
DEFENDANT Case Number 21cr0495-TWR
Mark Lee Morgan Age: 68 Santa Ana, CA
SUMMARY OF CHARGES
Smuggling – Title 18, U.S.C., Section 545
Maximum penalty: Twenty years in prison and $250,000 fine
AGENCIES
Homeland Security Investigations
U.S. Environmental Protection Agency, Criminal Investigation Division
Palm Beach Resident Pleads Guilty to Conspiracy to Commit Wire FraudRead the Press Release
Miami, Florida – Fifty-year old Palm Beach County resident James Cleary pled guilty on Friday, August 6 to participating in a fraud scheme that bilked investors out of more than $393,500.
During Friday’s hearing before U.S. Magistrate Judge Bruce Reinhart in West Palm Beach, Cleary 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. Cleary, 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. Cleary admitted that he reached most of his victims through cold calls and that he personally profited from the investor funds.
Cleary 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 Cleary on a date to be announced. Cleary 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 Cleary 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 Russell C. Weigel, III, 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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Owners of Florida Teacher Certification Exam Preparation Company Plead Guilty to Racketeering Conspiracy and Conspiracy to Commit Theft of Trade SecretsRead the Press Release
TALLAHASSEE, FLORIDA –Kathleen M. Jasper, 42, and Jeremy M. Jasper, 40, both of Estero, Florida, pled guilty today to racketeering (RICO) conspiracy and conspiracy to commit theft of trade secrets. Jason R. Coody, Acting United States Attorney for the Northern District of Florida, announced the guilty pleas.
Court documents reflect since January 2016, the Jaspers, who are both certified Florida teachers, stole content and conspired with others to steal content from the Florida Teacher Certification Exams (FTCE) and the Florida Educational Leadership Exam (FELE) and included the stolen content in the test preparation materials and services that were sold through their business, NavaEd, LLC (“NavaEd”) for personal profit.
NavaEd, LLC, was a company that offered tutoring and training to prepare prospective Florida educators to successfully take and pass the FTCE and the FELE. Passage of these exams are required for certification in the state of Florida. NavaEd offered training publications for sale worldwide directly through its website and through third-party e-commerce websites such as Amazon and Shopify. Both Kathleen and Jeremy Jasper took the FTCE and FELE multiple times – after having already passed the exams – in order see and memorize, or harvest, as many different exam questions as possible. The Jaspers also directed NavaEd employees and independent contractors to take the FTCE and FELE for the purpose of harvesting exam questions and answers.
The Jaspers and NavaEd customers shared the stolen FTCE and FELE test content with each other through email, phone, video conferencing, and messaging applications. The Jaspers republished the stolen FTCE and FELE test content – verbatim and almost verbatim – into NavaEd publications that were written to prepare future Florida teachers and school administrators for the certification exams. These publications and other NavaEd FTCE and FELE preparation materials were disseminated and used during NavaEd training seminars and tutoring sessions.
Both defendants face a potential maximum penalty of 20 years in prison for RICO conspiracy. Further, both defendants face a maximum penalty of 10 years in prison for conspiracy to commit theft of trade secrets.
The Jaspers’ sentencing hearings are scheduled for November 15, 2021, at 9:00 AM at the United States District Court in Tallahassee before the Honorable District Judge Allen Winsor.
This case was jointly investigated by the Florida Department of Law Enforcement, the United States Department of Education – Office of Inspector General, and the Florida Department of Education, with assistance by Pearson VUE, the company with whom the Florida Department of Education contracted to administer, and provide test security for, the FTCE and FELE. Assistant United States Attorney Justin M. Keen is prosecuting 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.
Northwestern PA Brothers Indicted in Cryptocurrency Investment SchemeRead the Press Release
ERIE, Pa. - Two residents of Pennsylvania have been indicted by a federal grand jury in Erie on charges of conspiracy to commit wire fraud, wire fraud and money laundering, Acting United States Attorney Stephen R. Kaufman announced today.
The 65-count Indictment named Shane Hvizdzak, 33, of Bradford, Pennsylvania and Sean Hvizdzak, 35, of Saint Marys, Pennsylvania, as defendants.
According to the Indictment presented to the court, the defendants conspired to defraud investors in a limited partnership that was represented as an investment in cryptocurrency. Investor funds were not invested in the manner represented to investors but were rather diverted into the defendants’ personal accounts and provided to entities having nothing to do with cryptocurrency. The defendants also provided false information about the purported investment’s performance to induce new investors to become involved and also lull those investors who had already become involved into a false sense of security. The funds of subsequent investors were also provided to initial investors and misrepresented as returns on their investment.
The law provides for a maximum total sentence of 810 years in prison, a fine of $12,500,000, or both for Shane Hvizdzak and a maximum total sentence of 550 years in prison, a fine of $7,000,000 or both for Sean Hvizdzak. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Christian A. Trabold is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation and the Internal Revenue Service, Criminal Investigation conducted the investigation leading to the Indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
New York woman admits to role in drug trafficking ringRead the Press Release
MARTINSBURG, WEST VIRGINIA – Argelianka Garcia, of New York, New York, has admitted to her involvement in a drug conspiracy that spanned several states, Acting U.S. Attorney Randolph J. Bernard announced.
