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25 March 2021
Merrimack Man Sentenced to 24 Months for Fentanyl TraffickingRead the Press Release
CONCORD - Nicholas Snow, 26, of Merrimack, was sentenced to 24 months in federal prison for possession of fentanyl with intent to distribute, Acting United States Attorney John J. Farley announced today.
According to court documents and statements made in court, on February 1, 2020, Hudson patrol officers stopped a car in which Snow was a passenger. Both the driver and Snow had suspended licenses. An officer later determined that Snow was in possession of a pouch containing fentanyl, a scale, packaging materials, and $655 in cash. In his post-arrest interview, Snow admitted to drug distribution activities in Hudson. Snow’s cell phone also revealed communications about drug deals.
Snow previously pleaded guilty on December 14, 2020.
“Fentanyl traffickers are endangering our citizens by selling a potentially-lethal substance,” said Acting U.S. Attorney Farley. “In order to combat this menace, we are working closely with our law enforcement partners to identify and prosecute the drug dealers who are distributing fentanyl in the Granite State.”
This matter was investigated by the Hudson Police Department. The case was prosecuted by Assistant U.S. Attorney Joachim H. Barth.
This case is part of Operation Synthetic Opioid Surge (S.O.S.). In July of 2018, Attorney General Jeff Sessions announced the creation of S.O.S., which is being implemented in the District of New Hampshire and nine other federal districts. The goal of S.O.S. is to combat the large number of overdoses and deaths associated with fentanyl and other synthetic opioids. In New Hampshire, the U.S. Attorney’s Office is focusing its efforts on prosecuting synthetic opioid trafficking cases arising in Hillsborough County, which includes Manchester and Nashua.
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Maryland man indicted on drug and firearms chargesRead the Press Release
MARTINSBURG, WEST VIRGINIA – Antonio Cortez Darden, of Maugansville, Maryland, appeared today before a federal magistrate judge on drug and firearms charges after being indicted last week, Acting United States Attorney Randolph J. Bernard announced.
Darden, 43, was indicted on one count of “Possession with Intent to Distribute Cocaine Hydrochloride” and one count of “Unlawful Possession of a Firearm.” Darden is accused of having cocaine hydrochloride in September 2019 in Berkeley County. Darden, a person prohibited from having a firearm because of prior convictions, is accused of having a .45mm pistol in September 2019 in Berkeley County.
Darden faces up to 20 years of incarceration and a fine of up to $1,000,000 for the drug charge. He faces up to 10 years of incarceration and a fine of up to $250,000 for the firearms charge. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Eleanor F. Hurney is prosecuting the case on behalf of the government. The Eastern Panhandle Drug Task Force, a HIDTA-funded initiative, and the Berkeley County Sheriff’s Office investigated.
An indictment is merely an accusation. A defendant is presumed innocent unless and until proven guilty.
U.S. Magistrate Judge Robert W. Trumble presided.
Mansfield Man Sentenced to Federal Prison for Criminal ContemptRead the Press Release
A Mansfield man will be spending time behind bars for criminal contempt, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Larry Reynolds, 61, pleaded guilty to criminal contempt in February 2021. He was sentenced yesterday to six months in federal prison by U.S. District Judge Jane J. Boyle.
According to court documents, Mr. Reynolds, the former owner and general manager of Mansfield Boat and RV Storage, filed for Chapter 11 bankruptcy in December 2018. The U.S. Bankruptcy Court limited Mr. Reynolds use of cash and collateral and prohibited his business from making payments or reimbursements to himself.
In April 2019, Mr. Reynolds testified that he had withdrawn money from the Mansfield Boat and RV Storage bank account totaling $96,306 to pay for personal items including payments towards his home mortgage. At a subsequent hearing, Mr. Reynolds admitted to transferring and additional $45,000 from the Mansfield Boat and RV Storage bank account against the direction of the Court.
During the course of the bankruptcy proceedings, Mr. Reynolds was found in civil contempt seven times for failing the repay approximately $140,000 in funds that he misappropriated from his business’ bankruptcy estate without court authorization, failing to appear at a scheduled hearing, and failing to comply with accounting and information request by the Court.
In July 2020, the U.S. Bankruptcy Court for the Northern District of Texas referred the case to the United States Attorney’s Office for criminal contempt prosecution against Mr. Reynolds.
The FBI Dallas Field Office conducted the investigation. Assistant U.S. Attorney Shane Read prosecuted the case.
Man ordered to prison for transporting meth welded inside tiresRead the Press Release
BROWNSVILLE, Texas – A 68-year-old Mexican man has been sentenced after trying to cross the border with over 60 kilograms of meth, announced Acting U.S. Attorney Jennifer B. Lowery.
Benjamin Garcia-Alcantar, Morelia, Michoacan, Mexico, pleaded guilty Oct. 22, 2020, to possession with intent to distribute meth.
Today, U.S. District Judge Fernando Rodriguez Jr. handed him a 120-month sentence to be immediately followed by four years of supervised release. In handing down the sentence, the court noted Garcia-Alcantar’s age and lack of criminal history.
On May 16, 2020, Garcia-Alcantar had attempted to make entry into the United States via the Veteran’s International Bridge driving a 2007 GMC Sierra. The truck had a business decal displaying an American flag with both a Matamoros, Mexico, and Mission address. Garcia-Alantar claimed he had a business called “Good Been-Second-hand articles” and was bringing in an 8-foot medieval knight armor statue for resale. He added that he had been selling the medieval knights in Mission.
Authorities recalled a similar knight on a bed of a truck that had crossed on a previous occasion and sent him for further inspection. At secondary, law enforcement found 24 bundles enclosed in metal containers. They had been welded into the interior of the vehicle’s tires.
Authorities had to call a hazardous materials team to extract the narcotics.
The bundles held 62.44 kilograms of meth with an estimated street value of more than $1.8 million in Texas.
Garcia-Alcantar will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
Immigration Customs Enforcement conducted the investigation with the assistance of Customs Border Protection. Assistant U.S. Attorney Elena Llanos-Salinas prosecuted the case.
Man Pleads Guilty to Embezzlement from Pentagon Law Enforcement UnionRead the Press Release
ALEXANDRIA, Va. – A Quantico man pleaded guilty today to wire fraud in connection with a scheme to embezzle over $380,000 from his former union, which represented federal law enforcement officers at the Pentagon.
“The defendant routinely embezzled money that belonged to a federal law enforcement union to fund his personal expenditures while vacationing in the Dominican Republic and to pay for his personal gambling at a casino,” said Raj Parekh, Acting U.S. Attorney for the Eastern District of Virginia. “EDVA will continue to hold accountable those who steal and siphon off critical funds from our law enforcement partners.”
According to court documents, Arthur Penn, 64, served from 1999 through 2015 as the Chairman of the Fraternal Order of Police Defense Protective Service Labor Committee Pentagon, a local union that represented officers of the Pentagon Force Protection Agency. During his tenure, Penn routinely embezzled funds from the Union for his personal benefit, and spent the stolen funds on gambling, to pay for a personal trip to the Dominican Republic, and for his day-to-day living expenses.
“As alleged, for years Arthur Penn stole money from funds intended to benefit his fellow law enforcement colleagues and used the money for his own personal benefit and entertainment,” said James A. Dawson, Special Agent in Charge of the FBI’s Washington Field Office Criminal Division. “The FBI and our partners are dedicated to rooting out this type of opportunistic corruption and fraud, and ensuring those who commit these crimes are brought to justice.”
Penn sought to conceal and prevent the detection of his embezzlement by failing to make regular reports to Union members, by violating his obligation to file regular financial reports with the Department of Labor’s Office of Labor-Management Standards, and by siphoning off most of the embezzled funds through cash transactions, thereby avoiding the creation of financial records that would have revealed the fraud.
Penn is scheduled to be sentenced on July 2. 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; Mark Wheeler, District Director, Washington District Office, U.S. Department of Labor, Office of Labor-Management Standards; and James A. Dawson, Special Agent in Charge of the FBI’s Washington Field Office Criminal Division, made the announcement after Senior U.S. District Judge T.S. Ellis, III accepted the plea.
Assistant U.S. Attorneys Matthew Burke and Christopher Hood are prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:20-cr-251.
Man Pleads Guilty for Killing a Sand Springs Woman in a Drunk Driving CollisionRead the Press Release
A drunk driver who killed a woman in a 2019 collision pleaded guilty today to second degree murder in Indian Country, announced Acting U.S. Attorney Clint Johnson.
Hector Manuel Hernandez, 36, of Tulsa, admitted that he rear-ended a car while driving on South Garnett Road, and as he fled the first accident, hit the victim’s automobile head on. Jennifer Holt died from injuries sustained in the collision. Hernandez had a blood alcohol level of .250. He was previously convicted for DUI in Rogers County in 2007.
“Hector Hernandez made a series of incredibly selfish choices on Nov. 26, 2019. He drove with a blood alcohol level three times the legal limit, erratically sped away after causing one accident, then crossed the center line and took Jennifer Holt’s life,” said Acting U.S. Attorney Clint Johnson. “I appreciate the work of Assistant U.S. Attorney Justin Bish who secured today’s conviction for Jennifer and her family. Hernandez is scheduled to be sentenced on June 29.”
The Broken Arrow Police Department, FBI and Oklahoma State Bureau of Investigation conducted the investigation. Assistant U.S. Attorney Justin Bish is prosecuting the case. AUSA Bish is from the Western District of New York. He volunteered to assist prosecution efforts here in the Northern District of Oklahoma due to increased jurisdictional responsibilities regarding crimes involving Native American victims or defendants and that occur within the Muscogee (Creek) Nation and Cherokee Nation Reservations.
Longview Man Sentenced to More Than 30 Years in Federal Prison for Enticement of 10-Year-Old GirlRead the Press Release
A Longview man was sentenced today to more than 30 years in federal prison for attempted enticement of a child, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
Keith Lee Merchant – a 41-year-old man who was previously convicted in 2004 on state charges of sexually exploiting children – pleaded guilty to one count of attempted enticement of a child in October. He was sentenced today to 365 months in federal prison by U.S. District Judge Jane J. Boyle.
According to court documents, a federal agent acting in an undercover capacity responded to an online advertisement on a social media website entitled, “Taboo Family Fun – M4F 37 (Near You).” Within minutes, Mr. Merchant, the creator of the ad, replied to the undercover agent and initiated a three-week long, sexually explicit dialog via social media and Kik, a messaging app popular among teenagers.
During the communications, Mr. Merchant informed the undercover agent that he previously had sexual relations with young girls and that he was willing to have sexual relations with the undercover officer’s 10-year old daughter. Mr. Merchant expressed his desire to travel from his home in Longview to meet the 10-year-old girl and spend the night with her. He also promised to bring the young girl lingerie stating “got little miss a gift… I hope she likes purple.”
On March 23, 2018, Mr. Merchant traveled from his home in Longview to an apartment complex in Garland where he believed he was meeting the mother her daughter. When Mr. Merchant arrived at the apartment, FBI agents and Garland police officers were at the location and he was taken into custody. Inside his pickup truck, law enforcement located an overnight bag, a pink stuffed animal, a box of candy, and purple lingerie.
When questioned by law enforcement, Mr. Merchant admitted to posting the advertisement, “Taboo Family Fun” and agreed that the term “taboo” meant “underage.” Law enforcement forensically searched Mr. Merchant’s cell phone revealing his web history, internet searches, and bookmarks, all showing his interest in sexually exploiting children.
The FBI Dallas Field Office and the Garland Police Department conducted the investigation. Assistant U.S. Attorney Camille Sparks prosecuted the case.
This case was brought as part of Project Safe Childhood, a Justice Department initiative designed to combat the growing epidemic of child sexual exploitation and abuse nationwide. The initiative pools 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.
Lawrence Man Pleads Guilty to Heroin and Oxycodone OffensesRead the Press Release
BOSTON – A Lawrence man pleaded guilty yesterday in federal court in Boston to distributing heroin and possessing oxycodone in 2019.
