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Thursday 28 January 2021
Justice Department Seeks to Shut Down Southern Florida Tax Return PreparerRead the Press Release
The United States has filed a complaint in the U.S. District Court for the Southern District of Florida seeking to bar a Belle Glade, Florida, tax return preparer from owning or operating a tax return preparation business and preparing tax returns for others, the Justice Department announced today.
The civil suit against Brandhi Shaw alleges that Shaw prepares returns claiming false refundable fuel credits and American Opportunity tax credits. In addition, the complaint alleges that Shaw prepares returns claiming fabricated businesses income and/or expenses, and related fictitious losses. As a result, the complaint alleges Shaw offset the amount of taxable income reported to make it appear that her customers were entitled to earned income tax credits when they were not.
For example, the complaint alleges that Shaw prepared a return for an individual who did not own a business nor tell Shaw that he or she did. As alleged in the complaint, Shaw claimed a fabricated loss of $37,413 for the non-existent business, which fraudulently reduced the amount of the individual’s taxable income and, in return, his or her reported tax liability.
The complaint further alleges that, by repeatedly underreporting tax liabilities and claiming bogus refunds on behalf of her customers, Shaw has caused her customers to incorrectly report their federal tax liabilities and underpay their taxes, resulting in lost tax revenue to the United States that could exceed $6 million. Moreover, the complaint alleges that Shaw is not and never has been an enrolled return preparer. Rather, according to the complaint, she files tax returns using another tax preparer’s personal identifying information, which makes it difficult to determine the full extent of the harm she has caused.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams and taxpayers seeking a return preparer should remain vigilant (more information can also be found here). The IRS has information on its website for choosing a tax preparer and has launched a free directory of federal tax preparers. In addition, IRS Free File, a public-private partnership, offers free online tax preparation and filing options on IRS partner websites for individuals whose adjusted gross income is under $72,000. For individuals whose income is over that threshold, IRS Free File offers electronical federal tax forms that can be filled out and filed online for free.
In the past decade, the Justice Department's Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Justice Department Files Civil Action to Shut Down Chicago-Area Tax Return PreparerRead the Press Release
The United States has filed a complaint seeking to bar a Chicago-area tax return preparer from preparing federal income tax returns for others, the Justice Department announced today.
The civil complaint against Lavon Boyd was filed in the U.S. District Court for the Northern District of Illinois and alleges that Boyd prepared federal income tax returns for Chicago-area taxpayers that significantly understated his customers’ tax liabilities by fabricating business losses. The suit alleges that Boyd fabricated or exaggerated his customers’ business expenses. The suit also charges that Boyd allegedly fabricated child care expenses on at least one of his customers’ tax returns.
According to the complaint, the Internal Revenue Service (IRS) interviewed 15 of Boyd’s customers, each of whom stated that they did not incur the business expenses reported on their returns prepared by Boyd on their behalf, nor did they give Boyd any reason to believe that such expenses were legitimate. The complaint further alleges that, by repeatedly understating his customers’ tax liabilities, Boyd has caused the United States to lose substantial tax revenue.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams and taxpayers seeking a return preparer should remain vigilant (more information can also be found here). The IRS has information on its website for choosing a tax preparer and has launched a free directory of federal tax preparers. In addition, IRS Free File, a public-private partnership, offers free, online tax preparation and filing options on IRS-partner websites for individuals whose adjusted gross income is under $72,000. For individuals whose income is over that threshold, IRS Free File offers electronic federal tax forms that can be filled out and filed online for free.
In the past decade, the Department of Justice's Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Jury convicts Wolf Point man of rape, assault of woman on Fort Peck Indian ReservationRead the Press Release
GREAT FALLS — A federal jury today convicted a Wolf Point man of raping and assaulting a woman near Poplar on the Fort Peck Indian Reservation in 2017, Acting U.S. Attorney Leif Johnson said.
The jury found Luke John Scott, Sr., 33, guilty of aggravated sexual abuse and of assault by striking, beating or wounding, a misdemeanor. The three-day trial began on Jan. 26.
Scott faces a maximum of life in prison, a $250,000 fine and five years of supervised release.
Chief U.S. District Judge Brian M. Morris presided. Chief Judge Morris set sentencing for March 24. Scott was detained.
Scott also is pending sentencing on March 24 in a separate case for assault resulting in serious bodily injury and felony child abuse. A federal jury convicted Scott of those crimes on Nov. 19, 2020.
“Mr. Scott poses a clear danger to women in the community. Violence, including sexual violence, faced by Native American women must stop. We will prosecute those who prey on women to the full extent of the law. I want to thank Assistant U.S. Attorney Kalah Paisley, the FBI and Fort Peck Tribal Law Enforcement for investigating and prosecuting this case,” Acting U.S. Attorney Johnson said.
At trial, the prosecution presented evidence that on July 7, 2017, Scott approached the victim, identified as Jane Doe, on the street, told her he had a bottle of vodka and that a relative was fishing by the river. The victim went with Scott to the river, where he told her that another person had paid him to get rid of her. Scott tried to choked Jane Doe and then sexually assaulted her. Jane Doe reported the assault to law enforcement and was transported to the hospital in Poplar.
Assistant U.S. Attorney Kalah Paisley is prosecuting the case, which was investigated by the FBI and Fort Peck Tribal Law Enforcement.
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Jury Convicts Inmate of Attacking BOP EmployeeRead the Press Release
A federal jury has convicted a prison inmate of attacking a Bureau of Prisons employee, announced Acting U.S. Attorney for the Northern District of Texas Prerak Shah.
After just over an hour of deliberations, a jury on Tuesday found 44-year-old William Lee Terrell guilty of assault of a federal officer resulting in bodily injury.
According to evidence presented at trial, Mr. Terrell was convicted in 2010 of bank robbery and ordered to serve his 235-month sentence at FCI Big Spring. On March 23, 2019, Mr. Terrell, who was on suicide watch, was placed under the observation of Human Resource Specialist Krista Coccozza.
As HR Specialist Coccozza attempted to retrieve trash from a meal he had just eaten, Mr. Terrell reached through the food slot in the door, grabbing Specialist Coccozza. He struggled with her, attempting to free the keys to the cell attached to her belt.
Additional guards responded to Coccozza’s calls for help and they were able to eventually free the keys from Terrell and secure his cell.
Specialist Coccozza suffered a bruised lung, bruised ribs, sprained wrist, sprained elbow, sprained fingers, skin abrasions, pain, and redness on her body, and was unable to return to work for a period of time due to her injuries.
Mr. Terrell now faces up to 20 additional years in federal prison. His sentencing hearing has been set for April 29.
The Federal Bureau of Investigation conducted the investigation. Assistant U.S. Attorneys Callie Woolam and Stephen Rancourt are prosecuting the case. U.S. District Judge James Wesley Hendrix presided over the trial.
Israeli National Pleads Guilty to Bail JumpingRead the Press Release
CONCORD - Boaz BenMoshe, 58, of Israel, pleaded guilty in federal court on Wednesday to bail jumping, United States Attorney Scott W. Murray announced today.
According to court documents and statements made in court, in November 2006, a federal grand jury charged BenMoshe with conspiracy to launder monetary instruments and conspiracy to engage in unlicensed wholesale distribution of prescription drugs. After an initial appearance hearing on January 29, 2007, BenMoshe was released on conditions including his promise to notify the pretrial services officer of any plans to change his residence and to travel outside of the Central District of California and the District of New Hampshire. On January 9, 2009, BenMoshe pled guilty to conspiracy to engage in unlicensed wholesale distribution of prescription drugs. The Court accepted his guilty plea and permitted him to continue on the same conditions of release pending sentencing. The sentencing hearing was scheduled for June 23, 2009. On or about April 29, 2009, in violation of his conditions of release, BenMoshe moved to Israel and failed to appear for his sentencing hearing on June 23, 2009.
On December 16, 2009, a federal grand jury charged BenMoshe with bail jumping for his failure to appear at his sentencing hearing.
In August of 2020, BenMoshe was extradited from Israel to the United States to face the charges pending against him in New Hampshire.
BenMoshe is scheduled to be sentenced in both cases on April 1, 2021.
“This prosecution demonstrates that defendants cannot flee from the United States to escape responsibility for their crimes,” said U.S. Attorney Murray. “BenMoshe violated his promise to appear in court for sentencing and spent years avoiding the ultimate judicial reckoning for his crime. Through hard work and diligence, the U.S. Marshals located this fugitive and he was extradited back to New Hampshire to face the consequences of his 2009 guilty plea and his flight from justice. Other criminal defendants should take note that efforts to flee from justice will not succeed.”
“The arrest and subsequent extradition of BenMoshe is a testament to the collaborative work of the US Marshals Service and the US Attorney’s Office for the District of New Hampshire,” said Nick Willard, U.S. Marshal for the District of New Hampshire. “We are also grateful for the cooperation of the Israeli authorities who worked closely with the Deputy Marshals for a safe and professional transfer into our custody.”
This matter was investigated by the United States Marshals Service. The underlying criminal case was investigated by the Food and Drug Administration’s Office of Criminal Investigations, the Office of the Inspector General of the U.S. Department of Health and Human Services, and the Internal Revenue Service. The case is being prosecuted by Assistant U.S. Attorney Cam Le and Special Assistant U.S. Attorney Sarah Hawkins.
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Inmate Sentenced to Another Year for SORNA ViolationRead the Press Release
ERIE, Pa. – An inmate at the Pamunkey Regional Jail in Hanover, Virginia pleaded guilty and was sentenced in federal court to 13 months in jail on his conviction of failure to register under SORNA, United States Attorney Scott W. Brady announced today.
United States District Judge Susan Paradise Baxter imposed the sentence on Jeremy Christopher Ester, 42.
According to information presented to the court, Ester traveled from Virginia, without the permission of his probation officer, to Erie, Pennsylvania, where he stayed for months before his arrest and knowingly failed to register as a sex offender in Pennsylvania as required by the Sex Offender Registration and Notification Act.
Assistant United States Attorney Christian A. Trabold prosecuted this case on behalf of the government.
United States Attorney Brady commended the United States Marshals Service for the investigation leading to the successful prosecution of Ester.
Individual Sentenced for Postage Stamp SchemeRead the Press Release
Tampa, Florida – U.S. District Judge Thomas P. Barber has sentenced Edward Morgan (49), a/k/a Edward Croce, a/k/a Edward Carrera, to six years and six months in federal prison for theft of government funds. As part of his sentence, the court also entered a money judgment of $405,935.76, the proceeds of the theft.
Morgan had pleaded guilty on September 27, 2019.
According to court documents, beginning in November 2016 and continuing through the date of his arrest in May 2019, Morgan used fictitious checks at hundreds of United States Post Office locations in Florida and other states—Alabama, Arizona, California, Connecticut, Georgia, Illinois, Kentucky, Louisiana, Maryland, Massachusetts, Mississippi, Nevada, New Jersey, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, and Virginia—to purchase stamps. Morgan then converted the stamps to cash by reselling them to unsuspecting third parties, usually businesses or stamp traders. To further the scheme, Morgan often posed as a business professional during his visits to the post offices, wearing business attire and referencing his “job.” During the course of the scheme, Morgan used the personal identifying information of a real person, P.T. (now deceased), as well as the fictitious names Edward Carrera and Edward Croce. He stole more than $400,000 in stamps and other services from the United States Post Office.
This case was investigated by United States Postal Inspection Service. It was prosecuted by Assistant United States Attorneys Rachel K. Jones and Suzanne Nebesky.
Indictment Charges Vermilion County Man with Child Sexual Exploitation, Trafficking Child PornographyRead the Press Release
PEORIA, Ill. – A Hoopeston, Ill., man, Dalton M.C. Burmeister, 27, has been indicted on charges of child sexual exploitation and trafficking of child pornography. The indictment alleges that in September 2020, Burmeister exploited children under the age of six to engage in sexual activity and to create an image of the conduct and that he trafficked images of child pornography.
Burmeister was previously charged by criminal complaint and was arrested on Dec. 22, 2020. U.S. Magistrate Judge Eric I. Long ordered that Burmeister remain detained in the custody of the U.S. Marshals Service.
If convicted, the statutory penalty for each count of child sexual exploitation (four counts) is 15 to 30 years in prison; for distribution (three counts) and receiving (one count) child pornography, the penalty is five to 20 years in prison. For possession of child pornography (one count), the statutory penalty is up to 20 years in prison.
Assistant U.S. Attorney Elly M. Peirson represents the government in the prosecution. The charges are the result of investigation by the Illinois State Police and the Illinois Internet Crimes Against Children Task Force.
Members of the public are reminded that an indictment is merely an accusation; the defendant is presumed innocent unless proven guilty.
The case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Illinois Man Sentenced to over 21 Years in PrisonRead the Press Release
HAMMOND-Jeremiah Ellis, 34, of Blue Island, Illinois, was sentenced by United States District Court Judge Philip P. Simon following his guilty plea to Counts 1 through 5 of the Superseding Indictment, announced Acting U.S. Attorney Bell.
Mr. Ellis was sentenced to 261 months in prison followed by 3 years of supervised release
Ellis entered a guilty plea to bank robbery, discharging a firearm during a crime of violence, and brandishing a firearm during a crime of violence. According to documents in the case, on March 29, 2014, Ellis and co-defendant Ashley Patterson robbed First Merchant’s Bank in East Chicago, Indiana. Ellis and Patterson ran into the bank with their guns drawn, held bank employees and customers at gunpoint, and got away with approximately $10,000. Ellis fired shots at officers as Patterson drove them away from the bank after the robbery.
Ellis committed two other armed robberies in Hammond before police caught him. He robbed a Marathon gas station of $1,800 on March 19, 2014, and a Mobil gas station of approximately $1,000 on January 26, 2014.
This case was investigated by the Federal Bureau of Investigation GRIT Task Force with the assistance of Bureau of Alcohol, Tobacco, Firearms and Explosives and prosecuted by Assistant United States Attorneys Jennifer Chang and Molly Kelley.
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Illegal Alien Who Stole Identity for Employment in the U.S. Sentenced to Federal PrisonRead the Press Release
A man from Mexico who re-entered the United States illegally and stole another’s identity for purposes of employment was sentenced January 27, 2021 to two years in federal prison.
Heriberto Arellano-Almontes, age 57, from Mexico, received the prison term after a July 22, 2020, guilty plea to aggravated identity theft.
