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30 April 2021
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.
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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.
Albuquerque man arraigned on charge of being a felon in possession of a firearmRead the Press Release
ALBUQUERQUE, N.M. – Rastice Lee Burdex, 28, of Albuquerque, was arraigned on April 26 in federal court on an indictment for being a felon in possession of a firearm. A federal grand jury indicted Burdex on Sept. 10, 2020. Burdex will remain detained pending trial.
According to the indictment and other court records, on Aug. 20, 2020, Albuquerque Police stopped the vehicle in which Burdex was traveling. A search of the vehicle allegedly revealed a loaded handgun beneath the drivers’ seat.
Burdex was previously convicted of aggravated battery against a household member with a deadly weapon and aggravated assault with a deadly weapon. As a previously convicted felon, Burdex cannot legally possess a firearm or ammunition.
An indictment is only an allegation. A defendant is presumed innocent unless and until proven guilty. If convicted, Burdex faces up to 10 years in prison.
The FBI Albuquerque Field Office investigated this case with assistance from the Albuquerque Police Department. Assistant U.S. Attorney Alexander M. Uballez is prosecuting the case.
29 April 2021
Youth Soccer Association Treasurer Admits Stealing $100,000 for Personal ExpensesRead the Press Release
PITTSBURGH, PA - A Beaver County resident pleaded guilty in federal court to a charge of wire fraud, Acting United States Attorney Stephen R. Kaufman announced today.
Jenessa Tolejko, 35, of Beaver, PA 15009 pleaded guilty to one count before United States District Judge Arthur J. Schwab.
In connection with the guilty plea, the court was advised that Tolejko, while serving as Treasurer of the Brighton Township – Beaver Soccer Association, a volunteer-run youth soccer association, improperly used $100,000 of the soccer association’s money for personal expenditures, including a cruise, other travel, goods from Amazon and LuLaRoe, and her household bills.
Judge Schwab scheduled sentencing for August 26, 2021 at 9:30 a.m. The law provides for a total sentence of 20 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Pending sentencing, the court permitted Tolejko to remain free on bond.
Assistant United States Attorney Jeffrey R. Bengel is prosecuting this case on behalf of the government.
The United States Postal Inspection Service and the Beaver Borough Police Department conducted the investigation that led to the prosecution of Tolejko.
Woonsocket Man Sentenced for Laundering Proceeds in Transcontinental Drug Trafficking OperationRead the Press Release
PROVIDENCE – A Woonsocket man with a lengthy Rhode Island state and federal criminal record and a history of violating conditions of his probation and supervised release was sentenced today to four years in federal prison for laundering as much as $500,000 in proceeds from the trafficking of marijuana in the Woonsocket area; the marijuana was obtained from a west coast-based drug trafficking organization.
Kyle S. Minot, 31, previously admitted to the court that he employed at least five individuals to deposit the proceeds of dozens of drug sales into “feeder” bank accounts, representing payment he owed his marijuana suppliers, a California-based drug trafficking organization. “Feeder” accounts, held in fictious names, conceal the origin and ownership of the money. Each deposit was kept to just under $10,000 to avoid bank reporting laws. The proceeds were withdrawn from the accounts by members of the drug trafficking organization in California.
According to information presented to the court, Minot’s drug trafficking and money laundering activities came to light during a long-term DEA and IRS led Boston Strike Force investigation begun in the fall of 2014 into the leadership of the transcontinental marijuana trafficking and money-laundering organization. Minot was later identified as having met in nearby Massachusetts with the leader of the organization in furtherance of the scheme.
According to court documents, Minot’s role in the marijuana trafficking and money laundering organization came to light while Minot was simultaneously the subject of a wide-ranging Rhode Island State Police investigation into the criminal activities of members of a motorcycle gang code named Operation Patched Out. Minot was heard on a State Police wiretap discussing his ongoing marijuana trafficking activities and obtaining stolen equipment for use in his landscaping business. Minot was incarcerated after his arrest as a state probation violator and was later convicted in state court on 14 charges, including receiving stolen property and drug trafficking offenses. He was sentenced to five years in prison – one year to serve, the remainder suspended with probation.
At the time Minot was overheard on the State Police wiretap discussing his then-ongoing criminal activities, Minot was subject to federal supervised release, having been convicted and sentenced for firearms trafficking. Separately, while on federal supervised release in that matter, Minot was convicted in state court on drug trafficking charges and a motor vehicle offense.
Appearing today before U.S. District Court Judge Mary S. McElroy, Minot, who pled guilty on October 25, 2019, to money laundering, was sentenced to 48 months in federal prison to be followed by three years of federal supervised release, and to pay a fine of $20,000, announced Acting United States Attorney Richard B. Myrus, Special Agent in Charge of the Drug Enforcement Administration’s New England Field Division Brian D. Boyle, and Acting Special Agent in Charge of Internal Revenue Service Criminal Investigation Ramsey E. Covington.
The case was prosecuted by Assistant United States Attorney Gerard B. Sullivan.
Acting United States Attorney Myrus thanks the Woonsocket Police Department and Rhode Island State Police for their assistance in this matter.
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Woman Sentenced to 90 Months for Distributing Methamphetamine in MenomonieRead the Press Release
MADISON, WIS. – Timothy M. O’Shea, Acting United States Attorney for the Western District of Wisconsin, announced that Diana Xiong, 39, Eau Claire, Wisconsin, was sentenced today by Chief U.S. District Judge James D. Peterson to 90 months in federal prison for distribution of methamphetamine. This prison term will be followed by 4 years of supervised release.
The charges in this case stem from an investigation conducted by law enforcement in the summer of 2020. On two occasions, Xiong sold methamphetamine to a confidential informant in Menomonie, Wisconsin. She also sold the same confidential informant a firearm, although she is prohibited from possessing any firearms because she is a convicted felon.
At sentencing, Judge Peterson explained a substantial sentence was warranted because of Xiong’s consistent and disturbing pattern of drug distribution, which she continued even after serving state sentences related to distributing methamphetamine. He also noted that while Xiong was smart and capable, she had unfortunately applied those qualities to drug dealing.
Judge Peterson ordered this federal sentence to run concurrent to a state prison sentence Xiong is now serving due to revocation of state supervision. Xiong was on state supervision at the time of the offenses in this case.
The charges against Xiong were the result of an investigation conducted by the Dunn County Sheriff’s Office, West Central Drug Task Force, Drug Enforcement Administration, and Bureau of Alcohol, Tobacco, Firearms and Explosives. The prosecution of the case has been handled by Assistant U.S. Attorney Taylor L. Kraus.
Woman Sentenced to 24 Months for Laundering Funds from Lottery Fraud Scheme Targeting the ElderlyRead the Press Release
TUCSON, Ariz. – Shanelle Bailey, 23, a Jamaican-born women living in Provo, Utah, was sentenced yesterday by U.S. District Judge Rosemary Marquez to 24 months in prison. Bailey previously pleaded guilty to Conspiracy to Commit Money Laundering.
Bailey participated in a scheme where Jamaican-based scammers called elderly victims in the United States, claiming the victims had won a lottery. To receive their winnings, the victims were told they must first pay money for taxes and fees. Bailey’s role in this scheme was to launder the fraudulent proceeds for fellow co-conspirators in Jamaica. The loss suffered by the victims exceeded $600,000.
As part of her sentence, Bailey will also be required to pay restitution in the amount of $80,850 to the victims in the case.
The U.S. Attorney’s Office encourages the public to be wary of similar scams and to verify with law enforcement and family members before sending money after a phone solicitation.
The Internal Revenue Service – Criminal Investigation, the Federal Trade Commission, the United States Postal Inspection Service, the Federal Bureau of Investigation, Homeland Security Investigations, and the Pima County Sheriff’s Department conducted the investigation in this case. The U.S. Attorney’s Office, District of Arizona, Tucson, handled the prosecution.
CASE NUMBER: CR-19-01275-TUC-RM(LAB)
RELEASE NUMBER: 2021-030_Bailey# # #
For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.Wilmington Man Sentenced to 10 Years in Federal Prison for Receipt of A Gun and AmmunitionRead the Press Release
WILMINGTON, Del. – A Wilmington man was sentenced on April 27 to 10 years in federal prison by the Honorable Colm F. Connolly, U.S. District Judge for the District of Delaware, for receipt of a firearm and ammunition with the intent that a felony would be committed with that firearm and ammunition. David C. Weiss, U.S. Attorney for the District of Delaware, made the announcement.
According to court documents, Angel Ortiz, 36, was arrested by the New Castle County Police Department on November 29, 2018, after he got out of a car during a traffic stop, ran away, and threw a loaded firearm. The firearm was recovered and found to be a Remington 1911 .45 caliber handgun with an extended magazine. Mr. Ortiz had previously been convicted of a felony offense and was not legally permitted to possess the Remington handgun.
U.S. Attorney Weiss stated, “Violent crime destroys neighborhoods. Together with our law enforcement partners, my Office is committed to doing all we can to get guns off our community’s streets and out of the hands of individuals who illegally possess them.”
“In our fight against violent crime, every gun taken off the street is a small victory, and every gun trafficker locked up is a big one," said Rachel Byrd, Acting Special Agent in Charge of the FBI Baltimore Field Office. "The FBI and our partners are committed to working together across jurisdictions to take down the criminals wreaking such havoc in our communities.”
This case is part of Project Safe Neighborhoods (PSN), a federal program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The U.S. Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
The case was investigated by the FBI-Baltimore Division’s Wilmington Resident Agency and is being prosecuted by Assistant U.S. Attorneys Maureen McCartney and Laura Hatcher.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the District of Delaware. Related court documents and information is located on the website of the District Court for the District of Delaware or on PACER by searching for Case No. 19-3-CFC.
Virginia Beach Couple Pleads Guilty to $31 Million Coupon Fraud SchemeRead the Press Release
NORFOLK, Va. – A Virginia Beach couple pleaded guilty this week to perpetrating a counterfeit coupon fraud scheme that cost retailers and manufacturers over $31 million in losses.
“These defendants orchestrated a nationwide scheme to make and sell counterfeit coupons, which defrauded businesses out of more than $31 million,” said Raj Parekh, Acting U.S. Attorney for the Eastern District of Virginia. “Counterfeiting coupons harms the entire retail industry and causes financial loss to consumers, businesses, and the economy. As this case demonstrates, those who use illegal get-rich-quick schemes to deceive others will be brought to justice.”
According to court documents, from approximately April 2017 through May 2020, Lori Ann Talens, 41, operated a complex scheme using social media sites and apps such as Facebook and Telegram to find groups of coupon enthusiasts and sell them counterfeit coupons. Lori Ann Talens, who operated online under the moniker “MasterChef,” used a computer to design, create, and produce a wide variety of counterfeit coupons in her Virginia Beach home. These counterfeit coupons were virtually indistinguishable from authentic coupons and were often created with inflated values, far in excess of what an authentic coupon would offer, in order to receive items from retail for free or for a greatly reduced price.
