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Wednesday 9 June 2021
Vicksburg Man Sentenced to 2 ½ Years in Federal Prison for Possessing a Firearm as a Convicted FelonRead the Press Release
Jackson, Miss. - A Vicksburg man was sentenced today to 30 months in prison, followed by 3 years of supervised release, for possessing a firearm as a convicted felon, announced Acting U.S. Attorney Darren LaMarca and Special Agent in Charge Michelle A. Sutphin with the Federal Bureau of Investigation in Mississippi.
On March 28, 2020, at 3:30 a.m., Darren Antonyo Mazie, 36, was driving during a city-wide curfew and encountered a Vicksburg Police Officer. Mazie possessed a firearm at the time and was a convicted felon, having been found guilty of burglarizing a business.
Mazie was charged in a federal criminal indictment with possession of a firearm by convicted felon. He pled guilty on March 3, 2021.
The Vicksburg Police Department and the Federal Bureau of Investigation investigated the case.
Assistant U.S. Attorney Bert Carraway prosecuted the case.
Union County Man Admits Offering Bribes to Postal Service EmployeesRead the Press Release
NEWARK, N.J. – A Union County, Jersey, man today admitted offering bribes to a U.S. Postal Service (USPS) employee to steal check books and credit cards from the mail, Acting U.S. Attorney Rachael A. Honig announced.
Jabre Beauvoir, 22, of Elizabeth, New Jersey, pleaded guilty by videoconference before U.S. District Judge Kevin McNulty to an information charging him with one count of bribery.
According to documents filed in this case and statements made in court:
In the summer of 2019, Beauvoir offered bribes to USPS employees to steal mail containing check books and credit cards. Beauvoir typically offered $100 per package of check books or credit cards to induce USPS employees to steal such mail matter and deliver it to him. It was further part of the scheme that Beauvoir and others then posed as the actual accountholders to whom the check books or credit cards originally were mailed by fraudulently signing checks, activating the stolen credit cards, and fraudulently using them.
The bribery charge is punishable by a maximum potential penalty of 15 years in prison and a fine of $250,000, or twice the gross gain derived or loss sustained, or three time the monetary equivalent of the thing of value received, whichever is greatest. Sentencing is scheduled for Oct. 26, 2021.
Acting U.S. Attorney Honig credited postal inspectors of the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Rodney M. Hopkins, and special agents with the USPS-Office of Inspector General, Northeast Area Field Office, under the direction of Special Agent in Charge Matthew Modafferi, with the investigation leading to today’s arrest. He also thanked the U.S. Secret Service, the New Jersey State Police, the Elizabeth Police Department, and the Secaucus Police Department for their assistance.
The government is represented by Assistant U.S. Attorney Elaine K. Lou of the Special Prosecutions Division in Newark.
Union County Mail Carrier Charged with Making False Statements to Obtain Federal Workers’ Compensation BenefitsRead the Press Release
NEWARK, N.J. – A Union County, New Jersey, U.S. Postal Service (USPS) mail carrier made her initial court appearance today on charges of making false statements to obtain federal workers’ compensation benefits, Acting U.S. Attorney Rachael A. Honig announced.
Aida Perez, 42, of Roselle Park, New Jersey, is charged by complaint with one count of knowingly and willfully falsifying, concealing, and covering up a material fact, and making a false, fictitious, and fraudulent statement and representation in connection with the application for and receipt of federal workers’ compensation benefits. Perez made her initial appearance today by videoconference before U.S. Magistrate Judge Mark Falk and was released on bail.
According to documents filed in this case and statements made in court:
Perez worked as a mail carrier for the USPS in Westfield, New Jersey. On Nov. 18, 2020, Perez signed and certified a form in which she alleged she sustained an ankle sprain on Nov. 9, 2020, while performing her duties. In subsequent forms, Perez certified that she did not receive earnings from employment outside of her federal job. However, an investigation revealed that Perez operated a business from which she received substantial income. For example, during the investigation, an undercover law enforcement officer purchased $245 in goods from Perez’s business.
The count of making false statements to obtain federal workers’ compensation benefits carries a maximum penalty of five years in prison and a $250,000 fine.
Acting U.S. Attorney Honig credited members of the USPS – Office of Inspector General, Northeast Area Field Office, under the direction of Special Agent in Charge Matthew Modafferi, with the investigation leading to the charges.
The government is represented by Assistant U.S. Attorney Mark J. Pesce of the U.S. Attorney’s Office’s OCDETF/Narcotics Unit in Newark.
The charge and allegations contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
U.S. Attorney’s Office to Join Department of State and Myrtle Beach PD for Press Conference Tomorrow, June 10, at 2:30 PM in Myrtle BeachRead the Press Release
Myrtle Beach, South Carolina --- Acting United States Attorney M. Rhett DeHart announced today that a press conference will be held tomorrow – June 10, 2021 – at 2:30 p.m., at the Warren S. Gall Police Annex at 3340 Mustang Street, Myrtle Beach SC 29577.
Represented at the press conference will be the U.S. Attorney’s Office for the District of South Carolina, the U.S. Department of State’s Diplomatic Security Service (DSS), and the Myrtle Beach Police Department.
WHEN: Tomorrow – Thursday, June 10 – at 2:30 p.m.
WHERE: Warren S. Gall Police Annex
3340 Mustang Street
Myrtle Beach, South Carolina 29577
NOTE: Press inquiries regarding logistics should be directed to Michael Mule’, 843-327-0882. Members of the media wishing to attend the remarks should begin gathering outside the Warren S. Gall Police Annex at 2 p.m., 30 minutes in advance.
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Two Lansing Men Sentenced to Federal Prison for Armed Robbery SpreeRead the Press Release
GRAND RAPIDS, MICHIGAN —U.S. Attorney Andrew Birge announced today that James Winston Honeysucker, Jr., of Lansing, Michigan, was sentenced to serve more than 27 years in federal prison for committing four armed robberies in Lansing and Battle Creek, Michigan. Earlier this year, Honeysucker’s co-defendant, Wilnell Lakeey Henry, also of Lansing, was sentenced to more than 6 years for his role as Honeysucker’s getaway driver. The pair were also ordered to pay full restitution to their victims.
From August through October 2019, Honeysucker robbed four cash advance businesses at gunpoint in Lansing and Battle Creek. In each case, he pretended to be interested in applying for a loan before suddenly brandishing a pistol, pointing it at the clerk, and demanding cash. After his first robbery, Honeysucker recruited Henry to serve as his getaway driver, and they committed the remaining three robberies together.
Investigators with the Battle Creek Police Department located and arrested Henry after surveillance videos showed him picking Honeysucker up after the robbery on October 22. Later that night, BCPD officers located Honeysucker at the bus station in Chicago, Illinois. BCPD officers then contacted their counterparts in Chicago, who went to the bus station and arrested Honeysucker with more than $17,000 cash and a loaded pistol in his possession. The FBI then assisted and expanded the investigation to definitively link Honeysucker and Henry to the three other robberies.
Honeysucker was convicted in February following a four-day jury trial, during which Henry cooperated with federal authorities and testified against Honeysucker. At Honeysucker’s sentencing, Chief U.S. District Court Judge Robert J. Jonker expressed relief that no one was killed during the robbery spree and admonished Honeysucker for causing “real human toll” by robbing tellers at gunpoint. Chief Judge Jonker was particularly struck by one teller’s testimony that during the robbery the thought flashed through her mind that she wouldn’t see her child again.
In announcing the sentences, U.S. Attorney Birge stated, “Instead of working for their money, these brazen criminals used a loaded pistol to threaten and steal from those trying to earn an honest living. They were identified and apprehended so they could be brought to justice thanks to the outstanding work of our partners at the Battle Creek Police Department, Lansing Police Department, and Eaton County Sheriff’s Department and the Federal Bureau of Investigation and Chicago Police Department.”
“This defendant committed four brazen armed robberies that terrorized innocent victims and endangered lives. The sentences handed down in this case should serve as an example to others – if you rob any kind of business with a firearm in Michigan, law enforcement at all levels will work together to bring you to justice,” said Timothy Waters, Special Agent in Charge of the FBI in Michigan.
This case was prosecuted by Assistant U.S. Attorneys Patrick Castle and Daniel Mekaru, and investigated by the Federal Bureau of Investigation, Battle Creek Police Department, Lansing Police Department, Eaton County Sheriff’s Department, and Chicago Police Department.
September 30, 2019 – $17,000 Approved Cash on W. Columbia Ave. Battle Creek, Michigan###
Tulsa Man Convicted for Violent Assault on Former Intimate PartnerRead the Press Release
A Tulsa man pleaded guilty Tuesday in federal court for assaulting and strangling his former intimate partner, announced Acting U.S. Attorney Clint Johnson.
Terrance DuJuan Reed, 29, pleaded guilty to assault of an intimate partner by strangling, suffocating, or attempting to strangle or suffocate in Indian Country. Sentencing is scheduled for Sept. 13, 2021.
According to the complaint and accompanying affidavit initially filed in the case, Reed asked for a ride on Feb. 16, 2020. During the car ride, Reed began yelling at and questioning the victim about a recent trip she took with friends, and once they arrived at his destination, he demanded to check her text messages. Following the victim’s refusal to hand over her cell phone, Reed punched the victim, dragged her from the car and began to strangle the victim with his hands. He then placed his arm around her throat and neck and strangled her until she passed out. He continued his violent attack by punching the victim in the head, eyes and mouth. Upon regaining consciousness, she attempted to call 911 for help, but Reed took her cell phone and fled the scene.
The victim drove herself to a family member’s home to receive help, 911 was called, and emergency responders transported the victim to the hospital for care.
Reed was located and arrested by Tulsa Police officers on Feb.17, 2020.
The FBI and Tulsa Police Department conducted the investigation. Assistant U.S. Attorney Cymetra M. Williams is prosecuting the case. Ms. Williams is a prosecutor from the U.S. Attorney’s Office in the District of New Jersey. She volunteered to assist prosecution efforts here in the Northern District of Oklahoma due to increased jurisdictional responsibilities regarding crimes involving Native American victims or defendants and that occur within the Muscogee and Cherokee Nation reservations.
Troy Man Pleads Guilty to Trafficking Kilograms of HeroinRead the Press Release
ALBANY, NEW YORK – Carlos Leon Rivera, age 62, of Troy, New York, pled guilty today to conspiring to traffic more than 1 kilogram of heroin, and also admitted that the conspiracy involved up to 10 kilograms of heroin.
The announcement was made by Acting United States Attorney Antoinette T. Bacon; Special Agent in Charge Ray Donovan, U.S. Drug Enforcement Administration (DEA), New York Division; and Rensselaer County Sheriff Pat Russo.
In pleading guilty, Leon admitted to working with Mario Figueroa-Portalatin to sell heroin in and around Troy, from January 2019 to March 2020. Leon admitted to regularly traveling to New York City, where he would acquire at least 500 grams of heroin at a time from Figueroa’s source of supply. Leon brought the heroin back to Troy, where he and Figueroa prepared and packaged it for sale to customers.
Leon also admitted that when DEA and other law enforcement searched his apartment on March 30, 2020, he possessed approximately 31 grams of heroin, 23.7 grams of fentanyl (in tablet form), and 60 grams of cocaine; $7,150 in drug proceeds; a Ruger model EC9S, 9mm handgun; and a Glock 30 .45 caliber handgun.
Leon, who has been in custody since March 30, 2020, faces at least 10 years and up to life in prison, as well as post-release supervision of at least 5 years and up to life, when Chief United States District Judge Glenn T. Suddaby sentences him on October 28, 2021. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines and other factors.