Garcia, 44, pleaded guilty today to one count of “Conspiracy to Possess with Intent to Distribute and to Distribute Cocaine Hydrochloride and Cocaine Base.” Garcia admitted to working with others to distribute more than 98 grams of cocaine base, also known as “crack,” and more than 10 grams of cocaine hydrochloride from June to December 2019 in Berkeley and Jefferson Counties.
Garcia faces up to 20 years of incarceration and a fine of up to $1,000,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
This case is the result of investigations supported by the Organized Crime Drug Enforcement Task Force (OCDETF) under the Attorney General-led Synthetic Opioid Surge (SOS)/Special Operations Division (SOD) Project Clean Sweep. This initiative seeks to reduce the supply of synthetic opioids in “hot spot” areas previously identified by the Attorney General of the United States, thereby reducing drug overdoses and drug overdose deaths, and identify wholesale distribution networks and sources of supply operating nationally and internationally. 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.
Assistant U.S. Attorney Lara Omps-Botteicher and Special Assistant U.S. Attorney C. Lydia Lehman, also with the Berkeley County Prosecuting Attorney’s Office, are prosecuting the case on behalf of the government. The FBI; Homeland Security Investigations; the Bureau of Alcohol, Tobacco, Firearms & Explosives; and the Eastern Panhandle Drug Task Force, a HIDTA-funded initiative, investigated.
U.S. Magistrate Judge Robert W. Trumble presided.
Find the related press release here: https://www.justice.gov/usao-ndwv/pr/25-charged-six-state-drug-conspiracy-involving-heroin-fentanyl-cocaine
New York Man Sentenced to 24 Months in Prison for Role in Identity Theft ConspiracyRead the Press Release
NEWARK, N.J. – A Bronx, New York, man was sentenced today to 24 months in prison for his participation in a scheme involving a network of individuals who used stolen payment card information in New Jersey and throughout the United States, Acting U.S. Attorney Rachael A. Honig announced.
Albert Miller, 29, previously pleaded guilty to aggravated identity theft before U.S. District Judge William J. Martini. Judge Martini imposed the sentence this morning in Newark federal court.
According to documents filed in this case and statements made in court:
Miller participated in a network of individuals who obtained stolen payment card information and utilized the information to make fraudulent purchases throughout the United States. Miller previously acknowledged that he recruited so-called “travelers,” who carried out the scheme. Miller personally profited from each of his recruits’ illicit transactions. Miller also acknowledged providing stolen payment card and other personal information to other members of the scheme to facilitate additional fraudulent transactions.
In addition to the prison term, Judge Martini also sentenced Miller to one year of supervised release and ordered him to pay restitution of $1.43 million.
Acting U.S. Attorney Honig credited special agents with the U.S. Secret Service, Newark Field Office, under the direction of Special Agent in Charge Mark McKevitt with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Shawn Barnes of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
New York Man Admits Conspiring to Defraud New Jersey of $19 Million in Motor Fuel TaxRead the Press Release
NEWARK, N.J. – A New York man today admitted to his role in a wire fraud conspiracy which defrauded the State of New Jersey of over $19 million in motor fuel tax, Acting U.S. Attorney Rachael A. Honig announced.
Roman Sobolevsky, 61, of Brooklyn, New York, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to an information charging him with one count of conspiracy to commit wire fraud.
According to documents filed in this case and statements made in court:
Between June 2019 and July 2020, Sobolevsky was the president of a Brooklyn-based motor fuel distribution company, identified in court documents as “Company-1.” Company-1 purchased motor fuel from a Texas-based motor fuel supplier (Fuel Supplier-1) at fuel terminals in Newark and Sewaren, New Jersey. Sobolevsky and others devised a scheme to falsely represent to Fuel Supplier-1 that Company-1 was delivering fuel to gas stations in Delaware, when, in fact, Company-1 was delivering fuel to gas stations in New Jersey. By doing so, Sobolevsky and Company-1 avoided paying New Jersey state fuel tax, which did not apply to fuel delivered outside of New Jersey. After Company-1’s fuel trucks picked up the fuel from Fuel Supplier-1, Sobolevsky directed the drivers to deliver the fuel to gas stations in New Jersey and not Delaware. The New Jersey gas station owners, knowing that Sobolevsky falsely represented to Fuel Supplier-1 that the fuel was being delivered to Delaware, purchased fuel from Sobolevsky and Company-1 at a lower price than other distributors. As a result, Sobolevsky and avoided paying approximately $19 million in motor fuel taxes owed to the State of New Jersey.
The conspiracy to commit wire fraud charge carries a maximum potential penalty of 20 years in prison and $250,000 fine, or twice the gross gain or loss from the offense. Sentencing is scheduled for Dec. 14, 2021.
Acting U.S. Attorney Honig credited special agents of the Department of Homeland Security, Homeland Security Investigations, under the directions of Special Agent in Charge Jason J. Molina, and the New Jersey Department of the Treasury, Division of Taxation, Office of Criminal Investigation, under the direction of Supervising Special Agent Marijane Lamattina, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Christopher Amore of the Government Fraud Unit in Newark.