“Whenever someone uses the U.S. Mail to send counterfeit, illegal or improper items, Postal Inspectors will find them and bring them to justice,” said Peter R. Rendina, Postal Inspector in Charge, Washington Division of the U.S. Postal Inspection Service. “We remain committed to keeping the mail safe for our customers and our employees.”
As part of the scheme, Lori Ann Talens would ship the counterfeit coupons throughout the United States using the U.S. Postal Service and other commercial parcel delivery services. She accepted payment for the counterfeit coupons through a variety of online payment methods, including Bitcoin and Paypal. Lori Ann’s husband, Pacifico Talens, 43, was aware of the counterfeit coupon scheme, profited from it, and assisted in the operation by shipping packages of counterfeit coupons and performing other administrative tasks at the direction of his wife.
The scheme was discovered when one of the Talens’s customers reported them to the Coupon Information Center (CIC), a coalition of consumer product manufacturers dedicated to coupon integrity. The CIC purchased coupons from the Talens, confirmed they were counterfeit, and contacted the U.S. Postal Inspection Service for further investigation.
After identifying the defendants as the source of the counterfeit coupons, federal law enforcement executed a search warrant on their residence. During the search, agents seized nearly $1 million worth of counterfeit coupons from the residence. Furthermore, a review of the Talens’s computer revealed images for over 13,000 separate and distinct counterfeit coupon designs. The CIC reviewed these images and compared them to the known counterfeit coupons in circulation. The analysis concluded that coupon redemptions using the 13,000 counterfeit designs on the couple’s computer had caused approximately $31,817,997 million in losses to retailers and manufacturers.
In a separate scheme, from approximately November 2015 through February 2020, Lori Ann Talens defrauded Medicaid and the Supplemental Nutrition Assistance Program (SNAP). Lori Ann Talens applied for benefits for each of these programs and failed to disclose either her husband Pacifico’s legitimate employment income, or their own illegitimate counterfeit coupon income. Had she disclosed this income, the Talens would not have been eligible for these benefits. The total loss to Medicaid and SNAP was approximately $43,000.
Both defendants pleaded guilty to mail fraud. Lori Ann Talens also pleaded guilty to wire fraud and health care fraud. Lori Ann Talens is scheduled to be sentenced on August 31, and she faces a maximum penalty of 50 years in prison. Pacifico Talens is scheduled to be sentenced on August 19, and he faces a maximum penalty of 20 years in prison. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
Raj Parekh, Acting U.S. Attorney for the Eastern District of Virginia; Peter R. Rendina, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service; and Brian Dugan, Special Agent in Charge of the FBI’s Norfolk Field Office, made the announcement after U.S. District Judge Roderick C. Young accepted the plea.
Assistant U.S. Attorney Joseph Kosky is prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:21-cr-39.
Valley drug trafficking organizer gets life in prisonRead the Press Release
BROWNSVILLE, Texas – A 40-year-old resident of Brownsville has been ordered to federal prison following his role in trafficking more than 1000 kilograms of cocaine involving $26 million in drug proceeds, announced Acting U.S. Attorney Jennifer B. Lowery.
The jury deliberated for less than three hours before convicting Rafael Villanueva Jan. 28, following a six-day trial.
Today, U.S. District Judge Fernando Rodriguez Jr., who presided over the trial and sentencing, ordered Villanueva to serve the rest of his life in federal prison. The court also ordered Villanueva to pay a $1,193,070 money judgment as repayment for the drug money he illegally laundered.
“This sentencing is the result of a long-term complex investigation lead by federal, state and local law enforcement agencies who continue to serve and protect our public and national security said Deputy Special Agent in Charge Timothy Tubbs of Homeland Security Investigations (HSI). “HSI and our counterparts will continue to protect our nation from transnational criminal organizations that seek to bring harm to our communities and our nation.”
“The sentencing of Villanueva demonstrates how we focus investigative resources against drug trafficking organizations that import large shipments of hard drugs from Mexico then deliver them to cities throughout the United States,” said Special Agent in Charge Daniel C. Comeaux of the Drug Enforcement Administration (DEA). “DEA and our partners remain determined to identify, dismantle and destroy drug trafficking organizations that import and spread their poison in cities across our nation.”
During trial, the jury heard from approximately 21 witnesses. They detailed Villanueva’s role as head of a drug transportation group that moved cocaine from the Rio Grande Valley and on to cities throughout the United States. He had customers in Mexico who needed transportation for cocaine to areas throughout the United States, including Houston; Chicago, Illinois; Jackson, Mississippi; as well as locations in South and North Carolina, Virginia and Georgia.
He also provided transportation for drug proceeds sold throughout the United States back to the Rio Grande Valley. The commercial vehicles were outfitted with special compartments to hide the cocaine and drug proceeds.
Several witnesses testified Villanueva hired them to move the cocaine north and the drug proceeds south. Villanueva paid them by the kilogram to transport the drugs and a percentage of the drug money coming south. Fellow drug traffickers also testified Villanueva borrowed their line of transport for the cocaine when commercial drivers he hired got arrested with loads of cocaine.
One of the witnesses was a young male who was only 16 when he started working for Villanueva.
The jury also heard about the search of Villanueva’s house where authorities found five guns and numerous documents showing his lavish lifestyle as well as several Lone Star cards.
The defense attempted to convince the jury the witnesses were all liars and authorities did poor work.
The jury ultimately found him guilty as charged for possession with intent to distribute five kilograms or more of cocaine and conspiracy to do so, conspiracy to launder monetary instruments, bulk cash smuggling and international money laundering.
Villanueva has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
Several others have also been convicted for their respective roles.
HSI and DEA conducted the Organized Crime Drug Enforcement Task Force (OCDETF) operation known as La Camelia. OCDETF identifies, disrupts and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found on the Department of Justice’s OCDETF webpage.
Assistant U.S. Attorneys Karen Betancourt, Jody Young and Paul Marian prosecuted the case.
United States Recovers $8.4 Million in Fraudulent COVID Relief Funds from FamilyRead the Press Release
Orlando, Florida – Acting United States Attorney Karin Hoppmann announces that the United States has obtained a final civil judgment ordering the forfeiture of $8,417,261.38 in proceeds from bank fraud and money laundering offenses related to COVID Relief Fraud.
According to court documents, it is alleged that in April 2020, Joshua Edwards, Joy Edwards, Evan Edwards, and Mary Jane Edwards defrauded the Small Business Administration (“SBA”) out of millions of dollars in coronavirus relief funds. Specifically, Joshua Edwards, on behalf of ASLAN International Ministry, Inc., submitted a false and fraudulent loan application seeking funds from the Paycheck Protection Program (“PPP”). Once the PPP loan was obtained, members of the Edwards family misused the funds by attempting to purchase a $3.7 million luxury home in the Four Seasons Private Residence community at Walt Disney World Resort. The remaining funds were transferred among multiple bank accounts held by the conspirators in an attempt to hide and conceal their whereabouts. Law enforcement was able to seize all of the fraudulently obtained funds before they were dissipated. A request will be made to the Department of Justice’s Money Laundering and Asset Forfeiture Section to remit the forfeited funds back to the SBA.
The Coronavirus Aid, Relief, and Economic Security (“CARES”) Act is a federal law enacted March 2020. It is designed to provide emergency financial assistance to millions of Americans who are suffering the economic effects resulting from the COVID-19 pandemic. One source of relief provided by the CARES Act is the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses through the PPP. In April 2020, Congress authorized over $300 billion in additional PPP funding.
This case was investigated by the United States Secret Service. It was prosecuted by Assistant United States Attorney Nicole Andrejko.
U.S. Attorney's Office, EPA and State of New York Announce Settlement with Holcim (US) Inc. to Address Environmental Violations at Cement Manufacturing FacilityRead the Press Release
ALBANY, NEW YORK - The U.S. Attorney’s Office for the Northern District of New York, the U.S. Environmental Protection Agency (EPA), and the State of New York today announced a settlement with Holcim (US) Inc. to resolve alleged violations of the federal Clean Water Act and New York State water quality regulations at its cement manufacturing facility in Ravena, New York, announced Acting United States Attorney Antoinette T. Bacon.
The settlement, set forth in a consent decree lodged with the U.S. District Court for the Northern District of New York, requires Holcim to comply with the terms of its State Pollutant Discharge Elimination System permit (Permit), pay an $850,000 civil penalty ($212,000 of which will be directed to a NYS Environmental Benefit Project improving stormwater management at Coeymans Landing Park in the Town of Coeymans, New York), and make other physical and operational improvements to the Facility.
The settlement resolves violations alleged in the complaint of the United States and the State of New York, which was filed yesterday. The complaint alleges that, between April 2015 and April 2021, the facility violated the Permit’s numeric effluent limitations 273 times for pollutants such as biological oxygen demand, fecal coliform, total suspended solids, settleable solids, pH, and temperature differential and three prior administrative consent orders issued from 2011 to 2015. The administrative orders document over 150 Permit numeric effluent limitation violations for similar pollutants as well as unauthorized discharges of an unreported sulfuric acid spill, and discharges of partially treated landfill leachate to tributaries of the Hudson River, such as Coeyman’s Creek and Hannacroix Creek. During the course of negotiations over the terms of the Consent Decree, Holcim made substantial improvements to its stormwater and leachate management practices to address the violations at issue, which resulted in the demolition and removal of two failing slurry basins, and installing an impermeable geomembrane-backed French drain along a portion of the perimeter of its landfill. Under the terms of the Consent Decree, Holcim will undertake additional measures to ensure that the Facility is fully compliant with the terms of its Permit by October of 2022.
“We are all custodians of our community’s precious environmental resources. This settlement will benefit the Hudson River, and help preserve this treasured resource for future generations,” said Acting United States Attorney Antoinette T. Bacon.
“This settlement helps protect clean water and ecosystems in the Hudson Valley for local communities and it has already improved Holcim’s compliance with critical federal and state environmental laws,” said EPA acting Region Administrator Walter Mugdan. “This case exemplifies EPA’s commitment to work with our federal and state partners to ensure entities like Holcim comply with regulations that protect public health and the environment.”
“For years, Holcim failed to live up to its legal responsibilities, repeatedly violating laws established to ensure the health of our waters,” said New York Attorney General Letitia James. “Today, we hold this company accountable for polluting our natural resources and we ensure that proper measures are taken to remediate the harm caused to our communities. My office will continue to aggressively enforce the laws that protect the health and safety of our environment and of all New Yorkers.”
“New York State has a long history of holding polluters accountable for their impacts both on our communities and the environment and I thank the U.S. Attorney and the Attorney General for their efforts to finalize this agreement that does just that,” Department of Environmental Conservation (DEC) Commissioner Basil Seggos said. “The Consent Decree announced today will help to resolve years of violations and exceedances under federal and state rules and regulations and requires a significant penalty of $850,000. And in addition to requiring actions to further clean up its operations, this agreement requires this facility to invest in an Environmental Benefit Project that will help improve the health of the Hudson River – a victory for the town of Coeymans.”
This case is being handled by Assistant U.S. Attorney John Hoggan for the United States and Assistant Attorney General Joseph Kowalczyk for the State of New York.