Figueroa-Portalatin, age 42, of Troy, pled guilty on August 11, 2020 to conspiring to distribute 1 kilogram or more of heroin, and is pending sentencing.
A third defendant, Jose Leon Roldan, age 42, of Troy, has pled not guilty to drug charges and is pending trial. The charges against Jose Leon Roldan are merely accusations. He is presumed innocent unless and until proven guilty.
This case is being investigated by the DEA and the Rensselaer County Sheriff’s Office, and is being prosecuted by Assistant U.S. Attorney Michael Barnett.
Three Charleston Men Plead Guilty to Federal Drug ChargesRead the Press Release
CHARLESTON, W.Va. – Three Charleston men pleaded guilty this week to federal drug charges. Dante Williams, 24, Darius Coles, 23, and Joshua Lawson, 31, were indicted in February 2021 in connection with a long-term investigation dubbed the “Woo Boyz.”
According to court documents, Williams admitted that on January 14, 2021, he sold two ounces of methamphetamine to a confidential informant working with law enforcement. Williams arranged to first meet the informant in the parking lot of the Family Dollar store on Charleston’s West Side, but then directed the informant to follow him to Swinburn Street where the transaction took place. Williams also admitted that he fronted the informant an additional two ounces of methamphetamine for which Williams would be paid later. Williams pleaded guilty to distribution of 50 grams or more of methamphetamine and faces a minimum mandatory sentence of 10 years and up to life in prison when he is sentenced on September 23, 2021.
Coles admitted that on January 27, 2021, he met a confidential informant at the Go-Mart near Bigley Avenue in Charleston to collect $1,200 for an outstanding drug debt. Coles collected the $1,200 and fronted the confidential informant an additional amount of methamphetamine to be paid for later. Coles pleaded guilty to distribution of methamphetamine and faces up to 20 years in prison when he is sentenced on September 9, 2021.
According to Lawson’s plea agreement and statements made in court, after Lawson left a meeting with his methamphetamine source of supply on December 27, 2020, officers with the Charleston Police Department conducted a traffic stop on his vehicle in the 600 block of Ruffner Avenue. An officer performed a pat down of Lawson and found an ounce of methamphetamine hidden in his groin area. Lawson admitted he intended to distribute the methamphetamine. Lawson pleaded guilty to possession with intent to distribute five grams or more of methamphetamine and faces a mandatory minimum sentence of five years and up to 40 years in prison when he is sentenced on September 9, 2021.
Acting United States Attorney Lisa G. Johnston made the announcement and commended the investigative work of the Drug Enforcement Administration (DEA), the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the Charleston Police Department, the Metropolitan Drug Enforcement Network Team (MDENT), the U.S. Marshals Service and the West Virginia State Police. The Appalachia High Intensity Drug Trafficking Area (HIDTA) provided critical support to the investigative agencies.
Senior United States District Judge John T. Copenhaver, Jr. presided over the hearings. Assistant United States Attorney Monica Coleman is handling the prosecution.
The investigation was part of the Department of Justice’s Organized Crime Drug Enforcement Task Force (OCDETF). OCDETF was established in 1982 to conduct comprehensive, multilevel attacks on major drug trafficking and money laundering organizations and is the keystone of the Department of Justice’s drug reduction strategy. Today, OCDETF combines the resources and expertise of its member federal agencies in cooperation with state and local law enforcement. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking organizations, transnational criminal organizations, and money laundering organizations that present a significant threat to the public safety, economic, or national security of the United States.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 2:21-cr-00032 (Williams, et al.).
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Thirteenth Reagor Dykes Employee SentencedRead the Press Release
The thirteenth Reagor Dykes Auto Group employee was sentenced for her role in the auto group’s floor plan fraud scheme, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Andrea Kate Phillips, 40, pleaded guilty in January to misprision of a felony. On Tuesday, she was sentenced to 4 years’ probation and ordered to pay $40,254,297.72 in restitution by U.S. District Judge Matthew J. Kacsmaryk.
In plea papers, Ms. Phillips, an accounting associate and office manager at Reagor Dykes Plainview LP (a Ford store in Plainview, Texas) admitted the auto group participated in a fraudulent floor plan fraud scheme.
Ms. Phillips admitted that the auto group routinely sold vehicles “out of trust” – meaning that they failed to repay lenders within seven days of selling the vehicle financed by that lender.
Just before the lender conducted audits, Ms. Phillips admitted she routinely would create documents falsifying vehicles sales dates on official paperwork to make it appear as though the vehicle had sold within the prior seven days and was not yet out of trust.
Ms. Phillips is the thirteenth RDAG employee sentenced to more than 30 years combined in federal prison for the dummy flooring and check kiting scheme. Reagor Dykes employees previously sentenced include:
- Diana Urias, an office manager in Reagor Dykes’ used car mall in Levelland, pleaded guilty to conspiracy to commit bank fraud and was sentenced to 2 years in federal prison and ordered to pay $19,335,901.10 in restitution, joint and severally.
- Sheila Miller, an RDAG group controller, pleaded guilty to conspiracy to commit bank fraud and was sentenced to 27 months in federal prison and ordered to pay $19,335,901.10 in restitution, joint and severally.
- Paige Johnston, an office manager in Reagor Dykes’ Chevrolet store in Floydada, pleaded guilty to conspiracy to commit wire fraud and was to 27 in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.
- Lindsay Williams, and RDAG group accounting manager, pleaded guilty to conspiracy to commit bank fraud and was sentenced to 27 months in federal prison and ordered to pay $19,335,901.10 in restitution, joint and severally.
- Sherri Wood, an office manager at Reagor Dykes’ Ford store in Plainview, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 30 months in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.
- Pepper Rickman, an accounting controller at Reagor Dykes’ Toyota store in Plainview, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 4 years in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.
- Brad Fansler, an RDAG group administrative director, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 42 months in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.
- Ashley Dunn, executive assistant to the CEO, pleaded guilty to conspiracy to commit bank fraud and was sentenced to 30 months in federal prison and ordered to pay $19,335,901.10 in restitution, joint and severally.
- Whitney Maldonado, an office manager at Reagor Dykes’ Mitsubishi store in Lubbock, pleaded guilty to conspiracy to commit wire fraud was sentenced on 27 months in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.
- Elaina Cabral, an office manager at Reagor Dykes’ Toyota store in Plainview, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 27 months in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.
- Mistry Canady, an office manager at Reagor Dykes’ Ford store in Lamesa, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 2 years in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.
- Wesley Neel, RDAG Safety & Compliance Manager, pleaded guilty to conspiracy to commit wire fraud and was sentenced to 30 months in federal prison and ordered to pay $40,254,297.72 in restitution, joint and severally.
Steven Reinhart, RDAG Legal Compliance Director, and Shane Smith, RDAG CEO, both have pleaded guilty and are awaiting sentencing. Bart Reagor, owner of RDAG, is scheduled for trial in October.
The Federal Bureau of Investigation and Internal Revenue Services - Criminal Investigation Division conducted the investigation. Assistant U.S. Attorneys Joshua Frausto, Jeffrey Haag, and Amy Burch prosecuted the case.
Third and Final Defendant Pleads Guilty to Conspiring to Provide Material Support to ISISRead the Press Release
Today, Mohamed Haji, 28, of Lansing, Michigan, pleaded guilty to conspiring to provide material support to a designated foreign terrorist organization, namely the Islamic State of Iraq and al-Sham, aka ISIS. In January 2020, his co-defendants Muse Muse and Mohamud Muse pleaded guilty to the same offense.
According to court documents, between December 2018 and January 2019, co-defendant Muse Muse coordinated with an individual he believed to be a Somali ISIS fighter to wire funds to be used to purchase airline tickets for travel to Mogadishu, Somalia, where he believed he would meet an ISIS representative. All three defendants: picked up money to provide Muse Muse the funds to travel to join ISIS, pledged allegiance to ISIS in recorded videos, and submitted their videos to individuals they believed were associated with ISIS. Additionally, throughout the conspiracy, all three defendants participated in numerous discussions regarding traveling overseas to join ISIS and even adopted fighter aliases by which they would be known when fighting for ISIS.
On Jan. 21, 2019, special agents of the FBI and members of its Joint Terrorism Task Force (JTTF) arrested defendant Muse Muse at the Gerald R. Ford International Airport in Grand Rapids, after he checked in for a flight to the first of a series of destinations on his way to Mogadishu with the goal of joining ISIS. Shortly thereafter, his brother Mohamud Muse and cousin Mohamed Haji were arrested as co-conspirators.
Muse, Mohamud Muse and Haji were indicted by a federal grand jury on multiple charges, including conspiracy to provide material support to a designated foreign terrorist organization. This federal offense required the government to prove that Haji: (1) agreed with one or more individuals to provide material support or resources (which includes personnel) to ISIS, a foreign terrorist organization; (2) knew that ISIS was a designated foreign terrorist organization or had engaged or engages in terrorist activity; and (3) is a U.S. national or some part of the offense occurred in the United States. Haji admitted each of those elements of the crime. He is scheduled to be sentenced on Sept. 22 and faces a maximum of 20 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant Attorney General John C. Demers of the Justice Department’s National Security Division and U.S. Attorney Andrew Birge for the Western District of Michigan made the announcement.
The FBI is investigating the case, with valuable assistance provided by the Michigan State Police, Kent County Sheriff’s Office, Eaton County Sheriff’s Office, Michigan State University Police Department, Lansing Police Department, Grand Rapids Police Department, Grand Rapids Airport Police, the U.S. Marshals Service, and the Department of Homeland Security's Transportation Security Administration, Federal Air Marshals, and U.S. Customs and Border Protection.
Trial Attorney David Smith of the National Security Division’s Counterterrorism Section and Assistant U.S. Attorneys Clay M. West and Christopher M. O’Connor of the Western District of Michigan are prosecuting the case.
Third Arkansas Physician Sentenced to Federal Prison for Prescription FraudRead the Press Release
FORT SMITH – A Fort Smith physician, Donald E. Hinderliter, was sentenced today to 4 years in federal prison followed by 1 year of supervised release on one count of Distribution of a Controlled Substance without an Effective Prescription. The Honorable Judge P. K. Holmes III presided over the sentencing hearing in the U.S. District Court in Fort Smith.
According to court documents, Hinderliter, 85, of Fort Smith, pleaded guilty to a felony Information charging unlawful distribution of a controlled substance namely, alprazolam. From approximately January 2016 and through November 8, 2018, Hinderliter was an owner and practitioner at Hinderliter Pain Clinic that operated as a pain management clinic in Barling, Arkansas. In May 2017, the Drug Enforcement Administration (DEA) received several anonymous complaints that Hinderliter was operating a “pill mill” under the name Hinderliter Pain Clinic. The complaints stated that Hinderliter and his associate, Dr. Cecil W. Gaby, charged cash, prescribed hydrocodone and benzodiazepines in the same amount to patients regardless of a particular patient’s prognosis or need, and that patients traveled great distances within the state of Arkansas and surrounding states seeking large quantities and dangerous combinations of oxycodone, hydrocodone, alprazolam, and methadone, among other controlled substances. As part of the plea, Hinderliter admitted that he prescribed opioids and benzodiazepines to more than 150 individuals, often not for a legitimate medical purpose and not in the usual course of professional practice. Specifically, on October 17, 2016, Hinderliter prescribed 84 alprazolam 2mg pills, a Schedule IV controlled substance to a patient that was not for a legitimate medical purpose and not in the usual course of professional practice.
On May 27, 2021, Dr. Cecil W. Gaby was sentenced to 120 months imprisonment for his role in the Hinderliter Pain Clinic and Gaby Medical Clinic in Fort Smith, Arkansas. On the same date, Dr. Robin Cox was sentenced to 36 months imprisonment for distribution of opioid medications outside legitimate medical practice at an unrelated clinic in Rogers, Arkansas.