In a plea agreement, Arellano-Almontes admitted that he is an alien citizen of Mexico. Arellano-Almontes was previously removed from the United States to Mexico on or about May 5, 2004. On August 17, 2019, Arellano-Almontes was arrested by law enforcement in Crawford County, Iowa, for Operating a Motor Vehicle While Intoxicated. Arellano-Almontes was found to be employed at Midwest Industries, Inc., in Ida Grove, Iowa, utilizing another’s identity where he filed an I-9 Employment Eligibility Form and W-4 Tax Withholding Form with Midwest Industries on April 11, 2016. He also presented a State of Missouri Identification Card and a social security card under the same identity.
On October 2, 2019, Arellano-Almontes was found illegally residing in Crawford County, Iowa. Arellano-Almontes also has a prior felony conviction for possession of methamphetamine from 2003 out of the District Court for Colfax County, Nebraska.
Arellano-Almontes was sentenced in Sioux City by United States District Court Chief Judge Leonard T. Strand. He was sentenced to 24 months’ imprisonment. He also serve a one-year term of supervised release after the prison term. There is no parole in the federal system.
Arellano-Almontes is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Kevin Fletcher and Ron Timmons, and investigated by U.S. Immigration and Customs Enforcement (ICE).
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 20-4021.
Follow us on Twitter @USAO_NDIA.
Greenfield Man Pleads Guilty to Possession of an Unregistered FirearmRead the Press Release
CONCORD - Alexander Arsenault, 35, of Greenfield, pleaded guilty in federal court on Wednesday to possession of an unregistered firearm, United States Attorney Scott W. Murray announced today.
According to court documents and statements made in court, on December 1, 2018, a device exploded in an empty vehicle parked outside of a home in Greenfield, New Hampshire. The vehicle was severely damaged and law enforcement recovered a match near the driveway of the home. Investigators seized items believed to be from the device that damaged the vehicle and determined that a homemade bomb consisting of a low explosive main charge and a non-electrical fusing system was used for the explosion.
Upon further investigation, law enforcement learned that Arsenault had disputes with the owners of the vehicle and that he had previously purchased items consistent with the items found at the scene of the explosion. A search of Arsenault’s home yielded a typed out document about how to answer law enforcement questions regarding the destruction of a vehicle. A records search revealed that Arsenault has never registered a firearm as required under the National Firearms Act.
Arsenault is scheduled to be sentenced on May 18, 2021.
“By creating and detonating a homemade bomb, the defendant severely damaged a vehicle and jeopardized lives,” said U.S. Attorney Murray. “I am grateful to the FBI and the law enforcement officers whose hard work identified the Mr. Arsenault and led to this prosecution. We will always work closely with our law enforcement partners to identify and prevent threats to public safety.”
“Annoyed by what he believed to be excessive noise coming from his neighbor’s home, Alex Arsenault knowingly and willingly made a home-made explosive bomb, detonated it on their property, and put his fellow citizens in fear for their lives,” said Joseph R. Bonavolonta, Special Agent in Charge of the FBI Boston Division. “The quick and decisive action by the FBI’s Joint Terrorism Task Force, and our partners at the Greenfield Police Department, averted an already hazardous situation from spiraling dangerously out of control.”
This matter was investigated by the Federal Bureau of Investigation with assistance from the Greenfield Police Department. The case is being prosecuted by Assistant U.S. Attorney Anna Krasinski.
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Great Falls methamphetamine trafficker sentenced to 12 years in prisonRead the Press Release
GREAT FALLS — A Great Falls woman who admitted trafficking methamphetamine after law enforcement found five pounds of the drug and a gun in her vehicle was sentenced today to 12 years in prison and five years of supervised release, Acting U.S. Attorney Leif Johnson said.
Opal Inez Cox, 40, pleaded guilty on Oct. 6, 2020 to conspiracy to possess with intent to distribute meth and to possession of a firearm in furtherance of a drug trafficking crime.
Chief U.S. District Judge Brian M. Morris presided. Chief Judge Morris ordered Cox detained.
The prosecution said in court documents that law enforcement learned Cox was distributing meth in Montana and stopped her vehicle as she returned to the state from Las Vegas, Nevada, in December 2019. Law enforcement found about five pounds of meth and a 9mm pistol hidden together in the center console of the car. Five pounds of meth is the equivalent of 18,120 doses.
Assistant U.S. Attorney Ryan Weldon prosecuted the case, which was investigated by the Montana Division of Criminal Investigation, FBI, IRS and Drug Enforcement Administration.
This case is part of Project Guardian, the U.S. Department of Justice’s recent initiative to reduce gun violence and enforce federal firearms laws, and Project Safe Neighborhoods, the USDOJ’s initiative to reduce violent crime. According to the FBI’s Uniform Crime Reports, violent crime in Montana increased by 48% from 2013 through 2019. Through these initiatives, federal, tribal, state and local law enforcement partners in Montana focus on violent crime driven by methamphetamine trafficking, armed robbers, firearms offenses and violent offenders with outstanding warrants.
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Grand jury indicts two men charged in connection with use of a firearm in furtherance of drug trafficking conspiracy resulting in death of victimRead the Press Release
ST. LOUIS – A federal grand jury indicted 25-year-old Cevone Weeden and 35-year-old Herschell Perkins on one count, each, of discharge of one or more firearms in furtherance of the commission of a drug trafficking crime causing death. The same federal grand jury also indicted Weeden on one count of conspiracy to distribute and possess, with the intent to distribute, controlled substances, including fentanyl.
According to charging documents, on or about August 20, 2020, Weeden coordinated with an associate to learn the whereabouts of the victim, who had robbed Weeden of a quantity of narcotics two days prior during a drug deal. Upon learning of the victim’s location on North Hampton Avenue near I-64, Weeden contacted Perkins, who drove the two to this location.
Weeden and Perkins proceeded to drive to various parking lots and side streets in the victim’s immediate vicinity. Shortly before the shooting, Perkins removed the license plates from his vehicle and Weeden turned his phone off. Just after 8:00 p.m., Perkins pulled his vehicle onto a side street across from the victim’s location, at which point Weeden emerged from this same location, crossed Hampton Avenue on foot and shot the victim multiple times while he sat in his vehicle. Weeden then returned to Perkins’ vehicle and the two fled the area.
The defendants face a maximum punishment of life in prison, death, and/or a fine of up to $250,000.
Charges set forth in the indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
The St. Louis Metropolitan Police Department, along with the Drug Enforcement Administration, investigated the case. Assistant United States Attorney Geoffrey Ogden is handling the case.
Grand Jury Returns 3 IndictmentsRead the Press Release
MADISON, WIS. – A federal grand jury in the Western District of Wisconsin, sitting in Madison, returned the following indictments today. You are advised that a charge is merely an accusation and that a defendant is presumed innocent until and unless proven guilty.
Hudson Man Charged with Drug Offenses Involving Methamphetamine
Kevin J. Bell, 41, Hudson, Wisconsin, is charged with distributing methamphetamine on October 16 and December 1, 2020. The indictment alleges that the October 16 distribution involved 50 grams or more of methamphetamine.
If convicted, Bell faces a mandatory minimum penalty of 5 years and a maximum of 40 years in federal prison on the charge alleging distribution of 50 grams or more of methamphetamine, and a maximum penalty of 20 years on the other distribution charge. The charges against him are the result of an investigation by the West Central Drug Task Force; Buffalo, Chippewa, Clark, and Eau Claire County Sheriffs’ Offices; Eau Claire Police Department; Eau Claire County District Attorney’s Office; and the Drug Enforcement Administration. Assistant U.S. Attorney Steven Anderson is handling the prosecution.
Mauston Man Charged with Drug & Gun Crimes
Jerry Scheerer, 27, Mauston, Wisconsin, is charged with distributing methamphetamine and being a felon in possession of a firearm. The indictment alleges that on November 3, 2020, Scheerer distributed 5 grams or more of methamphetamine and possessed a revolver.
If convicted, Scheerer faces a mandatory minimum penalty of 5 years and a maximum of 40 years in federal prison on the drug charge and a maximum of 10 years on the gun charge. The charges against him are the result of an investigation by the Mauston Police Department; Sauk and Juneau County Sheriffs’ Offices; Wisconsin Department of Justice Division of Criminal Investigation; Drug Enforcement Administration; and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Taylor Kraus is handling the prosecution.
Dane County Man Charged with Making False Statement During Purchase of Firearm
Andre Gonzales, 21, Oregon, Wisconsin, is charged with making a false statement to a federally licensed firearms dealer while purchasing a firearm. The indictment alleges that on July 14, 2020, Gonzales stated that he was the actual buyer of a 9mm handgun, when he was not the actual buyer.
If convicted, Gonzales faces a maximum penalty of 5 years in federal prison. The charge against him is the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Madison, Fitchburg and Oregon Police Departments. Assistant U.S. Attorney Meredith Duchemin is handling the prosecution.
Grand Jury Indicts Danville Sex Offender for Alleged Violation of the Sex Offender Registration and Notification ActRead the Press Release
PEORIA, Ill. – The grand jury yesterday returned an indictment that charges David W. Morlan, 66, of Danville, Ill., with failure to register and update his address as required by the federal Sex Offender Notification and Registration Act (SORNA.)
The indictment against Morlan alleges that from June to December 2020, Morlan, a convicted sex offender, failed to update his registration. Morlan was arrested on Jan. 8, 2021, and charged in a criminal complaint. The affidavit filed in support of the complaint alleges that Morlan was convicted in Vermilion County, Ill., in September 2006, for aggravated criminal sexual abuse of a minor, a five-year-old victim. Further, the indictment alleges that Morlan, who had registered his address in Indiana, was living in Danville, Ill., but had not updated his registration.
During a court appearance on Jan. 13, 2021. before U.S. Magistrate Judge Eric I. Long, in Urbana, Morlan was ordered to remain detained in U.S. Marshals Service custody.
If convicted, the penalty for violation of the Sex Offender Registration and Notification Act is up to 10 years in prison.
Assistant U.S. Attorney Elly M. Peirson is representing the government in the prosecution which was investigated by the U.S. Marshals Service and the Danville Police Department.
Members of the public are reminded that an indictment is merely an accusation; the defendant is presumed innocent unless proven guilty.
Georgia Woman Sentenced for Conspiracy to Distribute HeroinRead the Press Release
NEW ORLEANS – U.S. Attorney Peter G. Strasser announced that on GLORIA NAVARRO, age 47, of Loganville, Georgia, was sentenced by United States District Judge Jane Triche Milazzo on January 27, 2021 after previously pleading guilty to drug offenses.
Specifically, NAVARRO previously pled guilty to one count of conspiracy to distribute and possess with the intent to distribute one kilogram or more of heroin, in violation of 21 U.S.C. §§ 841(a)(1), 841(b)(1)(A), and 846.
According to court records, NAVARRO and others conspired to distribute heroin in the New Orleans metropolitan area and elsewhere.
Judge Milazzo sentenced NAVARRO to 210 months of imprisonment, 5 years of supervised release, and a $100 special assessment.
U.S. Attorney Strasser praised the work of the Department of Homeland Security, Homeland Security Investigations in investigating this matter. Assistant United States Attorney Jonathan L. Shih is in charge of the prosecution.
This prosecution is part of an extensive investigation by the Organized Crime Drug Enforcement Task Force (“OCDETF”). OCDETF is a joint federal, state and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional level drug trafficking organizations and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.
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Former West Boylston Nurse Pleads Guilty to Tampering with Hydromorphone and MeperidineRead the Press Release
BOSTON – A former nurse pleaded guilty today in federal court in Boston to tampering with opioids intended for emergency department patients at a hospital where he worked and then attempting to conceal his crime by replacing the diverted narcotics with saline.
Mark Croft, 48, of West Boylston, pleaded guilty to one count of tampering with a consumer product and one count of acquiring a controlled substance by deception and subterfuge. U.S. District Court Judge Allison D. Burroughs scheduled sentencing for May 20, 2021.
While working at a Massachusetts hospital in January 2016, Croft administered hydromorphone and meperidine – both Schedule II controlled substances – to emergency department patients in need of pain relief. Between Jan. 5 and Jan. 14, 2016, Croft tampered with carpujects – syringe devices used to administer injectable fluid medication – containing hydromorphone and meperidine by accessing the automated dispensing machine (ADM) in the hospital’s emergency department.
Specifically, Croft used his credentials to access the ADM and removed carpujects containing hydromorphone and meperidine. He then used syringes to puncture the carpujects and removed portions of the hdyromprohone and meperidine for his own use. In some instances, Croft replaced the medication he removed with saline in an attempt to conceal his conduct. To avoid detection, Croft later put the carpujects with the diluted medication back in the ADM where they remained available for nurses to unwittingly use on patients. Croft also used his credentials to enter a “return to stock” transactions in the ADM, making it falsely appear that no medications had been removed from the carpuject.
The charge of tampering with a consumer product provides for a sentence of up to 10 years in prison, three years of supervised release and a fine of up to $250,000. The charge of obtaining a controlled substance by misrepresentation, fraud, deception and subterfuge provides for a sentence of up to four years in prison, one year of supervised release and a fine of up to $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling; Jeffrey Ebersole, Special Agent in Charge of the U.S. Food and Drug Administration, Office of Criminal Investigations, New York Field Office; and Monica Bharel MD, MPH, Commissioner of the Massachusetts Department of Public Health made the announcement today. Assistant U.S. Attorney Patrick Callahan of Lelling’s Healthcare Fraud Unit is prosecuting the case.
Former Union President and Benefit Funds Administrator Charged with EmbezzlementRead the Press Release
NEWARK, N.J. –The former president of a New Jersey local union and administrator of two union affiliated benefit funds made her initial appearance today on charges that she embezzled from the union and two union-affiliated employee benefit funds, Acting U.S. Attorney Rachael A. Honig announced.
Dorothy McBride, 74, of Montville, New Jersey, was charged by complaint with one count each of embezzlement of labor union assets and embezzlement from employee benefit plans. She allegedly embezzled approximately $100,000 from a local union affiliated with the Communications Workers of America (CWA), of which she was president, and approximately $534,470 from the Welfare Fund and the Pension Fund, of which she was administrator. McBride made her initial appearances today by videoconference before U.S. Magistrate Judge Leda Dunn Wettre and was released on $250,000 unsecured bond.
According to the documents filed in this case and statements made in court:
McBride had control over the union’s and the funds’ bank accounts. From at least 2015 through June 2018, she made routine payments to her personal credit card accounts from the bank accounts of the union and employee benefit funds for expenditures that were not authorized or for legitimate union or fund purposes. McBride caused the pension fund to direct monthly payments for pension benefits to a personal account of hers for a benefit that she was ineligible to receive and that the pension fund was not obligated to pay out.
