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4 August 2021
Centre County Woman Sentenced for Mail TheftRead the Press Release
WILLIAMSPORT - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Jessica Stover, age 27, of Millheim, Pennsylvania, was sentenced on August 3, 2021, by Chief U.S. District Court Judge Matthew W. Brann to one year of probation for theft of mail. Stover was also ordered to pay $350 in restitution and a $300 fine.
According to Acting U.S. Attorney Bruce D. Brandler, Stover entered a guilty plea in March 2021 to theft of mail matter by a Postal Employee where she admitted to opening greeting cards and other mail at a U.S. Post Office sorting facility for mail destined for students at Pennsylvania State University.
The case was investigated by the United States Postal Service Office of Inspector General. Assistant United States Attorney Geoffrey W. MacArthur prosecuted the case.
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Canadian Man Pleads Guilty to Conspiracy to Fraudulently Acquire Personal Protective Equipment and Event TicketsRead the Press Release
OKLAHOMA CITY – Yesterday, STEVEN MESROP, 29, of Richmond Hill, Ontario, Canada pleaded guilty to participating in a conspiracy to commit wire fraud involving a scheme to fraudulently acquire personal protective equipment and event tickets, announced Acting U.S. Attorney Robert J. Troester.
On June 15, 2021, a federal grand jury returned a Superseding Indictment against Mesrop and seven other people. All defendants were charged with conspiracy. In addition, Mesrop and another conspirator were charged with wire fraud and aggravated identity theft.
According to the Superseding Indictment, Mesrop and his associates operated a scheme to use stolen credit card and identity information to induce businesses to provide goods and services, such as event tickets and personal protective equipment, to resell for a profit. At the onset of the COVID-19 pandemic, the conspirators began targeting U.S.-based businesses selling goods that were scarce due to the pandemic. The conspirators allegedly used stolen credit card information to purchase items such as nitrile gloves, masks, and gowns and to resell them to third parties. The Superseding Indictment alleges the conspirators operated the scheme from Canada, the Dominican Republic, Spain, Greece, and Dubai. The Superseding Indictment alleges the conspirators targeted sports teams and event venues throughout the United States and Canada, including Madison Square Garden in New York City.
The Superseding Indictment further alleges that Mesrop and his associates used 21 different alias email accounts and information from 52 stolen credit cards to purchase over 1,800 tickets to Oklahoma State University athletic events between November 2019 and January 2020. In March 2020, the conspirators allegedly used stolen credit card information to purchase approximately thousands of dollars’ worth of toilet paper from a paper supply company in Oklahoma City.
Yesterday, Mesrop pleaded guilty to conspiracy to commit wire fraud. At sentencing, Mesrop faces a term of imprisonment of up to 20 years and a potential fine of $250,000. He has been in custody since his arrest on March 18, 2021.
This case is the result of an investigation by the Federal Bureau of Investigation’s Oklahoma City Field Office, Homeland Security Investigations New York Office – El Dorado Task Force, the New York City Police Department, and the Irvine (California) Police Department, with assistance from Customs and Border Protection. The case is being prosecuted by Assistant U.S. Attorney William Farrior.
Reference is made to court filings for further information.
California man sentenced to more than six years in prison for meth trafficking in Billings areaRead the Press Release
BILLINGS — A California man who admitted to trafficking methamphetamine after law enforcement officers found eight kilograms, or 17.6 pounds, of the drug hidden in a vehicle he was driving was sentenced today to six years and six months in prison to be followed by five years of supervised release, Acting U.S. Attorney Leif M. Johnson said.
Christopher Santillanes Ceja, 31, of Riverside, California, pleaded guilty on March 8 to possession with intent to distribute meth.
U.S. District Judge Susan P. Watters presided.
In court documents filed in the case, the government alleged that law enforcement agents learned in March 2019 about a shipment of meth being transported from Mexico to Billings. Law enforcement surveillance saw a vehicle with a California license plate registered to Ceja pull into a Billings hotel. Ceja was known to law enforcement as having been involved in meth trafficking in the Billings area. Later that same evening, officers conducted a traffic stop of the vehicle and Ceja was driving. Agents impounded and searched the vehicle pursuant to a warrant. Agents located 19 bundles of meth concealed throughout the vehicle. The meth totaled eight kilograms, or about 17.6 pounds, of pure meth. Eight kilograms of meth is the equivalent of about 63,782 doses.
Assistant U.S. Attorney Lori H. Suek prosecuted the case, which was investigated by the FBI’s Western Transnational Organized Crime Task Force and the Eastern Montana High Intensity Drug Trafficking Area Task Force.
This case is part of Project Safe Neighborhoods, a U.S. Department of Justice initiative to reduce violent crime. According to the FBI’s Uniform Crime Reports, violent crime in Montana increased by 48% from 2013 to 2019. Through PSN, federal, tribal, state and local law enforcement partners in Montana focus on violent crime driven by methamphetamine trafficking, armed robbers, firearms offenses and violent offenders with outstanding warrants.
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California man indicted on drug chargeRead the Press Release
WHEELING, WEST VIRGINIA – Victor L. Roebuck, II, of Long Beach, California, was indicted today on a marijuana charge, Acting United States Attorney Randolph J. Bernard announced.
Roebuck, 33, was indicted on one count of “Possession with Intent to Distribute Marijuana.” Roebuck is accused of having marijuana in May 2021 in Ohio County.
Roebuck faces up to five years of incarceration and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Shawn M. Adkins is prosecuting the case on behalf of the government. The West Virginia State Police investigated.
An indictment is merely an accusation. A defendant is presumed innocent unless and until proven guilty.
California Woman Sentenced to Federal Prison for Conspiring to Distribute MethamphetamineRead the Press Release
A California woman who traveled from California to Sioux City to distribute methamphetamine was sentenced July 30, 2021, to more than 10 years in federal prison.
Leslie Aranda-Moreno, age 27, from San Diego, California, received the prison term after a March 19, 2021, guilty plea to conspiracy to distribute methamphetamine.
In a plea agreement, Aranda-Moreno admitted that in January 2020, she conspired to distribute methamphetamine in the Northern District of Iowa, and elsewhere.
On or about January 30, 2020, Homeland Security Investigations agents were contacted by officers from the Colorado State Patrol regarding a vehicle being driven by Aranda-Moreno that had been stopped and searched in Colorado. The officers found the vehicle contained approximately seven (7) pounds of methamphetamine. It was determined that Aranda-Moreno would pick up large quantities of methamphetamine from Mexico in California and drive them to Sioux City for distribution.
Aranda-Moreno was sentenced in Sioux City by United States District Court Chief Judge Leonard T. Strand. Aranda-Moreno was sentenced to 122 months’ imprisonment. She must also serve a 5-year term of supervised release after the prison term. There is no parole in the federal system.
Aranda-Moreno is being held in the United States Marshal’s custody until she can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Ron Timmons and was investigated by the Iowa Division of Narcotics Enforcement, Homeland Security Investigations, Buena Vista County Sheriff’s Office, and Colorado State Patrol.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 20-4056.
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Attorney Sentenced for Conspiracy to Commit Wire Fraud and Money LaunderingRead the Press Release
DENVER – Former California attorney David Kaplan, of Las Vegas, was sentenced on August 3, by U.S. District Court Judge Christine M. Arguello for conspiracy to commit wire fraud and money laundering.
According to the information contained in court documents, between approximately September 2014 through October 2015, Kaplan and two other individuals worked to defraud investors out of money and property through materially false and fraudulent representations. The co-conspirators obtained approximately $12 million from investors by claiming they could invest risk-free in offshore investments with an occasional 10% return on investment per month. As part of the scheme, Kaplan established and controlled business entities, including several charitable organizations, to deposit and transfer investor funds and pay himself for personal expenses. Using his position and attorney trust accounts, Kaplan was able to gain the trust of investors and create the pretense that investor monies were held in trust. Kaplan made payments to investors to lull them and encourage the recruitment of additional investors.
”Of course, attorneys are not above the law, and this sentencing demonstrates that we can, and will, prosecute anyone who breaks the law to the fullest extent,” said Acting U.S. Attorney Matt Kirsch. “We are proud of the cumulative effort of all who helped ensure Mr. Kaplan could not victimize additional investors.”
Kaplan, who diverted over $2 million for his own personal benefit, pled guilty on April 7, 2021 and was sentenced to 36 months in prison yesterday. Kaplan, never disclosed to investors the precise amount of financial benefit he was to receive, including the terms of his compensation, costs or fees, or the identity of the “Fiduciary,” despite investor requests for this information.
“Investment schemes that seem too good to be true should be a warning to investors to stay clear,” said IRS-Criminal Investigation Special Agent in Charge Andy Tsui. “This sentencing shows that IRS-CI will use all its investigative tools to stop the criminal behavior of those who prey on investors for their own personal financial gain.”
“Mr. Kaplan capitalized on his position of trust as an attorney to create an elaborate investment scheme, touting inflated returns and even leveraging support for several charities, all of which proved to be a mirage that cost investors millions," said FBI Denver Special Agent in Charge Michael Schneider. "Today’s sentence sends a message that the FBI will find criminals who greedily prey on investors and corrupt financial markets no matter how clever they believe they are. We thank IRS-Criminal Investigation and the U.S. Attorney’s Office for their diligent work on this case."
This case was investigated by the Internal Revenue Service – Criminal Investigation and the Federal Bureau of Investigation. This case was prosecuted by Assistant United States Attorney Tim Neff.
Case Number: 19-cr-00237
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Anchorage Man Convicted of Sex Trafficking and Drug OffensesRead the Press Release
ANCHORAGE – A federal jury convicted an Anchorage man on three counts of sex trafficking and one count of drug distribution after a six-day jury trial before U.S. District Judge Joshua M. Kindred. The jury reached its verdicts after one day of deliberations.
According to court documents, Davon Smith, 28, was charged with one count of sex trafficking a minor, one count of benefitting from a sex trafficking enterprise, one count of trafficking an adult by force, fraud or coercion and one count of possession with intent to distribute heroin. According to evidence presented at trial, Smith trafficked an adult and runaway juvenile victim in early 2019. Smith had a previous drug conviction and was on federal supervised release at the time he committed the offenses.
This is the second sex trafficking trial in the District of Alaska in recent months. Tristan Grant was convicted of several offenses including child sex trafficking and the production of child pornography following a bench trial before Senior U.S. District Judge Ralph R. Beistline. Grant’s sentencing is scheduled for September 15 at 9:00 a.m. in Anchorage.
“Individuals looking to profit from the sexual exploitation of children and adults in our community should be on notice that the consequences could include a life term of imprisonment in a federal prison,” said Acting U.S. Attorney Bryan Wilson, District of Alaska. “Our success in prosecuting these offenses results from the courage of the victims and the effective coordination between the Anchorage Police Department and the Federal Bureau of Investigation.”
“As demonstrated by this guilty verdict, recruiting adults and minors for commercial sex acts, and profiting from their exploitation, won’t be tolerated here in Alaska,” said Acting Special Agent in Charge Adam Pierce of the FBI’s Anchorage Field Office. “While we can’t erase the trauma these survivors experienced, by continuing to aggressively investigate sex trafficking crimes, and with a victim-centered approach, the FBI and our partners on the Child Exploitation and Human Trafficking Task Force are ensuring those who commit such crimes are held accountable.”
Smith is scheduled to be sentenced on November 15 in Anchorage. Smith faces a mandatory minimum sentence of 15 years and a maximum sentence of life imprisonment. He also faces a term of supervised release of not less than five years and up to life. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The Federal Bureau of Investigation (FBI) and the Anchorage Police Department (APD) investigated this case as part of the FBI’s Child Exploitation and Human Trafficking Task Force. The task force marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children through sex trafficking, as well as to identify and recover victims.
Assistant U.S. Attorneys Jennifer Ivers and Adam Alexander are prosecuting the case.
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 U.S. Attorneys’ Offices, Project Safe Childhood combines 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 visitwww.justice.gov/psc.
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Alleged Shooter Indicted on Felon in Possession of Firearm ChargesRead the Press Release
LOUISVILLE, KY – A federal grand jury in Louisville, Kentucky, returned an indictment today charging a Louisville man with being a felon in possession of a firearm.
According to court documents, Laron Weston 28, shot two individuals on July 26, 2021, in the area of 4900 block of Manslick Road, Louisville, Kentucky. The red Hummer that Weston was driving at the time of the shooting was located that day by Louisville Metro Police Department (“LMPD”) officers. An LMPD officer attempted to conduct a traffic stop, and Weston fled from the officer in the vehicle. After a brief pursuit, Weston wrecked into another vehicle. Weston then exited the vehicle and attempted to flee on foot. LMPD officers followed. After Weston pointed a handgun at one of the officers, a Glock 35 GEN4, .40 caliber pistol with a drum magazine, another LMPD officer tackled WESTON, taking him into custody.
Weston is charged with being a felon in possession of a firearm. The defendant is currently in state custody on a federal arrest warrant awaiting transfer to federal custody. If convicted, he faces a maximum penalty of no more than 10 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting U.S. Attorney Michael A. Bennett of the Western District of Kentucky and Special Agent in Charge R. Shawn Morrow of the Bureau of Alcohol, Tobacco and Firearm (ATF), made the announcement.
The ATF and LMPD are investigating the case.
Assistant U.S. Attorney Ann Marie Blaylock 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.
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A Wilson Four-Time Felon Sentenced After Jury TrialRead the Press Release
RALEIGH, N.C. – A Wilson man was sentenced today to 84 months in prison for being a felon in possession of a firearm. On March 23, 2021, Terrance Anthony Moore, 35, was convicted of the charge by a jury.
