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Friday 30 April 2021
North Andover Woman Sentenced for Embezzling Employer’s Outgoing Vendor PaymentsRead the Press Release
BOSTON – A North Andover woman was sentenced Wednesday, April 28, 2021 in federal court in Boston in connection with embezzling over $157,000 in checks issued by her employer to company vendors.
Sharon M. Lewis, 59, was sentenced by U.S. District Court Judge George A. O’Toole Jr. to nine months in prison and three years of supervised release. Lewis was also ordered to forfeit $157,213 and to pay restitution in the same amount. In December 2020, Lewis pleaded guilty to one count of wire fraud affecting a financial institution.
In or about August 2013, Lewis began working for a Lawrence-based company as an accounts payable clerk. Among Lewis’ responsibilities was preparing company checks to pay outstanding vendor invoices. From about September 2017 to December 2019, Lewis used her position to divert dozens of signed vendor checks to herself for deposit into her personal bank account. On multiple occasions, to conceal her scheme, Lewis led vendors to believe that their missing payments had been lost in the mail. Over the course of the scheme, Lewis deposited at least 48 checks payable to company vendors, with a total value of more than $157,000. Lewis withdrew approximately one-third of that amount in cash and used the rest to pay personal debts and living expenses.
Acting United States Attorney Nathaniel R. Mendell and Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division made the announcement today. Assistant U.S. Attorney James R. Drabick of Mendell’s Securities, Financial & Cyber Fraud Unit prosecuted the case.
Niskayuna Man Sentenced for Stealing GE’s Trade SecretsRead the Press Release
ALBANY, NEW YORK – Yang Sui, age 43, of Niskayuna, New York, was sentenced today to 1 year of probation, and to pay a $5,000 fine, for stealing trade secrets.
The announcement was made by Elizabeth C. Coombe, Attorney for the United States Acting Under Authority Conferred by 28 U.S.C. § 515, and Thomas F. Relford, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI).
As part of his earlier guilty plea, Sui admitted that between about January 1, 2015 and December 21, 2017, he stole multiple electronic files that contained the General Electric Company’s trade secrets surrounding the research, development, design and manufacture of its silicon carbide metal-oxide semiconductor field-effect transistors (MOSFETs).
MOSFETs are small electronic semiconductors/switches that regulate the flow of electricity through devices; they are used in a variety of products.
Sui further admitted that in about 2017, he was developing a business plan to start his own company whose purpose was to manufacture and sell MOSFETs.
There was no evidence that Sui transferred the MOSFET trade secrets to anyone else.
This case was investigated by the FBI, and prosecuted by Assistant U.S. Attorney Rick Belliss and Trial Attorney Matthew Chang of the Department of Justice’s Counterintelligence and Export Control Section, part of the National Security Division.
Newington Man on Supervised Release Sentenced to 8 Years in Prison for Drug and Gun OffensesRead the Press Release
Leonard C Boyle, Acting United States Attorney for the District of Connecticut, announced that LIONEL GARDNER, also known as “Bleek,” 36, of Newington, was sentenced today by U.S. District Judge Jeffrey A. Meyer in New Haven to 96 months of imprisonment, followed by five years of supervised release, for narcotics distribution and gun possession offenses, and for violating the conditions of his supervised release from a prior federal conviction.
According to court documents and statements made in court, in October 2015, Gardner was released from federal prison after serving a 60-month sentence for distributing crack cocaine in Hartford. On November 21, 2018, while Gardner was on federal supervised release, he was arrested on state charges by Newington Police after he sold heroin/fentanyl to a customer, and a search of his residence revealed a large quantity of fentanyl and cocaine, a stolen Glock 10mm pistol, a Smith & Wesson .357 revolver, loaded magazines, and more than $55,000 in cash.
In August 2019, investigators made controlled purchases of fentanyl and crack from Gardner while he was released on bond in his state case. Gardner was arrested on a federal criminal complaint on August 14, 2019. On that date, a search of Gardner’s Newington residence revealed approximately 105 grams of powder cocaine, 3.4 grams of crack cocaine, 667 bags of fentanyl, 8.7 grams of loose fentanyl, and $4,000 in cash.
Gardner has been detained since his federal arrest. On December 17, 2020, he pleaded guilty to one count of possession with intent to distribute 40 grams or more of fentanyl, and one count of possession of a firearm by a felon.
Gardner forfeited the seized firearms and cash.
This investigation was conducted by the FBI’s Northern Connecticut Gang Task Force and the Newington Police Department. The task force includes members of the Hartford Police Department, East Hartford Police Department, New Britain Police Department, West Hartford Police Department, Connecticut State Police and Connecticut Department of Correction. The case was prosecuted by Assistant U.S. Attorney Brian P. Leaming.
This prosecution has been brought through Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make neighborhoods safer for everyone.
New Orleans Resident Pleads Guilty to Conspiring to Traffick Heroin with His Uncle and Six OthersRead the Press Release
NEW ORLEANS, LA – U.S. Attorney Duane A. Evans announced that KEVIN COFFIL age 25, a resident of New Orleans, Louisiana, pled guilty on April 29, 2021 to conspiring to distribute one kilogram or more of heroin. COFFIL is facing a mandatory minimum sentence of 10 years’ imprisonment, a maximum sentence of life imprisonment, a possible fine of up to $10,000,000, at least five years of supervised release upon his release from prison and a $100 mandatory special assessment fee.
According to court records, COFFIL admitted to conspiring with codefendant Arthur Johnson, his uncle, and six others to distribute heroin throughout the New Orleans area. The evidence against COFFIL includes numerous intercepted communications, including jail calls, physical surveillance, and witness statements.
U.S. District Judge Susie Morgan will sentence COFFIL on August 5, 2021. COFFIL, Arthur Johnson, and the other codefendants were charged in 2018 with conspiring to distribute heroin in the New Orleans area.
U.S. Attorney Evans praised the work of the Federal Bureau of Investigation’s New Orleans Gang Task Force in investigating this matter. Assistant United States Attorney David Howard Sinkman is in charge of the prosecution.
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New Durham Man Sentenced to 69 Months for Drug Trafficking and Firearm ChargesRead the Press Release
CONCORD - Cowin Hillsgrove, 45, of New Durham, was sentenced to 69 months in federal prison for possession of methamphetamine with intent to distribute and possession of a firearm in furtherance of drug trafficking, Acting United States Attorney John J. Farley announced today.
According to court documents and statements made in court, on February 8, 2019, a Bow police officer conducted a traffic stop and arrested an individual on an active warrant for sale of heroin. The arrestee informed the officer she bought heroin and methamphetamine from Hillsgrove who was staying in a Concord hotel. She stated he sold large quantities of drugs from the hotel room and she was going to make a purchase that night.
Later that day, Concord police officers went to Hillsgrove’s hotel room. He stated he had been staying there for several weeks because his home had burned down. Hillsgrove admitted to using methamphetamine but denied selling drugs. Officers obtained a search warrant for Hillsgrove’s hotel room. The search yielded approximately 32 grams of methamphetamine, two loaded handguns and receipts for a handgun and 9mm magazines, $267 in currency, and various other items consistent with drug trafficking.
“Armed drug traffickers present a serious threat to public safety,” said Acting U.S. Attorney Farley. “While methamphetamine dealers endanger the community by selling a dangerous drug, the risk is enhanced when the drug dealers are armed. To protect the citizens of the Granite State from harm, we will not hesitate to seek substantial federal prison sentences for drug traffickers who use or possess guns.”
“DEA stands committed to keeping highly addictive drugs like methamphetamine off the streets of New Hampshire,” said DEA Special Agent in Charge Brian D. Boyle. “Today’s sentence not only holds Mr. Hillsgrove accountable for his crimes but serves as a warning to those traffickers who are contributing to the drug crisis.”
This matter was investigated by the Drug Enforcement Administration, the Concord Police Department, the Bow Police Department and the New Durham Police Department. The case was prosecuted by Assistant U.S. Attorney John S. Davis.
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NDTX Round up: April 23 – 29Read the Press Release
SENTENCING – KIRA LANE
On April 28, Kira Lane, 54, was sentenced to 5 years probation and ordered to pay $233,681.25 in restitution for access device fraud. Lane operated a catering business where he processed credit card transactions. During 2015, he used stolen credit card numbers for approximately 64 credit card transactions totaling $233,681.25. The U.S. Secret Service conducted the investigation. Assistant U.S. Attorney Jenna Rudoff prosecuted the case.
SENTENCING – LUIS PENA-ALEMAN
On April 26, Luis Pena-Aleman, 25, was sentenced to 135 months in federal prison for possession with the intent to distribute methamphetamine. In February 2019, a confidential source met a co-conspirator at an agreed location in Dallas. The co-conspirator arrived at the agreed location in a truck registered to Pena-Aleman to deliver the methamphetamine. Agents conducted a search of a storage facility located in Mesquite, Texas where they found a large quantity of methamphetamine and Pena-Aleman’s truck. The Drug Enforcement Administration conducted the investigation. Assistant U.S. Attorney Suzanna Etessam prosecuted the case.
GUILTY PLEA – OSCAR MARIO FLORES DAZA
On April 28, Oscar Mario Florez Daza, 32, pleaded guilty to conspiracy to launder money. In April 2020, Florez Daza picked up $14,800 in drug proceeds from a codefendant to launder. In May, Florez Daza picked up $40,000 in drug proceeds from a location in Oklahoma to transport them to Texas. Flores Daza faces up to 20 years in federal prison for his crimes. The Drug Enforcement Administration conducted the investigation. Assistant U.S. Attorney P.J. Meitl is prosecuting the case.
Mobile Man Sentenced for Role in Methamphetamine ConspiracyRead the Press Release
United States Attorney Sean P. Costello of the Southern District of Alabama announced that Alvie Mark Waltman, 48, of Mobile, was sentenced today for his participation in a conspiracy to possess with intent to distribute methamphetamine. In January of 2021, Waltman pled guilty to the conspiracy charge.
According to documents filed in connection with his guilty plea, Waltman was identified during an investigation that began with the arrest of one of the members of the conspiracy on I-10 by the Saraland Police Department. Police found methamphetamine and a gun in his vehicle. Through undercover work and an analysis of that subject’s phone, Waltman was identified as a member of the distribution network. Waltman provided $4,730 in cash to the cooperating co-conspirator to purchase additional methamphetamine for Waltman to distribute in Mobile. Waltman was arrested when he attempted to take possession of nine ounces of methamphetamine. Waltman was advised of his rights and he agreed to make a statement to investigators, admitting his involvement in the conspiracy.
United States District Court Judge Terry F. Moorer imposed a sentence of 108 months imprisonment, and ordered that Waltman serve a five-year term of supervised release when he is released from custody. Waltman was also ordered to pay a mandatory special assessment of $100. No fine was imposed.
The case was investigated by the Saraland Police Department, the Mobile County Sheriff’s Office and Homeland Security Investigations. It was prosecuted in the United States Attorney’s Office by Assistant United States Attorney Gloria Bedwell.
Miami-Based CareCloud Health, Inc. Agrees to Pay $3.8 Million to Resolve Allegations that it Paid Illegal KickbacksRead the Press Release
MIAMI – CareCloud Health, Inc. f/k/a CareCloud Corporation (CareCloud), a Miami-based developer of electronic health records (EHR) software products and related services, has agreed to pay $3,806,966.70 to resolve allegations that it paid unlawful kickbacks to generate sales of its EHR products.
The United States alleged that CareCloud violated the False Claims Act and the Anti-Kickback Statute through its marketing referral program called the “Champions Program,” In particular, it is alleged that between January 1, 2012 and March 31, 2017, CareCloud offered and provided its existing clients cash equivalent credits, cash bonuses and percentage success payments to recommend CareCloud’s EHR products to prospective clients. Existing clients who participated in the Champions Program (“participants”) executed written agreements prohibiting them from providing negative information about CareCloud’s EHR products to prospective CareCloud clients. Prospective CareCloud clients were not told about this referral-kickback arrangement or about the contract that prohibited participants from sharing negative company information with them.