U.S. Attorney David Clay Fowlkes of the Western District of Arkansas made the announcement.
The Drug Enforcement Administration (DEA), DEA Diversion Little Rock, Federal Bureau of Investigation (FBI), the United States Department of Health and Human Services Office of Inspector General (HHS), Arkansas State Medical Board and the Fort Smith Police Department investigated the case.
Special Assistant U.S. Attorney Anne Gardner and Assistant U.S. Attorney Brandon Carter prosecuted the case for the United States.
Third and Final Lansing Defendant Convicted of Terrorism ChargeRead the Press Release
GRAND RAPIDS, MICHIGAN — United States Attorney Andrew Birge announced today that three residents of Lansing, Michigan have been convicted of conspiring to provide material support to a designated foreign terrorist organization, namely the Islamic State of Iraq and al-Sham (“ISIS”). Today, the third and final defendant in the case, Mohamed Haji, pleaded guilty to the federal crime of conspiring to provide material support to a designated foreign terrorist organization. In January 2020, his co-defendants Muse Muse and Mohamud Muse pleaded guilty to the same offense.
On January 21, 2019, special agents of the Federal Bureau of Investigation (FBI) and members of its Joint Terrorism Task Force arrested defendant Muse Muse at the Gerald R. Ford International Airport in Grand Rapids, Michigan, after he checked in for a flight to the first of a series of destinations on his way to Mogadishu, Somalia, with the goal of joining ISIS. Shortly thereafter, his brother Mohamud Muse and cousin Mohamed Haji were arrested as co-conspirators. According to court documents, between December 2018 and January 2019, Muse Muse coordinated with an individual he believed to be a Somali ISIS fighter to wire funds to be used to purchase airline tickets for travel to Mogadishu, Somalia, where he believed he would meet an ISIS representative. All three defendants picked up money to provide Muse Muse the funds to travel to join ISIS, all three defendants pledged allegiance to ISIS in recorded videos, and all three submitted their videos to individuals they believed were associated with ISIS. Additionally, throughout the conspiracy, all three defendants participated in numerous discussions during which they discussed traveling overseas to join ISIS and even adopted fighter aliases by which they would be known when fighting for ISIS.
Muse, Mohamud Muse, and Haji were indicted by a federal grand jury on multiple charges, including conspiracy to provide material support to a designated foreign terrorist organization. This federal offense required the government to prove that Haji: (1) agreed with one or more individuals to provide material support or resources (which includes personnel) to ISIS, a foreign terrorist organization; (2) knew that ISIS was a designated foreign terrorist organization or had engaged or engages in terrorist activity or terrorism; and (3) is a U.S. national or some part of the offense occurred in the United States. At his change of plea hearing before Chief United States District Judge Robert J. Jonker, Haji admitted each of those elements of the crime.
All three defendants will be sentenced by Chief Judge Jonker at a later date. The crime is punishable by up to 20 years in federal prison. The Court will determine the ultimate sentence to be imposed after evaluating the applicable federal Sentencing Guidelines and considering the statutory sentencing factors, including the nature and circumstances of the offense; the history and characteristics of each defendant; the seriousness of the offense; and the need to promote respect for the law, to provide just punishment, and protect the public from future crimes of each defendant.
United States Attorney Andrew Birge stated, “There is no priority higher for my Office than detecting, preventing and prosecuting terrorism. With this successful investigation and prosecution, the United States Attorney’s office and its law enforcement partners prevented these young men from assisting a dangerous international terrorist organization and held them accountable for conspiring to do so. Nearly 80 countries around the globe have committed to eliminating the threat ISIS poses. Every person and every resource bound for a terrorist organization that we intercept impacts the ability of that organization to carry out attacks here and overseas. Every conviction sends a powerful message of deterrence.”
“As this case demonstrates, the threat from foreign terrorist organizations has not ended. The FBI works every day to identify and disrupt those acting in support of these groups both in the United States and throughout the world. The FBI will continue to aggressively pursue these investigations and hold accountable those who provide material support to foreign terrorist groups,” said Timothy Waters, Special Agent in Charge of the FBI’s Detroit Field Office. “The successful disruption of Muse Muse’s plan to travel overseas, and the conviction of those who aided him in that plan, is the result of the hard work and dedication of the FBI’s Joint Terrorism Task Force, which remains committed to protecting the public from terror attacks.”
The FBI’s investigation was assisted by the Michigan State Police, Kent County Sheriff’s Office, Eaton County Sheriff’s Office, Michigan State University Police Department, Lansing Police Department, Grand Rapids Police Department, Gerald R. Ford Airport Police, the U.S. Marshals Service, and the Department of Homeland Security Transportation Security Administration, Federal Air Marshals, and Customs and Border Protection.
Assistant United States Attorneys Clay West and Christopher O’Connor are prosecuting the case with assistance from the National Security Division Counterterrorism Section.
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Texas Man Pleads Guilty to Plotting to Attack Data CentersRead the Press Release
A Wichita Falls man who plotted to blow up a data center in Virginia pleaded guilty Wednesday to malicious attempt to destroy a building with an explosive, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Seth Aaron Pendley, 28, was arrested in April after attempting to obtain an explosive device from an undercover FBI employee in Fort Worth. He entered his guilty plea today before U.S. Magistrate Judge Hal R. Ray, Jr.
“Due in large part to the meticulous work of the FBI’s undercover agents, the Justice Department was able to expose Mr. Pendley’s twisted plot and apprehend the defendant before he was able to inflict any real harm,” said Acting U.S. Attorney Prerak Shah. “We may never know how many tech workers’ lives were saved through this operation – and we’re grateful we never had to find out. Bringing to justice domestic extremists remains one of the Department’s top priorities.”
FBI Dallas Special Agent in Charge Matthew J. DeSarno said, “The FBI thoroughly investigates all credible threats, and The North Texas Joint Terrorism Task Force acted quickly based on information received from a concerned citizen. The defendant sought to cause destruction with an explosive and investigators devised a strategy to disrupt the threat while keeping the public safe from harm. We ask the public to stay vigilant and to continue reporting suspicious or threatening behavior to law enforcement.”
In plea papers, Mr. Pendley admitted that he disclosed his plan to blow up a prominent tech company’s data center to a confidential human source via Signal, an encrypted messaging app, in January.
In late February, he sent the source a list of data center addresses and said he hoped a successful attack could “kill off about 70% of the internet.” When the source offered to help him obtain C4 explosives to use in the attack, Mr. Pendley responded, “F*** yeah.”
Mr. Pendley then showed the source a hand-drawn map of a data center on Smith Switch Road in Virginia, featuring proposed routes of ingress and egress at the facility. He later described how he planned to disguise his car to evade detection by law enforcement.
In late March, the confidential source introduced Mr. Pendley to an individual who he claimed was his explosives supplier. In actuality, the man was an undercover FBI employee.
In recorded conversations, Mr. Pendley allegedly told the undercover employee he planned to attack web servers that he believed provided services to the FBI, CIA, and other federal agencies.
“The main objective is to f*** up the Amazon servers,” he said, adding that he hoped to anger “the oligarchy” enough to provoke a reaction that would convince the American people to take action against what he perceived to be a “dictatorship.”
During that same conversation, Mr. Pendley claimed to have been present at the Jan. 6 attack on the U.S. Capitol. He said that although he did not enter the building, he came prepared with a sawed off AR rifle, which he left in his car.
On April 8, Mr. Pendley again met with the undercover FBI employee to pick up what he believed to be explosive devices. (In actuality, however, the undercover gave Mr. Pendley inert devices.) After the agent showed Mr. Pendley how to arm and detonate the devices, the defendant loaded them into his car. He was then arrested.
A subsequent search of his residence in Wichita Falls turned up an AR-15 receiver with a sawed off barrel, a pistol painted to look like a toy gun, masks, wigs, and notes and flashcards related to the planned attack.
Mr. Pendley now faces between five and 20 years in federal prison. His sentencing hearing has been set for Oct. 1 before U.S. District Judge Reed C. O’Connor.
The FBI’s Dallas Field Office, Wichita Falls Resident Agency and FBI’s North Texas Joint Terrorism Task Force conducted the investigation. Assistant U.S. Attorney Robert J. Boudreau of the Northern District of Texas is prosecuting the case with the assistance of Trial Attorney Alexandra Hughes of the National Security Division.
Sturgeon Lake Man Sentenced to 30 Years, Aitkin Woman Sentenced to 19 Years for Producing Child PornographyRead the Press Release
ST. PAUL, Minn. – A Sturgeon Lake, Minnesota, man and an Aitkin, Minnesota, woman were sentenced in federal court today for producing and attempting to produce child pornography.
Matthew James Gunderson, 31, and Amanda May Walsh, 39, were sentenced by Judge Patrick J. Schiltz to 360 months and 228 months, respectively. The court also sentenced Gunderson and Walsh to 10 years each of supervised release following incarceration. They will be required to register as sex offenders upon their release from prison and will be subject to federal and state sex offender registration requirements, which may apply throughout their lives.
According to court documents, on January 22, 2019, and at other times, Walsh engaged in the sexual abuse of a minor for the purpose of producing videos and photographs of the abuse. On January 24 and January 26, 2019, and at other times, Gunderson engaged in the sexual abuse of minors for the purpose of producing videos and photographs of the abuse.
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, 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.
This case was the result of an investigation conducted by the Minnesota Bureau of Criminal Apprehension and the Aitkin County Sheriff’s Office.
This case was prosecuted by Assistant U.S. Attorney Manda M. Sertich.
St. Louis County man pleads guilty to being a felon in possession of a firearmRead the Press Release
ST. LOUIS – Brandon Phillips, 35, of Florissant, Missouri, pleaded guilty to one count of being a felon in possession of a firearm. Phillips appeared, today, before United States District Court Judge Stephen R. Clark.
On May 23, 2019, officers were conducting surveillance of Phillips as part of a narcotics investigation. Officers located Phillips parking a car at a home in the 2700 block of Blue Heron Drive in Florissant. Phillips was driving his co-defendant, was in the front passenger seat. Officers approached Phillips and the co-defendant, and placed Phillips under arrest for a warrant for violating his parole. Officers found, after searching Phillips, two bags containing suspected controlled substances. In a bag Phillips was carrying, officers located a loaded 9mm Ruger handgun and three bags containing suspected controlled substances.
During interactions with Phillips and his co-defendant, officers observed multiple bags containing pills, powders, and rock-like substances, believed to be controlled substances, sitting on the center console of the car. During a thorough search of the car, officers located a bag tucked partially under the driver’s seat. The bag contained a loaded 9mm handgun, multiple bags containing suspected controlled substances along with Phillips’ identification and credit cards. Laboratory analysis revealed the suspected controlled substances were methamphetamine, fentanyl, and heroin.
Judge Clark has set sentencing for August 15, 2021 at 11:00 a.m.
The St. Louis County Police Department investigated this case. Assistant United States Attorney Jennifer Szczucinski is handling the case.
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Six Charged as Part of Law Enforcement Efforts to Reduce Gun Violence in AshevilleRead the Press Release
ASHEVILLE, N.C. – Acting U.S. Attorney William T. Stetzer announced that six individuals have been indicted on federal charges as a result of federal and local law enforcement efforts to reduce gun violence in Asheville.
Led by the Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF) in partnership with the Asheville Police Department, the local initiative aimed at identifying repeat offenders who illegally possess firearms and/or engage in the distribution of narcotics in the Asheville area.