According to court records and evidence presented at trial, Moore possessed a firearm on July 8, 2018. Moore was seen by law enforcement standing on the side of the road in Wilson, raising and lowering the firearm in the direction of nearby businesses. Moore took the stand and testified, among other things, that he had a number of previous felony convictions, including two common law robberies and a drug distribution offense, within the previous ten years. He also testified that his nickname was “Trigger” due to his violent temper.
G. Norman Acker, III, Acting U.S. Attorney for the Eastern District of North Carolina made the announcement after sentencing by U.S. District Judge Terrence W. Boyle. The Wilson Police Department and Bureau of Alcohol, Tobacco, Firearms and Explosives investigated the case and Assistant U.S. Attorney Lucy Brown prosecuted the case.
Related court documents and information can be found on the website of the U.S. District Court for the Eastern District of North Carolina or on PACER by searching for Case No. 5:19-CR-164-BO.
9 Defendants Indicted in Interstate Gun Trafficking SchemeRead the Press Release
Deputy Attorney General Lisa O. Monaco joined Audrey Strauss, the United States Attorney for the Southern District of New York, John B. DeVito, Special Agent in Charge of the New York Field Division of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”), and Dermot Shea, Police Commissioner for the City of New York (“NYPD”), for the announcement today of a third superseding indictment charging JAMES THOMAS, a/k/a “Spazz,” DUVAUGHN WILSON, a/k/a “Dupree,” COURTNEY SCHLOSS, a/k/a “Bway,” a/k/a “Balenci,” KEN ALEXANDER, a/k/a “Ryu,” ARGAM TAJ, a/k/a “Sour,” SAMUEL TAJ, a/k/a “Sosa,” CHRISTOPHER MACHADO, a/k/a “Chris Elite,” HARLIE RAMOS, a/k/a “White Girl,” and JAMEL THOMAS, a/k/a “Mel,” with conspiracy to commit gun trafficking and gun trafficking, in connection with their involvement in a scheme to illegally transport firearms from Georgia for resale to residents of New York. THOMAS, WILSON, and SCHLOSS were also charged with interstate travel with intent to engage in gun trafficking. This case is assigned to United States District Judge Sidney H. Stein.
JAMEL THOMAS and ARGAM TAJ were arrested this morning in SDNY and will be presented before U.S. Magistrate Judge Robert W. Lehrburger later today. KEN ALEXANDER was arrested this morning in the District of Massachusetts and will be presented before a magistrate judge in Boston later today. WILSON, SCHLOSS, and JAMES THOMAS were previously charged; SCHLOSS and JAMES THOMAS are currently in custody. HARLIE RAMOS, SAMUEL TAJ, and CHRISTOPHER MACHADO remain at large.
Manhattan U.S. Attorney Audrey Strauss said: “Today’s arrests shut down the alleged gun pipeline of these nine defendants. These arrests should also send a message to anyone who is thinking about illegally selling guns to New Yorkers or illegally bringing guns to New York: We and our law enforcement partners are watching. And we will prosecute gun traffickers to the fullest extent of the law.”
ATF Special Agent in Charge John B. DeVito said: “The individuals named in the indictment are alleged to have participated in a trafficking scheme which flooded our New York City Streets with illegal firearms. Combatting firearms trafficking lies at the heart of ATF’s strategy to stop violent gun crime. Exploitation of Crime Gun Intelligence along with effective collaboration with our law enforcement partners will allow us to disrupt and dismantle groups such as this that in turn fuel the violence in our communities. I would like to thank the New York Police Department for their partnership on this case and the United States Attorney’s Office for their leadership.”
Police Commissioner Dermot Shea said: “The NYPD continues to work closely with our law enforcement partners to drive down gun violence and stop the trafficking of illegal firearms in New York City. I commend the work of the investigators and prosecutors whose hard work resulted in these arrests, firearms seizures, and indictment.”
According to the allegations in the Superseding Indictment unsealed today in Manhattan federal court:[1]
From at least in or around August 2020 up to and including April 2021, the defendants used Georgia resident DUVAUGHN WILSON, a/k/a “Dupree,” as a straw purchaser to buy at least 87 firearms from at least six federal firearms licensees (“FFLs”) in Georgia. Over the course of the scheme, during which WILSON completed approximately 30 different transactions, WILSON attested that he was the true purchaser of the firearms, when in fact he was buying the guns on behalf of the defendants, who in turn illegally resold many of the guns to others.
Prior to purchases, the defendants coordinated with WILSON to place orders for specific firearms and pay for the weapons using cash, mobile banking applications, and through wire payments. When communicating about the firearms, the defendants used coded language, referring to the weapons as “tvs,” “knocks,” and “situations.” In some instances, the defendants referred to the caliber or model of a firearm by referencing the jersey numbers of famous athletes.
After purchasing the weapons, WILSON transferred the firearms to defendants JAMES THOMAS, a/k/a “Spazz,” COURTNEY SCHLOSS, a/k/a “Bway” a/k/a “Balenci,” and others who (i) sold some of the guns in Georgia and (ii) transported other firearms, primarily by bus, to New York for resale. In many instances, the guns were transferred to members of the Brooklyn-based “Blixky Gang” – a group composed primarily of aspiring rappers. Some of these guns later appeared in music videos filmed by members of the Blixky Gang. The videos, which include some of the defendants charged today, show Blixky Gang members brandishing loaded firearms and displaying stacks of cash.
On some occasions, law enforcement successfully interdicted firearms being transported by the defendants before they reached New York. For example, in November 2020, law enforcement in South Carolina stopped a bus in Wellford, South Carolina, from which they seized five firearms, four pistol magazines, a high capacity .40 caliber magazine, and a nine-millimeter drum magazine – all of which were being transported by the defendants in a single backpack.
Law enforcement in New York City seized other firearms purchased in Georgia by WILSON. On at least two occasions, in the wake of violent crimes, the NYPD seized firearms trafficked to New York as part of this scheme. As alleged, in February 2021, the NYPD seized a gun that WILSON had bought after a fleeing suspect discharged it at responding officers in the Bronx. And in April 2021, following a shooting in the Bronx, the NYPD seized another pistol purchased by WILSON.
To date, law enforcement authorities across numerous jurisdictions have recovered a total of 18 firearms purchased by WILSON in the course of the scheme.
A chart containing the names, charges, and maximum and minimum penalties for the defendants is set forth below. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.
Ms. Strauss praised the outstanding investigative work of the ATF and the New York City Police Department. Ms. Strauss thanked Lisa O. Monaco, the Deputy Attorney General of the United States, for the Department of Justice’s support and leadership in the area of gun trafficking. Ms. Strauss also thanked local law enforcement partners as well as those in Georgia, Virginia, Pennsylvania, and South Carolina, including the ATF’s Greenville Field Office, Boston Field Division, and Atlanta Field Division; the Manhattan District Attorney’s Office; the New York/New Jersey Regional Fugitive Task Force; the Duncan Police Department, Wellford Police Department, and Spartanburg County Sheriff’s Office in South Carolina; the Clayton County Sherriff’s Office in Georgia; the Rockingham County Sherriff’s Office and Virginia State Police in Virginia; the Pennsylvania State Police; the United States Marshals Service; and the United States Attorney’s Offices in the Eastern District of New York, the Northern District of Georgia, the District of South Carolina, and the District of Massachusetts.
This case is being handled by the Office’s General Crimes Unit. Assistant United States Attorneys Ashley C. Nicolas and Matthew J. King are in charge of the prosecution.
The charges in the Indictment are merely accusations and the defendants are presumed innocent unless and until proven guilty.
Count
Charge
Defendants
Max. Penalty
1
Conspiracy to Commit (i) Gun Trafficking, and (ii) Illegal Transportation or Receipt in State of Residency of Firearm Purchased or Acquired Outside of State of Residency
JAMES THOMAS, a/k/a “Spazz,”
DUVAUGHN WILSON,
a/k/a “Dupree,”
COURTNEY SCHLOSS, a/k/a “Bway,” a/k/a “Balenci,”
KEN ALEXANDER, a/k/a “Ryu,”
ARGAM TAJ, a/k/a “Sour,”
SAMUEL TAJ, a/k/a “Sosa,”
CHRISTOPHER MACHADO, a/k/a “Chris Elite,”
HARLIE RAMOS, a/k/a “White Girl,”
JAMEL THOMAS, a/k/a “Mel”
Five years
2
Gun Trafficking
JAMES THOMAS, a/k/a “Spazz,”
DUVAUGHN WILSON,
a/k/a “Dupree,”
COURTNEY SCHLOSS, a/k/a “Bway,” a/k/a “Balenci,”
KEN ALEXANDER, a/k/a “Ryu,”
ARGAM TAJ, a/k/a “Sour,”
SAMUEL TAJ, a/k/a “Sosa,”
CHRISTOPHER MACHADO, a/k/a “Chris Elite,”
HARLIE RAMOS, a/k/a “White Girl,”
JAMEL THOMAS, a/k/a “Mel”
Five years
3
Interstate Travel With Intent to Engage in Gun Trafficking
JAMES THOMAS, a/k/a “Spazz,”
DUVAUGHN WILSON,
a/k/a “Dupree,”
COURTNEY SCHLOSS, a/k/a “Bway,” a/k/a “Balenci,”
10 years
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth in this release constitute only allegations, and every fact described should be treated as an allegation.
16 Defendants Charged for Drug Trafficking in LansingRead the Press Release
GRAND RAPIDS, MICHIGAN — U.S. Attorney Andrew Birge announced today that 16 defendants were arrested and charged with drug-trafficking crimes arising out of the Lansing, Michigan area. Eight defendants were charged in a criminal complaint with conspiring to distribute heroin, fentanyl, and cocaine. Seven other defendants were charged in a different criminal complaint with conspiring to distribute methamphetamine and fentanyl. One defendant was charged by indictment with possession with intent to distribute methamphetamine, fentanyl, and cocaine base.
During the arrests of the defendants and execution of 15 search warrants, federal, state, and local investigators seized bulk quantities of cash, methamphetamine, heroin, and fentanyl. Investigators also seized more than twenty firearms.
Further details of the allegations can be found in the indictment, complaints and supporting affidavits, which were unsealed yesterday. Fourteen of the defendants made their initial appearances yesterday, and two defendants made their initial appearances today.
The charges are the result of a multi-agency investigation by federal, state, and local law enforcement. The Drug Enforcement Administration (DEA); Lansing Police Department (LPD), including Lansing Police Department Special Operations Section (LPD SOS); Homeland Security Investigations (HSI); Michigan State Police (MSP); Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF); United States Marshals Service (USMS); and the Internal Revenue Service (IRS) have all supported the investigation. Over 150 federal, state, and local law enforcement officers from Michigan, Illinois, and Ohio assisted with the search warrants and arrests yesterday.
The charges in the criminal complaint are merely accusations and are not evidence of guilt. The defendants are presumed innocent until and unless proven guilty in a court of law. The government has the burden of proving guilt beyond a reasonable doubt.
The below images show some of the items recovered during the arrests and searches:
The following individuals were charged in the complaints and indictment:
Name
Age
Case No.
Edward Washington
39
1:21-mj-401
Demanuel Porter
33
1:21-mj-401
Jamar Street
30
1:21-mj-401
Latisha Mack
32
1:21-mj-401
Jerome Till
50
1:21-mj-401
Ebony Malone
36
1:21-mj-401
Michael Terry
33
1:21-mj-401
Angela Dority
46
1:21-mj-401
Davanti Heard-White
30
1:21-mj-410
John Humphrey
32
1:21-mj-410
Marquise Brooks
33
1:21-mj-410
Miguel Schooler
24
1:21-mj-410
Arnon Lake
34
1:21-mj-410
Demetrus Heard
29
1:21-mj-410
Jeffrey Humphrey
52
1:21-mj-410
Jordan Suttles
30
1:21-cr-141
3 August 2021
U.S. Foreign Service Member Indicted for Engaging in Illicit Sexual Conduct in the Philippines and Possession of Child PornographyRead the Press Release
ALEXANDRIA, Va. – A federal grand jury in the Eastern District of Virginia returned an indictment today charging a member of the Foreign Service with engaging in illicit sexual conduct in a foreign place and possession of child pornography.
According to the indictment and court documents, Dean Cheves, 61, between September 2020 and February 2021, was a member of the U.S. Foreign Service, serving at the U.S. Embassy in the Philippines. While in the Philippines, Cheves allegedly met a 16-year-old online. Court documents further detail that Cheves allegedly engaged in sexual activity with the minor on two occasions, knowing the minor’s age, and produced cell phone videos of himself engaging in the sex acts each time. The videos were found on Cheves’s devices seized from his embassy residence while in the Philippines. Between February 2021 and March 2021, he also allegedly possessed child pornography.
Cheves is charged with one count of engaging in illicit sexual conduct in a foreign place and one count of possessing child pornography in the special maritime and territorial jurisdiction of the United States or on lands owned or leased by the United States. Cheves previously made his initial court appearance on July 6, 2021 before U.S. Magistrate Judge Ivan D. Davis of the U.S. District Court for the Eastern District of Virginia.
If convicted, he faces a maximum penalty of up to 30 years in prison on count one and up to 10 years in prison on count two. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney Raj Parekh of the Eastern District of Virginia; Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division; and Mark Sullo, Assistant Director for Domestic Operations, U.S. Department of State’s Diplomatic Security Service, made the announcement.
The Diplomatic Security Service, Office of Special Investigations is investigating the case.
Assistant U.S. Attorney Lauren Pomerantz Halper and Trial Attorney Gwendelynn Bills of the Justice Department’s Child Exploitation and Obscenity Section are prosecuting the case.
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 U.S. Attorneys’ Offices and the Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:21-cr-177.
U.S. Foreign Service Member Indicted for Engaging in Illicit Sexual Conduct in the Philippines and Possession of Child PornographyRead the Press Release
A federal grand jury in the Eastern District of Virginia returned an indictment today charging a member of the U.S. Foreign Service with engaging in illicit sexual conduct in a foreign place and possession of child pornography.