The United States alleged that CareCloud’s payments to participants violated the federal Anti-Kickback Statute. In addition, the United States alleged that CareCloud violated the False Claims Act because the kickback payments rendered false the claims submitted by CareCloud for federal incentive payments under the Medicare and Medicaid Electronic Health Records Incentive Programs (also known as Meaningful Use Programs) and the Merit-Based Incentive Payment System (also known as MIPS).
CareCloud was acquired by MTBC, Inc. (MTBC), a public company, in January 2020. CareCloud has discontinued the prior version of the marketing referral program that is the basis for this settlement.
Juan Antonio Gonzalez, Acting United States Attorney for the Southern District of Florida, and Omar Pérez Aybar, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), announced the settlement.
“Product functionality, reliability, and safety should drive a medical software company’s success, not illegal kickbacks paid to promote its products,” said Acting United States Attorney Gonzalez. “There is simply no place for kickbacks in our country’s healthcare system. Companies who ignore this will be held accountable.”
“Medical software executives who unlawfully promote the capabilities of their electronic health record technology, and pay others to do the same, diminish their credibility and waste taxpayer money,” said Special Agent in Charge Pérez Aybar. “My Office will continue to investigate such actions to protect the funding for federal health care programs.”
The settlement resolves allegations in a lawsuit filed by Ada De La Vega in federal court in Miami, Florida. The lawsuit was filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private individuals to sue on behalf of the government for false claims and to share in any recovery. The Act allows the government to intervene and take over the action, as it did in this case. The whistleblower share to be awarded in connection with the settlement is $803,269,97.
HHS-OIG investigated the matter. Assistant United States Attorney Matthew J. Feeley handled the litigation.
Related court documents and information may be found on the website of the District Court of the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov under case number 17-cv-23762.
Note: A copy of the settlement agreement is available
here .Macomb County Car Salesman Charged with Wire FraudRead the Press Release
A criminal complaint was unsealed today charging a Macomb Township man in a wire fraud scheme involving the trafficking in Fiat Chrysler Automobiles Employee Purchase Control Numbers (EPCNs), announced Acting United States Attorney Saima Mohsin.
Mohsin was joined in the announcement by Special Agent in Charge Vance Callender, Homeland Security Investigations (HSI), Michigan and Ohio
Charged is Apollon Nimo, 34. Nimo made his initial appearance today before U.S. Magistrate Judge Anthony P. Patti and was released on bond. A preliminary exam was set for May 21, 2021.
The criminal complaint alleges that Nimo, a salesman at Parkway Chrysler Dodge Jeep Ram in Clinton Township, improperly trafficked in, used, and sold FCA EPCNs to provide discounts to non-qualified car buyers from 2014 through the present. The EPCNs were bought and sold through private Facebook Groups. According to the complaint, it is alleged that some, if not most, of the sales conducted by Nimo included fraudulent use of EPCNs resulting in a loss to FCA of approximately $8.7 million dollars. The complaint further alleges that Nimo profited both by selling the illegally obtained EPCNs to buyers and through bonuses FCA provided to him based on the volume of his sales. Nimo had the highest number of EPCN sales nationwide for the time period of May 2018 to August 2018 and January 2019 to March 2019.
“Automobile sales play a major role in our state’s economy,” said Acting US Attorney Mohsin. “Corruption of the sort alleged in today’s complaint imposes costs on automotive manufacturers that are ultimately passed to consumers. The charges announced today are serious and reflect my office’s commitment to ensuring the integrity of this market.”
“This morning, HSI special agents arrested a top selling Fiat Chrysler Automobiles (FCA) salesman for defrauding the company of approximately $8.7 million by exploiting FCA’s employee purchase program,” said Vance Callender, HSI Special Agent in Charge for Michigan and Ohio. “HSI will continue to fight financial crime and support the integrity of American manufacturing by leveraging its unique law enforcement capabilities.”
A criminal complaint is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
This case was investigated by the special agents of Homeland Security Investigations and the Clinton Township Police Department along with assistance from Fiat Chrysler Automobiles corporate investigators. Assistant U.S. Attorney Mark Chasteen is prosecuting the case.
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Las Vegas Woman Convicted of Sending Letters Threatening to Injure Her Mother's Former Supervisor and LawyersRead the Press Release
LAS VEGAS, Nev. – A federal jury convicted a Las Vegas woman yesterday for mailing letters threatening to injure her mother’s former supervisor and members of the law firm defending the mother’s former employer, announced Acting U.S. Attorney Christopher Chiou for the District of Nevada.
According to court documents and evidence presented at the five-day trial, between August 11, 2018 and October 1, 2019, Latonia Smith, 27, sent anonymous threatening letters to her mother’s former supervisor; and attorneys and staff professionals engaged by her former employer to defend against a lawsuit Smith filed. In three of the letters, Smith wrote: “your throat will be slit you will be recorded as the blood spills from your neck and just as you gasp to take your final undeserving breath three bullets will be placed right through your skull.” In another letter, she threatened that the recipients had been “added to the hit list” and it would be the “end of lives.”
Smith was convicted of five counts of mailing threatening communications through the U.S. Mail. She faces a maximum statutory penalty of 25 years in prison, a term of supervised release, and a monetary fine. U.S. District Judge Richard F. Boulware presided over the trial. The Court has not yet scheduled a sentencing hearing.
This case was the product of an investigation by the U.S. Postal Inspection Service, with assistance from the Las Vegas Metropolitan Police Department and the Reno Police Department. The case is being prosecuted by Assistant U.S. Attorneys Steven Myhre and Daniel Clarkson.
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La Crosse Man Sentenced to 12 Years for Drug & Gun CrimesRead the Press Release
MADISON, WIS. – Timothy M. O’Shea, Acting United States Attorney for the Western District of Wisconsin, announced that Kong Vang, 31, La Crosse, Wisconsin, was sentenced yesterday by U.S. District Judge William M. Conley to 144 months in federal prison for conspiracy to distribute 50 grams or more of methamphetamine and possessing a firearm in furtherance of a drug trafficking crime. This prison term will be followed by 4 years of supervised release. Vang pleaded guilty to these charges on February 5, 2021.
On July 15, 2020, law enforcement officers were investigating an anonymous complaint that Vang and his girlfriend, Pader Yang, were selling large quantities of methamphetamine out of their residence in La Crosse, Wisconsin. Officers conducted surveillance on the residence and observed people arriving, going in and out of the garage, and then immediately returning to their cars or bicycles.
Based on these observations, and the fact that Vang was on state supervision for prior convictions involving methamphetamine trafficking, possessing a firearm as a convicted felon, and 2nd degree recklessly endangering safety, law enforcement officers searched Vang’s residence. During the search of a bedroom shared by Vang and Yang, officers located a safe containing four loaded handguns, eight bags of methamphetamine, and just under $12,000. Officers found a fifth loaded firearm elsewhere in the bedroom, and additional drugs, paraphernalia, and ammunition throughout the residence, the garage, and in a vehicle recently driven by Yang. In total, officers found approximately 254 grams of “ice” methamphetamine, and over 250 grams of marijuana.
In an interview with law enforcement, Vang admitted to using and selling methamphetamine. He admitted to being a convicted felon and knew that he was not allowed to possess firearms. Law enforcement officers later searched Vang and Yang’s cell phones and located many conversations relating to sale of methamphetamine and marijuana. Based on the evidence in the case, officers believed Vang was a pound to kilo level methamphetamine dealer.
Vang’s state supervision was revoked and Judge Conley ordered this federal sentence to run concurrently with the state prison sentences Vang is now serving following revocation. In imposing the sentence, Judge Conley referenced Vang’s prior criminal record which included convictions of violence, drug trafficking, and gun possession.
Pader Yang pleaded guilty to conspiracy to distribute 50 grams or more of methamphetamine on February 18, 2021. She is scheduled for sentencing before Judge Conley on May 11, 2021.
The charges against Vang and Yang were the result of an investigation conducted by the La Crosse Police Department, Federal Bureau of Investigation, and Bureau of Alcohol, Tobacco, Firearms and Explosives. The prosecution of the case is being handled by Assistant U.S. Attorney Steven P. Anderson.
Justice Department Announces the Opening of Nominations for the Fifth Annual Attorney General’s Award for Distinguished Service in Community PolicingRead the Press Release
U.S. Attorney General Merrick B. Garland today announced the Department of Justice is now accepting nominations for the Fifth Annual Attorney General’s Award for Distinguished Service in Community Policing. These awards represent part of the Department of Justice’s on-going commitment to support the nation’s law enforcement officers who put their lives on the line every day to keep our communities safe.
“Effective community policing builds trust between law enforcement officers and those they serve, and that trust helps to improve public safety,” said Attorney General Garland. “These awards honor the exceptional dedication and hard work of law enforcement officers who have gone above and beyond in the performance of their duties, and departments that have excelled in their community policing efforts. Policing is a difficult job, for which extraordinary efforts often go unnoticed, and the Department of Justice is proud to publicly recognize these exemplars of community policing.”
The Attorney General’s Award recognizes individual state, local and tribal sworn, rank- and-file police officers and deputies for exceptional efforts in community policing. The awarded officers, deputies and troopers will have demonstrated active engagement with the community in one of three areas: criminal investigations, field operations or innovations in policing. Within each category, an award will be given to law enforcement agencies serving small, medium, and large jurisdictions. Those agency sizes are defined as:
- Small: agencies serving populations of fewer than 50,000
- Medium: agencies serving populations of 50,000 to 250,000
- Large: agencies serving populations of more than 250,000
By acknowledging and rewarding these efforts, the department strives to promote and sustain its national commitment to community policing and to advance proactive policing practices that are fair and effective. With the Attorney General’s Award for Distinguished Service in Community Policing, the Office of the Attorney General recognizes that the nation’s law enforcement agencies, officers, deputies, and troopers continue to work tirelessly to keep our communities safe places to live and work.
The deadline for nominations is May 28, 2021, at 8 p.m. EDT. More information and the application for nominees can be found at: https://www.justice.gov/ag/policing-award.
Jury Convicts Palm Bay Man of Transporting and Possessing Child Sex Abuse MaterialRead the Press Release
Orlando, Florida – A federal jury has found Xzavier Scholtens (20, Palm Bay) guilty of one count of transporting and one count of possessing child sex abuse material. Scholtens faces a maximum penalty of 20 years in federal prison and a lifetime term of supervised release for each offense. His sentencing hearing is scheduled for July 20, 2021.
Scholtens had been indicted on May 27, 2020.
According to testimony and evidence presented at trial, this case arose from an online undercover operation conducted by Homeland Security Investigations agents in McAllen, Texas. The operation targeted individuals who were using a particular online social media platform to trade or distribute child sex abuse images.
On November 19, 2019, Scholtens sent an online message to one of the undercover agents and offered to “trade.” After a brief discussion, Scholtens sent a hyperlink that led to a cloud storage folder containing 12 videos. These videos depicted the sexual abuse of children, ranging from infants to pubescent teenagers.
This case was investigated by Homeland Security Investigations in McAllen, Texas and Rockledge, Florida. It is being prosecuted by Assistant United States Attorney Emily C. L. Chang.
This is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Jury Convicts Former Virginia Beach Investment Advisor and Williamsburg Attorney of $25 Million Nationwide Investment FraudRead the Press Release
NORFOLK, Va. – A federal jury convicted two individuals today for their roles in a nationwide investment fraud scheme that resulted in over $25 million in losses to more than 300 victims, most of whom were elderly.
“As proven during a five-week trial, these defendants and their co-conspirators defrauded hundreds of unsuspecting investors out of over $25 million, draining their retirement accounts and leaving a trail of financial and emotional devastation for the victims,” said Raj Parekh, Acting U.S. Attorney for the Eastern District of Virginia. “The jury’s verdicts bring us one step closer to securing justice for the victims of these damaging, manipulative, and life-altering schemes. Our Office is deeply appreciative to the trial team and our law enforcement partners for their tireless work in unraveling this complex fraud and ensuring these defendants are held accountable."
According to court records and evidence presented at trial, Daryl Bank, 51, of Port St. Lucie, Florida, ran an investment fraud scheme from approximately January 2012 through July 2017, based in the Tidewater area and Port St. Lucie, and operating across the country. Bank and his co-conspirators—including attorney Billy Seabolt, 56, Raeann Gibson, 49, of Florida, and Roger Hudspeth 51, of Suffolk—deceived hundreds of unsuspecting investors, most of whom were at or near retirement age, by convincing them to invest in companies owned and controlled by Bank. At Bank’s direction, co-conspirators stole significant portions of investment contributions to fund their criminal enterprise and Bank’s lavish lifestyle.