William Cabrera, 32, pleaded guilty to one count of distribution of and possession with intent to distribute heroin and one count of possession with intent to distribute heroin and oxycodone. U.S. District Court Judge Indira Talwani scheduled sentencing for July 23, 2021.
On June 27, 2019, Cabrera was arrested after selling 10 grams of heroin. During a search of his residence, law enforcement recovered additional heroin, oxycodone, drug paraphernalia, a firearm and over $16,000 in cash.
In Sept. 2019, Cabrera was indicted as part of a coordinated enforcement operation in the Merrimack Valley dubbed “Devil’s Highway.” The operation targeted the distribution of opioids, including fentanyl and heroin, and resulted in charges against a total of 40 people for federal drug offenses, with at least a dozen more individuals facing state charges.
The charges of distribution of and possession with intent to distribute heroin and possession with intent to distribute heroin and oxycodone each carry a sentence of up to 20 years in prison, at least three years of supervised release and a fine of up to $1 million. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney Nathanial R. Mendell and Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division made the announcement. Valuable assistance was provided by the Drug Enforcement Administration, the Massachusetts State Police, the Lawrence Police Department and the North Andover Police Department. Assistant United States Attorney Eve A. Piemonte of Mendell’s office is 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.
Laurel woman sentenced for lying to get Social Security Administration benefitsRead the Press Release
BILLINGS – A Laurel woman who admitted lying to receive federal benefits to which she was not entitled was sentenced today to three years of probation and ordered to pay $325,870 restitution, Acting U.S. Attorney Leif Johnson said.
Tanya Smith, 45, pleaded guilty on Oct. 1, 2020 to theft of government property.
U.S. District Judge Susan P. Watters presided.
“Persons who lie to receive Social Security Administration and health care benefits at the expense of those who qualify for assistance will be fully investigated and prosecuted,” Acting U.S. Attorney Leif Johnson said.
“Supplemental Security Income is a needs-based safety net for the most vulnerable among us, and my office will aggressively pursue those who abuse it for personal gain,” said Gail S. Ennis, Inspector General for the Social Security Administration. “I want to thank the U.S. Attorney’s Office for its support of our investigation and its efforts to recover these taxpayer funds.”
In court documents filed by the government, prosecutors alleged that from about 2002 until 2019, Smith made misrepresentations about her living situation, marital status and income to the Social Security Administration to receive benefits. The misrepresentations resulted in Smith receiving $130,018 in Supplemental Security Income (SSI) and $195,852 in Medicaid benefits, for a total of $325,870, to which she otherwise was not entitled to receive. Smith began receiving SSI benefits in 1987 and then married in 2002. In 2004, Smith corrected her living situation with SSA, noting that she was married and living with her husband, making her ineligible to receive SSI benefits. About two months later, Smith falsely reported she had separated from her husband and was no longer living with him. Smith continued to make this false claim for the next 15 years. Smith admitted to law enforcement to concealing her living arrangement to secure government benefits.
Assistant U.S. Attorneys Bryan Dake and Karla Painter prosecuted the case, which was investigated by the Social Security Administration Office of the Inspector General.
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Laredo man sentenced for attempting to export 20,000 rounds of ammoRead the Press Release
LAREDO, Texas – A 48-year-old Laredoan has been ordered to federal prison for attempting to illegally export firearms and ammunition to Mexico, announced Acting U.S. Attorney Jennifer B. Lowery.
Juan Antonio Cepeda pleaded guilty Jan. 4.
Today, U.S. District Judge Diana Saldana ordered Cepeda to serve a 41-month sentence to be immediately followed by three years of supervised release. In handing down the sentence, Judge Saldana noted Cepeda had a lengthy criminal history and a long struggle with drug addiction.
On Sept. 14, 2020, Cepeda was traveling on Interstate Highway 35, when authorities conducted a traffic stop on his vehicle. Inside, they found 14 firearms and over 20,000 rounds of ammunition.
Cepeda admitted to knowingly attempting to export ammunition to Mexico for the promise of $2,000 payment.
Cepeda has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
Homeland Security Investigations and the Bureau of Alcohol, Tobacco, Firearms and Explosives jointly conducted the investigation with the Texas Department of Public Safety and Laredo Police Department. Assistant U.S. Attorney Francisco J. Rodriguez prosecuted the case.
Lackawanna County Man Pleads Guilty to Drug TraffickingRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Jean Quinones, age 26, of Scranton, Pennsylvania, pleaded guilty on March 24, 2021, before U.S. District Court Judge Malacy E. Mannion to attempt to possess with intent to distribute in excess of 500 grams of cocaine.
According to Acting United States Attorney Bruce D. Brandler, the charge stems from an investigation in which Customs and Border Patrol agents intercepted a package which had been mailed from the Virgin Islands to Scranton. The package was found to contain a kilogram of cocaine. Homeland Security agents and U.S. Postal Inspectors arrested Quinones shortly after he picked up the package at a post office in Scranton.
Judge Mannion ordered that a presentence investigation take place. Sentencing will be scheduled at a later date.
The investigation was conducted by the Homeland Security Investigations, the United States Postal Inspection Service, the United States Customs and Border Patrol, and the Scranton Police Department. Assistant United States Attorney Robert J. O’Hara is prosecuting the case.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
Under federal law, the drug trafficking offense carries a mandatory minimum sentence of five years in prison, up to a maximum sentence of forty years in prison, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Justice Department Settles Sexual Harassment Lawsuit Against Cumberland County, Tennessee for $1.1 MillionRead the Press Release
WASHINGTON – The Justice Department announced today that it has reached a settlement with Cumberland County, Tennessee, to resolve allegations that the county discriminated against ten female employees because of their sex in violation of Title VII of the Civil Rights Act of 1964.
Title VII is a federal statute that prohibits employment discrimination on the basis of race, sex, color, national origin and religion. Under the terms of the settlement, which still must be approved by the court in the form of a consent decree, Cumberland County will pay approximately $1.1 million in compensatory damages to ten women whom the United States alleged were sexually harassed by the former director of the county’s Solid Waste Department. Cumberland County will also revise its policies, procedures, and training to better prevent sexual harassment in the workplace.
“Today’s resolution, through settlement, will bring some measure of closure and vindication to the vulnerable women who were victimized by the egregious and abusive behavior in this case,” said Pamela S. Karlan, Principal Deputy Assistant Attorney General of the Civil Rights Division. “Sexual harassment must not be tolerated in the workplace, and we remain committed to eliminating it root and branch through our vigorous enforcement of Title VII.”
“No individual should have to endure the unwanted sexual advances of another, especially from someone who wields a position of authority over another as alleged here,” said Acting U.S. Attorney Mary Jane Stewart for the Middle District of Tennessee. “We will seek all available remedies to address such unwanted and unlawful conduct and will continue to protect the civil rights of all of our citizens. They deserve nothing less.”
“State and local governments are among our largest employers. It is important that they understand that the federal anti-discrimination laws also apply to them,” said Delner Franklin-Thomas, District Director of the Memphis District of the Equal Employment Opportunity Commission (EEOC). “The egregious sexual harassment that these women were subjected to contravenes Title VII. The EEOC will continue to collaborate with the Justice Department to ensure the protection of our workers in governmental workplaces.”
The Justice Department’s complaint, filed March 8, in the U.S. District Court for the Middle District of Tennessee, alleged, among other things, that Cumberland County failed to take adequate precautions to prevent the former director of the county’s Solid Waste Department from sexually harassing the women. According to the complaint, the former director regularly subjected the women, who all worked for him, to unwanted sexual contact, including kissing and groping; unwelcome sexual advances, including propositioning the women for sexual favors; and offensive sexual remarks about their bodies and sex acts. The former director has been indicted on criminal charges and is awaiting trial in state court.
Four of the women had filed charges of discrimination with the EEOC. The EEOC’s Nashville Area Office, in its Memphis District, investigated the charges and found reasonable cause to believe Cumberland County discriminated against the four women and other similarly situated employees. After unsuccessful conciliation efforts, the EEOC referred the charges to the Justice Department’s Civil Rights Division. The Justice Department brought this lawsuit as part of a joint effort to enhance collaboration between the Department and the EEOC in the vigorous enforcement of Title VII.
This lawsuit is part of the Civil Rights Division’s Sexual Harassment in the Workplace Initiative, which is aimed at eradicating sexual harassment in state and local government workplaces. It focuses on litigation, outreach and development of effective remedial measures to address and prevent future sex discrimination and harassment.
This lawsuit was handled by Trial Attorneys Jen Swedish and Julia Quinn of the Civil Rights Division’s Employment Litigation Section and by Assistant U.S. Attorney Kara Sweet of the U.S. Attorney’s Office for the Middle District of Tennessee.
The full and fair enforcement of Title VII is a top priority of the Employment Litigation Section of the Civil Rights Division. Additional information about the Civil Rights Division and the jurisdiction of the Employment Litigation Section is available on its websites at www.justice.gov/crt/ and https://www.justice.gov/crt/employment-litigation-section.
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Judge sentences St. Louis man for his role in drug-trafficking ringRead the Press Release
ST. LOUIS – United States District Judge Ronnie L. White sentenced Sherod Tucker to 80 months in prison today. The 32-year-old St. Louis, Missouri resident pleaded guilty to conspiracy to distribute and possession with the intent to distribute fentanyl.
Beginning in 2016, the Drug Enforcement Administration and St. Louis County Police Department were actively investigating the distribution of large quantities of fentanyl and crystal methamphetamine in the St. Louis Metropolitan Area. Tucker conspired with members of the conspiracy to distribute and possession with intent to distribute in excess of 400 grams of fentanyl.
At the height of the conspiracy, nine co-conspirators were involved and would distribute more than 20,000 doses of fentanyl per week. Distribution occurred through the use of "runners" to include Tucker.
On January 31 and on August 9, 2018 Tucker sold fentanyl to a cooperating source working on behalf of the DEA. Tucker also assisted members of the conspiracy by cutting up the raw fentanyl with Dormin, before the drugs were pressed into capsules for sale. The indictment alleges the conspiracy involved committing violence in furtherance of drug trafficking to include committing two murders and another shooting. Tucker was not charged with the violence.
The St. Louis County Police Department and Drug Enforcement Administration investigated the case. Assistant United States Attorney Paul D’Agrosa is handling the case.
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Jackson County Bait Operator Pleads Guilty to Illegal Seafood TraffickingRead the Press Release
Gulfport, Miss. – Joshua Jerome Moak, 36, of Moss Point, Mississippi, who operated a business known as “Moak’s Minnows” in Jackson County, pled guilty today to violating the federal Lacey Act, announced Acting U.S. Attorney Darren LaMarca; Manny Antonaras, Assistant Director of the National Oceanic and Atmospheric Administration, Office of Law Enforcement; and Chief Kyle Wilkerson of the Mississippi Department of Marine Resources, Office of Marine Patrol. The federal Lacey Act makes it unlawful to sell in interstate commerce any fish taken in violation of state law.
Moak pled guilty before U.S. District Judge Taylor McNeel. He made his initial appearance and waived indictment earlier today before U.S. Magistrate Judge John Gargiulo at the federal courthouse in Gulfport.
In the felony information to which Moak pled guilty, he was charged with violating the Lacey Act by selling live shrimp and minnows to bait shop operators in Alabama and Florida. Moak caught the bait in Mississippi waters and then transported the bait to out-of-state bait shop operators without having a license and otherwise complying with requirements of Mississippi law. As administered by the Mississippi Department of Marine Resources, Mississippi regulates the seafood industry to preserve fish stocks and protect the local fishing market.
“The U.S. Department of Justice is committed to prosecuting unlicensed dealers and others who jeopardize our nation’s fisheries by illegally transporting catch in interstate commerce in violation of state law," said Acting United States Attorney LaMarca. "Preserving our nation's fishing industry is essential to the sustainable management of our fisheries resource."