The charges of embezzlement of labor union assets and embezzlement from employee benefit plans each carry a statutory maximum sentence of five years in prison and a maximum $250,000 fine, or twice the gain or loss from the offense.
Acting U.S. Attorney Honig credited the investigators of the U.S. Department of Labor, Employee Benefits Security Administration, under the direction of Regional Director Thomas Licetti of the New York Regional Office; investigators of the U.S. Department of Labor, Office of Labor Management Standards, under the direction of Adriana Vamvakas, Regional Director; and special agents of the Department of Labor – Office of the Inspector General, New York Region, under the direction of Special Agent in Charge Michael Mikulka, with the investigation leading to the charges.
The government is represented by Special Assistant U.S. Attorney Kendall Randolph of the U.S. Attorney’s Office’s Organized Crime and Gangs Unit in Newark.
The charges and allegations in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Former Marion High School Guidance Counselor IndictedRead the Press Release
FORT WAYNE – Ryan Christian Vermilion, age 46, of Marion, Indiana was charged with production of child pornography by way of a single count Grand Jury Indictment, announced Acting U.S. Attorney Gary T. Bell.
According to documents in this case, from on or about January 26, 2020 through February 18, 2020, Mr. Vermilion allegedly enticed a minor to send him sexually explicit pictures. Also alleged is that the victim met the defendant through cross-platform social media sites, engaging in chat and photo sharing while believing the defendant was an ill teenage boy.
The United States Attorney’s Office emphasizes that an Indictment is merely an allegation and that all persons are presumed innocent until, and unless proven guilty in court.
If convicted, any specific sentence to be imposed will be determined by the Judge after a consideration of federal statutes and the Federal Sentencing Guidelines.
This case is a result of an investigation by the Federal Bureau of Investigation with the assistance of the Indiana State Police and Wells County Sheriff’s Department This case is being prosecuted by Assistant United States Attorney Lesley J. Miller Lowery.
Parents are strongly encouraged to speak with their children about similar conversations and contact the FBI at 317-595-4000 if anything similar is found on any of their devices.
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Former Federal Aviation Administration employee sentenced for severing air traffic communicationsRead the Press Release
HONOLULU, Hawaii – A federal judge today sentenced Joelyn DeCosta, 48, of Honolulu, Hawaii, to two years of probation and a $5000 fine for willfully and maliciously interfering with the working and use of a communication system operated and controlled by the United States, in violation of Title 18, United States Code, Section 1362.
According to documents and information presented in court, DeCosta was an Airway Transportation Systems Specialist for the Federal Aviation Administration, and had worked for the F.A.A. for approximately 26 years. On January 4, 2019, she willfully and maliciously severed communications between Air Traffic Control in Honolulu and aircraft flying in U.S. airspace above and around Honolulu, in an area known as Sector 4, which covers flights between Oahu and Maui, Lanai, Moloka’i, Kaho’olawe, and the Big Island. The main and standby communication lines between Hawaii Air Traffic Control and pilots of approximately six planes during one incident and approximately four planes during a second incident were affected by the outages. In total, pilots could not hear instructions from Air Traffic Control for a total of two minutes, as a result of the outages caused by the defendant.
The defendant had previously pled guilty pursuant to a plea agreement. As part of her plea agreement, she resigned from the F.A.A. before sentencing. As a result, she lost her retirement benefits, which were estimated to have been worth in excess of $500,000.
One of the pilots of an aircraft affected by the outage spoke as a victim at the sentencing. He emphasized the danger to himself and the 40 passengers onboard his aircraft posed by the outage.
“The United States Attorney’s Office takes any threat to the safety of the air travelling public very seriously, and will vigorously enforce federal criminal laws against any federal employee who abuses their position and, in doing so, puts air travelers in harm’s way,” said U.S. Attorney Kenji M. Price.
“Employees of the Federal Aviation Administration (FAA) are entrusted with safely overseeing the busiest and most complex air transportation system in the world. Key to that trust is maintaining an uncompromising level of integrity in their work, which many FAA personnel do,” said Cissy Tubbs, Special Agent-in-Charge, Western Region, Department of Transportation, Office of Inspector General - Investigations. “Today’s sentencing demonstrates our commitment to working with our law enforcement partners and the U.S. Attorney’s Office to detect and prevent those willing to compromise the safety of the National Airspace System and the traveling public.”
The case was investigated by the Department of Transportation, Office of Inspector General, and the Federal Bureau of Investigation. It was prosecuted by Assistant U.S. Attorney Marc A. Wallenstein.
Former DeKalb County Sergeant sentenced for possessing equipment to make fraudulent credit cards and ID’sRead the Press Release
ATLANTA - Claude Goines has been sentenced to prison for running a fake credit card and ID lab. Goines operated a carding lab where he manufactured fraudulent credit cards and driver's licenses while he was on a work release program related to an earlier fraud conviction.
“Identity theft and credit card fraud has become an all too common problem,” said Acting U.S. Attorney Bobby L. Christine. “The actions of thieves like Goines can severely damage citizens’ lives and credit. In some cases, it can take years to repair. We encourage all citizens to monitor their credit for any suspicious activity, and if they find any, to contact law enforcement immediately.”
“It is clear that Goines was determined to continue to hurt citizens by stealing their identities to line his own pockets,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “Particularly disturbing is the fact that he is a former law enforcement officer sworn to protect citizens.”
“This sentencing should send the message, to other identity thieves and fraudsters, that crime doesn’t pay. This type of crime has quickly become a serious threat to our communities because of how much damage they can do so quickly,” said Special Agent in Charge Katrina W. Berger, who oversees Homeland Security Investigations (HSI) operations in Georgia and Alabama. “Goines, a repeat offender and former member of law enforcement, thought he could get away with his crimes and prosper, but thanks to the hard work and vigilance of HSI and its law enforcement partners he was wrong.”
“Unfortunately, some people have a difficult time breaking their cycle of criminal behavior,” said U.S. Secret Service Special Agent in Charge Steve Baisel. “Goines, and others like him, seem to find the lure of victimizing others greater than the potential consequences of their actions. We will not stop our efforts to bring to justice those who prey on others.”
According to U.S. Attorney Christine, the charges and other information presented in court: Claude Goines is a former detention officer at the DeKalb County Sheriff’s Office in Decatur, Georgia, where he rose to the rank of sergeant. While he was on a work release program related to an earlier fraud conviction, Goines operated a carding lab where he manufactured fraudulent credit cards and driver's licenses.
When federal agents executed a search of the lab, Goines was present while counterfeit cards were being produced. The lab contained multiple laptops, USB storage devices, cell phones, printers, blank card stock, security holograms for driver’s licenses of several U.S. states, two handguns, and other related items. Goines imported fraudulent holograms to be used with the fake Georgia driver's licenses he produced.
Claude Goines, 35, of Lilburn, Georgia, has been sentenced to two years, six months in prison to be followed by three years of supervised release. Goines was convicted on these charges on October 28, 2020, after he pleaded guilty to charges of access device fraud and possession of device-making equipment.
This case was investigated by the U.S. Secret Service, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, and Federal Bureau of Investigation.
Assistant U.S. Attorney Christopher J. Huber, Deputy Chief of the Complex Frauds Section, prosecuted the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Former Atlantic City Mayor Sentenced to One Month in Prison, 11 Months of Home Confinement, for Defrauding Contributors to Youth Basketball TeamRead the Press Release
CAMDEN, N.J. – The former mayor of Atlantic City was sentenced today to 30 days in prison and 11 months of home confinement for defrauding contributors to a youth basketball team out of more than $86,000, Acting U.S. Attorney Rachael Honig announced.
Frank Gilliam, 49, of Atlantic City, New Jersey, previously pleaded guilty to an information charging him with wire fraud. U.S. District Judge Joseph H. Rodriguez imposed the sentence today by videoconference.
According to documents filed in this case and statements made in court:
Gilliam was the co-founder of AC Starz Basketball Club (AC Starz), a non-profit that he incorporated to operate a youth basketball team. While serving as a member of the Atlantic City Council and later, as mayor of Atlantic City, Gilliam solicited donations for AC Starz from various individuals and entities under the false pretense that the contributions were for a youth basketball team and/or school supplies for underprivileged children. Gilliam instead used most of the money for personal expenses – including luxury clothing, expensive meals, and trips – that were completely unrelated to the operation of a youth basketball team. In total, Gilliam defrauded the contributors out of $86,790.
In addition to the prison term, Judge Rodriguez sentenced Gilliam to three years of supervised release, ordered him to pay restitution to his victims in the amount of $86,790 and ordered him to perform 200 hours of community service.
Acting U.S. Attorney Rachael Honig credited special agents of the FBI Atlantic City Resident Agency and FBI Atlantic City Public Corruption Task Force, which includes the Atlantic County and Cape May County Prosecutor’s Offices and the Atlantic City Police Department, under the direction of FBI Special Agent in Charge George M. Crouch Jr. in Newark, and special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Sean Farrell of the U.S. Attorney’s Office’s Special Prosecutions Division.
Fitchburg Man Pleads Guilty to Fentanyl, Crack Cocaine and Cocaine ConspiracyRead the Press Release
BOSTON – A Fitchburg man pleaded guilty today to his role in a fentanyl and crack cocaine trafficking conspiracy. The defendant sold drugs to customers in the Fitchburg area and had associates sell drugs on his behalf.
Alberto Nunez, 46, pleaded guilty to one count of conspiracy to distribute and possess with intent to distribute 28 grams or more of cocaine base (commonly known as crack cocaine), fentanyl and cocaine. U.S. District Court Judge Timothy S. Hillman scheduled sentencing for May 10, 2021. Nunez was charged by federal criminal complaint in February 2020.
From approximately November 2019 to February 2020, Nunez conspired with others to distribute and to possess with intent to distribute cocaine base, fentanyl and cocaine in Worcester County and elsewhere in Massachusetts. As part of a federal investigation into drug trafficking in the Fitchburg area in September 2018, Nunez was identified as a drug dealer who regularly distributed fentanyl and cocaine base to multiple drug customers. Nunez delivered the drugs to his customers himself and also had multiple associates deliver fentanyl and cocaine base to customers on his behalf. Most of Nunez’s customers were drug users, but some further distributed the drugs they purchased from Nunez.
The charge of conspiracy to distribute 28 grams or more of cocaine base, fentanyl and cocaine provides for a sentence of at least five years and up to 40 years in prison, at least four years of supervised release and a fine of up to $5 million. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
This case is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
United States Attorney Andrew E. Lelling; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Commissioner Carol Mici of the Massachusetts Department of Correction; and Colonel Christopher Mason, Superintendent of the Massachusetts State Police made the announcement today. The Fitchburg and Lunenburg Police Departments also provided valuable assistance with the investigation. Assistant U.S. Attorney Alathea Porter of Lelling’s Narcotics and Money Laundering Unit is prosecuting the case.
Federal Judge Sentences Three Methamphetamine TraffickersRead the Press Release
CHARLOTTE, N.C. – Today, U.S. District Judge Kenneth D. Bell handed down sentences ranging from 120 to 144 months in prison, to three individuals for their involvement in a methamphetamine trafficking ring, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.
Judge Bell sentenced the defendants as follows:
- Christy Lee Latham, 43, of West Jefferson, N.C. was sentenced to 144 months in prison, followed by five years of supervised release. Latham pleaded guilty to methamphetamine trafficking conspiracy and distribute and possession with intent to distribute methamphetamine. Latham’s sentence was enhanced due to her violation of her conditions of supervised release for a prior federal methamphetamine trafficking conviction.
- Joshua Dean Lipford, 33, of Trade, Tennessee, was sentenced to 138 months in prison and five years of supervised release. Lipford pleaded guilty to methamphetamine trafficking conspiracy.
- Chasty Elaine Hinson Stallings, 40, of Morganton, N.C., was sentenced to 120 months in prison and five years of supervised release. Stallings pleaded guilty to two counts of possession with intent to distribute methamphetamine and one count of possession of firearm by felon.
A fourth defendant, Heather Renee Arnold pleaded guilty on December 23, 2020, to possession with intent to distribute methamphetamine and is awaiting sentencing.
According to court documents and today’s sentencing hearing, in September 2019, Stallings was a part of a methamphetamine trafficking ring operating in Caldwell County and elsewhere. Over the course of the investigation Stallings was found in possession of 730 grams of 97.9% pure methamphetamine and a firearm. According to court records, between February and March 2020, in Ashe and Watauga Counties, and elsewhere, law enforcement seized more than 750 grams of methamphetamine with purity greater than 94% from Arnold, Latham, and Lipford.
This case is the result of the Organized Crime Drug Enforcement Task Force (OCDETF) Operation “Dixie Crystal.” According to court documents, since 2015, more than 220 individuals have been prosecuted as a result of the Dixie Crystal investigation. Court records show that the drug trafficking organizations involved have trafficked methamphetamine worth millions of dollars. Over the course of the investigation, law enforcement seized far in excess of 100 kilograms of crystal methamphetamine, $1,000,000 in U.S. currency and other assets, and dozens of firearms. OCDETF is a joint federal, state and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional drug trafficking organizations and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.
In making today’s announcement, U.S. Attorney Murray recognized the following federal, state and local agencies which partnered in Operation Dixie Crystal, and thanked them for their continued cooperation and support: the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); North Carolina State Bureau of Investigation (NC SBI); Alexander County Sheriff’s Office; Ashe County Sheriff’s Office; Boone Police Department; Caldwell County Sheriff’s Office; Hickory Police Department; Jefferson Police Department; North Wilkesboro Police Department; Watauga County Sheriff’s Office; Wilkesboro Police Department; and Johnson County Sheriff’s Office, Tennessee.
The prosecutions are being handled by Assistant U.S. Attorney Steven R. Kaufman of the U.S. Attorney’s Office in Charlotte.
Federal Court Permanently Bars Southern Florida Tax Preparer from Preparing ReturnsRead the Press Release
A federal court in the Southern District of Florida has permanently enjoined a West Palm Beach tax return preparer and her business from preparing federal income tax returns for others, the Justice Department announced today. According to the court’s order, it issued the injunction in response to violations of a prior order in the case that had allowed the preparer and her business to prepare returns subject to certain restrictions.
In April 2017, the United States filed a complaint against Lena D. Cotton and Professional Accounting LDC LLC, that alleged the defendants prepared returns with improper education credits, manipulated filing statuses, and improper vehicle deductions, among other issues. In November 2017, the court permanently enjoined both defendants from this and other specific conduct and required defendants to engage a “neutral monitor” to “determin[e] and/or secur[e] compliance” with injunction.