In 2010, Bank, then a registered securities broker, was barred from the securities industry by the Financial Industry Regulatory Authority (FINRA). Undeterred, Bank created a private equity company called Dominion Private Client Group (Dominion) and continued to sell unregistered securities on his own and through insurance salesmen across the country. Billy Seabolt served as Dominion’s legal counsel and was involved in the development of many of the fraudulent investments and corporations.
The conspirators made material misrepresentations and omissions to sell illiquid, highly speculative investment vehicles. Based on these fraudulent representations, unsuspecting investors cashed out of 401(k) and other retirement accounts to invest in Bank’s investment vehicles, without knowing that Bank immediately transferred 20%–70% of the investors’ funds to companies that he controlled in the form of purported “fees.” As a result of this investment fraud scheme, the victims suffered losses in excess of $25 million.
Bank was convicted of conspiracy, mail and wire fraud, selling unregistered securities, securities fraud, and money laundering. He faces a maximum penalty of over 300 years in prison when sentenced on September 20. Seabolt was convicted of conspiracy and mail fraud, and he faces a maximum penalty of 75 years in prison when sentenced on September 15. 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.
Gibson pleaded guilty to conspiracy and was sentenced to 10 years in prison in February 2020. Hudspeth pleaded guilty to investment advisor fraud and money laundering and was sentenced to over 12 years in prison in May 2018.
Raj Parekh, Acting U.S. Attorney for the Eastern District of Virginia; Brian Dugan, Special Agent in Charge of the FBI’s Norfolk Field Office; Darrell J. Waldon, Acting Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation (IRS-CI); and Peter R. Rendina, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service, made the announcement after U.S. District Judge Raymond A. Jackson accepted the verdicts. The U.S. Attorney’s Office extends its appreciation to the Virginia State Corporation Commission’s Division of Securities.
Assistant U.S. Attorneys Melissa E. O’Boyle, Elizabeth M. Yusi, and Andrew Bosse prosecuted the case.
Combatting elder abuse and financial fraud targeted at seniors is a key priority of the Department of Justice. Elder abuse is an intentional or negligent act by any person that causes harm or a serious risk of harm to an older adult. It is a term used to describe five subtypes of elder abuse: physical abuse, financial fraud, scams and exploitation, caregiver neglect and abandonment, psychological abuse, and sexual abuse. Elder abuse is a serious crime against some of our nation’s most vulnerable citizens, affecting at least 10 percent of older Americans every year. Together with our federal, state, local, and tribal partners, the Department of Justice is steadfastly committed to combatting all forms of elder abuse and financial exploitation through enforcement actions, training and resources, research, victim services, and public awareness. This holistic and robust response demonstrates the Department’s unwavering dedication to fighting for justice for older Americans.
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. 2:17-cr-126.
Jacksonville Man Sentenced to 60 Years in Federal Prison for Producing Photos of Himself as He Sexually Assaulted an 11-Year-Old ChildRead the Press Release
Jacksonville, Florida – Chief United States District Judge Timothy J. Corrigan has sentenced Columbus Donavan Jeffrey (44, Jacksonville) to 60 years in federal prison for photographing his sexual assaults of a child and distributing those pictures to others using the internet. Jeffrey was also ordered to serve a lifetime term of supervised release, register as a sex offender, and pay $24,000 in restitution to child victims.
Jeffrey had pleaded guilty on December 10, 2020.
According to court documents, the National Center for Missing and Exploited Children (NCMEC) received information from a company that hosts an online social messaging application (app). Specifically, on May 3, 2019, a user named “hideme1977,” subsequently identified as Jeffrey, used the app to upload several photos to the internet. These photos, taken by Jeffrey, depicted him sexually abusing an 11-year-old child. NCMEC referred this matter to the Jacksonville Sheriff’s Office (JSO) for investigation.
On October 3, 2019, JSO detectives and other officers executed a search warrant at Jeffrey’s residence, where he admitted he had used the “hideme1977” user name on the app. JSO detectives were also able to identify and locate the child shown in the photos, who stated that Jeffrey had sexually abused the child on at least three separate occasions in 2019.
JSO conducted a forensic examination of Jeffrey’s cellphone which revealed: images of the same child being sexually abused by Jeffrey on two other dates in 2019; online messages showing Jeffrey used the internet to share the sexual assault photos with others; and that Jeffrey maintained a collection of 635 images and 57 videos depicting the sexual abuse of other minors, including several depicting the rape of infants and toddlers.
“Predators who exploit innocent children are among the most evil criminals in society, and the acts committed by this defendant are among the most egregious that we have investigated.” said Rachel L. Rojas, Special Agent in Charge of the FBI Jacksonville Division. “This case proves that the FBI Jacksonville Division is fully committed to holding child predators accountable for their actions, and we remain dedicated to ensuring that criminals like him cannot bring harm to the most vulnerable members of our communities ever again. We are thankful for the partnership of the Jacksonville Sheriff’s Office in the relentless effort to seek justice for these victims. Be assured our work will not end here.”
This case was investigated by the Jacksonville Sheriff’s Office and the Federal Bureau of Investigation, with assistance from the National Center for Missing and Exploited Children. It was prosecuted by Assistant United States Attorneys D. Rodney Brown and Kelly S. Karase.
This is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Jackson Man Sentenced under Project EJECT to 30 Months in Prison for Illegally Selling a GunRead the Press Release
Jackson, Miss. – Michael Mays a/k/a Michael Mayes, 35, of Jackson, was sentenced today by U.S. District Tom S. Lee to 30 months in prison and a $1500 fine for knowingly selling a firearm to a felon, announced Acting U.S. Attorney Darren J. LaMarca and Special Agent in Charge Michelle Sutphin of the Federal Bureau of Investigation in Mississippi.
According to court documents, on or about July 19, 2018, Mays knowingly sold a firearm in Jackson to a convicted felon.
The Federal Bureau of Investigation investigated the case.
Assistant U.S. Attorney Lynn Murray prosecuted the case.
This case is part of Project EJECT, an initiative by the U.S. Attorney’s Office for the Southern District of Mississippi under the U.S. Department of Justice’s Project Safe Neighborhoods (PSN). EJECT is a holistic, multi-disciplinary approach to fighting and reducing violent crime through prosecution, prevention, re-entry and awareness. EJECT stands for "Empower Justice Expel Crime Together." PSN is bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Former Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
Informational: Federal Court arraignmentsRead the Press Release
The U.S. Attorney’s Office announced that the following persons were arraigned or appeared this week before U.S. Magistrate judges on indictments handed down by the Grand Jury or on criminal complaints. The charging documents are merely accusations and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law:
Appearing in Billings before U.S. Magistrate Judge Timothy J. Cavan and pleading not guilty on April 27 was:
Dennis Wayne Householder, Jr., 38, of Billings, on charges of conspiracy to possess with intent to distribute methamphetamine and possession with intent to distribute meth. If convicted of the most serious crime, Householder faces a mandatory minimum 10 years to life in prison, a $10 million fine and at least five years of supervised release. Householder was detained pending further proceedings. The FBI Transnational Organized Crime Task Force and the Eastern Montana High Intensity Drug Trafficking Area Task Force investigated the case. PACER case reference. 21-22.
Appearing on April 29 and pleading not guilty was:
Stacey Lee Milch, 39, of Billings, on charges of conspiracy to commit wire fraud, wire fraud and aggravated identity theft. If convicted of the most serious crime, Milch faces a maximum 20 years in prison, a $250,000 fine and three years of supervised release on the wire fraud charges and a mandatory two years in prison consecutive to any other sentence, a $250,000 fine and one year of supervised release on the aggravated identity theft charge. Milch was detained pending further proceedings. The U.S. Secret Service and the Billings Police Department investigated the case. PACER case reference. 21-23.
Appearing on April 30 and pleading not guilty was:
Josue Mikael Nunez, 21, of Carrollton, Georgia, on charges of conspiracy to possess with intent to distribute meth and possession with intent to distribute meth. If convicted of the most serious crime, Nunez faces a mandatory minimum 10 years to life in prison, a $10 million fine and at least five years of supervised release. Nunez was detained pending further proceedings. The FBI and the Eastern Montana High Intensity Drug Trafficking Area Task Force investigated the case. PACER case reference. 21-24.
Appearing in Missoula before U.S. Magistrate Judge Kathleen L. DeSoto and pleading not guilty on April 28 was:
Robert Raymond Fasuga, 39, of Helena, on charges of conspiracy to distribute and to possess with intent to distribute, possession with intent to distribute meth and possession of a stolen firearm. If convicted of the most serious crime, Fasuga faces a mandatory minimum 10 years to life in prison, a $10 million fine and at least five years of supervised release. Fasuga was detained pending further proceedings. The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Lewis and Clark County Sheriff’s Office investigated the case. PACER case reference. 21-03.
Appearing in Great Falls before U.S. Magistrate Judge John T. Johnston and pleading not guilty on April 30 was:
Harold Goodson Hill, 36, of Helena, on charges of conspiracy to possess with intent to distribute meth, possession with intent to distribute meth, and interstate transportation of stolen property. If convicted of the most serious crime, Hill faces a mandatory minimum 10 years to life in prison, a $10 million fine and at least five years of supervised release. Hill was detained pending further proceedings. The FBI, U.S. Postal Service, Russell Country Drug Task Force, Gallatin County Sheriff’s Office, Broadwater County Sheriff’s Office, Missouri Highway Patrol and Sioux Falls Police Department investigated the case. PACER case reference. 21-19.
Appearing on April 29 and pleading not guilty was:
Tammy Lynn Lapie, 55, of Great Falls, on charges of conspiracy to possess with intent to distribute controlled substances and possession with intent to distribute controlled substances. If convicted of the most serious crime, Lapie faces a mandatory minimum 10 years to life in prison, a $10 million fine and at least five years of supervised release. Lapie was released pending further proceedings. The Drug Enforcement Administration and the Great Falls Police Department investigated the case. PACER case reference. 21-27.
The progress of cases may be monitored through the U.S. District Court Calendar and the PACER system. To establish a PACER account, which provides electronic access to review documents filed in a case, please visit http://www.pacer.gov/register.html. To access the District Court’s calendar, please visit https://ecf.mtd.uscourts.gov/cgi-bin/PublicCalendar.pl.
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Indy Man Sentenced to 27 Years for Drug Dealing and Money LaunderingRead the Press Release
INDIANAPOLIS - An Indianapolis man was sentenced to 27 years for dealing methamphetamine and heroin, and an additional 20 years for money laundering. The sentences will run concurrently.
According to court documents, in late November 2018, George West, 36, of Indianapolis was traveling on I-70 in Hancock County. West had committed several traffic violations and a deputy with the Hancock County Sheriff’s Office initiated a traffic stop. West provided the deputy false identification and became combative with the deputy. West ran from the deputy and ended up back at the car he was driving. West attempted to drive from the scene and in doing so struck the deputy with the car. The deputies were able to stop West, but he continued to struggle with the deputies and at one point tried to unholster the deputy’s gun.
A K9 officer was at the scene and his K9 partner alerted that Wests vehicle may contain an illegal substance. During a subsequent search of the vehicle, deputies found approximately three pounds of methamphetamine. West admitted to possessing the drugs and said he had more at his apartment. During the execution of a search warrant of West’s apartment, officers found four loaded firearms, approximately 500 grams of heroin, over 300 grams of methamphetamine, and other items related to illegal drug trafficking.
The investigators also determined that between May 2017 and November 2018, West purchased money orders every month with his illegal drug proceeds to pay rent at the apartment he used for his drug dealing. To conceal the laundering of his drug profits, West utilized another person to sign the lease to the apartment and placed their name on the money orders he used to pay the rent. That amount totaled over $29,000.
“Heroin and methamphetamine are dangerous drugs that continue to ravage our communities,” said Acting U.S. Attorney John E. Childress. “Putting those who infect our streets with these terrible drugs behind bars has been and will continue to be a top priority of this office.”