As a result of this proactive investigation the following six individuals have been charged as follows:
- Andre Ravon Payton, 34, of Asheville, is charged with illegal possession of a firearm and ammunition by a convicted felon, possession of a firearm by an unlawful user of a controlled substance, possession with intent to distribute fentanyl, crack cocaine, and marijuana, and possession of a firearm in furtherance of a drug trafficking crime.
- Daton Tahvian Dapre Alen-Long, 21, of Asheville, is charged with illegal possession of a firearm and 18 rounds of ammunition by a convicted felon, possession with intent to distribute fentanyl, and possession of a firearm in furtherance of a drug trafficking crime.
- Kalon Jamar Logan, 24, of Swannanoa, N.C. is charged with illegal possession of a firearm and 25 rounds of ammunition by a convicted felon.
- Jacob Keith Hall, 31, of Asheville, is charged with illegal possession of a firearm and 25 rounds of ammunition by a convicted felon.
- Juve Markie Lequan McAlpin, 20, of Asheville, is charged with illegal possession of a firearm and 15 rounds of ammunition by a convicted felon.
- Akeem Kwaman McDay, 30, of Asheville, is charged with illegal possession of a firearm and 58 rounds of ammunition by a convicted felon.
The charges contained in the indictments are allegations. The defendants are presumed innocent until proven guilty beyond reasonable doubt in a court of law.
In making today’s announcement Acting U.S. Attorney Stetzer commended the ATF and the Asheville Police Department for their joint investigation that led to the charges and thanked the North Carolina Department of Public Safety for their invaluable assistance.
Assistant U.S. Attorney John Pritchard of the U.S. Attorney’s Office in Asheville is in charge of the prosecution for the government.
These cases are being prosecuted as part of the joint federal, state, and local Project Safe Neighborhoods (PSN) Program, the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
Sioux City Meth Dealer Sentenced in Federal Court for Conspiracy to Distribute MethamphetamineRead the Press Release
A Sioux City man who received methamphetamine which he intended to distribute was sentenced June 8, 2021, to more than 21 years in federal prison.
Levi Hamilton, age 40, from Sioux City, received the prison term after a guilty plea to conspiracy to distribute methamphetamine and possession with intent to distribute methamphetamine.
At the plea hearing, Hamilton admitted that beginning on August 25, 2020 and continuing to August 27, 2020, he and another received 2.7 pounds of methamphetamine via mail which they intended to redistribute around the Sioux City area. Hamilton has an extensive criminal history with over twenty convictions. His prior convictions include: serious assault on a peace officer; three theft convictions; two eluding a peace officer convictions; terrorism; resisting arrest; possession of a controlled substance; three eluding convictions; assault on a peace officer; domestic abuse; and serious assault.
Hamilton was sentenced in Sioux City by United States District Court Chief Judge Leonard T. Strand. Hamilton was sentenced to 262 months’ imprisonment. He must also serve a 5-year term of supervised release after the prison term. There is no parole in the federal system.
Hamilton is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Ron Timmons and investigated by United States Postal Inspection Service and the Drug Enforcement Administration (DEA) Task Force consisting of the DEA; the Woodbury County Sheriff's Office; the Sioux City Police Department; and the Iowa Division of Narcotics Enforcement..
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 20-4078.
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Second Defendant Pleads Guilty to Conspiring to Defraud Massachusetts-Based Uniform Supply CompanyRead the Press Release
BOSTON – A North Carolina man pleaded guilty yesterday to conspiring to defraud his former employer, a Massachusetts-based uniform supply company, by falsifying invoices.
Keith Smedley, 49, pleaded guilty to one count of conspiracy to commit mail fraud and wire fraud. U.S. District Court Judge Nathaniel M. Gorton scheduled sentencing for Oct. 12, 2021.
From approximately 1998 to April 2019, Smedley and others defrauded the uniform supply company by causing it to pay fake invoices for products that were not actually delivered, and by diverting other products that they re-sold for their own benefit. In addition, Smedley and his co-conspirators created a fake supply company, and Smedley caused the uniform-supply company to pay thousands of dollars in invoices to the fake supplier for purported products that he knew would never be delivered.
Smedley is the second former employee of the uniform-supply company to plead guilty in connection with the conspiracy. The remaining defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The charge of conspiracy to commit mail fraud and wire fraud provides for a sentence of up to 20 years in prison, three years of supervised release and a fine of $250,000, or twice the gross gain or loss, whichever is greater. Sentences are imposed by a federal district judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney Nathaniel R. Mendell and Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division made the announcement today. Assistant U.S. Attorneys Sara Miron Bloom and Ian Stearns of Mendell’s Securities, Financial & Cyber Fraud Unit are prosecuting the case.
Schenectady Man Pleads Guilty to Possession of a Molotov CocktailRead the Press Release
ALBANY, NEW YORK – Joel Malek, age 43, of Schenectady, New York, pled guilty today to possession of a “Molotov cocktail” on June 5, 2020, and admitted to using the improvised incendiary device to set fire to a vehicle in Schenectady.
The announcement was made by Acting United States Attorney Antoinette T. Bacon and John B. DeVito, Special Agent in Charge of the New York Field Division of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF).
As part of his guilty plea, Malek admitted that on June 5, 2020, he and a co-conspirator approached a vehicle in Schenectady, at which time the co-conspirator broke the driver-side rear window with a hammer, and then Malek ignited a Molotov cocktail and threw it into the vehicle through the broken window, which started a fire and caused an explosion in the vehicle; no one was injured.
Acting United States Attorney Antoinette T. Bacon stated: “Joel Malek firebombed a vehicle, damaging a Schenectady resident’s property and frightening a community already on edge from the civil unrest that followed George Floyd’s May 25, 2020 death in Minneapolis. Today’s plea holds Malek fully accountable for his brazen and cruel act. I commend the investigators who worked quickly to solve the firebombing and arrest this dangerous man.”
“The defendant’s use of a destructive device not only endangered the lives of our community members but also jeopardized our first responders that had to extinguish and secure the scene,” stated ATF Special Agent in Charge John B. DeVito. "I thank them for their efforts, as well as those of the U.S. Attorney’s Office and the Federal Bureau of Investigation for partnering with ATF in sending a clear message that individuals committing violent acts in our communities will be held responsible for their actions."
Sentencing is scheduled for October 7, 2021 before Senior United States District Judge Norman A. Mordue. As a result of his conviction, Malek faces up to 10 years in prison, a fine of up to $10,000, and a term of supervised release of up to 3 years. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines and other factors. Malek has agreed to pay restitution in the amount of $3,000 to the owner of the vehicle. He has been in custody since his arrest on October 6, 2020.
This case was investigated by the ATF and the FBI’s Joint Terrorism Task Force, as well as the Schenectady Police and Fire Departments, and is being prosecuted by Assistant U.S. Attorneys Richard Belliss and Alexander Wentworth-Ping.
Sanford Man Pleads Guilty to Fentanyl Trafficking Conspiracy Resulting in DeathRead the Press Release
PORTLAND, Maine—A Sanford man pleaded guilty today in federal court to conspiracy to distribute 40 grams or more of fentanyl with death and serious bodily injury resulting, Acting U.S. Attorney Donald E. Clark announced.
According to court records, between August 2017 and April 2018, Scott Adams, 45, and other conspirators acquired fentanyl in Massachusetts for distribution in York County, Maine. Two people who obtained fentanyl distributed by members of the conspiracy died and another person suffered serious bodily injury.
On April 11, 2018, law enforcement officers seized about 150 grams of fentanyl from members of the conspiracy. An ensuing search of the defendant’s residence resulted in the seizure of fentanyl, a digital scale, approximately $2,500 in U.S. currency, and a “finger press” designed to compress fentanyl for further distribution.
As a result of the deaths and serious bodily injury, the defendant faces at least 20 years and up to life in prison and a fine of up to $5,000,000. He will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
This case was investigated by the U.S Drug Enforcement Administration and the Maine Drug Enforcement Agency, with assistance from the Biddeford and Sanford Police Departments.
This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
Rochester Food Truck Delivery Business and Principals to Pay Fine for Submitting False Claims for Payment to the SNAP ProgramRead 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 Groceries To Your Door, a Rochester food truck delivery business, its owner, Fotene (Tina) Boosalis, 54, and one of its operators, Boosalis’ son Christopher Musson, 22, both of Rochester, have agreed to pay $250,000 to resolve allegations that they violated the False Claims Act by submitting false and fraudulent claims for payment to the Supplemental Nutrition Assistance Program (“SNAP”), formerly known as the Food Stamp Program. The SNAP program is administered by the United States Department of Agriculture’s Food and Nutrition Service.
Assistant U.S. Attorney MaryEllen Kresse, who handled the case, stated that in April 2017, Groceries To Your Door was authorized to participate in the SNAP program. From the time it received authorization, the business operated in violation of the program’s rules and regulations by selling food to SNAP beneficiaries on credit and by obtaining payments for food purchases that never occurred. In order to perpetuate this scheme, Groceries To Your Door processed food purchases using manual food vouchers instead of an Electronic Benefit Transfer (EBT) machine. As a result, the business obtained protected beneficiary account information which it then used to debit beneficiaries’ SNAP accounts for food purchases that had occurred the previous month or not at all. The SNAP program reimbursed Groceries To Your Door based on its representations that the manual food voucher purchases had occurred and that the purchases had been processed according to SNAP rules and regulations. Groceries To Your Door ceased operation in February 2020, when its bank account was seized by law enforcement.
The settlement is the result of an investigation by the U.S. Department of Agriculture, Office of Inspector General, under the direction of Special Agent-in-Charge Bethanne M. Dinkins; Homeland Security Investigations, under the direction of Special Agent-in-Charge Kevin Kelly; the Monroe County Department of Social Services, under the direction of Commissioner Thalia Wright; and the New York State Office of Inspector General, under the direction of Inspector General Letizia Tagliafierro.
The claims resolved by the settlement are allegations only, and there have been no determinations of liability.
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Robeson County Cocaine Distributor Sentenced to More Than 17 Years ImprisonmentRead the Press Release
NEW BERN, N.C. – A Pembroke man was sentenced today to 210 months in prison for cocaine distribution.
According to court documents and other information presented in court, an investigation revealed that John Caulder, Jr., 38, had conspired with other Robeson County area individuals to distribute over one hundred kilograms of cocaine from 2014 through May of 2019. On May 1, 2019, law enforcement concluded the investigation by executing a search warrant at Caulder’s Pembroke residence. During the search, investigators located cocaine, crack, cash, and drug packaging material.
G. Norman Acker, III, Acting U.S. Attorney for the Eastern District of North Carolina made the announcement after sentencing by U.S. District Judge Louise W. Flanagan. The Robeson County Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms, and Explosives investigated the case and Assistant U.S. Attorney Caroline Webb 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. 7:20-CR-101-FL.
Raleigh Man Sentenced for Child Pornography Offense Following Investigation of Disturbing Online ChatsRead the Press Release
NEW BERN, N.C. – Cameron Hayes of Raleigh, was sentenced today to 108 months in prison for receipt of child pornography. On September 16, 2020, Hayes pled guilty to the charge.
According to court documents and statements made during hearings, in September 2019, the website MeetMe.com alerted the National Center for Missing and Exploited Children (NCMEC) that an individual with username beginning with “Jen” was engaging in suspicious activity on the website. Specifically, Jen had a conversion with another person on the MeetMe platform about receiving child pornography and engaging in sexual conduct with the other person’s 10-year-old niece. NCMEC determined that the user had an IP address in Raleigh and referred the tip to local law enforcement. Records showed the IP to be registered to the wife of defendant Cameron Hayes, at a residence in Raleigh. Apple Inc. confirmed that an email associated with the MeetMe account was registered to Hayes.
