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22 July 2021
United States Seizes Funeral Scrolls and Manuscripts Taken from Pre-Holocaust Jewish Communities in Eastern EuropeRead the Press Release
Jacquelyn Kasulis, Acting United States Attorney for the Eastern District of New York, and Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), announced today the seizure of 17 Jewish Funeral Scrolls, Pinkas Manuscripts (“Scrolls and Manuscripts”) and Community Records that had been taken from Jewish communities in Romania, Hungary, Ukraine and Slovakia during World War II. The Scrolls and Manuscripts, which date from the mid-19th century to World War II, were confiscated from Jewish communities and disappeared during the Holocaust. The artifacts were found through a Brooklyn auction house that offered them for sale, as well as a consigner and a purchaser. Three additional artifacts are believed to be in Israel and one in upstate New York.
“The Scrolls and Manuscripts that were illegally confiscated during the Holocaust contain priceless historical information that belongs to the descendants of families that lived and flourished in Jewish communities before the Holocaust. This Office hopes that today’s seizure will contribute to the restoration of pre-Holocaust history in Eastern Europe.” stated Acting U.S. Attorney Kasulis. “I commend the efforts of this Office’s Civil Division and HSI in recovering these important religious artifacts.”
“The recovery of these 19th century Judaica Manuscripts and Scrolls looted during the Holocaust from Romania, Hungary, Slovakia, and Ukraine in the midst of our world’s darkest of times, is the culmination of an extensive HSI cultural property investigation, and we are fortunate to be part of the team that is able to return these artifacts to their rightful Jewish communities,” stated HSI Special Agent-in-Charge Fitzhugh. “The HSI NY Cultural Property, Art & Antiquities Investigations unit works tirelessly with the United States Attorney’s Office for the Eastern District of New York to investigate the looting, theft and sale of critical pieces of history, and will continue to bring to justice the individuals and transnational criminal organizations who profit from the trafficking of these cultural treasures.”
As set forth in the search warrant affidavit, in February 2021, law enforcement learned that an auction house located in the Eastern District of New York had offered for sale 21 Manuscripts and Scrolls originating from Jewish communities that existed before World War II and the Holocaust. The members of those communities from which the Scrolls and Manuscripts were taken had been gathered in ghettos, robbed of their property and deported to Nazi death camps, where the majority of them were killed. After the end of World War II, surviving members of the communities returned to find their homes ransacked and buildings emptied of property. Among the items that were stolen were the Scrolls and Manuscripts that contained information related to the Jewish communities from as early as 1840 and up through and including the Holocaust. These Scrolls and Manuscripts contained prayers for the dead, memorial pages and/or the names of deceased members of the Jewish communities, operating rules of the society, society member payments, obligations, society regulations, the identity of society religious leaders, and, in some cases, the names of the society members who were deported by the Nazis to the Auschwitz concentration camp. The Manuscripts and Scrolls were confiscated by individuals who had no right to do so during and after the Holocaust. Absent any provenance or documentation of conveyance from any survivors of those communities, there is no legitimate means by which the Manuscripts and Scrolls could have been imported into the United States.
The government’s case is being handled by Assistant United States Attorney Artemis Lekakis of the Office’s Civil Division and the investigation was conducted by Department of Homeland Security Agents Megan Buckley and Robert Mancene.
E.D.N.Y. Docket No.: 21-MJ-837 (PK)
United States Reaches Resolution of ADA Complaint with RC Theatres Management LLLPRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced a letter of resolution with RC Theatres Management LLLP, the owner and operator of Queensgate RC Theatres located in York, Pennsylvania. The agreement was reached under Title III of the Americans with Disabilities Act (“ADA”).
According to Acting United States Attorney Bruce D. Brandler, the United States Department of Justice received a complaint that the Queensgate RC Theatre was not accessible to individuals with visual impairments, namely the movie theater did not have descriptive audio headsets. After an investigation with the owner’s cooperation, the United States Attorney’s Office determined that the Queensgate RC Theatre failed to have the required descriptive audio headset for the visually impaired complainant.
Soon after RC Theatres received notice of the complaint, it took steps to come into compliance with the ADA by purchasing audio descriptive devices and by training employees on the use of the devices at this location. RC Theatres will continue to annually train theater employees. RC Theatres will also provide notice about the availability of these devices on their webpage.
“Owners of movie theaters must ensure that viewings of films comply with all requirements of the ADA, and that they provide equal access for all people,” said Acting U.S. Attorney Bruce D. Brandler. “RC Theatres quickly and cooperatively worked to address the ADA violations discovered during our investigation, which will enable visually impaired patrons to enjoy movies at the Queensgate location.”
Federal law requires public accommodations, including movie theaters, to provide individuals with disabilities equal access to facilities. The ADA authorizes the U.S. Department of Justice and the U.S. Attorney’s Office to undertake investigations and periodic reviews of covered establishments. For more information on the ADA, visit www.ADA.gov. Members of the public may report possible civil rights violations at https://civilrights.justice.gov/report/. Anyone in the Middle District of Pennsylvania may also report civil rights violations to the Civil Rights coordinator of the U.S. Attorney’s Office for the Middle District of Pennsylvania by calling 717-614-4911 or emailing [email protected].
This case was handled by Assistant United States Attorney Michael J. Butler.
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U.S. Department of Justice Announces Launch of Firearms Trafficking Strike Forces to Crack Down on Sources of Crime GunsRead the Press Release
SAN FRANCISCO –The U.S. Department of Justice today launched five cross-jurisdictional strike forces to help reduce gun violence by disrupting illegal firearms trafficking in key regions across the country. Leveraging existing resources, the regional strike forces will better ensure sustained and focused coordination across jurisdictions and help stem the supply of illegally trafficked firearms from source cities, through other communities, and into five key market regions: New York, Chicago, Los Angeles, the San Francisco Bay Area/Sacramento Region and Washington, D.C.
Each strike force region will be led by designated United States Attorneys, who will collaborate with the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) and with state and local law enforcement partners within their own jurisdiction where firearms are used in crimes as well as with law enforcement partners in areas where illegally trafficked guns originate. Officials will use the latest data, evidence, and intelligence from crime scenes to identify patterns, leads, and potential suspects in violent gun crimes.
“All too often, guns found at crime scenes come from hundreds or even thousands of miles away. We are redoubling our efforts as ATF works with law enforcement to track the movement of illegal firearms used in violent crimes. These strike forces enable sustained coordination across multiple jurisdictions to help disrupt the worst gun trafficking corridors,” said Attorney General Merrick B. Garland. “The Department of Justice will use all of its tools – enforcement, prevention, intervention, and investment – to help ensure the safety of our communities – the department’s highest priority.”
According to gun trace data, a significant number of firearms recovered in the San Francisco Bay Area and the greater Sacramento region originate outside of California and are illegally trafficked into the state. The new San Francisco Bay Area/Sacramento Region Strike Force is jointly helmed by the United States Attorney’s Offices of the Northern and Eastern Districts of California, led by Acting United States Attorneys Stephanie M. Hinds in San Francisco and Phillip A. Talbert in Sacramento, respectively. The ATF San Francisco Field Office, led by Special Agent in Charge Patrick T. Gorman, will support and be integral to the strike force. The strike force will help ensure sustained and focused coordination between law enforcement and prosecutors in San Francisco Bay Area and the Sacramento region with their counterparts in locations where many of the firearms originate.
“Firearms illegally imported into California commonly contribute to violence in crimes committed on the streets of our communities,” said Acting United States Attorney Stephanie M. Hinds for the Northern District of California. “Enhancing our focus on tracing and tracking the source of these illegally trafficked firearms will help stem their flow and assist in combatting violent crime. Our strike force, which I am honored to co-chair with Acting United States Attorney Phillip A. Talbert from the Eastern District of California, and with the critical support of ATF San Francisco Field Office Special Agent in Charge Patrick T. Gorman, is a strong step in the right direction. Because many of the firearm source locations for our Bay Area and Sacramento regions overlap with the source locations for firearms recovered in Southern California, our strike force will work closely with the Los Angeles Strike Force.”
The strike forces represent one important, concrete step in implementing the Department’s Comprehensive Violent Crime Reduction Strategy, which was announced on May 26, 2021. The comprehensive strategy supports local communities in preventing, investigating, and prosecuting gun violence and other violent crime—and requires U.S. Attorneys’ offices to work with federal, state, local and tribal law enforcement, as well as the communities they serve, to address the most significant drivers of violence in their districts. In guidance to federal agents and prosecutors as part of that comprehensive strategy, the Deputy Attorney General made clear that firearms traffickers providing weapons to violent offenders are an enforcement priority across the country.
Department of Justice Efforts to Address Violent Crime
Since April 2021, the Department has taken the following steps to reduce and prevent violent crime, especially the gun crime that is often at the core of the problem:
- On April 8, Attorney General Garland, alongside President Biden, announced four concrete steps for addressing gun violence: ATF would propose a new rule within 30 days to help curb the proliferation of so-called ghost guns, ATF would propose a new rule within 60 days on stabilizing braces used to convert pistols into short-barreled rifles, the Department would publish model state extreme risk protection order legislation within 60 days; and ATF would begin preparing a thorough and detailed new public study of firearms trafficking for the first time in 20 years.
- In April 2021, the Office of Justice Programs also made clear when existing grant funds could be used to support Community Violence Intervention (CVI) programs.
- On May 7, meeting the Attorney General’s announced timeline, ATF issued a notice of proposed rulemaking to update outdated firearms definitions and to help address the proliferation of ghost guns.
- On May 26, the Attorney General announced the Department’s comprehensive strategy to reduce violent crime, including an overall Department Violent Crime Reduction Strategy, the strengthening of Project Safe Neighborhoods (PSN), and a directive to the U.S. Attorneys to work with their local partners in addressing the increase in violence that typically occurs over the summer (with specific support from DOJ law enforcement agencies)
- On June 7, meeting the Attorney General’s announced timeline, ATF issued a notice of proposed rulemaking to clarify that the restrictions imposed by the National Firearms Act apply when stabilizing braces are used to convert pistols into short-barreled rifles.
- On June 8, meeting the Attorney General’s announced timeline, the Department published model state extreme risk protection order legislation.
- On June 22, the Attorney General announced that the Department would be forming five Firearms Trafficking Strike Forces within 30 days.
- On, June 23, the Attorney General, alongside President Biden, announced steps that ATF would take to hold rogue gun dealers accountable for their actions. They include applying a “no tolerance” policy for federal firearms licensers (FFLs) that willfully commit violations that endanger public safety; designating points of contact for state and local government officials to report concerns about rogue FFLs; formalizing the use of public safety factors for inspection prioritization; sharing inspection information with states that regulate firearms dealers themselves; resuming the practice of notifying revoked dealers on how to dispose of their inventory and the potential criminal consequences of continuing to engage in the business; increasing ATF’s resources for inspections (see, FY 2022 Budget request); and publicly posting disaggregated inspection information to ATF’s website.
U.S. Attorney’s Office in Chicago to Participate in Cross-Jurisdictional Firearms Trafficking Strike ForceRead the Press Release
WASHINGTON - The U.S. Department of Justice today launched five cross-jurisdictional strike forces to help reduce gun violence by disrupting illegal firearms trafficking in key regions across the country. Leveraging existing resources, the regional strike forces will better ensure sustained and focused coordination across jurisdictions and help stem the supply of illegally trafficked firearms from source cities, through other communities, and into five key market regions: New York, Chicago, Los Angeles, the San Francisco Bay Area/Sacramento Region, and Washington, D.C.
Each strike force region will be led by designated United States Attorneys, who will collaborate with the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) and with federal, state, and local law enforcement partners within their own jurisdiction (where firearms are used in crimes) as well as law enforcement partners in areas where illegally trafficked guns originate. These officials will use the latest data, evidence, and intelligence from crime scenes to identify patterns, leads, and potential suspects in violent gun crimes.
“All too often, guns found at crime scenes come from hundreds or even thousands of miles away," said Attorney General Merrick B. Garland. "We are redoubling our efforts as ATF works with law enforcement to track the movement of illegal firearms used in violent crimes. These strike forces enable sustained coordination across multiple jurisdictions to help disrupt the worst gun trafficking corridors. The Department of Justice will use all of its tools – enforcement, prevention, intervention, and investment – to help ensure the safety of our communities – the department’s highest priority.”
“Straw purchasers and unlicensed gun sellers enable violence,” said John R. Lausch, Jr., United States Attorney for the Northern District of Illinois. “The cross-jurisdictional strike force will increase collaboration with our federal, state, and local law enforcement partners, and enhance our longstanding efforts to hold accountable individuals or groups who illegally traffic firearms into Chicago.”
According to gun trace data, a significant number of firearms recovered in Chicago originate outside Chicago and are illegally trafficked into the city. The new strike force, led by U.S. Attorney Lausch, will help ensure sustained and focused coordination between law enforcement and prosecutors in Chicago with counterparts in the locations where many of the firearms originate.
The strike forces represent one important, concrete step in implementing the Department of Justice’s Comprehensive Violent Crime Reduction Strategy, which was announced on May 26, 2021. The comprehensive strategy supports local communities in preventing, investigating, and prosecuting gun violence and other violent crime - and requires U.S. Attorneys’ offices to work with federal, state, local and tribal law enforcement, as well as the communities they serve, to address the most significant drivers of violence in their districts. In guidance to federal agents and prosecutors as part of that comprehensive strategy, the Deputy Attorney General made clear that firearms traffickers providing weapons to violent offenders are an enforcement priority across the country.
Two Texas residents charged with smuggling 89 in trailerRead the Press Release
LAREDO, Texas – A Houston-area man and woman are set to appear in Laredo federal court on allegations they attempted to smuggle undocumented aliens, announced Acting U.S. Attorney Jennifer B. Lowery.
Marc Anthony Bane, 45, Porter, and Tara Renee Dillon, 33, Conroe, are set to appear before U.S. Magistrate Judge Christopher Dos Santos at 3 p.m. today.
According to the charges, Bane and Dillon arrived at the Border Patrol (BP) checkpoint on Interstate Highway 35 approximately 29 miles north of Laredo in a tractor-trailer. There, a service K-9 allegedly detected an odor within the trailer. The charges allege law enforcement then searched the vehicle and found 89 undocumented non-U.S. citizens.
The individuals were sweating profusely inside the warm trailer even though it was approximately 3 a.m. when authorities found them, according to the charges.
Bane allegedly expected to be paid $1,000 for transporting the trailer.
If convicted, Bane and Dillon face up to 10 years in federal prison and a possible $250,000 maximum fine.
Homeland Security Investigations conducted the investigation with the assistance of BP. Assistant U.S. Attorney David Fawcett is prosecuting the case.
A criminal complaint is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.
Two Newark Men Charged with Narcotics Distribution and Firearms ChargesRead the Press Release
NEWARK, N.J. – Two Newark men made their initial appearances today on gang-related narcotics distribution and firearms charges, Acting U.S. Attorney Rachael Honig announced.
Ronnie Holley, 32, and Shadee Holley, 31, both of Newark, are each charged by complaint with one count of conspiracy to distribute fentanyl and cocaine base and one count of possession of a firearm in furtherance of a drug trafficking crime. Ronnie Holley is also charged with one count of possession of a firearm by a convicted felon. They appeared by videoconference this afternoon before U.S. Magistrate Judge Jessica S. Allen and were detained.
According to documents filed in this case and statements made in court:
A set of the national Bloods Street gang known as Sex Money Murders (SMM) operates in and around Newark, New Jersey. Since 2007, members of SMM have engaged in violent disputes with other gangs, trafficked narcotics, and committed various firearms offenses. Law enforcement officials learned that Ronnie and Shadee Holley, who are brothers, were high-ranking members of SMM and operated a sophisticated narcotics distribution operation around Martin Luther King Boulevard and Spruce Street. Law enforcement officials learned that Ronnie Holley used multiple houses and multiple vehicles to store narcotics, narcotics proceeds, and firearms.
A confidential source conducted eight controlled purchases of fentanyl and crack-cocaine from Ronnie and Shadee Holley over the past few months. Those purchases totaled approximately 40 grams of suspected fentanyl, and approximately 25 grams of suspected crack-cocaine.
The count of narcotics conspiracy is punishable by a mandatory minimum of five years in prison and a maximum sentence of 40 years in prison. The count of possession of a firearm during a crime of violence is punishable by a mandatory minimum of five years in prison and a maximum sentence of life in prison, which must run consecutively to any term of imprisonment imposed on any other charges. The count of possession of a firearm by a convicted felon is punishable by a maximum sentence of 10 years in prison.
Acting U.S. Attorney Honig credited the Essex County Sheriff’s Office, under the direction of Sheriff Armando B. Fontoura; and special agents of the Drug Enforcement Administration, under the direction of Special Agent in Charge Susan A. Gibson in Newark, with the investigation leading to the charges.
This case is part of the U.S. Attorney’s Office’s Violent Crime Initiative (VCI). The VCI was formed in August 2017 by the U.S. Attorney’s Office for the District of New Jersey, the Essex County Prosecutor’s Office, and the City of Newark’s Department of Public Safety for the purpose of combatting violent crime in and around Newark. As part of this partnership, federal, state, county, and city agencies collaborate and pool resources to prosecute violent offenders who endanger the safety of the community. The VCI is composed of the U.S. Attorney’s Office, the FBI, the ATF, the DEA, the U.S. Marshals, the Newark Department of Public Safety, the Essex County Prosecutor’s Office, the Essex County Sheriff’s Office, N.J. State Parole, Union County Jail, N.J. State Police Regional Operations and Intelligence Center/Real Time Crime Center, N.J. Department of Corrections, the East Orange Police Department, and the Irvington Police Department.