The consent decree is subject to a 30-day public comment period and final court approval. To view a copy of the consent decree and for information on how to submit a comment, visit www.justice.gov/enrd/Consent_Decrees.html.
Two Queens Men Plead Guilty to Multi-Million Dollar Bank Fraud and Identity Theft ConspiracyRead the Press Release
Earlier today, in federal court in Brooklyn, Abed Ahmad and his brother Alaa Ahmad, pleaded guilty before United States District Judge Eric N. Vitaliano to bank fraud conspiracy and conspiracy to commit aggravated identity theft relating to a scheme to defraud JPMorgan Chase & Co. and its customers. Abed Ahmad also pleaded guilty to conspiracy to commit money laundering and one count of aggravated identity theft.
Mark J. Lesko, Acting United States Attorney for the Eastern District of New York, Jonathan D. Larsen, Special Agent-in-Charge, Internal Revenue Service-Criminal Investigation, New York (IRS-CI), Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), John Grasso, Special Agent-in-Charge, Social Security Administration Office of Inspector General, New York Field Office (SSA-OIG), and Cyrus Vance, District Attorney, New York County District Attorney’s Office, announced the guilty pleas.
“The defendants abused their positions of trust at JP Morgan Chase in furtherance of a sordid scheme to steal the identities of elderly and deceased customers in order to misappropriate millions in funds from their accounts,” stated Acting United States Attorney Lesko. “This Office and its law enforcement partners will spare no effort in holding the defendants to account for their brazen fraud.” Mr. Lesko expressed his grateful appreciation to the New York City Police Department’s Intelligence Bureau, U.S. Department of Veterans Affairs Office of Inspector General, and the Social Security Administration Office of Inspector General, for their work on the case.
“Out of sheer greed, the defendants abused their positions to steal from arguably the most vulnerable of banking customers,” stated IRS-CI Special Agent-in-Charge Larsen. “Their admissions today will hopefully provide some measure of closure to all of those impacted by their crimes and put them on a path to full restoration.”
“This $7 million fraud scheme was perpetrated by bank employees that misused their access to sensitive information to victimize the bank and its customers. Today’s guilty pleas highlight that HSI and our law enforcement partners will continue to use every available resource to bring those who prey on innocent victims to justice,” stated HSI Special Agent-in-Charge Fitzhugh.
“These guilty pleas are the result of a true collaborative effort between Federal and local agencies to identify this massive fraud and hold accountable those who abused their authority for personal gain. These individuals stole these funds not only from private citizens and financial institutions, but also from the Social Security Administration,” stated SSA-OIG Special Agent-in-Charge Grasso. “I want to recognize our law enforcement partners, the Manhattan District Attorney’s Office, and the United States Attorney’s Office, for their efforts leading to today’s announcement.”
“These guilty pleas put high-tech cyber thieves on notice: the Manhattan D.A.’s Office has built the expertise, resources, and seamlessly collaborative partnerships to find you, hold you accountable, and secure justice for your victims,” stated District Attorney Vance. “I thank Acting U.S. Attorney Lesko and my Office’s Cybercrime and Identity Theft Bureau for their exceptional collaboration as we continue working together to protect our residents and markets from increasingly sophisticated, large-scale frauds. I also commend my Office’s Forensic Accounting and Financial Investigations Bureau; the NYPD’s Financial Crimes Task Force, Cybercrime and Identity Theft Task Force, and Intelligence Bureau; and our federal partners at IRS and HSI for this expert, joint investigation, as well as the Veterans Affairs OIG and Social Security Administration OIG for their important work.”
As set forth in court filings and today’s proceedings, between approximately 2012 and 2017, Abed and Alaa Ahmad, both of whom worked at branches of JPMorgan Chase & Co. in Queens, used their positions at the bank to target high-dollar value customer accounts of elderly or deceased individuals that had been dormant for a period of time. After identifying these accounts, Abed and Alaa Ahmad passed the account information, as well as the personal identifying information of the account holders, to another co-conspirator, Moustafa Ayoub. Ayoub used the account information to transfer nearly $7 million of victim funds from the JPMorgan Chase accounts to other financial accounts controlled by Ayoub.
Ayoub previously pleaded guilty in January 2021 before Judge Vitaliano to conspiracy to commit bank fraud, conspiracy to commit money laundering, conspiracy to commit aggravated identity theft and aggravated identity theft. He is awaiting sentencing.
The government’s case is being handled by the Office’s National Security and Cybercrime Section, with the assistance of the New York County District Attorney’s Office. Assistant United States Attorneys Josh Hafetz, Jonathan E. Algor and Special Assistant U.S. Attorney Beth F. Potashnick are in charge of the prosecution.
The Defendants:
ABED AHMAD
Age: 37
Boca Raton, FloridaE.D.N.Y. Docket No. 21-CR-095 (ENV)
ALAA AHMAD
Age: 34
Boca Raton, FloridaE.D.N.Y. Docket No. 21-CR-228 (ENV)
MOUSTAFA AYOUB
Age: 50
Queens, New YorkE.D.N.Y Docket No. 20-142 (ENV)
Two Men Sentenced for Roles in Narcotics Distribution OffenseRead the Press Release
NEWARK, N.J. – Two men were sentenced to federal prison terms for possessing a large quantity of cocaine, Acting U.S. Attorney Rachael A. Honig announced today.
Jose Reyes, 60, of the Dominican Republic, was sentenced by videoconference before Chief U.S. District Judge Freda L. Wolfson to 57 months in prison. Ramon Fabian-Pena, aka “Rafael,” 60, of Passaic County, New Jersey, was sentenced by Judge Wolfson on April 21, 2021, to 30 months in prison.
Reyes and Fabian-Pena each previously pleaded guilty to an information charging them with one count of conspiracy to distribute cocaine and one count of possession to distribute cocaine.
According to the documents filed in this case and statements made in court:
On Jan. 7, 2020, Reyes traveled from New York to Passaic, New Jersey, to oversee the delivery of approximately six kilograms of cocaine. At the direction of Reyes, Fabian-Pena took possession of the narcotics from another individual. Law enforcement officers were conducting surveillance of the narcotics transaction and recovered a bag containing approximately six kilograms of cocaine. A lawful search of messages contained on Reyes’ cell phone revealed that Reyes coordinated the narcotics transaction.
In addition to the prison terms, Judge Wolfson sentenced each defendant to three years of supervised release.
Acting U.S. Attorney Honig credited special agents of the Drug Enforcement Administration, under the direction of Special Agent in Charge Susan A. Gibson in Newark, with the investigation leading to today’s sentencing. She also thanked members of the Mercer County Prosecutor’s Office and the Hamilton Township Police Department for their assistance.
This investigation was conducted by a DEA New Jersey Task Force, led by the New Jersey State Police, and composed of DEA special agents and officers from various county and local police departments.
The government is represented by Assistant U.S. Attorney Cassye Cole of the U.S. Attorney’s Office’s Organized Crime and Gangs Unit in Newark.
Two Armed Criminals Convicted in Separate Trials on Same Day Before Same JudgeRead the Press Release
GREENVILLE, South Carolina – Acting United States Attorney M. Rhett DeHart announced today that the United States Attorney’s Office secured two guilty verdicts in two separate cases, on the same day, in the same courtroom, and before the same judge. Specifically, separate federal juries convicted Zavien Lenoy Canada, 38, and Kendrick Omar Cobb, 31, both of Greenville, each for being a felon in possession of a firearm and ammunition.
On Monday morning, the jury trial for Canada began and continued into Tuesday morning. When the Canada jury started deliberations Tuesday, the jury trial for Cobb began. When the Canada jury reached its guilty verdict on Tuesday afternoon, the court paused the Cobb trial to enter the Canada verdict. The court then resumed the Cobb trial, and the jury found Cobb guilty later Tuesday evening.
According to court documents and evidence presented at Canada’s trial, on January 31, 2020, Canada was the passenger in a vehicle pulled over for a suspended license plate. Canada was wanted by the United States Marshals for absconding federal supervised release. Shortly upon exiting the vehicle, Canada fled on foot before being apprehended by officers of the City of Greenville Police Department. During the search of the vehicle, police found a .45 caliber pistol and a magazine loaded with .45 caliber ammunition. Canada was arrested at the scene and taken into custody. Correction officers at the Greenville County Detention Center recovered 3.55 grams of crack cocaine in Canada’s pants.
According to court documents and evidence presented at Cobb’s trial, on the afternoon of March 25, 2018, deputies with the Greenville County Sheriff’s Office conducted a search warrant at Cobb’s residence and recovered a loaded 9mm pistol under the mattress of a bed. Cobb later admitted that the gun was his.
Due to their criminal histories, both Canada and Cobb are prohibited from possessing a gun or ammunition.
Senior United States District Judge Henry M. Herlong, Jr. presided over both trials and will sentence Canada and Cobb after receiving and reviewing pre-sentence reports prepared by the United States Probation Office. Canada likely faces at least fifteen years in federal prison, and Cobb faces up to ten years in federal prison. During the trial, the court took numerous safety measures in light of the pandemic. Large, plexiglass shields separated the jurors, the movement of attorneys about the courtroom was limited, and attorneys and witnesses wore masks unless they were speaking.
“Having two trial teams argue two separate cases in the same courtroom and getting verdicts on the same day is likely a first in this district,” said Acting U.S. Attorney DeHart. “I commend the work of those trial teams and thank the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and our law enforcement partners for their work in bringing these armed criminals to justice, especially during a pandemic. I also want to acknowledge the efforts of the presiding judge, who went to great lengths to ensure the safety of the jurors, lawyers, witnesses, and others involved in the case. These verdicts show that this office will do whatever it takes to keep the people of South Carolina safe.”
“This is a double win for our law enforcement partners and for public safety,” said ATF Special Agent in Charge Vince Pallozzi. “These were very productive, collaborative investigations and each of these convictions takes a very dangerous offender off our streets.”
The ATF is investigating both cases with the assistance of the City of Greenville Police Department in Canada’s case and the Greenville County Sheriff’s Office in Cobb’s case.
Assistant U.S. Attorneys Justin Holloway and Ben Garner are prosecuting the Canada case, and Assistant U.S. Attorney Max Cauthen is prosecuting the Cobb case.
The cases are being prosecuted as part of the joint federal, state, and local 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.
Tuscaloosa Man Sentenced to 72 Monts in Prison for Illegal Possession of a Machine GunRead the Press Release
BIRMINGHAM, Ala. – A federal judge this week sentenced a Tuscaloosa man for being a felon in possession of a machine gun, 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 Devontay Jerrod Hutt, 25, to 72 months in prison for being a felon in possession of a firearm and 72 months in prison for possessing a machine gun. Each count to be served concurrently with each other. Hutt pleaded guilty to these charges in January.