On January 7, 2020, members of the Federal Bureau of Investigation and Raleigh Police Department executed a search warrant at Hayes’ residence. Hayes confirmed his email account and told law enforcement that the chats about the 10-year-old were just fantasy. He admitted to unintentionally seeing child pornography but denied having any on his devices.
FBI conducted an on-site preview of various digital items and found numerous images of child pornography on Hayes’ cell phone. A full forensic review of seized items uncovered 875 images and over 200 videos depicting child abuse material on Hayes’ phone and laptop. Some files depicted prepubescent children.
G. Norman Acker, III, Acting U.S. Attorney for the Eastern District of North Carolina made the announcement after sentencing by U.S. District Judge Louise W. Flanagan. The Federal Bureau of Investigation and Raleigh Police Department conducted the investigation. Assistant U.S. Attorney Jake D. Pugh prosecuted the case.
This case was part of the Project Safe Childhood initiative, a national program aimed at ensuring that criminals exploiting children are effectively prosecuted by making full use of all available law enforcement resources at every level. For more information about this important national project, Project Safe Childhood, go to www.projectsafechildhood.gov.
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. 5:20-cr-0227-FL.
Operation Second Wave Update: Two More Defendants Sentenced to Federal Prison for Methamphetamine ConspiracyRead the Press Release
CHARLESTON, W.Va. – Two defendants charged as a result of a long-term investigation known as “Second Wave” were sentenced this week to federal prison for conspiracy to distribute methamphetamine. Larry Terrence Martin, 31, of St. Albans and Carol Lynn Belton, 62, of Montgomery were sentenced to 151 months and 15 months in prison, respectively.
According to court documents, Martin previously admitted distributing more than 10 pounds of methamphetamine and 60 pounds of marijuana between January 2018 and August 26, 2020 to both dealers and users in and around Kanawha County, West Virginia. Martin also admitted recruiting a U.S. Postal Service employee to deliver drug packages to him that had been sent to residences along the mail carrier’s route. Belton previously admitted distributing approximately seven ounces of methamphetamine in Montgomery, West Virginia.
This case was part of operation “Second Wave,” a long-term investigation of a drug trafficking ring involved in the distribution of methamphetamine, cocaine, heroin, marijuana, and THC products. More than a dozen individuals have been charged in federal court as part of the investigation. All have pled guilty.
Acting United States Attorney Lisa G. Johnston made the announcement and commended the investigative work of the Federal Bureau of Investigation (FBI), the Central West Virginia Drug Task Force, the United States Postal Inspection Service (USPIS), the United States Postal Service – Office of Inspector General (USPS-OIG), the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the Drug Enforcement Administration (DEA), the Kanawha County Sheriff’s Office (KCSO), the Metropolitan Drug Enforcement Network Team (MDENT) and the Charleston Police Department.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 2:20-cr-00154 (Martin et al).
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Old Forge Borough Council President Charged with BriberyRead the Press Release
SCRANTON- The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Robert Semenza, Jr., age 47, of Old Forge, Pennsylvania, was charged in a criminal information with federal program bribery.
According to Acting United States Attorney Bruce D. Brandler, the information alleges that Semenza, the President of the Old Forge Borough Council, solicited, demanded, and accepted cash payments in exchange for performing and promising to perform official acts, between January 2019 and February 2020. In particular, the official acts were in connection with a civil litigation filed by Old Forge Borough against a local business owner, in a dispute over Old Forge zoning ordinances. Semenza allegedly agreed, in exchange for cash payments, to vote on the local business owner’s behalf in matters before the Old Forge Borough Council, to advocate on behalf of the local business owner with the Old Forge Borough Council, the Old Forge Borough Solicitor, and Old Forge zoning officials, and to propose a favorable resolution for the civil litigation to the Old Forge Borough Council and Solicitor, among other things.
“When public officials use their office to line their pockets rather than serve the public it not only constitutes a serious crime but also breeds cynicism and undermines the electorate’s faith in government,” stated Acting United States Attorney Bruce D. Brandler. “Our office and the FBI’s public corruption task force are committed to rooting out all public corruption in the Middle District and will commit all necessary resources to that task.”
The case was investigated by the Scranton Federal Bureau of Investigation’s Public Corruption Task Force, which consists of members of the Pennsylvania State Police and the Pennsylvania Attorney General’s Office, and federal agents from the FBI and Internal Revenue Service. Assistant U.S. Attorney Phillip J. Caraballo is prosecuting the case.
Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law for this offense is 10 years of imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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North Country Hunting Guide Pleads Guilty to Hunting Waterfowl over BaitRead the Press Release
SYRACUSE, NEW YORK - William “Bill” Saiff III, age 57, of Henderson, New York, pled guilty today to a felony violation of the Lacey Act for hiring guides to lead paying hunters on illegal waterfowl hunts over baited ponds. The guilty plea was announced by Acting United States Attorney Antoinette T. Bacon; Ryan Noel, Regional Special Agent in Charge, U.S. Fish and Wildlife Service, Office of Law Enforcement; and Bernard Rivers, Director of Law Enforcement, New York State Department of Environmental Conservation.
Saiff is a professional hunting guide and fishing charter captain whose website advertises that for eighteen years he “hosted the popular hunting and shooting sports program Cabin Country as seen on Public Television Stations across the country.” In pleading guilty, Saiff admitted that in 2018 he repeatedly baited ponds in Jefferson County and sent hunting guides and paying clients to hunt wild ducks over those ponds while they were baited. Saiff admitted that he violated the Lacey Act by charging a total of more than $350 for hunts in which he knew the wild ducks killed by the hunters were taken over bait in violation of the Migratory Bird Treaty Act (“MBTA”). According to the plea agreement, Saiff charged each hunter $300 per day of hunting, and the four illegal guided hunts to which he admitted in the plea agreement involved a total of 17 hunters.
Saiff also admitted that he was on federal probation when he committed these offenses in 2018, having been convicted in federal court in Syracuse in 2017 for guiding illegal waterfowl hunts over bait in violation of the MBTA. Saiff faces separate charges for violating the terms of his probation for the offenses to which he pled guilty today.
At sentencing, Saiff faces up to 5 years in prison, a fine of up to $250,000, and a term of supervised release of up to 3 years. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines and other factors. Saiff will be sentenced on October 7, 2021, by Senior United States District Judge Norman A. Mordue, who presides over the criminal case. The supervised release violations are pending before United States Magistrate Thérèse Wiley Dancks.
This case is being investigated by U.S. Fish and Wildlife Service, Office of Law Enforcement, and the New York State Department of Environmental Conservation, Division of Law Enforcement, and it is being prosecuted by Assistant U.S. Attorney Michael F. Perry.
New Orleans Man Sentenced for Violating Federal Controlled Substances ActRead the Press Release
NEW ORLEANS, LOUISIANA – U.S. Attorney Duane A. Evans announced that on June 8, 2021, CHRISTOPER BONDY, age 40, a resident of New Orleans, Louisiana, was sentenced to 63 months imprisonment by United States District Court Judge Wendy B. Vitter for attempting to possess with the intent to distribute 500 grams or more of cocaine. Additionally, BONDY was ordered to serve 4 years of supervised release and pay a $100 special assessment fee. No fines were imposed in this case.
According to court documents, BONDY set up a deal to purchase four kilograms of cocaine from undercover agents. During the drug deal, BONDY gave the undercover agents $49,960 in cash in exchange for the cocaine. BONDY was subsequently arrested.
The case was investigated by the Department of Homeland Security and the Jefferson Parish Sheriff’s Office. Assistant United States Attorney Bayonle Osundare prosecuted this case.
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New Jersey Man Sentenced to 11 Years’ Imprisonment for Heroin TraffickingRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Anthony McCoy, a/k/a “Hard Times,” age 36, of New Jersey, was sentenced on June 8, 2021, by United States District Court Judge Robert D. Mariani to 132 months’ imprisonment for drug trafficking.
According to Acting United States Attorney Bruce D. Brandler, McCoy pleaded guilty to a heroin trafficking conspiracy, and admitted that he was responsible for the distribution and possession with intent to distribute between 1 kilogram and 3 kilograms of heroin between August 2016 and February 2018. One kilogram of heroin is the equivalent of approximately 40,000 individual doses. After serving his term of imprisonment, McCoy must serve an additional four years under supervised release.
The case was investigated by the Federal Bureau of Investigation and the Stroud Area Regional Police Department. Assistant U.S. Attorney Sean A. Camoni is prosecuting the case.
This case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.
This case is part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local and tribal enforcement and the local community to develop effective, locally-based strategies to reduce crime.
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New Haven Man Pleads Guilty to Federal Gun ChargeRead the Press Release
Leonard C Boyle, Acting United States Attorney for the District of Connecticut, announced that ERICK E. GOMEZ, JR., 28, of New Haven, pleaded guilty today before U.S. District Judge Kari A. Dooley in Bridgeport to possession of a firearm in furtherance of a drug trafficking crime.
According to court documents and statements made in court, on April 3, 2020, Gomez fled from his car after he was involved in a car accident in Woodbridge. A search of the car revealed a loaded .380 semi-automatic pistol, 15 baggies of crack cocaine and 12 folds of heroin and fentanyl. Gomez was subsequently charged with state offenses stemming from this incident and was released on bond. On July 31, 2020, Gomez was arrested on related federal charges. At the time of his arrest he possessed quantities of crack cocaine, heroin/fentanyl and methamphetamine.
Judge Dooley scheduled sentencing for September 2, 2021, at which time Gomez faces a mandatory minimum term of imprisonment of at least five years.
Gomez has been detained since his federal arrest.
This investigation is being conducted by the Federal Bureau of Investigation, New Haven Police Department and Woodbridge Police Department. The case is being prosecuted by Assistant U.S. Attorneys Anthony E. Kaplan, Peter D. Markle and Tara E. Levens.
New Hampshire Roofing Contractor Pleads Guilty to Filing a False Tax ReturnRead the Press Release
BOSTON – A New Hampshire roofing contractor pleaded guilty yesterday in federal court in Boston in connection with failing to report income from his roofing and siding business to the Internal Revenue Service (IRS).
Ronald McPhail, 53, of Windham, N.H., pleaded guilty to one count of filing a false tax return. U.S. Senior District Court Judge George A. O’Toole Jr. scheduled sentencing for Oct. 7, 2021.
McPhail owed more than $700,000 in income taxes to the IRS after he failed to report more than $7.1 million in revenue and approximately $2.43 million in income from his roofing and siding business on his federal tax returns for tax years 2014 through 2019. To conceal his scheme, McPhail cashed customer checks without first depositing them and withheld information concerning these checks and other business revenues from his tax preparers.
The charge of filing a false tax return provides for a sentence of up to three years in prison, 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 and Ramsey E. Covington, Acting Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston made the announcement today. Assistant U.S. Attorney Seth B. Kosto, Deputy Chief of Mendell’s Securities, Financial & Cyber Fraud Unit, is prosecuting the case.
New Castle Man Charged with Possessing Cocaine in Early 2020Read the Press Release
PITTSBURGH, PA - A resident of New Castle, Pennsylvania, has been indicted by a federal grand jury in Pittsburgh on charges of violating federal narcotics laws, Acting United States Attorney Stephen R. Kaufman announced today.
The two-count Indictment named Donte Calhoun, age 31, as the sole defendant.
According to the Indictment, on January 21, 2020, and February 11, 2020, Calhoun possessed with the intent to distribute a quantity of cocaine.
The law provides for a maximum total sentence of 20 years in prison, a fine of $1,000,000 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Brendan T. Conway is prosecuting this case on behalf of the government.