The government is represented by Assistant U.S. Attorney George L. Brandley of the OCEDTF Unit in Newark.
The charges and allegations contained in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Two Minnesota Men Sentenced for Meth Trafficking ConspiracyRead the Press Release
Acting United States Attorney Dennis Holmes announced that a Worthington, Minnesota, man and an Albert Lea, Minnesota, man convicted of Conspiracy to Distribute a 500 Grams or More of Methamphetamine, were sentenced by U.S. District Judge Lawrence L. Piersol.
Quentin L. Guyton, age 33, was sentenced on January 5, 2021, to 120 months in federal prison, followed by five years of supervised release, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Ojulu Omot, a/k/a “Al,” age 27, was sentenced on July 16, 2021, to 132 months in federal prison, followed by five years of supervised release, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Guyton and Omot were indicted by a federal grand jury on February 4, 2020. Guyton pled guilty on October 13, 2020, and Omot pled guilty on April 29, 2021.
The conviction stemmed from incidents beginning on an unknown date until on or about February 4, 2020, in the District of South Dakota, when Guyton and Omot knowingly and intentionally combined, conspired, confederated, and agreed together with each other, and others known and unknown, to intentionally distribute 500 grams or more of a mixture and substance containing methamphetamine. Methamphetamine is a Schedule II controlled substance.
Guyton and Omot joined in an agreement or understanding to distribute methamphetamine. They knew the purpose of the agreement or understanding and they could foresee that the quantity of mixture or substance containing methamphetamine exceeded 500 grams.
During the course of the conspiracy, Guyton supplied Omot for the purpose of reselling it in South Dakota and elsewhere.
This case was investigated by the Sioux Falls Police Department, the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the U.S. Drug Enforcement Administration, and the Buffalo Ridge Drug Task Force in southwestern Minnesota. Assistant U.S. Attorney Jennifer D. Mammenga prosecuted the case.
Guyton and Omot were immediately turned over to the custody of the U.S. Marshals Service following their respective sentencings.
Two Defendants Plead Guilty to Federal Charges Filed in Connection with Oakland-Based EB-5 Visa Investment SchemeRead the Press Release
OAKLAND - Thomas Henderson pleaded guilty in federal court today to one count of conspiracy to commit wire fraud and one count of making a false statement to a government agency related to his role in deceiving investors in various Oakland, California-based businesses, announced Acting United States Attorney Stephanie M. Hinds; U.S. Department of State’s Diplomatic Security Service (DSS) Special Agent in Charge William Chang; Homeland Security Investigations Special Agent in Charge Tatum King; and Federal Bureau of Investigation Special Agent in Charge Craig Fair. A second defendant, Cooper Lee, also pleaded guilty to one count of conspiracy for his role in diverting certain investor funds. The guilty pleas were accepted by the Hon. Richard Seeborg, Chief U.S. District Judge.
Henderson, 72, of Oakland, and Lee, 44, formerly of Oakland, pleaded guilty to charges pursuant to separate plea agreements entered by the court. According to Henderson’s plea agreement, Henderson admitted he formed the San Francisco Regional Center, LLC (SFRC) in 2010 to raise money from foreign investors through the “EB-5” visa program, a job-creation and immigration program administered by U.S. Citizenship and Immigration Services (USCIS). From 2011 to 2017, SFRC raised more than $100 million from foreign investors for seven commercial enterprises approved under the EB-5 program. Henderson admitted that by at least the middle of 2014, SFRC began using investor funds for purposes and projects other than the specific enterprise corresponding to the investment, and that investors were not specifically told that their investment funds would be or were used for those purposes. For example, Henderson admitted that funds raised from 42 investors for the enterprise North America 3PL LP were used for other projects and businesses, including to fund the operation of earlier struggling projects. Henderson also admitted that he made false statements to USCIS when he submitted a declaration to the agency regarding the use of North America 3PL investor funds.
According to Lee’s plea agreement, from about August 2016 to January 2017, Lee conspired with Henderson to divert some funds raised for the EB-5 enterprise operating as California Gold Medal LP to other EB-5 enterprises and businesses controlled by Henderson. Lee admitted that he transferred funds and prepared documents to make it appear that the transfers were for legitimate business transactions.
USCIS administers the EB-5 visa program. Under the program, foreign nationals may obtain permanent United States residency, commonly known as a Green Card, by investing in qualifying U.S. businesses and creating jobs for U.S. citizens and residents. To receive a two-year grant of conditional permanent residency status, foreign investors must meet certain requirements for an entry visa, comply with program requirements and make an investment of a minimum of $1 million, or $500,000 if the investment is made in certain areas of high unemployment. After two years, the foreign investor and immediate family can petition for permanent residency after meeting program requirements, including the creation of at least 10 jobs for United States citizens and residents through the business funded by the investment.
Chief Judge Seeborg scheduled Lee’s sentencing for December 7, 2021, and Henderson’s sentencing for June 7, 2022.
Henderson pleaded guilty to one count of conspiracy to commit wire fraud, in violation of 18 U.S.C. § 1349, and one count of making a false statement to a government agency, in violation of 18 U.S.C. § 1001(a)(2). The conspiracy charge carries a maximum statutory penalty of 20 years in prison and a fine of up to $250,000. The false statement charge carries a maximum penalty of 5 years in prison and a fine of up to $250,000. Lee pleaded guilty to one count of conspiracy, in violation of 18 U.S.C. § 371, which carries a maximum penalty of 5 years in prison and $250,000. Under the terms of each plea agreement, other charges will be dismissed at sentencing if the defendant complies with the agreement. The court also may order additional terms of supervised release, fines, forfeitures, and restitution; however, any sentence following conviction would be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant U.S. Attorneys Lloyd Farnham and Sheila A.G. Armbrust are prosecuting the case, with the assistance of Patricia Mahoney. The prosecution was the result of an investigation led by the U.S. Department of State Diplomatic Security Service’s representative to the Document and Benefit Fraud Task Force (DBFTF), overseen by the HSI, with the participation of the Federal Bureau of Investigation. The DBFTF is a multi-agency task force that coordinates investigations into fraudulent immigration documents. U.S. Citizenship and Immigration Service’s Office of Fraud Detection and National Security also assisted with the investigation. Additional assistance was provided by the San Francisco Regional Office of the Securities and Exchange Commission.
Twenty-two defendants charged in connection with alleged $11.1 million Paycheck Protection Program fraud schemeRead the Press Release
ATLANTA – Seventeen more individuals have been charged in connection with a fraudulent scheme to obtain approximately $11.1 million in Paycheck Protection Program (PPP) loans and to use those funds to purchase luxury vehicles, jewelry, and other personal items. To date, a total of 22 individuals have been charged in connection with the fraudulent scheme. Six individuals, including the scheme’s mastermind, Darrell Thomas, have pleaded guilty.
“The defendants allegedly took advantage of emergency financial assistance intended for business owners suffering the economic effects caused by the COVID-19 pandemic,” said Acting U.S. Attorney Kurt R. Erskine. “The charges reinforce our resolve to prosecute anyone who used pandemic relief funds for personal gain.”
“So many businesses needed federal emergency assistance to stay afloat during a pandemic, and these defendants allegedly misdirected millions of dollars of that assistance money to their own pockets for luxury items,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “Their alleged greed affects every American taxpayer, and the FBI is making every effort possible to stop it and make sure PPP funds are used as intended.”
“When tragedy strikes and citizens find themselves in a vulnerable situation to no fault of their own, the influx of government assistance unfortunately also attracts criminals,” said IRS-Criminal Investigation Special Agent in Charge James E. Dorsey. “While the government is helping those in need, law enforcement is swiftly addressing these vulnerabilities. IRS-CI will continue to help illuminate these criminal deeds with our financial expertise.”
“The Treasury Inspector General for Tax Administration aggressively pursues those who endeavor to defraud programs afforded to the American people under the CARES Act,” said J. Russell George, the Treasury Inspector General for Tax Administration. “We appreciate the efforts of the Department of Justice and our law enforcement partners in this effort.”
“Scheming to fraudulently obtain federal funds that are meant to provide assistance to nation’s small businesses is unacceptable,” said SBA OIG’s Eastern Region Special Agent in Charge Amaleka McCall-Brathwaite. “Our Office will remain relentless in the pursuit of fraudsters who seek to exploit SBA’s vital economic programs. I want to thank the U.S. Attorney’s Office and our law enforcement partners for their dedication and commitment to seeing justice served.”
According to Acting U.S. Attorney Erskine, the first superseding indictment, and other information presented in court: From April 2020 through August 2020, the conspirators in the scheme allegedly submitted, or assisted in the submission of, PPP loan applications on behalf of fourteen businesses, seeking loans of approximately $700,000 - $850,000 for each company:
Business Name
PPP Loan Amount
Bellator Phront Group Inc.
$799,955.35
Impact Creations LLC
$830,000
Gaines Reservation and Travel
$806,710
Transportation Management Services
$830,417
Lee Operations LLC
$805,813
RK Painting Co.
$775,000
D Parker Holdings Inc.
$818,102
Continuing Success Inc.
$727,000
All Star Room & Board Services of Michigan Inc.
$737,965
Infinite Education Services Inc.
$854,805
ML Exotic Customs Inc.
$797,275
Bellevie Corp.
$823,585
Advertising and Then Some Inc.
$760,207
Mickies Auto and Tires LLC
$787,160
Total
$11,153,994
In the loan applications, the defendants certified that each applicant business was in operation on February 15, 2020 and had employees for whom it paid salaries and payroll taxes or paid independent contractors; that the funds would be used to retain workers and maintain payroll or make mortgage interest payments, lease payments, and utility payments; and that the information provided in the application and in all supporting documents and forms was true and accurate in all material respects.
The PPP loan applications reported that each business had between 59 and 69 employees and approximately $295,000 to $342,000 in average monthly payroll expenses. To support these payroll figures, each business’s loan application was accompanied by an Internal Revenue Service Form 941, which employers use to report payroll taxes, for each quarter of 2019 and by a bank statement or a spreadsheet reflecting payroll expenses. In reality, however, none of the businesses had employees or payroll expenses. The Form 941s, bank statements, and W2 payroll spreadsheets had all been fabricated. Indeed, some of the supporting documents the businesses submitted were substantively identical, including identical Form 941s, identical bank statements, and W2 payroll spreadsheets where the reported figures were identical but purported employee names had been changed.
After the PPP loan proceeds were deposited into the businesses’ accounts, the businesses transferred more than $5.5 million of the PPP loan proceeds into accounts controlled by Darrell Thomas, purportedly for rental payments and payroll. However, none of the businesses had any legitimate business with any of the businesses or accounts to which they sent the proceeds. Based on the investigation, none of the companies allegedly engaged in any business-related transactions or used the PPP loan proceeds for any authorized purposes. Instead, the businesses used the funds for various personal expenses. In connection with the investigation, the United States seized nearly $4 million in PPP loan proceeds, four luxury vehicles, and several jewelry items.
Fourteen additional defendants were charged in a First Superseding Indictment unsealed on Wednesday, July 14, 2021:
- Ricky Dixon, 52, of Warren, Michigan, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, false statements to a federally insured financial institution, aggravated identity theft, and money laundering in connection with his involvement in the loan obtained by his business, RK Painting Co., and several other businesses’ loans.
- Meghan Thomas, 32, of Alpharetta, Georgia, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, and false statements to a federally insured financial institution in connection with her involvement in several businesses’ loans.
- Jesika Blakely, 34, of Atlanta, Georgia, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, false statements to a federally insured financial institution, and money laundering in connection with her involvement in several businesses’ loans.
- Amanda Christian, 33, of Blythewood, South Carolina, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, and false statements to a federally insured financial institution in connection with her involvement in the loan obtained by her business, Advertising and Then Some Inc., and several other businesses’ loans.
- Dwan Ashong a/k/a Dwan Gilpin, 40, of Jacksonville, Florida, is charged with conspiracy to commit wire fraud, wire fraud, and money laundering in connection with her involvement in several businesses’ loans.
- John Gaines a/k/a Marty Gaines, 56, of Marietta, Georgia, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, false statements to a federally insured financial institution, and money laundering in connection with the loan obtained by Gaines Reservation and Travel.
- Charles Petty a/k/a Charles Knight, 48, of Atlanta, Georgia, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, false statements to a federally insured financial institution, and money laundering in connection with the loan obtained by Transportation Management Services Inc.
- Jerry Baptiste, 43, of College Park, Georgia, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, false statements to a federally insured financial institution, and money laundering in connection with the loan obtained by Transportation Management Services Inc.
- Derek Parker, 56, of Rochester Hills, Michigan, is charged with conspiracy to commit wire fraud, wire fraud, and money laundering in connection with the loan obtained by his business, D Parker Holdings Inc.
- David Belgrave II, 49, of Lexington, South Carolina, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, false statements to a federally insured financial institution, and money laundering in connection with the loan obtained by his business, Continuing Success Inc.
- Charles Hill IV, 45, of Norcross, Georgia, is charged with conspiracy to commit wire fraud, wire fraud, and money laundering in connection with the loan obtained by his business, Infinite Education Services Inc.
- Ryan Whittley, 35, of South Holland, Illinois, is charged with conspiracy to commit wire fraud, wire fraud, and money laundering in connection with the loan obtained by his business, ML Exotic Customs Inc.
- El Hadj Sall, 39, of Jacksonville, Florida, is charged with conspiracy to commit wire fraud, wire fraud, and money laundering in connection with the loan obtained by his business, Bellevie Corp.
- Rick McDuffie, 50, of Little Rock, South Carolina, is charged with conspiracy to commit wire fraud and wire fraud in connection with the loan obtained by his business, Mickies Auto and Tire LLC.
Three additional defendants have been charged by Criminal Information:
- Teldrin Foster, 39, of Decatur, Georgia, is charged with conspiracy to commit wire fraud in connection with the loan obtained by Bellator Phront Group Inc.
- Denesseria Slaton, 52, of Stockbridge, Georgia, is charged with conspiracy to commit bank fraud and wire fraud in connection with the loan obtained by Transportation Management Services Inc.
- Charmaine Redding, 27, of Macomb, Michigan, is charged with conspiracy to commit wire fraud in connection with the loan obtained by her business, All Star Room and Board Services of Michigan Inc.
- Another defendant, Carla Jackson, 53, of Tucker, Georgia, was previously charged by indictment on August 4, 2020 with money laundering in connection with laundering the proceeds of Gaines Reservation and Travel’s PPP loan.
Six defendants have pleaded guilty based on their roles in the fraudulent scheme since the original indictment was returned on August 4, 2020, including the mastermind, Darrell Thomas, and one defendant has been sentenced to date:
- Darrell Thomas, 35, of Duluth, Georgia, pleaded guilty on June 16, 2021 to one count of conspiracy to commit bank fraud and wire fraud and one count of money laundering. As part of his guilty plea, Darrell Thomas admitted his participation in fraudulent conduct totaling more than $14.7 million, including more than $11.1 million in fraudulent PPP loans, more than $1.15 million in fraudulent Economic Injury Disaster Loans, and more than $2.4 million in fraudulent automobile loans. He also agreed to forfeit various assets, including more than $2.1 million in seized funds, three luxury vehicles – a 2018 Mercedes-Benz S-Class S65AMG, a 2018 Land Rover Range Rover, and a 2017 Acura NSX – and several items of jewelry, including a gold Rolex. Darrell Thomas’s sentencing is set for September 15, 2021 before Judge J.P. Boulee.
- Denesseria Slaton, pleaded guilty on June 16, 2021 to one count of conspiracy to commit bank fraud and wire fraud in connection with the loan obtained by Transportation Management Services Inc. Slaton’s sentencing is set for October 6, 2021.
- Khalil Gibran Green, Sr., 47, of Cleveland, Ohio, pleaded guilty on September 1, 2020, to one count of conspiracy to commit bank fraud and wire fraud in connection with the loan obtained by his business, Impact Creations LLC. On January 14, 2021, Judge J.P. Boulee sentenced Green to three years and five months’ imprisonment and five years of supervised release, and Judge Boulee ordered him to pay $830,000 in restitution, forfeiture of $157,035.71, and a special assessment of $100.
- Bern Benoit, 45, of Burbank, California, pleaded guilty on March 11, 2021 to one count of conspiracy to commit bank fraud and wire fraud in connection with the loan obtained by his business, Transportation Management Services Inc. Benoit’s sentencing is set for September 8, 2021 before Judge J.P. Boulee.
- Charmaine Redding, pleaded guilty on July 14, 2021 to one count of conspiracy to commit wire fraud in connection with the loan obtained by her business, All Star Room and Board Services of Michigan Inc. Redding’s sentencing is set for October 21, 2021 before Judge J.P. Boulee.
- Andre Lee Gaines, 67, of Dallas, Georgia, pleaded guilty on June 17, 2021 to one count of making false statements to the FBI in connection with the loan obtained by his business, Gaines Reservation and Travel. Andre Gaines’s sentencing is set for October 6, 2021 before Judge J.P. Boulee.