According to court documents, on December 31, 2019, Hutt had an encounter with Tuscaloosa police officers at a restaurant in Tuscaloosa. Officers received a tip that Hutt possessed a firearm. When officers arrived at the restaurant, Hutt and another individual fled, eluding officers during a foot chase. Inspecting Hutt’s vehicle from the outside, officers could see two pistols and suspected drugs in plain view in the front seat. Officers searched the car and recovered a pistol that qualified as a machine gun, a second AR-style pistol, high capacity magazines, pills, and marijuana.
“Prosecuting felons who illegally possess weapons is a priority of my office,” U.S. Attorney Escalona said. “We commend the Tuscaloosa Police Department on their work to prevent violent crime and for the quick actions of the officers in this case.”
“Removing the criminal element that used a firearm to facilitate violent crimes is a priority of ATF,” SAC French stated. “ATF’s partnerships leveraged NIBIN technology that will have a lasting impact on the community.”
The ATF along with the Tuscaloosa Police Department investigated the case, which Assistant U.S. Attorney Alan Baty prosecuted.
Tungsten Heavy Powder of San Diego Agrees to Pay $5.6 Million to Settle False Claims Act AllegationsRead the Press Release
Assistant U. S. Attorneys Joseph Purcell (619) 546-7643 and Paul Starita (619) 546-7701
NEWS RELEASE SUMMARY – April 29, 2021
SAN DIEGO – Tungsten Heavy Powder, Inc. (THP) has agreed to pay $5,641,114 to resolve allegations that it violated the False Claims Act by falsely certifying that it sourced product materials in the United States for items it manufactured under a contract with the government of Israel that was funded by the U.S. Defense Security Cooperation Agreement Agency (DSCA). THP is a San Diego-based company that manufactures and supplies tungsten products, including those used in U.S. military applications and munitions. THP provided weapons systems manufacturing articles and services to United States Department of Defense agencies and to the Government of Israel.
The United States contended that THP knowingly submitted false certifications to the United States regarding the origin and manufacture of defense articles procured by the government of Israel that were financed with United States’ grant funds paid by the Foreign Military Financing (FMF) program through the DSCA. Specifically, it is alleged that THP submitted false certifications pertaining to seven government of Israel purchase orders. With respect to these procurements, the United States alleged that THP falsely certified that tungsten that was actually sourced in China had been sourced, instead, in the United States. The United States contended that THP also falsely certified that manufacturing occurred in the United States, when in fact THP contracted with a Mexican maquiladora.
In order to promote American manufacturing, grant funds for foreign procurements are only available when the materials are sourced and manufactured in the United States by domestic companies.
“As always, we are committed to preserving the integrity of the government contracting process and to ensuring that funds fraudulently obtained are returned to the public fisc,” said Randy S. Grossman, Acting United States Attorney for the Southern District of California. Grossman praised Assistant U.S. Attorneys Paul Starita and Joseph Purcell for their excellent work on this case.
Defense Criminal Investigative Service (DCIS) Special Agent in Charge Bryan Denny, Western Field Office, stated “The DCIS is committed to working with our law enforcement partners and the Department of Justice to combat those who attempt to take advantage of the military’s procurement system. Each instance of fraud or corruption has the potential to harm the military’s mission or those who serve, and needlessly wastes taxpayer money.”
The False Claims Act allegations being resolved were originally brought in a lawsuit filed by a former employee of THP, Gregory Caputo, and Global Tungsten & Powders Corporation under the qui tam, or whistleblower, provisions of the False Claims Act, which allow private citizens with knowledge of fraud against the government to bring suit on behalf of the government and to share in any recovery. Mr. Caputo and Global Tungsten & Powders Corporation will receive seventeen percent of the settlement proceeds.
This case is captioned United States, ex rel. Gregory Caputo and Global Tungsten & Powders Corporation v. Tungsten Heavy Powder, Inc., d/b/a Tungsten Heavy Powder & Parts, Inc., Case No. 18-cv-2352-W (WVG). This matter was investigated by Assistant U.S. Attorneys Joseph Purcell and Paul Starita of the Affirmative Civil Enforcement Unit of the U.S. Attorney’s Office, in coordination with Special Agents of the Defense Criminal Investigative Service and U.S. Army Criminal Investigation Division Command, and personnel from the Defense Security Cooperation Agency.
Defendant
Tungsten Heavy Powder, Inc. San Diego, CA
Agencies
Defense Criminal Investigative Service
U.S. Army Criminal Investigation Division Command
Defense Security Cooperation Agency
Tucker County woman sentenced for her role in a methamphetamine distribution operationRead the Press Release
ELKINS, WEST VIRGINIA – Donna Alyce Boyles, of Parsons, West Virginia, was sentenced today to five years of probation for her role in a methamphetamine distribution operation, Acting U.S. Attorney Randolph J. Bernard announced.
Boyles, age 54, pled guilty to one count of “Aiding and Abetting Maintaining Drug-Involved Premises” in February 2019. She admitted to maintaining a residence located at 128 Main Street in Parsons, West Virginia, to manufacture, sell or use methamphetamine.
Assistant U.S. Attorney Brandon S. Flower prosecuted the case on behalf of the government. The Mountain Region Drug & Violent Crimes Task Force investigated.
U.S. District Judge Thomas S. Kleeh presided.
Three Additional Individuals Admit Participating in $10 Million Multi-State Bank Fraud ConspiracyRead the Press Release
TRENTON, N.J. – A New York woman, an Ohio man, and a New Jersey man admitted their roles in a large-scale conspiracy to commit bank fraud in states including New Jersey, New York, Pennsylvania, Maryland, Virginia, and Michigan, Acting Attorney Rachael A. Honig announced today.
Erm Ayaz, 36, of Bayside, Brooklyn, pleaded guilty today by videoconference before Chief Judge Freda L. Wolfson to an information charging her with one count of conspiracy to commit bank fraud. Syed Abbas, 32, of Westerville, Ohio, and Habib Majid, 35, of North Brunswick, New Jersey, pleaded guilty before Chief Judge Wolfson on April 27, 2021, and April 21, 2021, respectively, to informations that charged them each with one count of conspiracy to commit bank fraud.
Ayaz, Abbas, and Majid are among seven individuals that have pleaded guilty as part of the scheme.
According to documents filed in this case and statements made in court:
From 2018 through April 2020, Ayaz, Majid, Abbas, and others conspired to defraud several major banks and electronic merchant processors. They established bank accounts associated with sham entities that had no legitimate purpose and issued checks payable to other shell companies associated with the criminal organization, knowing that the payor accounts had insufficient funds. The conspirators also conducted numerous fraudulent credit card and debit card transactions between shell companies to credit payee accounts and fraudulently overdraw payor accounts. Members of the conspiracy also used these shell companies to execute temporary refund credits, commonly referred to as “charge-backs,” to checking accounts associated with the criminal organization, where no prior legitimate transaction had occurred.
Members of the criminal organization withdrew the “existing” funds (through ATMs or bank tellers) that banks and/or merchant processors had credited to the payee bank accounts at the time of the fraudulent transaction. Because the conspirators withdrew the credited funds from the payee accounts before the banks could recognize the fraudulent transactions, the banks and merchant processors were left with substantial losses.
The investigation revealed that Ayaz, Majid, Abbas, and other conspirators attempted to defraud financial institutions and merchant processors of approximately $10 million dollars and did in fact cause a loss of approximately $3.5 million.
The conspiracy charges which Ayaz, Abbas, and Majid pleaded guilty carry a maximum potential penalty of 30 years in prison, a fine of $1 million or twice the gross gain to the defendants or loss to others, whichever is greater. Ayaz’s sentencing is scheduled for Sept. 14, 2021. Abbas’ and Majid’s sentencings are scheduled for Sept. 9, 2021.
Four co-defendants – Awaise Dar, Rana Sharif, Naveed Arif, Ali Abbas – have previously pleaded guilty to informations charging them with conspiracy to commit bank fraud in connection with the scheme.
Acting U.S. Attorney Honig credited inspectors of the U.S. Postal Inspection Service, under the direction of Acting Inspector in Charge Rodney M. Hopkins in Newark; special agents of the Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Jason J. Molina in Newark; the Social Security Administration Office of Inspector General, under the direction of John F. Grasso; and special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez, with the investigation leading to the guilty pleas.
The government is represented by Assistant U.S. Attorney Ray Mateo of the U.S. Attorney’s Office, Opioid Abuse Prevention and Enforcement Unit in Newark.
Texas Man Arrested and Charged with Sex Trafficking of A MinorRead the Press Release
Tampa, Florida – Acting United States Attorney Karin Hoppmann announces the filing of a criminal complaint charging Jamel Muldrew (32, Houston, TX) with sex trafficking of a minor, interstate transportation of a person to engage in prostitution, and enticement of a person to travel interstate for prostitution. If convicted on all counts, Muldrew faces a maximum penalty of life in federal prison.
According to the complaint, on or about April 9, 2021, law enforcement coordinated an operation in Tampa to identify and rescue victims of human trafficking, and to identify and arrest their traffickers. As part of this operation, an undercover officer arranged to engage in prostitution with a minor victim at a local hotel in exchange for $800. A male, later identified as Muldrew, then drove the minor victim to the hotel, dropped her off, and drove to nearby mall parking lot to wait. After being dropped off, the minor victim entered the hotel room where she was met by detectives. Law enforcement officers arrested Muldrew at the mall parking lot and searched him, recovering multiple fictious identity documents for both himself and the minor victim.
Subsequent investigation revealed that, from February until April 2021, Muldrew had trafficked the minor victim across the country to engage in prostitution, including in Texas, New Jersey, Maryland, North Carolina, Georgia, and ultimately Florida, where he was arrested.
A complaint is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by Homeland Security Investigations, the Hillsborough County Sheriff’s Office, and the Houston (Texas) Police Department. It will be prosecuted by Assistant United States Attorney Ilyssa M. Spergel.
Anyone who is or who knows a potential victim in this or any other case of sex trafficking or human trafficking, or who has any information regarding this or any other investigation, should contact Homeland Security Investigations toll-free Tip Line at 1-866-DHS-2423 or by completing its online tip form found at https://www.ice.gov/webform/ice-tip-form.
This case was brought as part of the Tampa Bay Human Trafficking Task Force of the Middle District of Florida, one of 13 such task forces in the country to receive grant funding from the Department of Justice’s Bureau of Justice Assistance. The Task Force is a collaboration of local, state, and federal law enforcement agents working together with organizations to detect, investigate, and prosecute human trafficking in the Tampa Bay area. This includes trafficking of minors, forced labor, transnational sex trafficking, and sex trafficking of adults by force, fraud, or coercion. More information about the Tampa Bay Human Trafficking Task Force can be found at www.justice.gov/usao-mdfl/humantrafficking. Information on the Department of Justice’s efforts to combat human trafficking can be found at www.justice.gov/humantrafficking.
Ten Members and Associates of ‘Uptop’ Street Gang Charged in Drug Trafficking ConspiracyRead the Press Release
NEWARK, N.J. – Ten people have been charged for their roles as members and associates of “UpTop,” a Paterson, New Jersey-based street gang involved in the distribution of drugs, including heroin, fentanyl, and cocaine base, Acting U.S. Attorney Rachael A. Honig announced today.