According to the indictment and court documents, Dean Cheves, 61, was a member of the U.S. Foreign Service serving at the U.S. Embassy in the Philippines between September 2020 and February 2021. While in the Philippines, Cheves allegedly met a 16-year-old online. Court documents further detail that Cheves allegedly engaged in sexual activity with the minor on two occasions, knowing the minor’s age, and produced cell phone videos of himself engaging in the sex acts each time. The videos were found on Cheves’s devices seized from his embassy residence while in the Philippines. Between February 2021 and March 2021, he also allegedly possessed child pornography.
Cheves is charged with one count of engaging in illicit sexual conduct in a foreign place and one count of possessing child pornography in the special maritime and territorial jurisdiction of the United States or on lands owned or leased by the United States. Cheves previously made his initial court appearance on July 6 before U.S. Magistrate Judge Ivan D. Davis of the U.S. District Court for the Eastern District of Virginia. If convicted, he faces a maximum penalty of up to 30 years in prison on count one, and up to 10 years in prison on count two. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division, Acting U.S. Attorney Raj Parekh for the Eastern District of Virginia made the announcement and Assistant Director for Domestic Operations Mark Sullo of the U.S. Department of State’s Diplomatic Security Service made the announcement.
The Diplomatic Security Service, Office of Special Investigations is investigating the case.
Trial Attorney Gwendelynn Bills of the Justice Department’s Child Exploitation and Obscenity Section and Assistant U.S. Attorney Lauren Pomerantz Halper of the U.S. Attorney’s Office for the Eastern District of Virginia are prosecuting the case.
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 U.S. Attorneys’ Offices and the Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
U.S. Attorney’s Office to take part in National Night OutRead the Press Release
WHEELING, WEST VIRGINIA – The U.S. Attorney’s Office, Northern District of West Virginia, will join law enforcement, community leaders and residents on Tuesday, August 3rd at events in Martinsburg, Bridgeport, and Wheeling to celebrate the 37th annual National Night Out crime prevention event.
“Our law enforcement partners across the district work tirelessly to protect our communities. We support them on this day and every day in their efforts,” said Randolph J. Bernard, Acting U.S Attorney, Northern District of West Virginia. “Our staff will spread a message of drug prevention and positivity at this year’s event. We are also giving away one backpack filled with school supplies at each location to support the importance of education.”
The U.S. Attorney’s Office will participate at Wheeling Park’s Ice Rink, Martinsburg’s War Memorial Park, and Bridgeport’s Recreational Complex, with each event from 6:00-8:00 p.m.
National Night Out is a community-building and crime prevention campaign that promotes collaborative law enforcement-community partnerships and neighborhood camaraderie. Thousands of communities nationwide will participate in neighborhood block parties, festivals, cookouts, safety demonstrations, seminars, and activities that heighten crime and drug prevention awareness and generate support for and participation in local anticrime efforts. Events such as these help to strengthen neighborhood spirit, police-community partnerships, and demonstrate a shared commitment for strong and safe communities.
U.S. Attorney’s Office to Take Part in Spokane’s National Night Out Against CrimeRead the Press Release
Spokane – Joseph H. Harrington, Acting United States Attorney for the Eastern District of Washington, announced that on Tuesday, August 3rd, members from his office will participate in community events held as part of Spokane’s National Night Out Against Crime.
National Night Out is an annual community-building campaign that promotes police-community partnerships and neighborhood camaraderie to make our neighborhoods safer, more caring places to live. National Night Out enhances the relationship between neighbors and law enforcement while bringing back a true sense of community. Furthermore, it provides a great opportunity to bring law enforcement and the community together under positive circumstances.
“Keeping our communities safe is a top Justice Department priority, as it is for state, local and Tribal police departments across the country,” said Attorney General Merrick B. Garland. “Law enforcement is most effective when it has the trust and support of the communities it serves. That is why events like National Night Out are so important and effective; they help to bridge the gap between neighbors and their police departments in a positive and informal setting.”
Joseph H. Harrington said, “National Night Out Against Crime is an outstanding opportunity for neighbors to gather with their law enforcement and community partners. When such groups gather they demonstrate that battling crime in our communities is truly a collective responsibility. The United States Attorney’s Office for the Eastern District of Washington looks forward to joining others tonight to help continue to spread the important message that we are all in this together.”
For more information visit www.spokanecops.org
U.S. Attorney's Statement on Second Anniversary of Walmart ShootingRead the Press Release
Ashley C. Hoff, the United States Attorney for the Western District of Texas, releases this statement on the second anniversary of the mass shooting in an El Paso Walmart that resulted in the deaths of 23 individuals and injured numerous others.
“We remain steadfast in pursuing justice for the victims, their families, the El Paso community, the State of Texas, and our Nation as a whole for the suffering caused by this incomprehensible act of hate. Our thoughts remain with those who have had their lives changed forever as we reflect on the memories of those we have lost.”
Two Montana men charged with $1 million COVID-19 relief fraud schemeRead the Press Release
BILLINGS – Two Montana men were arraigned recently on charges in connection with a scheme to defraud a bank of approximately $1 million in Paycheck Protection Program (PPP) loans and to use those funds for their personal benefit, including buying property and vehicles, Acting U.S. Attorney Leif M. Johnson said today.
Trevor Gene Lanius-McLeod, also known as Trevor Gene McLeod, 48, of Laurel, and Kasey Jones Wilson, 29, of Helena, each pleaded not guilty to an indictment charging them with bank fraud and with engaging in monetary transactions in property derived from specified unlawful activity. If convicted of the most serious crime, the defendants face a maximum 30 years in prison, a $250,000 fine and three years of supervised release.
Lanius-McLeod was arraigned on July 27 before U.S. Magistrate Judge John T. Johnston in Great Falls. Wilson was arraigned on July 27 before U.S. Magistrate Judge Timothy J. Cavan in Billings. Both defendants were released pending further proceedings.
The government alleged in court documents, that from about April 2020 to December 2020, the defendants applied for and received four PPP loans totaling $1,043,000 through Valley Bank of Helena, a Division of Glacier Bank, on behalf of four business entities. Lanius-McLeod applied for funds as the authorized representative of T. McLeod Holdings LLC, Hilltop Estates LLC, and Renovated Montana Properties LLP. Lanius-McLeod and Wilson applied for funds as the authorized representatives of Step Above Management LLC. In the applications, the defendants made numerous false statements about having paid payroll taxes and having employees. In promissory notes, the defendants agreed to use the loan funds for payroll costs, costs related to group health care benefits and insurance premiums, rent, utilities, interest on payments on debt and refinancing a Small Business Administration Economic Injury Disaster Loan. Instead, the defendants spent the funds on personal expenses for their private benefit. If convicted, the defendants face the forfeiture of property related to the crimes, including property in East Helena, four vehicles and a travel trailer.
The PPP program, which is part of the federal Coronavirus Aid, Relief and Economic Security (CARES) Act, provided emergency assistance to small businesses for job retention and certain other expenses.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Assistant U.S. Attorney Colin M. Rubich is prosecuting the case, which was investigated by the IRS-Criminal Investigation and FBI, with assistance from the U.S. Treasury Inspector General for Tax Administration and U.S. Secret Service.
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.
PACER case reference. 21-07.
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Trimble County Man Sentenced to 180 Months for the Distribution of Child PornographyRead the Press Release
FRANKFORT, Ky. – A Bedford, Ky., man, Leonard J. Andrew, Jr., 36, was sentenced on Tuesday to 180 months in federal prison, by U.S. District Judge Gregory VanTatenhove, for the distribution of child pornography.
According to his plea agreement, on February 7, 2018, Andrew admitted to sending multiple explicit videos and images of minors to at least two different recipients via Facebook Messenger. The videos and images sent by Andrew contained images of minors engaged in sexual activity and were sent to recipients outside of Kentucky.
Andrew pleaded guilty in November 2020.
Under federal law, Andrew must serve 85 percent of his prison sentences. Andrew will be under the supervision of the U.S. Probation Office for 25 years, following his release
Carlton S. Shier, IV, Acting United States Attorney for the Eastern District of Kentucky; Jerry Templet, Special Agent in Charge of Homeland Security Investigations (HSI); and Colonel Phillip Burnett, Commissioner, Kentucky State Police; jointly announced the sentences.
The investigation was conducted by the DHS-HSI and KSP. The United States was represented by Assistant U.S. Attorney Erin Roth.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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Three Federal Trials: Three Guilty VerdictsRead the Press Release
LITTLE ROCK—The week of July 26, 2021, brought three guilty verdicts in separate federal trials. A combination of pandemic-related delays and a significant increase in caseload resulted in four simultaneous jury trials in federal court last week. One trial is expected to last several weeks, and the other three concluded last week with the convictions of three defendants.
The week’s first trial began Monday morning with a case in which Sparkle Hobbs, aka Sparkle Bryant, 33, of Little Rock, was charged with conspiracy to possess with intent to distribute heroin, methamphetamine, and fentanyl. She was also charged with possession with intent to distribute methamphetamine and fentanyl, possession of firearms in furtherance of a drug trafficking crime, and misprision (concealment) of a felony.
The evidence at trial indicated that Hobbs sold methamphetamine to an informant, which led to a search warrant at her residence in February of 2018. Law enforcement located five firearms, approximately $29,000 in cash, 103 grams of fentanyl, 497 grams of methamphetamine, and .049 grams of heroin in the residence. The jury returned their guilty verdict Tuesday evening. The Drug Enforcement Administration; Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF); and Arkansas State Police conducted the investigation, which is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF. The case was prosecuted by Assistant United States Attorneys Anne Gardner and Amanda Jegley and tried before United States District Judge Kristine G. Baker.
The second guilty verdict of the week was returned on Friday morning. A jury convicted Darby Leroy Williams, 30, of North Little Rock, of being a felon in possession of two firearms and ammunition. Williams has prior felonies for distribution of drugs and is on parole because of those convictions. Law enforcement received information that Williams was dealing drugs from his residence. In March of 2018, North Little Rock Police Department (NLRPD) and Arkansas Community Corrections (ACC) conducted a parole search of Williams’ home and located two handguns, a Glock and a Ruger, both of which were loaded, as well as ammunition, methamphetamine, and marijuana. The case was investigated by NLRPD, ACC, and the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF). The case was prosecuted by Assistant United States Attorneys Cameron McCree and Lauren Eldridge and was also tried before Judge Baker.
The final guilty verdict arrived late Friday evening, when jurors deliberated for only 20 minutes after hearing the evidence against Ryan Kinsey, 35, of Beebe, who was charged with one count of Social Security fraud and one count of making materially false statements to the Social Security Administration (SSA). Kinsey was initially approved for Social Security Disability benefits in 2013 and had those benefits continued in June 2018. Part of the paperwork that Kinsey filled out in May 2018 to extend his benefits included sections where he affirmed that he was not working and was physically incapable of working based on his disability. But also in June 2018, a SSA employee with the Searcy field office noticed that, based on the physical appearance of Kinsey and the fact that he arrived at the office driving a truck with a large horse trailer attached, Kinsey appeared as if he had been working. A subsequent SSA-OIG investigation revealed that Kinsey had been working as a horse rancher on his family farm in Beebe. At trial, the United States called numerous witnesses who all testified that during the time periods alleged they had either bought horses or hay from Kinsey or had Kinsey transport livestock. In the 15 months prior to indictment, Kinsey received more than $100,000 in payments for his ranching activities. During that same time period, he fraudulently received more than $20,000 from SSA. The case was investigated by SSA-OIG, prosecuted by Assistant United States Attorneys Bart Dickinson and Chris Givens, and tried before United States District Judge Lee P. Rudofsky.
The fourth trial that began last week, United States v. Gilbert Baker, is expected to last several weeks and has been paused due to a positive COVID-19 test from one of the trial participants. It is scheduled to resume Tuesday morning pending negative COVID-19 test results from the remaining trial participants.
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This news release, as well as additional information about the office of the
United States Attorney for the Eastern District of Arkansas, is available online at
https://www.justice.gov/edar
Twitter:
@EDARNEWS
Texas Man Pleads Guilty for His Role in Cocaine Conspiracy Stretching from El Paso to BuffaloRead 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 Edgar Pavia, 44, of El Paso, Texas, pleaded guilty before U.S. District Judge John L. Sinatra, Jr. to conspiring to possess with intent to distribute, and distributing, five kilograms or more of cocaine, and conspiring to commit money laundering. The charges carry a mandatory minimum penalty of 15 years in prison, a maximum of life, and a $20,000,000 fine.
Assistant U.S. Attorney Michael J. Adler, who is handling the case, stated that between October 2017, and December 7, 2018, the defendant conspired with Eduardo Enrique Valdez, Adrian Goudelock, Eric Young, Lance Parker, Jai Hunter, Daniel Sterling, Martin Lopez, Ivan Rene Rios Bustillos, Adrian Grier, Shamar Davis, and Gabrielle McGrady, to sell cocaine and hide the proceeds of their illegal drug trafficking.
On October 2, 2017, Pavia and co-defendant Eduardo Enrique Valdez traveled from El Paso to Cleveland, OH. The defendant admits that while in Cleveland, two co-defendants traveled from Buffalo to Cleveland to pick up 10 kilograms of cocaine to take back to Buffalo. The cocaine was secreted in the spare tire of their vehicle.