Members of the public are reminded that the indictment contains only charges.
This case is being investigated by the Federal Bureau of Investigation, the Internal Revenue Service-Criminal Investigation, the U.S. Treasury Inspector General for Tax Administration, and the Small Business Administration-Office of the Inspector General.
Assistant U.S. Attorneys Tal Chaiken and Nathan Kitchens of the Northern District of Georgia and Trial Attorney Siji Moore of the Criminal Division’s Fraud Section are prosecuting the case.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts, For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Twenty-Two Charged in Connection with a More than $11-Million Paycheck Protection Program Fraud SchemeRead the Press Release
Seventeen more individuals have been charged in connection with a fraudulent scheme to obtain approximately $11.1 million in Paycheck Protection Program (PPP) loans and to use those funds to purchase luxury vehicles, jewelry and other personal items.
According to court documents and statements made in court, between May and August 2020, the defendants submitted, or assisted in the submission of, PPP loan applications on behalf of 14 businesses seeking loans of approximately $800,000 for each company. In the loan applications, the defendants certified that each applicant business was in operation on Feb. 15, 2020, and had employees for whom it paid salaries and payroll taxes or that it paid independent contractors; that the funds would be used to retain workers and maintain payroll or to make mortgage interest payments, lease payments and utility payments; and that the information provided in the application and in all supporting documents was true and accurate in all material respects.
In the PPP loan applications, each business reported that it had approximately 60 employees and approximately $300,000 in average monthly payroll expenses. To support these payroll figures, each business’s loan application was accompanied by an IRS Form 941, which employers use to report payroll taxes. But, in reality, each Form 941 was fraudulent.
After the PPP loan proceeds were deposited into the businesses’ accounts, the funds were distributed to conspirators through a series of transactions that were devised to disguise the origins of the funds and how the funds were spent. The defendants and co-conspirators used the PPP loan proceeds to purchase luxury goods, including two Range Rovers, an Acura NSX, and a Mercedes Benz S-Class S65 AMG.
Seventeen Additional Defendants Charged
Fourteen defendants were charged in a first superseding indictment unsealed on July 14, including:
Ricky Dixon, 52, of Warren, Michigan, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, false statements to a federally insured financial institution, aggravated identity theft, and money laundering in connection with his involvement in the loan obtained by his business, RK Painting Co., and several other businesses’ loans.
Meghan Thomas, 32, of Alpharetta, Georgia, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, and false statements to a federally insured financial institution in connection with her involvement in several businesses’ loans.
Jesika Blakely, 34, of Atlanta, Georgia, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, false statements to a federally insured financial institution, and money laundering in connection with her involvement in several businesses’ loans.
Amanda Christian, 33, of Blythewood, South Carolina, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, and false statements to a federally insured financial institution in connection with her involvement in the loan obtained by her business, Advertising and Then Some Inc., and several other businesses’ loans.
Dwan Ashong, aka Dwan Gilpin, 40, of Jacksonville, Florida, is charged with conspiracy to commit wire fraud, wire fraud, and money laundering in connection with her involvement in several businesses’ loans.
John Gaines, aka Marty Gaines, 56, of Marietta, Georgia, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, false statements to a federally insured financial institution, and money laundering in connection with the loan obtained by Gaines Reservation and Travel.
Charles Petty, aka Charles Knight, 48, of Atlanta, Georgia, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, false statements to a federally insured financial institution, and money laundering in connection with the loan obtained by Transportation Management Services Inc.
Jerry Baptiste, 43, of College Park, Georgia, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, false statements to a federally insured financial institution, and money laundering in connection with the loan obtained by Transportation Management Services Inc.
Derek Parker, 56, of Rochester Hills, Michigan, is charged with conspiracy to commit wire fraud, wire fraud, and money laundering in connection with the loan obtained by his business, D Parker Holdings Inc.
David Belgrave II, 49, of Lexington, South Carolina, is charged with conspiracy to commit bank fraud and wire fraud, bank fraud, wire fraud, false statements to a federally insured financial institution, and money laundering in connection with the loan obtained by his business, Continuing Success Inc.
Charles Hill IV, 45, of Norcross, Georgia, is charged with conspiracy to commit wire fraud, wire fraud, and money laundering in connection with the loan obtained by his business, Infinite Education Services Inc.
Ryan Whittley, 35, of South Holland, Illinois, is charged with conspiracy to commit wire fraud, wire fraud, and money laundering in connection with the loan obtained by his business, ML Exotic Customs Inc.
El Hadj Sall, 39, of Jacksonville, Florida, is charged with conspiracy to commit wire fraud, wire fraud, and money laundering in connection with the loan obtained by his business, Bellevie Corp.
Rick McDuffie, 50, of Little Rock, South Carolina, is charged with conspiracy to commit wire fraud and wire fraud in connection with the loan obtained by his business, Mickies Auto and Tire LLC.
Three additional defendants have been charged by criminal information:
Teldrin Foster, 39, of Decatur, Georgia, is charged with conspiracy to commit wire fraud in connection with the loan obtained by Bellator Phront Group Inc.
Denesseria Slaton, 52, of Stockbridge, Georgia, is charged with conspiracy to commit bank fraud and wire fraud in connection with the loan obtained by Transportation Management Services Inc.
Charmaine Redding, 27, of Macomb, Michigan, is charged with conspiracy to commit wire fraud in connection with the loan obtained by her business, All Star Room and Board Services of Michigan Inc.
Another defendant, Carla Jackson, 53, of Tucker, Georgia, was previously charged by indictment on Aug. 4, 2020, with money laundering in connection with laundering the proceeds of Gaines Reservation and Travel’s PPP loan.
If convicted, the defendants face a maximum penalty of 20 years in prison on the wire fraud and money laundering charges and a maximum of 30 years on the bank fraud and false statement to a federally insured bank charge. Dixon also faces an additional two-year sentence on the aggravated identity theft charge. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Six Plead Guilty, Including Mastermind
Six defendants have pleaded guilty based on their roles in the fraudulent scheme since the original indictment was returned on August 4, 2020, including the mastermind, Darrell Thomas, and one defendant has been sentenced to date:
Darrell Thomas, 35, of Duluth, Georgia, pleaded guilty on June 16, to one count of conspiracy to commit bank fraud and wire fraud and one count of money laundering. As part of his guilty plea, Darrell Thomas admitted his participation in fraudulent conduct totaling more than $14.7 million, including approximately $11.2 million in fraudulent PPP loans, more than $1.15 million in fraudulent Economic Injury Disaster Loans, and more than $2.4 million in fraudulent automobile loans. He also agreed to forfeit various assets, including more than $2.1 million in seized funds, three luxury vehicles – a 2018 Mercedes-Benz S-Class S65AMG, a 2018 Land Rover Range Rover, and a 2017 Acura NSX – and several items of jewelry, including a gold Rolex. Darrell Thomas’s sentencing is set for Sept. 15, before Judge J.P. Boulee.
Denesseria Slaton, pleaded guilty on June 16, to one count of conspiracy to commit bank fraud wire fraud in connection with the loan obtained by Transportation Management Services Inc. Slaton’s sentencing is set for Oct. 6.
Khalil Gibran Green Sr., 47, of Cleveland, Ohio, pleaded guilty on Sept. 1, 2020, to one count of conspiracy to commit bank fraud and wire fraud in connection with the loan obtained by his business, Impact Creations LLC. On Jan. 14, Judge J.P. Boulee sentenced Green to three years and five months in prison and five years of supervised release, and ordered him to pay $830,000 in restitution and forfeiture of $157,035.71.
Bern Benoit, 45, of Burbank, California, pleaded guilty on March 11, to one count of conspiracy to commit bank fraud and wire fraud in connection with the loan obtained by his business, Transportation Management Services Inc. Benoit’s sentencing is set for Sept. 8, before Judge J.P. Boulee.
Charmaine Redding, pleaded guilty on July 14, to one count of conspiracy to commit wire fraud in connection with the loan obtained by her business, All Star Room and Board Services of Michigan Inc. Redding’s sentencing is set for Oct. 21, before Judge J.P. Boulee.
Andre Lee Gaines, 67, of Dallas, Georgia, pleaded guilty on June 17, to one count of making false statements to the FBI in connection with the loan obtained by his business, Gaines Reservation and Travel. Andre Gaines’s sentencing is set for Oct. 6, before Judge J.P. Boulee.
Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division and Acting U.S. Attorney Kurt R. Erskine of the Northern District of Georgia made the announcement.
This case is being investigated by the FBI, the U.S. Treasury Inspector General for Tax Administration, and the Small Business Administration-Office of the Inspector General.
Trial Attorney Siji Moore of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Tal Chaiken and Nathan Kitchens of the Northern District of Georgia are prosecuting the case.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Three Individuals Charged in Bribery SchemeRead the Press Release
RICHMOND, Va. –Three individuals made their initial appearances in federal court this afternoon on charges of participating in a bribery scheme.
According to the indictment, Susan May Keim, 52, and Russell John Keim, Sr., 59, of Hopewell, allegedly accepted bribes from Rodney Gale Wilson, 65, of Imperial, Missouri, in return for Susan Keim’s award of federal subcontracts to Wilson’s company, C&L Supply.
According to the indictment, Susan Keim worked for Skookum Educational Services, a company that contracted with the federal government to provide maintenance and supply services at Fort Lee. Rodney Wilson was the owner of C&L Supply, a company formed for the sole purpose of selling supplies for Skookum for use at Fort Lee. From 2013 to 2018, in return for the award of the subcontracts valued at least $912,765.89 and the supply of confidential information, Wilson allegedly provided various things of value, totaling at least $92,039.79, to Susan and her spouse, Russell Keim, including: (1) checks and cash payments to Russell Keim disguised as compensation to Russell Keim for work performed for C&L Supply, when, in fact, Russell Keim never worked for that company; and (2) payments for work done on a property owned by Susan and Russell Keim.
All three individuals are charged with conspiracy and payment, and receipt of bribes. If convicted, each defendant faces a maximum penalty of 20 years in prison. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
The defendants will be arraigned before U.S. District Judge John A. Gibney, Jr. on August 16.
Raj Parekh, Acting U.S. Attorney for the Eastern District of Virginia; Kenneth A. Polite Jr., Assistant Attorney General of the Justice Department’s Criminal Division; Stanley M. Meador, Special Agent in Charge of the FBI’s Richmond Field Office; L. Scott Moreland, Special Agent in Charge of the U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit’s (MPFU) Mid-Atlantic Fraud Field Office; and Chris Dillard, Special Agent in Charge for Department of Defense Office of Inspector General, Defense Criminal Investigative Service’s (DCIS) Mid-Atlantic Field Office, made the announcement.
Assistant U.S. Attorney Michael C. Moore of the Eastern District of Virginia and Trial Attorney Rebecca M. Schuman of the Justice Department’s Public Integrity Section are prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:21-cr-083.
An indictment is merely an accusation. The defendants are presumed innocent until proven guilty.
Tennessee Man Sentenced for Producing Child PornographyRead the Press Release
Acting United States Attorney Jan Sharp announced that Robert Lee Wright, age 38, of Cleveland, Tennessee, was sentenced today to 400 months’ imprisonment by United States District Court Judge John M. Gerrard for Production of Child Pornography and Distribution of Child Pornography. There is no parole in the federal system. After his release, Wright will be on supervised release for life and be required to register as a sex offender. Additionally, Wright was ordered to pay $66,000 in restitution.
On December 23, 2018, Wright was the passenger in a rental vehicle stopped by the Nebraska State Patrol in Hamilton County, Nebraska. A search of the vehicle was conducted and 95 electronic devices and storage devices were recovered from within the vehicle. One of these devices was Wright’s Samsung Galaxy J3 cellular phone, which contained a microSD memory card. Wright was arrested on unrelated state charges immediately following the search of the vehicle and he was interviewed on December 23, 2018. During this interview, Wright stated that all of the electronic devices were his.
On January 4, 2019, a state search warrant was obtained through the County Court of Hamilton County, Nebraska by the Nebraska State Patrol to search Wright’s Samsung Galaxy J3. A review of a microSD card from the Samsung Galaxy J3 cellular phone located more than 700 images of child pornography. Additionally, a video located of Wright filming himself engaging in sexually explicit conduct with an infant girl who was confirmed to be approximately 23 months old.
While in the Hamilton County Jail, Wright gave his login information for his Gmail account to a third party in Tennessee over the phone. This allowed for that individual to access and receive the child pornography stored on the account. The FBI reviewed approximately 100 of Wright’s devices as well as his internet-based cloud accounts. This review found a total of 43,678 images and 922 videos depicting children engaging in sexually explicit conduct.
The FBI also identified and located the 23-month-old girl. The FBI and local law enforcement searched the storage unit where Wright produced the video with the 23-month-old girl which was rented by an associate of Wright’s. The FBI also located and collected sheets that were depicted in the video.
Following the sentencing, Acting United States Attorney Sharp noted, “The investigation and prosecution of Robert Wright involved extensive collaboration between our office, the FBI in Nebraska and Tennessee, and its local law enforcement partners. This collaboration is a hallmark of the Department of Justice’s commitment to protect children from sexual exploitation and abuse and to bring offenders to justice. Today’s 400-month sentence reflects the heinous nature of the crimes committed and the reality that Robert Wright is a sexual predator. Today’s sentence will ensure that Wright will not be in a position where he can prey on children again.”
After the sentencing, FBI Omaha Special Agent in Charge Eugene Kowel said, “Robert Lee Wright engaged in the most despicable of crimes, victimizing young children for his own depraved gratification. It is a priority for the FBI to use any investigative resources necessary to assist our law enforcement partners in removing criminals like Wright from our communities.”
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case was investigated by the Federal Bureau of Investigation, Papillion Police Department, Nebraska State Patrol, and the Bradley County, Tennessee Sheriff’s Office.
Tallulah Man Sentenced for Trafficking MethamphetamineRead the Press Release
MONROE, La. – Patrick Senclair Jackson, 46, of Tallulah, Louisiana, was sentenced by United States District Judge Terry A. Doughty to 120 months (10 years) in prison, followed by 5 years of supervised release, for drug trafficking.
Jackson was indicted by a federal grand jury in September 2020 and pleaded guilty on March 3, 2021 to distribution of methamphetamine and possession of a firearm in furtherance of a drug trafficking crime. The drug trafficking charges are the result of an investigation into the illegal activities of Jackson.
Law enforcement agents were familiar with Jackson’s involvement in drug trafficking as they had previously purchased methamphetamine from him in June 2019 during an undercover operation. The methamphetamine that was purchased from Jackson during the undercover operation was later sent to the crime lab and confirmed to be 8.87 grams of methamphetamine.
In November 2019, law enforcement agents initiated a traffic stop of Jackson to execute an outstanding arrest warrant on him. During the traffic stop, agents observed a revolver in the driver’s side door of the vehicle he was driving. Law enforcement agents obtained a search warrant and found 9.17 net grams of powder cocaine, 1.95 grams of crack cocaine and less than one gram of methamphetamine, and other drug paraphernalia.
The DEA, ATF, and Louisiana State Police conducted the investigation. Assistant U.S. Attorney Brandon B. Brown prosecuted the case.
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Stoneham Man Indicted for Identity Theft and Fraud Related to COVID-19 Pandemic Unemployment AssistanceRead the Press Release
BOSTON – A Stoneham man was indicted today in connection with his alleged involvement in a fraudulent scheme to obtain COVID-19-related unemployment assistance.
Daniel Maleus, 33, was indicted on one count of wire fraud, one count of conspiracy to commit wire fraud and one count of aggravated identity theft. Maleus was charged by criminal complaint and arrested on April 8, 2021.
In March 2020, in response to the global coronavirus pandemic, Congress passed the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), which among other things, created a temporary federal unemployment insurance program called Pandemic Unemployment Assistance (PUA). The PUA, which in Massachusetts is administered by the Department of Unemployment Assistance, provides unemployment insurance benefits for individuals who are not eligible for other types of unemployment benefits.
According to the charging documents, Maleus filed and conspired with others to file fraudulent PUA claims in the names of other people. It is alleged that Maleus and his co-conspirators obtained more than $250,000 in payments on fraudulent unemployment claims submitted between April 2020 and April 2021.
The charges of wire fraud and conspiracy to commit wire fraud each provide for a maximum sentence of 20 years in prison, three years of supervised release, a fine of $250,000 or twice the gross gain or loss, whichever is greater and forfeiture. The charge of aggravated identity theft provides for a mandatory sentence of two years in prison to be served consecutively to any other sentence imposed. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney Nathaniel R. Mendell; Joseph R. Bonavolanta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division; and Nikitas Splagounias, Acting Special Agent in Charge of the Department of Labor, Office of Inspector General, Office of Investigations made the announcement. Special assistance was provided by the Massachusetts Department of Unemployment Assistance. Assistant U.S. Attorney Christopher J. Markham of Mendell’s Securities, Financial & Cyber Fraud Unit is prosecuting the case.
On May 17, 2021, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the Department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud (NCDF) Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
The details contained in the charging documents are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Spring Creek Man Sentenced for Methamphetamine DistributionRead the Press Release
Acting United States Attorney Dennis Holmes announced that a Spring Creek, South Dakota, man convicted of Conspiracy to Distribute a Controlled Substance, was sentenced on July 19, 2021, by Chief Judge Roberto A. Lange, U.S. District Court.