Corey Boyd, 23; Leo Edwards, 27; Kwame Ellis, 30; Sean Morgan, 21; and Brent Staton, 20; and Kassan Drakeford, 31; all of Paterson; and Stefan Cameron, 25, of Hackensack, New Jersey, are charged by complaint with one count of conspiracy to distribute heroin, fentanyl and cocaine base. Six of the defendants were arrested this morning and are scheduled to appear this afternoon by videoconference before U.S. Magistrate Judge Mark Falk. Ellis remains at large.
Also charged in the same complaint, and already in state custody on other charges, are Devin Kyle, 21; Edwin Diaz, 19; and Anthony Herring, 38, all of Paterson. They will have their initial appearances on a date to be determined.
According to the documents filed in this case and statements made in court:
The defendants are all members and associates of the UpTop street gang, which operates primarily in the Fourth Ward of Paterson. Through numerous controlled purchases of drugs, consensually recorded telephone calls and text messages, physical surveillance, and the analysis of telephone records, the investigation uncovered evidence that from January 2020 through April 29, 2021, the defendants conspired to distribute heroin, fentanyl and cocaine base.
UpTop derived its name from its location; its turf is colloquially described as being "up the hill" in the Fourth Ward of Paterson. Members of UpTop sell heroin that is frequently mixed with fentanyl, a potent, synthetic opioid that is approximately 50 times stronger than heroin.
Members and associates of UpTop sometimes compete with each other for narcotics customers within the gang's turf. However, the investigation has shown that UpTop members work together to ensure that outsiders are unable to distribute narcotics within the turf. Members and associates of UpTop work together to preserve and protect the power, territory, and reputation of the gang, and to hinder, obstruct, and prevent law enforcement officers from identifying their criminal activities, from apprehending offenders of the crimes, and from successfully prosecuting and punishing the offenders.
The count of conspiracy charged in the complaint carries a maximum penalty of 40 years in prison and a fine of at least $5 million, with a mandatory minimum prison sentence of five years.
Acting U.S. Attorney Honig credited special agents and task force officers with the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Acting Special Agent in Charge Craig B. Kailimai; special agents of the Drug Enforcement Administration, under the direction of Special Agent in Charge Susan A. Gibson; officers of the Paterson Police Department, under the direction of Police Director Jerry Speziale and Police Chief Ibrahim M. Baycora; detectives of the Passaic County Prosecutor’s Office, under the direction of Prosecutor Camelia Valdes; and the Passaic County Sheriff’s Department, under the direction of Sheriff Richard H. Berdnik, with the investigation leading to the charges. She also thanked the U.S. Marshals Service for their assistance with the case.
This case is being conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF). The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
The government is represented by Senior Trial Counsel Francesca Liquori and Special Assistant U.S. Attorney Kendall Randolph of the Organized Crime/Gangs Unit in Newark.
The charges and allegations contained in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Tax Collector Embezzled a Million Dollars from Township & School District, Filed a False Tax ReturnRead the Press Release
PITTSBURGH, PA - A Beaver County woman pleaded guilty in federal court to charges of wire fraud and filing false income tax returns, Acting United States Attorney Stephen R. Kaufman announced today.
Jeanne Bowser, 62, of Aliquippa, PA 15001 pleaded guilty to two counts before United States District Judge Robert Colville.
In connection with the guilty plea, the court was advised that Bowser was the elected tax collector for Center Township, Beaver, Pennsylvania and also collected taxes for Central Valley School District. From approximately December 2011 until approximately August 2019, Bowser embezzled $1,028,183.81 in tax payments from both the township and school district. She embezzled the funds by writing checks to herself out of a bank account that was used for tax deposits and by stealing cash tax payments. In addition to the embezzlement, the Court was further advised that Bowser filed a false income tax return for 2016 by underreporting her income.
Judge Colville scheduled sentencing for Sept. 28, 2021 at 9 a.m. The law provides for a total sentence of 23 years in prison, a fine of $500,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Pending sentencing, the court released Goodwin on a $25,000 bond.
Assistant United States Attorney Lee J. Karl is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation and Internal Revenue Service - Criminal Investigation conducted the investigation that led to the prosecution of Bowser.
Tarrant County Man Convicted at Trial of Child Exploitation ViolationsRead the Press Release
SHERMAN, Texas – A Kennedale man was found guilty by a jury of federal child exploitation violations in the Eastern District of Texas, announced Acting U.S. Attorney Nicholas J. Ganjei today.
Robert Allen Hall, 31, was found guilty of attempted coercion and enticement of a minor today by a jury following a three-day trial before U.S. District Judge Amos L. Mazzant, III.
“While sexual predators are actively looking for their child victims, we are also actively looking for those predators,” said Acting U.S. Attorney Nicholas J. Ganjei. “Our law enforcement officers, federal agents, and prosecutors are dedicated to keeping the Eastern District of Texas safe from those who seek to destroy our greatest resource, our children.”
According to the court documents and testimony at trial, Hall reached out to and communicated with an individual he believed to be a 14-year-old child via a social media application. The two chatted between Feb 5, 2019 and May 21, 2019. These chats were sexually charged and contained graphic descriptions of the sex acts Hall wanted to perform on the minor child. On May 21, 2019, Hall traveled from Kennedale to a location in Collin County to meet the child.
A federal grand jury returned an indictment charging Hall with federal violations on June 12, 2019. Under federal statutes, Hall faces up to life in federal prison. The maximum statutory sentence prescribed by Congress is provided here for information purposes, as the sentencing will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the U.S. Probation Office.
This case is part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Child Exploitation and Obscenity Section (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.
This case was investigated by the Plano Police Department and the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorneys Marisa Miller and Lesley Brooks.
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Stoughton Man Charged with Illegal Possession of FirearmsRead the Press Release
BOSTON – A Stoughton man was arrested yesterday and charged with illegal possession of firearms.
Michael Robert Moura, 27, was charged by criminal complaint with one count of possession of a firearm by a prohibited person. Following an initial appearance before Magistrate Judge Marianne B. Bowler in federal court in Boston, Moura was detained pending a detention hearing set for May 3, 2021.
As alleged in charging documents, due to an April 2020 conviction in Worcester County punishable by more than one year in prison, Moura is prohibited from possessing firearms and ammunition. Despite this prohibition, Moura endeavored to purchase a firearm over several months in 2020, and again in February 2021. On the morning of April 28, 2021, Moura succeeded. He purchased a Glock handgun, an assault rifle, pistol and rifle magazines, and over 100 rounds of ammunition in a parking lot in Brockton. Moura was arrested by federal agents and the handgun, rifle, ammunition, and magazines were seized.
The charging statute provides for a sentence of up to 10 years in prison, three years of supervised release and a $250,000 fine. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney Nathaniel R. Mendell and Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division made the announcement today. The case is being investigated by the FBI’s Joint Terrorism Task Force (JTTF), in cooperation with the Bureau of Alcohol, Tobacco, Firearms and Explosives, New England Field Division and the Brockton and Stoughton Police Departments. Assistant U.S. Attorney Benjamin Tolkoff of Mendell’s National Security Unit is prosecuting the case.
The details contained in the charging documents are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Sparta Man Pleads Guilty to Receiving Child PornographyRead the Press Release
Sparta, Ill. – Kory R. Schulein (37), of Sparta, Illinois, pleaded guilty today to knowingly receiving child pornography over the internet. A federal grand jury returned the single-count indictment against Schulein last October.
Schulein first came to the attention of law enforcement in 2018 during an FBI investigation of child pornography on the dark web. Agents were able to track his IP address and executed a federal search warrant at his home on Oct. 1, 2019.The National Center for Missing and Exploited Children confirmed the identities of children depicted in over 2,500 images and 100 videos found on Schulein’s laptop computer and two external hard drives. According to court documents, Schulein downloaded the child pornography from 2016 to
2019.At the conclusion of today’s plea hearing, Schulein was remanded into federal custody pending his sentencing hearing, which is set for Aug. 11, 2021, at 1:30 p.m. at the federal courthouse in East
St. Louis. He faces 5-20 years in prison on the charge. His sentence will be determined by United
States District Judge Stephen P. McGlynn after consideration of the federal sentencing guidelines and other statutory factors.The investigation was conducted by FBI-Springfield, with assistance from the United States Marshals
Service.The case is being prosecuted by Assistant U.S. Attorney Nathan D. Stump and Trial Attorneys Jessica
Urban and Alicia Bove with the Justice Department’s Child Exploitation and Obscenity Section.Southern Ohio woman charged with embezzling more than $700k from employerRead the Press Release
CINCINNATI – A federal grand jury has charged a Sardinia, Ohio, woman with stealing more than $700,000 from the family-owned business for which she worked.
Tina Coday-Townes, 48, was arrested by federal agents today and appeared in federal court in Cincinnati at 1:30pm. Her case was unsealed at her initial appearance.
According to court documents, Coday-Townes previously served as the office manager for Custom Built Crates in Clermont County. In that role, the defendant was responsible for accounts payable and bookkeeping, including inputting and sending data to a third-party payroll company.
The indictment alleges that from 2013 until 2019, Coday-Townes wrote checks using an employers’ signature stamp from Custom Built Crates’ operating accounts to pay off her personal credit cards. She also allegedly made false entries into the accounting database, indicating the checks were to vendors rather than to her personal credit cards.
Coday-Townes also allegedly entered overtime hours for herself, even though she was ineligible for overtime as a salaried employee.
In total, it is alleged the defendant stole $700,666.21 from her employee over the course of six years.
Coday-Townes is charged with wire fraud, a federal crime punishable by up to 20 years in prison, and aggravated identity theft, which carries an additional mandatory sentence of two years in prison.
Vipal J. Patel, Acting United States Attorney for the Southern District of Ohio, and Chris Hoffman, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Division, announced the charges. Assistant United States Attorney Ashley N. Brucato is representing the United States in this case.
An indictment is merely an allegation, and all defendants are presumed innocent unless proven guilty in a court of law.
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Serial Fraudster Sentenced to Four Years in Federal Prison for Conspiracy to Commit Bank Fraud and Aggravated Identity TheftRead the Press Release
Baltimore, Maryland – U.S. District Judge George L. Russell III sentenced Boaz Salmon Bratton-Bey, age 38, of Owings Mills, Maryland, to four years in federal prison, followed by three years of supervised release, for federal bank fraud conspiracy and aggravated identity theft charges. Judge Russell ordered that the first year of supervised release must be spent in a half-way house or residential reentry program. During the time Bratton-Bey was perpetrating these fraud schemes, he was on supervised release from a previous federal fraud conviction.
The sentence was announced by Acting United States Attorney for the District of Maryland Jonathan F. Lenzner; Chief Melissa R. Hyatt of the Baltimore County Police Department; and Postal Inspector in Charge Peter R. Rendina of the U.S. Postal Inspection Service - Washington Division.
According to his guilty plea, Bratton-Bey and his co-conspirators committed numerous acts of bank fraud using the stolen personal identifying information (“PII”) of individual victims, without the victims’ knowledge or permission.