Investigators determined that during the course of the cocaine conspiracy, Pavia and his co-defendants frequently rotated their phones, which were almost exclusively utilized in furtherance of the drug conspiracy. The defendant’s phones had frequent contact with both a Mexican source of supply, co-defendant Adrian Goudelock, co-defendant Adrian Grier, and co-defendant Daniel Sterling. Numerous court-authorized wire and electronic communications were intercepted during the investigation. Those interceptions revealed that Pavia was brokering bulk quantity cocaine to multiple areas in the country including Buffalo, as well as locations in Kentucky and Georgia. On July 25, 2018, investigators seized 17 kilograms of cocaine from the vehicle of co-defendant Lance Parker. Shortly after the seizure, Pavia was intercepted discussing the seizure with Adrian Goudelock, who suggested to Pavia that they “chill for a few weeks” but then “keep goin.” They also discussed their new phones before ceasing use of their then-current phones.
Co-defendants Lance Parker, Eduardo Enrique Valdez, Ivan Rene Rios Bustillos, Daniel Sterling, and Adrian Grier were previously convicted. Charges remain pending against co-defendants Adrian Goudelock, Eric Young, Jai Hunter, Martin Lopez, Shamar Davis, and Gabrielle McGrady. The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
The plea is the result of an investigation by Homeland Security Investigations (HSI) - Buffalo, under the direction of Special Agent-in-Charge Kevin Kelly; the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Stephen Belongia; the New York State Police, under the direction of Major James Hall; the Erie County Sheriff’s Department, under the direction of Sheriff Timothy Howard; and Customs and Border Protection, Air and Marine Unit, under the direction of Brian Manaher, Director, Marine Operations. Additional assistance was provided by the New York National Guard; HSI-Louisville; the Kentucky State Police; the Louisville Metro Police; and the Greater Hardin County Drug Task Force.
Sentencing is scheduled for February 2, 2022, at 2:00 p.m. before Judge Sinatra.
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Tennessee Prison Inmate Sentenced to Federal Prison for White Powder Mailing HoaxRead the Press Release
NASHVILLE – Jeffery Durance, 38, of Gatlinburg, Tennessee, and an inmate of the Tennessee Department of Correction, was sentenced yesterday in U.S. District Court to three years in prison for mailing a threatening communication and conveying false information while threatening to use a Weapon of Mass Destruction (WMD), announced Acting U.S. Attorney Mary Jane Stewart for the Middle District of Tennessee.
Durance was indicted in July 2019 after he mailed an envelope containing a white powder to the Commissioner of the Tennessee Department of Correction, Tony Parker, on September 6, 2018. The envelope was sent through the U.S. Mail to the Tennessee Tower State Office Building in Nashville and contained a threatening letter, which caused a reasonable belief that the powder contained a biological agent or toxin, which would constitute a WMD. The Powder was later determined to be an inert material.
Durance pleaded guilty to the charges in March of this year.
This case was investigated by the FBI; the Tennessee Highway Patrol; the Tennessee Department of Correction; the Metropolitan Nashville Police Department; and the Metropolitan Nashville Fire Department. Assistant U.S. Attorney Robert S. Levine is prosecuting the case.
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Stoneham Woman Pleads Guilty to Identity Theft and Unemployment Fraud Related to COVID-19 PandemicRead the Press Release
BOSTON – A Stoneham woman pleaded guilty today in connection with her involvement in a scheme to fraudulently obtain COVID-19-related unemployment assistance using stolen identities.
Lilly Nguyen, 24, pleaded guilty to conspiracy to commit wire fraud and aggravated identity theft. U.S. District Court Judge Denise J. Casper scheduled sentencing for Dec. 1, 2021. In April 2021, Nguyen was previously charged in a criminal complaint with an alleged co-conspirator.
The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) created a temporary federal unemployment insurance program called Pandemic Unemployment Assistance. The program is administered by the Massachusetts Department of Unemployment Assistance and provides unemployment insurance benefits for individuals who are not eligible for other types of unemployment benefits (e.g., the self-employed, independent contractors, or gig economy workers).
Nguyen participated in a scheme to submit fraudulent Pandemic Unemployment Assistance claims using the stolen personally identifiable information of others. The investigation connected Nguyen and her alleged co-conspirator to more than $250,000 in unemployment claims between April and December 2020.
The charge of conspiracy to commit wire fraud provides for a sentence of up to 20 years in prison, up to three years of supervised release and a fine of $250,000. The charge of aggravated identity theft provides for a mandatory sentence of two years in prison to be served consecutively to any other sentenced imposed, one year of supervised release and a fine of $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney Nathaniel R. Mendell; Joseph R. Bonavolanta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division; and Nikitas Splagounias, Acting Special Agent in Charge of the U.S. Department of Labor, Office of Inspector General, Office of Investigations, Labor Racketeering and Fraud made the announcement. Special assistance was provided by the Massachusetts Department of Unemployment Assistance. Assistant U.S. Attorney Christopher J. Markham of Mendell’s Securities, Financial & Cyber Fraud Unit is prosecuting 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.
The details contained in the charging documents are allegations. The remaining defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Stonecrest man sentenced to jail for defrauding the USDA COVID-19 relief programRead the Press Release
ATLANTA - Christopher Hayes has been sentenced for defrauding the USDA’s Coronavirus Food Relief Program and attempting to defraud the IRS's COVID-19 relief program.
“The government has provided significant relief for Americans as a result of the COVID-19 pandemic,” said Acting U.S. Attorney Kurt R. Erskine. “Unfortunately, there are those who take advantage of this to defraud these programs. Our office has placed the highest priority on prosecuting those that do so.”
“IRS-Criminal Investigation is committed to investigating fraud against COVID-19 relief programs,” said IRS-Criminal Investigation Special Agent in Charge James E. Dorsey. “Our financial expertise is a key asset to the COVID-19 Fraud Enforcement Task Force. We will continue to use our financial expertise to identify fraud, trace the funds, and bring the criminals to justice.”
“The USDA COVID-19 food assistance programs were meant to keep food on American family’s tables during this unprecedented time,” said Jason Williams, Special Agent in Charge, U.S. Department of Agriculture-Office of Inspector General. “This prosecution should send a strong zero-tolerance message to those opportunistic fraudsters who would take advantage of a national emergency to enrich themselves.”
According to Acting U.S. Attorney Erskine, the charges and other information presented in court: Hayes submitted a false claim to the USDA's Coronavirus Food Assistance Program (CFAP) for the claimed loss of livestock at his commercial farming operation. CFAP provided direct relief to producers who faced price declines and additional marketing costs due to COVID-19. Hayes did not own or operate a commercial farming operation and did not have losses associated with any livestock when he made a claim under CFAP.
In addition, Hayes submitted a fraudulent IRS Form 7200, which, when used legitimately, allows an employer to request an advance payment of employer credits under the Families First Coronavirus Response Act (FFCRA). The FFCRA provides small and midsize employers refundable tax credits that reimburse them, dollar-for-dollar, for the cost of providing paid sick and family leave wages to their employees for leave related to COVID-19. In total, Hayes attempted to obtain over $1.5 million in COVID-19 relief funding.
This is the first completed prosecution for fraud on these two COVID-19 relief programs in the country.
Christopher Hayes, 35, of Stonecrest, Georgia, has been sentenced to two years, six months in prison to be followed by three years of supervised release, and ordered to pay restitution in the amount of $248,739. Hayes was convicted on these charges on May 3, 2021, after he pleaded guilty.
This case is being investigated by the Internal Revenue Service Criminal Investigation and U.S. Department of Agriculture, Office of Inspector General.
Assistant U.S. Attorneys Sarah Klapman and Christopher J. Huber, Deputy Chief of the Complex Frauds Section, are prosecuting 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.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Stockton Woman Pleads Guilty to Unemployment Benefits and Identity-Theft Fraud SchemesRead the Press Release
SACRAMENTO, Calif. — Hopelyn Rhiannon Ausk, 25, of Stockton, pleaded guilty today to mail fraud, bank fraud and aggravated identity theft, Acting U.S. Attorney Phillip A. Talbert announced.
According to court documents, Ausk engaged in two separate fraud schemes that caused significant harm to the U.S. Department of Labor’s Unemployment Insurance (UI) program and identity-theft victims throughout Northern California.
First, between May and September 2020, Ausk perpetrated a fraud scheme that targeted California’s unemployment insurance benefit program administered by the Employment Development Department (EDD). Under the 2020 CARES Act and the Pandemic Unemployment Assistance (PUA) program, EDD was responsible for administering benefits for qualifying residents who could no longer find employment due to the COVID-19 pandemic. In this scheme, Ausk used victims’ personally identifiable information (PII) to submit at least 20 fraudulent claims to EDD. For 12 of these claims, EDD paid out over $160,000 in the form of Bank of America debit cards that were mailed to Ausk’s residence.
Second, between January 2019 and September 2020, Ausk perpetrated a bank fraud scheme that involved stealing U.S. mail and harvesting bankcards, financial information, checks, and PII for use in fraudulent activity. For example, in July 2019, she used a stolen Bank of America debit card to purchase online merchandise from Louis Vuitton for delivery to her residence.
This case is the product of an investigation by the U.S. Postal Inspection Service and the Stockton Police Department. Special Assistant U.S. Attorney Robert J. Artuz is prosecuting the case.
Ausk is scheduled to be sentenced by U.S. District Judge John A. Mendez on Nov. 9, 2021. Ausk faces a maximum statutory penalty of 20 years in prison for mail fraud, 30 years in prison for bank fraud, a mandatory additional sentence of two years in prison and a maximum fine of $250,000 on each count. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which consider a number of variables.
St. Ignatius man sentenced to 15 years in prison for child pornography crimeRead the Press Release
MISSOULA –Justin Douglas Lampke, 47, of St. Ignatius, was sentenced today to 15 years in federal prison, followed by 15 years of supervised release, for transporting child pornography and for failure to register as a sex offender, Acting U.S. Attorney Leif M. Johnson said.
U.S. District Judge Donald W. Molloy presided. Judge Molloy also ordered $3,000 restitution on the child pornography crime and forfeiture of electronic devices seized in the case. Lampke pleaded guilty in October 2020 to failure to register as a sex offender and in March 2021 to transporting child pornography.
Court documents filed by the government state Lampke has several prior sexual abuse convictions beginning in 1992 in the state of Oregon where his victims were as young as five and six years old. While placed on supervised release for those convictions, the defendant violated his parole on multiple occasions. In January 2020, Lampke was caught hiding in Montana under an alias. He was discovered when an Internet Crimes Against Children Task Force detective received multiple National Center for Missing and Exploited Children Cybertips regarding an individual transferring child pornography files via Facebook. Lampke’s real identity was discovered, and he was arrested for the underlying crimes. Child pornography was located on multiple devices seized from his residence, and agents determined Lampke transported or moved child pornography to a USB storage device from another digital device in May 2019.
Lampke absconded from Oregon supervision in March 2017, had been in Montana since approximately March 2017, and had not registered as a sex offender.
Assistant United States Attorney Cyndee L. Peterson prosecuted the case, which was investigated by the Internet Crimes Against Children Task Force, Missoula County Sheriff’s Office and the FBI.
This case was initiated under the Department of Justice’s Project Safe Childhood initiative, which was launched in 2006 to combat the proliferation of technology-facilitated crimes involving the sexual exploitation of children. Through a network of federal, state and local law enforcement agencies and advocacy organizations, Project Safe Childhood attempts to protect children by investigating and prosecuting offenders involved in child sexual exploitation. It is implemented through partnerships including the Montana Internet Crimes Against Children Task Force. The ICAC Task Force Program was created to assist state and local law enforcement agencies by enhancing their investigative response to technology facilitated crimes against children.
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Slidell Man Pleads Guilty to Social Security Fraud of More Than $75,000Read the Press Release
NEW ORLEANS – U.S. Attorney Duane A. Evans announced that MICHAEL R. MATHERNE (“MATHERNE”), age 61, of Slidell, Louisiana pled guilty as charged on July 22, 2021 to an indictment returned by a grand jury on November 6, 2020, for Theft of Federal Funds.
According to the Indictment, the Social Security Administration (“SSA”), an agency or department of the United States of America, operated the Retirement Survivor Insurance Benefit program (“RSI Program”). The purpose of the RSI Program is to provide benefits to certain persons, including widows and widowers, in their retirement.
In or around January 1993, M.F. applied for and began receiving RSI Program benefits. The SSA sent the benefits to M.F. at her address in Slidell, Louisiana in the form of a paper check, which she regularly deposited into her Whitney bank account.
On September 24, 2006, M.F. and MATHERNE were married. In July 2012, MATHERNE created a joint Whitney bank account. On November 3, 2012, M.F. died and MATHERNE never advised the SSA of M.F.’s death.
From December 2012 through March 2019, SSA continued sending checks to M.F., at her home address in Slidell, Louisiana, and MATHERNE continued depositing the checks into the Whitney bank account. From December 2012 through March 2019, MATHERNE received monthly SSA benefits totaling approximately $75,838, which he deposited into the Whitney bank account and used for his living expenses.
MATHERNE entered a guilty plea on July 22, 2021 before U.S. District Judge Barry W. Ashe. He is set to be sentenced November 4, 2021. MATHERNE faces a maximum of 10 years imprisonment, a fine of not more than $250,000, supervised release of at least 3 years, and a mandatory special assessment of $100 as to each count.
The case was investigated by the Social Security Administration, Office of Inspector General. The case is being prosecuted by Assistant U.S. Attorney Carter K. D. Guice, Jr.
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SCDC Inmate Sentenced to 20 Years in Federal Prison for Drug ConspiracyRead the Press Release
Columbia, South Carolina ---- Acting United States Attorney M. Rhett DeHart stated that Kenneth Bryant Evans, a/k/a “Country,” 38, of Aiken County, was sentenced to 20 years in federal prison for conspiracy to possess with the intent to distribute methamphetamine and heroin.