This investigation was a collaborative effort between several law enforcement agencies. The IRS-Criminal Investigation, Homeland Security Investigation, DEA, Indianapolis Metropolitan Police Department, and the Pro-Active Criminal Enforcement Team (PACE) from Hancock and Henry Counties investigated the case.
Assistant U.S. Attorney Michelle Brady, who prosecuted the case for the government said West must also serve 5 years supervised release after his imprisonment.
Independence Man Pleads Guilty to Illegal Firearms, Drug TraffickingRead the Press Release
KANSAS CITY, Mo. – An Independence, Missouri, man has pleaded guilty in federal court to multiple charges of illegally possessing firearms, including stolen firearms, and drug trafficking.
Brandon L. Hill, 33, pleaded guilty before U.S. District Judge Greg Kays on Thursday, April 29, to three counts of being a felon in possession of a firearm, two counts of possessing a stolen firearm, four counts of possessing a controlled substance, three counts of possessing a firearm in furtherance of a drug-trafficking crime, and one count of possessing methamphetamine with the intent to distribute.
According to the plea agreement, Hill was arrested by Kansas City, Mo., police officers on three separate occasions. He was in possession of firearms and illegal drugs on each of those occasions, and attempted to flee from officers on two occasions.
On March 31, 2019, officers saw Hill driving a 2001 Buick Regal that had been taken in an armed robbery carjacking a few days earlier. As Hill drove out of a gas station parking lot at 2601 Swope Parkway, officers attempted to close the distance between themselves and Hill. Hill began driving erratically and at a high rate of speed. He left the road at 49th and Walrond Avenue and ran from the vehicle. He was taken into custody a short time later. Officers found a Taurus 9mm semi-automatic handgun (reported as stolen) tucked in his pants, a Smith & Wesson 9mm semi-automatic handgun in his pants pocket, and a Sig Sauer .380-caliber semi-automatic handgun wrapped in fabric and tucked under his groin. Officers also found a baggie of methamphetamine and a baggie of cocaine in Hill’s pockets.
Hill had earlier been arrested on March 26, 2019. Officers stopped a Ford Ranger truck that was being driven by another person, with Hill a passenger, because it’s license plates belonged to a different vehicle. The driver of the vehicle had eight active warrants, and both the driver and Hill were directed to get out of the truck. Officers brought Hill to the rear of the truck to conduct a frisk, but he resisted multiple orders to put his hands behind his back and bladed his body away from the officer. Hill then turned and ran across the street. An officer pursued him and tackled him to the ground. Hill was then placed under arrest, and officers found methamphetamine and cocaine in his pockets. Officers also found a Glock 9mm semi-automatic pistol with a 33-round, extended magazine in the area where Hill ran from the officers. Officers found a Zastava 7.62x39mm semi-automatic rifle and an AK-47 magazine in the truck. Both the rifle and the Glock contained Hill’s DNA.
Hill’s earliest arrest in this case occurred on Jan. 19, 2019, when police officers conducted a car check on a 2005 GMC Yukon, which had an expired temporary license plate, near 5215 Olive Street. Hill was a passenger in the vehicle. When the driver reached inside her purse for her identification and handed it to a police officer, a baggy that contained methamphetamine fell on the ground and the driver said, “Uh-oh.” She was placed under arrest. She had another baggie of methamphetamine inside her purse. Officers also removed Hill from the passenger seat and detained him in handcuffs. Inside the vehicle, officers found a Smith & Wesson 9mm semi-automatic pistol (which had been reported stolen) stuffed between the passenger seat, where Hill was sitting, and the center console. Officers also found a baggie of cocaine and a glass vial that smelled of PCP in Hill’s pockets.
Under federal law, it is illegal for anyone who has been convicted of a felony to be in possession of any firearm or ammunition. Hill has prior felony convictions for drug trafficking, unlawful use of a weapon, burglary, and assault.
Under the terms of the plea agreement, Hill is subject to a sentence of at least 20 years in federal prison without parole, up to a sentence of 25 years in federal prison without parole. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorneys Brad K. Kavanaugh and Sean T. Foley and Special Assistant U.S. Attorney Sarah J. Rasalam. It was investigated by the Kansas City, Mo., Police Department.
Illinois Man Pleads Guilty to Two Bank RobberiesRead the Press Release
BOSTON – An Illinois man pleaded guilty in federal court in Boston on Wednesday, April 28, 2021 in connection with a Massachusetts bank robbery and an Illinois bank robbery.
Eugene Davis, 54, of Chicago, Ill., pleaded guilty to two counts of bank robbery. U.S. District Court Judge Leo T. Sorokin scheduled sentencing for Sept. 9, 2021.
In July 2019, Davis was indicted on the Massachusetts bank robbery. In March 2021, Davis was charged in the Northern District of Illinois with an unrelated bank robbery, and the case was recently transferred to this District for plea and sentencing purposes.
According to the charging documents, Davis robbed a branch of the East Boston Savings Bank in South Boston on June 3, 2019. Davis walked into the bank pulling a suitcase and handed a handwritten demand note to the teller. The note said that there was a bomb in the bag, that everyone was going to die and to please put all the money into Davis’s hand. The teller took $6,055 cash out of the teller drawer and gave it to Davis who placed it in his shirt and walked out of the bank. Davis was apprehended later that day and ultimately confessed to committing the bank robbery and to writing the note used in the bank robbery.
On May 22, 2019, Davis robbed a Chase Bank in Chicago, Ill. Davis entered the bank pulling a wheeled suitcase and handed the teller a demand note. The note stated that Davis had a bomb, demanded money and threatened that no dye packs be included or they would all die. The teller provided approximately $3,460 in cash to Davis who then departed the bank with the money.
The charging statute provides for a sentence of up to 20 years in prison, up to three years of supervised release and a fine of $250,000. Sentences are imposed by a federal district court judge based on the United States Sentencing Guidelines and other statutory factors.
Acting United States Attorney Nathaniel R. Mendell; John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigations, Boston Field Division; Emmerson Buie, Jr., Special Agent in Charge of the Federal Bureau of Investigations, Chicago Field Division; Colonel Christopher Mason, Superintendent of the Massachusetts State Police; and Boston Police Acting Commissioner Gregory Long made the announcement. Assistant U.S. Attorney Suzanne Sullivan Jacobus of Mendell’s Major Crimes Unit is prosecuting the case.
Honduran National Sentenced for Illegal Re-entryRead the Press Release
BOSTON – A Honduran national was sentenced yesterday in federal court in Worcester for illegally reentering the United States.
Milton Javier Cardona-Guevara, 34, was sentenced by U.S. District Court Judge Timothy S. Hillman to three months in prison. Upon completion of his sentence, Cardona-Guevara will be placed into removal proceedings and deported to Honduras.
In December 2020, Cardona-Guevara pleaded guilty to one count of illegal re-entry into the United States after deportation.
On Aug. 13, 2006, Cardona-Guevara illegally entered the United States and was convicted of improper entry by an alien in August 2006. He was subsequently deported in September 2006. In 2008 and 2011, Cardona-Guevara was apprehended after illegally entering the United States and again deported. On Oct. 2, 2018, Cardona-Guevara was arrested in Worcester County for assault with a dangerous weapon. Cardona-Guevara admitted to immigration authorities that he had been deported three times previously. In January 2019, he was removed from the U.S. On Oct. 13, 2020, Cardona-Guevara was arrested in Worcester on an outstanding warrant for criminal charges and had been custody on state criminal charges until he was charged in this case.
Acting United States Attorney Nathaniel R. Mendell and Todd Lyons, Field Office Director, Enforcement and Removal Operations, U.S. Immigration and Customs Enforcement, Boston made the announcement. Assistant U.S. Attorney John T. Mulcahy of Mendell’s Worcester Branch Office prosecuted the case.
Honduran Man Pleads Guilty to Unlawful ReentryRead the Press Release
Gulfport, Miss. – A Honduran national pleaded guilty today to the crime of unlawful reentry by an alien who was previously deported after conviction of a felony, announced Acting U.S. Attorney Darren J. LaMarca and Michael J. Harrison, Acting Chief Patrol Agent of the Border Patrol’s New Orleans Sector.
According to court documents, Marcio Bonilla-Romero, 38, was arrested after a traffic stop by the U.S. Border Patrol on Interstate 10 in Jackson County on August 27, 2020. Bonilla-Romero provided the agent with a Honduran passport and told the agent that he did not have a driver's license. The agent returned to his vehicle to run record checks and learned that Bonilla-Romero had an extensive criminal history, as well as an active Felony Warrant issued in Harris County, Texas, with full extradition. The agent placed Bonilla-Romero under arrest for the Texas felony warrant.
Bonilla-Romero was extradited to Harris County, Texas. However, investigation continued in the Southern District of Mississippi. It was discovered that Bonilla-Romero may have been removed in 2002 under the name Jose Morales-Gonzalez (listed as a citizen of Mexico). It also was learned that Bonilla-Romero was in fact the same person as Morales-Gonzalez and had been removed in 2002 and again in 2015. Officials confirmed that Bonilla-Romero and Morales-Gonzalez were in fact the same person. Officials also confirmed that Bonilla-Romero, under the alias of Jose Morales-Gonzalez, had been removed from the United States to Mexico on May 15, 2002, and again on July 17, 2002.
Bonilla-Romero pleaded guilty to unlawful reentry by an alien deported or removed after conviction of a felony. He is scheduled to be sentenced on Friday, July 30, 2021 at 9:30 a.m. He faces a maximum penalty of ten years in prison, followed by three years of supervised release, and up to a $250,000 fine. A federal district judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors. Bonilla-Romero also faces Department of Homeland Security proceedings regarding removal from the U.S. following completion of any prison sentence.
The U.S. Border Patrol and the Jackson County Sheriff’s Office worked the case, which is being prosecuted by Assistant U.S. Attorney Stan Harris.
Harrisburg Man Indicted for Possession of A Firearm as A Convicted FelonRead the Press Release
HARRISBURG – The United States Attorney’s Office for the Middle District of Pennsylvania announced that on April 28, 2021, James Patterson, age 40, of Harrisburg, Pennsylvania, was indicted by a federal grand jury with possession of a firearm as a convicted felon.
According to Acting U.S. Attorney Bruce D. Brandler, the indictment alleges that on October 8, 2020, in Dauphin County, Pennsylvania, Patterson was in possession of a Charter Arms .38 caliber handgun and three rounds of ammunition after previously having been convicted of a felony offense.
The matter was investigated by the Harrisburg Police Department’s Street Crimes Unit and the Community Policing Unit, along with the Bureau of Alcohol, Tobacco, Firearms, and Explosives. Assistant U.S. Attorney Paul J. Miovas, Jr. is prosecuting the case.
This case is part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local and tribal enforcement and the local community to develop effective, locally-based strategies to reduce crime.
Indictments are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty for this offense is 10 years of imprisonment, a term of 3 years of supervised release following imprisonment, and a $250,000 fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Gypsum Man Pleads Guilty to Filing a False Tax ReturnRead the Press Release
GRAND JUNCTION — The U.S. Attorney’s Office for the District of Colorado announces that Trenton Switzer, age 40, of Gypsum, CO pleaded guilty for willfully making and subscribing a false tax return.
According to the filed information and the stipulated facts in the plea agreement, Switzer created a nonprofit corporation in Colorado called the Church of Divine Sovereignty. During the 24 hours that this corporation legally existed, Switzer obtained an Employer Identification Number and opened a bank account in its name. Later, Switzer deposited $250,000 in the account and informed his return preparer that these deposits were charitable contributions. After determining that Switzer’s “Church of Divine Sovereignty” did not qualify as a charitable organization, the preparer advised Switzer that the payments were not deductible. Despite these warnings, Switzer nevertheless signed and personally filed his 2015 U.S. Federal Tax Return, falsely claiming a $250,000 charitable contribution deduction.
Fraud and false statements in a tax return carry a sentence of up to three years in prison, one year of supervised release, and a fine of up to $250,000. As part of the plea agreement, Switzer has agreed to pay restitution of $241,964.71, plus penalties and interest to the IRS.