In an August 2019 order, the court held Cotton and Professional Accounting LDC in contempt of the November 2017 order and “imposed additional limits on [d]efendants’ operations[,]” including restrictions on the number and type of returns they could prepare. The order stated that “[t]hese new restrictions are [d]efendants’ final opportunity” and that the remedy for any further violations “shall be a permanent ban on tax return preparation.”
On Jan. 27, 2021, the court issued an order holding defendants in contempt a second time. According to the order, defendants “have attempted to circumvent the terms of the injunction” and subsequent orders “and have, in some cases, violated the restrictions placed upon them by those [o]rders.” In particular, the court found that Cotton and Professional Accounting LDC “in effect . . . employ[ed] and overs[aw]” other individuals and entities who prepared prohibited returns out of Professional Accounting LDC’s West Palm Beach office, with Cotton and Professional Accounting LDC “retaining a great deal of the profits.” In light of previous violations by Cotton and Professional Accounting LDC, the court found that “any remedy short of a permanent injunction on return preparation is inadequate.”
In addition, the court barred Cotton and Professional Accounting LDC from selling their customer lists to certain non-party individuals or entities, citing the “significant risk” that any such sale could be an “attempt to perpetuate” the “fraudulent schemes” employed by defendants. According to the order, defendants “in effect . . . employ[ed] and overs[aw]” these non-parties and both “individually and through [the non-parties]” attempted to evade and/or violate the restrictions imposed by the injunction and ensuing orders. The order states, “the evidence tends to support a finding that [the non-parties] were aware of” the restrictions that had been placed on defendants and that “most of them worked in active concert or participation” with defendants.
The order specifically names the following individuals and entities: Anthony Boone, Donellar Wims-Boone, Latesha Temple, Melissa Morgan-Wright, Kelly Dunlop, Matthew Dunlop, Richard Wise, Professional Accounting by R&K, Professional Accounting by MM, and Temple Financial Solutions. The order finds that Morgan-Wright founded Professional Accounting by MM. It further finds that Wise and Kelly Dunlop formed Professional Accounting by R&K, and that Matthew Dunlop and Wims-Boone are also “involved with” that entity. Additionally, the order finds that Temple formed Temple Financial Solutions, and Boone prepared tax returns using Temple Financial System’s federal preparer identification. According to the order, Boone, Wims-Boone, Temple, Morgan-Wright, and Kelly and Matthew Dunlop all “previously worked in some capacity for [defendants],” and Wise is a former customer.
According to the order, defendant Cotton referred customers to Temple Financial Solutions, Professional Accounting by MM, and Professional Accounting by R&K, all three of which operated out of defendant Professional Accounting LDC’s office. The order notes that “[a]s of May 13, 2020, approximately 80% of the returns filed in 2020” by the non-parties “were for customers that previously used [d]efendants as their return preparer.” The order notes that “customers who previously had returns prepared by [d]efendants may have thought they were returning to [d]efendants’ business.” In addition, according to the order, defendants “retained a great deal of the profits” on the returns prepared by the non-parties and at least some of the non-parties were compensated by defendants like employees.
Return preparer fraud is one of the IRS’ Dirty Dozen Tax Scams and taxpayers seeking a return preparer should remain vigilant (more information can also be found here). The IRS has information on its website for choosing a tax preparer and has launched a free directory of federal tax preparers. In addition, IRS Free File, a public-private partnership, offers free online tax preparation and filing options on IRS partner websites for individuals whose adjusted gross income is under $72,000. For individuals whose income is over that threshold, IRS Free File offers electronical federal tax forms that can be filled out and filed online for free.
In the past decade, the Department of Justice’s Tax Division has obtained injunctions against hundreds of unscrupulous tax preparers. Information about these cases is available on the Justice Department website. An alphabetical listing of persons enjoined from preparing returns and promoting tax schemes can be found on this page. If you believe that one of the enjoined persons or businesses may be violating an injunction, please contact the Tax Division with details.
Emotet Botnet Disrupted in International Cyber OperationRead the Press Release
WASHINGTON – The Justice Department today announced its participation in a multinational operation involving actions in the United States, Canada, France, Germany, the Netherlands, and the United Kingdom to disrupt and take down the infrastructure of the malware and botnet known as Emotet. Additionally, officials in Lithuania, Sweden, and Ukraine assisted in this major cyber investigative action.
“The Emotet malware and botnet infected hundreds of thousands of computers throughout the United States, including our critical infrastructure, and caused millions of dollars in damage to victims worldwide,” said Acting Deputy Attorney General John Carlin. “Cyber criminals will not escape justice regardless of where they operate. Working with public and private partners around the world we will relentlessly pursue them while using the full arsenal of tools at our disposal to disrupt their threats and prosecute those responsible.”
According to an unsealed search warrant affidavit, Emotet is a family of malware that targets critical industries worldwide, including banking, e commerce, healthcare, academia, government, and technology. Emotet malware primarily infects victim computers through spam email messages containing malicious attachments or hyperlinks. Emails were designed to appear to come from a legitimate source or someone in the recipient’s contact list. Once it has infected a victim computer, Emotet can deliver additional malware to the infected computer, such as ransomware or malware that steals financial credentials. Ransomware, in particular, has increased in scope and severity in the past year, harming businesses, healthcare providers, and government agencies even as the country has struggled to respond to the pandemic.
“The coordinated disruption of Emotet was a great success for the FBI and our international partners,” said FBI Director Christopher Wray. “The FBI utilized sophisticated techniques, our unique legal authorities, and most importantly, our worldwide partnerships to significantly disrupt the malware. The operation is an example of how much we can achieve when we work with our international law enforcement partners to combat the cyber threat. The FBI remains committed, now more than ever, to imposing risk and consequences on cyber criminals to put an end to this type of criminal activity.”
The computers infected with Emotet malware are part of a botnet (i.e., a network of compromised computers), meaning the perpetrators can remotely control all the infected computers in a coordinated manner. The owners and operators of the victim computers are typically unaware of the infection.
“Cybercrime transcends physical and political boundaries and costs U.S. citizens and businesses billions each year,” said U.S. Attorney Matt Martin of the Middle District of North Carolina. “That was certainly true with Emotet. Now, more than ever, international collaboration is an imperative as we employ a technically and legally sophisticated approach to thwart cybercriminals in whatever corner of the globe they are found. This investigation will be a paradigm for effective international law enforcement cooperation directed at global cybercrime, and we applaud the FBI and the international law enforcement partners who contributed to the effort to take down this global threat.”
According to the affidavit, in 2017, for example, the computer network of a school district in the Middle District of North Carolina was infected with the Emotet malware. The Emotet infection caused damage to the school’s computers, including but not limited to the school’s network, which was disabled for approximately two weeks. In addition, the infection caused more than $1.4 million in losses, including but not limited to the cost of virus mitigation services and replacement computers. From 2017 to the present, there have been numerous other victims throughout North Carolina and the United States, to include computer networks of local, state, tribal, and federal governmental units, corporations, and networks related to critical infrastructure.
“The Emotet malware quickly elevated to one of the top cyber threats in the world,” said Special Agent in Charge Robert R. Wells of the FBI Charlotte Field Office. “The strong relationships with international law enforcement partners were critical to the success of this FBI investigation which began with a small North Carolina school system that did the right thing and quickly contacted their local FBI office for help.”
According to the U.S. Cybersecurity & Infrastructure Security Agency (CISA), Emotet infections have cost local, state, tribal, and territorial governments up to $1 million per incident to remediate. More information about the malware, including technical information for organizations about how to mitigate its effects, is available from CISA here: https://us-cert.cisa.gov/ncas/alerts/TA18-201A.
According to the affidavit, foreign law enforcement agents, working in coordination with the FBI, gained lawful access to Emotet servers located overseas and identified the Internet Protocol addresses of approximately 1.6 million computers worldwide that appear to have been infected with Emotet malware between April 1, 2020, and Jan. 17, 2021. Of those, over 45,000 infected computers appear to have been located in the United States.
Foreign law enforcement, working in collaboration with the FBI, replaced Emotet malware on servers located in their jurisdiction with a file created by law enforcement, according to the affidavit. This was done with the intent that computers in the United States and elsewhere that were infected by the Emotet malware would download the law enforcement file during an already-programmed Emotet update. The law enforcement file prevents the administrators of the Emotet botnet from further communicating with infected computers. The law enforcement file does not remediate other malware that was already installed on the infected computer through Emotet; instead, it is designed to prevent additional malware from being installed on the infected computer by untethering the victim computer from the botnet.
The scope of this law enforcement action was limited to the information installed on infected computers by the Emotet operators and did not extend to the information of the owners and users of the computers.
According to the affidavit, in coordination with foreign law enforcement officials, FBI personnel also gained lawful access to an Emotet distribution server located overseas and identified several servers worldwide that were used to distribute the Emotet malware. These servers were typically compromised web servers belonging to what appear to be unknowing third parties. The perpetrators uploaded the Emotet malware to the servers through unauthorized software applications. Victims who clicked on spam email messages containing malicious attachments or hyperlinks would then download the initial Emotet malware file from a distribution server.
In addition, according to the affidavit, FBI personnel notified more than 20 U.S.-based hosting providers that they hosted more than 45 IP addresses that had been compromised by the perpetrators associated with the Emotet malware and botnet. FBI Legal Attachés further notified authorities in more than 50 countries that hosting providers in their respective jurisdictions hosted hundreds of IP addresses that were compromised by Emotet.
The U.S. Attorney’s Office for the Middle District of North Carolina, the FBI Charlotte Division, and the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS) conducted the operation in close cooperation with Europol and Eurojust who were an integral part of coordination and messaging, and investigators and prosecutors from several jurisdictions, including the Royal Canadian Mounted Police, France’s National Police and Judicial Court of Paris, Germany’s Federal Criminal Police and General Public Prosecutor’s Office Frankfurt/Main, Lithuanian Criminal Police Bureau, Netherlands National Police and National Public Prosecution Office, Swedish Police Authority, National Police of Ukraine and Office of the Prosecutor General of Ukraine, and the United Kingdom’s National Crime Agency and Crown Prosecution Service. The Justice Department’s Office of International Affairs and the U.S. Department of the Treasury Financial Crimes Enforcement Network (FinCEN) also provided significant assistance. CCIPS Senior Counsel Ryan K.J. Dickey and Assistant U.S. Attorneys Eric Iverson and Anand Ramaswamy of the Middle District of North Carolina led the U.S. efforts.
More information about the operation is available by clicking: Eurojust/Europol. In addition, the Dutch National Police have created the following website to check whether your email address has been compromised by the administrators of Emotet: https://www.politie.nl/emocheck.
In September 2020, FBI Director Christopher Wray announced the FBI’s new strategy for countering cyber threats. The strategy focuses on imposing risk and consequences on cyber adversaries through the FBI’s unique authorities, world-class capabilities, and enduring partnerships. Victims are encouraged to report the incident online with the Internet Crime Complaint Center (IC3) www.ic3.gov. For more information on ransomware prevention, visit: https://www.ic3.gov/Home/Ransomware.
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Emotet Botnet Disrupted in International Cyber OperationRead the Press Release
The Justice Department today announced its participation in a multinational operation involving actions in the United States, Canada, France, Germany, the Netherlands, and the United Kingdom to disrupt and take down the infrastructure of the malware and botnet known as Emotet. Additionally, officials in Lithuania, Sweden, and Ukraine assisted in this major cyber investigative action.
“The Emotet malware and botnet infected hundreds of thousands of computers throughout the United States, including our critical infrastructure, and caused millions of dollars in damage to victims worldwide,” said Acting Deputy Attorney General John Carlin. “Cyber criminals will not escape justice regardless of where they operate. Working with public and private partners around the world we will relentlessly pursue them while using the full arsenal of tools at our disposal to disrupt their threats and prosecute those responsible.”
According to an unsealed search warrant affidavit, Emotet is a family of malware that targets critical industries worldwide, including banking, e‑commerce, healthcare, academia, government, and technology. Emotet malware primarily infects victim computers through spam email messages containing malicious attachments or hyperlinks. Emails were designed to appear to come from a legitimate source or someone in the recipient’s contact list. Once it has infected a victim computer, Emotet can deliver additional malware to the infected computer, such as ransomware or malware that steals financial credentials. Ransomware, in particular, has increased in scope and severity in the past year, harming businesses, healthcare providers, and government agencies even as the country has struggled to respond to the pandemic.
“The coordinated disruption of Emotet was a great success for the FBI and our international partners,” said FBI Director Christopher Wray. “The FBI utilized sophisticated techniques, our unique legal authorities, and most importantly, our worldwide partnerships to significantly disrupt the malware. The operation is an example of how much we can achieve when we work with our international law enforcement partners to combat the cyber threat. The FBI remains committed, now more than ever, to imposing risk and consequences on cyber criminals to put an end to this type of criminal activity.”
The computers infected with Emotet malware are part of a botnet (i.e., a network of compromised computers), meaning the perpetrators can remotely control all the infected computers in a coordinated manner. The owners and operators of the victim computers are typically unaware of the infection.
“Cybercrime transcends physical and political boundaries and costs U.S. citizens and businesses billions each year,” said U.S. Attorney Matt Martin of the Middle District of North Carolina. “That was certainly true with Emotet. Now, more than ever, international collaboration is an imperative as we employ a technically and legally sophisticated approach to thwart cybercriminals in whatever corner of the globe they are found. This investigation will be a paradigm for effective international law enforcement cooperation directed at global cybercrime, and we applaud the FBI and the international law enforcement partners who contributed to the effort to take down this global threat.”
According to the affidavit, in 2017, for example, the computer network of a school district in the Middle District of North Carolina was infected with the Emotet malware. The Emotet infection caused damage to the school’s computers, including but not limited to the school’s network, which was disabled for approximately two weeks. In addition, the infection caused more than $1.4 million in losses, including but not limited to the cost of virus mitigation services and replacement computers. From 2017 to the present, there have been numerous other victims throughout North Carolina and the United States, to include computer networks of local, state, tribal, and federal governmental units, corporations, and networks related to critical infrastructure.
“The Emotet malware quickly elevated to one of the top cyber threats in the world,” said Special Agent in Charge Robert R. Wells of the FBI Charlotte Field Office. “The strong relationships with international law enforcement partners were critical to the success of this FBI investigation which began with a small North Carolina school system that did the right thing and quickly contacted their local FBI office for help.”
According to the U.S. Cybersecurity & Infrastructure Security Agency (CISA), Emotet infections have cost local, state, tribal, and territorial governments up to $1 million per incident to remediate. More information about the malware, including technical information for organizations about how to mitigate its effects, is available from CISA here: https://us-cert.cisa.gov/ncas/alerts/TA18-201A.