Specifically, on June 5, 2019, Bratton-Bey and his co-conspirators executed an “instant credit” scheme in which a co-conspirator, Terrell Meadows, used a fictitious driver’s license bearing the image of Meadows and the personal information of an individual victim to obtain a store credit card at a home improvement store. The credit application contained the name, date of birth, Social Security Number, and other personally identifying information (PII) of a real person who did not consent to the use of his PII. The credit application was approved and a credit card with a $12,000 line of credit was issued in temporary form instantaneously. Transaction records indicate that on June 5 and June 6, 2019, the account was used to make a total of four purchases at four different store locations totaling in $5,988.14. Bratton-Bey and Meadows used a U-Haul truck to load and carry away the fraudulently obtained goods.
After one month of the truck rental, Bratton-Bey failed to provide payment and return the U-Haul truck, which caused the truck to be reported as stolen. During a traffic stop, The Baltimore County Police located the truck, identified the driver as Bratton-Bey, and retrieved fraudulently obtained14 credit cards featuring 14 different names of real individuals.
Following the seizure of those credit cards, investigators obtained bank records from financial institutions which showed that these cards had been used to commit fraudulent transactions, totaling at least $6,822.03 in actual fraud and at least $1,046.85 in attempted fraud. Records obtained from U-Haul revealed that Bratton-Bey paid a total of $4,039.91 for the rental of the U-Haul truck using fraudulent credit cards issued to real persons. The total loss amount from the U-Haul rental and the cards recovered from Bratton-Bey following the traffic stop was $12,652.73.
According to his plea agreement, investigators executed a search warrant at Bratton-Bey’s apartment on July 25, 2019. During the course of the search warrant, Law enforcement located counterfeit identification documents bearing photographs of Bratton-Bey and other individuals, credit/debit cards issued to individuals or entities other than Bratton-Bey, mail and financial correspondence addressed to individuals other than Bratton-Bey, and several cell phones and other electronic devices. Investigators recovered at least 12 credit/debit cards issued to individuals other than Bratton-Bey. Investigators also found Bratton-Bey’s real driver’s license, along with a fictitious driver’s license that included Bratton-Bey’s picture and his alias, “Boa Salmon” and a fictitious social security card for the “Boa Salmon” alias. The items recovered from Bratton-Bey’s apartment also included four other counterfeit identifications in the form of fictitious driver’s licenses bearing the PII of real victims, including counterfeit driver’s licenses for Pennsylvania and New York, in addition to Maryland. The total loss amount from the accounts related to the cards recovered from Bratton-Bey’s apartment was $40,222.30.
Judge Russell previously sentenced conspirator Terrell Meadows, age 32, of Rosedale, Maryland, to six months in prison, followed by three years of supervised release, for his role in the bank fraud conspiracy.
Bratton-Bey was previously convicted in U.S. District Court in Maryland for bank fraud conspiracy, access device fraud, and aggravated identity theft. For that case, he was sentenced to 102 months in federal prison in July 2012.
Acting United States Attorney Jonathan F. Lenzner praised the Baltimore County Police Department and the U.S. Postal Inspection Service for their work in the investigation. Mr. Lenzner thanked Assistant U.S. Attorneys Daniel A. Loveland, Jr. and Tamera Fine, who prosecuted the case.
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Second rapper scammer sentenced to prison for conspiracy that cheated hotels, studios, limo servicesRead the Press Release
AUGUSTA, GA: An Augusta man has been sentenced to more than eight years in federal prison for his role in a scheme to steal hospitality services by claiming to be part of a famed rap group.
Walker Washington, 53, of Augusta, was sentenced to 100 months in prison by U.S. District Court Judge Dudley H. Bowen after pleading guilty to Conspiracy to Commit Wire Fraud, said David H. Estes, Acting U.S. Attorney for the Southern District of Georgia. Washington also was ordered to pay nearly $300,000 to 19 businesses defrauded in the scheme, and must serve three years of supervised release after completion of his prison term. There is no parole in the federal system.
Co-defendant Aaron Barnes-Burpo, 29, of Crestview, Fla., previously was sentenced to 84 months in prison after also pleading guilty, and also must pay restitution to the businesses victimized in the scheme.
“These two flim-flam artists and their phony entourage lived large for several weeks by scamming hospitality providers,” said Acting U.S. Attorney Estes. “We commend the skeptical hotel clerk who saw through the scam and alerted law enforcement, bringing this scheme to a halt.”
In court documents and testimony, Washington and Barnes-Burpo admitted that they falsely portrayed themselves as affiliated with the Roc Nation production company and the hip-hop group Wu-Tang Clan as early as September 2019, and used those fictitious representations along with fraudulent and stolen credit cards to rent luxury limousines and defraud hotels, caterers and production studios of thousands of dollars in goods and services in multiple cities, primarily in the Southeast.
The scam unraveled Nov. 21, 2019, when staff at the Fairfield Inn and Suites in Augusta became suspicious and alerted the FBI and the Richmond County Sheriff’s Office.
“These two scammers will have plenty of time to figure out if their few weeks of unearned fame was worth several years in prison,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “With this sentence, law enforcement and the victims of their scam, have spoken loudly that we won’t tolerate anyone who takes anything they do not earn or deserve.”
The case was investigated by the FBI and other state and local authorities, and prosecuted for the United States by Assistant U.S. Attorney Patricia G. Rhodes.
San Marino Man Who Drove Truck into Protesters Agrees to Plead Guilty to Illegally Obtaining, Transporting and Possessing FirearmsRead the Press Release
LOS ANGELES – A San Gabriel Valley man who drove his truck into a crowd of peaceful demonstrators last year in Pasadena has agreed to plead guilty to a series of federal firearms offenses, including illegally obtaining and transporting weapons, and possessing short-barreled rifles.
Benjamin Jong Ren Hung, 28, a San Marino resident who also has a home in Lodi, entered into a plea agreement with prosecutors that was filed today in United States District Court. Hung agreed to plead guilty to 11 felony offenses – including conspiracy, transporting and receiving firearms across state lines, making false statements during purchases of firearms, and possession of unregistered firearms – charged in a superseding information that was also filed today.
Hung admitted to participating in a multi-year conspiracy to make false statements to firearms dealers in Oregon and to illegally transport those firearms to California. Hung provided cash to a co-conspirator in Oregon to buy handguns for Hung and to falsely state that the co-conspirator was the actual buyer, rather than Hung. The co-conspirator then delivered the firearms to Hung in California. In his plea agreement, Hung admitted that he engaged in the scheme to obtain the firearms and “evade California’s firearms registration laws.”
Hung also admitted to making false statements to firearms dealers in Washington in connection with his purchase of four rifles and one shotgun in March 2020. When he purchased the firearms, Hung falsely attested that he was a resident of Washington, rather than California, which was material because, as Hung admitted in the plea agreement, “the firearms dealers were not legally permitted to sell firearms to California residents.” Hung also agreed to plead guilty to illegally transporting those firearms to California.
Hung further admitted he illegally possessed three unregistered short-barreled semiautomatic rifles, which authorities seized from his residence in Lodi in September 2020.
In the plea agreement, Hung admitted bringing one of his illegally obtained firearms, a Glock 26 9mm handgun, to counterprotest in Old Town Pasadena against a group who had gathered on May 31, 2020, to protest against inequitable treatment of minorities by police, including the death of George Floyd at the hands of a police officer in Minneapolis. Hung, who was driving a customized Dodge pickup truck with vanity license plates reading “WAR R1G,” accelerated toward an intersection where the protest was taking place, sounded a train horn installed on the truck, came to a stop, and then continued through the intersection. As he drove past the demonstrators, Hung caused the truck to emit a large amount of exhaust in what is sometimes called “coal rolling.” No protesters were injured during the incident.
Hung was detained by local police following his confrontation with the demonstrators, and the FBI then took over the investigation.
A date for Hung to appear in court to formally enter the guilty pleas has not yet been set.
This matter was investigated by the FBI’s Los Angeles Joint Terrorism Task Force, FBI civil rights squads and the Pasadena Police Department.
This case is being prosecuted by Assistant United States Attorneys Frances S. Lewis of the Public Corruption and Civil Rights Section, and David T. Ryan of the Terrorism and Export Crimes Section.
Salvadoran National Sentenced to 20 Years in Federal Prison for Distributing Child Pornography, Failing to Register as Sex OffenderRead the Press Release
SANTA ANA, California – A Salvadoran national – who was previously deported after being convicted of sexually abusing a minor – was sentenced today to 240 months in federal prison for distributing child pornography on Facebook’s Messenger after he illegally reentered the United States.
Jose Ramon Aguilar-Moreno, 52, of Fontana, was sentenced by United States District Judge David O. Carter.
Aguilar-Moreno pleaded guilty in July 2020 to one count of distribution of child pornography and one count of failure to register as a sex offender.
In August 2002, Aguilar-Moreno was convicted in San Bernardino County Superior Court of committing lewd and lascivious acts on a minor. Following his deportation in June 2003, he unlawfully returned to the United States in 2016. Since that time, he failed to register as a sex offender in California or anywhere else in the United States, which was required because of his 2002 conviction.
In June 2018, Aguilar-Moreno used the name “Abel Aguilar” on the Messenger application to distribute three videos that depicted minors engaged in sexually explicit conduct.
Law enforcement in June 2019 executed a search warrant at Aguilar-Moreno’s residence – which was across the street from an elementary school – and discovered over 900 still image and more than 1,200 videos of child pornography on his cell phones. Aguilar-Moreno’s child pornography “collection spans the gamut and is documentation of some of the most demeaning abuse inflicted on victims of child pornography,” prosecutors wrote in a sentencing memo filed with the court.
In the sentencing memo, prosecutors noted that Aguilar-Moreno also used WhatsApp to welcome individuals to “the world of child pornography” as he solicited the exchange of images and videos. Aguilar-Moreno chatted with individuals in at least 14 countries, meaning “His reach and impact truly was global,” prosecutors wrote.
In addition to the prison sentence, Judge Carter ordered Aguilar-Moreno to pay $60,000 in restitution to the victims depicted in the child pornography in this case.
Homeland Security Investigations and the United States Marshals Service investigated this matter.
Assistant United States Attorney Eli A. Alcaraz of the Riverside Branch Office prosecuted this case.
SAP Admits to Thousands of Illegal Exports of its Software Products to Iran and Enters into Non-Prosecution Agreement with DOJRead the Press Release
Note: A full copy of the non-prosecution agreement can be viewed
here.To learn more about what the Justice Department is doing to deter and hold to account those who violate export controls and sanctions laws, visit www.justice.gov/nsd. A full copy of the Voluntary Self Disclosure (VSD) Policy can be found here.