Switzer pleaded guilty before U.S. Magistrate Judge Gordon P. Gallagher on April 26, 2021, in Grand Junction. He is scheduled to be sentenced on July 7, 2021, before U.S. District Court Judge Christine M. Arguello.
This matter was investigated by IRS-CI and is being prosecuted by Assistant United States Attorney Jeremy Chaffin.
Case No. 21-cr-00093-CMA-GPG
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Gretna Resident Pleads Guilty to Possessing 66 Kilograms of Cocaine and $3.9 Million in Drug Proceeds Seized at His Stash House and HomeRead the Press Release
NEW ORLEANS, LA – U.S. Attorney Duane A. Evans announced today that DORIAN WILLIAMS, age 47, of Gretna, Louisiana, pled guilty to possessing with intent to distribute five kilograms or more of cocaine and engaging in money laundering of profits from his drug trafficking. Agents seized approximately 66 kilograms of cocaine and about $3.9 million in drug proceeds hidden inside his Gretna stash house and home.
As part of his guilty plea, WILLIAMS agreed to forfeit nearly $5 million in drug proceeds, real estate properties in New Orleans purchased with drug proceeds, and two cars. WILLIAMS faces up to life imprisonment, a fine of $10,000,000, at least five years of supervised release following any term of imprisonment and a $200 special assessment fee. United States District Judge Jane Triche Milazzo will sentence WILLIAMS on August 11, 2021.
According to court documents, Drug Enforcement Administration agents from the New Orleans Field Division identified WILLIAMS in early 2020 as a supplier of kilogram quantities of cocaine to other drug dealers in the New Orleans metropolitan area. Agents also identified multiple addresses associated with WILLIAMS in the Jefferson Parish, Louisiana area.
Agents conducted surveillance on two of these properties – WILLIAMS’s stash house (“Stash House”) and home, both in Gretna. On November 19, 2020, agents conducted an investigatory stop on WILLIAMS’s vehicle. Following the advisement of his Miranda Rights, which he waived, WILLIAMS provided verbal and written consent to search his Stash House and home. Agents discovered approximately twenty-one (21) kilograms of cocaine in hidden drawer compartments inside a wooden TV cabinet in the Stash House, and approximately forty-five (45) kilograms of cocaine and $3.9 million in drug proceeds in WILLIAMS’s home. The Government and WILLIAMS have agreed that WILLIAMS was responsible for possessing with intent to distribute between 50 kilograms and 150 kilograms of cocaine.
In addition, according to court documents, from on or about February 20, 2019 through on or about February 17, 2020, WILLIAMS used approximately $667,500 in proceeds from his cocaine trafficking to purchase seven real estate properties in New Orleans. Doing business as GO GET IT ENTERPRISES, LLC, a Louisiana-based company, WILLIAMS laundered the proceeds of his drug dealing operations in violation of 18 U.S.C. § 1957(a) by purchasing and then developing these seven real estate properties with profits generated from his cocaine sales. WILLIAMS sold six of these seven properties for a profit.
This prosecution is part of an extensive investigation by the Organized Crime Drug Enforcement Task Force (OCDETF). OCDETF is a joint federal, state, and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional level drug trafficking organizations and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.
U.S. Attorney Evans praised the work of the Drug Enforcement Administration, Jefferson Parish Sheriff’s Office, Hammond Police Department, New Orleans Police Department, and Slidell Police Department in investigating this matter. Assistant United States Attorney David Howard Sinkman is in charge of the prosecution.
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Fort Myers Woman Pleads Guilty to Financial Aid Fraud and Wire FraudRead the Press Release
Fort Myers, Florida – Elaine M. Levidow (60, Fort Myers) has pleaded guilty to five counts of wire fraud and one count of fraud involving Department of Education Financial Aid. She faces a maximum penalty of 20 years in federal prison for each count of wire fraud and up to 5 years’ imprisonment for the financial aid fraud. A sentencing date has not yet been set.
According to the plea agreement, beginning in approximately July 2017 and continuing through April 2019, Levidow devised and perpetrated a scheme to defraud the United States Department of Education of more than $90,000 in Title IV Federal Student Assistance (FSA), the primary federal loan and grant funds available to students attending college and career schools. The United States Department of Education requires that the Title IV funds be applied only to specific allowable charges, which include: tuition, mandatory fees, and room and board contracted by the participating institutions of higher education.
As the owner and Chief Executive Officer of The Training Domain, Inc., located in Fort Myers, Levidow used a website to market her company as offering business software application courses to make individuals more employable. As a part of the scheme, Levidow knowingly enrolled students that did not have a high school diploma or GED certificate, making them ineligible to receive FSA funds, and she assisted them in applying for FSA funds. In one instance, Levidow knowingly enrolled a student who was a felon serving a life term in a Florida State prison, assisting him in obtaining FSA funds even though he was ineligible.
In other instances, Levidow applied for FSA loans on behalf of students without telling them, then caused those FSA funds to be wired to Training Domain even though it was not entitled to them.
Levidow admitted to agents that she knew many if not all the students did not have a high school diploma or a GED, but she enrolled them anyway. Further, she admitted that she staged a fictitious class, during an accreditation visit, with students who did not attend class and whom she paid to be there to make it appear she was actually holding classes.
Further, although Levidow’s business, Training Domain, was represented to be an educational institution, she did not use FSA funds to pay for students’ tuitions since her business did not actually hold required classes. Instead, Levidow used the FSA funds to pay for her own personal expenses.
This case was investigated by The United States Department of Education, Office of Inspector General. It is being prosecuted by Assistant United States Attorney Yolande G. Viacava.
Former federal training officer admits assault on federal employeeRead the Press Release
BRUNSWICK, GA: A former federal training officer has admitted assaulting a fellow Customs and Border Protection employee at the Federal Law Enforcement Training Centers in Glynco, Ga.
Roberto Baptiste, 37, of Brunswick, pled guilty in U.S. District Court to an Information charging him with Assault on a Federal Officer or Employee, said David H. Estes, Acting U.S. Attorney for the Southern District of Georgia. The charge carries a statutory penalty of up to eight years in prison, followed by three years of supervised release and financial penalties of up to $250,000. There is no parole in the federal system.
“All workers have a right to do their jobs without fear of harassment or assault,” said Acting U.S. Attorney Estes. “This prosecution sends a clear message that such violations will not be tolerated.”
As described in the plea agreement accepted by U.S. District Court Judge Lisa Godbey Wood, Baptiste admitted that on Nov. 5, 2018, at the Federal Law Enforcement Training Centers near Brunswick, he “forcibly assaulted, intimidated, and interfered with” a fellow Customs and Border Protection (CBP) employee.
A sentencing date has not yet been set.
“DHS employees are held to the highest standards of professional conduct,” said Inspector General Joseph V. Cuffari, “There is no place among the dedicated professionals of DHS for individuals who cannot respect the law or their colleagues.”
The case was Investigated by the Department of Homeland Security Office of Inspector General, and prosecuted for the United States by Southern District of Georgia Assistant U.S. Attorneys Jennifer J. Kirkland and Joshua S. Bearden.
Former Spa Owner Pleads Guilty for Using Cosmetic Fillers Not Approved for Distribution in the United StatesRead the Press Release
A woman who operated a Tulsa spa pleaded guilty today in federal court for using medical devices, also known as cosmetic fillers, on patients that were not approved by the U.S. Food and Drug Administration (FDA), announced Acting U.S. Attorney Clint Johnson.
Elisa Kaye Sanders, 61, of Tulsa, pleaded guilty to misdemeanor fraud relating to misbranded devices.
Sanders admitted that on March 10, 2017, she administered the medical devices Juvederm® Ultra 4 and Juvederm® Ultra with Lidocaine to a patient. These specific devices are not approved by the FDA for distribution in the United States and are considered adulterated under the Food, Drug, and Cosmetic Act. Sanders failed to tell the patient she was using unapproved fillers. According to court documents, Sanders purchased the fillers from unauthorized sources and was previously advised by the FDA that purchasing these prescription devices from unauthorized sources was illegal.
Sanders was a majority owner and operator of L’Chaim Medical Spa, previously known as Enhance Skin and Body Medical Spa. The business is no longer in operation.
The Food and Drug Administration, Office of Criminal Investigations conducted the investigation. Assistant U.S. Attorneys Shannon Cozzoni and Scott Proctor are prosecuting the case.
Former Odessa Firefighter Admits Accessing and Possessing Child PornographyRead the Press Release
Jeremy Lee Barrera, a 36-year-old former firefighter with the Odessa Fire Department (OFD), admitted in federal court today to possessing child pornography and using his cell phone on the OFD network to access an online chat room where several videos were posted which depicted child pornography.
Appearing before U.S. Magistrate Judge Ronald Griffin in Midland, Barrera pleaded guilty to one count of possession of child pornography. According to court documents, HSI agents conducting an online child sex exploitation investigation identified two local IP addresses used by an account registered to a “Ray Jones” to enter an encrypted online group chat whose members were viewing child pornography. One IP address was registered to OFD Station #2; the other was registered to Barrera’s residence. Based on that information, agents executed a search warrant at Barrera’s residence on January 25, 2021. During that search, agents seized the defendant’s cell phone. A subsequent forensics examination of the cell phone revealed the presence of multiple videos and images depicting minors engaged in sexually explicit activity. The forensics examination of the cell phone also discovered approval remarks by the defendant about child pornography posted in the chat room as well as requests for additional links to child pornography which he communicated in multiple chats using the moniker “Ray Jones”.
“Individuals, such as Barrera, who send or receive child pornography revictimize children each time these illegal images are distributed online,” said Homeland Security Investigations (HSI) Special Agent in Charge Erik P. Breitzke, El Paso Division. “Child exploitation is one of the most serious crimes HSI investigates, because of the lasting physical and psychological damage inflicted on innocent and vulnerable victims, and we will continue to pursue these perpetrators and ensure serious consequences for their heinous crimes.”
Barrera is currently in federal custody. He faces up to 20 years in federal prison. A sentencing date has yet to be scheduled.
U.S. Attorney Ashley C. Hoff and HSI Special Agent in Charge Breitzke made the announcement.
HSI, together with the Odessa Police Department, investigated this case. Assistant U.S. Attorney Shane Chriesman is prosecuting this case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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Former Jackson Police Officer Sentenced for Obstruction of a Federal InvestigationRead the Press Release
Jackson, Miss. – Mark Anthony Coleman, 58, a former Jackson Police Officer, was sentenced today by United States District Judge Tom S. Lee to 30 months in prison, followed by 3 years of supervised release, for destroying evidence of his involvement with a 16-year old female, announced Acting United States Attorney Darren J. LaMarca, Michelle Sutphin, Special Agent in Charge of the Federal Bureau of Investigation in Mississippi, and Mississippi Attorney General Lynn Fitch.
Coleman was charged in a federal criminal indictment on July 14, 2020 and he pled guilty before Judge Lee on January 21, 2021.
The Federal Bureau of Investigation, the Mississippi Attorney General’s Office and the Jackson Police Department investigated the case.
Assistant U.S. Attorney Glenda R. Haynes prosecuted the case.
Former Financial Advisor Sentenced to 78 Months in Prison for Role in $2 Million Ponzi Scheme Targeting Elderly InvestorsRead the Press Release
TRENTON, N.J. – A Somerset County, New Jersey man, was sentenced today to 78 months in prison for engaging in a $2 million Ponzi scheme targeting elderly investors and for subscribing to a false tax return, Acting U.S. Attorney Rachael A. Honig announced.
Daniel Rivera, 51, of Hillsborough, New Jersey, a former financial advisor, previously pleaded guilty before U.S. District Judge Anne E. Thompson to a superseding information charging him with one count of wire fraud and one count of subscribing to a false tax return. Judge Thompson imposed the sentence today in Trenton federal court.
According to documents filed in this case and statements made in court:
From 2008 through 2017, Rivera solicited primarily elderly investors to invest their money in a company called Robbins Lane Properties Inc. Rivera represented to investors that Robbins Lane was a company staffed by experienced real estate professionals that invested in real estate ventures. Rivera told investors that by investing in Robbins Lane, senior investors would share in the company’s investment portfolio by lending it money to invest in real estate. Rivera further promised investors that they would receive a guaranteed monthly income, and that the company’s rate of return was based on secure real estate investments in the company’s portfolio. In reality, Robbins Lane had no employees, no real estate portfolio, and the monies used to pay investors as a purported return on their investments was from funds he received from other investors. Rivera also used funds sourced from investors to pay his personal and unrelated business expenses, including paying his child’s college tuition and sorority fees.