Charles Little Elk III, a/k/a Charlie Little Elk, age 38, was sentenced to 63 months in federal prison, followed by 4 years of supervised release, a $1,000 fine, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Little Elk was indicted by a federal grand jury on July 16, 2020. He pled guilty on April 6, 2021.
The conviction stemmed from a conspiracy that occurred between January 2017 and January 2019. During this time, Little Elk conspired with several others to distribute between 350 and 500 grams of methamphetamine on the Rosebud Sioux Indian Reservation in central South Dakota.
This case was investigated by the Northern Plains Safe Trails Drug Enforcement Task Force and the Rosebud Sioux Tribe Law Enforcement Services. Assistant U.S. Meghan N. Dilges prosecuted the case.
Little Elk was immediately remanded to the custody of the U.S. Marshals Service.
South Carolina Woman Admits to Conspiracy and Fraud ChargesRead the Press Release
PITTSBURGH - A resident of Columbia, South Carolina, pleaded guilty in federal court to a charge of conspiracy to commit offenses against the United States, including theft of mail, possessing forged securities, and bank fraud, Acting United States Attorney Stephen R. Kaufman announced today.
Taylor Frierson, age 29, originally from Columbia, South Carolina, pleaded guilty to one count before United States District Judge Robert J. Colville.
In connection with the guilty plea, the court was advised that from April 2019 to July 2019, Frierson conspired with others to steal checks contained in United States mail at local businesses and other establishments. Members of the conspiracy, including Frierson, would send photographs of the legitimate checks to other conspirators who would in turn create altered, fraudulent versions of the checks. The fraudulent checks were made payable to individuals from the local area recruited by Frierson and others. Frierson also drove the individuals to cash the fraudulent checks at local banks. The conspiracy victimized more than 10 victims in Western Pennsylvania and led to tens of thousands of dollars in losses.
Judge Colville scheduled sentencing for December 2, 2021 at 11:00 am. For the conspiracy charged, the law provides for a total sentence of not more than 5 years in prison, a fine not to exceed $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
The Court ordered that Frierson be released on bond pending sentencing.
Assistant United States Attorney Brian M. Czarnecki is prosecuting this case on behalf of the government.
This case resulted from the investigations of multiple agencies, including the Pennsylvania State Police, Pennsylvania Office of Attorney General, the United States Secret Service, and the United States Postal Inspection Service.
South Bend, Indiana Woman was SentencedRead the Press Release
SOUTH BEND – Crystal Egan, age 33, of South Bend, Indiana, was sentenced before United States District Court Chief Judge Jon DeGuilio upon her pleas of guilty to Hobbs act robbery and brandishing a firearm during a crime of violence, announced Acting United States Attorney Tina L. Nommay.
Egan was sentenced to 102 months in prison followed by 3 years of supervised release.
According to documents in this case, Crystal Egan participated in 2 armed robberies, one being a bank and the other a tobacco store. Egan aided in planning the robberies and was the driver for each. At the tobacco store robbery in Mishawaka on November 18, 2019, co-defendants Armand White and Joshua Gant entered the business wearing masks and armed with handguns while she stayed behind in the car. They brandished their firearms and demanded money from the clerk. The clerk complied with their demands for money by giving them cash. Upon exiting the business, Egan and co-defendants drove to a house where the three split the proceeds.
On November 20, 2019, Egan again planned and drove co-defendants Armand White and Daniel Scott to a Federal Credit Union in South Bend to conduct a robbery. When arriving at the Credit Union, White and Scott entered with faces covered and firearms while demanding money. After obtaining the money, they fled in the vehicle driven by Egan.
On July 8, 2021 Joshua Gant was sentenced to 90 months in prison for his role in this crime. Armand White is awaiting sentencing currently scheduled for October of 2021. Daniel Scott is awaiting sentencing currently scheduled in September 2021.
The case is the result of an investigation conducted by the Federal Bureau of Investigation with the assistance of Mishawaka and South Bend Police Departments. This case was prosecuted by Assistant United States Attorney Kimberly Schultz.
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Sioux Falls Man Sentenced for Distribution of a Controlled Substance Resulting in Death or Serious Bodily InjuryRead the Press Release
Acting United States Attorney Dennis R. Holmes announced that a Sioux Falls, South Dakota, man convicted of Distribution of a Controlled Substance Resulting in Death or Serious Bodily Injury was sentenced on July 12, 2021, by U.S. District Judge Karen E. Schreier.
Ignacio Joaquim Veytia, age 24, was sentenced to 240 months in federal prison, followed by five years of supervised release, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Veytia was indicted by a federal grand jury on October 6, 2020. He pled guilty on April 21, 2021.
The conviction stemmed from an incident on or about June 18, 2019, when Veytia, knowingly and intentionally distributed fentanyl and said fentanyl resulted in the serious bodily injury of a victim. The victim smoked the fentanyl provided by Veytia and sustained an overdose, which was reversed by the administration of Narcan. Fentanyl is a Schedule II controlled substance.
This case was investigated by the Sioux Falls Police Department and Homeland Security Investigations. Assistant U.S. Attorney Jennifer D. Mammenga prosecuted the case.
Veytia was immediately turned over to the custody of the U.S. Marshals Service.
Sioux Falls Man Charged with Transportation of Child Pornography and Receipt and Distribution of Child PornographyRead the Press Release
Acting United States Attorney Dennis Holmes announced that a Sioux Falls, South Dakota, man has been indicted by a federal grand jury for Transportation of Child Pornography and Distribution of Child Pornography.
Spencer Peter Goth, age 23, was indicted on July 7, 2021. He appeared before U.S. Magistrate Judge Veronica L. Duffy on July 21, 2021, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 20 years in federal prison and/or a $250,000 fine, life of supervised release, and up to $200 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that between April 12, 2018, and December 29, 2020, Goth knowingly transported child pornography using any means, including by computer and using the internet. Goth uploaded graphic image and video files depicting one or more minors in sexually explicit conduct into his Dropbox account.
The Indictment also alleges that between May 1, 2017, and May 13, 2021, Goth knowingly received and distributed, and attempted to distribute any child pornography that had been mailed, shipped, and transported in or affecting interstate or foreign commerce by any means, including by computer.
The charges are merely accusation and Goth is presumed innocent until and unless proven guilty.
The investigation is being conducted by the South Dakota Division of Criminal Investigation and the Homeland Security Investigations. Assistant U.S. Attorney Jeffrey C. Clapper is prosecuting the case.
Goth was released on bond pending trial. A trial date has not been set.
Sentence More Than Doubled for Man Who Committed Fraud While on Pretrial Release in Separate Fraud CaseRead the Press Release
A Sweetwater man who perpetrated a $12.3 million fraud while on pretrial release in a separate fraud case had almost nine years tacked onto his sentence today, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Stewart Kile Williams, 31, pleaded guilty in March to two counts of wire fraud and two counts of engaging in monetary transactions in property derived from unlawful activity (money laundering). He was sentenced Thursday by U.S. District Judge James Wesley Hendrix to 105 months in federal prison, to be served consecutive to his existing 70 month sentence, and ordered to pay roughly $7.4 million in restitution.
According to court documents, Mr. Williams committed these crimes in late 2018 and early 2019, while on pretrial release for crimes committed in the Southern District of Texas. (He was first charged by the Southern District in summer 2018 for selling non-existent cattle to a ranch in Decatur for $2.5 million. Following an indictment, he was released on bond, but would go on to have that release revoked in late 2019 after a local arrest for theft of hay bales. He eventually pleaded guilty in to four counts of wire fraud and was sentenced to 70 months in federal prison and ordered to pay more than $2 million in restitution.)
“They say insanity is doing the same thing over and over and expecting different results. Mr. Williams wasn’t insane, but he was brazen. While on pretrial release for one fraud in south Texas, he had the audacity to perpetrate a similar fraud in north Texas. If he thought federal prosecutors would content themselves with holding him accountable in only one case, he was sorely mistaken. We will not tolerate repeated maleficence,” said Acting U.S. Attorney Prerak Shah.
“Mr. Williams’ bold actions in committing additional crimes while on pretrial release for other crimes shows his complete lack of concern for our laws or his fellow citizens and this additional sentencing is deserved,” said IRS – Criminal Investigations Special Agent in Charge Christopher J. Altemus Jr., Dallas Field Office.
In plea papers, Mr. Williams admitted that while on pretrial release, he formed AZS Trenching, an unregistered sole proprietorship that provided freight transport and trenching services in the Permian Basin. In January 2019, he entered into an agreement with Navarone Capital, a privately held factoring company that purchased outstanding invoices from businesses like AZS.
At first, everything was above-board – Mr. Williams sent Navarone invoices for work AZS performed for pipeline company M.G. Dyess, Navarone wired advance payment to his bank account, and when M.G. Dyess paid Mr. Williams, he mailed the checks to Navarone.
Two months later, however, Mr. Williams asked Navarone to factor invoices provided for work he said AZS purportedly performed for pipeline company HIS. In fact, AZS had never serviced HIS.
In order to convince Navarone that the bogus HIS invoices were legitimate, Mr. Williams assumed the identity of an HIS construction manager. He obtained a temporary cell phone with an area code that matched HIS’s, and then, posing as the HIS employee, called Navarone to assure them that AZS was indeed performing the work outlined on the invoices. He also created a fake email address through godaddy.com, purportedly belonging to the HIS employee, from which he approved the bogus invoices complemented AZS’s “work.”
Of course, when the bogus invoices came due, Mr. Williams could not pay Navarone. After months of excuses and non-payment on HIS invoices, Navarone contacted HIS headquarters. The pipeline company told Navarone they did not have, and never had, a business relationship with AZS or Mr. Williams.
In total, Mr. Williams presented 38 bogus invokes to Navarone, causing them to wire approximately $12.3 million into his bank account. He used the criminally derived proceeds to make a number of large purchases, including a home in Abilene and $500,000 in construction equipment.
Internal Revenue Service – Criminal Investigations, the United States Postal Inspection Service, and the Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. Assistant U.S. Attorney Ann Howey of the Northern District of Texas prosecuted the north Texas case with significant assistance from Assistant U.S. Attorneys William Hagen and Jason Corley of the Southern District of Texas.
Second Round of Individuals Charged with Disaster Assistance FraudRead the Press Release
LAFAYETTE, La. - Acting United States Attorney Alexander C. Van Hook announced that a federal grand jury has returned 11 separate indictments charging 11 individuals with fraudulently applying for and receiving disaster benefits from the Federal Emergency Management Agency (FEMA), which is a department of the United States Department of Homeland Security.
In August 2016, severe flooding impacted south Louisiana and a Presidential disaster declaration was issued on August 14, 2016 under the authority of the Robert T. Stafford Disaster Relief and Emergency Assistance Act. The incident period covered August 11, 2016 through August 31, 2016. FEMA was authorized to provide transportation assistance for repair or replacement of a primary vehicle damaged by the disaster.
The indictments allege that on certain dates between September 26, 2016 and November 11, 2016 each of the defendants, acting in concert with others, made false statements and representations to FEMA in an application for transportation benefits and provided certain documentation required by FEMA to process the claim in connection with the Presidential Disaster Declaration for the Louisiana Severe Storms and Flooding. Each application for Disaster Assistance was submitted on behalf of each defendant claiming their vehicle sustained flood damage in Iberia and Lafayette Parishes in Louisiana, when each of them was a resident of St. Mary Parish, Louisiana, which was not included as a designated parish for assistance.
The indictments further allege that each defendant submitted a signed letter to FEMA stating the subject vehicle belonged to the defendant, was their only means of transportation, and was no longer operable. In each case, the repair estimates submitted by each defendant, which ranged from $6,215 to $9,042, were all from repair shops that did not exist. A list of the defendants and the charges they face are as follows:
Defendant Name
Charges
Dwayne Clark, 49,
Franklin, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $6,000 to defendant
Roshawn Lewis, 31,
New Iberia, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $6,000 to defendant
Michelle Annette Kirt, 52,
Franklin, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $6,000 to defendant
Darius Juandre Stansbury, 30,
Franklin, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $5,999 to defendant
Keshawn Alonzo Gray, 24,
Berwick, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $5,999 to defendant
Kieshondra Monique Lovely, 41,
Lake Charles, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $6,000 to defendant
Juanita Dugas, 58,
Franklin, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $6,000 to defendant
Nicole Gibson, 51,
Garden City, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $5,999 to defendant
Gail Nelson, 65,
Franklin, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $5,999 to defendant
Michell Antoinette Fernandez, 40,
Franklin, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $5,999 to defendant
Eric Joseph Daniels, 37,
Franklin, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $5,999 to defendant
Nine individuals were previously indicted in related cases on April 22, 2021. Those individuals and their charges were as follows:
Defendant Name
Charges
Brittany Nicole Hawkins, 29,
Franklin, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $5,999 to defendant
Shannan Latreice Johnson, 45,
Franklin, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $5,999 to defendant
Tasha Jesse Louis, 39,
Franklin, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $6,000 to defendant
Jarnell Wayne Payne, a/k/a Jernell W. Payne, 43,
Franklin, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $5,999 to defendant
Kevin Callery, 54,
Baldwin, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $5,999 to defendant
Leo Green, Jr., 55,
Franklin, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $6,000 to defendant
Robert Joseph Johnson, Jr., 33,
Patterson, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $6,000 to defendant
Derrick Shawn Kirt, 44,
Franklin, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $5,999 to defendant
Johnathan D. Wilson, 38,
Franklin, Louisiana
- Fraud in Connection with Major Disaster or Emergency Benefits – one count
- Theft of Government Money or Property – one count
- Fraudulent repair estimate resulted in disbursement of $6,000 to defendant
An indictment is merely an accusation and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
If you have any information to report concerning potential FEMA fraud, please call the National Center for Disaster Fraud at 1-866-720-5721.
This investigation is ongoing and is being conducted by the U.S. Department of Homeland Security – Office of Inspector General. Assistant U.S. Attorney David J. Ayo is prosecuting the cases.
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Rosebud Man Sentenced for Failure to Register as a Sex OffenderRead the Press Release
Acting United States Attorney Dennis Holmes announced that a Rosebud, South Dakota, man convicted of Failure to Register as a Sex Offender was sentenced on July 19, 2021, by Chief Judge Roberto A. Lange, U.S. District Court.
Moses Left Hand Bull, age 29, was sentenced to 22 months in federal prison, followed by 5 years of supervised release, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Left Hand Bull was indicted by a federal grand jury on October 14, 2020. He pled guilty on May 17, 2021.
Left Hand Bull was convicted of Aggravated Sexual Abuse of a Minor in September 2009. As a result of this conviction, he is required to register as a sex offender and to update his registration within three business days of relocation or changing employment. In June 2020, Left Hand Bull was released from custody and began a period of supervised release. He thereafter failed to register and update his registration.
This case was investigated by the U.S. Marshals Service. Assistant U.S. Attorney Kirk Albertson prosecuted the case.
Left Hand Bull was immediately turned over to the custody of the U.S. Marshals Service.
Rochester Man Pleads Guilty to Arson of Minneapolis Pawn ShopRead the Press Release
ST. PAUL, Minn. – A Rochester man pleaded guilty today to arson of a Minneapolis pawn shop, announced Acting U.S. Attorney W. Anders Folk.
According to his guilty plea, on May 28, 2020, Montez Terriel Lee, 26, along with others, broke into the Max It Pawn Shop on East Lake Street in Minneapolis. Surveillance video footage showed Lee pouring a fire accelerant around the pawn shop and lighting the accelerant on fire. The fire destroyed the building. A second video showed Lee standing in front of the burning pawn shop and Lee could be heard saying, “[expletive] this place. We’re gonna burn this [expletive] down.”
This case is the result of an investigation conducted jointly by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the FBI, the Minneapolis Police Department, the Rochester Police Department, and the Minnesota State Fire Marshal Division.
This case is being prosecuted by Assistant U.S. Attorney Thomas Calhoun-Lopez.
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Rapid City Man Sentenced to 12 Years in Federal Prison on Robbery ChargeRead the Press Release
Acting United States Attorney Dennis R. Holmes announced that a Rapid City, South Dakota, man convicted of Interference with Commerce by Robbery and Use and Brandishing of a Firearm During the Commission of a Crime of Violence was sentenced by Jeffrey L. Viken, U.S. District Judge.
Shannon Larive, age 27, was sentenced on July 12, 2021, to 12 years in federal prison, followed by 5 years of supervised release, and was ordered to pay a $200 special assessment to the Federal Crime Victims Fund.
Between March 16, 2020, and March 21, 2020, Larive and his co-defendants were involved in the armed robbery of three casinos in Rapid City and one attempted armed robbery. During each armed robbery, Larive brandished a firearm and demanded money from an employee of the casino. Those employees, fearing injury, complied with the demands and gave the cash from the register to Larive. Larive and his co-defendants would then flee the scene. Larive was later apprehended by law enforcement following a vehicle and foot pursuit. Officers recovered dozens of .22 caliber rounds of ammunition from Larive’s vehicle, as well as a .22 caliber pistol that Larive had discarded during the foot pursuit.