The Pennsylvania State Police and the Drug Enforcement Administration conducted the investigation leading to the Indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
New Bedford Man Pleads Guilty to Being Felon in Possession of Firearm and AmmunitionRead the Press Release
BOSTON – A New Bedford man pleaded guilty yesterday in federal court in Boston to illegally possessing a Mustang .380 pistol and ammunition.
Victor Morales, 35, pleaded guilty to one count of possessing a firearm and ammunition while being a convicted felon. U.S. District Court Judge Patti B. Saris scheduled sentencing for Sept. 10, 2021. Morales was indicted by a federal grand jury in November 2020.
On approximately July 20, 2020, Morales possessed a Colt MK IV Mustang .380 loaded pistol and 12 rounds of .380 caliber ammunition in his apartment. Federal law prohibits Morales from possessing a firearm or ammunition due to a prior felony conviction.
The charge of being a convicted felon in possession of a firearm and ammunition provides for a sentence of up to 10 years in prison, up to three years of supervised release and a fine of up to $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; Kelly D. Brady, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Boston Field Division; and New Bedford Police Chief Joseph C. Cordeiro made the announcement today. Assistant U.S. Attorneys Kenneth G. Shine and Evan Gotlob of Mendell’s Major Crimes Unit are prosecuting the case.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
Nacogdoches Felon Sentenced for Federal Drug Trafficking and Firearms ViolationsRead the Press Release
BEAUMONT, Texas – A Nacogdoches man has been sentenced to federal prison for drug trafficking and firearms violations in the Eastern District of Texas, announced Acting U.S. Attorney Nicholas J. Ganjei.
Marcus Bernard Tutt, 42, pleaded guilty on Jan. 27, 2021, to possession with intent to distribute methamphetamine and use of a firearm during a drug trafficking crime and was sentenced to 222 months in federal prison today by U.S. District Judge Michael J. Truncale.
“Methamphetamine abuse has a tremendously negative effect on our local communities, touching upon every facet of our daily lives” said Acting U.S. Attorney Nicholas J. Ganjei. “Ensuring the health and safety of East Texas begins with prosecutions like this case, and you can expect EDTX to maintain its aggressive posture in prosecuting meth trafficking.”
According to information presented in court, on Nov. 25, 2019, Tutt was stopped by a trooper with the Texas Department of Public Safety for a traffic violation and was arrested for driving without a valid license. During a subsequent search of Tutt’s vehicle, the trooper located 100 grams of methamphetamine and a revolver. Tutt has numerous prior felony convictions, including possession of a controlled substance, credit card abuse, unlawful possession of a firearm by a felon, attempted obstruction, forgery, aggravated assault with a deadly weapon, and multiple convictions for delivery of a controlled substance. As a convicted felon, Tutt is prohibited from owning or possessing firearms or ammunition. Tutt was indicted by a federal grand jury on August 19, 2020.
This case was prosecuted as part of the joint federal, state, and local Project Safe Neighborhoods (PSN) Program, the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Texas Department of Public Safety and the Angelina County Sheriff’s Office and prosecuted by Assistant U.S. Attorney Donald S. Carter.
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Montgomery Resident Convicted on All Counts at Trial in Financial Fraud CaseRead the Press Release
United States Attorney Sean P. Costello of the Southern District of Alabama announces that a federal jury in Montgomery, Alabama found defendant Tiffany Culliver Franklin, 41, of Montgomery, guilty on all charges in a financial fraud case. Chief United States District Judge L. Scott Coogler presided over the trial, which started on June 7, 2021 and ended the following day. Franklin is scheduled to be sentenced in the fall of 2021.
On April 7, 2021, a federal grand jury for the Middle District of Alabama charged Franklin with violations of 18 U.S.C. §§ 656 (theft or embezzlement by a bank employee) and 1344(1) (bank fraud), which carry a maximum potential sentence of 30 years, and 18 U.S.C. § 1343 (wire fraud), which carries a maximum potential sentence of 20 years.
The jury heard evidence that between June 2015 and July 18, 2017, Franklin was a vault teller with Branch Banking and Trust Company (BB&T), working at a local branch in Montgomery. An internal audit revealed that the vault drawers under Franklin’s control were short $202,000. Franklin gave a written statement to a bank investigator in which she expressed remorse for her conduct and admitted to embezzling $202,000 from the bank.
The jury also heard evidence that from January 2012 to December 2014, Franklin was employed as a personal banker at a Wells Fargo branch in downtown Montgomery. In October 2014, Franklin used her Wells Fargo credentials to create and obtain a debit card to make numerous ATM check deposits into and immediate cash withdrawals from an elderly customer’s account. A Wells Fargo investigator interviewed Franklin, who admitted that she had issued the debit card in the elderly customer’s name and had been using ATMs to deposit checks from her own bank account into the customer’s Wells Fargo account.
Finally, the jury heard evidence that from September 2017 to June 2018, Franklin worked as a bookkeeper at Goodwyn Middle School (GMS) in Montgomery. Evidence introduced at trial established that during her time as GMS’s bookkeeper, Franklin stole at least $13,216 in money and property that belonged to GMS. She stole $6,995 in money taken in by GMS that should have been deposited into the school’s bank account. Franklin also diverted for her personal benefit $675 taken in by GMS through gate receipts at various athletic events and $3,074 taken in by GMS from various classroom teachers. Moreover, Franklin withdrew from and failed to redeposit into GMS’s bank account $2,400 meant for use at various GMS athletic events. Finally, Franklin used a GMS-issued Walmart Community Card to make unauthorized purchases of various personal items, including Walmart gift cards. In September 2019, during an interview with investigators from the Alabama Attorney General’s Office, Franklin confessed to stealing GMS’s money and gambling with it at casinos.
The United States Secret Service and the Alabama Attorney General’s Office investigated the case. Assistant United States Attorneys Sinan Kalayoglu and Justin Roller are prosecuting the case.
Middletown Man Sentenced to Six Months of Home Confinement for Damaging Former Employer's Computer NetworkRead the Press Release
WILMINGTON, Del. – David C. Weiss, United States Attorney for the District of Delaware, announced today that Levii Delgado, 36, of Middletown, was sentenced today to six months of home confinement and over $13,000 in restitution by the Honorable Leonard P. Stark, Chief United States District Judge for the District of Delaware. Delgado pled guilty in February 2021 to one count of causing damage to a protected computer.
According to court documents, Delgado worked as an Information Technology (IT) administrator at a medical center that provides care to under-served communities. The medical center terminated Delgado’s employment in August 2017. Following that termination, Delgado was no longer authorized to access the medical center’s computer network and his credentials that had allowed him to access the medical center’s network were disabled. Four days after his termination, Delgado connected a personal laptop to the medical center’s computer network through an administrator account that Delgado continued to use without authorization. Once Delgado gained unauthorized access to the computer network, he caused the deletion of the medical center’s employee user accounts, the disabling of its computer accounts, and the deletion of its file server. Delgado’s actions prevented the medical center’s employees from logging into their computers and accessing patient files necessary to conduct operations. As a result, the medical center’s ability to see and treat its patients was impaired.
No patient information was compromised or accessed as a result of Delgado’s actions.
U.S. Attorney Weiss stated, “The defendant abused his knowledge of his former employer’s computer network to deliberately disrupt the medical center’s capability to conduct business. As a result, the defendant directly impeded that entity’s ability to provide medical care to the communities it serves, putting patients at risk. My office is committed to prosecuting any individual who thinks attacking a former employer’s computer network is an acceptable reaction to getting fired.”
“What Mr. Delgado did was not only intentional, reckless and petty, but also caused a severe disruption in medical care in an underserved community,” said Rachel Byrd, Acting Special Agent in Charge of the FBI Baltimore Field Office. “Computer intrusion is a crime and the FBI, and our law enforcement partners, will continue to pursue those who compromise, mishandle or disrupt computer networks.”
This case was investigated by the FBI-Baltimore Division’s Cyber Task Force and was prosecuted by Assistant U.S. Attorney Jesse S. Wenger.
Cyberattacks are on the rise. A private sector entity that is a victim of a cyber incident can receive assistance from government agencies, which are prepared to investigate the incident, mitigate its consequences, and help prevent future incidents. Federal Government agencies work together to leverage their collective response expertise, apply their knowledge of cyber threats, preserve key evidence, and use their combined authorities and capabilities to minimize asset vulnerability and bring malicious actors to justice. Private sector entities are encouraged to report a cyber incident to the FBI at 1-800-CALLFBI (225-5324) or file a complaint with the Internet Crime Complaint Center (IC3) at www.ic3.gov.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the District of Delaware. Related court documents and information is located on the website of the District Court for the District of Delaware or on PACER.
Middleboro Financial Advisor Charged with Theft of Clients' Retirement AssetsRead the Press Release
BOSTON – A Middleboro financial advisor was arrested and charged today with defrauding elderly clients and stealing retirement assets.
Paul R. McGonigle, 65, was charged with three counts of wire fraud, one count of mail fraud and one count of aggravated identity theft. McGonigle made his appearance today before U.S. District Court Magistrate Judge Donald L. Cabell.
According to the charging document, McGonigle served as a financial advisor for the victims. Beginning in July 2018, McGonigle allegedly caused unauthorized withdrawals from victims’ annuities and induced victims to give him money to invest on their behalf, which he then used for personal and business expenses. To carry out his scheme, McGonigle allegedly posed as clients on calls with their annuity companies and signed their names on forms requesting withdrawals from their annuities.
The charges of mail and wire fraud provide for a sentence of up to 20 years in prison, three years of supervised release and a fine of up to $250,000 or twice the gross gain or loss from the offense, whichever is greater. The charge of aggravated identity theft provides for a mandatory consecutive sentence of two years in prison, up to one year of supervised release and a fine of $250,000 or twice the gross gain or loss from the offense, whichever is greater. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney Nathaniel R. Mendell and Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division made the announcement. The Massachusetts Insurance Fraud Bureau provided valuable assistance with the investigation. Assistant U.S. Attorney Kristen A. Kearney of Mendell’s Securities, Financial & Cyber Fraud Unit is prosecuting the case.
Michigan Man Admits Defrauding Business Opportunity Buyers of More Than $5 MillionRead the Press Release
CAMDEN, N.J. – A Michigan man today admitted defrauding victims of more than $5 million in connection with the sale of medical-related business opportunities, Acting U.S. Attorney Rachael A. Honig announced.
Vijay Reddy, 45, of Milan, Michigan, pleaded guilty before U.S. District Judge Robert B. Kugler to an information charging him with one count of conspiracy to commit wire fraud and one count of wire fraud.
According to documents filed in this case and statements made in court:
From December 2015 through November 2020, Reddy and his conspirators, David Weinstein and Kevin Brown, advertised business opportunities for sale on various websites. They purported to sell “blocks” of contracts with medical providers who allegedly wanted to outsource their medical billing, collections, appeals, answering, credentialing, or transcription functions. The buyers would then provide the contracted services to the medical providers and earn a profit. The conspirators promised to deliver a specified number of providers and pledged that their proprietary marketing efforts would provide a guaranteed client base to the buyers.
To induce buyers to purchase the business opportunities, the conspirators created fake references purporting to be buyers who vouched for their prior business purchases from the conspirators. In fact, the references were Reddy, Weinstein, and their friends and family members, and they used aliases and disguised phone numbers to speak with potential buyers.
After agreeing to purchase the blocks of medical providers, victims entered contracts with companies represented by Weinstein or Reddy and wired down payments ranging from $15,000 to $240,000 to accounts controlled by Weinstein or Brown. The remainder of each purchase price was payable when the conspirators fulfilled the contract by delivering the agreed-upon number of providers.