During the course of the fraudulent scheme, on March 5, 2014, Rivera filed with the IRS a federal income tax return that underreported his taxable income by $33,276.
In addition to the prison term, Judge Thompson sentenced Rivera to three years of supervised release and ordered him to pay restitution of $1.47 million to his victims and $284,863 to the IRS.
Acting U.S. Attorney Honig credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark, and special agents of the IRS-Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez in Newark, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Perry Farhat of the Government Fraud Unit in Newark.
Former CEO of Connecticut Non-Profit Admits Embezzling $683KRead the Press Release
Leonard C Boyle, Acting United States Attorney for the District of Connecticut, and David Sundberg, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, announced that MICHAEL MEAKEM, 59, of Norwich, waived his right to be indicted and pleaded guilty today in New Haven federal court to one count of wire fraud stemming from an embezzlement scheme.
According to court documents and statements made in court, Meakem was the president and chief executive officer of the Center for Financial Training (“CFT”), a Farmington-based non-profit organization that provided continuing education to employees in the financial services industry. Between approximately 2013 and 2020, Meakem embezzled at least $683,202 from CFT’s credit card accounts and bank accounts and used the funds on personal expenses, including alimony payments, meals, cruises, other vacations, and gambling at Connecticut’s casinos.
Wire fraud carries a maximum term of imprisonment of 20 years. Meakem is scheduled to be sentenced by U.S. District Judge Michael P. Shea on August 3, 2021.
Meakem was ordered released by Magistrate Judge Sarah A.L. Merriam on a $100,000 bond pending sentencing.
This investigation has been conducted by the Federal Bureau of Investigation, with assistance from the Norwich Police Department. The case is being prosecuted by Assistant U.S. Attorney Jonathan N. Francis, and the government was represented at today's hearing by Law Student Intern Clio Koller.
Former CEO of Live Well Financial Convicted in Connection with $200 Million Bond Fraud SchemeRead the Press Release
Audrey Strauss, the United States Attorney for the Southern District of New York, announced that MICHAEL HILD, the founder and former chief executive officer of Live Well Financial, Inc. (“Live Well”), was convicted today of securities fraud, wire fraud, and bank fraud charges in connection with a scheme to fraudulently inflate the value of a portfolio of bonds owned by Live Well in order to induce various securities dealers and at least one financial institution into loaning more money to Live Well – through repurchase (“repo”) agreements and collateralized loans – than they otherwise would have had they known the actual value of Live Well’s bond portfolio. The scheme allowed Live Well to grow its bond portfolio exponentially, from approximately 20 bonds with a stated value of approximately $50 million in 2014 to approximately 50 bonds with a stated value of over $500 million by the end of 2016. In May 2019, in conjunction with an effort to wind down the company, Live Well wrote down the value of its portfolio by over $200 million.
Manhattan U.S. Attorney Audrey Strauss said: “As a unanimous jury found, Michael Hild obtained millions of dollars in secured loans for Live Well Financial by grossly inflating the value of bonds used as collateral. Hild deceived a third-party pricing service by providing it with inflated marks, resulting in the pricing service publishing valuations for the bonds far in excess of market value. Lenders were hoodwinked into lending far more than they otherwise would have. The house of cards came crashing down with the unwinding of Live Well and the revelation to lenders that the bond portfolio had been overvalued by $200 million. Now, Michael Hild awaits sentencing for his crimes.”
According to the evidence presented during the trial:
Live Well’s Bond Portfolio and Repurchase Agreements
Live Well was a Richmond, Virginia-based company that originated, serviced, and securitized government-guaranteed reverse mortgages known as Home Equity Conversion Mortgages (“HECMs”). In or about 2014, Live Well acquired a portfolio of approximately 15 bonds, each entitling the holder to receive a portion of the interest payments, but not the principal payments, from a particular pool of reverse mortgages (“HECM IO bonds.”). Live Well purchased the HECM IO bond portfolio for approximately $50 million. At the same time that Live Well purchased the HECM IO bond portfolio, HILD established within Live Well a New York City-based trading desk to manage and grow Live Well’s bond portfolio.
Live Well financed the acquisition and growth of its bond portfolio through a series of loans in which Live Well used its bond portfolio as collateral. The majority of Live Well’s lenders were securities dealers whose lending arrangements with Live Well were structured as bond repurchase agreements, also known as “repo agreements.” A repo agreement is a short-term loan in which both parties agree to the sale and future repurchase of an asset within a specified contract period. The seller sells the asset to the lender with a promise to buy it back at a specific date and at a price that includes an interest payment. Functionally, a repo agreement is a collateralized loan in which title of the collateral is transferred to the lender. When the loan is repaid by the borrower, the collateral is returned to the borrower through a repurchase. Additionally, at least one of Live Well’s lenders was an FDIC-insured bank, and its lending arrangement with Live Well was structured as a secured loan, with certain bonds held as collateral by a third-party custodian.
The Scheme to Mismark the Bond Portfolio
Live Well’s financing agreements with all but one of the lenders required that any bond that Live Well sought to borrow against be priced by a third-party pricing source in order to determine the market value of the bond as of the measurement date. The lenders then used the value of the bond, coupled with the application of a haircut of generally 10% to 20%, to determine the amount of money to lend Live Well.
The lenders generally relied on a particular widely utilized subscription service (the “Pricing Service”) to price various securities. In or about September 2014, HILD and his co-conspirators embarked on a scheme to cause the Pricing Service to publish valuations for the bonds that far exceeded actual market prices. By doing so, the conspirators induced the lenders to extend credit to Live Well far in excess of the prices for which the bonds could be sold in the market. The inflated prices were based on a set of market assumptions that the conspirators called “Scenario 14.”
HILD was aware that if the lenders had known that the Pricing Service was publishing bond prices that did not reflect fair value, meaning the price at which a lender could sell the bond in the market if necessary to recoup its capital, they would have refused to use those prices in determining how much money to loan to Live Well. To prevent the Pricing Service and the lenders from learning that the prices did not reflect market value, HILD directed his co-conspirators at Live Well to take steps to conceal their provision of inflated marks to the Pricing Service. Ultimately, due to the asset overvaluation and the purchase of additional bonds using the capital generated by the scheme, Live Well grew the purported value of its bond portfolio to over $500 million by December 2016.
In addition to using the liquidity generated by the scheme to expand Live Well’s bond portfolio, in or about September 2016, HILD used $18 million generated from the repo lenders to buy out the preferred stockholders in Live Well. The elimination of the preferred stockholders gave HILD control of the company and allowed him to substantially increase his personal compensation. Accordingly, HILD’s compensation jumped from approximately $1.4 million in 2015, to approximately $5 million in 2016, approximately $9.7 million in 2017, and over $8 million in 2018.
In or about late 2018, the chief financial officer of Live Well resigned after HILD refused to reduce the compensation he was receiving from the company. In or about May 2019, the company’s interim chief financial officer informed HILD that he would not sign the company’s interim financial statements because he believed that the company’s carrying value for the HECM IO bond portfolio was significantly overstated. In or about May 2019, Live Well announced that it would cease operations and unwind. After the announcement of Live Well’s closing, Live Well’s interim chief financial officer provided a balance sheet to Live Well’s lenders showing that Live Well had reduced the value of its bond portfolio by over $200 million.
* * *
HILD, 46, of Richmond, Virginia, was convicted of five counts: one count of conspiracy to commit securities fraud; one count of conspiracy to commit wire and bank fraud; one count of securities fraud; one count of wire fraud; and one count of bank fraud. Count One carries a maximum sentence of five years in prison, Counts Two, Four, and Five each carry a maximum sentence of 30 years in prison, and Count Three carries a maximum sentence of 20 years in prison. The charges also contain a maximum fine of $5 million, or twice the gross gain or loss from the offense.
The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge.
HILD is scheduled to be sentenced at 10:00 a.m. on August 20, 2021, by U.S. District Judge Ronnie Abrams, who presided over the trial.
Ms. Strauss praised the investigative work of the FBI and also thanked the Securities and Exchange Commission.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Jordan Estes and Scott Hartman are in charge of the prosecution.
Florida woman admits to bankruptcy fraudRead the Press Release
CLARKSBURG, WEST VIRGINIA – Heather Lynn Pratt, of Fort Myers, Florida, has admitted to bankruptcy fraud, Acting U.S. Attorney Randolph J. Bernard announced.
Pratt, 32, pleaded guilty to one count of “Fraudulent Concealment of Bankruptcy Assets.” At the time of the offense, Pratt was employed by Emerald Grande, LLC and had access to the finances of the Florida-based company. Emerald Grande was operating two La Quinta Inn & Suites in West Virginia, one in Elkview and the other in Summersville, as well as a commercial property in Charleston known as the Kanawha Landing Property. Emerald Grande was a debtor in a bankruptcy case filed and pending in Clarksburg United States Bankruptcy Court.
Pratt admitted to concealing more than $145,000 she embezzled from the operating account of the LaQuinta Inn & Suites in Summersville from the bankruptcy trustee, when in fact, that money belonged to the debtor, Emerald Grande, LLC.
As a part of the plea agreement, Pratt will be required to pay restitution in the amount of $145,386.93 to the U.S. Bankruptcy Trustee.
Pratt is facing up to five years of incarceration and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Jarod J. Douglas is prosecuting the case on behalf of the government. The FBI investigated.
U.S. Magistrate Judge Michael John Aloi presided.
Felon Admits Possessing Handgun in GrotonRead the Press Release
Leonard C Boyle, Acting United States Attorney for the District of Connecticut, announced that JONATHAN COLON, 29, formerly of Meriden, pleaded guilty today before U.S. District Judge Stefan R. Underhill in Bridgeport to possession of a firearm by a felon.
According to court documents and statements made in court, on March 5, 2018, Colon was arrested at a hotel in Groton where he possessed a Springfield Armory .45 caliber semiautomatic handgun.
Colon’s criminal history includes a state felony conviction for a robbery offense. 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.
Judge Underhill scheduled sentencing for August 10, 2021, at which time Colon faces a maximum term of imprisonment of 10 years. Colon is released pending sentencing.
This investigation has been conducted by the Federal Bureau of Investigation, Town of Groton Police Department and New London Police Department. The case is being prosecuted by Assistant U.S. Attorney Lauren C. Clark.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make neighborhoods safer for everyone.
Federal Jury Convicts Jacksonville Man of Tax Fraud for Preparing Fraudulent Tax ReturnsRead the Press Release
Jacksonville, Florida – A federal jury has found Paul Berkins Moise guilty of 14 counts of filing false returns on behalf of (unknowing) clients and 3 counts of filing false tax returns on behalf of himself. Moise faces a maximum penalty of three years in federal prison for each count. The United States will also seek restitution for the tax losses arising out of the fraud. Moise’s sentencing hearing is scheduled for August 9, 2021.
Moise had been indicted on February 6, 2019.
According to testimony and evidence presented at trial, Moise owned and operated a tax preparation business in Jacksonville. Between February 2013 and March 2017, Moise defrauded the IRS by filing returns for his clients in which he grossly inflated deductions for state and local sales taxes, unreimbursed employee expenses, and gifts to charity by cash or check.
For example, on one tax return, Moise claimed a sales tax deduction of $5,883 for a client who had a gross income of $43,476. In order for that client to claim a sales tax deduction that large, the client would have had to have made taxable purchases totaling $89,926 (including the tax) -- or more than twice the client’s claimed gross income.
Trial evidence also showed that Moise grossly underreported his own income on tax returns he filed for himself for the years 2013, 2014, and 2015. On his 2013 return, Moise reported $10,160 in income when he actually earned at least $83,848 that year. On his 2014 return, Moise reported $2,695 in income when he actually earned $252,652 that year. On his 2015 return, Moise reported $10,255 in income when he actually earned $234,936 that year.
This case was investigated by the Internal Revenue Service – Criminal Investigation. It was prosecuted by Assistant United States Attorney Arnold B. Corsmeier.