For the Lacey Act charge, Moak faces a maximum of five years of imprisonment. In addition to possible imprisonment, the defendant faces a maximum fine of $250,000, and three years of supervised release. Sentencing has been scheduled for June 24, 2021 at 10:00 a.m. before U.S. District Judge Taylor McNeel.
Acting United States Attorney LaMarca praised the efforts of the federal and state investigative agencies for their diligent work in the investigation of this matter. The case was investigated by NOAA Office of Law Enforcement and Mississippi Department of Marine Resources. It is being prosecuted by Assistant U.S. Attorney Gaines Cleveland.
Houston Man Sentenced for Heroin ConspiracyRead the Press Release
NEW ORLEANS – U.S. Attorney Duane A. Evans announced that on March 18, 2021, CARLOS ALBERTO GONZALES VALENCIA, age 38, of Houston, Texas, was sentenced by United States District Judge Barry W. Ashe after previously pleading guilty to one count of conspiracy to distribute and to possess with intent to distribute more than one kilogram of heroin.
According to court documents, VALENCIA and others conspired to distribute and to possess with intent to distribute one kilogram or more of heroin between sometime prior to July 19, 2017 and on or about June 29, 2018.
United States District Court Judge Ashe sentenced VALENCIA to 57 months of imprisonment, followed by two years of supervised release. The Court also imposed a $100 mandatory special assessment.
U.S. Attorney Duane A. Evans praised the work of the Federal Bureau of Investigation, the Drug Enforcement Administration, and the New Orleans Police Department in investigating this matter. Assistant United States Attorneys Maria Carboni and Jonathan L. Shih were in charge of the prosecution.
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Houston Man Sentenced for Heroin ConspiracyRead the Press Release
NEW ORLEANS – U.S. Attorney Duane A. Evans announced that on March 18, 2021, HARVEY VICTORIA-CUELLAR, age 41, of Houston, Texas, was sentenced by United States District Judge Barry W. Ashe after previously pleading guilty to one count of conspiracy to distribute and to possess with intent to distribute more than one kilogram of heroin.
According to court documents, VICTORIA-CUELLAR and others conspired to distribute and to possess with intent to distribute one kilogram or more of heroin between sometime prior to July 19, 2017 and on or about June 29, 2018.
United States District Court Judge Ashe sentenced VICTORIA-CUELLAR to 78 months of imprisonment, followed by three years of supervised release. The Court also imposed a $100 mandatory special assessment.
U.S. Attorney Duane A. Evans praised the work of the Federal Bureau of Investigation, the Drug Enforcement Administration, and the New Orleans Police Department in investigating this matter. Assistant United States Attorneys Maria Carboni and Jonathan L. Shih were in charge of the prosecution.
Honduran National Pleads Guilty and is Sentenced for Illegal Re-EntryRead the Press Release
NEW ORLEANS - U.S. Attorney Duane A. Evans announced today that Miguel Angel Solorzano-Dominguez, age 34, pleaded guilty and was sentenced today on a one-count indictment. He was charged by a Grand Jury in March 2020 with illegal reentry of a removed alien, in violation of Title 8, United States Code, Section 1326(a).
After accepting Solorzano-Dominguez guilty plea, U.S. District Judge Mary Ann Vial Lemmon sentenced Solorzano-Dominguez to time served and a $100 special assessment fee. Solorzano-Dominguez has been incarcerated since February 1, 2020. The defendant will be surrendered to the custody of the U.S. Immigration and Customs Enforcement for removal proceedings.
According to documents signed by the defendant and filed in open court, Solorzano-Dominguez admitted to being a citizen of Honduras, and being illegally present in the United States. He further admitted to illegally re-entering the United States after being deported July 9, 2010.
U.S. Attorney Evans praised the work of the United States Department of Homeland Security and the New Orleans Police Department in investigating this matter. Assistant U. S. Attorney Carter K. D. Guice, Jr. is in charge of the prosecution.
Helena man suspected of possessing stolen firearm appears in courtRead the Press Release
MISSOULA – A Helena man arrested on a federal warrant by the Bureau of Alcohol, Tobacco, Firearms and Explosives on suspicion of possessing a stolen firearm appeared in U.S. District Court today on a criminal complaint, Acting U.S. Attorney Leif Johnson said.
The criminal complaint filed in the case accuses Robert Raymond Fasuga, 39, of possession of a stolen firearm. If convicted of the most serious crime, Fasuga faces a maximum 10 years in prison, a $250,000 fine and three years of supervised release.
A criminal complaint is only an accusation, and a defendant is presumed innocent until proven guilty beyond a reasonable doubt.
U.S. Magistrate Judge Kathleen L. DeSoto presided. Fasuga was detained pending further proceedings.
According to the criminal complaint and affidavit filed in support of the complaint, on June 15, 2020, Fasuga engaged the Lewis and Clark County Sheriff’s Office in a vehicle pursuit that led to Fasuga’s residence. In attempting to arrest Fasuga, Fasuga threatened suicide with two pistols he had on his person. Deputies talked Fasuga into putting down the firearms and took him into custody. The court documents further allege the investigation determined that one of the firearms recovered from Fasuga was suspected of having been stolen from Mountain Man Trading Post in January 2020.
The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Lewis and Clark County Sheriff’s Office investigated the case.
PACER case reference. 21-05.
The progress of cases may be monitored through the U.S. District Court Calendar and the PACER system. To establish a PACER account, which provides electronic access to review documents filed in a case, please visit http://www.pacer.gov/register.html. To access the District Court’s calendar, please visit https://ecf.mtd.uscourts.gov/cgi-bin/PublicCalendar.pl.
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Harlem man sentenced for domestic abuseRead the Press Release
GREAT FALLS – A Harlem man who admitted a domestic abuse crime after beating a woman on the Fort Belknap Indian Reservation was sentenced today to 30 months in prison and to two years of supervised release, Acting U.S. Attorney Leif Johnson said.
Jeremy Leo Tincher, 39, pleaded guilty on Nov. 10, 2020 to domestic abuse by habitual offender.
Chief U.S. District Judge Brian M. Morris presided.
In court documents filed in the case, the government alleged that Tincher attacked and injured the victim, identified as Jane Doe, on Aug. 9, 2019 as she was driving on the Fort Belknap Indian Reservation. The victim drove directly to the police station seeking help and was treated for injuries.
Assistant U.S. Attorney Jared Cobell prosecuted the case, which was investigated by the FBI and Fort Belknap Tribal Police.
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Grand Jury Indicts Level 1 Sex Offender on Charges of Receipt and Possession of Child PornographyRead 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 a federal grand jury has returned an indictment charging Zachary Feeterman, 26, of Tonawanda, NY, with receipt and possession of child pornography. Based on the defendant’s prior conviction, the charges carry a mandatory minimum penalty of 15 years in prison, a maximum of 40 years, and a $250,000 fine.
Assistant U.S. Attorney Aaron J. Mango, who is handling the case, stated that according to the indictment and a previously filed complaint, on August 8, 2019, two Erie County Probation Officers were conducting a routine home visit at the defendant’s residence where they discovered a cellular telephone. In November 2015, Feeterman was convicted of Attempted Possession of a Sexual Performance by a Child less than 16 years old and was a Level 1 Sex Offender on probation. As a result, he is prohibited from possessing a cell phone. During a search of the phone, the probation officers discovered several anonymous chatting and social media applications. One of the applications was KEEPSAFE, a vault storage application that looks like a calculator. The application contained files with images and videos of child pornography. Investigators also found numerous other images and videos of child pornography on the phone. Some of the images and videos included prepubescent children and depictions of violence.
Feeterman will be arraigned before U.S. Magistrate Judge H. Kenneth Schroeder, Jr. on March 26, 2021, at 1:00 p.m.
The indictment is the result of an investigation by members the Erie County Probation Department, under the direction of Commissioner Brian McLaughlin; the FBI's Child Exploitation Task Force, under the direction of Special Agent-in-Charge Stephen Belongia; and the Town of Tonawanda Police Department, under the direction of Chief James P. Stauffiger.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
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Former Oil Trader Pleads Guilty to Commodities Price Manipulation ConspiracyRead the Press Release
A California man pleaded guilty Wednesday to a multiyear conspiracy to engage in commodities price manipulation.
According to court documents and statements made in court, Emilio Jose Heredia Collado, 49, of Lafayette, was employed as a trader at Company A, an oil trading company, and later at Company B, a multinational commodity trading company, after it had acquired Company A. Between approximately September 2012 and August 2016, Heredia conspired with other employees at Company A, and later at Company B, to manipulate the price of fuel oil bought from, and sold to, a particular counterparty, Company C, through private, bilateral contracts.
“The defendant and his co-conspirators unlawfully manipulated the fuel oil market for their own gain by creating artificial prices that undermined the legitimate forces of supply and demand in one of our nation’s key commodity markets,” said Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division. “This prosecution demonstrates the department’s commitment to working with our law enforcement partners to identify and prosecute individuals who would seek to manipulate commodities benchmark prices while trading in the open market.”
“Individuals profiteering, through the manipulation of daily price assessments of a valuable commodity, fuel oil, prior to the purchasing or selling of it, goes against the most fundamental concepts of a supply-and-demand market economy,” said Assistant Inspector in Charge Raimundo Marrero of the U.S. Postal Inspection Service Criminal Investigation Group. “These fraudulent practices have no place in the international marketplace. This guilty plea showcases the U.S. Postal Inspection Service’s tenacity to hold individuals accountable for their dishonest actions and the resolve to continue to protect consumers and businesses. To criminals out there, the U.S. Postal Inspection Service and our federal partners will ensure your criminal endeavors are brought to justice.”
Heredia and his co-conspirators sought to unlawfully enrich themselves, Company A, and Company B by increasing profits and reducing costs on the fuel oil contracts with Company C. The price terms of the contracts were set by reference to the daily benchmark price assessment published by S&P Global Platts (Platts) for intermediate fuel oil 380 CST at the Port of Los Angeles (Los Angeles 380 CST Bunker Fuel) on a certain day or days plus or minus a fixed premium. As part of the price manipulation conspiracy, Heredia directed his co-conspirators to submit orders to buy and sell (bids and offers) to Platts during the daily trading “window” for the Platts Los Angeles 380 CST Bunker Fuel price assessment with the intent to artificially push the price assessment up or down.
For example, if Company A or Company B had a contract to buy fuel oil from Company C, Heredia directed his co-conspirators to submit offers during the Platts “window” for the express purpose of pushing down the price assessment and hence the price of fuel oil bought from Company C. The bids and offers were not submitted to Platts for any legitimate economic reason by Heredia’s and his co-conspirators, but rather for the purpose of artificially affecting the Platts Los Angeles 380 CST Bunker Fuel price assessment so that the benchmark price, and hence the price of fuel oil that Company A or Company B bought from, and sold to, Company C, did not reflect legitimate forces of supply and demand.
The U.S. Postal Inspection Service is investigating the case.
Acting Principal Assistant Chief Avi Perry and Trial Attorney Matthew F. Sullivan of the Justice Department’s Fraud Section are prosecuting the case.
The Criminal Division’s Fraud Section plays a pivotal role in the Justice Department's fight against white collar crime around the country and is the national leader in prosecuting fraud and manipulation in the U.S. commodity markets.
Former Mexican governor and presidential candidate convicted of money launderingRead the Press Release
HOUSTON - The former governor of Tamaulipas, Mexico, has admitted he accepted over $3.5 million in illegal bribe money and used it to fraudulently purchase property in the United States, announced Acting U.S. Attorney Jennifer B. Lowery.
Tomas Yarrington Ruvalcaba, 64, was also a former candidate for president of Mexico. Today, he admitted to a charge of conspiracy to commit money laundering in a pay to play type of scheme.
As part of the plea, Yarrington admitted he accepted bribes from individuals and private companies in Mexico to do business with the state of Tamaulipas while he served as governor. Yarrington was in that position from 1999 to 2005. He was also an Institutional Revolutionary Party candidate for president of Mexico in 2005.