Evidence presented at his change of plea hearing and sentencing established that the Drug Enforcement Administration and the Aiken County Sheriff’s Department initiated an investigation into the narcotics distribution activities of Evans and Eddie Brockington, both state prison inmates. Evans is an inmate in the South Carolina Department of Corrections after pleading guilty to trafficking methamphetamine in 2016 and receiving a 16-year sentence. Brockington is an inmate in the Georgia Department of Corrections who has plead guilty and is awaiting sentencing.
Through controlled purchases and other investigative techniques, agents learned that Evans and Brockington used contraband cellphones, Facebook Messenger and other social media postings to have their co-defendants purchase, transport, and distribute large amounts of methamphetamine and/or heroin. Evans was responsible for distributing more than 97 kilograms of methamphetamine and 3.5 kilograms of heroin throughout South Carolina while incarcerated in SCDC. The drugs were primarily sourced from Atlanta and were transported into South Carolina by various members of his organization and then sold to customers.
United States District Judge J. Michelle Childs, who had accepted Evans’ guilty plea, imposed a sentence of 240 months incarceration, to be followed by 10 years of supervised release, and a special assessment of $100. Evans will begin serving his federal sentence after he is released from the South Carolina Department of Corrections in February 2030.
The case was investigated by agents of the Drug Enforcement Administration and Aiken County Sheriff's Office. Assistant United States Attorney William K. Witherspoon prosecuted the case.
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Rochester Music Teacher Going to Prison for 50 Years After Being Convicted of 74 Charges, Including 61 Counts of Production of Child PornographyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051ROCHESTER, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Philip M. Close, 43, of Rochester, NY, who pleaded guilty to a 74-count indictment, including 61 counts of production of child pornography and 13 counts of possession of material containing child pornography involving prepubescent minors, was sentenced to serve 50 years in prison by U.S. District Judge Charles A. Siragusa.
“As a result of this sentence, this defendant will likely spend most or all of the rest of his life behind bars,” stated U.S. Attorney Kennedy. “Let this case serve as an example to any individual in a position of trust with children—if you seek to exploit children to satisfy your own perverse interests, be prepared to be prosecuted to the fullest extent of the law and potentially to lose your freedom forever.”
Assistant U.S. Attorney Meghan K. McGuire, who handled the case, stated that from 2016 to 2019, the defendant owned the Close School of Music on West Ridge Road in the Town of Parma and provided private music lessons to children of all ages. During that time, Close hid spy cameras throughout the school and secretly recorded the students, parents, and other teachers. Some of those cameras captured videos of the defendant inappropriately touching his students and himself during lessons. Close also placed two spy cameras in the school’s only bathroom: one under the toilet and one hidden in a watercooler facing the toilet. The defendant intentionally positioned these cameras to record the naked genitals of young girls when they stood up from the toilet. Prior to opening the Close School of Music in 2016, the defendant worked at a different music school. Between 2012 and 2016, he also placed a spy camera in the bathroom of that school and intentionally recorded the naked genitals of young girls when they went to the bathroom.
Between 2012 and 2019, Close produced hundreds of videos of child pornography involving 61 identified minor victims. The youngest victim was four years old. While executing search warrants at the Close School of Music, investigators also discovered 13 devices that contained other images and videos of child pornography.
The sentencing is the result of an investigation by the Federal Bureau of Investigation, Child Exploitation Task Force, under the direction of Special Agent-in-Charge Stephen Belongia; the Monroe County Sheriff’s Office, under the direction of Sheriff Todd Baxter; and the Monroe County District Attorney’s Office, under the direction of District Attorney Sandra Doorley.
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Ringleader of Schemes to Steal and Sell Construction Equipment, Recreation Vehicles SentencedRead the Press Release
PROVIDENCE, R.I. – A Cranston man who organized and executed schemes to steal and sell nearly $700,000 worth of excavators, sport boats, jet skis, all-terrain vehicles, and trailers from dealerships and marinas in four New England states was sentenced today to five years in federal prison, announced Acting United States Attorney Richard B. Myrus.
From November 2019 through July 2020, Jose A. Montes, aka Jose Rivera, aka “Tuto”, 37, led one or more individuals under the cover of darkness to break into business and steal three Bobcat excavators, ten jet skis, four boats, eight all-terrain vehicles, and ten trailers. Some of the equipment was subsequently recovered by police; several of the items were hauled to Florida and sold; some items remain unaccounted for.
Montes previously admitted to the court that:
- On October 22, 2019, Montes and a person he recruited forcibly entered a locked Rehoboth, MA, business and stole four jet skis and two double trailers valued at a total of nearly $52,000. Two of the watercrafts were later recovered in Cranston by the Cranston Police.
- On November 18, 2019, Montes and another person cut the lock off a gate leading to a marina in South Kingstown and stole a 22-foot sport boat sitting atop a trailer, with a combined value at $30,000. The boat and trailer were later recovered by law enforcement in Sarasota, FL.
- On December 28, 2019, Montes and two others forcibly entered a marina in Tiverton and stole two sport fishing boats sitting atop trailers, worth a total of nearly $201,000. The boats were towed to a property in Johnston. Montes later removed the engine from one boat in Scituate. The vessel was recovered by police. The second boat was towed to Sarasota, FL, where it was to be sold. It was located and seized by law enforcement.
- Twice on the evening of April 10, 2020, and once the next evening, Montes forcibly entered a Bobcat dealership in Auburn, MA and loaded a Bobcat machine onto a trailer previously reported stolen in Massachusetts. The machines stolen on April 10, 2020, were taken to a property in North Scituate. The machine stolen on April 11, 2020 was brought to a property in Glocester. All three of the machines, valued at a total of $195,000, were recovered by law enforcement.
- On April 12, 2020, Montes and another person forcibly entered a Vernon, CT, business where they pushed an all-terrain vehicle and three-wheeled street motor vehicle onto a trailer. Their attempt to steal the vehicles was interrupted, and the men fled as police responded to the area for an unrelated matter. Undeterred, the two men then traveled to a nearby business where they stole an all-terrain vehicle, a jet ski, and two trailers, valued at a total of $22,700.
- On July 20, 2020, Montes and two men he recruited unlawfully entered a business in Easton, MA, and stole three jet skis and three trailers valued at a total of more than $17,500. One of the trailers was recovered by Easton Police in Providence.
- On July 29, Montes and others stole from a Hampstead, NH, business four all-terrain vehicles, two jet skis, and two trailers, valued in total at $77,098. One of the all-terrain vehicles was located on August 2, 2020 but was subsequently stolen again after being towed by Providence Police. A week later Hampstead Police recovered one of the stolen all-terrain vehicles.
Montes pleaded guilty on May 12, 2021, to eight counts of interstate transportation of stolen property and three counts of conspiracy to commit interstate transportation of stolen property. He was sentenced today by U.S. District Court Judge Mary S. McElroy to 60 months in federal prison to be followed by three years of federal supervised release.
Eight additional defendants have been charged in this matter.
The cases are being prosecuted by Assistant U.S. Attorneys William J. Ferland and Ly T. Chin.
The investigation was launched by the Johnston and North Providence Police Departments, and later joined by the FBI Safe Streets Task Force. The investigation merged with a parallel investigation being conducted by Rhode Island and Connecticut State Police, and the Easton, Mass., and the Hampstead, N.H., Police Departments.
Acting United States Attorney Myrus thanks the Tiverton, South Kingstown, Scituate, Cranston and Providence, R.I., and Auburn, Mass., Police Departments and the Manatee County Sheriff’s Office in Sarasota, FL, for their assistance in the investigations.
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Previously Convicted Sex Offender Sentenced to 20 Years in Federal Prison for Distribution of Child PornographyRead the Press Release
Baltimore, Maryland - U.S. District Judge Richard D. Bennett sentenced Christopher Russell Fox, age 42, of Brooklyn, Maryland, today to 20 years in federal prison, followed by lifetime supervised release, for distribution of child pornography. Judge Bennett also ordered that Fox must continue to register as a sex offender in the place where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA). Fox is already a registered sex offender, previously convicted of a third-degree sex offense in 2016, in Howard County Circuit Court.
The sentence was announced by Acting United States Attorney for the District of Maryland Jonathan F. Lenzner and Special Agent in Charge Thomas J. Sobocinski of the Federal Bureau of Investigation, Baltimore Field Office.
According to his guilty plea, between March and May of 2018, a technology company sent numerous CyberTip Reports regarding child pornography incidents occurring on its video conference platform. Files submitted with the reports depicted prepubescent males engaged in sexually explicit conduct.
As detailed in his plea agreement, investigation revealed that Fox repeatedly used a video conferencing platform to pose as a minor male, in order to communicate with other users. Fox routinely sought out minor males on the video conferencing platform, engaged them in sexual conversation, asked them to trade sexually explicit images and videos, and asked them to stream live images. While he was on probation for his 2016 sex offense conviction, Fox used three separate accounts on the video conferencing platform in order to trade images and videos of minor males engaged in sex acts on at least eleven occasions between December 10, 2017 and May 19, 2018. For example, on March 24, 2018, Fox posed as an 8th grade male and engaged in sexually explicit conversation with a user who stated he was in the 10th grade. During the conversation Fox sent the user a video of three prepubescent males engaging in sexual acts.
On May 10, 2019, investigators executed a federal search warrant at Fox’s residence and seized digital items including Fox’s computer and a mini thumb drive. A forensic review of those items revealed that Fox possessed over 158 images of child pornography on the digital devices. These images, along with the videos Fox traded online, demonstrate that Fox distributed, received, and possessed over 600 images of child pornography.
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 Attorney’s 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.justice.gov/psc. For more information about Internet safety education, please visit www.justice.gov/psc and click on the "Resources" tab on the left of the page.
Acting United States Attorney Jonathan F. Lenzner commended the FBI for its work in the investigation. Mr. Lenzner thanked Assistant U.S. Attorneys Christine L. Duey and Matthew Maddox, who prosecuted the federal case.
For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit www.justice.gov/usao-md/project-safe-childhood and https://www.justice.gov/usao-md/community-outreach.
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Pittsburgh Man Sentenced to 7 Years for Distributing Heroin and Fentanyl to Canonsburg Resident who Died of an OverdoseRead the Press Release
PITTSBURGH, PA - A former resident of Pittsburgh, PA, pleaded guilty and was sentenced in federal court to serve 84 months of imprisonment for a violation of the federal narcotics laws, Acting United States Attorney Stephen R. Kaufman announced today.
William Jamar Saunders, 31, formerly of Clairtonica Street, pleaded guilty to distributing a quantity of heroin and fentanyl on August 21, 2018, before United States District Judge Cathy Bissoon. In connection with the guilty plea, the court was advised that Saunders distributed a quantity of heroin and fentanyl to agents working with the Drug Enforcement Administration and the Federal Bureau of Investigation, who began investigating Saunders following a fatal overdose on June 13, 2018, in Canonsburg, Washington County, PA. As part of the guilty plea, Saunders admitted that he distributed a mixture containing heroin, fentanyl, and acetyl fentanyl, packaged in stamp bags called “Super Mario,” which resulted in the death of a Canonsburg resident.
Following his 84-month term of imprisonment, Saunders will be under the supervision of the United States Probation Office for six years. The Court directed Saunders to pay restitution to the victim’s family for funeral expenses.
Assistant United States Attorney Jerome A. Moschetta prosecuted this case on behalf of the government.
Acting United States Attorney Stephen R. Kaufman commended the Drug Enforcement Administration and the Federal Bureau of Investigation, which conducted the investigation in partnership with the Canonsburg Borough Police Department and the Washington County District Attorney’s Office, for the successful prosecution of Saunders.
Pittsburgh Felon Indicted for Violating Federal Drug and Firearms LawsRead the Press Release
PITTSBURGH, PA - A resident of Pittsburgh, Pennsylvania, has been indicted by a federal grand jury in Pittsburgh on charges of possession with intent to distribute a controlled substance, possession of a firearm in furtherance of a drug trafficking crime, and possession of a firearm and ammunition by a convicted felon, Acting United States Attorney Stephen R. Kaufman announced today.
The three-count Indictment named Eugene Key, age 26, formerly of the Elliott neighborhood of Pittsburgh, as the sole defendant.
According to the Indictment, Key was arrested on July 2, 2021, in possession of 100 grams or more of a mixture of heroin and fentanyl and two handguns, one of which had an obliterated serial number. Federal law prohibits an individual who has been convicted of a felony from possessing a firearm or ammunition.
The law provides for a maximum total sentence of not less than 10 years to a maximum of life in prison, a fine not to exceed $8,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Jonathan D. Lusty is prosecuting this case on behalf of the government.
The Bureau of Alcohol, Tobacco, Firearms, and Explosives, and the Pittsburgh Bureau of Police conducted a joint investigation leading to the Indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Peoria Man Sentenced to 240 Months for Attempted Enticement of a MinorRead the Press Release
Peoria, Ill. – A Peoria, Ill. man, Jimmy Deffenbaugh, 71, has been sentenced to 240 months in prison, to be followed by lifetime supervised release, for attempted enticement of a minor.
According to court documents in April 2020, Deffenbaugh, using a cellular device, responded to a solicitation ad in Peoria, Ill. and did knowingly attempt to persuade, induce, entice and coerce an individual who had not attained the age of 18 years to engage in sexual activity.
Deffenbaugh was arrested on April 9, 2020, following an investigation by the Federal Bureau of Investigation and the Illinois State Police. Deffenbaugh has remained in the custody of the U.S. Marshals since that time.
On March 18, 2021, Deffenbaugh entered a plea of guilty to one count of attempted enticement of a minor.
Assistant U.S. Attorneys Paul B. Morris and Douglas F. McMeyer represented the government in the prosecution and sentencing.
The case was brought as part of Project Safe Childhood, a nationwide initiative by the Department of Justice to combat the 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, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Navajo man sentenced to twelve years in prison for sexual abuse of a child in Indian CountryRead the Press Release
ALBUQUERQUE, N.M. – Copey Ferlin Henderson, 27, an enrolled member of the Navajo Nation, was sentenced in federal court on Aug. 2 to twelve years in prison following a conviction for sexually abusing a minor in Indian Country. Henderson pleaded guilty on Nov. 30, 2020.