Federal Court Shuts Down Florida Tax Return PreparerRead the Press Release
Today, a federal court in Fort Pierce, Florida, permanently barred a Florida tax return preparer from preparing federal tax returns for others.
According to the complaint, Brandhi Shaw prepared tax returns in Belle Glade, Florida, at Premier Financial Services and Premium Financial Solutions. The complaint alleges that Shaw prepared tax returns that purposefully understated the tax her customers owed or overstated the refunds they were entitled to claim. For example, Shaw allegedly prepared tax returns for customers that fabricated business expenses of over $40,000 in one case and over $20,000 in expenses plus over $22,000 in costs of goods sold in another.
The civil injunction order, to which Shaw agreed, was signed by Judge Aileen Cannon of the U.S. District Court for the Southern District of Florida.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams and taxpayers seeking a return preparer should remain vigilant. (More information can also be found here.) The IRS has information on its website for choosing a tax preparer and has launched a free directory of federal tax preparers. In addition, IRS Free File, a public-private partnership, offers free online tax preparation and filing options on IRS partner websites for individuals whose adjusted gross income is under $72,000. For individuals whose income is over that threshold, IRS Free File offers electronical federal tax forms that can be filled out and filed online for free.
In the past decade, the Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department’s website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Faulkton Man Indicted for Meth TraffickingRead the Press Release
Acting United States Attorney Dennis Holmes announced that a Faulkton, South Dakota, man has been indicted by a federal grand jury for Conspiracy to Distribute Methamphetamine.
Frank Daniel Facinelli, age 49, was indicted on February 8, 2021. He appeared before U.S. Magistrate Judge Mark A. Moreno on April 28, 2021, and pled not guilty to the Indictment.
The maximum penalty upon conviction is a mandatory minimum five years, up to 40 years in prison and/or a $5,000,000 fine, at least four years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that beginning at a time unknown, but no later than on or before October 1, 2020, the Defendant knowingly and intentionally, combined, conspired, confederated, and agreed with persons known and unknown, to knowingly and intentionally distribute and possess with the intent to distribute 50 grams or more of methamphetamine in and around Faulkton.
The charge is merely an accusation and Facinelli is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Northern Plains Safe Trails Drug Enforcement Task Force, the U.S. Postal Inspection Service, the South Dakota Division of Criminal Investigation, and the Faulk County Sheriff’s Office. Assistant U.S. Attorney Meghan N. Dilges is prosecuting the case.
Facinelli was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
East St. Louis Man Sentenced to 13 Years for Armed Robbery of Marijuana DealerRead the Press Release
EAST ST. LOUIS, Ill. – An East St. Louis man will be spending over a decade behind bars for
stealing someone’s marijuana at gunpoint. Tyran Jordan, 21, has been sentenced to 157 months in
federal prison on one count of interfering with commerce by robbery and one count of discharging a
firearm during and in relation to a crime of violence. Jordan pled guilty to the charges back in
January.
According to court documents, the crimes occurred on Sept. 30, 2019, when Jordan arranged to sell a
gun to the victim in exchange for marijuana. The deal was supposed to occur in East St. Louis. When
the victim arrived at the designated meeting place, Jordan and two other men brandished their guns
and took the victim’s marijuana and cash by force. As the victim was fleeing the scene, Jordan and
the other men fired their weapons, striking the victim “numerous times.”The court record identifies Jordan’s accomplices as “two unknown individuals.”
In handing down the sentence, United States District Judge Staci M. Yandle noted that the defendant
had not demonstrated any remorse for what he did to the victim. She also explained that a
significant prison sentence was necessary to protect the public and deter Jordan from committing
further crimes.As part of his sentence, Jordan was also ordered to serve a three-year term of supervised release.
This case was brought as part of Project Safe Neighborhoods (PSN), the centerpiece of
the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program
proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders
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 East St. Louis Police Department and the Bureau of Alcohol,
Tobacco, Firearms & Explosives. The case was prosecuted by Assistant United States
Attorney
Alexandria Burns.Dominican National Pleads Guilty to Fentanyl TraffickingRead the Press Release
BOSTON – A Dominican national pleaded guilty in federal court in Boston yesterday to fentanyl trafficking in connection with the seizure of approximately 20 kilos of heroin and 10 kilos of fentanyl. A firearm and $20,000 were also recovered.
Joel Cortorreal a/k/a Angel Javier Morell-Oneill, 33, a Dominican national previously residing in Methuen, pleaded guilty to one count of possession with intent to distribute 400 grams or more of fentanyl, one count of possession of a firearm in furtherance of a drug trafficking crime, one count of unlawful reentry of a deported alien and one count of being an illegal alien in possession of a firearm and ammunition. U.S. District Court Judge Leo T. Sorokin scheduled sentencing for Sept. 8, 2021.
According to the charging documents, an investigation into Cortorreal began in June 2018 and culminated with a traffic stop on Pleasant Valley Street in Methuen on Oct. 22, 2018. During the top, officers seized two kilos of fentanyl from the front passenger seat of the vehicle Cortorreal was driving.
Law enforcement executed a search warrant at Cortorreal’s residence in Methuen and seized approximately 20 kilos of heroin, over eight kilos of fentanyl, drug distribution paraphernalia and a loaded firearm.
Cortorreal faces a mandatory minimum of 15 years and up to life in prison, a mandatory minimum of five years and up to a lifetime of supervised release, and a fine of up to $10 million. Sentences are imposed by a federal district court judge based on the United States Sentencing Guidelines and other statutory factors.
Acting United States Attorney Nathaniel R. Mendell; Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration, New England Field Division; and Colonel Christopher Mason, Superintendent of the Massachusetts State Police made the announcement today. Valuable assistance was provided by the Somerville, Medford, Boston, Ipswich and Arlington Police Departments. Assistant U.S. Attorney Katherine Ferguson of Mendell’s Narcotics and Money Laundering Unit is prosecuting the case.
Daytona Beach Drug Trafficking Conspiracy Leaders Sentenced to 30 and 20 Years in PrisonRead the Press Release
Orlando, Florida – U.S. District Judge Carlos E. Mendoza today sentenced Maxwell Garvice Johnson (29, Ormond Beach) to 30 years in federal prison for his involvement in a drug distribution conspiracy. The court also sentenced Robert Lee Hamilton, Jr. (36, Daytona Beach) to 20 years’ imprisonment. Johnson had pleaded guilty in February 2021. Hamilton had pleaded guilty in December 2020.
According to court documents, from April 3 through July 30, 2020, Johnson, Hamilton, and their conspirators worked to distribute methamphetamine, heroin, fentanyl-laced heroin, and cocaine in the Daytona Beach area. During the investigation, and in a series of searches and arrests, on July 30, 2020, law enforcement officers recovered and identified more than 2 kilograms of fentanyl-laced heroin, over 500 grams of cocaine, and at least 155 grams of methamphetamine that was being distributed by members of Johnson’s organization, as well as loaded firearms and tens of thousands of dollars in drug proceeds. The court ruled that both Hamilton and Johnson’s sentences reflected their leadership and managerial roles in the drug trafficking organization, their maintenance of multiple stash houses for drug distribution, and their possession of firearms.
Eight of nine of the conspirators have pleaded guilty; seven have been sentenced as follows:
Defendant
Federal Prison Term
Maxwell Garvice Johnson
30 years
Robert Lee Hamilton, Jr.
20 years
Jeniver Sebastian Scott, Jr.
10 years
Dawnte Dequine Benjamin Davis
7 years, 8 months
Sharodd Solomon Favors
7 years
Jeremy Rashan Tarrand
5 years, 10 months
Felicia Mae Riley
1 year, 3 months
The court has delayed the sentencing of Shakia Flagler, who pleaded guilty on January 13, 2021. A final defendant, Gena Marie Walker, is scheduled for trial in July 2021.
This case was investigated by the Federal Bureau of Investigation, with assistance from the Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Daytona Beach Police Department, and the Volusia County Sheriff’s Office. It is being prosecuted by Assistant United States Attorney Dana E. Hill.
Connecticut Business Owner, Poker Player, Sentenced to Prison for Tax EvasionRead the Press Release
Leonard C Boyle, Acting United States Attorney for the District of Connecticut, announced that GUY SMITH, 63, of Shelton, was sentenced today by U.S. District Judge Michael P. Shea in Hartford to 14 months of imprisonment, followed by two years of supervised release, for tax evasion.
According to court documents and statements made in court, Smith owns and operates Centerline Interiors LLC, a business that specializes in commercial interior construction. Smith is also a professional poker player and has participated in poker tournaments at casinos in Connecticut and other locations around the U.S. and The Bahamas. Smith withdrew funds from both his business and personal bank accounts for his gambling business.
For the 2012 through 2016 tax years, Smith furnished his tax preparer with a summary of Centerline’s income and expenses, which the tax preparer used to prepare Smith’s federal income tax returns. Smith did not provide his tax preparer with any bank statements. During these five years, Smith intentionally failed to report to his tax preparer, and to the IRS, approximately $1.1 million in income he received from Centerline Interiors. In addition, even though the IRS notified Smith on multiple occasions that he was required to report all of his gambling income on his federal tax returns, Smith concealed his gambling income from his tax preparer and paid no income taxes on more than $1 million in gambling winnings.
For the 2012 through 2016 tax years, Smith failed to pay a total of $821,415 in federal income taxes. Judge Shea ordered Smith to pay all outstanding taxes, interest and penalties.
Smith pleaded guilty to the offense on December 10, 2020.
Smith, who is released on bond, is required to report to prison on June 30, 2021.
This case was investigated by the Internal Revenue Service – Criminal Investigation Division, and was prosecuted by Assistant U.S. Attorney Michael S. McGarry.
Buffalo Man Sentenced for Conspiring with Local Doctor Unlawfully to Obtain DrugsRead 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 Benjamin Rivera, 42, of Buffalo, NY, who was convicted of conspiring to possess with intent to distribute, and distributing, oxycodone and amphetamine, was sentenced to time served (approximately 28 months) and 12 months of home confinement by U.S. District Judge Lawrence J. Vilardo.
Assistant U.S. Attorney Joshua A. Violanti, who handled the case, stated that between January 2014, and February 2018, the defendant conspired with Dr. James T. Keefe, Laura Ricotta, and others, to sell oxycodone and amphetamine. Rivera and Dr. Keefe were associates for several years. For nearly five years, the defendant sold cocaine to Dr. Keefe, who was an active user of cocaine, Adderall, and prescription opiates. In January 2014, Dr. Keefe began issuing prescriptions in the names of Rivera’s relatives and associates to exchange for cocaine from the defendant and to share the prescriptions with the defendant. In 2015, Rivera introduced Dr. Keefe to co-defendant Laura Ricotta, at which time Dr. Keefe began issuing prescriptions in Ricotta’s name, for his and Ricotta’s personal use.
Rivera received from Dr. Keefe five prescriptions in Rivera’s own name and 17 prescriptions in the names of nine relatives and associates. Neither the defendant nor any of his relatives or associates were patients of Dr. Keefe, and all 22 prescriptions were fraudulently issued without a legitimate medical purpose.
Dr. Keefe was previously convicted and is awaiting sentencing. Laura Ricotta was also previously convicted and sentenced to time served (approximately 15 months).
The sentencing is the result of an investigation by the Drug Enforcement Administration, under the direction of Special Agent-in-Charge Ray Donovan.
# # # #
Browning man sentenced to prison for strangling dating partnerRead the Press Release
GREAT FALLS – A Browning man who admitted to strangling his dating partner on two separate occasions on the Blackfeet Indian Reservation was sentenced on April 29 to 40 months in prison and to two years of supervised release, Acting U.S. Attorney Leif M. Johnson said today.
Drew Dion Gallineaux, 27, pleaded guilty on Jan. 13 to two counts of strangulation of a dating partner.
Chief U.S. District Judge Brian M. Morris presided. Gallineaux was detained.
According to court documents, the government alleged that on Dec. 22, 2019, Gallineaux and the victim were drinking and got into an argument. Gallineaux assaulted the victim, including strangling her. The government further alleged that on July 8, 2019, Gallineaux assaulted and strangled the victim while in a vehicle. Both assaults occurred in Browning.