Yarrington used the bribery money he received while governor to purchase properties in the United States. He had prestanombres - nominee buyers - purchase property in the United States to hide Yarrington’s ownership of the properties and the illegal bribery money used to purchase them.
Yarrington admitted one of the illegally purchased properties was a condominium in Port Isabel. He also acknowledged he knew it was against the law in Mexico to take the bribes and to hide the over $3.5 million in illegal bribe money in the United States by buying real estate, cars and other personal items.
U.S. District Judge Hilda G. Tagle accepted the plea and will set sentencing at a later date. At that time, Yarrington faces up to 20 years in federal prison. He has also agreed to forfeit the Port Isabel condominium.
In April 2017, authorities captured Yarrington in Italy while traveling under an assumed name and false passport and other identification documents. He was taken into custody on a provisional arrest warrant based on the indictment returned in May 2013. Although Yarrington contested extradition, Italian authorities eventually authorized his extradition to the United States. He arrived in April 2018 where he has remained in custody.
Homeland Security Investigations (HSI) led the Organized Crime Drug Enforcement Task Force (OCDETF) operation dubbed Operation Green Tide with the assistance of IRS – Criminal Investigation, Drug Enforcement Administration, FBI and Texas Attorney General’s Office. It included agents and officers in Brownsville, San Antonio, Houston, Corpus Christi and New York. The Justice Department’s Office of International Affairs handled the extradition in this matter. The U.S. government also acknowledges with gratitude the significant assistance received from the government of Mexico in the course of this investigation. Additionally, the United States acknowledges the assistance of the U.S. Marshals Service, HSI-Rome, HSI-Mexico City, the Italian Ministry of the Interior (particularly Interpol Rome and the Central Operations Service of the Italian National Police) and the Italian Ministry of Justice in Yarrington’s extradition.
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 Jody Young, Jon Muschenheim and Karen Betancourt are prosecuting the case.
Former Kauai JROTC instructor arrested for sexual exploitation of former studentRead the Press Release
HONOLULU – VICTOR AGUILAR, a 65-year-old resident of Kauai, was arrested on two counts of sexual exploitation of a child under the age of 18 for the purpose of producing child pornography. Judith A. Philips, Acting United States Attorney for the District of Hawaii, John F. Tobon, Special Agent in Charge of the Honolulu Field Office of Homeland Security Investigations (“HSI”), and Todd Raybuck, Chief of the Kauai Police Department (“KPD”), announced that the charges were contained in a criminal complaint filed in federal court and unsealed today upon the arrest. AGUILAR will make his first court appearance in United States District court on March 29 2021,at 9:30 before United States Magistrate Judge Rom Trader.
The complaint and affidavit allege that AGUILAR was his victim’s Junior Reserve Officers’ Training Corps (“JROTC”) instructor, and that he sexually exploited the minor victim in his home, in his vehicle, and at the high school at which he worked. Also included in the information contained in those documents is the following:
Beginning in or around 1995, AGUILAR acted as a JROTC instructor at Waimea High School on Kauai, a position from which he recently resigned. The program at has included anywhere from 49 to 205 cadets, at times encompassing as much as 20 percent of the student population. One of AGUILAR’s former JROTC students was the victim in the complaint. Photographs and videos recovered from AGUILAR’s work-issued laptop and portable hard drive reveal that in 2020, AGUILAR sexually exploited the victim and created videos of this sexual exploitation, which videos form the basis for the federal criminal charges in the complaint. An examination of AGUILAR’s work-issued laptop and portable hard drive also revealed that AGUILAR compiled subfolders of students and/or former students of Waimea High School’s JROTC, which appear to date from in or about 2009 until recently, consisting mainly of images that appear to have been pulled from social media websites.
If indicted and convicted of the offenses in the complaint, the defendant would face a mandatory minimum of 15 years’ imprisonment and a statutory maximum of 30 years’ imprisonment on each count. The maximum potential sentence is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the sentencing judge. The complaint also notes that on or about March 11, 2021, AGUILAR was arrested on a state indictment, brought by the County of Kauai Office of the Prosecuting Attorney, charging him with having sexually assaulted a former student. The charges and information contained in the federal complaint and state indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty, which, as to the federal charges, also requires the filing of the charges in an indictment.
Acting U.S. Attorney Philips praised the outstanding investigative work of HSI and the Major Crimes Section and the Crime Scene and Laboratory Section of KPD. She also thanked the County of Kauai Office of the Prosecuting Attorney, Waimea High School, the State of Hawaii Department of Education Equity Specialist for the Kauai District, the State of Hawaii Department of Education, the Hawaii Department of Education JROTC Command, and the Hawaii Department of Human Services, Child Welfare Services for their assistance.
“Our main focus is the victims of these heinous crimes,” says Special Agent in Charge of HSI Honolulu John F. Tobon. “Prosecuting predators hopefully brings some comfort to those victimized and to the community in general.”
The State of Hawaii Department of Education’s Kauai District is working to identify individuals whose images were stored on AGUILAR’s devices or who otherwise may have been affected by AGUILAR’s conduct, and is preparing a letter that will be sent to notify those individuals. If you believe you or anyone else may have been affected, you may contact David Dooley, Equity Specialist, at (808) 379-5299, or at 3060 Eiwa Street, Room 305, Lihue, Hawaii 96766.
The prosecution is handled by Assistant U.S. Attorneys Micah Smith and Morgan Early.
Former Green Valley Fire Captain Sentenced to 90 Months in Prison for Child ExploitationRead the Press Release
TUCSON, Ariz. – Nathanael Dougall, 39, of Tucson, Arizona, was sentenced yesterday by United States District Judge James Soto to 90 months in prison. Dougall previously pleaded guilty to Distribution of Child Pornography.
On November 8, 2018, Dougall was arrested for sharing child sex abuse images on a messaging application with an individual he believed to be a 14-year-old girl. Dougall used the same application to engage in sexually explicit chats with the girl, who was actually an undercover law enforcement officer. Dougall worked as the Captain for the Green Valley Fire Department until his arrest.
Upon release from prison, Dougall will be placed on lifetime supervised release. He will be required to register as a sex offender and to complete a sex offender treatment program. Dougall was also ordered to pay restitution to several victims depicted in the child sex abuse images he possessed and distributed.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorney’s 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.
Homeland Security Investigations (HSI), Douglas, conducted the investigation in this case. Carin C. Duryee and Nathaniel Walters, Assistant U.S. Attorneys, District of Arizona, Tucson, handled the prosecution.
CASE NUMBER: CR 18-02526-TUC-JAS
RELEASE NUMBER: 2021-017_Dougall# # #
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.Former General Manager of Sioux Center Cooperative Sentenced to Prison in Grain Blending SchemeRead the Press Release
The former general manager of a Sioux Center grain cooperative who directed subordinate managers to blend oats into soybeans was sentenced March 24, 2021, to three months in federal prison.
Kenneth Ehrp, age 76, from Dakota Dunes, South Dakota, received the prison term after a November 2, 2020 guilty plea to one count of conspiracy to commit a prohibited grain practice.
In a plea agreement, and at guilty plea and sentencing hearings, Ehrp admitted he was the General Manager at a large, federally licensed grain warehouse that is headquartered in Sioux Center but has satellite locations in Iowa and elsewhere. No later than July 2015, Ehrp agreed with Calvin Diehl and others to add lower value oats to soybeans and sell the mixture as soybeans. As part of the grain blending scheme, Diehl and other individuals acting at Ehrp’s direction made false statements and executed false certificates to USDA inspectors, layered soybeans on top of oats in both storage bins and trucks to deceive USDA inspectors and customers about the quality and quantity of the grain, and made false entries and adjustments in reports provided to the grain warehouse’s bank.
In March 2017, one of Ehrp’s subordinate managers instructed a warehouse manager in Worthing, South Dakota, to blend more oats with soybeans. As a result, approximately 30 truckloads of soybeans were “spiked” with oats. After the customer happened to discover the badly “slugged” or “spiked” loads, one of the customer’s managers called Diehl and told him to stop blending oats into soybeans. The manager warned Diehl that “someone can go to jail for this.” Diehl feigned surprise, apologized, and falsely promised that the practice would not happen in the future. However, at Ehrp’s direction, Diehl and others continued to blend oats into soybeans (even directing subordinates to remix one of the “slugged” loads) and sell them to the same unwitting customer. Ehrp himself drove to the location manager’s office in Worthing and ordered him to continue blending oats. As a result, the Worthing location manager designed a new system for blending oats into soybeans, involving an auger and a conveyer, which sprinkled oats into the semi-trucks’ hoppers and ensured the loads leaving Worthing would remain hidden.
After learning of the conspiracy, the USDA conducted a search of grain bins at the cooperative’s various locations in Iowa and South Dakota. Of the estimated 87,996 bushels of grain in the bins at these locations, the bins actually contained only 34,354 bushels of soybeans even though all of these bins had been certified as soybeans.
Ehrp was sentenced in Sioux City by United States District Court Chief Judge Leonard T. Strand. Ehrp was sentenced to three months’ imprisonment and fined $50,000. He was ordered to pay $4,089.73 in costs of prosecution, and he also must serve a one-year term of supervised release after the prison term. There is no parole in the federal system.
Ehrp was released on the bond previously set and is to surrender to the Bureau of Prisons on a date yet to be set. Earlier this year, Diehl was also sentenced to three months’ imprisonment for his role in the grain blending scheme.
The case was prosecuted by Assistant United States Attorneys Timothy L. Vavricek and Matthew J. Cole and investigated by the United States Department of Agriculture - Office of Inspector General, and the Federal Bureau of Investigation.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 19-CR-4093.
Follow us on Twitter @USAO_NDIA.
Former Evansville Plastics Company Executives Sentenced for Securities Fraud SchemeRead the Press Release
EVANSVILLE – Acting U.S. Attorney John E. Childress announced today that Kevin Kuhnash, 59, of Ohio, and Jason Jimerson, 46, of Alabama, were sentenced to federal prison by U.S. District Judge Richard L. Young. Kuhnash received a 36-month prison sentence, and Jimerson received a 24-month sentence.
A federal grand jury indicted Kuhnash and Jimerson in December 2018, and both were later arrested by the FBI and IRS-Criminal Investigation. In mid-2020, both men pleaded guilty to charges of securities fraud and money laundering. Jimerson also pleaded guilty to lying to federal agents.
“Those who choose fraud over fair dealing must be held accountable,” said Childress. “That is particularly true for corporate leaders like Kuhnash and Jimerson whom society relies on to ensure the fairness and integrity of business and the marketplace.”
Both men admitted that they concealed critical defects in Lucent’s business when they orchestrated the sale of the company to a private equity firm in late 2013 for over $64 million. Kuhnash and Jimerson claimed that Lucent could produce specialized plastics products that consistently met or exceeded customer specs at very low prices by using low-cost, recycled materials.
Lucent’s internal testing showed that many of its most profitable products often failed to meet specifications. This information was hidden from customers and Lucent shipped the products with a fabricated set of test results that falsely claimed the product was within specifications.
Kuhnash and Jimerson became aware of all of this in the months leading up to the sale of the company. Both men admitted to being aware of an email from a whistleblower employee who disclosed what he described as “ethical/conscience issues” and “a level of dishonesty” at Lucent. The email described the fraud that Lucent was perpetrating on its customers, including the manipulated test results, and lying to customers. Jimerson agreed with Kuhnash to not forward the email or let anyone know they received it.
Kuhnash and Jimerson never disclosed the fraud during their company sales pitches or the due diligence process leading up to Lucent’s sale to the private equity firm. After the company was sold, both Kuhnash and Jimerson lied to the private equity firm’s outside auditor about whether they were aware of any fraud at Lucent.
As executives, both men owned stock in Lucent. From selling the company, Kuhnash personally received approximately $1,393,000 and Jimerson received approximately $632,000.