According to the affidavit, foreign law enforcement agents, working in coordination with the FBI, gained lawful access to Emotet servers located overseas and identified the Internet Protocol addresses of approximately 1.6 million computers worldwide that appear to have been infected with Emotet malware between April 1, 2020, and Jan. 17, 2021. Of those, over 45,000 infected computers appear to have been located in the United States.
Foreign law enforcement, working in collaboration with the FBI, replaced Emotet malware on servers located in their jurisdiction with a file created by law enforcement, according to the affidavit. This was done with the intent that computers in the United States and elsewhere that were infected by the Emotet malware would download the law enforcement file during an already-programmed Emotet update. The law enforcement file prevents the administrators of the Emotet botnet from further communicating with infected computers. The law enforcement file does not remediate other malware that was already installed on the infected computer through Emotet; instead, it is designed to prevent additional malware from being installed on the infected computer by untethering the victim computer from the botnet.
The scope of this law enforcement action was limited to the information installed on infected computers by the Emotet operators and did not extend to the information of the owners and users of the computers.
According to the affidavit, in coordination with foreign law enforcement officials, FBI personnel also gained lawful access to an Emotet distribution server located overseas and identified several servers worldwide that were used to distribute the Emotet malware. These servers were typically compromised web servers belonging to what appear to be unknowing third parties. The perpetrators uploaded the Emotet malware to the servers through unauthorized software applications. Victims who clicked on spam email messages containing malicious attachments or hyperlinks would then download the initial Emotet malware file from a distribution server.
In addition, according to the affidavit, FBI personnel notified more than 20 U.S.-based hosting providers that they hosted more than 45 IP addresses that had been compromised by the perpetrators associated with the Emotet malware and botnet. FBI Legal Attachés further notified authorities in more than 50 countries that hosting providers in their respective jurisdictions hosted hundreds of IP addresses that were compromised by Emotet.
The U.S. Attorney’s Office for the Middle District of North Carolina, the FBI Charlotte Division, and the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS) conducted the operation in close cooperation with Europol and Eurojust who were an integral part of coordination and messaging, and investigators and prosecutors from several jurisdictions, including the Royal Canadian Mounted Police, France’s National Police and Judicial Court of Paris, Germany’s Federal Criminal Police and General Public Prosecutor’s Office Frankfurt/Main, Lithuanian Criminal Police Bureau, Netherlands National Police and National Public Prosecution Office, Swedish Police Authority, National Police of Ukraine and Office of the Prosecutor General of Ukraine, and the United Kingdom’s National Crime Agency and Crown Prosecution Service. The Justice Department’s Office of International Affairs and the U.S. Department of the Treasury Financial Crimes Enforcement Network (FinCEN) also provided significant assistance. CCIPS Senior Counsel Ryan K.J. Dickey and Assistant U.S. Attorneys Eric Iverson and Anand Ramaswamy of the Middle District of North Carolina led the U.S. efforts.
More information about the operation is available by clicking: Eurojust/Europol. In addition, the Dutch National Police have created the following website to check whether your email address has been compromised by the administrators of Emotet: https://www.politie.nl/emocheck.
In September 2020, FBI Director Christopher Wray announced the FBI’s new strategy for countering cyber threats. The strategy focuses on imposing risk and consequences on cyber adversaries through the FBI’s unique authorities, world-class capabilities, and enduring partnerships. Victims are encouraged to report the incident online with the Internet Crime Complaint Center (IC3) www.ic3.gov. For more information on ransomware prevention, visit: https://www.ic3.gov/Home/Ransomware.
Documents and Resources Related to the Disruption of the Emotet Malware and Botnet
Electronic Health Records Technology Vendor to Pay $18.25 Million to Resolve Kickback AllegationsRead the Press Release
A national electronic health records (EHR) technology vendor based in Watertown, Massachusetts, athenahealth Inc. (Athena), has agreed to pay $18.25 million to resolve allegations that it violated the False Claims Act by paying unlawful kickbacks to generate sales of its EHR product, athenaClinicals, the Justice Department announced today.
In a complaint filed in conjunction with today’s settlement, the United States alleged that Athena violated the False Claims Act and the Anti-Kickback Statute through three marketing programs. First, Athena invited prospective and existing customers to “Concierge Events,” providing free tickets to and amenities at sporting, entertainment, and recreational events, including trips to the Masters Tournament and the Kentucky Derby with complimentary travel and luxury accommodations, meals, and alcohol. Second, Athena paid kickbacks to its existing customers under a “Lead Generation” program designed to identify and refer new prospective clients to Athena. Under this program, Athena paid up to $3,000 to existing customers for each new client that signed up for Athena services, regardless of how much time, if any, the existing customer spent speaking to or meeting with the new client. Finally, Athena entered into deals with competing vendors that were discontinuing their EHR technology offerings to refer their clients to Athena. Under such deals, Athena paid remuneration to the competitor based on the value and volume of practices that were successfully converted into Athena clients.
“This resolution demonstrates the department’s continued commitment to hold EHR companies accountable for the payment of unlawful kickbacks in any form,” said Acting Assistant Attorney General Brian Boynton for the Department of Justice’s Civil Division. “EHR technology plays an important role in the provision of medical care, and it is critical that the selection of an EHR platform be made without the influence of improper financial inducements.”
“Across the country, physicians rely on electronic health records software to provide vital patient data. Kickbacks corrupt the market for health care services and risk jeopardizing patient safety,” said U.S. Attorney Andrew E. Lelling for the District of Massachusetts. “We will aggressively pursue organizations that fail to play by the rules; EHR companies are no exception.”
“If the benefits of Electronic Health Records are to be fully realized, patients must be confident providers have selected the most effective system – not the one paying the largest kickbacks. Time and again, we’ve seen fraudulent activity undermine the integrity of medical decisions, subvert the health marketplace, and waste taxpayer dollars,” said Phillip M. Coyne, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services. “We will continue to hold accountable those who provide illegal incentives in order to influence the decision-making of health care providers.”
“It is illegal for companies to extend invitations to all-expense-paid sporting, entertainment, and recreational events, and other perk-filled offers to its prospective customers to win business and boost their bottom line through illegal kickback schemes,” said Joseph R. Bonavolonta, Special Agent in Charge of the FBI Boston Division. “Today’s agreement by Athena to pay $18.25 million should send a strong message to anyone thinking about engaging in this type of illegal activity. The FBI will continue to work with our law enforcement partners to do everything in our power to safeguard our government health care programs and the taxpayers picking up the bill.”
The settlement resolves allegations in a lawsuit filed by Geordie Sanborn and a separate lawsuit filed by Cheryl Lovell and William McKusick; both matters are pending in federal court in Boston, Massachusetts. The lawsuits were filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private individuals to sue on behalf of the government for false claims and to share in any recovery. The Act allows the government to intervene and take over the action, as it did in these two cases. The whistleblower share to be awarded in connection with the settlement has not been determined.
The government’s pursuit of these matters illustrates the government’s emphasis on combating health care fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services, at 800‑HHS‑TIPS (800-447-8477).
This matter is being handled by the Civil Division’s Commercial Litigation Branch (Fraud Section) and the U.S. Attorney’s Office for the District of Massachusetts, with assistance from the U.S. Department of Health and Human Services, Office of Inspector General; the Federal Bureau of Investigation; the Department of Veterans Affairs, Office of Inspector General; and the U.S. Postal Service, Office of Inspector General. The two lawsuits are captioned United States ex rel. Sanborn. v. athenahealth, Inc., No. 17-cv-12125 (D. Mass.) and United States ex rel. Lovell and McKusick v. athenahealth, Inc., No. 17-cv-12543 (D. Mass.). The claims resolved by the settlement are allegations only and there has been no determination of liability.
Eight defendants sentenced for distribution of methamphetamine in Operation Night TrainRead the Press Release
GAINESVILLE, Ga. – Eight defendants have been sentenced for conspiracy to distribute methamphetamine, possession with the intent to distribute methamphetamine, and money laundering as part of Operation Night Train, a long-term Organized Crime Drug Enforcement Task Forces (OCDETF) investigation in Gainesville, Georgia.
“Methamphetamine continues to plague our communities,” said Acting U.S. Attorney Bobby L. Christine. “This prosecution demonstrates that our federal, state, and local partners remain committed to taking these dangerous drug dealers off of our streets. We are grateful to the many law enforcement agencies who partnered with us on these cases.”
“Because of the results of this case our communities are safer and other drug traffickers in Georgia have been put on notice that we will not tolerate their efforts to spread these dangerous drugs,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “They will face the combined force of our federal, state and local law enforcement partners.”
“Georgians deserve to live in a safe and drug-free environment. We will continue to work diligently with all of our partners to investigate and dismantle drug trafficking organizations that threaten the safety of our communities,” said Vic Reynolds, Director, Georgia Bureau of Investigation.
According to Acting U.S. Attorney Christine, the charges and other information presented in court: Teofilo Carlos Santana Medrano ran a multi-kilogram methamphetamine distribution organization in the Gainesville, Georgia, area. He was supplied by Maria Maldonado and Salome Urieta Jaimes. Santana distributed methamphetamine to other members of his organization.
Eight defendants in the case have been sentenced after pleading guilty:
- Timothy Barnes, 53, of Jasper, Georgia, was sentenced on January 28, 2021, to 11 years, eight months in prison, to be followed by 10 years of supervised release. Barnes was convicted on September 8, 2020, after he pleaded guilty to possession with the intent to distribute methamphetamine.
- Teofilo Carlos Santana Medrano, 29, of Gainesville, Georgia, was sentenced on October 14, 2020, to 18 years in prison to be followed by five years of supervised release. Santana was convicted on February 19, 2020 after he pleaded guilty to conspiracy to distribute methamphetamine.
- Michael Johnny Davis, 57, of Canton, Georgia, was sentenced on October 26, 2020, to four years, nine months in prison to be followed by six years of supervised release. Davis was convicted on July 23, 2020, after he pleaded guilty.
- Maria Isabel Gonzalez Maldonado, a/k/a Lili, 38, of Atlanta Georgia, was sentenced on November 20, 2020, to eight years, one month in prison to be followed by five years of supervised release. Maldonado was convicted on March 19, 2020, after she pleaded guilty to conspiracy to possess methamphetamine.
- John Johnson, 50, of Mershon, Georgia, was sentenced on November 20, 2020, to three years, eight months in prison to be followed by four years of supervised release. Johnson was convicted on August 13, 2020, after he pleaded guilty to possession with the intent to distribute methamphetamine.
- Mitchell Lingerfelt, 45, of Ball Ground, Georgia, was sentenced on October 29, 2020, to five years, three months in prison to be followed by seven years of supervised release. Davis was convicted on July 23, 2020, after he pleaded guilty to conspiracy to possess methamphetamine with the intent to distribute and possession with the intent to distribute methamphetamine.
- Carlos Neftali Lemus Salmeron, 29, of Lawrenceville, Georgia, was sentenced on August 14, 2020, to six years in prison to be followed by five years of supervised release. Salmeron was convicted on September 3, 2019, after he pleaded guilty to possession with the intent to distribute methamphetamine.
- Salome Urieta Jaimes, a/k/a “Gucci”, 39, of Guerrero, Mexico was sentenced on August 14, 2020, to nine years, two months in prison to be followed by three years of supervised release, and ordered to pay restitution in the amount of $200.00. Jaimes was convicted on January 31, 2020, after he pleaded guilty to possession with the intent to distribute methamphetamine and money laundering.
The remaining defendant, Lesli Arroyo Alvarado, 24, of Lawrenceville, Georgia, pleaded guilty to possession with the intent to distribute methamphetamine on July 2, 2020. She fled prior to her sentencing. Anyone with information regarding her whereabouts is asked to contact to the FBI.
This case is being investigated by the Federal Bureau of Investigation, the FBI North Georgia Major Offenders Task Force, the Department of Homeland Security Investigations, the Georgia Bureau of Investigation, the Hall County Sheriff’s Office, the Rhea County, Tennessee, Sherriff’s Office, the GBI Appalachian Regional Drug Enforcement Office, the Georgia National Guard Counter Drug Task Force, and the Georgia Department of Public Safety.
Assistant U.S. Attorney Calvin A. Leipold, III and former Assistant U.S. Attorney William McKinnon prosecuted the case.
This effort is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
The U.S. Attorney’s Office in Atlanta recommends parents and children learn about the dangers of drugs at the following web site: www.justthinktwice.gov.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Duplin County Methamphetamine Trafficker Receives 90 Months in Federal PrisonRead the Press Release
WILMINGTON, N.C. – Ashley Shackelford, 35, of Duplin County, was sentenced yesterday to 90 months imprisonment for: (1) Conspiracy to Possess with the Intent to Distribute and Distribute 500 grams of a mixture and substance containing Methamphetamine; and (2) Possess with the Intent to Distribute of 500 grams of a mixture of substance containing Methamphetamine.
The evidence presented in court revealed that on June 30, 2020, the Drug Enforcement Administration, (DEA) working with the Duplin County Narcotics Detectives, received information that Shackelford had recently been in possession of several ounces of methamphetamine and a firearm at her residence. Agents developed additional information that Shackelford and another person were traveling to Atlanta, Georgia to pick up two pounds of methamphetamine and then returning to Eastern North Carolina. On July 1, 2020, Sampson County Detectives stopped a car driven by Shackelford with a passenger in Newton Grove. Detectives found more than a kilogram and half of methamphetamine in the car. During the investigation law enforcement discovered that Shackelford had assisted in the delivery of more than two and a half kilograms of methamphetamine from Atlanta to Eastern North Carolina during 2020.
Additionally, in separate investigations, in February 2020, Mount Olive Police Officers conducted two controlled purchases of an ounce of methamphetamine on each occasion from Shackelford at her residence. On December 2, 2017, Wayne County Sheriff’s Deputies conducted a consensual search of Shackelford’s residence and found approximately 4 ounces of methamphetamine.
The investigation was part of an Organized Crime Drug Enforcement Task Force (OCDETF) operation. OCDETF is a joint federal, state, and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional level drug trafficking organizations, and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets. This OCDETF focuses on a Multi-State Drug Trafficking Organization and Gang Activity that has been responsible for the distribution of large quantities of extremely pure methamphetamine throughout the United States.
Robert J. Higdon, Jr., U.S. Attorney for the Eastern District of North Carolina made the announcement after the sentencing before Chief U.S. District Judge Richard E. Myers II. The Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Duplin, Sampson and Wilson County Sheriffs’ Offices and the Mount Olive Police Department took part in the investigation. Assistant U.S. Attorney Timothy Severo prosecuted the case.