According to the plea agreement and other court records, on or about May 16, 2019, Henderson texted the victim and the two met in Ramah, New Mexico, on the Ramah Navajo Nation in Cibola County. After drinking alcohol together, Henderson took the victim to a tent where he was staying near Yucca Village. Henderson admitted to knowingly engaging in a sexual act with the victim, who at the time of the offense was older than 12 but younger than 16.
Henderson will be required to register as a sex offender and will be subject to supervised release for 15 years upon his release from prison.
The Ramah Navajo Police Department investigated this case. Assistant U.S. Attorney Novaline D. Wilson prosecuted the case.
Monongalia County man sentenced for his role in a drug trafficking operationRead the Press Release
CLARKSBURG, WEST VIRGINIA – Andrew Benson, of Morgantown, West Virginia, was sentenced today to 16 months of incarceration for his role in a drug trafficking conspiracy, Acting U.S. Attorney Randolph J. Bernard announced.
Benson, 35, pled guilty in April 2021 to one count of “Conspiracy to Distribute Heroin and Cocaine Base.” Benson admitted to working with others to distribute the drugs from March 2018 to September 2020 in Monongalia County and elsewhere.
Assistant U.S. Attorney Zelda E. Wesley prosecuted the case on behalf of the government. The Drug Enforcement Administration, the Mon Metro Drug & Violent Crimes Task Force, a HIDTA-funded initiative, and the Monongalia County Sheriff’s Office investigated.
This prosecution is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
Senior U.S. District Judge Irene M. Keeley presided.
Related press release: https://www.justice.gov/usao-ndwv/pr/seventeen-people-charged-heroin-and-crack-cocaine-distribution-operation
Mississippi Man Pleads Guilty to 4 Business RobberiesRead the Press Release
Memphis, TN – Jacobly Whitehead, 27, of Greenwood, Mississippi, has pleaded guilty to Hobbs Act robbery and brandishing a firearm during a crime of violence. Acting U.S. Attorney Joseph C. Murphy Jr., announced the plea today.
According to information presented in court, on February 10, 2020, Whitehead, an unknown suspect at the time, entered Cricket Wireless on S. Third Street at approximately 5:50 p.m., pointed a black handgun at employees, and demanded money from the cash registers. Taking approximately $1,700, he then fled the scene.
On February 22, 2020, Whitehead, an unknown suspect at the time, entered the Metro PCS on S. Third Street at approximately 6:30 p.m., where he struck an employee with a black handgun and demanded money from the cash registers. He stole a firearm from an employee and approximately $2,000 and fled on foot. The suspect matched the description of the suspect of the robbery on February 10, 2020. The businesses were located within walking distance.
On March 17, 2020, Whitehead, an unknown suspect at the time, entered the Cricket Wireless on S. Third Street at approximately 9:30 a.m., pointed a black handgun at employees, and demanded cash from the register. While leaving the store, Whitehead struck an employee in the head with his pistol. He fled in a red Chevrolet Equinox which had several unique markings and visible features.
On March 31, 2020, Whitehead, an unknown suspect at the time, entered the Metro PCS on E. Shelby Drive at approximately 4:00 p.m., wearing a facemask and the same clothing as the suspect in the March 17, 2020 robbery. He pointed a black handgun at the employees, took approximately $800 from the register, and fled the scene in a red Chevrolet Equinox, with several similar unique markings. Prior to the robbery, the suspect entered the Dollar General behind the Metro PCS with his face uncovered and was captured on surveillance video.
Officers with MPD's Safe Streets Task Force located a possible suspect vehicle owned by a woman who lived on Court Street. This address was within walking distance of the first two robberies. Investigators researched the woman’s husband, identified as Jacolby Whitehead who also matched the description given by many of the robbery victims.
Surveillance conducted at their residence showed Whitehead driving the red Equinox. Further, law enforcement executed a search warrant for the vehicle and the residence. They recovered clothing similar to that described by the witnesses and seen on surveillance video. Whitehead was Mirandized and admitted to all four of the robberies.
Whitehead pled guilty on July 21, 2021.
Sentencing is scheduled on October 28, 2021, before U.S. District Judge Sheryl H. Lipman, where Whitehead faces a mandatory minimum sentence of 7 years on each of the firearms counts and up to 20 years on the robbery counts. There is no parole in the federal system.
This case was investigated by the Memphis Police Department and the FBI Safe Streets Task Force.
Special Assistant U.S. Attorney Samuel D. Winnig is prosecuting this case on behalf of the government. SAUSA Winnig is currently assigned from the Shelby County District Attorney General’s Office for the purpose of prosecuting violent crimes and firearms offenses in federal court.
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Minton Man Sentenced to Prison for Distributing Child PornographyRead the Press Release
DAVENPORT – On Wednesday, July 28, 2021, a Minton man was sentenced by United States District Court Chief Judge John A. Jarvey to 80 months in federal prison for distributing child pornography.
According to court documents, Joshua Emil Sullivan, age 46, admitted to distributing child pornography over the internet. After Sullivan’s term of imprisonment, he will be required to serve a term of supervised release of five years and register as a sex offender.
Acting United States Attorney Richard D. Westphal of the Southern District of Iowa made the announcement. The case was investigated by the Federal Bureau of Investigation.
This case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa as part of the U.S. Department of Justice’s “Project Safe Childhood” initiative, which was started in 2006 as a nation-wide effort to combine law enforcement investigations and prosecutions, community action, and public awareness to reduce the incidence of sexual exploitation of children. Any persons having knowledge of a child being sexually abused are encouraged to call the Iowa Sexual Abuse Hotline at 1-800-284-7821.
Manhattan U.S. Attorney Announces Agreement with Bermudian Bank to Resolve Criminal Tax InvestigationRead the Press Release
Audrey Strauss, the United States Attorney for the Southern District of New York, Stuart M. Goldberg, Acting Deputy Assistant Attorney General of the Justice Department’s Tax Division, and James C. Lee, Chief of the Internal Revenue Service, Criminal Investigation (“IRS-CI”), announced today that Bank of N.T. Butterfield & Son Limited (“BUTTERFIELD”) entered into a non-prosecution agreement (“NPA”) with the U.S. Attorney’s Office and agreed to pay $5.6 million to the United States for assisting U.S. taxpayer-clients in opening and maintaining undeclared foreign bank accounts from 2001 through 2013. The NPA was based on BUTTERFIELD’s extraordinary cooperation, including its efforts in providing 386 client files for non-compliant U.S. taxpayer-clients, and provides that BUTTERFIELD will not be criminally prosecuted. The NPA requires BUTTERFIELD to forfeit $4.896 million to the United States, representing certain fees that it earned by assisting its U.S. taxpayer-clients in opening and maintaining these undeclared accounts, and to pay $704,000 in restitution to the IRS, representing the approximate unpaid taxes arising from the tax evasion by BUTTERFIELD’s U.S. taxpayer-clients.
Manhattan U.S. Attorney Audrey Strauss said: “Butterfield admits to helping its clients conceal their ownership of foreign bank accounts to avoid their U.S. tax obligations. Butterfield allowed its U.S. clients to use sham entities that assisted those U.S. clients in funneling money between U.S.- and Cayman Islands-based accounts. The resolution of this matter through a non-prosecution agreement, along with forfeiture and restitution, reflects Butterfield’s cooperation in our investigation and demonstrates that cooperation, including assistance in providing U.S. taxpayer client files, has tangible benefits. We will continue to pursue financial services firms around the world that help their clients evade U.S. taxes.”
Acting Deputy Assistant Attorney General Stuart M. Goldberg said: “As part of the resolution announced today, Butterfield has facilitated the production of approximately 386 unredacted client files. Taxpayers contemplating hiding money offshore and those who would facilitate their fraud should take note – nothing remains hidden forever.”
IRS-CI Chief James C. Lee said: “As a result of the successful resolution of this investigation, Butterfield has agreed to turn over account files relating to U.S. taxpayer-clients who maintained undeclared assets overseas. This agreement marks yet another significant step forward in combating offshore tax evasion. Anyone who is hiding money or assets offshore with the intent of committing tax evasion will be found and prosecuted. It’s not a matter of ‘if,’ it’s a matter of ‘when.’”
As part of the NPA, BUTTERFIELD admitted various facts concerning its wrongful conduct and the remedial measures that it took to cease that conduct. Specifically, BUTTERFIELD admitted that it knew or should have known certain U.S. taxpayers were using their BUTTERFIELD accounts to evade their U.S. tax obligations, in violation of U.S. law. BUTTERFIELD acknowledged that it helped certain U.S. taxpayer-clients conceal from the IRS their beneficial ownership of undeclared assets maintained in foreign bank accounts by: (i) maintaining undeclared accounts for U.S. taxpayer-clients that were held by sham entities – structures that had no legitimate business purpose – even though Bank personnel knew, or should have known, that the entities were being used to conceal the identities of the true account owners; and (ii) opening accounts and facilitating the transfer of funds for U.S. taxpayer-clients despite obvious red flags that the U.S. clients were using the accounts to maintain undeclared assets or commit tax evasion.
The NPA recognizes that, in 2013, BUTTERFIELD implemented a series of remedial measures to stop assisting U.S. taxpayers evading federal income taxes. The NPA further recognizes BUTTERFIELD’s cooperation, including its efforts to facilitate the production of approximately 386 client files for non-compliant U.S. taxpayers, which included the identities of those U.S. taxpayers.
As part of the NPA, BUTTERFIELD has agreed to forfeit $4.896 million to the United States, representing the gross revenues from services that it provided to U.S. taxpayers with undeclared foreign bank accounts from 2001 through 2013. In connection with this forfeiture, BUTTERFIELD has agreed not to contest a civil forfeiture action filed by the United States.
The NPA requires BUTTERFIELD to continue to cooperate with the United States for at least three years from the date of the agreement. In the event that BUTTERFIELD violates the NPA, the U.S. Attorney’s Office may prosecute BUTTERFIELD.
Ms. Strauss thanked the IRS for its outstanding work in the investigation of this matter and thanked the Tax Division of the Department of Justice for its assistance in the investigation.
This investigation is being overseen by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorney Kiersten A. Fletcher is in charge of the matter.
Man found guilty of sexual abuse in incident on Kirtland Air Force BaseRead the Press Release
ALBUQUERQUE, N.M. – A federal jury on July 30 found Zechariah Freemen, 45, guilty of sexual abuse. Freemen will remain in custody pending sentencing, which has not been scheduled.
Freeman was indicted on Jan. 9, 2020. According to the indictment and other court records, on the evening of June 15, 2019, Freeman, a civilian, attended a gathering at a house on Kirtland Air Force Base in Albuquerque, where the victim was also present. In the early morning hours of June 16, 2019, Freeman sexually abused the victim while she was physically incapable of declining or communicating her unwillingness to participate.
Freeman faces up to life in prison, up to five years of supervised released, up to a $250,000 fine and restitution. Freeman will be required to register as a sex offender.
The United States Air Force Office of Special Investigations investigated this case with assistance from the Albuquerque Police Department and the U.S. Marshals Service. Assistant U.S. Attorneys Letitia Simms and Sarah Mease are prosecuting the case.
Man Sentenced for COVID-19 Relief FraudRead the Press Release
Miami, Florida -- A Florida man has been sentenced to 33 months in prison for fraudulently seeking over $7,263,564 in Paycheck Protection Program (PPP) loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
Andre Clark, 48, of Miramar, pleaded guilty to one count of conspiracy to commit wire fraud on May 14. Clark admitted that he obtained a PPP loan of $488,565 on behalf of his company, Top Choice LLC, based on falsified information and documents that a co-conspirator, James Stote, submitted on his behalf. Clark also admitted to recruiting friends and associates whom he referred to Stote for the purpose of submitting additional fraudulent PPP loan applications, sometimes in exchange for kickbacks. Clark admitted to seeking $6,774,999 in fraudulent PPP loans through other conspirators that he referred to the scheme. In addition to the prison sentence, Clark was ordered to pay $2,975,086 in restitution.
Additionally, two other co-conspirators were recently sentenced for their roles in the scheme. On July 29, Tonye Johnson, 29, of Philadelphia, Pennsylvania, was sentenced to 18 months in prison. Johnson admitted to obtaining a fraudulent PPP loan of $389,627 for his company, Synergy Towing & Transport LLC, based on falsified information and documents. And, on July 13, Tiara Walker, 38, of Miami Gardens, Florida, was sentenced to 12 months and a day in prison. Walker admitted to obtaining a fraudulent PPP loan of $258,575 for her company, Utilization Review Pros LLC, based on falsified information and documents. Both Johnson and Walker falsely inflated the number of employees and monthly payroll for their companies, and they worked with Stote and other co-conspirators to obtain their fraudulent loans.
James Stote was charged by complaint on June 24, 2020, with wire fraud, bank fraud, and conspiracy to commit wire fraud, and his case remains pending. A complaint is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Acting U.S. Attorney Juan Antonio Gonzalez of the Southern District of Florida; Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division; Special Agent in Charge Michael J. De Palma of the IRS Criminal Investigation (IRS-CI) Miami Field Office; Special Agent in Charge George L. Piro of the FBI’s Miami Field Office; and Special Agent in Charge Amaleka McCall-Brathwaite of the SBA’s Office of Inspector General (SBA-OIG) Eastern Region made the announcement.
The IRS-CI, FBI, and SBA-OIG investigated the cases.
Assistant U.S. Attorneys David Turken and David Snider of the U.S. Attorney’s Office for the Southern District of Florida and Trial Attorney Philip Trout of the Criminal Division’s Fraud Section prosecuted the cases.