After receiving the down payments, Weinstein and Reddy typically delivered to each victim only a small number of medical providers. Despite not fulfilling the contracts of any of the buyers identified by law enforcement, the conspirators continued to sell blocks of medical providers to new buyers and refused to provide refunds for their failures to satisfy the terms of the contracts. The conspirators also periodically sold batches of previously signed contracts and disclaimed further responsibility for those contracts to insulate themselves from complaints or legal action from disgruntled buyers.
Brown acted as the business broker for most of the transactions and received a commission for the sales he brokered. Reddy or Weinstein acted as the seller and signed the contracts with the victims. At least 77 victims sent more than $5 million to accounts controlled by the conspirators. The conspirators spent the victims’ money on personal expenses, including a travel, jewelry, real estate, a wedding and a college education, and other business investments.
The wire fraud and wire fraud conspiracy counts are each punishable by a maximum of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense, whichever is greater. As part of his plea agreement, Reddy agreed to make restitution $5 million. Sentencing is scheduled for Oct. 20, 2021.
Acting U.S. Attorney Honig credited special agents of the FBI’s South Jersey Resident Agency, under the direction of Special Agent in Charge Michael J. Driscoll in Philadelphia; special agents of IRS - Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez in Newark; and postal inspectors of the U.S. Postal Inspection Service, under the direction of Inspector in Charge Damon Wood in Philadelphia, with the investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorneys Daniel A. Friedman and Diana V. Carrig of the U.S. Attorney’s Office in Camden.
The charges and allegations in the criminal complaints against Weinstein and Brown are merely accusations, and they are presumed innocent unless and until proven guilty.
Man Charged for Alleged Involvement in a 2019 Delaware County MurderRead the Press Release
A Delaware County man faces a murder conspiracy charge in federal court after his state case was dismissed in March due to lack of jurisdiction, announced Acting U.S. Attorney Clint Johnson.
Cody Buzzard, 27, was charged Tuesday by Criminal Complaint with conspiracy to murder in Indian Country. The crime was committed on the Cherokee Nation reservation.
A Complaint is a temporary charge alleging violation of the law. Defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law. For the case to proceed to trial, the United States must present the charge to a federal Grand Jury within 30 days. Once a Grand Jury returns an Indictment, a defendant has a right to a jury trial at which time the United States would have the burden of proving the defendant’s guilt.
On Aug. 1, 2019, the Delaware County Sheriff’s Office responded to a 911 call reporting a shooting near Jay. Deputies discovered Jerry Wayne Tapp deceased in his front yard. It appeared that Tapp sustained multiple gunshot wounds to his body and that a second victim had sustained a gunshot wound to her arm. According to the affidavit accompanying the Complaint, the victim told investigators that she heard a noise outside the home early on Aug. 1 and thought that Tapp had forgotten his keys to the house. She then turned on the light and opened the door. She heard gunfire and felt a sudden pain in her right wrist then shut and locked the front door, crawled to another room, and called 911. The witness explained that she saw a white 4-door car that did not belong to the victims and Tapp’s truck before shutting the door. When officers arrived both vehicles were gone. During a crime scene investigation, OSBI agents discovered approximately 12, .22 caliber spent casings in the yard.
In the affidavit, Cody’s brother Dakota Buzzard and father James Buzzard are implicated as being possible participants in the murder conspiracy.
At 9:30 am the day of the crime, Dakota was located by deputies from the McDonald County Sheriff’s Office while driving a white 4-door Altima matching the victim’s description. OSBI agents later found four .22 caliber spent casings inside the vehicle and a .22 caliber rifle and bullets located behind a section of drywall in another individual’s residence who allegedly hid the firearm for the Buzzards. During the investigation, the shell casings found at the scene of the crime were identified as having been fired by the .22 caliber rifle.
Witnesses to events following the murder claimed they overheard conversations stating that someone had been killed, that Dakota and his brother Cody had killed someone, that Cody was disposing of a pickup, and that James Buzzard had allegedly spoken about being involved.
On Aug. 6, 2019, investigators obtained Cody’s Facebook records after a search warrant was served. The day before the shooting Cody allegedly made inquiries using Facebook about getting a vehicle and firearm. He allegedly indicated that he “had business to tend to,” and he was going to “take care of a problem.”
The FBI, Oklahoma State Bureau of Investigation (OSBI), Delaware County Sheriff’s Office, and McDonald County Sheriff’s Office are the investigative agencies. Assistant U.S. Attorneys Ben Tonkin and Victor Régal are prosecuting the case.
Malden Woman Sentenced for Stealing Social Security Benefits and Bank EmbezzlementRead the Press Release
BOSTON – A Malden woman was sentenced today for stealing Social Security benefits and embezzling over $27,000 from a bank.
Materesa Jose, 53, was sentenced by U.S. District Court Judge Leo T. Sorokin to time served (one day in prison) and three years of supervised release. Jose also was ordered to pay $27,605 in restitution. On Feb. 9, 2021, Jose pleaded guilty to one count of theft of public funds and one count of bank embezzlement.
While an employee of Eastern Bank, Jose, through a series of checks and electronic fund transfers, stole approximately $27,605 from the bank between September 2017 and July 2018. The majority of the stolen funds consisted of Social Security benefits. The account from which she stole the money belonged to an individual who had died in 2015.
Acting United States Attorney Nathaniel R. Mendell; Tonya Perkins, Special Agent in Charge of the Social Security Administration, Office of Inspector General, Office of Investigations, Boston Field Division; and William S. Walker, Acting Special Agent in Charge of Homeland Security Investigations in Boston made the announcement today. Special Assistant U.S. Attorney Karen Burzycki of Mendell’s Major Crimes Unit prosecuted the case.
Lawrence Resident Sentenced to 30 Years in Prison for Child Exploitation OffensesRead the Press Release
BOSTON – A Lawrence resident was sentenced today for sexually exploiting two children under four years of age.
Jakob Nieves, who also goes by the name Dakota, 21, was sentenced by U.S. District Court Judge Denise J. Casper to 30 years in prison and five years of supervised release. In August 2020, Nieves pleaded guilty to two counts of sexual exploitation of children, one count of distribution of child pornography and one count of possession of child pornography.
As part of an investigation into the use of Kik messenger for the trade of child pornography, an undercover agent communicated with Nieves via Kik. During the course of those communications, Nieves told the agent about the ways that she sexually abused two children known to her, and sent the undercover agent images and videos that Nieves had produced, which depicted Nieves sexually abusing one of those children.
On Aug. 14, 2019, when agents searched Nieves’s home, she admitted to distributing images and videos of child pornography to a user she met in a Kik group geared toward individuals interested in pedophilia. Forensic analysis of Nieves’ cell phone revealed pornographic images and videos of two children known to Nieves, both of whom were under the age of four, as well as thousands of child pornography images depicting at least 175 victims personally unknown to Nieves.
Acting United States Attorney Nathaniel R. Mendell and Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division made the announcement today. Assistant U.S. Attorney Anne Paruti, Deputy Chief of the Major Crimes Unit and Mendell’s Project Safe Coordinator, prosecuted the case.
The case is brought as part of Project Safe Childhood. In 2006, the Department of Justice created Project Safe Childhood, a nationwide initiative designed to protect children from exploitation and abuse. Led by the U.S. Attorneys’ Offices and the DOJ’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who exploit children, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov/.
Lawrence Man Sentenced for Fentanyl OffensesRead the Press Release
BOSTON – A Lawrence man was sentenced yesterday in federal court in Boston for distributing and possessing fentanyl.
Jose A. Ventura, 39, was sentenced by U.S. District Court Judge William G. Young to time served (approximately two months in prison), five months of home confinement and three years of supervised release. In November 2019, Ventura pleaded guilty to one count of distribution of and possession with intent to distribute fentanyl.
On July 16, 2019 in Lawrence, investigators witnessed Ventura sell approximately 10 grams of fentanyl in a street-level drug transaction. When investigators subsequently approached Ventura, he threw five additional bags of fentanyl on the ground. The total amount of fentanyl attributable to Ventura was nearly 15 grams.
Ventura was indicted as part of a coordinated enforcement operation in the Merrimack Valley dubbed “Devil’s Highway.” The operation targeted the distribution of opioids, including fentanyl and heroin, and resulted in charges against 40 people for federal drug offenses, with at least a dozen more individuals facing state charges.
Acting United States Attorney Nathaniel R. Mendell and Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division made the announcement. Valuable assistance was provided by the Drug Enforcement Administration, the Massachusetts State Police, the Lawrence Police Department and the North Andover Police Department. Assistant U.S. Attorney Lindsey Weinstein of Mendell’s Narcotics & Money Laundering Unit prosecuted the case.
KC Man Charged with Drug Trafficking, Illegal Firearms After 911 CallRead the Press Release
KANSAS CITY, Mo. – A Kansas City, Missouri, man who called 911 to aid his mother was charged in federal court today after police officers responded to their residence and found evidence of drug trafficking and illegal firearms.
Michael Cummings II, 39, was charged with possessing methamphetamine with the intent to distribute and with possessing firearms in furtherance of drug trafficking in a complaint filed in the U.S. District Court in Kansas City, Mo. Cummings remains in federal custody pending a detention hearing on June 14.
According to an affidavit filed in support of today’s federal criminal complaint, police officers were called to Cummings’s residence on Monday night, June 7, when Cummings called 911 for emergency medical assistance for his mother. Emergency personnel attempted lifesaving measures on Cummings’s mother but she was unresponsive, and pronounced dead at approximately 12:04 a.m. on Tuesday, June 8.
Officers saw a loaded Heckler & Koch .40-caliber handgun on the dining room table, next to a pile of cash, and an SKS-style assault rifle with a magazine leaning against the wall of a stairwell. Officers arrested Cummings, who is a convicted felon, for illegally possessing the firearms.
Officers then obtained a warrant and searched the residence. In addition to the two firearms, officers also seized $618 found on the table and under the couch cushion.
In one bedroom, officers found a Pioneer Arms 7.62 x 39mm AKM-47-style pistol in the closet, a baggie that contained .24 grams of a fentanyl/heroin compound, baggies that contained a total of 351.37 grams of methamphetamine, two plastic baggies that contained a total of 28.1 grams of crack cocaine, a baggie that contained marijuana, and approximately $3,512 in cash.
In another bedroom, officers found a Ruger .22-caliber pistol on a shelf.
In another bedroom, officers found a Smith and Wesson AR-15 style assault rifle in the closet and a safe that contained $175,100 in cash and a Ruger revolver that had previously been reported as stolen.
The charges contained in this complaint are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Trey Alford. It was investigated by the FBI and the Kansas City, Mo., Police Department.
Jury Convicts New Jersey Man of Attempted Possession of Nearly Two Kilograms of FentanylRead the Press Release
BOSTON – A New Jersey man was found guilty by a federal jury in Boston on Friday, June 4, 2021 in connection with attempting to retrieve narcotics from two Stoughton storage units.
Carlos Miguel Concepcion-Guilam, 30, was convicted following a three-day trial of one count of attempted possession with intent to distribute 400 grams or more of fentanyl. U.S. District Court Judge William G. Young scheduled sentencing for Oct. 5, 2021.
On June 19, 2019, staff at a storage facility in Stoughton opened a storage unit to auction its contents and found drug paraphernalia inside. During a search of that unit and a second, related storage unit, nearly two kilograms of fentanyl, nearly a kilogram of cocaine and drug-distribution paraphernalia including cutting agents, blenders and packaging materials were recovered. Agents began surveilling the units to identify the owner of the drugs.