The private equity firm that bought Lucent later sold it to a publicly traded plastics company. Lucent’s fraud on its customers was later discovered by that publicly traded company. On the day that Lucent’s fraud was publicly disclosed to investors, the company’s stock price fell by over 20%, or over $175 million in shareholder value.
This investigation was a collaborative effort between the Federal Bureau of Investigation and Internal Revenue Service Criminal Investigation.
“These two men knew of the fraudulent practices at the company they led, but chose to let it continue out of sheer greed, going even further by remaining silent as the company was sold for the sole purpose of enriching themselves,” said FBI Indianapolis Special Agent in Charge Paul Keenan. “This case demonstrates the strong partnerships the FBI has and the diligent work of all involved to combat significant fraud schemes such as this.”
“Internal Revenue Service Criminal Investigation (IRS-CI) is relentless in unraveling the fraudulent actions of those, such as Kevin Kuhnash and Jason Jimerson, who schemed to defraud customers and potential future owners of their business,” said Acting Special Agent in Charge Tamera Cantu of IRS-CI’s Chicago Field Office. “Today’s sentencing is a reminder that there are detrimental consequences for this type of criminal behavior, and our Special Agents are determined in their efforts to uphold the justice system.”
According to Assistant United States Attorneys Nick Linder and Kyle Sawa, who prosecuted this case for the government, Kuhnash will also serve 1 year of supervised release following his imprisonment and pay a $10,000 fine. Jimerson will serve 2 years of supervised release following his imprisonment and pay a $10,000 fine.
In November of 2020, Acting United States Attorney John E. Childress renewed a Strategic Plan designed to shape and strengthen the District’s response to its most significant public safety challenges. This prosecution demonstrates the Office’s enduring commitment to investigating and prosecuting those who engage in fraud and money laundering. See United States Attorney’s Office, Southern District of Indiana Strategic Plan Section 5.1.
Former Bar Harbor Postal Employee Pleads Guilty to Stealing MailRead the Press Release
BANGOR, Maine: A Hancock man pleaded guilty today in federal court to theft of mail by a postal employee, Acting U.S. Attorney Donald E. Clark announced.
According to court records, Daniel Hindes, 35, worked as a rural carrier associate out of the Bar Harbor Post Office. From November 2019 through March 2020, he opened mail addressed to customers on his route and stole cash and gift cards. He then discarded the opened mail into the garbage rather than delivering the items. When interviewed by federal investigators, he admitted to opening 20 to 30 letters and taking cash and gift cards inside them.
Hindes faces up to five years in prison, three years of supervised release and a fine. He will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
The U.S. Postal Service Office of Inspector General investigated the case.
Financial Advisor of Global Investment Bank Sentenced in Federal Court in Maryland to Five Years in Prison for $6 Million Wire Fraud and Investment Adviser Fraud SchemeRead the Press Release
Greenbelt, Maryland – U.S. District Judge Paul W. Grimm today sentenced Michael Barry Carter, age 47, of Potomac Falls, Virginia, to five years in federal prison, followed by three years of supervised release, on charges of wire fraud and investment adviser fraud, in connection with a scheme to steal more than $6 million. Judge Grimm also ordered Carter to pay a money judgment in the amount of the net proceeds he obtained from the scheme, which was at least $4,355,110.39.
The sentence was announced by Acting United States Attorney for the District of Maryland Jonathan F. Lenzner and Special Agent in Charge Jennifer C. Boone of the Federal Bureau of Investigation, Baltimore Field Office.
“For more than 12 years, Michael Carter perpetrated a brazen scheme that defrauded victim account holders at a global bank of their life savings,” said Acting U.S. Attorney Jonathan F. Lenzner. “When his fraud was discovered, Carter repaid some victims by stealing money from other victim accounts, and ultimately he stole close to $5 million. This case reflects the reality that large-scale fraud can still occur at a global institution with a robust compliance program, and it also reflects our commitment to holding bad actors accountable in order to provide restitution to victims and restore confidence in our system. The U.S. Attorney’s Office will continue to work closely with our federal law enforcement partners and the Securities and Exchange Commission to hold accountable financial advisors who defraud victims whose investments they are supposed to protect.”
According to his guilty plea, from August 7, 2006 to April 29, 2011, and again from November 16, 2011 to July 29, 2019, Carter was employed by a financial institution and worked primarily out of the financial institution’s Tysons Corner, Virginia location. In 2012, Carter was promoted to financial adviser in the wealth management section of the financial institution and was registered to sell securities and act as an investment adviser in Maryland and Virginia, among other locations. Carter managed and had authority over multiple investment accounts maintained by Victims 1 through 5 (as listed in the indictment) with the financial institution, which contained a mix of assets including securities and cash deposits. As a financial adviser, Carter was required to manage the victim accounts in the best interests of his clients, consistent with their investment objectives, and not for his personal benefit.
As detailed in the statement of facts, from at least October 2007 to at least July 2019, Carter made numerous unauthorized transactions from the victim accounts for his personal benefit, defrauding Victims 1 through 5 of at least $5 million. To effect the unauthorized wire transfers, Carter caused the submission of an internal bank authorization form that falsely stated that Carter had received verbal client instructions from each victim authorizing the transfer at a specific date and time. Carter caused the wire transfers to be sent to his personal accounts and used the money to pay for his lifestyle expenses, including Carter’s mortgage, credit card bills, and country club membership fees.
Carter’s fraud was first discovered when Victim 1 and her adult daughter attempted to obtain a bridge loan from the financial institution to cover relocation expenses to an assisted living facility in Florida until the sale of Victim 1’s home in Columbia, Maryland, was completed. When they applied for the loan, Victim 1 and her daughter discovered that an $800,000 loan had already been obtained in Victim 1’s name, without Victim 1’s knowledge or permission. The financial institution determined that the disbursement of the loan proceeds went to Carter’s personal bank account and that Carter used his personal e-mail address in furtherance of the fraud. The financial institution then learned that Carter had transferred approximately $5 million in unauthorized funds associated with clients of the financial institution.
On July 29, 2019, Carter was fired from the financial institution. On August 2, 2019, during a call with employees from the financial institution, Carter admitted that he had defrauded the five victims over a period of years, that he had forged clients’ signatures on bank authorization forms, that he had created false financial statements to disguise his theft, and in some cases had mailed those financial statements. With respect to Victim 1, Carter further admitted that he had met with the victim at her home and answered Victim 1’s phone in order to authorize the transactions, unbeknownst to Victim 1. Carter did this in order to overcome the financial institution’s multi-factor verification system required to execute the transactions.
According to the plea agreement, during the course of the scheme, Carter made at least 53 unauthorized transfers from his clients’ accounts to his own accounts. In addition, Carter admitted that he embezzled more than $50,000 from a non-profit sports organization located in Loudoun County, Virginia. In all, Carter stole at least $6,149,162.77. Prior to his offenses being detected, Carter caused $1,794,052.38 to be returned to the victims. After learning that his fraud had been discovered, in October 2019, Carter also repaid the non-profit organization for its loss. Of the total amount repaid, $1,118,318.52 was repaid through transfers Carter made from other victim accounts.
Acting United States Attorney Jonathan F. Lenzner commended the FBI for their work in the investigation and recognized the Securities and Exchange Commission, which has filed a related civil proceeding. Mr. Lenzner thanked Assistant U.S. Attorneys Erin B. Pulice and Jennifer L. Wine, who prosecuted the criminal case.
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Felon Sentenced for Possessing A Firearm and AmmunitionRead 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 Javarus Payne, 34, of Rochester, NY, who was convicted of being a felon in possession of a firearm and ammunition, was sentenced to serve 37 months in prison by U.S. District Judge David G. Larimer.
Assistant U.S. Attorney Charles Moynihan, who handled the case, stated that the defendant was arrested on August 29, 2020, after officers from the Rochester Police Department and troopers from the New York State Police conducted a traffic stop of a car defendant was driving on East Main Street in Rochester. As officers spoke with Payne, they smelled alcohol coming from inside the car, and also noticed a black semiautomatic handgun on the driver’s floor. The officers seized the loaded handgun, which had been reported stolen in Pennsylvania.
Payne was convicted in federal court in February 2012 of possessing a firearm in furtherance of a drug trafficking crime, and was under the supervision of the United States Probation Department at the time of this arrest. As a result, he is legally prohibited from possessing firearms and ammunition.
The matter was brought by the United States Attorney’s Office as part of its Project Safe Neighborhoods (PSN) initiative. PSN is 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 sentencing is the result of an investigation by the Rochester Police Department, under the direction of Chief Cynthia Herriott-Sullivan; the New York State Police, under the direction of Major Barry Chase; and the Bureau of Alcohol, Tobacco, Firearms, and Explosives, under the direction of Special Agent-in-Charge John B. Devito, New York Field Division.
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Federal Judge Hands Down 30-Month Prison Sentence to Charlotte-Area Tax Return Preparer Convicted of Filing False Income Tax ReturnsRead the Press Release
CHARLOTTE, N.C. – U.S. District Judge Max O. Cogburn, Jr. sentenced late yesterday former tax return preparer, Aminta Smith, 34, of Charlotte, to 30 months in prison, followed by one year of supervised release, announced William T. Stetzer, Acting U.S. Attorney for the Western District of North Carolina. Judge Cogburn also ordered Smith to pay $171,017 as restitution. In May 2019, a federal jury convicted Smith of filing false tax returns for her clients and herself.
Brian G. Thomas, Acting Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division (IRS-CI), Charlotte Field Office, joins Acting U.S. Attorney Stetzer in making today’s announcement.
According to the sentencing hearing, court documents and evidence presented at trial, Smith owned and operated a Charlotte-based tax preparation business, Touch by Angels Tax Services, also known as Touch by Angels Accounting Services and Smith Tax & Insurance Group, LLC. According to court records, between 2011 to 2016, Smith prepared fraudulent income tax returns for clients that claimed false education credits, false W-2 wages, and false Schedule C businesses to inflate the refunds paid by the IRS. In addition to filing fraudulent income tax returns for her clients, Smith falsified her own income tax returns by underreporting the fees she earned in her tax preparation business for tax years 2011 to 2015, and in some years failing to disclose that she was in engaged in the operation of a tax preparation business. In total, Smith caused more than $1 million in tax loss to the IRS.
In May 2019, a federal jury convicted Smith of aiding and assisting in the filing of false tax returns and filing false tax returns for herself. Following the sentencing hearing, Smith was released on bond and will be ordered to report to the federal Bureau of Prisons upon designation of a federal facility.
In making today’s announcement Acting U.S. Attorney Stetzer commended special agents of IRS-Criminal Investigation for their investigation of the case.
Assistant U.S. Attorney Caryn Finley of the U.S. Attorney’s Office in Charlotte prosecuted the case. Acting U.S. Attorney Stetzer also thanked the Department of Justice’s Tax Division for their invaluable assistance in this case.
Federal Contractor Indicted for Stealing over $1.2 Million from the U.S. Postal ServiceRead the Press Release
A federal grand jury indicted a construction contractor for stealing over $1.2 million from the United States Postal Service through a more than three-year scheme to defraud through false invoices, Acting United States Attorney Saima S. Mohsin announced today.
Mohsin was joined in the announcement by Steven Suller, Director of the Contract Fraud Investigations Division, United States Postal Service, Office of Inspector General.
Michael Rymar, 59, of Rochester Hills, stands charged with embezzling government funds from the United States Postal Service (USPS). From 2015 to 2018, USPS engineers awarded Rymar’s company, Horizons Materials & Management LLC, with over $5 million in contracts for repairs on USPS buildings in Michigan and New York. But the documentation Rymar provided contained false and fraudulent statements, oftentimes dramatically and falsely overstating the amount he paid subcontractors to complete the repairs. Rymar also falsely inflated the amount he paid his own employees and the cost of materials on USPS jobs. Over the course of the three-plus year fraudulent scheme, Rymar stole over $1.2 million from USPS out of the $5 million in contracts he was awarded.