WASHINGTON – Software company, SAP SE, headquartered in Walldorf, Germany, has agreed to pay combined penalties of more than $8 million as part of a global resolution with the U.S. Departments of Justice (DOJ), Commerce and Treasury. In voluntary disclosures the company made to the three agencies, SAP acknowledged violations of the Export Administration Regulations and the Iranian Transactions and Sanctions Regulations. As a result of its voluntary disclosure to DOJ, extensive cooperation and strong remediation costing more than $27 million, DOJ’s National Security Division (NSD) and the U.S. Attorney’s Office for the District of Massachusetts entered into a Non-Prosecution Agreement with SAP. Pursuant to that agreement, SAP will disgorge $5.14 million of ill-gotten gain.
“Today’s first-ever resolution pursuant to the Department’s Export Control and Sanctions Enforcement Policy for Business Organizations sends a strong message that businesses must abide by export control and sanctions laws, but that when they violate those laws, there is a clear benefit to coming to the Department before they get caught,” said Assistant Attorney General John C. Demers for the Justice Department’s National Security Division. “SAP will suffer the penalties for its violations of the Iran sanctions, but these would have been far worse had they not disclosed, cooperated, and remediated. We hope that other businesses, software or otherwise, we heed this lesson.”
“Today, SAP has admitted to thousands of export violations spanning six years that violated the U.S. embargo against Iran and endangered the national security of the United States,” said Acting U.S. Attorney Nathaniel Mendell for the District of Massachusetts. “This settlement should serve as a strong deterrent message to others that the release of software and sale of product and services on the internet are subject to U.S. export laws and regulations.”
“This action demonstrates that the Office of Export Enforcement will continue to leverage our unique authorities to enforce our nation’s export control laws and to deter new violations. Violators of the EAR will be held accountable through criminal or civil penalties, or both when appropriate,” said Special Agent in Charge William Higgins for the Commerce Department’s Office of Export Enforcement, Boston Field Office. “These laws are designed to protect U.S. Foreign Policy and National Security and will be vigorously investigated.”
“By supplying Iran with millions of dollars’ worth of illegally exported software and services, SAP circumvented U.S. economic sanctions against Iran—pressure that is intended to end Iran’s malign behavior. However, it was SAP that first uncovered and reported this sanctions violation, and we would like to thank them for working hard to enhance their compliance program to prevent future violations,” said Special Agent in Charge Joseph R. Bonavolonta for the FBI’s Boston Division. “Let this case be a lesson to others that it’s better to self-report and own up to one’s mistakes than undermine U.S. foreign policy and adversely affect our national security.”
“Among HSI’s priorities is the commitment to ensuring that sensitive U.S. products, to include software, are not illegally exported to embargoed destinations, such as Iran,” said Acting Special Agent in Charge William S. Walker for Homeland Security Investigations, Boston. “It will continue to be incumbent upon U.S. companies to guarantee that foreign subsidiaries dealing in their products remain in compliance with U.S. sanctions and export control regulations. HSI will continue to coordinate with our law enforcement partners to safeguard sensitive technologies produced in the United States from ending up in the hands of our adversaries.”
Beginning in approximately January 2010 through approximately September 2017, SAP, without a license, willfully exported, or caused the export, of its products to Iranian users. SAP’s violations occurred in two principle ways.
First, between 2010 and 2017, SAP and its overseas partners released U.S-origin software, including upgrades or software patches more than 20,000 times to users located in Iran. Certain SAP senior executives were aware that neither the company nor its U.S.-based content delivery provider used geolocation filters to identify and block Iranian downloads, yet for years the company did not remedy the issue. The vast majority of the Iranian downloads went to 14 companies, which SAP partners in Turkey, United Arab Emirates, Germany and Malaysia knew were Iranian-controlled front companies. The remaining downloads went to several multinational companies with operations in Iran, which downloaded SAP’s software, updates, or patches from locations in Iran.
Second, from approximately 2011 to 2017, SAP’s Cloud Business Group companies (CBGs) permitted approximately 2,360 Iranian users to access U.S.-based cloud services from Iran. Beginning in 2011, SAP acquired various CBGs and became aware, through pre-acquisition due diligence as well as post-acquisition export control-specific audits, that these companies lacked adequate export control and sanctions compliance processes. Yet, SAP made the decision to allow these companies to continue to operate as standalone entities after acquiring them and failed to fully integrate them into SAP’s more robust export controls and sanctions compliance program.
While this conduct constituted serious violations of U.S. law involving the release of U.S. origin technology and software through cloud servers and online portals, this Non-Prosecution Agreement recognizes the importance of voluntary self-disclosure and cooperation with the government. DOJ and the District of Massachusetts reached this resolution with SAP based upon its voluntary self-disclosure as well as SAP’s extensive internal investigation and cooperation over a three-year period. During this time, SAP worked with prosecutors and investigators, producing thousands of translated documents, answering inquiries and making foreign-based employees available for interviews in a mutually agreed upon overseas location. SAP also timely remediated and implemented significant changes to its export compliance and sanctions program, spending more than $27 million on such changes over the last four years, including, among other things detailed in the NPA: (1) implementing GeoIP blocking; (2) deactivating thousands of individuals users of SAP cloud based services based in Iran; (3) transitioning to automated sanctioned party screening of its CBGs; (4) auditing and suspending SAP partners that sold to Iran-affiliated customers; and (5) hiring of experienced U.S.-based export controls staff, and (6) conducting more robust due diligence at the acquisition stage by requiring new acquisitions to adopt GeoIP blocking and requiring involvement of the Export Control Team before acquisition.
Concurrently with this agreement, SAP is entering into administrative agreements with the Department of Commerce, Bureau of Industry and Security (BIS) and the Department of the Treasury, Office of Foreign Assets Control (OFAC). Among other things, the BIS settlement agreement requires SAP to conduct internal audits of its compliance with U.S. export control laws and regulations and produce audit reports to BIS for a period of three years.
The Department encourages companies to voluntarily self-disclose all potentially willful violations of the statutes implementing the U.S. government’s primary export control and sanctions regimes — the Arms Export Control Act (AECA), the Export Control Reform Act (ECRA), and the International Emergency Economic Powers Act (IEEPA), — directly to NSD. The VSD Policy, absent aggravating factors, creates a presumption in favor of a non-prosecution agreement and limits any monetary payment to an amount equal to the gains from the illegal conduct.
Deputy Chief of Export Controls and Sanctions Elizabeth Cannon and Senior Trial Attorney Heather Schmidt for NSD’s Counterintelligence and Export Controls Section, and Assistant U.S. Attorney B. Stephanie Siegmann, Chief of District of the Massachusetts’ National Security Unit oversaw the investigation and negotiated this agreement.
SAP Admits to Thousands of Illegal Exports of Its Software Products to Iran and Enters into Non-Prosecution Agreement with DOJRead the Press Release
BOSTON – SAP SE, a global software company headquartered in Waldorf, Germany, has agreed to pay combined penalties of more than $8 million as part of a global resolution with the Departments of Justice, Commerce, and the Treasury.
In voluntary disclosures the Company made to the three agencies, SAP acknowledged violations of the Export Administration Regulations and the Iranian Transactions and Sanctions Regulations. As a result of its voluntary disclosure to DOJ, extensive cooperation, and remediation costing more than $27 million, United States Attorney’s Office for the District of Massachusetts and DOJ’s National Security Division entered into a Non-Prosecution Agreement with SAP. Pursuant to that agreement, SAP will disgorge $5.14 million of ill-gotten gain.
Beginning in approximately January 2010 and continuing through approximately September 2017, SAP, without a license, willfully exported, or caused the export, of its products to Iranian users. SAP’s violations occurred in two principle ways.
First, between 2010 and 2017, SAP and its overseas partners released its U.S-origin software, including upgrades, and/or software patches more than 20,000 times to users located in Iran. SAP senior management was aware that neither the Company nor its U.S.-based Content Delivery Provider used geolocation filters to identify and block Iranian downloads, yet for years the Company did nothing to remedy the issue. The vast majority of the Iranian downloads went to 14 companies, which SAP Partners in Turkey, United Arab Emirates, Germany, and Malaysia knew were Iranian-controlled front companies. The remaining downloads went to several multinational companies with operations in Iran, which downloaded SAP’s software, updates, and/or patches from locations in Iran.
Second, from approximately 2011 to 2017, SAP’s Cloud Business Group companies (CBGs) permitted approximately 2,360 Iranian users to access U.S.-based cloud services from Iran. Beginning in 2011, SAP acquired various CBGs and became aware, through pre-acquisition due diligence as well as post-acquisition export control-specific audits, that these companies lacked adequate export control and sanctions compliance processes. Yet, SAP made the decision to allow these companies to continue to operate as standalone entities after acquiring them and failed to fully integrate them into SAP’s more robust export controls and sanctions compliance program.
While this conduct constituted serious violations of U.S. law involving the release of U.S. origin technology and software through cloud servers and online portals, this Non-Prosecution Agreement recognizes the importance of voluntary self-disclosure and cooperation with the government. DOJ and the District of Massachusetts reached this resolution with SAP based upon its voluntary self-disclosure as well as SAP’s extensive internal investigation and cooperation over a three-year period. During this time, SAP worked with prosecutors and investigators, producing thousands of translated documents, answering inquiries, and making foreign-based employees available for interviews in a mutually agreed upon overseas location. AP also timely remediated and implemented significant changes to its export compliance and sanctions program, spending more than $27 million on such changes, including, among other things detailed in the NPA: (1) implementing GeoIP blocking; (2) deactivating thousands of individuals users of SAP cloud based services based in Iran; (3) transitioning to automated sanctioned party screening of its CBGs; (4) auditing and suspending SAP partners that sold to Iran-affiliated customers; and (5) conducting more robust due diligence at the acquisition stage by requiring new acquisitions to adopt GeoIP blocking and requiring involvement of the Export Control Team before acquisition.
Concurrently with this agreement, SAP is entering into Administrative Agreements with the Department of Commerce, Bureau of Industry and Security (“BIS”) and the Department of the Treasury, Office of Foreign Assets Control (“OFAC”). Among other things, the BIS settlement agreement requires SAP to conduct internal audits of its compliance with U.S. export control laws and regulations, and produce audit reports to BIS for a period of three years.
“Today, SAP has admitted to thousands of export violations spanning six years that violated the U.S. embargo against Iran and endangered the national security of the United States,” said Acting U.S. Attorney Nathaniel Mendell. “This settlement should serve as a strong deterrent message to others that the release of software and sale of product and services on the internet are subject to U.S. export laws and regulations.”
“Today’s first-ever resolution pursuant to the Department’s Export Control and Sanctions Enforcement Policy for Business Organizations sends a strong message that businesses must abide by export control and sanctions laws, but that when they violate those laws, there is a clear benefit to coming to the Department before they get caught,” said Assistant Attorney General John C. Demers for the National Security Division. “SAP will suffer the penalties for its violations of the Iran sanctions, but these would have been far worse had they not disclosed, cooperated, and remediated. We hope that other businesses, software or otherwise, we heed this lesson.”
“This action demonstrates that the Office of Export Enforcement will continue to leverage our unique authorities to enforce our nation’s export control laws and to deter new violations. Violators of the EAR will be held accountable through criminal, civil penalties, or both when appropriate,” said William Higgins, Special Agent in Charge of the Department of Commerce’s Office of Export Enforcement, Boston Field Office. “These laws are designed to protect U.S. Foreign Policy and National Security and will be vigorously investigated.”