In May, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
You may find related court documents and information 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 numbers 21-cr-60029, 21-cr-60017, and 20-cr-60159.
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Man Facing Federal Charge for Conspiracy to Commit Wire Fraud in Relation to an Elder Fraud SchemeRead the Press Release
Baltimore, Maryland – A federal grand jury has returned an indictment charging Michael Odell Anderson, age 63, of Dunn Lorring, Virginia, for the federal charge of conspiracy to commit wire fraud in relation to an elder fraud scam.
The indictment was announced by Acting United States Attorney for the District of Maryland Jonathan F. Lenzner and Special Agent in Charge Thomas J. Sobocinski of the Federal Bureau of Investigation, Baltimore Field Office.
According to the one-count indictment, from April 2020 to December 2020, Anderson conspired with others to defraud elderly victims by posing as a bail bondsman, lawyer, or relative on phone calls and convincing the victim to send money for the purported legal expenses of a loved one, generally a grandchild. Further, the indictment alleges that in addition to requesting funds by phone, Anderson and other conspirators posed as bail bondsmen or couriers and received cash directly from the victims. As part of the conspiracy, Anderson recruited additional participants to join the conspiracy and assist in retrieving cash from the victims. Anderson allegedly required the recruited conspirators to pay him a percentage of their earnings from the fraud scheme. Additionally, conspirators allegedly told the victims the money they sent would be returned to them at a later date.
The indictment also alleges that if victims sent cash as directed by conspirators, conspirators fabricated additional reasons for them to send more money. For example, conspirators allegedly claimed the additional funds were necessary for their grandchild’s legal expenses, bail costs, fines, or to pay damages. Conspiracy members allegedly obtained tens of thousands of dollars from the retirement savings of victims.
As stated in the indictment, the conspiracy directed at least 49 different victims to pay at least $800,000 through materially false pretenses, representation, and promises.
If convicted, Anderson faces a maximum sentence of 20 years in federal prison for conspiracy to commit wire fraud. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
The Department of Justice runs the National Elder Fraud Hotline at 1-833-FRAUD-11 (1-833-372-8311), has an interactive tool for elders who have been financially exploited to help determine to which agency they should report their incident, and also has a senior scam alert website. Victims are encouraged to file a complaint online with the FBI’s Internet Crime Complaint Center at this website or by calling 1-800-225-5324. Elder fraud complaints may be filed with the FTC at www.ftccomplaintassistant.gov or at 877-FTC-HELP.
Acting United States Attorney Jonathan F. Lenzner commended the FBI for its work in the investigation. Mr. Lenzner thanked Assistant U.S. Attorneys Sean R. Delaney and Matthew J. Maddox, who are prosecuting the federal case.
For more information on the Maryland U.S. Attorney’s Office, its priorities, and resources available to help the community, please visit https://www.justice.gov/usao-md/community-outreach.
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Los Lunas man charged with federal firearms violationRead the Press Release
ALBUQUERQUE, N.M. – Russell Wheeler, 49, of Los Lunas, New Mexico, appeared in federal court today for a detention hearing, charged with being a felon in possession of a firearm and ammunition. Wheeler will remain in custody pending trial.
According to a criminal complaint and other court records, in Los Lunas on May 22, Wheeler and another man allegedly argued briefly when Wheeler shot the victim in the face with a revolver. Wheeler allegedly fled the scene on a motorcycle, leaving the victim bleeding from his face and mouth. The victim was taken to an urgent care clinic and later to the University of New Mexico Hospital for treatment.
Wheeler was convicted of possession of a controlled substance in 2005 and aggravated fleeing from law enforcement in 2007, both felonies. As a previously convicted felon, Wheeler cannot legally possess firearms or ammunition.
A complaint is only an allegation. A defendant is presumed innocent unless and until proven guilty. If convicted, Wheeler faces up to 10 years in prison
The FBI Violent Crime Task Force investigated this case with assistance from the Valencia County Sheriff’s Office and New Mexico State Police. Assistant United States Attorneys Jaymie L. Roybal and Alexander Uballez are prosecuting the case.
Local man who attempted to smuggle 13,000 rounds of ammunition sent to prisonRead the Press Release
LAREDO, Texas – A 40-year old Laredo man has been ordered to federal prison following his conviction for attempting to smuggle ammunition out of the United States, announced Acting U.S. Attorney Jennifer B. Lowery.
Obed Rafael Cuevas-Serratos pleaded guilty Oct. 28, 2020.
Today, U.S. District Judge Nelva Gonzales Ramos ordered him to serve a 30-month sentence to be immediately followed by three years of supervised release.
“One of our top enforcement priorities is preventing ammunition from falling into the hands of those who might seek to harm innocent people,” said Deputy Special Agent in Charge Timothy Tubbs of Homeland Security Investigations (HSI). “HSI will continue to work closely with our law enforcement partners to combat this threat and hold the perpetrators accountable for putting our communities at risk.”
Cuevas-Serratos admitted that on Aug. 24, 2020, he purchased 13,000 rounds of 7.62x39 millimeter ammunition in San Antonio. The following day, his car attempted to cross into Mexico.
As part of his plea, he admitted he hired a juvenile to cross the ammunition into Mexico for him.
Cuevas-Serratos was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.
HSI conducted the investigation with the assistance of Customs and Border Protection. Assistant U.S. Attorneys Michael Makens and April Ayers-Perez prosecuted the case.
Local Felon Charged with Illegally Possessing 3 FirearmsRead the Press Release
PITTSBURGH, PA - A resident of Pittsburgh, Pennsylvania, has been indicted by a federal grand jury in Pittsburgh on a charge of possession of a firearm and ammunition by a convicted felon, Acting United States Attorney Stephen R. Kaufman announced today.
The one-count Indictment named Dasean Lee, age 28, formerly of the 800 block of Citadel Street in Pittsburgh, as the sole defendant.
According to the Indictment, on February 11, 2021, Lee was arrested subsequent to a search warrant at his residence in which three firearms, including a stolen handgun, were recovered. Lee, who is a convicted felon, admitted the weapons were his.
The law provides for a maximum total sentence of not more than 10 years in prison, a fine of up to $250,000 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Jonathan D. Lusty is prosecuting this case on behalf of the government.
The Bureau of Alcohol, Tobacco, Firearms, and Explosives, and the Pittsburgh Bureau of Police conducted a joint investigation leading to the Indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Leader of Transnational Money-Laundering Network Pleads Guilty to Aiding Drug-Trafficking Organizations, While Co-Conspirator is SentencedRead the Press Release
A Chinese national and naturalized U.S. citizen pleaded guilty yesterday to his involvement in a conspiracy to launder at least $30 million in drug proceeds on behalf of foreign drug-trafficking organizations. Another Chinese national was sentenced to seven years in prison today for his role in the same conspiracy.
According to court documents, Xizhi Li, 48, played a leadership role within a years-long conspiracy to use a foreign casino, foreign and domestic front companies, foreign and domestic bank accounts, false passports and other false identification documents to launder money on behalf of transnational drug-trafficking organizations, whose main drug-trafficking activities involved cocaine. The defendant dealt directly with members of drug-trafficking organizations or their representatives to obtain and service “contracts” to move their drug proceeds. Once the defendant and his co-conspirators obtained a “contract” to launder drug proceeds, they would engage in financial transactions that were designed to conceal the illicit source of the original funds, in return for the payment of commissions.
“The defendants laundered millions of dollars on behalf of drug traffickers through the global financial system in a manner that concealed the source and nature of the illicit funds,” said Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division. “Global money-laundering networks enable drug cartels to profit from their deadly trade, and yesterday’s guilty plea and today’s sentence underscore the Justice Department’s commitment to dismantling the financial infrastructure of transnational criminal organizations to take the profit out of crime. This plea and sentence would not have been possible without the tireless efforts of our federal law enforcement partners and the United States Attorney’s Office for the Eastern District of Virginia.”
“This prosecution demonstrates the enormous value of collaborating with agencies across the government and with our international partners to dismantle and hold accountable transnational criminal organizations that pose a significant danger to the public,” said Acting U.S. Attorney Raj Parekh for the Eastern District of Virginia. “The far-reaching conspiracy in this case involved the laundering of millions of dollars of illegal proceeds on behalf of transnational drug-trafficking organizations through the use of a casino, front companies, foreign and domestic bank accounts, false identification documents, and bulk cash smuggling. We greatly appreciate the essential and innumerable contributions from our partner agencies, all of whom worked closely together to thoroughly follow the facts and evidence that led to the unraveling of this multimillion-dollar money-laundering scheme.”
“DEA’s mission is to make our communities safer and healthier, which means bringing to justice the most dangerous individuals and organizations that traffic drugs in the United States and around the world,” said Administrator Anne Milgram of the Drug Enforcement Administration. “Through the collective efforts of the DEA and our law enforcement partners, we relentlessly pursue individuals, like the one here, who allegedly laundered more than $30 million in drug profits.”
“The successful outcome of this complex, multi-year investigation is owed to dogged determination by the dedicated men and women of the Drug Enforcement Administration, working closely with our federal law enforcement partners,” said Special Agent in Charge J. Todd Scott of DEA’s Louisville Division. “We will continue to be relentless in our efforts to stop transnational criminal organizations from operating within our borders, and we will use every tool available in our mission to protect the American people.”
Co-defendant Tao Liu, 46, of Hong Kong, helped to execute the money laundering scheme. At times, Liu accepted bulk drug cash on behalf of Xizhi Li, which he later deposited into bank accounts that Li provided. Additionally, Liu was the target of a months-long undercover investigation during which he attempted to bribe what he believed was a corrupt U.S. Department of State official to obtain U.S. passports for individuals, including Liu himself, who were not otherwise entitled to use or possess such documents. This purportedly corrupt official was actually an undercover DEA agent. Liu agreed to pay $150,000 per passport as part of this scheme.
Li pleaded guilty to conspiracy to launder money. He is scheduled to be sentenced on Oct. 26 and faces a maximum penalty of 20 years in prison as well as a $10-million forfeiture money judgment. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. Liu pleaded guilty to his role in the conspiracy and a separate bribery charge on April 14 and was sentenced today to seven years in prison.
On April 14, co-defendants Jiayu Chen, 46, of Brooklyn, New York, and Jingyuan Li, 49, of San Gabriel, California, pleaded guilty to their roles in the conspiracy. On July 20, Chen was sentenced to 60 months’ imprisonment and ordered to forfeit $2.8 million dollars.
Additionally, on June 16, Eric Yong Woo, 43, of Alhambra, California, also pleaded guilty to his role in the money-laundering conspiracy. He is scheduled to be sentenced on Sept. 21 and faces a maximum penalty of 20 years in prison.
Finally, Jianxing Chen, 40, of Belize, was charged in the superseding indictment for his alleged involvement in this money-laundering and drug-trafficking conspiracy. He is pending extradition following his arrest in Lima, Peru. Chen was captured with significant assistance from The International Criminal Police Organization (INTERPOL).
The DEA’s Louisville Division and the DEA’s Special Operations Division–Bilateral Investigations Unit are investigating this case, with assistance from the DEA’s Office of Special Intelligence, Document and Media Exploitation Unit and the DEA’s offices in New York, Chicago, Los Angeles, Houston, Omaha, Atlanta, Newark, Portland, Dallas, Mexico City, Merida (Mexico), Guatemala City, Belmopan (Belize), Beijing, Hong Kong, Jakarta (Indonesia), Manila (Philippines), Tokyo, Seoul, Bangkok, Lima (Peru), and Canberra (Australia). The U.S. Department of State’s Diplomatic Security Service (DSS), U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), U.S. Postal Inspection Service, Interpol, and U.S. Customs and Border Protection National Targeting Center (CBP – National Targeting Center) were partners in the investigation of this case.
Assistant U.S. Attorneys David A. Peters and Michael P. Ben’Ary and Trial Attorneys Kerry Blackburn, Mary K. Daly, and Stephen A. Sola of the Justice Department’s Money Laundering and Asset Recovery Section are prosecuting the case.
The Justice Department’s Office of International Affairs provided significant assistance. The Australian Criminal Intelligence Commission, the Australian Federal Police, the Australia Department of Home Affairs, the Mexican Federal Police, the Guatemalan National Civil Police and the New Zealand Police also provided significant assistance.
This prosecution is part of two Organized Crime Drug Enforcement Task Force (OCDETF) investigations. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
Leader of Transnational Money Laundering Network Pleads Guilty to Aiding Drug Trafficking Organizations, While Co-Conspirator is SentencedRead the Press Release
ALEXANDRIA, Va. – A Chinese national and naturalized U.S. citizen pleaded guilty yesterday to his involvement in a conspiracy to launder at least $30 million in drug proceeds on behalf of foreign drug trafficking organizations. Another Chinese national was sentenced to 7 years in prison today for his role in the same conspiracy.
According to court documents, Xizhi Li, 48, played a leadership role within a years’ long conspiracy to use a foreign casino, foreign and domestic front companies, foreign and domestic bank accounts, false passports and other false identification documents, and bulk cash smuggling to launder money on behalf of transnational drug trafficking organizations, whose main drug trafficking activities involved cocaine. The defendant dealt directly with members of drug trafficking organizations or their representatives to obtain and service “contracts” to move their drug proceeds. Once the defendant and his co-conspirators obtained a “contract” to launder drug proceeds, they would engage in financial transactions that were designed to conceal the illicit source of the original funds, in return for the payment of commissions.