This case is part of Project Safe Neighborhoods (PSN), the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
The investigation was conducted by the Bureau of Alcohol, Firearms, Tobacco, and Explosives, and the Rapid City Police Department. Assistant U.S. Attorney Benjamin Patterson prosecuted the case.
Larive was immediately remanded to the custody of the U.S. Marshals Service.
Rapid City Man Sentenced on Firearm ChargeRead the Press Release
Acting United States Attorney Dennis R. Holmes announced that a Rapid City, South Dakota, man convicted of Possession of a Firearm by a Prohibited Person was sentenced by Jeffrey L. Viken, U.S. District Judge.
Keanu Dillon, age 29, was sentenced on July 19, 2021, to 3 years in federal prison, followed by 3 years of supervised release, and was ordered to pay a $100 special assessment to the Federal Crime Victims Fund.
The conviction stems from Dillon, a previously convicted felon who is prohibited from possessing firearms, being in possession of a Taurus, model 856, .38 Special caliber, double-action revolver, which was found after Dillon came into contact with law enforcement in Rapid City in April 2020.
This case is part of Project Safe Neighborhoods (PSN), the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
The investigation was conducted by the Bureau of Alcohol, Firearms, Tobacco, and Explosives, and the Black Hills Fugitive Taskforce. Assistant U.S. Attorney Benjamin Patterson prosecuted the case.
Dillon was immediately remanded to the custody of the U.S. Marshals Service.
Rapid City Man Sentenced for Assault with a Dangerous Weapon and Failure to Register as a Sex OffenderRead the Press Release
Acting United States Attorney Dennis Holmes announced that a Rapid City, South Dakota, man convicted of Assault With a Dangerous Weapon and Failure to Register as a Sex Offender was sentenced on July 19, 2021, by Chief Judge Roberto A. Lange, U.S. District Court.
Patrick Luke Black Spotted Horse, age 32, was sentenced to 84 months in federal prison, followed by 3 years of supervised release, for Assault With a Dangerous Weapon. He was sentenced to 27 months in federal prison, followed by 5 years of supervised release, for Failure to Register as a Sex Offender. The sentences will be served concurrently. Black Spotted Horse was also ordered to pay a special assessment to the Federal Crime Victims Fund in the amount of $200.
Black Spotted Horse was indicted by a federal grand jury on August 11, 2022. He pled guilty on May 3, 2021.
The conviction for Assault With a Dangerous Weapon stemmed from an incident that occurred in Norris, South Dakota, on June 14, 2020. On that date, Black Spotted Horse was consuming alcoholic beverages and socializing with a group of individuals that included the victim, an adult male. Black Spotted Horse and the victim got into an argument, at which point Black Spotted Horse produced a knife and stabbed the victim in the chest. He then fled the scene.
Black Spotted Horse was convicted of Sexual Abuse of a Minor in March 2010. As a result of this conviction, he is required to register as a sex offender and to update his registration within three business days of relocation or changing employment. Between 2013 and 2018, Black Spotted Horse was convicted of Failure to Register as a Sex Offender on four separate occasions. In January 2020, Black Spotted Horse was released from custody and began a period of supervised release. He initially registered and resided at a residence in Rapid City. In April 2020, he moved from his registered address, but did not update his registration. His whereabouts were unknown until his arrest on June 14, 2020.
This case was investigated by the Rosebud Sioux Tribe Law Enforcement Services and the U.S. Marshals Service. Assistant U.S. Attorney Kirk Albertson prosecuted the case.
Black Spotted Horse was immediately turned over to the custody of the U.S. Marshals Service.
Raleigh County Man Pleads Guilty to Federal Drug and Gun CrimeRead the Press Release
CHARLESTON, W.Va. – A Raleigh County man pleaded guilty today to possession of 100 grams or more of heroin and possession of a firearm in furtherance of a drug trafficking offense.
According to court documents, Richard James Pfost, 38, of Beaver, was the front seat passenger in a vehicle traveling in Belle when deputies with the Kanawha County Sheriff’s Department conducted a traffic stop of the vehicle. Deputies observed marijuana in the vehicle and conducted a search of the vehicle. In the front passenger side of the vehicle where Pfost was seated, deputies located approximately 112 grams of heroin, 88 grams of methamphetamine, 11 grams of cocaine, a loaded Smith and Wesson M&P Shield 9mm pistol, and a loaded Ruger EC9 9mm pistol. Pfost also had $420 in his possession, which he admitted were drug distribution proceeds. Pfost also admitted that he intended to distribute the heroin, methamphetamine and cocaine for money, and that the firearms in his possession were to protect himself, the drugs he possessed and the drug proceeds.
Pfost is scheduled to be sentenced on December 2, 2021 and faces a mandatory minimum of ten years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney Lisa G. Johnston made the announcement and commended the investigative work of the Kanawha County Sheriff’s Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).
United States District Judge Irene C. Berger presided over the hearing. Assistant U.S. Attorney Courtney Cremeans is prosecuting the case.
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-00094.
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Provincetown Man Sentenced for Child Pornography OffensesRead the Press Release
BOSTON – A Provincetown man was sentenced today in federal court in Boston on child pornography charges.
Kerry Adams, 61, was sentenced by U.S. District Court Judge Patti B. Saris to 14 years in prison and 10 years of supervised release. On April 20, 2021, Adams pleaded guilty to one count each of distribution, receipt and possession of child pornography.
Over the course of several months in 2019, investigators engaged in a covert investigation of individuals using peer-to-peer networks for the trafficking of child pornography. In the course of that investigation, agents downloaded child pornography files on four occasions from the same computer, which was traced to Adams’s residence. On Oct. 17, 2019, investigators seized multiple devices, including laptops, thumb drives and SD cards from Adams’s residence. During the on-scene forensic review of a laptop, investigators located files containing child pornography in folders associated with peer-to-peer software installed on the computer, including the files that the undercover investigator had downloaded directly from Adams’s computer. Subsequent forensic analysis revealed hundreds of child pornography files on Adams’s devices, including images of two children known to him.
Acting United States Attorney Nathaniel R. Mendell; Frederick J. Regan, Special Agent in Charge of U.S. Secret Service in Boston; and Barnstable Police Chief Matthew Sonnabend made the announcement today. Valuable assistance was provided by Provincetown Police Department. Assistant U.S. Attorneys Lindsey E. Weinstein, of Mendell’s Criminal Division, and Anne Paruti, Mendell’s Project Safe Childhood Coordinator and Deputy Chief of the Major Crimes Unit, 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/.
Portland Man Pleads Guilty to Possessing Child PornographyRead the Press Release
PORTLAND, Maine: A Portland man pleaded guilty today in federal court to possessing child pornography, Acting U.S. Attorney Donald E. Clark announced.
According to court records, on April 29 of this year, investigators with the FBI executed search warrants for the residence and person of Andrew Hazelton, 28. Investigators encountered Hazelton just outside the residence and informed him of the warrants. He had a Samsung smartphone in his pants pocket that he provided to investigators and later unlocked. An analysis of the phone revealed a folder containing dozens of video files depicting minors, some of them prepubescent, engaging in sexually explicit conduct.
Hazelton faces a maximum of 20 years in prison, a $250,000 fine and a term of supervised release of at least five years and up to life. He will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The FBI investigated the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Department’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.justice.gov/psc.
Port Clinton Physician Convicted of Prescribing Controlled Substances Without Medical Necessity and Health Care FraudRead the Press Release
Acting U.S. Attorney Bridget M. Brennan announced that a federal jury found William R. Bauer, 84, of Port Clinton, Ohio, guilty of prescribing powerful controlled substances, including opioids, to patients without medical necessity and outside the usual course of medical practice.
Following a two-week trial, Bauer was convicted on Wednesday, July 21, 2021, of 76 counts of distribution of controlled substances and 25 counts of health care fraud. Bauer was initially indicted in August of 2019, and a superseding indictment was filed in October of 2019. The indictment was amended again in June of 2021.
Evidence presented at trial established that between 2015 and 2019, Bauer, at his practice in Bellevue, Ohio, repeatedly prescribed controlled substances including Oxycodone, Fentanyl, Morphine, and Tramadol, outside the usual course of professional practice and not for a legitimate medical purpose. The indictment focused on Bauer’s treatment of 14 patients. The evidence presented at trial showed that Bauer prescribed high doses of opioids and other controlled substances to patients without regard to any improvement in pain level, function, or quality of life; prescribed dangerous drug combinations; failed to consider a patient’s state of addiction and ignored warning signs of abuse and diversion such as patient family members stealing medications, patients frequently requesting early refills, patients losing medications and other actions.
Bauer was also convicted of health care fraud. Evidence introduced at trial established that Bauer regularly administered epidural injections and trigger point injections, without medical necessity, that failed to meet certain procedural requirements. Because these injections failed to meet the procedural requirements, they were rendered ineffective and were fraudulently billed to insurers. Evidence at trial also showed that between January 2007 and August 16, 2019, Bauer prescribed controlled substances outside the usual course of medical practice and not for a legitimate medical purpose, thus resulting in insurers paying for medically unnecessary controlled substances.
Sentencing will be determined at a later date.
This case was investigated by the Federal Bureau of Investigation, the Drug Enforcement Administration, the Department of Health and Human Services – Office of Inspector General and the Ohio Attorney General’s Office. The case is being prosecuted by Assistant U.S. Attorneys Ava R. Dustin, Michael A. Sullivan, Robert N. Melching and Payum Doroodian.
Ponchatoula Man Sentenced to 72 Months Imprisonment for Receiving Child Sexual Abuse MaterialRead the Press Release
NEW ORLEANS – U.S. Attorney Duane A. Evans announced that EDD SCAFIDEL, JR., age 62, a resident of Ponchatoula, Louisiana, was sentenced to 72 months imprisonment and payment of a mandatory $100 special assessment fee by United States District Judge Eldon E. Fallon after previously pleading guilty as charged to an Indictment charging him with receiving images and videos depicting the sexual exploitation of children, including children as young as approximately one (1) year old, in violation of Title 18 United States Code, Section 2252(a)(2). Additionally, Judge Fallon ordered that SCAFIDEL serve a five-year period of supervised release and register as a sex offender after he is released from prison, Judge Fallon also scheduled a restitution hearing in the matter on September 16, 2021.
According to court documents, in about November 2018, a complainant knowledgeable with SCAFIDEL’s actions reported to Special Agents with the Federal Bureau of Investigation that SCAFIDEL possessed electronic storage devices that contained files depicting the sexual exploitation of children. After further investigation, the FBI executed a search warrant at SCAFIDEL’s residence in Ponchatoula, Louisiana on December 4, 2018. During the execution of the search warrant, SCAFIDEL possessed a leather pouch that contained, among other items, two electronic storage devices that contained files depicting the sexual exploitation of children. Subsequent forensic analysis determined that SCAFIDEL used computers and external hard drives to search for, download, and store child pornography. In total, SCAFIDEL downloaded and saved at least 22,334 images depicting the sexual victimization of children, including children less than one year old. Among the files SCAFIDEL searched for, downloaded, and stored were some that portrayed “sadistic or masochistic conduct or other depictions of violence.” Specifically, at least one image portrayed the sexual penetration of a conscious, bound prepubescent female.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys= Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
U.S. Attorney Evans praised the work of the Federal Bureau of Investigation, with support from the Louisiana State Police. Assistant United States Attorney Jordan Ginsberg was in charge of the prosecution.
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Pittsfield Man Pleads Guilty to Distributing HeroinRead the Press Release
BOSTON – A Pittsfield man pleaded guilty today in federal court in Springfield to heroin distribution charges.
Eulises Rosado, 51, pleaded guilty to six counts of distribution of and possession with intent to distribute heroin. U.S. District Court Judge Mark G. Mastroianni scheduled sentencing for Nov. 19, 2021. Rosado was indicted in January 2019.
Rosado admitted that on six occasions between March 2017 and August 2017, he distributed heroin to a cooperating witness. On five of those occasions, Rosado sold the heroin from his home.
The charging statute provides for a sentence of up to 20 years in prison, at least three years of supervised release and a fine of up to $1 million. Sentences are imposed based upon the U.S. Sentencing Guidelines and other statutory factors
Acting United States Attorney Nathaniel R. Mendell; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Office; and Colonel Christopher Mason, Superintendent of the Massachusetts State Police, made the announcement today. Special assistance was provided by the Pittsfield, Springfield, West Springfield, Holyoke and Easthampton Police Departments. Assistant U.S. Attorney Neil L. Desroches of Mendell’s Springfield Branch Office is prosecuting the case.
Pittsburgh Man Pleads Guilty to Obstructing Pittsburgh Police during May 30, 2020 Pittsburgh ProtestRead the Press Release
PITTSBURGH - A resident of Pittsburgh, Pennsylvania, pleaded guilty to a charge of obstruction of law enforcement during civil disorder, Acting United States Attorney Stephen R. Kaufman announced today.
George Allen, 32, pleaded guilty before United States District Judge Arthur J. Schwab.
In connection with the guilty plea, the court was advised that on May 30, 2020, Allen did knowingly and willfully throw a piece of concrete at an occupied Pittsburgh police vehicle, which broke a passenger window and struck an officer, resulting in minor bruising. Allen’s actions caused the obstruction, impediment and interference of law enforcement officers engaged in the lawful performance of their official duties.
Judge Schwab scheduled sentencing for November 10, 2021. The law provides for a maximum total sentence of not more than five years in prison, a fine of $250,000 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Judge Schwab ordered that the defendant remain on bond pending sentencing,Assistant United States Attorney Jonathan D. Lusty is prosecuting this case on behalf of the government.
The Pittsburgh Bureau of Police and the Federal Bureau of Investigation conducted the investigation.
Parkersburg Man Pleads Guilty to Federal Gun CrimeRead the Press Release
CHARLESTON, W.Va. – Dennis Hutton, 33, of Parkersburg, pleaded guilty today to a federal gun crime.
According to court documents and statements made in court, law enforcement officers executed a search warrant on June 28, 2019, at a hotel room at the Quality Inn in Mineral Wells, Wood County. During the search, officers found Hutton, digital scales, quantities of suspected methamphetamine and heroin and a Smith and Wesson .38 caliber revolver. Hutton admitted to the officers he was selling the drugs to others because of the financial obligations he had. The drugs were sent to the DEA Mid-Atlantic Laboratory and were confirmed to be methamphetamine and carfentanil. Hutton admitted that he carried the gun to protect both his drugs and the proceeds of his drug dealing.
Hutton pleaded guilty to possession of a firearm in furtherance of a drug trafficking crime and faces five years and up to life in prison when he is sentenced on October 18, 2021.
Acting United States Attorney Lisa G. Johnston made the announcement and commended the investigative efforts of the Drug Enforcement Administration (DEA).
United States District Judge Joseph R. Goodwin presided over the hearing. Assistant United States Attorney L. Alexander Hamner is handling the prosecution.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 2:20-cr-00143.
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Owner of Malta’s Ellsworth Commons Agrees to Pay $805,000 and to Permanent Exclusion from Federal Housing Programs to Resolve Civil LiabilityRead the Press Release
ALBANY, NEW YORK – Eugene Rosen of Palm Beach Gardens, Florida has agreed to pay the United States $805,000 to resolve allegations that he made improper payments to his family trusts while disregarding his obligation to make payments on a federally-backed mortgage, and submitted a false statement to the U.S. Department of Housing and Urban Development’s (HUD) Federal Housing Administration (FHA) related to those payments, in violation of the civil equity skimming statute and the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA), announced Acting United States Attorney Antoinette T. Bacon.
Ellsworth Commons, a mixed use residential and commercial property in Malta, New York, was owned by Ellsworth Partners, LLC., a company that Rosen owned and operated. In 2010, Ellsworth Partners obtained an FHA-insured mortgage to finance the construction of Ellsworth Commons. FHA agreed that, if Ellsworth Partners defaulted on the mortgage, FHA would pay the outstanding balance to the lender. In exchange, Ellsworth Partners agreed to use project revenue only for FHA-authorized purposes. Transferring money to Rosen’s family trusts when the mortgage was in default was not an authorized purpose.
At various times, Ellsworth Partners borrowed money from outside sources, including from trusts that Rosen established for his family, and repaid those loans with project funds. On at least three occasions, HUD notified Rosen that Ellsworth Partners could not use project funds to repay those loans. From mid-2016 through early 2018, Ellsworth Partners stopped paying its mortgage causing it to go into default. To prevent foreclosure, FHA agreed to pay down a substantial portion of the mortgage after Rosen certified that, while the mortgage was in default, Ellsworth Partners paid to its lender all net cash remaining after project expenses had been paid. That statement was false because, as Rosen admitted in the settlement agreement, “Between April 2016 through January 2018, while the mortgage was in default, Ellsworth Partners made unauthorized payments on loans to the Rosen family trusts and another entity.”
“Eugene Rosen falsely certified that Ellsworth Partners used all available funds to pay down its federally insured mortgage on housing built for moderate income families when, in reality, he transferred some of those funds to his family’s trust accounts,” said Acting United States Attorney Antoinette T. Bacon. “Our office will continue in partnership with HUD to hold accountable those who violate affordable housing program requirements.”
The investigation and settlement were the result of a coordinated effort between the U.S. Attorney’s Office for the Northern District of New York and HUD’s Office of Regional Counsel for New York and New Jersey. The United States was represented by Assistant U.S. Attorney Adam J. Katz.