The Bureau of Indian Affairs and Blackfeet Law Enforcement Services investigated the case.
Assistant U.S. Attorney Kalah A. Paisley and Special Assistant U.S. Attorney and Blackfeet Tribal Prosecutor Josh Lamson prosecuted the case. In addition to prosecuting misdemeanor crime in Tribal Court, Lamson, as a Special Assistant U.S. Attorney, assists with the prosecution of felony crimes occurring on the reservation in federal court. The position is funded through a U.S. Department of Justice, Bureau of Justice Assistance grant that was awarded to the Blackfeet Tribe in 2018. The grant supports collaboration between the Blackfeet Indian Nation and the U.S. Attorney’s Office to improve public safety on the reservation.
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Brooklyn Man Pleads Guilty to Sabotage of NYPD Vehicle and Covid-19 Related FraudRead the Press Release
Earlier today, in federal court in Brooklyn, Jeremy Trapp pleaded guilty before United States Magistrate Judge Cheryl L. Pollak to one count of destruction of a vehicle for his cutting a brake line of a New York City Police Department (“NYPD”) van during a time of anti-law enforcement protests in the summer of 2020, and one count of wire fraud in connection with the Economic Injury Disaster Loan (“EIDL”) program.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the guilty pleas.
“With his admissions of guilt today, Trapp will face the consequences of his flagrantly lawless and fraudulent conduct, first, in endangering the lives of police officers by sabotaging one of their vehicles, and second, by lining his pockets with stolen government funds intended to provide relief during the COVID-19 pandemic.” stated Acting United States Attorney Lesko. “This Office and its law enforcement partners will bring to justice any individual who deliberately jeopardizes the safety of the police and steals funds from government programs intended to help deserving recipients.”
As set forth in court filings and today’s proceeding, on July 17, 2020, Trapp crawled under a marked NYPD van parked near Fourth Avenue and 42nd Street in Sunset Park and partially severed a line that is part of the NYPD Van’s anti-lock braking system, which is similar in appearance to, and in the same location as, the NYPD vehicle’s main brake line. A malfunctioning anti-lock braking system adversely impacts a driver’s ability to stop and maintain control of a vehicle in an emergency.
In addition, in June 2020, Trapp submitted a fraudulent EIDL loan and grant application. The EIDL program provides qualifying small businesses with low-interest loans. The Coronavirus Aid, Relief and Economic Security (CARES) Act expanded EIDL to provide economic support to help offset the temporary loss of revenue experienced by businesses due to the COVID-19 pandemic. In the application, Trapp claimed that he was the sole proprietor of a car wash business located at his home address in Brooklyn, which, in reality, is a multi-unit residential building. Trapp further represented that he employed 10 individuals and that his gross revenue for the 12 months prior to the COVID-19 pandemic was $150,000. Based on Trapp’s false representations, the Small Business Administration approved a $42,500 loan and $10,000 grant to Trapp, and these funds were deposited into Trapp’s bank account.
The government’s case is being handled by the Office’s National Security and Cybercrime Section. Assistant United States Attorneys Francisco J. Navarro and Sara K. Winik are in charge of the prosecution.
The Defendant:
JEREMY TRAPP
Age: 24
Brooklyn, New YorkE.D.N.Y. Docket Nos. 20-CR-308 and 20-CR-454
Boston Gang Associate Pleads Guilty to Cocaine TraffickingRead the Press Release
BOSTON – A Boston gang associate pleaded guilty Wednesday, April 28, 2021 in federal court in Boston to a cocaine and firearm possession charges.
Kareem Chaplin, 47, of Canton, pleaded guilty to conspiracy to distribute and possession with intent to distribute cocaine and cocaine base. U.S. District Court Judge Richard G. Stearns scheduled sentencing for Aug. 25, 2021.
In June 2020, Chaplin was charged along with 23 others as part of Operation Snowfall. According to the charging documents, beginning in November 2018, law enforcement conducted an investigation into drug trafficking activities by Boston-based street gang members and associates in the Commonwealth Development in Brighton, Mass., formerly known as Fidelis Way, a multi-apartment public housing development. It is alleged that the defendants, through their drug trafficking activities, assumed control over multiple apartments, where they stored, cooked, packaged and sold drugs. As a result, their activities caused a blight of the development and reduced the quality of life of the other residents.
The investigation, which included Chaplin, also targeted large-scale drug suppliers and their associates. It is alleged that the targets continued to distribute cocaine and cocaine base throughout the COVID-19 pandemic and shutdown. Chaplin is the third defendant to plead guilty in the case.
During the investigation, investigators executed a search warrant at a “stash house” associated with Chaplin and recovered over 400 grams of cocaine, six firearms and multiple rounds of ammunition.
The charge of conspiracy to distribute and possession with intent to distribute cocaine and cocaine base provides for a sentence of up to 20 years in prison, at least three years and up to life of supervised release and a fine of up to $1 million. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney Nathaniel R. Mendell; Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration, Boston Field Division; John Gibbons, U.S. Marshal for the District of Massachusetts; Colonel Christopher Mason, Superintendent of the Massachusetts State Police; and Boston Police Acting Commissioner Gregory Long made the announcement. Assistance with the investigation was provided by the Braintree, Cambridge, Canton, Randolph and Weymouth Police Departments; the Suffolk, Norfolk and Bristol County District Attorneys’ Offices; and the Suffolk, Plymouth and Norfolk County Sheriffs’ Office. Assistant U.S. Attorneys Kaitlin O’Donnell and Timothy Moran of Mendell’s Organized Crime and Gang Unit are prosecuting the case.
The details contained in the charging documents are allegations. The remaining defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Birmingham Man Sentenced to Prison for Illegal Possession of Firearms and Body ArmorRead the Press Release
BIRMINGHAM, Ala. – A federal judge this week sentenced a Birmingham man to 108 months in prison, announced U.S. Attorney Prim F. Escalona and Bureau of Alcohol, Tobacco, Firearms and Explosives Special Agent in Charge Mickey French.
U.S. District Judge Annemarie Carney Axon sentenced Eilone Austin Bland, 28, of Birmingham, to a total of 108 months in prison on two counts of being a felon in possession of a firearm and one count of being a violent felon in possession of body armor. Bland pleaded guilty to these charges in January 2021.
In June 2020, a federal grand jury indicted Bland for being a felon in possession of a firearm. That charge arose from a March 5, 2019 traffic stop by Birmingham police officers. The officers found a Taurus 9-millimeter pistol in Bland’s pocket. Bland had a 2016 state court conviction for attempted murder, which barred him from possessing firearms.
In July 2020, when the United States Deputy Marshals arrested Bland at his home, they found a .40 caliber Glock pistol and a body armor vest in his bedroom. A superseding indictment was filed charging him for possessing the second pistol and the body armor.
The ATF investigated the cases with the assistance of the Birmingham Police Department and the United States Marshals Service. Assistant U.S. Attorney Alan Baty prosecuted.
Bedford Attorney Sentenced to 72 Months for Wire Fraud and Money Laundering Related to Theft of Client FundsRead the Press Release
CONCORD - John Allen, 63, of Bedford, New Hampshire, was sentenced to 72 months in federal prison for wire fraud and money laundering, Acting United States Attorney John J. Farley announced today.
According to court documents and statements made in court, Allen was a New Hampshire attorney who provided legal services related to, among other things, commercial real estate acquisition and development and secured lending transactions. As an attorney in New Hampshire who handled clients’ funds, Allen was required to maintain two Interest on Lawyer Trust Accounts (commonly known as IOLTA).
From approximately January of 2014 through October of 2019, Allen engaged in a scheme to defraud several of his clients of over $2.5 million. Allen’s clients gave him funds to hold in escrow for specific purposes, including private lending, real estate transactions, and particular business deals. Although Allen told his clients he would hold the funds in his IOLTA for these purposes, he transferred those funds between his IOLTAs and, without authority to do so, into another bank account he controlled. He then spent the funds on his own personal expenses and for unrelated business expenses. All the while, he misled these clients by representing that the funds were in one of his IOLTAs or were being used for their intended purposes.
For example, Allen caused one client to invest more than $1.5 million in fraudulent promissory notes that Allen created using other persons’ identities. Allen did not invest the money and instead kept it for himself. Allen also stole nearly $1 million from other clients by transferring money they had provided for specific real estate transactions from his IOLTA to other accounts he controlled. To hide the sources of the funds he stole from his clients, Allen comingled fraud proceeds and legitimate funds, made many transfers back and forth between accounts, and spent the funds in those accounts on unrelated business and personal expenses. In total, Allen stole more than $2.5 million from his clients.
Allen pleaded guilty on November 12, 2020 and was originally scheduled to be sentenced at 10:00 am on February 25, 2021. Allen failed to appear at his sentencing hearing. The Court issued a warrant and investigators arrested Allen at around noon in a hotel in Manchester. While trying to locate Allen, investigators learned that after pleading guilty to defrauding his clients, Allen stole $10,000 from his girlfriend’s father by stealing a check from his girlfriend’s father’s checkbook and writing himself a check.
Allen’s license to practice law in New Hampshire was suspended in 2019. He was disbarred in February 2021. In addition to his prison sentence, Allen was ordered to pay restitution and forfeit $2,561,258.15. This restitution and forfeiture amount includes the $10,000 Allen stole after pleading guilty.
“John Allen not only stole his client’s money, but he betrayed their trust and violated his obligations as an attorney,” said Acting U.S. Attorney Farley. “While any white collar crime is unacceptable, this defendant’s actions were particularly reprehensible because he used his status as an attorney to take advantage of his clients for his own personal benefit. Thanks to the hard work of the FBI, we have sought justice for Allen’s victims. This substantial prison sentence should serve as a warning to other attorneys that stealing from clients is a serious crime.”
“John Allen had no reservations about lying to his clients, doing so deliberately and repeatedly, while pocketing more than $2.4 million of their hard-earned money for his own personal use,” said Joseph R. Bonavolonta, Special Agent in Charge of the FBI Boston Division. “While we can never make his victims whole financially or emotionally, today he is being held accountable and that is some measure of justice for those he’s wronged. Rest assured, the FBI is working hard every day to shut down schemes like this one in order to protect others from being fleeced.”
This matter was investigated by the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorney Matthew T. Hunter.
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Aroostook County Man Pleads Guilty to Federal Drug ChargeRead the Press Release
BANGOR, Maine: An Aroostook County man pleaded guilty in federal court today to conspiring to distribute and possess with intent to distribute methamphetamine, Acting U.S. Attorney Donald E. Clark announced.
According to court records, between approximately July 2018 and May 2019, members of the conspiracy obtained methamphetamine in western and southern states from sources in Mexico. Jeff Curtis, 40, and his co-conspirators then distributed the drugs in Aroostook County and other parts of central and northern Maine.
Curtis faces up to 20 years in prison and a fine of up to $1 million. He also faces between three years and a lifetime of supervised release. He will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
The U.S. Drug Enforcement Administration, Homeland Security Investigations and the Maine Drug Enforcement Agency investigated this case with the assistance of multiple state and local law enforcement agencies.
This prosecution is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
Arkansas Man Arrested for Receipt and Possession of Child PornographyRead the Press Release
FAYETTEVILLE – A Springdale man was arrested yesterday for receiving and possessing material depicting the sexual abuse of children.
According to court documents, Joshua James Duggar, 33, allegedly used the internet to download child sexual abuse material. Duggar allegedly possessed this material, some of which depicts the sexual abuse of children under the age of 12, all in May 2019.
Duggar is charged by indictment with receiving and possessing child pornography. If convicted he faces up to 20 years of imprisonment and fines up to $250,000.00 on each count. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
This case is being prosecuted 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 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.justice.gov/psc.
Acting U.S. Attorney David Clay Fowlkes of the Western District of Arkansas; and Acting Special Agent in Charge Jack Staton of Homeland Security Investigations New Orleans made the announcement.
This case is being investigated by Homeland Security Investigations Fayetteville and the Northwest Arkansas Internet Crimes Against Children (ICAC) Task Force.
The case is being prosecuted by Assistant U.S. Attorneys Carly Marshall and Dustin Roberts, and Trial Attorney William G. Clayman of the Justice Department’s Child Exploitation and Obscenity 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.