On June 20, 2019, Concepcion-Guilam arrived at the storage facility and opened the door to the unit that previously had contained nearly three kilograms of narcotics. After seeing that the drugs had been seized, he sprinted away from the storage facility and attempted to flee in his vehicle. Concepcion-Guilam deliberately crashed his vehicle into a marked police cruiser before he was arrested.
The charge of attempted possession with intent to distribute 400 grams or more of fentanyl provides for a mandatory minimum sentence of 10 years and up to a lifetime in prison, five years and up to a lifetime of supervised release and a fine of $10 million. 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; Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration, New England Division; and Stoughton Police Chief Donna McNamara made the announcement today. Special assistance was provided by the Massachusetts State Police. Assistant U.S. Attorneys Stephen Hassink, Lauren Graber and Benjamin Tolkoff of Mendell’s Narcotics and Money Laundering Unit prosecuted the case.
Jury Convicts Cedar Rapids Man of Child Sexual Exploitation OffensesRead the Press Release
A man who sexually exploited two girls and committed child pornography offenses was convicted by a jury today after a two-and-a-half-day trial in federal court in Cedar Rapids.
Nathan Nosley, age 30, of Cedar Rapids, was convicted of sexual exploitation of children, distribution of child pornography, receipt of child pornography, three counts of possession of child pornography, and accessing child pornography.
The evidence at trial showed that, between 2018 and 2020, Nosley persuaded, induced, and enticed two girls to produce and send him pornographic images of themselves. Nosley also distributed child pornography to others, used cell phone apps to receive child pornography, used a cell phone to access child pornography, and possessed child pornography on a cell phone, on a memory card, and in an e-mail account.
Sentencing before United States District Court Judge C.J. Williams will be set after a presentence report is prepared. Nosley remains in custody of the United States Marshal pending sentencing. Nosley faces a mandatory minimum sentence of 15 years’ imprisonment and a possible maximum sentence of 150 years’ imprisonment, a $1,750,000 fine, $188,700 in special assessments, and supervised release for 5 years to life following any imprisonment.
This case is being prosecuted by Assistant United States Attorney Mark Tremmel and was investigated by the Iowa Division of Criminal Investigation, Homeland Security Investigations, the Iowa State Patrol, and the Marion Police Department.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is CR 20-101.
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Indiana man pleads guilty to sex trafficking conspiracyRead the Press Release
ALBUQUERQUE, N.M. – Matthew “Stacks” Woods, 32, of Indiana, pleaded guilty in federal court on June 8 to conspiracy to commit sex trafficking by means of force, threats, fraud and coercion and aiding and abetting. Woods will remain in custody pending sentencing.
Woods and his co-conspirators, Cornelius “Chip” Galloway, and Marcus “Taylor Made” Taylor, were charged in a superseding indictment on Dec. 3, 2019, with seven counts of sex trafficking, conspiracy to commit sex trafficking and attempted sex trafficking. The charges included two counts of sex trafficking of minors.
In his plea agreement, Woods admitted to his part in the conspiracy to recruit, maintain, advertise, and transport victims for the purpose of prostitution. The victims were expected to work when they were told, with no say over their hours, fees or the locations in which they were to perform sex acts. The victims were not allowed to keep any of the money paid for their services.
According to the plea, Galloway was the leader of the organization, Taylor transported the victims, and Woods physically punished victims for non-compliance.
Woods faces 15 to 18 years in prison, up to lifetime supervised release, and will be required to register as a sex offender. His sentencing date has not been set.
Galloway pleaded guilty on March 17, 2020, and was sentenced on Aug. 4, 2020, to 17 years in prison followed by 10 years of supervised release. Taylor pleaded guilty on May 21, 2020 and was sentenced on May 21, 2021 to eight years in prison followed by 10 years supervised release. Both are required to register as sex offenders.
The Homeland Security Investigations and the Albuquerque Police Department investigated this case with assistance from the Bernalillo County Sheriff’s Office. Assistant U.S. Attorneys Jack E. Burkhead and Letitia C. Simms are prosecuting the case.
Harrison County woman sentenced for methamphetamine and heroin distributionRead the Press Release
CLARKSBURG, WEST VIRGINIA – Stephanie Cottrill, of Shinnston, West Virginia, was sentenced today to 77 months of incarceration for methamphetamine and heroin distribution, Acting U.S. Attorney Randolph J. Bernard announced.
Cottrill, age 38, pleaded guilty in September 2020 to one count of “Conspiracy to Possess with Intent to Distribute and Distribute Methamphetamine and Heroin.” Cottrill admitted to working with others to distribute methamphetamine and heroin from November 2019 to January 2020 in Ritchie County.Assistant U.S. Attorney Andrew R. Cogar prosecuted the case on behalf of the government. The Drug Enforcement Administration and the Ritchie County Sheriff’s Office investigated.
Senior U.S. District Judge Irene M. Keeley presided.
Guatemalan National Charged with Illegal ReentryRead the Press Release
BOSTON – A Guatemalan national was indicted today in federal court in Boston with illegal reentry after deportation.
Franklin Vasquez Ramirez, 39, was charged with one count of unlawful reentry of a deported alien. Ramirez will make an initial appearance in Boston at a later date.
According to the indictment, in December 2020, law enforcement encountered Ramirez in Ashland and determined him to be illegally present in the United States. Ramirez was previously deported in November 2010.
The charge of unlawful reentry of a deported alien provides for a sentence of up to 10 years in prison, three years of supervised released and a fine of up to $250,000. Ramirez will be subject to deportation upon completion of his sentence. Sentences are imposed by a federal district court judge based on the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney Nathaniel R. Mendell; William S. Walker, Acting Special Agent in Charge of Homeland Security Investigations; and Todd M. Lyons, Field Office Director, Boston, U.S. Immigration and Customs Enforcement’s Enforcement and Removal Operations in Boston made the announcement today. Assistant U.S. Attorney Benjamin A. Saltzman of Mendell’s Major Crimes Unit is prosecuting the case.
The details contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Greenville Man Faces Federal Child Pornography ChargesRead the Press Release
Bowling Green – A federal grand jury in Bowling Green returned an indictment today charging a Greenville, Kentucky man with the possession, receipt, distribution, and production of child pornography.
According to court documents, Corey Stephens, 29, of Greenville, Kentucky, possessed, received, distributed, and produced child pornography. According to a previously filed criminal complaint, on May 16, 2021, a Homeland Security Investigations (HSI), Special Agent acting in an undercover capacity encountered an individual on the KIK messenger application who posted an image of child pornography to a group.
HSI traced the message to Corey Stephens’s Greenville, Kentucky home, and HSI and Kentucky State Police executed a federal search warrant there on May 20, 2021.
Stephens is charged with four counts: possessing, receiving, distributing, and producing child pornography. If convicted at trial, Stephens faces not less than 15 years and not more than 90 years in prison for the crimes charged. There is no parole in the federal system. The case is next scheduled for arraignment on June 24, 2021, at 10 A.M. before U.S. Magistrate Judge H. Brent Brennenstuhl of the U.S. District Court for the Western District of Kentucky.
Acting U.S. Attorney Michael A. Bennett of the Western District of Kentucky and Assistant Special Agent in Charge Harley R. Shuler of the Department of Homeland Security Investigations made the announcement.
The Department of Homeland Security Investigations and the Kentucky State Police investigated the case.
Assistant U.S. Attorney Madison Sewell, Branch Chief of the Bowling Green U.S. Attorney’s Office, 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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This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims.
Georgia Man Charged with Robbing Two Asheville Banks Is Arrested by the FBIRead the Press Release
ASHEVILLE, N.C. – Acting U.S. Attorney William T. Stetzer announced that Johnny Jermaine Davis, 37, of Kennesaw, Georgia, who is charged with robbing two Asheville area banks, was arrested by the FBI today in Georgia.
Robert R. Wells, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Chief David Zack of the Asheville Police Department join Acting U.S. Attorney Stetzer in making today’s announcement.
According to the filed criminal complaint, on February 25, 2021, at approximately 3:02 p.m., an individual later identified as Davis entered a BB&T bank branch located at 1653 Hendersonville Road in Asheville and approached the teller area. The charging document alleges that Davis pulled a handgun, pointed it at a bank teller, yelled “Don’t move,” and then jumped behind the counter. Davis then allegedly ordered three bank employees to lie down on the ground, as he began taking cash from the bank’s drawers. Davis allegedly proceeded to flee the scene with $8,950 in cash.
According to allegations in court documents, on May 20, 2021, at approximately 4:46 p.m., Davis entered the Wells Fargo bank branch located at 800 Merrimon Avenue, in Asheville. As with the previous robbery, Davis allegedly approached the teller counter, pointed a firearm at a bank teller, jumped over the counter and ordered the bank employees to lie down on the ground. Allegedly, Davis then emptied the bank’s cash drawers and fled the scene with $831 in cash.
The criminal complaint charges Davis with bank robbery, which carries a maximum penalty of 20 years in prison and a $250,000 fine.
The charges contained in the criminal complaint are allegations, and the defendant is innocent until proven guilty beyond reasonable doubt in a court of law.
In making today’s announcement, Acting U.S. Attorney Stetzer commended the FBI and the Asheville Police Department for their investigation of the case, and thanked the Hendersonville Police Department, the Acworth Police Department and the Rome Police Department in Georgia for their invaluable assistance.
Assistant United States Attorney, Don Gast, of the U.S. Attorney’s Office in Asheville is prosecuting the case.
Georgia CPA Indicted for Promoting Syndicated Conservation Easement Tax Scheme Involving Fraudulent Charitable DeductionsRead the Press Release
A federal grand jury sitting in Atlanta, Georgia, returned an indictment today charging an Atlanta certified public accountant with one count of conspiracy to defraud the United States; 24 counts of wire fraud; 32 counts of aiding or assisting in the preparation of false federal tax returns; and five counts of filing false federal tax returns relating to a wide-ranging, abusive tax shelter scheme.
According to the indictment, between 2014 and 2019, Herbert E. Lewis conspired with others to market, promote, and sell fraudulent tax shelter transactions in the form of syndicated conservation easement (SCE) donations. The SCE tax shelters allegedly enabled high-income taxpayers to purchase membership interests in purported real estate investment funds. According to the indictment, the funds served no legitimate business purpose, but instead were used to generate large fraudulent tax deductions for its participants based on the donated value of the conservation easements.
To further promote the scheme, the indictment alleges that Lewis allowed clients to purchase units in a given SCE shelter after year’s end and that he advised clients to backdate checks and subscription agreements. Lewis then prepared tax returns for these same clients claiming the non-cash charitable deductions generated by the conservation easement donations despite knowing that they were not entitled to claim the charitable deductions. In total, the conservation easement donations allegedly generated hundreds of millions of dollars in tax deductions that were passed through to the SCE shelters and client taxpayers.
For his part, Lewis allegedly received more than $1 million in commissions for selling the SCE shelters. The indictment also alleges that Lewis filed false individual income tax returns that failed to report a substantial portion of his commission income on his individual tax returns.
If convicted, Lewis faces a statutory maximum sentence of 20 years in prison for each count of wire fraud, five years in prison for conspiring to defraud the United States, three years in prison for each count of filing a false tax return, and three years in prison for each count of aiding and assisting in the preparation of a false tax return. He also faces a period of supervised release, monetary penalties, and restitution.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department's Tax Division, Acting U.S. Attorney Kurt R. Erskine for the Northern District of Georgia, and IRS Commissioner Charles P. Rettig made the announcement.
IRS-Criminal Investigation and the U.S. Postal Inspection Service are investigating the case.
Tax Division Trial Attorneys Brittney Campbell, Grace Albinson, Casey Smith, and Parker Tobin, along with Assistant U.S. Attorney Thomas Krepp of the Northern District of Georgia, 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.