Owner of Brooklyn Ambulance Service Business Pleads Guilty to Not Paying Employment TaxesRead the Press Release
A New York ambulance service business owner pleaded guilty on July 20 to failure to pay employment taxes.
According to court documents and admissions made in court, Steven J. Kwestel, of Lawrence, owned and operated Courtesy Transportation Inc. (Courtesy Transportation), a Brooklyn business that provided ambulance services. As the person who exercised control over Courtesy Transportation’s financial and business operations, Kwestel had a duty to truthfully account for and pay over to the IRS payroll taxes owed by its employees. From 2013 through 2019, Kwestel withheld employment taxes from his employees’ paychecks but did not pay over to the IRS $1,302,841 in taxes owed. Rather than paying the taxes due to the IRS, Kwestel used corporate funds to make hundreds of thousands of dollars of expenditures for his and his family’s personal benefit.
Kwestel is scheduled to be sentenced on Oct. 20 and faces a maximum penalty of five years in prison. He also faces a period of supervised release, restitution and monetary penalties. As part of his plea agreement, Kwestel has agreed to pay back over $1.2 million. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division made the announcement.
IRS Criminal Investigation is investigating the case.
Trial Attorneys Shawn Noud and Anahi Cortada of the Tax Division are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website at www.justice.gov/tax.
Off-duty federal law enforcement officer admits threatening three Blackfeet tribal employees with assault rifleRead the Press Release
GREAT FALLS – An off-duty federal law enforcement officer accused of pointing an assault rifle at three Blackfeet tribal employees who were testing water on his property admitted simple assault charges today, Acting U.S. Attorney Leif M. Johnson said.
Harrison Garrett Alvarez, 30, of Cut Bank, who is a Customs and Border Protection officer, pleaded guilty to three counts of simple assault as charged in a superseding information. Alvarez faces a maximum six months in prison, a $5,000 fine and one year of supervised release on each count. In a plea agreement in the case, the parties concur that a five-year term of probation is appropriate.
Chief U.S. District Judge Brian M. Morris presided. Sentencing was set for Nov. 18. Alvarez was released pending further proceedings.
In court documents filed in the case, the government alleged that on July 24, 2019, three employees of the Blackfeet Tribe’s Environmental Office went to Alvarez’s property outside of Cut Bank, and within the Blackfeet Indian Reservation, to field test water in Cut Bank Creek. The victims, who are tribal members, traveled by truck past Alvarez’s house to the creek. The trip was the victims’ fourth time to that testing site that season, having sought, and they believed received, permission for the testing from Alvarez’s wife.
The government alleged that as the victims were collecting water samples, a rifle shot rang out. The victims saw Alvarez approaching, pointing an assault rifle at them and yelling. Alvarez demanded to know what they were doing and who had given them permission to be there. When the victims explained that his wife had given them permission to collect samples, Alvarez disputed that fact. Even after they told him they would go, Alvarez, while still leveling the rifle at the victims, ordered them closer to him and demanded they drop their equipment. When Alvarez finally allowed the victims to leave, he told them that now they knew he “shoots first, asks questions later.” All three victims believed Alvarez was going to shoot them.
The government further alleged that Alvarez disputed the victims had permission to be on the property but admitted to discharging the rifle before holding them at gunpoint and ordering them to leave his property. Alvarez’s wife remembered that the victims had sought permission but told law enforcement she had told them they needed to speak with Alvarez. Upon seeing the truck on the morning of the incident, Alvarez’s wife told him that it was probably “the water people.”
Assistant U.S. Attorney Kalah A. Paisley is prosecuting the case, which was investigated by the Glacier County Sheriff’s Office, FBI and Blackfeet Law Enforcement Services.
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Nine San Diego Residents Charged with Submitting Fraudulent Pandemic Unemployment Insurance Claims and Drug Crimes in Two CasesRead the Press Release
For Further Information, Contact:
Assistant U. S. Attorneys Stephen Wong (619-546-9464), Larry Casper (619-546-6734), Alicia Williams (619-546-8917) and Courtney Strange (760-355-2216)
San Diego County residents were charged in two separate indictments with Conspiracy to Commit Wire Fraud involving fraudulent Pandemic Unemployment Insurance claims.
CLICK HERE for Notice of Related CaseAs part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020, Congress provided new unemployment benefits for those affected by the COVID-19 Pandemic who would not otherwise qualify for unemployment insurance. In California, the Employment Development Department (EDD) administers unemployment insurance benefits.
In case number 21-CR-2154-CAB, Defendants Matthew Lombardo, Konrad Piekos, Ryan Genetti, and Dobrila Milosavljevic were charged with conspiracy to commit wire fraud. Defendants Lombardo, Piekos, and Genetti were also charged with Aggravated Identity Theft. In addition, Defendant Lombardo was charged with unauthorized disclosure of health information, a felony.
According to the affidavit filed in support of the criminal complaint related to case number 21-CR-2154-CAB, Defendant Lombardo, while employed by a local hospital, stole confidential patient files, and provided them to co-defendants Piekos, Genetti, and Milosavljevic, to submit to EDD for Pandemic Unemployment Insurance benefits.
CLICK HERE for unsealed complaintIn case number 21-CR-2153-CAB, Defendants Lindsay Renee Henning, Garrett Carl Tuggle, Salvatore Compilati, and Ryan David Genetti, were charged with conspiracy to commit wire fraud. Defendants Henning and Tuggle were also charged with aggravated identity theft, and Defendants Henning, Tuggle, and Juan Landon were also charged with conspiracy to distribute MDMA and LSD. Defendant Tuggle was also charged with possessing methamphetamine, cocaine, and heroin with intent to distribute.
According to the affidavit filed in support of the criminal complaint related to case number 21-CR-2153-CAB, the wire fraud conspiracy involved over 108 separate claims that together paid out $1,615,000. The affidavit also describes how defendants conspired to distribute controlled substances.
CLICK HERE for unsealed complaintThe charges are the product of investigations jointly undertaken by the Drug Enforcement Administration (DEA), the U.S. Department of Labor, Office of Investigations (DOL-OI), the San Diego Sheriff’s Department (SDSD), the California Employment Development Department Office of Investigations (EDD OI), United States Postal Inspection Service (USPIS), and Homeland Security Investigations (HSI). Investigators initiated investigations in both cases after traffic stops led to the discovery of contraband and text messages on cellular phones laying out the schemes. The text messages were corroborated through court-authorized searches of phones and residences and by a detailed analysis of EDD databases.
All defendants except for Juan Landon have made their initial appearance in federal court.
"Pandemic unemployment insurance programs are a critical part of our safety net designed to support hardworking citizens who are suffering during an unprecedented economic downturn. Our office and our law enforcement partners will investigate and prosecute individuals who attempt to steal from these programs designed to assist deserving recipients," said Acting U.S. Attorney Randy Grossman. Grossman commended AUSAs Wong, Casper, Williams, and Strange and the law enforcement agents who investigated these matters.
If you think you are a victim of COVID-19 fraud, immediately report it the FBI (visit ic3.gov, tips.fbi.gov, or call 1-800-CALL-FBI or the San Diego FBI at 858-320-1800.
In addition, the public is urged to report suspected fraud schemes related to COVID-19 by calling the National Center for Disaster Fraud (NCDF) hotline (1-866-720-5721) or by e-mailing the NCDF at [email protected].
Case Number : 21-CR-2154-CABDEFENDANTS
Konrad Piekos Age: 43, Vista, CA
Matthew George Lombardo Age: 52, San Diego, CA
Ryan David Genetti Age: 38 Vista, CA
Dobrila "Bebe" Milosavljevic Age: 40 Vista, CA
SUMMARY OF CHARGES
Count 1: Title 18, United States Code, section 1349 (conspiracy to commit wire fraud)
Maximum penalty: 20 years in prison; fine; penalty assessment
Counts 2 and 3: Title 18, United States Code, section 1028A; (aggravated identity theft)
Maximum penalty: 2 year mandatory minimum term of imprisonment, consecutive to any term of imprisonment imposed for Count 1.
Count 4: Title 42, United States Code, section 1320d-9(b)(3); (wrongful disclosure of individually identifiable health information)
Maximum penalty: 10 years in prison; fine; penalty assessment
AGENCIES
U.S. Drug Enforcement Administration (DEA)
U.S. Department of Labor, Office of the Investigations (DOL-OI)
California Employment Development Department Office of Investigations (EDD-OIG)
California Department of Corrections and Rehabilitation-Investigative Services Unit (CDCR-ISU)
United States Postal Inspection Service (USPIS)
Homeland Security Investigations (HSI).
Case Number : 21-CR-2153-CAB
DEFENDANTS
Lindsay Renee Henning Age: 37 La Mesa, CA
Garret Carl Tuggle Age: 35 San Diego, CA
Salvatore Compilati Age: 39 La Mesa, CA
Ryan David Genetti Age: 38 Vista, CA
Juan Landon Age: 27 Mesa, AZ
SUMMARY OF CHARGES
Counts 1 and 2: Title 21, United States Code, sections 841 and 846 (conspiracy to distribute MDMA and conspiracy to distribute LSD)
Maximum penalty: mandatory minimum 5 years and up to 40 years in prison; fine; penalty assessment
Count 3: Title 18, United States Code, section 1349 (conspiracy to commit wire fraud)
Maximum penalty: 20 years in prison; fine; penalty assessment
Count 4: Title 18, United States Code, section 1028A; (aggravated identity theft)
Maximum penalty: 2 year mandatory minimum term of imprisonment, consecutive to any term of imprisonment imposed for Count 1.
Counts 5 - 7: Title 21, United States Code, section 841 (possession with intent to distribute methamphetamine, cocaine, and heroin)
Maximum penalties:
Count 5 (more than 500 grams of a mixture containing methamphetamine) mandatory minimum 10 years and up to life in prison; fine; penalty assessment
Count 6 (cocaine) up to 20 years in prison and up to life in prison; fine; penalty assessment
Count 7 (heroin) up to 20 years in prison and up to life in prison; fine; penalty assessment
AGENCIESU.S. Drug Enforcement Administration (DEA)
San Diego Sheriff’s Department (SDSD)
U.S. Department of Labor, Office of Investigations (DOL-OI)
California Employment Development Department Office of Investigations (EDD-OIG)
California Department of Corrections and Rehabilitation-Investigative Services Unit (CDCR-ISU)
United States Postal Inspection Service (USPIS)
Homeland Security Investigations (HSI).
*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Nine Individuals Charged in Superseding Indictment with Conspiring to Act as Illegal Agents of the People’s Republic of ChinaRead the Press Release
A federal grand jury in New York filed an indictment today charging nine defendants with acting and conspiring to act in the United States as illegal agents of the People’s Republic of China (PRC) without prior notification to the Attorney General, and engaging and conspiring to engage in interstate and international stalking. Two of the nine defendants are also charged with obstruction of justice and conspiracy to obstruct justice.
According to court documents, Tu Lan, 50, and Zhai Yongqiang, 46, both of China, are the latest two of nine charged in the superseding indictment. Co-defendants Hu Ji, 46 and Li Minjun, 65, both of China; Zhu Feng, 34, a Chinese national residing in Queens, New York; Michael McMahon, 53, of Mahwah, New Jersey; Zheng Congying, 24, of Brooklyn, New York; and Zhu Yong, aka Jason Zhu, 64, of Norwich, Connecticut, were previously charged in a related criminal complaint issued in October 2020 and a related indictment in May 2021. The name of the ninth defendant remains under seal.
According to court documents, the defendants allegedly acted at the direction and under the control of PRC government officials, conducted surveillance of and engaged in a campaign to harass, stalk and coerce certain residents of the United States to return to the PRC as part of a global, concerted and extralegal repatriation effort known as “Operation Fox Hunt.” The superseding indictment also alleges that Tu Lan, a new defendant who was employed as a prosecutor with the Hanyang People’s Procuratorate, traveled to the United States, directed the harassment campaign and ordered a co-conspirator to destroy evidence to obstruct the criminal investigation.
“Law enforcement officials around the world act according to a professional code of conduct,” said Acting Attorney General Mark Lesko for the Justice Department’s National Security Division. “They act to enforce the law, not to violate it in such an egregious manner. That aprosecutor and police officer not only directed and participated in a criminal scheme on U.S. soil, but then attempted to cover it up, is an affront to justice of the highest order.”
“As alleged, the defendants, acting as agents of the PRC, carried out an illegal and clandestine campaign to harass and threaten targeted U.S. residents in order to force them to return to the PRC,” said Acting U.S. Attorney Jacquelyn M. Kasulis. “Unregistered, roving agents of a foreign power are not permitted to engage in secret surveillance of U.S. residents on American soil, and their illegal conduct will be met with the full force of U.S. law. To the extent the PRC seeks to repatriate its citizens to the PRC, its agents are required to register with the Attorney General of the United States, coordinate with U.S. officials, and adhere to U.S. laws and protocols.”
"As noted in the superseding indictment, the Chinese government sent operatives to America to harass, surveil, and coerce U.S. residents to return to China. These acts are undemocratic, authoritarian, and contrary to the rule of law," said Assistant Director Alan E. Kohler, for the FBI’s Counterintelligence Division. “The FBI will continue to protect those who are victims of harassment and intimidation by the government of China, or any other government practicing these tactics.”
As alleged, in and around 2012 and 2014, the PRC government caused the International Criminal Police Organization, aka Interpol, an inter-governmental law enforcement organization, to issue “Red Notices” for John Doe #1 and his wife, Jane Doe #1. According to the Red Notices, John Doe #1 was wanted by the PRC government for “embezzlement, abuse of power [and] acceptance of bribes” which carried a maximum possible penalty of death under PRC law. Jane Doe #1 was wanted by the PRC government for “accepting bribes” which carried a maximum possible penalty of life imprisonment under PRC law.
As alleged, the nine defendants participated in an international campaign to threaten, harass, surveil and intimidate John Doe #1 and his family, in order to force John Doe #1 and Jane Doe #1 to return to the PRC as part of “Operation Fox Hunt,” a PRC Ministry of Public Security initiative to locate and repatriate alleged Chinese “fugitives” who had fled to foreign countries, including the United States. Instead of operating with the approval and coordination of the U.S. government, PRC government officials carrying out Operation Fox Hunt traveled to the United States and directed non-official operatives in the United States to engage in violations of U.S. criminal law. Specifically, between approximately 2016 and 2019, PRC government officials, including defendant Tu Lan, the PRC prosecutor, and Hu Ji, a PRC police officer with the Wuhan Public Security Bureau, traveled to the United States and directed other defendants to engage in unsanctioned and illegal conduct on behalf of the PRC to coerce the targeted victims to return to the PRC.
As further alleged in the superseding indictment, a centerpiece of this criminal scheme was an April 2017 effort, directed by PRC officials Tu Lan and Hu Ji, to transport John Doe #1’s elderly father from the PRC to the United States to convey a threat to John Doe #1 that his family in the PRC would be harmed if he did not return to the PRC. At the direction of Tu Lan, Hu Ji and others, several defendants worked to investigate, surveil and locate John Doe #1 and his wife. Tu Lan then traveled to the United States along with John Doe #1’s father and a medical doctor, Li Minjun. While in the United States, Tu Lan directed several conspirators to surveil John Doe #1 and his family so the defendants would know where to bring John Doe #1’s father to deliver the demand that John Doe #1 return to the PRC. Afterwards, Tu Lan returned to the PRC, where she continued to supervise the operation with Hu Ji and other PRC officials, directed other U.S.-based conspirators to continue stalking John Doe #1 and then ordered the return of John Doe #1’s father to the PRC after their attempts to render John Doe #1 and Jane Doe #1 were unsuccessful.
Zhu Feng, Hu Ji and Zhu Yong worked with McMahon, a private investigator, to gather intelligence about and locate John Doe #1 and Jane Doe #1. To evade detection and frustrate a criminal investigation of their conduct, Tu Lan allegedly directed one of the conspirators to “delete all the chat content” between the conspirators. Subsequently, between 2017 and 2019 other defendants continued to harass and stalk the victims at the direction of the PRC government.
For example, on or about Sept. 4, 2018, two defendants drove to the New Jersey residence of John Doe #1 and Jane Doe #1 and pounded on the front door. The two defendants attempted to force open the door to the residence, then left a note at the residence that stated “If you are willing to go back to the mainland and spend 10 years in prison, your wife and children will be all right. That’s the end of this matter!”