“This prosecution demonstrates the enormous value of collaborating with agencies across the government and with our international partners to dismantle and hold accountable transnational criminal organizations that pose a significant danger to the public,” said Raj Parekh, Acting U.S. Attorney for the Eastern District of Virginia. “The far-reaching conspiracy in this case involved the laundering of millions of dollars of illegal proceeds on behalf of transnational drug trafficking organizations through the use of a casinos, front companies, foreign and domestic bank accounts, false identification documents, and bulk cash smuggling. We greatly appreciate the essential and innumerable contributions from our partner agencies, all of whom worked closely together to thoroughly follow the facts and evidence that led to the unraveling of this multimillion-dollar money laundering scheme.”
“The defendant laundered millions of dollars on behalf of drug traffickers through the global financial system in a manner that concealed the source and nature of the illicit funds,” said Assistant Attorney General Kenneth A. Polite Jr. “Global money laundering networks enable drug cartels to profit from their deadly trade, and yesterday’s guilty plea and today’s sentence underscores the Justice Department’s commitment to dismantling the financial infrastructure of transnational criminal organizations to take the profit out of crime. This plea and sentence would not have been possible without the tireless efforts of our federal law enforcement partners and the United States Attorney’s Office for the Eastern District of Virginia.”
“DEA’s mission is to make our communities safer and healthier, which means bringing to justice the most dangerous individuals and organizations that traffic drugs in the United States and around the world,” said Anne Milgram, Drug Enforcement Administration Administrator. “Through the collective efforts of the DEA and our law enforcement partners, we relentlessly pursue individuals, like the one here, who admitted to laundering more than $30 million in drug profits.”
Co-defendant, Tao Liu, 46, of Hong Kong, helped to execute the money laundering scheme. At times, Liu accepted bulk drug cash on behalf of Xizhi Li, which he later deposited into bank accounts that Li provided. Additionally, Liu was the target of a months-long undercover investigation during which he attempted to bribe what he believed was a corrupt U.S. Department of State official to obtain U.S. passports for individuals, including Liu himself, who were not otherwise entitled to use or possess such documents. This purportedly corrupt official was actually an undercover DEA agent. Liu agreed to pay $150,000 per passport as part of this scheme.
Li pleaded guilty to conspiracy to launder money. He is scheduled to be sentenced on October 26 and faces a maximum penalty of 20 years in prison as well as a $10 million forfeiture money judgment. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. Liu pleaded guilty to his role in the conspiracy and a separate bribery charge on April 14 and was sentenced today to 7 years in prison.
On April 14, co-defendants Jiayu Chen, 46, of Brooklyn, New York, and Jingyuan Li, 49, of San Gabriel, California, pleaded guilty to their roles in the conspiracy. On July 20, Chen was sentenced to 60 months’ imprisonment and ordered to forfeit $2.8 million dollars.
Additionally, on June 16, Eric Yong Woo, 43, of Alhambra, California, also pleaded guilty to his role in the money laundering conspiracy. He is scheduled to be sentenced on September 21 and faces a maximum penalty of 20 years in prison.
Finally, Jianxing Chen, 40, of Belize, was charged in the superseding indictment for his alleged involvement in this money laundering and drug trafficking conspiracy. He is pending extradition following his arrest in Lima, Peru. Chen was captured with significant assistance from The International Criminal Police Organization (INTERPOL).
The DEA’s Louisville Division and the DEA’s Special Operations Division – Bilateral Investigations Unit are investigating this case, with assistance from the DEA’s Office of Special Intelligence, Document and Media Exploitation Unit and the DEA’s offices in New York, Chicago, Los Angeles, Houston, Omaha, Atlanta, Newark, Portland Dallas, Mexico City, Merida (Mexico), Guatemala City, Belmopan (Belize), Beijing, Hong Kong, Jakarta (Indonesia), Manila (Philippines), Tokyo, Seoul, Bangkok, Lima (Peru), and Canberra (Australia). The U.S. Department of State’s Diplomatic Security Service (DSS), U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), U.S. Postal Inspection Service, INTERPOL, and U.S. Customs and Border Protection (CBP – National Targeting Center) were partners in the investigation of this case.
Assistant U.S. Attorneys David A. Peters and Michael P. Ben’Ary and Trial Attorneys Kerry Blackburn, Mary K. Daly, and Stephen A. Sola of the Justice Department’s Money Laundering and Asset Recovery Section are prosecuting the case.
The Justice Department’s Office of International Affairs provided significant assistance. The Australian Criminal Intelligence Commission, the Australian Federal Police, the Australia Department of Home Affairs, the Mexican Federal Police, the Guatemalan National Civil Police, and the New Zealand Police also provided significant assistance.
This prosecution is part of two Organized Crime Drug Enforcement Task Force (OCDETF) investigations known as Operation Dark Castle and Operation Taishan Triangle. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:19-cr-334.
Las Vegas Couple Indicted for Tax Evasion SchemeRead the Press Release
A federal grand jury in Las Vegas, Nevada, returned an indictment today charging a Las Vegas husband and wife with conspiring to defraud the IRS, tax evasion, filing a false tax return, assisting in the filing of false tax returns, and failing to file tax returns and pay federal income taxes.
According to allegations in the indictment, from at least 2005 through at least 2020, Scott H. Lawrence, a real estate professional, and Debra R. Lawrence, an owner of an interior design business, conspired to conceal their income and true financial condition from the IRS and to obstruct the IRS’s efforts to collect their unpaid tax liabilities. As part of the scheme, Scott and Debra Lawrence allegedly submitted to the IRS false documents, including false tax returns and collection information statements, that understated their true income. The indictment further alleges that Scott and Debra Lawrence sought to evade the payment of taxes owed for tax years 2005 to 2010 by cashing substantial portions of paychecks, thereby thwarting IRS levies and collection actions, and that they willfully failed to pay taxes for tax years 2014 to 2018. In total, Scott and Debra Lawrence are alleged to have caused a tax loss to the IRS of approximately $1,758,128.
Scott and Debra Lawrence are scheduled to make their initial court appearances on August 11, 2021, before U.S. Magistrate Judge Youchah of the U.S. District Court for the District of Nevada. If convicted, each defendant faces a maximum penalty of five years in prison for conspiracy to defraud the United States and for each count of tax evasion; three years in prison for each count of filing a false tax return and assisting in the filing of false tax returns; and one year in prison for each count of failing to file a tax return and failing to pay income taxes. 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 Christopher Chiou for the District of Nevada made the announcement.
The IRS-Criminal Investigation is investigating this case.
Trial Attorneys Valerie Preiss and Patrick Burns of the Justice Department’s Tax Division are prosecuting the case.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Las Vegas Couple Indicted for Tax Evasion SchemeRead the Press Release
LAS VEGAS, Nev. – A federal grand jury in Las Vegas, Nevada, returned an indictment today charging a Las Vegas husband and wife with conspiring to defraud the IRS, tax evasion, filing a false tax return, assisting in the filing of false tax returns, and failing to file tax returns and pay federal income taxes.
According to allegations in the indictment, from at least 2005 through at least 2020, Scott H. Lawrence, a real estate professional, and Debra R. Lawrence, an owner of an interior design business, conspired to conceal their income and true financial condition from the IRS and to obstruct the IRS’s efforts to collect their unpaid tax liabilities. As part of the scheme, Scott and Debra Lawrence allegedly submitted to the IRS false documents, including false tax returns and collection information statements, that understated their true income. The indictment further alleges that Scott and Debra Lawrence sought to evade the payment of taxes owed for tax years 2005 to 2010 by cashing substantial portions of paychecks, thereby thwarting IRS levies and collection actions, and that they willfully failed to pay taxes for tax years 2014 to 2018. In total, Scott and Debra Lawrence are alleged to have caused a tax loss to the IRS of approximately $1,758,128.
Scott and Debra Lawrence are scheduled to make their initial court appearances on August 11, 2021, before U.S. Magistrate Judge Youchah of the U.S. District Court for the District of Nevada. If convicted, each defendant faces a maximum penalty of five years in prison for conspiracy to defraud the United States and for each count of tax evasion; three years in prison for each count of filing a false tax return and assisting in the filing of false tax returns; and one year in prison for each count of failing to file a tax return and failing to pay income taxes. 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 Christopher Chiou for the District of Nevada made the announcement.
The IRS-Criminal Investigation is investigating this case.
Trial Attorneys Valerie Preiss and Patrick Burns of the Justice Department’s Tax Division are prosecuting the case.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
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Justice Department Settles with Florida’s Volusia County School District to Protect Students with Disabilities from Classroom Removals and Other DiscriminationRead the Press Release
The Justice Department announced today a settlement agreement with Florida’s Volusia County School District (VCS) to address the district’s systemic and discriminatory practices that punish students with disabilities for their disability-related behavior and deny them equal access to VCS’s programs and services.
The department conducted an investigation under Title II of the Americans with Disabilities Act (ADA) after the U.S. Attorney’s Office for the Middle District of Florida received a complaint from a local legal aid organization on behalf of several students, many of whom have Autism Spectrum Disorder. The complaint alleged that VCS unnecessarily excluded students with disabilities from the school’s education programs and services by regularly: (1) requiring parents or guardians to pick up their children with disabilities from school or to keep them home; (2) disciplining students for behavior resulting from their disability; and (3) engaging with law enforcement to remove students with disabilities, one as young as kindergarten age, from school.
The department’s investigation substantiated the allegations in the complaint, confirming that VCS had excluded students with disabilities from its programs and services through unnecessary removals from the classroom. It also found that VCS staff often failed to implement necessary behavioral supports and lacked training on how to properly respond to students’ disability-related behavior. These issues led to the exclusion of students with disabilities from VCS’s programs and services and, at times, resulted in calls to law enforcement to remove students with disabilities from school, including through the misuse of Florida’s Baker Act procedures. The Baker Act permits the involuntary admission of a person with a mental illness to a psychiatric facility for up to 72 hours if certain criteria are met.
“Students should never be denied their education on the basis of disability, and we will not yield until the full measure of rights guaranteed by the ADA is a reality for all,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The department is committed to enforcing the law to make sure schools meet the needs and respect the rights of all their students.”
“We are appreciative that VCS cooperated with our investigation, recognized the opportunity to improve, and has committed to the successful implementation of our agreement,” said Acting U.S. Attorney Karin Hoppmann for the Middle District of Florida. “We look forward to working with the district to improve educational opportunities for all students.”
The U.S. Attorney’s Office for the Middle District of Florida worked in collaboration with the Civil Rights Division’s Disability Rights Section (DRS) to investigate this case.
The enforcement of Title II of the ADA in schools is a top priority of the department’s Civil Rights Division. Additional information about the Civil Rights Division is available on its website at www.justice.gov/crt, and additional information about the work of the DRS is available at https://www.ada.gov. Members of the public may report possible civil rights violations at https://civilrights.justice.gov/report/. Information about the Civil Rights Unit of the United States Attorney’s Office for the Middle District of Florida and a complaint form for the unit can be found at https://www.justice.gov/usao-mdfl/civil-rights.
Justice Department Settles with Florida’s Volusia County School District to Protect Students with Disabilities from Classroom Removals and Other DiscriminationRead the Press Release
WASHINGTON – The Justice Department announced today a settlement agreement with Florida’s Volusia County School District (VCS) to address the district’s systemic and discriminatory practices that punish students with disabilities for their disability-related behavior and deny them equal access to VCS’s programs and services.
The department conducted an investigation under Title II of the Americans with Disabilities Act (ADA) after the U.S. Attorney’s Office for the Middle District of Florida received a complaint from a local legal aid organization on behalf of several students, many of whom have Autism Spectrum Disorder. The complaint alleged that VCS unnecessarily excluded students with disabilities from the school’s education programs and services by regularly: (1) requiring parents or guardians to pick up their children with disabilities from school or to keep them home; (2) disciplining students for behavior resulting from their disability; and (3) engaging with law enforcement to remove students with disabilities, one as young as kindergarten age, from school.
The department’s investigation substantiated the allegations in the complaint, confirming that VCS had excluded students with disabilities from its programs and services through unnecessary removals from the classroom. It also found that VCS staff often failed to implement necessary behavioral supports and lacked training on how to properly respond to students’ disability-related behavior. These issues led to the exclusion of students with disabilities from VCS’s programs and services and, at times, resulted in calls to law enforcement to remove students with disabilities from school, including through the misuse of Florida’s Baker Act procedures. The Baker Act permits the involuntary admission of a person with a mental illness to a psychiatric facility for up to 72 hours if certain criteria are met.
The settlement agreement requires VCS to revise its policies and practices, particularly those concerning attendance and removals, discipline, law enforcement involvement, and behavioral interventions and supports, to ensure that students with disabilities receive the protections to which they are entitled under the ADA. VCS also must provide staff training regarding the ADA and establish an ADA complaint procedure and tracking system. Finally, the settlement requires VCS to retain an outside consultant and create a new, internal position responsible for evaluating VCS’s disciplinary practices and ensuring compliance with the settlement agreement.
“Students should never be denied their education on the basis of disability, and we will not yield until the full measure of rights guaranteed by the ADA is a reality for all,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “The department is committed to enforcing the law to make sure schools meet the needs and respect the rights of all their students.”
“We are appreciative that VCS cooperated with our investigation, recognized the opportunity to improve, and has committed to the successful implementation of our agreement,” said Acting U.S. Attorney Karin Hoppmann for the Middle District of Florida. “We look forward to working with the district to improve educational opportunities for all students.”
The U.S. Attorney’s Office for the Middle District of Florida worked in collaboration with the Civil Rights Division’s Disability Rights Section (DRS) to investigate this case.
The enforcement of Title II of the ADA in schools is a top priority of the department’s Civil Rights Division. Additional information about the Civil Rights Division is available on its website at www.justice.gov/crt, and additional information about the work of the DRS is available at https://www.ada.gov. Members of the public may report possible civil rights violations at https://civilrights.justice.gov/report/. Information about the Civil Rights Unit of the United States Attorney’s Office for the Middle District of Florida and a complaint form for the unit can be found at https://www.justice.gov/usao-mdfl/civil-rights.