“By supplying Iran with millions of dollars’ worth of illegally exported software and services, SAP circumvented U.S. economic sanctions against Iran—pressure that is intended to end Iran’s malign behavior. However, it was SAP that first uncovered and reported this sanctions violation, and we would like to thank them for working hard to enhance their compliance program to prevent future violations,” said Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division. “Let this case be a lesson to others that it’s better to self-report and own up to one’s mistakes than undermine U.S. foreign policy and adversely affect our national security.”
“Among HSI’s priorities is the commitment to ensuring that sensitive U.S. products, to include software, are not illegally exported to embargoed destinations, such as Iran,” said William S. Walker, Acting Special Agent in Charge for Homeland Security Investigations, Boston. “It will continue to be incumbent upon U.S. companies to guarantee that foreign subsidiaries dealing in their products remain in compliance with U.S. sanctions and export control regulations. HSI will continue to coordinate with our law enforcement partners to safeguard sensitive technologies produced in the United States from ending up in the hands of our adversaries.”
Acting U.S. Attorney Mendell, Assistant Attorney General John Demers, SAC William Higgins, SAC Bonavolonta, and Acting SAC William Walker made the announcement today. Assistant U.S. Attorney B. Stephanie Siegmann, Chief of Mendell’s National Security Unit; Elizabeth Cannon, Deputy Chief of Export Controls and Sanctions, National Security Division; and Heather Schmidt, Senior Trial Attorney, National Security Division, oversaw this investigation and negotiated this agreement.
Rochester Man Pleads Guilty to Stealing Thousands of Dollars in SSI and SNAP BenefitsRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051ROCHESTER, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Mensur Odzakovic, 49, of Rochester, NY, pleaded guilty before Chief U.S. District Judge Frank P. Geraci to wire fraud. The charge carries a maximum penalty of 20 years prison and a fine of $250,000.
Assistant U.S. Attorney Kyle P. Rossi, who is handling the case, stated that between 2007 and March 2020, the defendant fraudulently collected Social Security Income (SSI) and Supplemental Nutrition Assistance Program (SNAP, formerly food stamp) benefits. The SSI and SNAP programs use federal tax money to assist low-income and disabled individuals by providing supplemental income and funds for the purchase of food, among other things. Odzakovic claimed in government applications that he was not employed and had no source of income in order to collect SSI and SNAP benefits. However, the defendant was continuously employed at a Rochester area restaurant earning cash wages. If reported, Odzakovic’s wages would have disqualified him from receiving SSI and SNAP benefits or would have reduced the amount of benefits that he could have received.
As a result, between 2007 and March 1, 2020, the defendant unlawfully collected $53,315.14 in SSI payments and $32,986.00 in SNAP benefits, for a total of $86,301.14.
The plea is the result of an investigation by the U.S. Department of Agriculture, Office of Inspector General, under the direction of Special Agent-in Charge Bethanne M. Dinkins; the Social Security Administration, Office of Inspector General, under the direction of Special Agent-in-Charge, John F. Grasso; and the Monroe County Department of Social Services, under the direction of Commissioner Corinda Crossdale.
Sentencing is scheduled for July 29, 2021, before Judge Geraci.
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Revere Man Sentenced for Money Laundering and Cocaine ChargesRead the Press Release
BOSTON – A Revere man was sentenced in federal court in Boston yesterday for cocaine possession and attempting to launder money to Colombia.
Jairo Agudelo, 34, was sentenced by U.S. District Court Judge Leo T. Sorokin to 57 months in prison and three years of supervised release. In December 2020, Agudelo pleaded guilty to money laundering conspiracy, substantive money laundering and possession with intent to distribute cocaine.
In February 2019, investigators seized approximately $200,000 in cash from Agudelo when he attempted to launder drug proceeds from Massachusetts to Colombia. When investigators executed a search warrant at a Revere apartment used by Agudelo as a stash house for his cocaine distribution, they located approximately 400 grams of cocaine, as well as drug packaging materials and over $11,000 in cash.
Acting United States Attorney Nathaniel R. Mendell; Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration, New England Field Division; and Ramsey E. Covington, Acting Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation Division made the announcement today. Critical assistance was provided by the Boston Police Department; Massachusetts State Police; Revere Police Department; U.S. Immigration and Customs Enforcement, Enforcement and Removal Operations; and the United States Marshals Service. Assistant U.S. Attorneys Lauren A. Graber and Jared C. Dolan of Mendell’s Narcotics and Money Laundering Unit prosecuted the case.
This investigation, dubbed “Operation Týr,” is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
Randolph County woman sentenced for methamphetamine chargeRead the Press Release
ELKINS, WEST VIRGINIA – Melissa Ann Slayton, of Elkins, West Virginia, was sentenced today to 100 months of incarceration for methamphetamine distribution, Acting U.S. Attorney Randolph J. Bernard announced.
Slayton, 36, pleaded guilty to one count of “Possession with Intent to Distribute More Than Five Grams of Methamphetamine” in October 2020. She admitted to having more than five grams of methamphetamine, also known as “crystal meth” and “ice,” in November 2019 in Randolph County.
Assistant U.S. Attorney Stephen D. Warner prosecuted the case on behalf of the government. The Mountain Region Drug & Violent Crimes Task Force investigated.
U.S. District Judge Thomas S. Kleeh presided.
Pass Christian Man pleads guilty to being a Felon in Possession of a FirearmRead the Press Release
Gulfport, Mississippi – A Pass Christian, Mississippi man pleaded guilty today to being a convicted felon in possession of a firearm, announced Acting U.S. Attorney Darren J. LaMarca and Special Agent in Charge Kurt Thielhorn with the Bureau of Alcohol, Tobacco, Firearms and Explosives.
According to court documents, Mason Charles Brown, 32, when encountered by law enforcement officers on November 10, 2020, knowingly possessed a firearm, and had previously been convicted of a crime which is punishable by imprisonment for a term exceeding one year.
Brown pleaded guilty to the one-count indictment alleging he was a previously convicted felon knowingly possessing a firearm. He is scheduled to be sentenced on July 29, 2021, and faces a maximum penalty of not more than 10 years in prison. If the Court deems Brown qualifies as an Armed Career Criminal, however, he faces a maximum penalty of not less than fifteen (15) years imprisonment to life. A federal district judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The Harrison County Sheriff’s Office Narcotics Division and The Bureau of Alcohol, Tobacco, Firearms and Explosives are investigating the case.
Assistant U.S. Attorney Andrea Jones is prosecuting the case.
Operation Second Wave Update: Huntington Man Sentenced to Federal Prison for Methamphetamine ConspiracyRead the Press Release
CHARLESTON, W.Va. – A Huntington man was sentenced to 36 months in federal prison for conspiracy to distribute methamphetamine. Jimmie Lee Coleman, 35, was prosecuted as part of “Operation Second Wave,” which dismantled a poly-drug network operating in Kanawha and Fayette counties.
According to court documents, Coleman admitted selling more than a 1.5 pounds of methamphetamine as part of his role in the organization.
Other defendants, including Carol Belton, Sammy Joe Fragale, Sr., Larry Martin, Rashawn Miller, and Jason Terrell have pleaded guilty and are awaiting sentencing. Gregory Woods was sentenced to 184 months in federal prison on February 8, 2021. Sammy Joe Fragale, II, was sentenced on January 6, 2021 to 42 months in federal prison. Steven Matthew Bumpus, Roger Jarea Drake, and Tonya Simerly are awaiting court dates to enter guilty pleas. Craig Redman and Ronald Lee Thomas III are scheduled for trial on June 1, 2021.
Acting United States Attorney Lisa G. Johnston made the announcement. Assistant United States Attorney Joshua C. Hanks handled the prosecution.
The Federal Bureau of Investigation (FBI), the Central West Virginia Drug Task Force (CWVDTF), the Kanawha County Sheriff’s Department, the Charleston Police Department, the United States Postal Inspection Service (USPIS) and the Metropolitan Drug Enforcement Network Team (MDENT) conducted the investigation with assistance from the Drug Enforcement Administration (DEA), who led the investigation of Sammy Joe Fragale, Sr., and Sammy Joe Fragale II, also prosecuted as part of the Second Wave investigation.
Senior United States District Judge David A. Faber imposed the sentence.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case Nos. 2:21-cr-00045 (Miller), 2:20-cr-00153 (Woods), and 2:20-cr-00154 (Terrell et al).
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O'Fallon Man Pleads Guilty to PPP Loan FraudRead the Press Release
O’Fallon, Ill. – Jason Spengler (45), of O’Fallon, Illinois, pleaded guilty today to one count of making a false statement on a federal loan application. According to court documents, Spengler committed the felony offense last year when he filed for assistance from the Paycheck
Protection Program (“PPP”) without disclosing that his business, Spengler Plumbing Company, was in bankruptcy.
The Coronavirus Aid, Relief, and Economic Security (“CARES”) Act was enacted in March 2020 to provide emergency financial assistance to Americans who were suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the federal PPP loan program. Administered by the Small Business Administration (SBA), the program provided loans to help qualifying businesses during the COVID-19 crisis.Debtors in bankruptcy were not eligible for PPP loans. The first question on the loan application asked, “Is the Applicant ... presently involved in any bankruptcy?” Above this question, the application explained that the loan would not be approved if the applicant answered
“Yes.”When Spengler applied for a PPP loan last year, Spengler Plumbing was in bankruptcy. But Spengler checked “No” on the application, falsely certifying to the lender and the SBA that Spengler
Plumbing was not in bankruptcy. Because of this false statement, Spengler Plumbing was awarded a
$487,095 PPP loan in April 2020.As a debtor in bankruptcy, Spengler Plumbing was also required by law to obtain prior authorization from the bankruptcy court before incurring any new unsecured debt. But Spengler applied for the government loan without notifying the bankruptcy judge, thereby evading the safeguards put in place by both the SBA and the bankruptcy court.
“Together with U.S. Attorney Steve Weinhoeft and our law enforcement partners, we will continue to pursue fraud and abuse in bankruptcy cases,” stated Nancy J. Gargula, U.S. Trustee for Region
10. The U.S. Trustee Program is the component of the Justice Department that protects the integrity of the bankruptcy system by overseeing case administration and litigating to enforce the bankruptcy laws. Region 10 is headquartered in Indianapolis, with additional offices in South Bend, Indiana, and Peoria, Illinois.Sentencing is set for August 18, 2021, at the federal courthouse in East. St. Louis. The charge carries a maximum sentence of five years in prison and a fine of up to $250,000.
This case was referred to the U.S. Attorney’s Office for prosecution by the U.S. Trustee for Region
10, in collaboration with the Southern District of Illinois Bankruptcy Fraud Working Group.
The investigation was conducted by the Small Business Administration – Office of the Inspector
General. The case is being prosecuted by Assistant United States Attorney Peter T. Reed.