Related court documents and information can be found on the website of the U.S. District Court for the Eastern District of North Carolina or on PACER by searching for Case No. 7:20-cr-00130-M-2.
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Drug Treatment Clinic Owner Indicted for Drug TraffickingRead the Press Release
KANSAS CITY, Mo. – The owner of an Olathe, Kansas, clinic that treats opioid addiction has been indicted by a federal grand jury for drug trafficking.
Trevor J. Robinson, 44, of Olathe, Kansas, was charged in a five-count indictment returned by a federal grand jury on Tuesday, Jan. 26. Robinson was arrested today and remains in federal custody pending a detention hearing.
Robinson owned and operated Nuvista, LLC, a Suboxone (opioid addiction) clinic in Olathe.
The federal indictment charges Robinson with one count each of possessing with the intent to distribute methamphetamine, cocaine, heroin, fentanyl, and ecstasy.
On Oct. 22, 2020, Robinson was allegedly in possession of the illegal drugs when he was stopped by Kansas City police officers while driving his 2014 Maserati. When Robinson was arrested on an outstanding warrant, officers found a plastic bag containing 15 white round pills imprinted with “M30” in his front right pocket and $900 in his wallet. A subsequent search of his vehicle revealed a grey backpack on the front passenger’s seat. The backpack contained a digital scale, plastic bags containing approximately 1.5 kilograms of methamphetamine, plastic bags containing cocaine and heroin, several plastic bags containing various pills, including MDMA/ecstasy, a plastic bag containing marijuana, $12,548 in cash, and a leather-bound ledger notebook.
The charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Ashleigh A. Ragner. It was investigated by the Kansas City, Mo., Police Department, the FBI, and the Northeast Kansas Drug Task Force.
Department of Justice Announces Arrests in Conspiracy and Dog Fighting Ring InvestigationRead the Press Release
An indictment was unsealed today charging 11 individuals on a 136-count federal indictment including violations of drug conspiracy, drug possession, and drug possession with the intent to distribute, and violations of the dog fighting prohibitions of the federal Animal Welfare Act, and conspiracy to commit the same.
The defendants include: Jarvis Lockett, 40, of Warner Robins, Georgia; Derrick Owens, 37, of Woodland, Georgia; Christopher Raines, 50, of Talbotton, Georgia; Armard Davis, 41, of Fort Valley, Georgia; Jason Carter, 38, of Phoenix City, Alabama; Shaquille Bentley, 26, of Roberta, Georgia; Bryanna Holmes, 24, of Fort Valley, Georgia; Vernon Vegas, 49, of Suwanee, Georgia; Lekey Davis, 45, of Talbotton, Georgia; Kathy Ann Whitfield, 61, of Columbus, Georgia; and Rodrick Walton, 40, of Shiloh, Georgia.
“As this case demonstrates, we continue to aggressively prosecute dog fighters and those who work together to support and further their inhumane criminal activities,” said Jean Williams, Deputy Assistant Attorney General of the Justice Department’s Environment and Natural Resources Division. “We thank our federal and local law enforcement partners who made this operation possible.”
“Dog fighting is brutal and illegal; it is particularly troubling when combined with drug trafficking,” said Peter D. Leary, Acting U.S. Attorney for the Middle District of Georgia. “We will investigate and prosecute individuals who engage in these criminal acts and seek justice for all of their victims. I thank our law enforcement partners for their hard work on this significant investigation.”
The indictment alleges that defendants Lockett, Owens, Raines, A. Davis, Carter, Bentley, Holmes, Vegas, L. Davis, and Whitfield were involved in a conspiracy between May 2019 and February 2020 to possess with intent to distribute five kilograms or more of cocaine and 28 grams or more of cocaine base. Lockett is charged in separate counts with distribution of cocaine base and cocaine, and possession with the intent to distribute cocaine base and cocaine. A. Davis and Holmes are charged in separate counts with possession with intent to distribute cocaine base and cocaine. Walton is charged in a separate count with possession of cocaine.
The indictment further alleges that defendants Lockett, Owens, Raines, A. Davis, and Walton were involved in a conspiracy to sponsor and exhibit dogs in a dog fight, and possess, train, transport, deliver, and receive dogs for the purpose of having the dogs participate in a dog fight. The indictment outlines dog fights the defendants are alleged to have attended between May 2019 and February 2020, as well as discussions between the co-conspirators about training and matching up their dogs for fighting. In addition, the defendants are separately charged with possession of dogs for purposes of having the dogs participate in dog fights as follows: Lockett – 15 counts; Raines – 40 counts; Owens – 44 counts, Walton – 18 counts; A. Davis – nine counts.
This matter is being investigated by the Drug Enforcement Administration and the U.S. Department of Agriculture-Office of Inspector General with assistance from the U.S. Marshals Service, Southeast Regional Fugitive Task Force, and local law enforcement agencies. Senior Trial Attorney Jennifer Blackwell of the Environment and Natural Resources Division’s Environmental Crimes Section and Assistant U.S. Attorney William Keyes are prosecuting the case.
A federal criminal indictment is merely an accusation. A defendant is presumed innocent unless and until proven guilty.
Chicago Investment Manager Detained in Indonesia and Returned to Chicago to Face Federal Fraud ChargesRead the Press Release
CHICAGO — A Chicago investment manager who fled the country after being charged in a fraud scheme has been returned to the United States from Indonesia.
MARCUS BEAM was indicted in January 2020 on charges he fraudulently obtained money from women he met online. According to the indictment, Beam falsely claimed to the women and other investors that their funds would be invested in stocks such as Uber and Lyft. Beam instead spent the money for his own personal benefit, including rent, auto loans, and retail purchases, resulting in a loss to investors of at least $500,000, the indictment alleges.
Beam, 50, of Woodridge, fled the United States after being released on bond in January 2020. The U.S. Marshals Service located Beam in Bali, Indonesia, and he was detained there in July 2020 on an INTERPOL Red Notice by the Indonesia National Police, National Central Bureau, and INTERPOL. On Jan. 27, 2021, Beam was deported from Indonesia and returned in custody to Chicago. He pleaded not guilty to ten counts of wire fraud and mail fraud during his arraignment Wednesday afternoon before U.S. Magistrate Judge Heather K. McShain in Chicago.
The arraignment was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; William Hedrick, Inspector-in-Charge of the U.S. Postal Inspection Service in Chicago; Jeffrey A. Monhart, Regional Director of the Chicago Regional Office of the U.S. Department of Labor, Employee Benefits Security Administration; Tanya Solov, Director of the Illinois Securities Department of the Illinois Secretary of State; and David Gelement, Chief Deputy U.S. Marshal. The government is represented by Assistant U.S. Attorney Jacqueline Stern.
The officials acknowledged the substantial assistance of the news media whose coverage generated leads prior to Beam’s apprehension in Indonesia. The officials also acknowledged the substantial assistance of the Indonesian National Police, National Central Bureau, INTERPOL, the Directorate General of Immigration, and the Bali Regional Police. The Justice Department’s Office of International Affairs provided assistance in securing the defendant’s return from Indonesia.
The public is reminded that an indictment is not evidence of guilt. The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. Each count in the indictment is punishable by up to 20 years in prison. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.
Download Beam indictment
Cedar Rapids Doctor Agrees to Pay $100,000 to Resolve Allegations that He Overprescribed Opioids in Violation of the Controlled Substances ActRead the Press Release
Dr. Paul Lottes, a family medicine physician in Cedar Rapids, Iowa, has agreed to pay $100,000 to resolve allegations that he violated the Controlled Substances Act by writing prescriptions for opioid medications that had no legitimate medical purpose and were not issued in the usual course of professional practice.
The United States alleges that from August 2017 to April 2019, Dr. Lottes wrote prescriptions for opioids classified as Schedule II controlled substances for two patients that had no legitimate medical purpose and were not issued in the usual course of professional practice, in violation of the Controlled Substances Act.
In addition to agreeing to pay the $100,000 settlement, Dr. Lottes has also agreed not to reapply for a controlled substances registration with the Drug Enforcement Administration (“DEA”) for a period of three years. Without the DEA registration, Dr. Lottes will not be able to prescribe controlled substances during this time.
“Overprescribing is a major factor in the devastating opioid epidemic facing our country,” said U.S. Attorney Peter E. Deegan. “As this settlement demonstrates, our office is committed to using all available tools to fight this epidemic, including civil prosecution under the Controlled Substances Act.”
“Doctors who prescribe controlled substances outside the bounds of professional practice betray their oaths as practitioners and also fail the patients who trust them for care,” DEA Omaha Division Diversion Program Manager Sarah Boblenz said. “DEA and its partners at the federal, state and local level will continue to investigate all practitioners who cause harm to the public and fuel the opioid epidemic.”
This matter was handled by Assistant U.S. Attorney Melissa Carrington and investigated by the State of Iowa’s Medicaid Fraud Control Unit and the DEA.
The claims resolved by this settlement are allegations only, and there has been no determination of liability.
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Butte felon sentenced to prison in firearms crimeRead the Press Release
GREAT FALLS — A Butte man having been convicted of a felony was sentenced today to 38 months in prison and three years of supervised release for illegally possessing a gun, Acting U.S. Attorney Leif Johnson said.
Joseph Alfred Edward Lytell Torres, 30, pleaded guilty on Oct. 1, 2020 to prohibited person in possession of a firearm.
Chief U.S. District Judge Brian M. Morris presided. Torres was detained.
In court documents filed by the prosecution, officers with Butte-Silver Bow Law Enforcement responded on May 12, 2020 to an area behind a Butte residence where a caller informed officers she had seen a male driving a motorcycle with a gun in his hand and heard a “pop, pop.” Officers found a vehicle with a flat tire in the area and two spent 9mm shell casings on the ground. Officers recovered bullet fragments in the wheel and on the ground. Officers contacted the owner of the vehicle, who said she was sitting in the vehicle when it was shot. The owner identified Torres as the shooter.
Law enforcement officers and Montana Probation and Parole officers located Torres two days later at his residence and arrested him. Officers search the garage and found a 9mm pistol under a stack of tires. At the time, Torres was a convicted felon on state supervision.
Assistant U.S. Attorney Paulette Stewart prosecuted the case, which was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, Butte-Silver Bow Law Enforcement and Montana Department of Corrections’ Probation and Parole.
This case is part of Project Guardian, a Department of Justice initiative launched in the fall of 2019 to reduce gun violence and enforce federal firearms laws. Through Project Guardian, the U.S. Attorney’s Office in the District of Montana is working to enhance coordination of its federal, state, tribal and local law enforcement partners in investigating and prosecuting gun crimes. In addition, Project Guardian supports information sharing and taking action when individuals are denied a firearm purchase by the National Instant Criminal Background Check System for mental health reasons or because they are a prohibited person.
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Businessman Sentenced for Foreign Bribery and Money Laundering Scheme Involving PetroEcuador OfficialsRead the Press Release
An Ecuadorian businessman living in Miami was sentenced today to 35 months in prison for his role in a $4.4 million bribery and money laundering scheme that funneled bribes to then-public officials of Empresa Pública de Hidrocarburos del Ecuador (PetroEcuador), the state-owned and state-controlled oil company of Ecuador.
Nicholas L. McQuaid, Acting Assistant Attorney General of the Justice Department’s Criminal Division and George L. Piro, Special Agent in Charge of the FBI’s Miami Field Office made the announcement.
According to his plea, Armengol Alfonso Cevallos Diaz, 58, admitted that from 2012 through 2015 he conspired to solicit, intermediate, and pay bribes of $4.4 million from an oil services company and companies associated with or controlled by Cevallos to PetroEcuador officials by using U.S.-based companies and U.S.-based bank accounts in order to obtain and retain business from PetroEcuador. Cevallos also admitted to conspiring to conceal and promote the bribe scheme by laundering the funds through Miami-based shell companies and bank accounts that were used to acquire properties in the Miami area for the benefit of certain PetroEcuador officials.
Cevallos is the latest individual to be sentenced in the Justice Department’s ongoing investigation into bribery and money laundering involving PetroEcuador. The individuals prosecuted include former PetroEcuador officials who received and concealed the bribe payments, businessmen and contractors who paid the bribes to obtain contracts from PetroEcuador, and intermediaries who enabled and facilitated the bribery through the use of U.S. and offshore companies and bank accounts.
The FBI’s International Corruption Squad in Miami is investigating the case.
Trial Attorneys Jonathan Robell and Katherine Raut of the Criminal Division’s Fraud Section and Trial Attorney Randall Warden of the Criminal Division’s Money Laundering and Asset Recovery Section (MLARS) prosecuted the case.
IRS-Criminal Investigation, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the U.S. Marshals Service and the Justice Department’s Office of International Affairs provided significant assistance in this case, as have public authorities in, among other countries, Ecuador and Panama.
MLARS’s Bank Integrity Unit investigates and prosecutes banks and other financial institutions, including their officers, managers, and employees, whose actions threaten the integrity of the individual institution or the wider financial system.
The Fraud Section is responsible for investigating and prosecuting all Foreign Corruption Practices Act (FCPA) matters. Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.
Athenahealth Agrees to Pay $18.25 Million to Resolve Allegations that It Paid Illegal KickbacksRead the Press Release
BOSTON – athenahealth, Inc. (Athena), a Watertown-based developer of electronic health records (EHR) services, has agreed to pay $18.25 million to resolve allegations that it violated the False Claims Act (FCA) by paying illegal kickbacks to generate sales of its EHR product, athenaClinicals.
In a complaint filed in conjunction with today’s settlement, the United States alleged that Athena violated the FCA and the Anti-Kickback Statute through three marketing programs. First, Athena allegedly invited prospects and customers to all-expense-paid sporting, entertainment and recreational events. The most lavish of these events, such as “bucket list” trips to the Masters Tournament and the Kentucky Derby, included complimentary travel along with luxury accommodations, meals and alcohol. Second, Athena allegedly paid illegal fees to its customers through its “Lead Generation” program designed to identify new prospective customers. Under this program, Athena paid up to $3,000 per physician that signed up for Athena services, regardless of how much time (if any) the client spent speaking or meeting with the lead. Finally, it is alleged that Athena entered into deals with competing companies that had decided to discontinue their health information technology products. Pursuant to those agreements, known as “Conversion Deals,” the other companies agreed to refer their clients to Athena, and Athena paid competitors based on the value and volume of practices that were successfully converted into Athena customers.