As part of the Indictment, the government is seeking recovery of at least $1.2 million in embezzled funds from Rymar.
Acting United States Attorney Mohsin stated, “Today’s indictment underscores our commitment to safeguarding taxpayer funds and to prosecute those individuals who use fraudulent schemes to line their pockets with the people’s money.”
“The U.S. Postal Service spends hundreds of millions of dollars on new construction, maintenance, and renovation of U.S. Postal Service facilities,” said Director Steven Stuller, U.S. Postal Service Office of Inspector General. “Along with the Department of Justice and our federal law enforcement partners, the USPS Office of Inspector General will aggressively investigate those who would engage in this type of harmful conduct.”
Upon conviction for a violation of Title 18, United States Code, Section 641, theft of government funds, Rymar faces a maximum of ten years in prison and a fine of up to $250,000.
An indictment is only a charge and is not evidence of guilt.
The investigation of this case was conducted by the of the United States Postal Service, Office of Inspector General. The case is being prosecuted by Assistant U.S. Attorney Steven Cares.
A federal grand jury indicted a construction contractor for stealing over $1.2 million from the United States Postal Service through a more than three-year scheme to defraud through false invoices, Acting United States Attorney Saima S. Mohsin announced today.
Mohsin was joined in the announcement by Steven Suller, Director of the Contract Fraud Investigations Division, United States Postal Service, Office of Inspector General.
Michael Rymar, 59, of Rochester Hills, stands charged with embezzling government funds from the United States Postal Service (USPS). From 2015 to 2018, USPS engineers awarded Rymar’s company, Horizons Materials & Management LLC, with over $5 million in contracts for repairs on USPS buildings in Michigan and New York. But the documentation Rymar provided contained false and fraudulent statements, oftentimes dramatically and falsely overstating the amount he paid subcontractors to complete the repairs. Rymar also falsely inflated the amount he paid his own employees and the cost of materials on USPS jobs. Over the course of the three-plus year fraudulent scheme, Rymar stole over $1.2 million from USPS out of the $5 million in contracts he was awarded.
As part of the Indictment, the government is seeking recovery of at least $1.2 million in embezzled funds from Rymar.
Acting United States Attorney Mohsin stated, “Today’s indictment underscores our commitment to safeguarding taxpayer funds and to prosecute those individuals who use fraudulent schemes to line their pockets with the people’s money.”
“The U.S. Postal Service spends hundreds of millions of dollars on new construction, maintenance, and renovation of U.S. Postal Service facilities,” said Director Steven Stuller, U.S. Postal Service Office of Inspector General. “Along with the Department of Justice and our federal law enforcement partners, the USPS Office of Inspector General will aggressively investigate those who would engage in this type of harmful conduct.”
Upon conviction for a violation of Title 18, United States Code, Section 641, theft of government funds, Rymar faces a maximum of ten years in prison and a fine of up to $250,000.
An indictment is only a charge and is not evidence of guilt.
The investigation of this case was conducted by the of the United States Postal Service, Office of Inspector General. The case is being prosecuted by Assistant U.S. Attorney Steven Cares.
Erie Man Admits Selling Fentanyl that Caused an Overdose DeathRead the Press Release
ERIE, Pa. - A former resident of Erie, Pennsylvania, pleaded guilty in federal court to a charge of violating federal drug laws, Acting United States Attorney Stephen R. Kaufman announced today.
Derrick Lamont Hemphill, Sr., 30, pleaded guilty to one count of possession with intent to distribute a mixture and substance containing a detectable amount of fentanyl before United States District Judge David S. Cercone.
In connection with the guilty plea, Hemphill acknowledged that he sold fentanyl that caused the death of K.A.J. on November 26, 2017. The indictment also alleged that on November 26, 2017, Hemphill possessed with intent to distribute fentanyl and a heroin/fentanyl mixture.
Judge Cercone scheduled sentencing for August 9, 2021 at 1:00 p.m. The law provides for a total sentence of 20 years in prison, a fine of $1,000,000, 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.
Assistant United States Attorney Paul S. Sellers is prosecuting this case on behalf of the government.
The Erie County District Attorney’s Office County Detective Bureau, the Erie County District Attorney’s Office Drug Task Force, the Millcreek Township Police Department, and the Erie Police Department, with assistance from the Drug Enforcement Administration conducted the investigation that led to the prosecution of Hemphill.
Discord user pleads guilty to distributing child pornography involving infants and toddlersRead the Press Release
CORPUS CHRISTI, Texas – A 24-year-old Corpus Christi man has admitting to sending videos depicting the sexual exploitation of children, announced Acting U.S. Attorney Jennifer B. Lowery.
In August 2020, authorities had linked Krystian Dari Ayala to a Discord account found to be sending child pornography. Discord is an application where users can chat, send pictures and videos to others and allows them to join chat rooms for specific topics.
The investigation resulted in a search of Ayala’s Discord account. It confirmed he had sent videos of child pornography to other Discord users. The investigation led authorities to Corpus Christi residence where they conducted a search and seized numerous electronic devices, some of which contained child pornography.
Ayala admitted he had utilized his cellphone to access the Discord application to distribute child pornography, some of which depicted the sexual abuse of infants and toddlers.
Sentencing has been set for June 16 before U.S. District Judge Nelva Gonzales Ramos. At that time, Ayala faces a mandatory minimum of five and up to 20 years in federal prison as well as a possible $250,000 maximum fine.
Ayala has been and will remain in custody pending that hearing.
The Washington State Police, Corpus Christi Police Department Internet Crimes Against Children Task Force and Homeland Security Investigations conducted the investigation.
Assistant U.S. Attorney Sara Popejoy is prosecuting the case which was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about PSC, please visit DOJ’s PSC page. For more information about internet safety education, please visit the resources tab on that page.
Cranston Man Admits Incinerating Providence Police Cruiser During Providence RiotRead the Press Release
PROVIDENCE – A Cranston man admitted to a federal court judge today that he sprayed a flammable liquid into a Providence Police Department cruiser causing a fire to intensify and destroy the vehicle moments after he and others unsuccessfully attempted to flip-over the cruiser during the June 2020 riots in downtown Providence.
Nicholas L. Scaglione, 31, admitted to the court that he climbed on top of the unoccupied marked Providence Police cruiser, threw an object at the vehicle, joined with others in an unsuccessful attempt to flip it onto its side, and then ultimately sprayed a flammable liquid into the cruiser.
Scaglione admitted that after another individual had poured an accelerant into the passenger side of the vehicle and applied a flame to the accelerant with only minimal success in starting a fire, Scaglione then sprayed a flammable liquid accelerant into the passenger compartment. Soon after, flames engulfed and destroyed the vehicle, rendering it unrecognizable.
According to information presented to the court, the FBI, Rhode Island State Police, and Providence Police, used a variety of investigative methods to identify Scaglione and determine the specifics of his crime,, including a review of video taken at the scene, witness statements, and cellphone records including text messages from Scaglione admitting that he burned the police cruiser. Scaglione said he did so because of anger towards law enforcement, and that he was willing to do it again.
Appearing today before U.S. District Court Judge Mary S. McElroy, Scaglione pleaded guilty to malicious attempt to damage or destroy a vehicle, announced Acting United States Attorney Richard B. Myrus, Special Agent in Charge of the FBI Boston Division Joseph R. Bonavolonta, Superintendent of the Rhode Island State Police Colonel James M. Manni, and Providence Police Chief Colonel Hugh T. Clements, Jr.
Scaglione is scheduled to be sentenced on June 16, 2021.
Attempted malicious destruction of a vehicle by fire is punishable by a statutory penalty of up to twenty years in federal prison, with a mandatory minimum term of five years of imprisonment, and a term of supervised release of three years.
The case is being prosecuted by Assistant U.S. Attorney Paul F. Daly, Jr.
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Crack ring indicted for selling drugs in Galveston CountyRead the Press Release
GALVESTON, Texas – Seven members of a local drug distribution ring will now face federal charges for the preparation and sale of cocaine base to residents of La Marque and Texas City, announced Acting U.S. Attorney Jennifer B. Lowery.
Authorities arrested Smith Henry Jones, 40, and wife Lekisha Marie Jones, 42, both of Houston; and Harold Damon Brown, 43, and Dejon Nicole Thomas, 38; both of La Marque, today. They are expected to make their initial appearances before U.S. Magistrate Judge Sam Sheldon in Houston as early as 2 p.m. today.
Latoya Vonea Worthy, 30, La Marque, is also charged. Shane Alan Flores, 39, League City, was previously in custody and appeared via Zoom today. He is set for a detention hearing before U.S. Magistrate Judge Andrew Edison March 29 at 2 p.m. Ronnie LaShawn Allen, 41, Hitchcock; was also in custody and will be transferred to face the charges in this indictment in the near future.
A federal grand jury returned the seven-count indictment under seal March 16, which was unsealed today. It alleges all seven individuals conspired to possess with intent to distribute cocaine powder and crack between Feb. 16, 2017, and Feb. 26, 2019. Five of the counts allege Allen and Thomas possessed with intent to distribute either cocaine or crack. The Joneses are also charged with conspiracy to commit money laundering.
All face a minimum of 10 years and up to life in federal prison as well as a possible $10 million maximum fine if convicted in the conspiracy. Those charged with the substantive drug counts could also receive up to 20 years and another $1 million maximum fine. The money laundering conspiracy carries a potential punishment of 20 years and a fine not to exceed $500,000 or twice the value of the property involved in the transaction.
The FBI conducted the investigation as part of the Coastal Safe Streets Task Force with the assistance of the LaMarque Police Department. Assistant U.S. Attorney Kenneth Cusick is prosecuting this case.
An indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.
Columbus Resident Pleads Guilty to Robbing Wells Fargo BankRead the Press Release
COLUMBUS, Ga. – The man who robbed a Columbus Wells Fargo bank is facing a maximum 20 years in prison for his crime, said Peter D. Leary, the Acting U.S. Attorney for the Middle District of Georgia.
Emory Fredrick, 57, of Columbus, pleaded guilty to one count bank robbery before U.S. District Judge Clay D. Land on Tuesday, March 23. Fredrick is facing a maximum 20 years imprisonment to be followed by three years of supervised release and a $250,000 fine. There is no parole in the federal system. Sentencing has been scheduled for July 14, 2021 in Columbus, Georgia.
“Robbing banks puts employees, community members and even the bank robber in danger. Such actions will not be tolerated,” said Acting U.S. Attorney Leary. “I want to thank the Columbus Police Department and the FBI for quickly apprehending the defendant and helping restore order to the Columbus community.”
“Fredrick's actions traumatized both bank employees and customers,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “Thanks to the FBI, Columbus Police Department and the public he was apprehended quickly and unable to threaten anyone else.”
“I am pleased with the successful prosecution of this case and I really appreciate the dedicated work of our officers and FBI. We will continue our partnership as we work to make Columbus a safe place to live,” said Chief Freddie Blackmon, Columbus Police Department.
On March 11, 2019, Fredrick entered the Wells Fargo Bank at 5538 Whittlesey Boulevard in Columbus, Georgia. He walked up to a teller and said, “This is a stickup.” Fredrick then instructed the teller to give him all large bills. The teller believed that Fredrick could have been armed because he kept messing with one of his pockets. The defendant collected the money into a grey bag he brought, a total of $1138, and walked out of the bank. The Columbus Police Department and FBI apprehended Fredrick within a few hours of the robbery, utilizing both images captured on security cameras at the scene as well as photos and verbal descriptions from bystanders leading to his quick capture.
The case was investigated by the Columbus Police Department and FBI. Assistant U.S. Attorney Amy Helmick is prosecuting the case for the Government. Questions can be directed to Pamela Lightsey, Public Information Officer, United States Attorney’s Office, at (478) 621-2603 or Melissa Hodges, Public Affairs Director (Contractor), United States Attorney’s Office, at (478) 765-2362.