All defendants are charged with acting as and conspiring to act as agents of the PRC, which carry maximum penalties of ten years and five years in prison respectively. The defendants are also charged with interstate stalking and conspiring to engage in interstate stalking, which carry a maximum penalty of five years in prison for each charge. Defendants Tu and Zhu are separately charged with obstruction of justice and conspiracy to obstruct justice, which carry a maximum penalty of 20 years in prison for each charge. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant U.S. Attorneys Craig R. Heeren, J. Matthew Haggans and Ellen H. Sise are prosecuting the case, with assistance from Trial Attorney Scott A. Claffee of the National Security Division’s Counterintelligence and Export Control Section.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Nine Individuals Charged in Superseding Indictment with Conspiring to Act as Illegal Agents of the People’s Republic of ChinaRead the Press Release
A superseding indictment was filed today in federal court in Brooklyn charging nine defendants with acting and conspiring to act in the United States as illegal agents of the People’s Republic of China (PRC) without prior notification to the Attorney General, and engaging and conspiring to engage in interstate and international stalking. Two defendants, Tu Lan and Zhu Feng, were also charged with obstruction of justice and conspiracy to obstruct justice arising out of the same course of conduct. The defendants, allegedly acting at the direction and under the control of PRC government officials, conducted surveillance of and engaged in a campaign to harass, stalk and coerce certain residents of the United States to return to the PRC as part of a global, concerted and extralegal repatriation effort known as “Operation Fox Hunt.” In addition to the six defendants previously charged in a related criminal complaint in October 2020 and a related indictment in May 2021, the superseding indictment alleges that Tu Lan, a new defendant who was employed as a prosecutor with the Hanyang People’s Procuratorate, traveled to the United States, directed the harassment campaign and ordered a coconspirator to destroy evidence to obstruct the criminal investigation.
Defendants Tu Lan, Hu Ji, Li Minjun, Zhai Yongqiang and Zhu Feng remain at large. Co-defendants Michael McMahon, Zheng Congying and Zhu Yong will be arraigned in the Eastern District of New York at a later date. The name of the ninth defendant remains under seal.
Jacquelyn M. Kasulis, Acting United States Attorney for the Eastern District of New York; Mark J. Lesko, Acting Assistant Attorney General for National Security; George M. Crouch, Jr., Special Agent-in-Charge, Federal Bureau of Investigation, Newark Field Office (FBI); Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI); and Keith Byrne, Special Agent-in-Charge, U.S. Department of State’s Diplomatic Security Service, New York Field Office (DSS), announced the superseding indictment.
“As alleged, the defendants, acting as agents of the PRC, carried out an illegal and clandestine campaign to harass and threaten targeted U.S. residents in order to force them to return to the PRC. Unregistered, roving agents of a foreign power are not permitted to engage in secret surveillance of U.S. residents on American soil, and their illegal conduct will be met with the full force of U.S. law,” stated Acting U.S. Attorney Kasulis. “To the extent the PRC seeks to repatriate its citizens to the PRC, its agents are required to register with the Attorney General of the United States, coordinate with U.S. officials, and adhere to U.S. laws and protocols.” Ms. Kasulis also extended her thanks and appreciation to the FBI’s Newark and Los Angeles field offices for their work on the case.
“Law enforcement officials around the world act according to a professional code of conduct,” stated Acting Attorney General Lesko. “They act to enforce the law, not to violate it in such an egregious manner. That a prosecutor and police officer not only directed and participated in a criminal scheme on U.S. soil, but then attempted to cover it up, is an affront to justice of the highest order.”
“Today's announcement serves to highlight the efforts of the FBI and its law enforcement partners to tirelessly and aggressively continue to utilize all available investigative tools and methods at their disposal to combat any illegal intrusions by the Chinese government to unilaterally undermine our economy and our free markets, stated FBI Special Agent-in-Charge Crouch, Newark Field Office. “The FBI remains committed to holding actors from the People's Republic of China accountable when they direct criminal activity on U.S. soil. Further, the FBI will vigorously defend the American ideals of freedom and the rule of law against any foreign malign influence actors.”
“HSI, with its law enforcement partners, will outfox attempts to circumvent our laws, undermine our national security, and target U.S. residents,” stated HSI Special Agent-in-Charge Fitzhugh. “The defendants will now face the true justice they denied their victims.”
“This is a perfect illustration of the domestic and global reach of the Diplomatic Security Service and our ability to partner with U.S. prosecutorial and law enforcement agencies on complex international, multi-jurisdictional cases,” stated DSS Special Agent-in-Charge Byrne. “DSS will continue to work closely with the United States Attorney’s Office and its law enforcement colleagues to detect and deter similar illegal activities that occur at home and abroad.”
In and around 2012 and 2014, the PRC government caused the International Criminal Police Organization (also known as “Interpol”), an inter-governmental law enforcement organization, to issue “Red Notices” for John Doe #1 and his wife, Jane Doe #1. According to the Red Notices, John Doe #1 was wanted by the PRC government for “embezzlement, abuse of power [and] acceptance of bribes” which carried a maximum possible penalty of death under PRC law. Jane Doe #1 was wanted by the PRC government for “accepting bribes” which carried a maximum possible penalty of life imprisonment under PRC law.
As alleged in the indictment, the nine defendants participated in an international campaign to threaten, harass, surveil and intimidate John Doe #1 and his family, in order to force John Doe #1 and Jane Doe #1 to return to the PRC as part of “Operation Fox Hunt,” a PRC Ministry of Public Security initiative to locate and repatriate alleged Chinese “fugitives” who had fled to foreign countries, including the United States. Instead of operating with the approval and coordination of the U.S. government, PRC government officials carrying out Operation Fox Hunt traveled to the United States and directed non-official operatives in the United States to engage in violations of U.S. criminal law. Specifically, between approximately 2016 and 2019, PRC government officials, including defendant Tu Lan, a PRC prosecutor with the Hanyang People’s Procuratorate, and Hu Ji, a PRC police officer with the Wuhan Public Security Bureau, traveled to the United States and directed other defendants to engage in unsanctioned and illegal conduct on behalf of the PRC to coerce the targeted victims to return to the PRC.
As further alleged in the superseding indictment, a centerpiece of this criminal scheme was an April 2017 effort, directed by PRC officials Tu Lan and Hu Ji, to transport John Doe #1’s elderly father from the PRC to the United States to convey a threat to John Doe #1 that his family in the PRC would be harmed if he did not return to the PRC. At the direction of Tu Lan, Hu Ji and others, several defendants worked to investigate, surveil and locate John Doe #1 and his wife. Tu Lan then traveled to the United States along with John Doe #1’s father and a medical doctor, Li Minjun. While in the United States, Tu Lan directed several conspirators to surveil John Doe #1 and his family so the defendants would know where to bring John Doe #1’s father to deliver the demand that John Doe #1 return to the PRC. Afterwards, Tu Lan returned to the PRC, where she continued to supervise the operation with Hu Ji and other PRC officials, directed other U.S.-based conspirators to continue stalking John Doe #1 and then ordered the return of John Doe #1’s father to the PRC after their attempts to render John Doe #1 and Jane Doe #1 were unsuccessful. Zhu Feng, Hu Ji and Zhu Yong worked with McMahon, a private investigator, to gather intelligence about and locate John Doe #1 and Jane Doe #1. To evade detection and frustrate a criminal investigation of their conduct, Tu Lan allegedly directed one of the conspirators to “delete all the chat content” between the conspirators. Subsequently, between 2017 and 2019, other defendants continued to harass and stalk the victims at the direction of the PRC government.
For example, on September 4, 2018, two defendants drove to the New Jersey residence of John Doe #1 and Jane Doe #1 and pounded on the front door. The two defendants attempted to force open the door to the residence, then left a note at the residence that stated, “If you are willing to go back to the mainland and spend 10 years in prison, your wife and children will be all right. That’s the end of this matter!”
The charges in the indictment are allegations, and the defendants are presumed innocent unless and until proven guilty. If convicted, the defendants face a maximum of 10 years’ imprisonment for acting as unregistered agents of the PRC, five years’ imprisonment for conspiring to act as unregistered agents of the PRC, five years’ imprisonment for interstate stalking, and five years’ imprisonment for conspiring to engage in interstate stalking. Defendants Tu Lan and Zhu Feng, who are separately charged with obstruction of justice and conspiracy to obstruct justice, face a maximum sentence of 20 years in prison if convicted of either of those crimes.
The government’s case is being handled by the Office’s National Security and Cybercrime Section. Assistant United States Attorneys Craig R. Heeren, J. Matthew Haggans and Ellen H. Sise are in charge of the prosecution, with assistance from Trial Attorney Scott A. Claffee of the National Security Division’s Counterintelligence and Export Control Section.
New Defendants:
TU LAN
Age: 50
People’s Republic of ChinaZHAI YONGQIANG
Age: 46
California; People’s Republic of ChinaDefendants Previously Indicted:
HU JI
Age: 46
People’s Republic of ChinaLI MINJUN
Age: 65
People’s Republic of ChinaZHU FENG
Age: 34
Queens, New York; People’s Republic of ChinaMICHAEL MCMAHON
Age: 53
Mahwah, New JerseyZHENG CONGYING
Age: 24
Brooklyn, New YorkZHU YONG, also known as “Jason Zhu”
Age: 64
Norwich, ConnecticutE.D.N.Y. Docket No. 21-CR-265 (S-1) (PKC)
New York Man Pleads to Passport Fraud Conspiracy and Aggravated Identity TheftRead the Press Release
NEW ORLEANS – U.S. Attorney Duane A. Evans announced that THIERNO O. BAH, age 30, a resident of New York, New York, pleaded guilty on July 21, 2021 to passport fraud conspiracy and aggravated identity theft before U.S. District Judge Sarah S. Vance. BAH is the second and final defendant to plead guilty in this case arising from an arrest in Metairie, Louisiana on February 19, 2020. BAH’s codefendant, Manuela Gonzalez-Bookman, also of New York, previously pleaded guilty in this case.
According to court documents, BAH and Gonzalez-Bookman flew from Newark Liberty International Airport to Louis Armstrong International on February 18, 2020. The following day they drove a rental car to a Capital One branch in Metairie. Gonzalez-Bookman entered the bank while BAH waited in the car outside. Gonzalez-Bookman then attempted to cash a stolen check while using a false passport card in the name of another person. When bank employees became suspicious, they called Jefferson Parish Sheriff’s deputies who arrested the pair. Federal agents subsequently determined that BAH and Gonzalez-Bookman had executed the scheme at several other bank branches while using stolen identities. The two individuals had even taken a prior trip to New Orleans on January 31, 2020, where they executed or attempted to execute at least seven fraudulent transactions, including a failed attempt to withdraw $18,600.00 in cash from one victim’s account.
Court documents further detailed how agents developed additional evidence connecting BAH to further fraud. Agents searched BAH’s phone after obtaining a search warrant and found additional stolen credit card numbers along with identities. In one example, BAH’s phone contained a photo of a handwritten note that included a victim’s name, address, social security number, date of birth, current account balance, and last transaction from the victim’s bank account. Agents used this information to corroborate further fraud committed by BAH.
Agents also learned that BAH had pending charges in the Supreme Court for New York, Bronx County. As set forth in BAH’s factual basis, he was pulled over by NYPD officers on July 31, 2019. During the traffic stop, BAH provided a fake ID to officers. The officers also observed credit card skimming paraphernalia in his vehicle. Officers subsequently seized a total of 29 credit cards, three drivers’ licenses, and a card skimming device. The Bronx District Attorney’s Office obtained an indictment charging BAH with 30 counts of criminal possession of a forged instrument second degree, 30 counts of criminal possession of a forged instrument second degree, one count of criminal possession of forgery devices, and one count of unlawful possession of a skimmer device in the second degree.
As to Count 1, passport fraud conspiracy, BAH faces a maximum sentence of five years in prison, a maximum $250,000.00 fine, and up to three years of supervised release. As to Count 3, aggravated identity theft, BAH faces a mandatory term of two years in prison that must be served consecutively to any other sentence, a maximum $250,000.00 fine, and up to one year of supervised release. Judge Vance scheduled sentencing for December 1, 2021.
The investigation is being handled by the U.S. Diplomatic Security Service and Homeland Security Investigations. U.S. Attorney Evans extended his thanks to the Jefferson Parish Sheriff’s Office and the Jefferson Parish District Attorney’s Office for their assistance. U.S. Attorney Evans also thanked the Bronx District Attorney’s Office and the New York Police Department for their contribution to this successful prosecution. Assistant United States Attorneys Matthew R. Payne, K. Paige O’Hale, and J. Ryan McLaren are in charge of the prosecution.
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New Orleans Company Pleads Guilty to False Statements ChargesRead the Press Release
NEW ORLEANS, LOUISIANA – United States Attorney Duane A. Evans announced today that B XPRESS-ELYSIAN FIELDS, LLC., a company that did business in New Orleans, entered a guilty plea on July 14, 2021 to making false statements in connection with a worksite employment investigation, in violation of Title 18, United States Code, Section 1001(a)(2).
In November 2015, Homeland Security Investigations received information that undocumented workers were possibly being employed at B XPRESS-ELYSIAN FIELDS, LLC. Based on that information, a worksite enforcement investigation was initiated in conjunction with the United States Department of Labor, Office of Inspector General.
Interviews were conducted of employees of the business and agents reviewed payroll records for a number of years. On August 11, 2016, Department of Labor, Wage and Hour investigators arrived at the company’s location on Elysian Fields Avenue and identified themselves to the corporate representative, who identified himself as the person in charge of operations and activities at B XPRESS-ELYSIAN FIELDS, LLC. He confirmed that he was qualified to answer questions about business operations, including matters related to business operations, personnel, hours worked by staff, and payments made to workers. The investigation also revealed that this corporate representative met the definition of an employer as defined in section 3(d) of the FLSA since he performed duties which included but were not limited to: hiring and firing workers; assigning work to workers; setting and adjusting pay rates for workers; monitoring the performance of workers; determining whether work performance was acceptable.
On behalf of B XPRESS-ELYSIAN FIELDS, LLC., the representative admitted to providing materially false statements to the agents. These materially false statements included that the company did not utilize a timekeeping system to record the hours that employees actually worked, that some workers were classified as independent contractors and that workers did not work more than 30 hours per week. The agents subsequently located records that proved that workers did in fact record their hours of work using the timekeeping system required by and maintained by the company. Interviews of employees also showed that workers did in fact routinely work in excess of 30 hours per week, with many staff members working significant numbers of overtime hours, which are defined by the Fair Labor Standards Act (FLSA) as hours worked in excess of 40 per work week.
The company faces up to 5 years of probation, a fine of up to $500,000 and a $100 mandatory special assessment fee. United States District Court Judge Martin L.C. Feldman set sentencing for October 13, 2021.
U.S. Attorney Evans praised the work of Homeland Security Investigations and the United States Department of Labor, Office of the Inspector General in investigating this matter. Assistant United States Attorney Jon Maestri is in charge of the prosecution.
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New Haven Gang Member Sentenced to 27 Months in Federal Prison for Illegal Gun PossessionRead the Press Release
Leonard C Boyle, Acting United States Attorney for the District of Connecticut, announced that JAQUAN GRAY, 27, of New Haven, was sentenced today by U.S. District Judge Robert N. Chatigny to 27 months of imprisonment, followed by three years of supervised release, for illegally possessing a loaded firearm. Pursuant to the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), the sentencing occurred via videoconference.
This prosecution is part of a coordinated federal, state and local law enforcement effort to address rising gun violence in New Haven. Participating in this effort are the New Haven Police Department; the FBI’s New Haven Safe Streets/Gang Task Force; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the Drug Enforcement Administration; the New Haven State’s Attorney’s Office, and the U.S. Attorney’s Office.
According to court documents and statements made in court, on July 31, 2020, law enforcement received information that several members of the “Exit 8” group were in possession of firearms near the entrance of the Essex Townhouses complex at 1134 Quinnipiac Avenue in New Haven. Members of the New Haven Police and the FBI’s New Haven Safe Streets/Gang Task Force entered the housing complex at approximately 10 p.m. and identified several Exit 8 members, including Gray. Gray ran from the scene as law enforcement arrived and ignored commands to stop. He was quickly apprehended, and a search of a fanny pack he was wearing revealed a loaded Smith and Wesson Model 469, 9mm handgun.
The handgun seized from Gray was reported stolen in Hamden in 2018, and the National Integrated Ballistic Information Network (NIBIN) determined that it was used in a shooting between rival gangs in New Haven on July 14, 2020, 17 days before it was recovered.
Gray’s criminal history includes state felony convictions for firearm and drug offenses. It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
Gray has been detained since his federal arrest on September 1, 2020. On April 30, 2021, he pleaded guilty to possession of a firearm by a felon.
This case was prosecuted by Assistant U.S. Attorney Patricia Stolfi Collins.
Acting U.S. Attorney Boyle noted that this prosecution is a part of the Justice’s Department’s Project Safe Neighborhoods (PSN) program and Project Longevity. PSN, the centerpiece of the Department of Justice’s violent crime reduction efforts, 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.
Project Longevity is a comprehensive initiative to reduce gun violence in Connecticut’s major cities. Through Project Longevity, community members and law enforcement directly engage with members of groups that are prone to commit violence and deliver a community message against violence, a law enforcement message about the consequences of further violence and an offer of help for those who want it.
Mount Washington Laboratory Agrees to Pay $1.2 Million to Resolve Allegations of False Claims for Urine Drug Testing ServicesRead the Press Release
LEXINGTON, Ky. – Bluewater Toxicology, LLC, a clinical laboratory in Mount Washington, Ky., has agreed to pay $1,252,403.40 to resolve civil allegations that it violated the False Claims Act, a federal law that prohibits submitting false or fraudulent claims to the federal government.