As a result of these kickbacks, it is alleged that Athena improperly generated sales for itself while causing healthcare providers to submit false claims to the federal government related to incentive payments for adoption and “meaningful use” of Athena’s EHR technology.
“Across the country, physicians rely on electronic health records software to provide vital patient data. Kickbacks corrupt the market for health care services and risk jeopardizing patient safety,” said United States Attorney Andrew E. Lelling. “We will aggressively pursue organizations that fail to play by the rules; EHR companies are no exception.”
“This resolution demonstrates the department’s continued commitment to holding EHR companies accountable for the payment of unlawful kickbacks in any form,” said Acting Assistant Attorney General Brian Boynton for the Department of Justice’s Civil Division. “EHR technology plays an important role in the provision of medical care, and it is critical that the selection of an EHR platform be made without the influence of improper financial inducements.”
“If the benefits of Electronic Health Records are to be fully realized, patients must be confident providers have selected the most effective system – not the one paying the largest kickbacks. Time and again, we’ve seen fraudulent activity undermine the integrity of medical decisions, subvert the health marketplace, and waste taxpayer dollars,” said Phillip M. Coyne, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services. “We will continue to hold accountable those who provide illegal incentives in order to influence the decision-making of health care providers.”
“It is illegal for companies to extend invitations to all-expense-paid sporting, entertainment, and recreational events, and other perk-filled offers to its prospective customers to win business and boost their bottom line through illegal kickback schemes,” said Joseph R. Bonavolonta, Special Agent in Charge of the FBI Boston Division. “Today’s agreement by Athena to pay $18.25 million should send a strong message to anyone thinking about engaging in this type of illegal activity. The FBI will continue to work with our law enforcement partners to do everything in our power to safeguard our government health care programs and the taxpayers picking up the bill.”
The settlement with Athena also resolves allegations in two whistleblowers lawsuits. Under the qui tam provisions of the False Claims Act, private individuals, known as relators, can sue on behalf of the government for false claims and share in any recovery.
U.S. Attorney Lelling, Acting Assistant Attorney General Boynton, HHS-OIG SAC Coyne, FBI Boston SAC Bonavolonta and Matthew Modafferi, Special Agent in Charge of the U.S. Postal Service Office of Inspector General, Northeast Area Field Office made the announcement today. The matter was handled by Assistant U.S. Attorneys Jessica J. Weber, David J. Derusha and Gregg Shapiro of Lelling’s Affirmative Civil Enforcement Unit, together with Trial Attorneys Nicholas Perros and Andrew Jaco of the Justice Department’s Civil Division.
Armed Drug Dealer Sentenced to 6 YearsRead the Press Release
MADISON, WIS. - Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Verdell Thomas, 21, Madison, Wisconsin, was sentenced today by U.S. District Judge James D. Peterson to six years in federal prison for possessing crack cocaine with intent to distribute, and for possessing a loaded firearm in furtherance of that offense. Thomas pleaded guilty to these charges on October 6, 2020.
A confidential informant working with the Dane County Narcotics Task Force (DCNTF) purchased small quantities of crack cocaine from Thomas on three occasions in 2020. Based on those controlled buys, DCNTF had probable cause to arrest Thomas. Thomas was arrested at a local gas station on May 7, 2020. He had 6.6 grams of crack cocaine, a scale, over $4,000, and a loaded 9mm pistol, all in his pants pockets.
At the time of his arrest, Thomas was on probation for a December 17, 2019, felony conviction for possession with intent to deliver cocaine in Dane County. Thomas told law enforcement officers he was armed because “everyone is” and he had to protect his drugs. Judge Peterson ordered the six-year sentence to be served consecutively to an 18-month state revocation sentence Thomas is currently serving for the Dane County conviction.
Judge Peterson rejected Thomas’ request for a sentence of five years and one day, because Thomas is a dangerous young man, with an extensive criminal history that includes acts of violence.
This case has been brought as part of Project Safe Neighborhoods (PSN), the U.S. Justice Department’s program to reduce violent crime. The PSN approach involves collaboration by federal, state and local law enforcement agencies, prosecutors and communities to prevent and deter gun violence.
The charges against Thomas were the result of an investigation conducted by the Dane County Narcotics Task Force. The prosecution of the case has been handled by Assistant U.S. Attorney Rita M. Rumbelow.
A La Grange, NC Man Receives More Than 12 Years in PrisonRead the Press Release
WILMINGTON, N.C. – A La Grange, North Carolina man, Osvaldo Fuentez-Buentello, age 49, was sentenced yesterday to a total of 148 months in prison for conspiracy to possess and possess with the intent to distribute five (5) kilograms or more of cocaine, fifty (50) grams or more of a mixture and substance containing a detectable amount of methamphetamine, and twenty-eighty (28) grams or more of cocaine base (crack). In addition, Buentello was sentenced for possession with intent to distribute fifty (50) grams or more of a mixture and substance containing a detectable amount of methamphetamine, a quantity of cocaine and possession of a firearm in furtherance of a drug trafficking crime.
According to court documents, on February 19, 2020, a cooperating defendant in New Hanover County ordered a shipment of methamphetamine and cocaine from Buentello. In route from a stash house in La Grange, North Carolina, in Lenoir County, New Hanover County Sheriff’s Office Deputies tracked Buentello and stopped his Chevrolet truck as it entered New Hanover County. Buentello was the sole occupant of the truck. A K-9 unit responded, and the K-9 gave a positive alert for the presence of narcotics. Deputies searched the truck and found approximately 5 ounces of methamphetamine and 9 ounces of cocaine in a boot behind the passenger’s seat. A 9mm High Point handgun was found in the center console.
Following the traffic stop, law enforcement conducted a search of Buentello’s stash house in La Grange and found more than 400 grams of marijuana, more than 100 grams of cocaine and more than 28 grams of cocaine base (crack). Law enforcement also located more than $40,000.00. Buentello provided a statement to law enforcement following his arrest and indicated that he dealt in kilogram levels of cocaine for 8 years prior to his arrest and ounce levels of methamphetamine for several months prior to his arrest.
Robert J. Higdon, Jr., U.S. Attorney for the Eastern District of North Carolina made the announcement after sentencing by Chief U.S. District Judge Richard E. Myers II. The New Hanover County Sheriff’s Office, Wayne County Sheriff’s Office, and the Drug Enforcement Administration (DEA) investigated the case and Special Assistant U.S. Attorney Murphy Averitt prosecuted the case.
This case is part of the Take Back North Carolina Initiative of The United States Attorney’s Office for the Eastern District of North Carolina. This initiative emphasizes the regional assignment of federal prosecutors to work with law enforcement and District Attorney’s Offices on a sustained basis in those communities to reduce the violent crime rate, drug trafficking, and crimes against law enforcement.
Related court documents and information can be found on the website of the U.S. District Court for the Eastern District of North Carolina or on PACER by searching for Case No. 7:20-cr-00047-M.
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Wednesday 27 January 2021
Wilmington Man Sentenced to 84 Months for Gun OffenseRead the Press Release
RALEIGH, N.C. – A Wilmington man was sentenced today to 84 months in prison for possession of a firearm by a convicted felon.
According to court documents, Marquan Kyemeke Gibbs, 30, was charged with one count of felon in possession of a firearm. Gibbs pled guilty on November 17, 2020.
On April 13, 2020, while on probation for multiple offenses – including a prior state conviction for possession of a firearm by a felon – Gibbs was in the back seat of a car that was subject to a traffic stop. Gibbs failed to comply with law enforcement commands and was removed from the vehicle. A subsequent search revealed a 9mm handgun in Gibbs’ pocket, with a 30-round high capacity magazine containing 27 rounds in a different pocket. The gun was stolen from a home on Wrightsville Avenue in Wilmington during an August 8, 2019 breaking and entering. On October 1, 2019, a very similar breaking and entering of another Wrightsville Avenue home resulted in four other guns being stolen, one of which was later recovered from a juvenile. Investigators obtained fingerprints from the scene of the October 1, 2019 breaking and entering that matched Gibbs.
Robert J. Higdon, Jr., U.S. Attorney for the Eastern District of North Carolina made the announcement after sentencing by U.S. District Judge Terrence W. Boyle. The North Carolina 6th Judicial District Attorney’s Office, Wilmington Police Department, and Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”) investigated the case and Assistant U.S. Attorney Bryan Stephany prosecuted the case.
This case is also 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 United States Attorney’s Office for the Eastern District of North Carolina implements the PSN Program through its Take Back North Carolina Initiative. This initiative emphasizes the regional assignment of federal prosecutors to work with law enforcement and District Attorney’s Offices on a sustained basis in those communities to reduce the violent crime rate, drug trafficking, and crimes against law enforcement.
Related court documents and information can be found on the website of the U.S. District Court for the Eastern District of North Carolina or on PACER by searching for Case No. 7:20-CR-00096-BO.
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Waterbury Heroin Trafficker Sentenced to 10 Years in Federal PrisonRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that KEITH JORDAN, also known as “Knowledge,” 52, of Waterbury, was sentenced today by U.S. District Judge Janet C. Hall to 120 months of imprisonment, followed by five years of supervised release, for trafficking heroin.
Pursuant to the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), the court proceeding occurred via videoconference.
According to court documents and statements made in court, this matter stems from a joint investigation headed by the DEA New Haven Task Force and the Waterbury and Naugatuck Police Departments. The investigation, which included the use of court-authorized wiretaps, physical surveillance and controlled purchases of narcotics, revealed that Jordan was receiving large quantities of heroin from various suppliers and selling the drug to other drug distributors and street-level customers. Jordan also purchased and distributed cocaine.
On March 13, 2019, a grand jury in Hartford returned an indictment charging Jordan and 28 other individuals with various offenses related to the distribution of heroin, fentanyl, cocaine and crack cocaine.
Jordan and several codefendants were arrested on March 20, 2019. In association with the arrests, investigators seized approximately 3,000 bags of heroin, 400 grams of cocaine, 350 grams of fentanyl/heroin mixed, 400 grams of heroin, 10 grams of crack, 20 pounds of marijuana, fentanyl patches, a one-kilogram press, four handguns, approximately $120,000 in cash and four vehicles.
On January 23, 2020, Jordan pleaded guilty to one count of conspiracy to distribute, and to possess with intent to distribute, one kilogram or more of heroin.
Jordan, who is released on a $250,000 bond, is required to report to prison on March 31, 2021.
This investigation has been conducted by the Drug Enforcement Administration New Haven Task Force, Waterbury Police Department and Naugatuck Police Department, with the critical assistance of the U.S. Secret Service, New York Field Office. The DEA New Haven Task Force includes participants from the U.S. Marshals Service, Internal Revenue Service – Criminal Investigation Division, and the New Haven, Hamden, West Haven, North Haven, Branford, Ansonia, Meriden, Derby, Middletown, Naugatuck and Waterbury Police Departments.
The case is being prosecuted by Assistant U.S. Attorneys S. Dave Vatti and Nathaniel J. Gentile through the Organized Crime Drug Enforcement Task Forces (OCDETF) Program. OCDETF identifies, disrupts and dismantles drug traffickers, money launderers, gangs and transnational criminal organizations through a prosecutor-led and intelligence-driven approach that leverages the strengths of federal, state and local law enforcement agencies. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
Washington, PA Man Charged with Federal Drug CrimeRead the Press Release
PITTSBURGH – A resident of Washington, Pennsylvania, has been indicted by a federal grand jury in Pittsburgh on a charge of violating federal narcotics laws, United States Attorney Scott W. Brady announced today.
The one-count Indictment named Patrick Ellis, 43, as the sole defendant.
According to the Indictment, on or about November 19, 2020, Ellis possessed with the intent to distribute 500 grams or more of cocaine, a Schedule II controlled substance.
The law provides for a maximum total sentence of not less than 5 to a maximum of 40 years in prison, a fine not to exceed $5,000,000 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Mark V. Gurzo is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation ("FBI") in Pittsburgh, PA led the multi-agency investigation that included members of the Pennsylvania State Police, United States Postal Inspection Service, Allegheny County Police Department, Allegheny County Port Authority Police Department, Allegheny County Sherriff’s Office, Pittsburgh Bureau of Police, Stowe Township Police Department, and North Versailles Police Department.
This prosecution is a result of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles high-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten communities throughout the United States. OCDETF uses a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Waldoboro Man Pleads Guilty to Social Security FraudRead the Press Release
PORTLAND, Maine: A Waldoboro man pleaded guilty yesterday in federal court to Social Security fraud, U.S. Attorney Halsey B. Frank announced.
According to court records, from about February 2000 through May 2018, Wayne Flaherty, 53, a recipient of Supplemental Security Income (“SSI”), concealed his receipt of money from another individual to maintain his eligibility to receive benefit payments. SSI benefits are paid to people with limited income who are blind, disabled or elderly. Flaherty was reportedly receiving at least $1,500 per month from this individual at the time he applied for benefits, but the amounts increased over the years, with Flaherty receiving a total of at least $846,615.18 from February 2012 through July 2017. The individual also provided Flaherty with a home in February 2012.
Flaherty did not notify the Social Security Administration (“SSA”) that he was receiving these payments at any point during the time he was receiving SSI payments, despite knowing he was required to report them. At an interview with law enforcement agents, he admitted to concealing this information from SSA because he was afraid his benefits would have stopped.
Flaherty faces up to five years in prison and a fine of up to $250,000, and up to three years of supervised release. He will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
SSA’s Office of the Inspector General, the Maine Department of Health & Human Services, the Lincoln County Sheriff’s Office and the Knox County Sheriff’s Office investigated the case.
Violent Felon Sentenced to 8 Years in Federal PrisonRead the Press Release
A six-time convicted violent felon who was found in possession of a sawed-off rifle was sentenced today in federal court, announced U.S. Attorney Trent Shores.
U.S. District Judge John F. Heil III sentenced Devante Joe-Joe Youngblood, 27, of Stroud, to 96 months in federal prison followed by three years of supervised release. In October 2020, Youngblood pleaded guilty to being a felon in possession of a firearm.
Youngblood was found in possession of a Henry Repeating Arms Co .22LR caliber weapon made from a rifle on July 15, 2020. Youngblood was previously convicted of second degree rape, possession of a controlled dangerous substance, assault and battery on a police officer, attempted escape from custody, assault with a dangerous weapon, and escape from arrest and detention. Relevant conduct was also cited by the Government at the defendant’s plea hearing and sentencing. The Government alleged specific facts related to a shooting or attempted shooting and robbery involving Youngblood and the firearm prior to his arrest by law enforcement.