Clarksburg man indicted on firearms chargeRead the Press Release
CLARKSBURG, WEST VIRGINIA – Christopher M. Vickers, of Clarksburg, West Virginia, appeared today before a federal magistrate judge on a firearms charge after being indicted last week, Acting United States Attorney Randolph J. Bernard announced.
Vickers, 31, was indicted on one count of “Unlawful Possession of a Firearm.” Vickers, a person prohibited from having a firearm because of a prior drug conviction, is accused of having a 5-shot revolver in June 2020 in Harrison County.
Vickers faces up to 10 years of incarceration and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Christopher L. Bauer is prosecuting the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Shinnston Police Department investigated.
An indictment is merely an accusation. A defendant is presumed innocent unless and until proven guilty.
U.S. Magistrate Judge Michael John Aloi presided.
Cedar Rapids Man Sentenced to Federal Prison for Possessing Drugs and Guns Near a SchoolRead the Press Release
A Cedar Rapids man, responsible for possessing over 130 grams of marijuana and two guns near a Cedar Rapids school, was sentenced today to 61 months in prison.
Sinqez Juanya Ray, age 19, from Cedar Rapids, Iowa, received the prison sentence after an October 21, 2020 guilty plea to possession with intent to distribute a controlled substance and possession of a firearm in furtherance of a drug trafficking crime.
Information disclosed at sentencing and at his plea hearing showed that in February 2020, Ray was stopped by Cedar Rapids police officers while he was walking near Prairie Ridge Elementary School and Kirkwood Community College. Ray was wearing a backpack. Officers immediately observed the magazine of a firearm and marijuana sticking out of the backpack. Officers searched the backpack and located 139.4 grams of marijuana, a ski mask, digital scales, and two guns, one of which was loaded. Ray admitted that he planned to sell the marijuana and that he carried the firearms in furtherance of his drug distribution activities. Ray has two prior weapons convictions, both from 2019.
Ray was sentenced in Cedar Rapids by United States District Court Judge C.J. Williams. Ray was sentenced to 61 months’ imprisonment. He was ordered to make payment of $200 to the special assessment fund. He must also serve a 3-year term of supervised release after the prison term. There is no parole in the federal system.
The case was prosecuted by Assistant United States Attorney Ashley Corkery and investigated by the Cedar Rapids Police Department and the Bureau of Alcohol, Tobacco, Firearms, and Explosives.
This case was brought as part of Project Safe Neighborhoods (PSN). PSN is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
This case is also part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see /media/1122011/dl?inline.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 20-CR-31.
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Brockton Man Pleads Guilty to Fentanyl TraffickingRead the Press Release
BOSTON – A Brockton man pleaded guilty today to distributing fentanyl throughout southeastern Massachusetts.
Eric Marques, 29, pleaded guilty to one count of distribution and possession with intent to distribute 40 grams or more fentanyl. U.S. District Court Judge Patti B. Saris scheduled sentencing for July 14, 2021.
In 2019 and 2020, law enforcement conducted an investigation into fentanyl traffickers operating in southeastern Massachusetts. A cooperating witness and undercover police officer purchased a total of 180 grams of fentanyl and 260 pressed fentanyl pills from Marques. Marques was arrested on March 16, 2020. A search of residences tied to Marques in Brockton and Bridgewater resulted in the seizure of $10,700 in cash, bags of fentanyl, a digital scale and other drug packaging materials.
The charging statute provides for a mandatory minimum sentence of five years and up to 40 years in prison, at least four years and up to life of supervised release and a fine of up to $5 million. Sentences are imposed by a federal district court judge based on the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney Nathaniel R. Mendell; William S. Walker, Acting Special Agent in Charge of Homeland Security Investigations in Boston; Colonel Christopher Mason, Superintendent of the Massachusetts State Police; Brockton Police Chief Emanuel Gomes; East Bridgewater Police Chief Paul O’Brien; John Gibbons, U.S. Marshal for the District of Massachusetts; and Plymouth County District Attorney Timothy Cruz made the announcement today. Assistant U.S. Attorney Christopher Pohl of Mendell’s Narcotics and Money Laundering Unit is prosecuting the case.
The remaining defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Armed Career Criminal Convicted of Drug Trafficking and Firearms OffensesRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced that James Larnerd, age 47, of Lebanon, Pennsylvania, was convicted yesterday by a federal jury for possession with the intent to distribute methamphetamine; for being a previously convicted felon in possession of a firearm; and maintaining a drug involved premises, after a three-day trial held before United States District Court Judge Jennifer Wilson. Larnerd faces a potential 15 year mandatory minimum sentence as a result of three prior convictions for serious drug offenses.
According to Acting United States Attorney Bruce D. Brandler, the jury returned the guilty verdict after approximately two hours of deliberation. The evidence at trial showed that during May of 2019, the North Cornwall Township Police received information that Larnerd was selling drugs and possessed firearms at his residence in Lebanon County. Based on that information, the North Cornwall Police applied for and obtained a search warrant for Larnerd’s residence in June 2019.
During execution of the warrant, the police found a Highpoint 9mm C9 Luger handgun in Larnerd’s second floor bedroom, and a Highpoint Model CF380 ACP handgun in a downstairs closet. There were also small amounts of marijuana and methamphetamine scattered about the house. Witnesses testified that Larnerd sold them methamphetamine from the residence and possessed the firearms.
The case was investigated by the North Cornwall Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorneys Johnny Baer and Christian Haugsby are prosecuting the case.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law for this offense is a term of life imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant. Larnerd’s conviction for illegal firearm possession carries a 15-year mandatory sentence.
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Alien Pleads Guilty to Transporting and Harboring Illegal AliensRead the Press Release
Jackson, Miss. – Dennis Omar Escobar-Castro, age 29, a Honduran national, pled guilty today before U.S. District Judge Carlton Reeves to transporting and harboring illegal aliens, announced Acting United States Attorney Darren J. LaMarca and Jack P. Stanton, Acting Special Agent in Charge of Homeland Security Investigations (HSI), New Orleans Field Office.
“Interstate human trafficking remains a major threat,” said Acting U.S. Attorney Darren LaMarca. “These arrests affirm the Department of Justice’s commitment to prosecuting those who prey on the desperate and vulnerable to exacerbate violations of our immigration laws.”
On March 19, 2019, Escobar-Castro was traveling eastbound on Interstate I-20 in a Chevy Suburban when a Rankin County Sheriff’s Deputy made a traffic stop for careless driving. Escobar-Castro could produce no driver’s license, and none of the eleven passengers had identification or driver’s licenses, other than South American IDs. HSI agents interviewed Escobar-Castro and the eleven passengers. Escobar-Castro admitted that he believed all his passengers were foreign nationals and that he had been driving them from Houston, Texas, to Atlanta, Georgia to take them to work.
Escobar-Castro was charged in a federal criminal indictment on April 16, 2019 with transporting and harboring aliens. During his guilty plea hearing today, Escobar-Castro admitted to being paid for driving the passengers whom he knew to be aliens unlawfully present in the United States.
Escobar-Castro will be sentenced by Judge Reeves on July 8, 2021 and faces a maximum penalty of 20 years in prison and a $250,000 fine.
Acting U.S. Attorney LaMarca commended the work of the Special Agents with HSI’s Jackson Division who investigated the case, and the Rankin County Sheriff’s Office who assisted with the discovery and arrest of defendants. The case is being prosecuted by Assistant United States Attorney Theodore Cooperstein.
Additional Charges for Fresno Man for Illegal Possession of a Machine Gun and AmmunitionRead the Press Release
FRESNO, Calif. — A federal grand jury returned a three-count superseding indictment today against Steven Eric Cabrera, 25, of Fresno, adding one count of illegally possessing a machine gun and one count of being a felon in possession of ammunition to the original Feb. 11 indictment that charged him with one count of being a felon in possession of a firearm, Acting U.S. Attorney Phillip A. Talbert announced.
According to court documents, in 2017, Cabrera was convicted of assaulting a person with a firearm, a felony that makes it illegal for him to possess firearms or ammunition. In May 2020, he possessed a firearm that was hidden wrapped in a towel in a bag inside a car. About nine months later, he possessed a handgun that had been converted into a machine gun and over 300 rounds of ammunition.
This case is the product of an investigation by the Federal Bureau of Investigation and the Fresno Police Department. Assistant U.S. Attorney Justin J. Gilio is prosecuting the case.
If convicted, Cabrera faces a maximum statutory penalty of 10 years in prison and a $250,000 fine for each count. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally based strategies to reduce violent crime. To learn more about Project Safe Neighborhoods, go to www.justice.gov/psn.
Acting U.S. Attorney Phil Talbert offers a statement of support for the Asian American Pacific Islander Community (AAPI) amidst rising Anti-AAPI hate crimes and incidents.Read the Press Release
Acting U.S. Attorney Phillip A. Talbert and FBI Sacramento Field Office Special Agent in Charge Sean Ragan condemn racism, xenophobia, and intolerance against Asian Americans and Pacific Islanders and urge members of the community to report hate-based crimes and incidents to law enforcement. The Eastern District of California is one of the most diverse regions in the country, and federal law enforcement is committed to protecting our diverse communities.
“We stand together with the Asian American and Pacific Islander community during this difficult time. Acts of hate and racism have no place in our community and will not be tolerated,” said Acting U.S. Attorney Talbert. “We want to ensure that all those who call this region their home feel safe regardless of their race, ethnic origin, color, religion, gender, sexual orientation, or disability. Prosecuting hate crimes continues to be a top priority for our office and our law enforcement partners and our Hate Crimes Task Forces remain active. If you see something, please say something by contacting law enforcement so that we can do everything we can to help stop hate crime and protect the community.”
The United States Attorney’s Office has been in regular and ongoing contact with Asian American and Pacific Islander community leaders and our local and federal law enforcement partners regarding potential hate crimes directed at persons of Asian descent. Tonight, Acting U.S. Attorney Talbert will be joining other federal and local law enforcement leaders and elected representatives to speak at a town hall to address anti-Asian hate crimes. Acting U.S. Attorney Talbert also released a Public Service Announcement encouraging community members to report hate crimes and incidents: https://www.justice.gov/usao-edca/pr/acting-us-attorney-phil-talbert-offers-statement-support-asian-american-pacific.
“The FBI has been reaching out to and working with the API community to increase understanding of our role in investigating hate crime, encourage reporting of hate crimes, and continue to increase diversity and inclusion within our work force,” said Special Agent in Charge Ragan. “A criminal act committed against a person because of their ethnicity or national origin is a hate crime. Such investigations are a high priority for the FBI’s civil rights program because of the profound and lasting impact such acts have on entire communities. We affirm our commitment to thoroughly investigating the facts of alleged hate crimes and continue to work closely with our law enforcement partners and the U.S. Attorney’s Office to ensure offenders face justice.”
If you are a victim of a hate crime and are in immediate danger, call 911 first. Once you are safe, please also report the hate crime to the FBI by calling 916-746-7000. This FBI tip line offers language translation services in many languages spoken in our region, including Chinese, Korean, Tagalog, and Vietnamese. When calling, please provide basic information to help us investigate— the who, what, when, where, and why. If you wish, you can make your tip anonymously.
24 March 2021
Zuni man pleads guilty in federal court to sexual abuse of a child in Indian CountryRead the Press Release
ALBUQUERQUE, N.M. – Byron Calavaza, 33, of Zuni, New Mexico, and an enrolled member of the Pueblo of Zuni, pleaded guilty March 23 in federal court to four counts of committing sexual abuse of a minor in Indian Country.
According to the plea agreement, Calavaza sexually abused the victim between Dec. 25, 2017, and Jan. 21, 2018, at a home on the Pueblo of Zuni. Calavaza admitted in the plea agreement to committing intentional and unlawful sexual abuse of the victim, who was between the age of twelve and fifteen, with the intent to gratify his sexual desires.
Calavaza is currently in custody awaiting sentencing. He faces five years in prison under the terms of his plea agreement. Additionally, should the court accept the plea agreement, Calavaza will be required to register as a sex offender upon his release from prison.