According to the settlement agreement, the Unites States alleged three issues relating to claims for urine drug testing services that Bluewater submitted to Medicare, Kentucky Medicaid, Indiana Medicaid, TRICARE, and CHAMPVA. First, the United States alleged that Bluewater submitted claims that mispresented the number of drug classes tested. Specifically, the United States contended that from January 2016, through September 2018, Bluewater submitted claims for definitive urine drug tests of 22 or more drug classes. The United States alleged that these claims were false because Bluewater tested for fewer than 22 drug classes. By billing as if they tested for a greater number of classes, Bluewater secured higher reimbursements to which it was not entitled.
Second, the United States alleged that from January 2016, through December 2017, Bluewater submitted certain claims without sufficient documentation to support the treating medical physician’s intent to order the test that was billed. By billing for these tests, Bluewater again secured reimbursements to which it was not entitled.
Finally, the United States alleged that Bluewater billed Medicare for specimen validity testing, a quality control process used to analyze a urine specimen to ensure that it has not been diluted or adulterated. Since January 2014, Medicare’s guidance has stated that specimen validity testing should not be separately billed to Medicare. The United States alleged that Bluewater nonetheless submitted claims to Medicare for specimen validity testing during the period October 2014 to May 2016.
“Whenever the valuable resources of government health care programs are dissipated, to those who are not entitled to them, that diminishes the ability of these critically important programs to meet the needs of their beneficiaries,” said Carlton S. Shier, IV, Acting United States Attorney for the Eastern District of Kentucky. “We must all remain committed to doing our part to protect the fiscal security of these vital resources.”
This matter arose from Bluewater’s self-disclosure of false claims for urine drug testing services. Because Bluewater self-disclosed the misconduct, it was able to resolve its liability for only 1.5 times the amount of monetary loss caused by its false claims. By statute, the False Claims Act imposes liability for three times the amount of loss suffered by the government.
Healthcare providers may voluntarily disclose self-discovered evidence of fraud to the U.S. Department of Health & Human Services Office of Inspector General. More information about how to self-disclose misconduct under the Provider Self-Disclosure Protocol is available at https://oig.hhs.gov/compliance/self-disclosure-info/protocol.asp.
The United States also encourages anyone with information about potential fraud, abuse, or mismanagement of Medicare or Medicaid funds to call the U.S. Department of Health and Human Services’ hotline at 800-HHS-TIPS (800-447-8477). False Claims Act allegations can also be brought under the qui tam provisions of the Act, which encourage whistleblowers to bring suit on behalf of the United States and potentially share in any financial recovery.
This investigation was conducted by the United States Attorney’s Office for the Eastern District of Kentucky, the Kentucky Attorney General’s Office of Medicaid Fraud and Abuse Control, the Indiana Attorney General’s Medicaid Fraud Control Unit, the U.S. Department of Health and Human Services Office of Inspector General, the Defense Health Agency’s Program Integrity Division, and the Department of Veterans Affairs’ Office of Inspector General. The United States was represented by Assistant United States Attorney Meghan Stubblebine.
The settlement resolves claims asserted by the United States; there has been no determination of liability.
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Man from Las Cruces sentenced to 12 years in federal prison for attempting to enticement a child into sexRead the Press Release
ALBUQUERQUE, N.M. – Ismael Valdez, 38, of Las Cruces, New Mexico, was sentenced on July 19 in federal court to 12 years in prison for attempted coercion and enticement.
Valdez pleaded guilty to these charges on Aug. 27, 2020. According to his plea agreement, between April 29, 2020, and May 29, 2020, Valdez met and messaged an undercover law enforcement officer posing as a 13-year-old girl on a social networking application. During the conversations, Valdez sent sexually explicit material to the “the child” and asked her to send sexually explicit material to him. Valdez arranged to meet with the child to have sex and traveled from his home in Las Cruces to a meeting location where law enforcement agents arrested him.
Upon completion of his prison sentence, Valdez will be subject to 10 years of supervised release.
The FBI investigated this case. Assistant U.S. Attorneys Matilda McCarthy Villalobos and Mark Saltman prosecuted the case.
Madison County Man Indicted for Federal Carjacking and Firearm OffensesRead the Press Release
Jackson, TN – Delvion "DJ" Beard, 20, of Jackson, Tennessee, has been indicted for the federal offenses of carjacking and brandishing a firearm in relation to a crime of violence. Acting U.S. Attorney Joseph C. Murphy Jr., announced the indictment today.
According to the indictment, on November 9, 2020, two victims were at a local gas station in Bolivar, Tennessee, when Beard, along with accomplices, Quadarius Greer, 19, and Bryson Townsley, 19, took their vehicle, an Audi A4 by force, violence and intimidation, with the intent to cause death or serious bodily harm.
On June 14, 2021, a grand jury seated in the Eastern Division of the Western District of Tennessee, returned a two-count indictment charging Beard, Greer and Townsley with carjacking and with brandishing a firearm during and in relation to the carjacking.
"I would like to thank everyone involved in the investigation of this case. Several Law enforcement agencies worked together to bring the defendants to justice. Thanks to the U.S. Attorney’s Office for taking the case," said City of Bolivar Police Chief Michael Jones.
If convicted of the carjacking offense, the defendant faces sentence up to 15 years imprisonment to be followed by three years supervised release. If convicted of using a firearm during a crime of violence offense, the defendant will face an additional mandatory minimum consecutive sentence of 7 years imprisonment; $250,000 fine and five years’ supervised release. There is no parole in the federal system.
This case was investigated by the Federal Bureau of Investigation (FBI), U.S. Marshals Service, Bolivar Police Department, Hardeman County Sheriff’s Office, Madison County Sheriff’s Office and the Jackson Police Department.
Trial Attorneys Sam Loeiro and Jared Hernandez with the Department of Justice’s Organized Crime and Gang Unit Section and Assistant U.S. Attorney Hillary L. Parham of the Western District of Tennessee are prosecuting this case on behalf of the government.
The charges and allegations contained in the indictment are merely accusations, and the defendants are considered innocent unless and until proven guilty.
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Los Angeles Man Arrested for $27 Million PPP Fraud SchemeRead the Press Release
A California man was arrested today in Los Angeles on criminal charges related to his alleged bank fraud, false statements in a loan application and money laundering arising from the submission of fraudulent applications for Paycheck Protection Program (PPP) funds.
According to court documents, Robert Benlevi, 52, of Encino, submitted 27 bank loan applications to four banks between April and June 2020 on behalf of eight companies solely owned by Benlevi. In the applications, Benlevi allegedly sought a total of $27 million in forgivable PPP loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. In his fraudulent applications, Benlevi allegedly represented that each of his companies had 100 employees and average monthly payroll of $400,000, even though he knew that the companies did not have any employees or payroll expenses. Benlevi also submitted fabricated IRS documents falsely stating that each of the companies had an annual payroll of $4,800,000.
The indictment alleges that based on Benlevi’s fraudulent loan applications, three of Benlevi’s companies — 1Stellar Health LLC, Bestways2 Health LLC, and Joyous-Health4U LLC — obtained $3 million in PPP funds. Although Benlevi falsely represented that the funds sought through the PPP loan applications would be used to pay payroll and certain other business expenses, he instead used them for personal expenses, including cash withdrawals, payments on his personal credit cards, and transfers to other personal and business accounts he controlled, the indictment alleges. In a single day, Benlevi withdrew from the Bestways2 Health account $248,000 of PPP funds in cashier’s checks, which were deposited into other accounts that Benlevi controlled.
Benlevi is charged with six counts of bank fraud, six counts of false statements in a loan application and four counts of money laundering. Each count of bank fraud and false statements in a loan application carry a maximum penalty of 30 years in federal prison, and the money laundering counts each carry a maximum penalty of 10 years. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant Attorney General Kenneth A. Polite Jr. of the Justice Department’s Criminal Division; Acting U.S. Attorney Tracy L. Wilkison for the Central District of California; Assistant Director in Charge Kristi Koons Johnson of the FBI’s Los Angeles Field Office; Special Agent in Charge Jeffrey D. Pittano of the Federal Deposit Insurance Corporation Office of Inspector General (FDIC OIG); and Special Agent in Charge Weston King of the SBA OIG Western Region made the announcement.
The FBI, SBA OIG and FDIC OIG are investigating the case.
Trial Attorneys Emily Culbertson and Helen Lee of the Criminal Division’s Fraud Section are prosecuting the case.
The Fraud Section leads the department’s prosecution of fraud schemes that exploit the PPP. In the months since the PPP began, Fraud Section attorneys have prosecuted more than 100 defendants in more than 70 criminal cases. The Fraud Section has also seized more than $65 million in cash proceeds derived from fraudulently obtained PPP funds, as well as numerous real estate properties and luxury items purchased with such proceeds. More information can be found at: https://www.justice.gov/criminal-fraud/ppp-fraud.
The CARES Act, which was enacted on March 29, 2020, was designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses, through the PPP. In April 2020, Congress authorized over $300 billion in additional PPP funding.
The PPP allows qualifying small businesses and other organizations to receive loans with a maturity of two years and an interest rate of 1%. PPP loan proceeds must be used by businesses on payroll costs, interest on mortgages, rent and utilities. The PPP allows the interest and principal to be forgiven if businesses spend the proceeds on these expenses within eight weeks of receipt and use at least 75 percent of the forgiven amount for payroll.
On May 17, the Attorney General established the COVID-19 Fraud Enforcement Task Force to marshal the resources of the Department of Justice in partnership with agencies across government to enhance efforts to combat and prevent pandemic-related fraud. The Task Force bolsters efforts to investigate and prosecute the most culpable domestic and international criminal actors and assists agencies tasked with administering relief programs to prevent fraud by, among other methods, augmenting and incorporating existing coordination mechanisms, identifying resources and techniques to uncover fraudulent actors and their schemes, and sharing and harnessing information and insights gained from prior enforcement efforts. For more information on the department’s response to the pandemic, please visit https://www.justice.gov/coronavirus.
Anyone with information about allegations of fraud related to COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Local 394 Union Leader Pleads Guilty to EmbezzlementRead 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 Donald Snyder, 50, of Akron, pleaded guilty before U.S. District Judge John L. Sinatra, Jr. to embezzlement by union officials. The charge carries a maximum penalty of five years in prison, and a fine of $250,000.
Assistant U.S. Attorney David J. Rudroff, who is handling the case, stated that between October 2013 and November 2019, the defendant served as president of the International Association of EMTs and Paramedics, Local 394, a labor organization affiliated with the National Association of Government Employees (NAGE) and Service Employees International Union (SEIU). Local 394 represents approximately 200 private sector employees of Twin City Ambulance in Amherst, NY. During his time as President of Local 394, Snyder embezzled approximately $94,649.85 in funds belonging to Local 394. The defendant did so by writing checks payable to himself, writing checks payable to cash, which he endorsed and withdrew, and making unauthorized bank withdrawals. None of the funds stolen by Snyder were used for a legitimate union purpose, all were used for the defendant’s personal benefit.
The plea is the result of an investigation by the U.S. Department of Labor, Office of Labor Management Standards, under the direction of the Boston-Buffalo District Director Jonathan Russo.
Sentencing is scheduled for November 17, 2021, at 4:00 p.m. before Judge Sinatra.
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Lincoln Man Convicted for Possession of Child PornographyRead the Press Release
Acting United States Attorney Jan Sharp announced that Jon T. Bogart, 60, of Lincoln, Nebraska, was sentenced today in Lincoln by United States District Court Judge John M. Gerrard for possession of child pornography. Bogart was sentenced to 12 years and 6 months in prison and 15 years of supervised release. There is no parole in the federal system. Bogart was additionally ordered to pay $1,000 which will contribute to funds established for victims of child exploitation crimes.
This investigation began with a series of eight cyber tip reports from the National Center for Missing & Exploited Children (NCMEC) indicating that an individual residing at Bogart’s residence was engaged in child pornography crimes in July of 2020. Based on the cyber tips, a search warrant was received for the search of the residence. During the execution of the search warrant, Bogart spoke with a Nebraska State Patrol investigator and directed the investigator to his room and his personal cellphone. He provided consent for his phone to be reviewed. When the investigator reviewed Bogart’s cell phone, he observed child pornography being stored in the Google Photos application and further observed child pornography related internet searches on the device. Bogart’s other devices were seized as well. A review of his devices revealed at least 14 videos of child pornography, as well as 80 images containing child pornography.
Bogart was previously convicted in 1995 in case #CR11-267 in the District Court for Jefferson County, Nebraska with Attempted First-Degree Sexual Assault of a Minor. Additionally, he was previously convicted in 2007 in case #CR07-32 in the District Court for Jefferson County, Nebraska with seven counts of Possession of Visual Depiction of Sexually Explicit Acts. Bogart was released from his prison sentence stemming from case #CR07-32 in October of 2019.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case was investigated by the Nebraska State Patrol.
Leader of the Blood Hound Brims Sentenced to 25 Years in Prison for Racketeering, Narcotics, and Firearms OffensesRead the Press Release
Audrey Strauss, the United States Attorney for the Southern District of New York, announced that BRANDON GREEN, a/k/a “Light,” was sentenced today to approximately 24.5 years in prison by U.S. District Judge Paul G. Gardephe in connection with his leadership of the Blood Hound Brims, a violent street and prison gang that operated in New York City and elsewhere, and his participation in narcotics trafficking and firearms offenses. GREEN was convicted on March 27, 2019, following an approximately five-week jury trial before Judge Gardephe, who also imposed today’s sentence.
U.S. Attorney Audrey Strauss said: “Brandon Green, one of the leaders of a ruthlessly violent gang, was responsible for extensive narcotics trafficking throughout the city and state of New York. Today’s lengthy sentence sends an important message to the Blood Hound Brims and other gang members that they will be arrested, prosecuted and face justice for their crimes.”
According to court documents, the evidence at trial, and statements made in court proceedings:
The Blood Hound Brims was a criminal enterprise that operated principally in the greater New York area, from at least 2005 up to and including 2016. The BHB was a faction of the Bloods street gang, which operates nationwide, and is under the New York Blood Brim Army (“NYBBA”). The BHB operated within and around various locations in New York, including New York City, Westchester County, Elmira, and in Pennsylvania, as well as within and outside federal and state penal systems.
The BHB used a hierarchical structure that was organized, in part, by New York City borough, and that was maintained, in part, through the payment of dues. The founder and leader of the gang was Latique Johnson, and other members and associates of the BHB referred to Johnson as the “Godfather.” The gang was divided into several “pedigrees,” each of which had its own leadership structure which was approved by Johnson. Leadership positions within the pedigrees included, among others, treasurers who collected dues from members of a particular pedigree, and individuals who performed security and disciplinary functions for the pedigree.
Members of the BHB had regular meetings, sometimes called “pow wows” or “9-11s,” at which members were required to pay dues. Some of the meetings were among members of a particular pedigree, and other meetings were for all members of the Enterprise. Word of the meetings was disseminated via text message, word-of-mouth, and flyers. The BHB’s business, including rivalries with other gangs, shootings, the arrest of gang members, guns, and drugs, was regularly discussed at these meetings. “Kitty dues” – money that paid for commissary funds, lawyers, guns, and drugs, and that served as tribute to Johnson – were collected at these meetings. The BHB maintained its own rules and constitution that new members were required to learn. Members of the BHB also used code words and secret phrases to communicate with each other both while in prison and on the street in order to avoid detection by law enforcement.
One of the BHB’s principal objectives was to sell cocaine base, commonly known as “crack cocaine,” powder cocaine, and heroin, which members and associates of the BHB sold throughout the greater New York area and in Pennsylvania.
Members and associates of the BHB engaged in multiple acts of violence against rival gangs. These acts of violence included assaults and attempted murders, which were committed to protect the Gang’s drug territory, to retaliate against members of rival gangs who had encroached on the territory controlled by the BHB, and to otherwise promote the standing and reputation of the Gang vis-à-vis rival gangs. These acts of violence also included assaults and attempted murders against members and associates of the BHB itself, as part of internal power struggles within the Gang.
GREEN, 38, of the Bronx, New York, was one of BHB’s primary suppliers of cocaine and heroin, providing other Gang members with redistribution quantities of narcotics for resale in New York City and Elmira, New York. GREEN also maintained a supply of firearms, which he sometimes made available to other members of the Gang. At the time of GREEN’s arrest in May 2017, U.S. Marshals recovered six loaded firearms from the residence where he was living.
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Latique Johnson, a/k/a “La Brim,” 41, of the Bronx, New York, the Gang’s founder, was convicted following a jury trial of of racketeering conspiracy, assault in aid of racketeering, attempted murder in aid of racketeering, narcotics conspiracy, and firearms. Johnson was sentenced in 2019 to 30 years in prison.
Donnell Murray, 41, of the Bronx, New York, a BHB leader was convicted following a jury trial of racketeering conspiracy, assault in aid of racketeering, narcotics conspiracy, and a firearms offense. Murray was sentenced in 2019 to 20 years in prison.
David Cherry, 40, of the Bronx, New York, a BHB leader, was convicted following a guilty plea to a firearms offense. Cherry was sentenced in June to 10 years in prison.
Ms. Strauss praised the outstanding investigative work of the Federal Bureau of Investigation, the New York City Police Department, and the Special Agents of the United States Attorney’s Office for the Southern District of New York.
The prosecution is being handled by the Violent and Organized Crime Unit of the U.S. Attorney’s Office for the Southern District of New York. Assistant U.S. Attorneys Jessica Feinstein, Allison Nichols, and Andrew Chan are in charge of the prosecution.