“Devante Youngblood was a gun-wielding alpha criminal who repeatedly put others at risk. He is a danger to our communities,” said U.S. Attorney Trent Shores. “Felons like Youngblood are the reason why our 2150 Initiative prosecutions are so important. This conviction is a result of the good work of the ATF, Stroud and Bristow Police Departments, and Assistant U.S. Attorney Cymetra Williams. Today, Youngblood’s actions have landed him in prison for the next eight years where he can no longer terrorize fellow Oklahomans.”
The Bristow Police Department, Stroud Police Department, and Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) conducted the investigation. Assistant U.S. Attorney Cymetra M. Williams prosecuted the case. Ms. Williams is a prosecutor from the U.S. Attorney’s Office in the District of New Jersey. She volunteered to assist prosecution efforts here in the Northern District of Oklahoma due to the increased volume of cases since the Supreme Court’s ruling which stated the Creek Nation Reservation had never been officially disestablished by Congress. The United States and the Muscogee (Creek) Nation have jurisdiction of all cases that occur on the reservation involving Native American victims or defendants.
This case was prosecuted as part of the 2150 Initiative. The collaborative law enforcement initiative between the U.S. Attorney’s Office for the Northern District of Oklahoma, Tulsa Police Department, ATF, and all other local, state, tribal and federal law enforcement partners combats violent crime by focusing efforts on prohibited persons in possession of firearms as well as those responsible as the “source” of the firearms to prohibited persons. The initiative was named in memory of Tulsa Police Sergeant Craig Johnson. Sgt. Johnson’s badge number, 2150, was selected for the initiative as a way to honor his life and his commitment to the Tulsa community. This case is also part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws.
Vermont Man Pleads Guilty to Possession of a Firearm by a Prohibited PersonRead the Press Release
CONCORD - David Bentley, 29, of Rutland, Vermont pleaded guilty in federal court on Tuesday to possession of a firearm by a convicted felon, United States Attorney Scott W. Murray announced today.
According to court documents and statements made in court, on November 29, 2018, law enforcement officers conducted a traffic stop of a vehicle driven by Bentley. He was arrested for operating a vehicle after suspension of his license. After obtaining a search warrant for the vehicle, officers found a loaded firearm in the backseat. Bentley is legally prohibited from possessing firearms by virtue of a felony conviction for burglary in 2010.
Bentley is scheduled to be sentenced on May 3, 2021.
“In order to maintain public safety, it is vital to keep guns out of the hands of criminals,” said U.S. Attorney Murray. “We will continue to work closely with our law enforcement partners to identify and prosecute convicted felons who unlawfully possess guns.”
This matter was investigated by the Drug Enforcement Administration with assistance from the New Hampshire State Police Mobile Enforcement Team, the Bureau of Alcohol, Tobacco, Firearms and Explosives, New Hampshire Attorney General’s Drug Task Force, Claremont Police Department, Vermont State Police, and the Springfield, Vermont Police Department. The case is being prosecuted by Assistant U.S. Attorney Anna Krasinski.
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United States Files False Claims Act Complaint Alleging Compounding Pharmacy Kickback SchemeRead the Press Release
United States Attorney Maria Chapa Lopez announces that the government has filed a civil lawsuit against Mihir Taneja alleging that Taneja conspired with Larry Smith, the owner of Z Stat Medical, LLC d/b/a Oldsmar Pharmacy, to enter into a kickback arrangement with a marketing company (Centurion Compounding, Inc.), which led to millions of dollars in TRICARE reimbursement for compounding prescriptions. Specifically, the lawsuit alleges that Taneja and Smith negotiated an arrangement with Centurion in which Centurion was paid a percentage of profits from TRICARE claims that Centurion referred to Oldsmar Pharmacy. As a result, from November 2014 to February 2015, Oldsmar Pharmacy submitted thousands of claims for reimbursement to TRICARE for compounded drugs that were tainted by kickbacks and, therefore, were false.
The actions of Taneja and his co-conspirators contributed to a larger fraud trend against TRICARE involving compounded prescriptions. TRICARE’s costs for compounded drugs skyrocketed during this period, rising from $5 million in 2004 to $514 million in 2014, before reaching a high water mark of $1.75 billion in fiscal year 2015. To date, the U.S. Attorney’s Office for the Middle District of Florida has diligently pursued fraud associated with compounding pharmacy claims, resulting in over $50 million in recoveries.
“Kickback arrangements skew the judgment of medical providers and threaten the integrity and viability of our healthcare programs,” said U.S. Attorney Chapa Lopez. “The TRICARE program has been particularly vulnerable to these schemes in recent years. We will use every remedy at our disposal, including the civil False Claims Act, to eradicate this kind of fraud from our district.”
The lawsuit is filed under the False Claims Act, which makes a person liable to the United States if he presents, or causes another to present, false or fraudulent claims for payments. The Anti-Kickback Statute prohibits anyone from offering or paying remuneration in order to induce or reward referrals for services paid for under federal healthcare systems.
The case is captioned United States v. Mihir Taneja, Case No. 8:21-cv-102-T-24AEP. The claims asserted by the government are allegations only, and there has been no determination of liability. The United States previously filed suit against Smith and Oldsmar Pharmacy arising out of the same conduct. That case is captioned U.S. ex rel. Silva, et al. v. Z Stat Medical, LLC, et al., No. 8:15-cv-00444-T-33TGW (M.D. Fla.).
The government’s complaint in this action illustrates the government’s emphasis on combating health care fraud. One of the most powerful tools in this effort is the False Claims Act. Tips from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services, at 800-HHS-TIPS (800-447-8477).
The case is being handled by Assistant U.S. Attorney Michael R. Kenneth of the U.S. Attorney’s Office for the Middle District of Florida, with assistance of the Department of Defense Office of Inspector General.
United States Attorney’s Office Files Suit Against San Joaquin County Pharmacy for Unlawfully Dispensing OpioidsRead the Press Release
SACRAMENTO, Calif. — In a civil complaint filed in the Eastern District of California, the United States alleges that Lawrence Howen and the pharmacy he owns, Nor-Cal Pharmacies Inc. doing business as Lockeford Drug, unlawfully dispensed controlled substances from 2016 through 2019, in violation of the Controlled Substances Act.
The complaint alleges that Howen failed to meet his obligations as the pharmacist of Lockeford Drug in dispensing dangerous opioids and other drugs. According to the complaint, Howen knowingly filled over 700 controlled substance prescriptions that were not issued for a legitimate medical purpose, and he filled prescriptions outside the ordinary course of pharmacy practice. This unlawful conduct resulted in the improper dispensing of over a hundred thousand of doses of controlled substances, primarily prescription opioids. Civil penalties and injunctive relief are sought to prevent Howen from committing further violations.
“As a pharmacist who filled prescriptions for dangerous controlled substances, Howen had an obligation to fill only those prescriptions that he ensured were legitimate,” said U.S. Attorney Scott. “Too many lives have been lost during the opioid crisis because those entrusted with responsibility turned a blind eye. This filing represents an important step in our efforts to hold pharmacists and others in the chain of opioid distribution accountable for misconduct.”
“Pharmacists are often the last line of defense to ensure controlled substances are dispensed lawfully and do not fall into the wrong hands. DEA will continue to hold those accountable who choose to ignore red flags and put the public at risk,” stated DEA Special Agent in Charge Daniel C. Comeaux.
This case is the product of an investigation by the Drug Enforcement Administration’s Sacramento Tactical Diversion Squad. Assistant U.S. Attorney Steven Tennyson is prosecuting the case.
United Kingdom National Charged with Bribery and Kickback Scheme Involving Iraqi Reconstruction ContractsRead the Press Release
NEWARK, N.J. – A United Kingdom national is charged with wire fraud and conspiracy to commit bribery for his role in a scheme involving the award of millions of dollars of U.S. Army Corps of Engineers (USACE) reconstruction contracts in Iraq, Acting U.S. Attorney Rachael A. Honig announced today.
The indictment unsealed today charges Shwan Al-Mulla, 60, the former owner of Iraqi Consultants & Construction Bureau (ICCB), with seven counts of honest services wire fraud and one count of conspiracy to commit bribery and defraud the U.S. government. Al-Mulla remains at large.
According to the indictment unsealed today:
In 2003, Al-Mulla founded ICCB. Between 2007 and 2009, Al-Mulla and his conspirators, including Ahmed Nouri and another ICCB employee, paid over $1 million in bribes to John Alfy Salama Markus, a USACE employee, in exchange for the awarding of millions of dollars in Iraqi reconstruction contracts to ICCB. Salama Markus was a USACE employee deployed to Contingency Operating Base Speicher in Tikrit, Iraq. Salama Markus was involved in the review and award process for lucrative Iraqi reconstruction contracts and the administration, oversight, and modification of those contracts after they were awarded. In exchange for over $1 million in bribes, Salama Markus provided Al-Mulla and his conspirators with confidential USACE information concerning bids, independent government estimates, and the selection process. Al-Mulla and Nouri used this information to submit winning bids for millions of dollars in contracts. They also submitted bids on behalf of multiple companies, with Salama Markus’ knowledge, for the same contracts.
For example, in March 2007, Salama Markus solicited a $350,000 bribe in exchange for helping ICCB obtain a $6.2 million contract to make certain infrastructure improvements at the Bayji Oil Refinery. On April 24, 2007, Salama Markus sent an email to Nouri telling Nouri the price to bid, on behalf of ICCB, for the contract, and on May 9, 2007, ICCB received the contract. On June 20, 2007, Al-Mulla received an email from Nouri asking to make a $200,000 partial bribe payment to Salama Markus and Salama Markus agreed. Al-Mulla subsequently instructed another ICCB employee to arrange for a $200,000 payment to be made to Salama Markus in Egypt. On July 17, 2007, Al-Mulla received an email from Nouri detailing the bribes owed to Salama Markus and the expected official actions promised by Salama Markus. The outstanding bribe payments listed in the email included the remaining $150,000 bribe payment in connection with the Bayji Oil Contract, a $100,000 bribe payment for USACE contracts concerning the building of schools; and a $550,000 payment to ensure that ICCB obtained four additional contracts.
In July 2007, ICCB received the additional four contracts, worth approximately $7 million dollars, in exchange for the promised $550,000 bribe payment to Salama Markus. In August 2007, Al-Mulla met Nouri, Salama Markus, and another ICCB employee in Amman, Jordan. Al-Mulla authorized the payment of $750,000 cash to Salama Markus. And, at ICCB’s office in Amman, an ICCB employee gave a bag containing $750,000 in cash to Salama Markus.
Salama Markus previously pleaded guilty to honest services wire fraud, money laundering and tax offenses and, on March 12, 2013, he was sentenced to 156 months in prison. On Oct. 1, 2018, Ahmed Nouri pleaded guilty to conspiracy to commit bribery and is awaiting sentencing.
The honest services wire fraud counts each carry a maximum potential penalty of 20 years in prison and a $250,000 fine. The conspiracy to commit bribery and defraud the U.S. government count carries a maximum potential penalty of five years in prison and a $250,000 fine.
Acting U.S. Attorney Honig credited special agents of the U.S. Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Jason J. Molina; the IRS-Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez; the Defense Criminal Investigative Service, under the direction of Special Agent in Charge Patrick J. Hegarty; and the U.S. Attorney’s Office, under the direction of Supervisory Special Agent Thomas Mahoney, with the investigation leading to the charges.
The government is represented by Acting Principal Assistant U.S. Attorney Rahul Agarwal and Assistant U.S. Attorney Elaine Lou of the Special Prosecutions Division in Newark.
The charges and allegations contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Ty Garbin Pleads Guilty to Conspiring to Kidnap Michigan Governor Gretchen WhitmerRead the Press Release
Member of Kidnapping Plot Admits Guilt, Promises to Cooperate with Government
GRAND RAPIDS, MICHIGAN — One of six men accused of conspiring to kidnap Michigan Governor Gretchen Whitmer pleaded guilty to that offense today in federal court, U.S. Attorney Andrew Birge announced today. Ty Gerard Garbin, of Hartland, Michigan, admitted his guilt in a change of plea hearing conducted by Chief United States District Court Judge Robert J. Jonker. The Court scheduled Garbin’s sentencing on July 8, 2021, at 3:00 pm. He remains in the custody of the United States Marshal pending sentencing.
Garbin pleaded guilty pursuant to an agreement with the U.S. Attorney’s Office for the Western District of Michigan. Garbin has agreed to fully cooperate with federal and state law enforcement in the investigation and prosecution of all criminal activity, including the conspiracy to kidnap the Governor. His obligation to assist law enforcement continues until all investigations and prosecutions are completed. The United States Attorney’s Office for the Western District of Michigan agreed not to seek additional criminal charges against him arising out of the conspiracy to kidnap the Governor. The entire plea agreement is publicly available on the Court’s PACER electronic docket system.
Garbin faces up to life in prison and there is no parole in the federal system. The District Court will determine the ultimate sentence to be imposed after evaluating the applicable federal Sentencing Guidelines and considering the statutory sentencing factors, including the nature and circumstances of the offense; the history and characteristics of the defendant; the seriousness of the offense; and the need to promote respect for the law, to provide just punishment, and protect the public from future crimes of the defendant.
Garbin is the first defendant in the case to plead guilty to the indictment handed down by a federal grand jury in Grand Rapids, Michigan on December 16, 2020. Trial is currently scheduled to begin on March 23, 2021.
The charge in the indictment against Garbin’s co-defendants is merely an accusation, and each remaining defendant is presumed innocent unless and until proven guilty in a court of law.
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Two Zuni men Sentenced for RobberyRead the Press Release
ALBUQUERQUE, N.M. – Brandon Jim, 35, of Zuni, New Mexico, was sentenced on Jan. 26 in federal court in Albuquerque to 11 years in prison followed by 3 years of supervised release for robbery and aiding and abetting in Indian Country. Co-defendant Timothy Boone, 27, also of Zuni, was sentenced on July 16, 2020, in Albuquerque to 10 years in prison followed by 3 years of supervised release for the same crime. Both men are members of the Zuni Pueblo.
Jim pleaded guilty to this offense on March 4, 2020, while Boone pleaded guilty on July 18, 2019. In their plea agreements, they admitted to using a gun and a knife to rob a minor, identified in court records as John Doe. By threat of violence, Jim and Boone took Doe’s belongings, including two cell phones, a fishing rod, a tackle box, a sweatshirt and .22 caliber ammunition. The crime was committed near Eustace Lake on the Zuni Pueblo.
The Gallup office of the FBI investigated this case with assistance from the Zuni Police Department. Assistant U.S. Attorney Elisa Dimas prosecuted the case.