The Zuni Police Department investigated the case. Assistant U.S. Attorney Novaline D. Wilson is prosecuting the case.
Waterbury Felon Sentenced to 42 Months in Prison for Possessing Handgun on Federal Supervised ReleaseRead the Press Release
Leonard C Boyle, Acting United States Attorney for the District of Connecticut, announced that DESI WILLIAMS, 40, of Waterbury, was sentenced today by U.S. District Judge Janet C. Hall in New Haven to 42 months and one day of imprisonment, followed by three years of supervised release, for illegally possessing a firearm while on federal supervised release.
According to court documents and statements made in court, in the afternoon of January 28, 2019, Waterbury Police officers attempted to stop a car Williams was driving at the intersection of Brass Mill Drive and Union Street for motor vehicle violations. When an officer approached the car on foot, Williams accelerated and fled from the scene. During a subsequent pursuit, Williams rammed three police vehicles before crashing his car into a utility pole on Walnut Street. Williams ran from the car, jumped over a fence and was eventually apprehended on Ives Street. A search of Williams’s car revealed a loaded Smith & Wesson .22 caliber revolver.
In 2016, Williams was convicted in federal court of possession of a firearm by a convicted felon, and he was on federal supervised release in January 2019. Prior to 2016, Williams was convicted in state court of felony robbery, burglary and failure to appear offenses.
Williams has been detained since January 28, 2019. On June 11, 2020, he pleaded guilty to possession of a firearm by a convicted felon.
Judge Hall sentenced Williams to 30 months of imprisonment for the new firearm offense, and a consecutive 12 months and one day of imprisonment for violating the conditions of his supervised release.
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Waterbury Police Department. This case was prosecuted by Assistant U.S. Attorneys Jocelyn Courtney Kaoutzanis and Peter D. Markle.
This prosecution has been brought through Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make neighborhoods safer for everyone.
Valley felon headed back to prison for alien smuggling and firearmsRead the Press Release
McALLEN, Texas – A 46-year-old Edinburg resident has been ordered to federal prison for conspiring to harbor illegal aliens and possessing a firearm as a convicted felon, announced Acting U.S. Attorney Jennifer B. Lowery.
Noe Garza pleaded guilty Nov. 2, 2020.
Today, U.S. District Judge Micaela Alvarez ordered Garza to serve a total of 63 months in federal prison to be immediately followed by three years of supervised release. At the hearing, the court heard additional information related to his criminal record to include prior convictions for aggravated assault and aggravated robbery. In handing down the sentence, Judge Alvarez noted Garza had been breaking the law since he was 17. She added that she was particularly troubled Garza committed these crimes while having a pending alien transportation case from 2016 and failed to appear for sentencing.
On Feb. 28, 2020, law enforcement conducted a traffic stop on Garza, but he fled the scene. Authorities soon apprehended him, at which time he admitted to being the caretaker of a stash house in Edinburg and helping coordinate transportation of illegal aliens further north. A search of the residence revealed five illegal aliens and two firearms. Law enforcement also found an additional firearm in the area of the traffic stop. Garza took ownership of all three firearms.
As a previously convicted felon, federal law prohibits him of possessing firearms or ammunition.
He has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the future.
Immigration and Customs Enforcement’s Homeland Security Investigations and the Bureau of Alcohol, Tobacco, Firearms and Explosives conducted the investigation with the assistance of the Edinburg Police Department. Assistant U.S. Attorney M. Alexis Garcia prosecuted the case.
Two Raleigh Men Pled Guilty to Bank FraudRead the Press Release
RALEIGH, N.C. –Rahne Cooper, age 31, and Darius Hinton, age 31, pled guilty to bank fraud before Magistrate Judge Robert T. Numbers, III, in federal District Court today.
Both men admitted using synthetic identities to obtain loans from financial institutions. A synthetic identity, often referred to as a CPN or credit privacy number, looks like a nine-digit social security number. Often, the CPN was actually issued by the Social Security Administration to a real individual. Individuals with poor credit scores use CPNs to build fresh credit by adding the CPN to their names and dates of birth. To enhance the credit worthiness, the new credit profile is added as authorized users on credit accounts belonging to individuals with good credit.
Cooper used a synthetic identity to finance the purchase of a car and Hinton used one to purchase John Deere lawn equipment from Quality Equipment. Each man faces a maximum penalty of 30 years’ in prison, a $1,000,000 fine, restitution and forfeiture.
Cooper and Hinton were charged along with Durham Attorney Tiffany Russell in a 26-count Indictment. Russell’s arraignment is scheduled for the May 17, 2021 term of court before District Judge James C. Dever III.
G. Norman Acker, III, Acting U.S. Attorney for the Eastern District of North Carolina made the announcement. The Federal Bureau of Investigation, Internal Revenue Service Criminal Investigation, Social Security Administration, and Raleigh Police Department have jointly investigated the case and Assistant U.S. Attorney Susan Menzer is prosecuting the case.
Two Luzerne County Men Indicted for Fentanyl TraffickingRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Lee Crawford, age 59, of Wilkes-Barre, Pennsylvania and John Williams, age 41, of Kingston, Pennsylvania, were indicted on March 23, 2021, by a federal grand jury for conspiring to distribute more than 40 grams of fentanyl in Luzerne County.
According to Acting United States Attorney Bruce D. Brandler, the indictment alleges that Crawford and Williams conspired to distribute more than 40 grams of fentanyl in the Luzerne County area between July 2020 and February 2021. The indictment also charges Crawford with nine counts of distributing fentanyl and charges Williams with one count of distributing fentanyl.
The case was investigated by the Kingston Police Department, the Bureau of Alcohol Tobacco and Firearms, and the Luzerne County Drug Task Force. Assistant United States Attorney Robert J. O’Hara is prosecuting the case.
This case is part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local and tribal enforcement and the local community to develop effective, locally-based strategies to reduce crime.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
Under federal law, Crawford faces a mandatory minimum sentence of ten years in prison, up to a maximum sentence of life in prison, a term of supervised release following imprisonment, and a fine. Williams faces a mandatory minimum sentence of five years in prison, up to a maximum sentence of forty years in prison, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Texas Man Pleads Guilty to $24 Million COVID-Relief Fraud SchemeRead the Press Release
A Texas man pleaded guilty today to orchestrating a fraudulent scheme to obtain approximately $24.8 million in forgivable Paycheck Protection Program (PPP) loans and laundering the proceeds.
According to court documents, Dinesh Sah, 55, of Coppell, admitted that he submitted 15 fraudulent applications, filed under the names of various purported businesses that he owned or controlled, to eight different lenders seeking approximately $24.8 million in PPP loans. Sah claimed that these businesses had numerous employees and hundreds of thousands of dollars in payroll expenses when, in fact, no business had employees or paid wages consistent with the amounts claimed in the PPP applications. Sah further admitted that he submitted fraudulent documentation in support of his applications, including fabricated federal tax filings and bank statements for the purported businesses, and falsely listed other persons as the authorized representatives of certain of these businesses without the authority to use their identifying information on the applications.
“As the nation was crippled by a global pandemic, Sah fraudulently obtained over $17 million in PPP funds intended to help legitimate small businesses and spent that money on luxury cars and multiple homes,” said Acting Assistant Attorney General Nicholas L. McQuaid of the Justice Department’s Criminal Division. “As our nation continues to fight this unprecedented virus, the Department of Justice and its law enforcement partners remain committed to aggressively pursuing individuals who exploit COVID-relief programs and to ensuring that these ill-gotten gains are returned.”
“The Paycheck Protection Program was designed to aid struggling business owners, not to line the pockets of crafty profiteers,” said Acting U.S. Attorney Prerak Shah of the Northern District of Texas. “Even as fellow businesspeople tried desperately to procure the funds they needed to keep their business afloat, Sah dipped into federal coffers to fund his lavish lifestyle. The Justice Department is committed to protecting the PPP from fraud and deceit.”
“We will continue to vigorously investigate cases involving attempts to defraud the Paycheck Protection Program and other crimes against the financial institutions the FDIC insures and regulates,” said Special Agent in Charge Anand M. Ramlall of the Federal Deposit Insurance Corporation – Office of Inspector General (FDIC-OIG). “Sah’s egregious fraud committed to fund his luxurious lifestyle is unacceptable under any circumstances, but especially so when done against a program designed to help Americans recover from the ongoing pandemic. We appreciate the cooperation and coordination of our law-enforcement partners on these types of investigations.”
Sah admitted that, based on his false statements and fabricated documents, he received over $17 million in PPP loan funds and diverted the proceeds for his personal benefit, using them to purchase multiple homes in Texas, pay off the mortgages on other homes in California, and buy a fleet of luxury cars, including a Bentley convertible, Corvette Stingray, and Porsche Macan. Sah also sent millions of dollars in PPP proceeds in international money transfers. As part of his guilty plea, Sah agreed to forfeit, among other property, eight homes, numerous luxury vehicles, and more than $7.2 million in fraudulent proceeds that the government has seized to date.
Sah pleaded guilty to one count of wire fraud and one count of money laundering in the Northern District of Texas. He will be sentenced at a later date and faces a maximum penalty of 30 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
The Dallas Field Offices of the FDIC-OIG, IRS-Criminal Investigation, and U.S. Treasury Inspector General for Tax Administration are investigating the case.
Assistant Deputy Chief Anna G. Kaminska of the Criminal Division’s Fraud Section and Section Chief Katherine Miller of the U.S. Attorney’s Office for the Northern District of Texas are prosecuting the case. Assistant U.S. Attorneys Erica Hilliard and Dimitri Rocha are handling the asset-forfeiture component of the case.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses, through the PPP. In April 2020, Congress authorized over $300 billion in additional PPP funding.
The PPP allows qualifying small businesses and other organizations to receive loans with a maturity of two years and an interest rate of 1%. PPP loan proceeds must be used by businesses on payroll costs, interest on mortgages, rent, and utilities. The PPP allows the interest and principal on the PPP loan to be forgiven if the business spends the loan proceeds on these expense items within a designated period of time after receiving the proceeds and uses at least a certain percentage of the PPP loan proceeds on payroll expenses.
The Fraud Section leads the Department of Justice’s prosecution of fraud schemes that exploit the CARES Act. In the months since the CARES Act was passed, Fraud Section attorneys have prosecuted more than 100 defendants in more than 70 criminal cases. The Fraud Section has also seized more than $65 million in cash proceeds derived from fraudulently obtained PPP funds, as well as numerous real-estate properties and luxury items purchased with such proceeds. More information can be found at: https://www.justice.gov/criminal-fraud/cares-act-fraud.
Anyone with general information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
Sumrall Man Sentenced for Tax FraudRead the Press Release
Gulfport, Miss. – Charles Chandler Smith, 43, of Sumrall, Mississippi, was sentenced today by U.S. District Judge Keith Starrett to five years’ probation for filing a false tax return, announced Acting U.S. Attorney Darren J. LaMarca and Special Agent in Charge James E. Dorsey of the Internal Revenue Service Criminal Investigation, Atlanta Field Office. Smith was also ordered to pay a $494,444 in restitution.
Smith pled guilty before Judge Starrett on December 14, 2020. According to the facts revealed at this plea hearing, Smith took advantage of a tax deduction strategy suggested by a financial adviser to deduct money on his tax return and thereby reduce his taxable income. Smith admitted to transferring a total of $1,305,090 from an account held by his business, Lil Mad, to another company and falsely claiming it as a business expense deduction on his 2014 tax return. Smith falsely claimed that his income with Lil Mad was only $143,070. Smith admitted to knowing this act was unlawful or deliberately blinded himself to suspicious aspects of the deduction, particularly the fact that the money was soon transferred back to an account that was available to Smith for his personal use.
The case was investigated by IRS Criminal Investigation and the FBI. It was prosecuted by DOJ Health Care Fraud Trial Attorney Sara Porter and Assistant U.S. Attorney Kathlyn R. Van Buskirk.