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Thursday 22 October 2020
Two Men Convicted in Violent Robbery of Hinsdale Jewelry StoreRead the Press Release
CHICAGO — A federal jury today convicted two men on robbery and weapons offenses for stealing expensive watches and jewelry at gunpoint from a Hinsdale store.
TOBIAS DIGGS, 26, of Chicago, and JOSHUA MCCLELLAN, 31, of Oak Lawn, robbed Razny Jewelers, 37 S. Washington St. in the western suburb, on the morning of March 17, 2017. More than $200,000 in merchandise was stolen during the heist, including watches by luxury brands Frederique Constant, Patek Phillipe, and Tudor. The defendants later sold, attempted to sell, or disposed of some of the stolen items in the Chicago area and Atlanta, Ga.
After a six-day trial in federal court in Chicago, Diggs and McClellan were convicted of all counts against them, including conspiracy to commit robbery, robbery, transportation of stolen goods, and brandishing a firearm during a crime of violence. U.S. District Judge Gary S. Feinerman did not immediately set sentencing dates.
The conviction was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and James M. Gibbons, Special Agent-in-Charge of the Chicago office of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. The Hinsdale Police Department, Oak Lawn Police Department, and the FBI Chicago Field Office’s Cellular Analysis Survey Team (CAST) provided valuable assistance. Additional support was provided by the Felony Investigation Assistance Team (FIAT), a multi-jurisdictional law enforcement task force in the western suburbs. The government is represented by Assistant U.S. Attorneys Albert Berry III and Christopher V. Parente.
Two other individuals allegedly participated in the robbery. MARVON HAMBERLIN, 42, of Chicago, was indicted and is a fugitive. A warrant has been issued for his arrest. The fourth individual has not been identified.
According to evidence presented at trial, the defendants planned in advance to rob Razny Jewelers. On the day of the heist, McClellan drove the getaway car – a Lexus sport-utility vehicle – while Diggs and the others entered the store and pointed a gun at a female employee. After the unidentified robber tackled a store security guard, Diggs hit the female employee with the gun and dragged her by her hair to a back room, while he and the others gained accessed to the store’s safe and stole the jewelry.
The conspiracy and robbery counts each carry maximum sentences of 20 years in prison, while transportation of stolen goods is punishable by up to ten years. The firearm conviction carries a maximum sentence of life in prison, as well as a minimum term of imprisonment of seven years, which must be served consecutively to the sentences imposed for the conspiracy, robbery, and transportation of stolen goods convictions.
Two Men Convicted in Manhattan Federal Court of Conspiring to Commit Murder for HireRead the Press Release
Audrey Strauss, Acting United States Attorney for the Southern District of New York, announced that VANCE COLLINS, a/k/a “Big AK,” and RAMON RAMIREZ, a/k/a “Obendy,” were found guilty of hiring gang members to murder an individual believed to be having an affair with RAMIREZ’s wife. COLLINS was also convicted of possessing a firearm after having been convicted of a felony. COLLINS and RAMIREZ were convicted yesterday after a five-day trial before U.S. District Judge P. Kevin Castel.
Acting U.S. Attorney Audrey Strauss said: “Vance Collins and Ramon Ramirez tried to arrange for a murder. Now, in the first criminal trial in this District since the outbreak of the COVID-19 pandemic, the defendants stand convicted and will face punishment for their crimes.”
According to the allegations in the Indictment and evidence at trial:
In around 2017, RAMIREZ learned that his wife was having an affair with another man (the “Victim”). RAMIREZ enlisted COLLINS, a high-ranking gang leader, to hire someone to kill the Victim. COLLINS turned to a member of his gang, who in turn enlisted another gang member, and those two gang members took steps to locate and surveil the Victim, intending to shoot or stab the Victim to death. One night in October 2018, the two hitmen encountered the Victim at the Victim’s home; however, the presence of another person thwarted their plan. One of the hitmen was arrested shortly thereafter, and the Victim was not killed. During his arrest, COLLINS was found to be in possession of three firearms, including one that he and one of the hitmen had acquired to use in the plot to kill the Victim.
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Count One charged the defendants with conspiracy to commit murder for hire in violation of 18 U.S.C. § 1958, and Count Two charged the defendants with murder for hire in violation of 18 U.S.C. §§ 1958 and 2. Count Three charged defendant COLLINS with possessing a firearm after having been convicted of a felony. Each charge carries a maximum penalty of 10 years in prison. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.
The defendants are scheduled to be sentenced by Judge Castel on February 10, 2021.
Ms. Strauss praised the outstanding investigative work of the FBI Westchester County Safe Streets Task Force, which comprises agents and task force officers from the FBI, Bureau of Alcohol, Tobacco, Firearms and Explosives, United States Probation Office, New York State Police, New York City Police Department, Mount Vernon Police Department, Yonkers Police Department, Greenburgh Police Department, Peekskill Police Department, Westchester County Police Department, and the Westchester County District Attorney’s Office.
The case is being handled by the Office’s Violent and Organized Crime Unit. Assistant U.S. Attorneys Jamie Bagliebter, Adam Hobson, Frank Balsamello, Christopher Brumwell, and Celia Cohen are in charge of the prosecution.
Two Defendants Arrested at A Cheektowaga Hotel, Charged with Cocaine PossessionRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Archie Butler, 42, of Buffalo, NY, and Jamielah Huggins, 37, of Kenmore, NY, were arrested and charged by complaint with possession with intent to distribute cocaine. The charge carries a maximum penalty of 20 years in prison and a $1,000,000 fine.
Assistant U.S. Attorney Nicholas T. Cooper, who is handling the case, stated that according to the complaint, on October 16, 2020, law enforcement officers were conducting surveillance at the Aloft Hotel on Genesee Street in Cheektowaga, NY. Homeland Security Investigations received information regarding the possibility of a bulk narcotics transaction on that date involving defendant Butler, who is currently on post-release supervision with the New York State Department of Corrections and Community Supervision following a New York State drug-related felony conviction.
During surveillance, investigators observed Butler arrive at approximately 6:15 p.m. in a vehicle driven by defendant Huggins. Shortly thereafter, two Hispanic males exited the Aloft Hotel and approached Butler in the vehicle. The three men engaged in a brief conversation before Butler, Huggins, and the two Hispanic males all entered the hotel together. Butler was carrying a purple luggage bag. Approximately 15 minutes later, Butler and Huggins left the hotel, with Butler still carrying the purple bag. The two defendants were arrested by law enforcement officers at the scene.
Following their arrests, investigators searched the purple luggage bag and recovered five pressed powder cocaine bricks wrapped in cellophane and duct tape, weighing approximately 5.6 kilograms.
The defendants made an initial appearance before U.S. Magistrate Judge Michael J. Roemer, Butler was detained, while Huggins was released on conditions.
The complaint is the result of an investigation by Homeland Security Investigations, under the direction of Special Agent-in-Charge Kevin Kelly; the Drug Enforcement Administration, under the direction of Special Agent-in-Charge Ray Donovan, New York Field Division; the Erie County Sheriff’s Office, under the direction of Sheriff Timothy Howard; the Cheektowaga Police Department, under the direction of Chief Michael Sliwinski, and Customs and Border Protection, under the direction of Director of Field Operations Rose Brophy.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
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Twelve Individuals Charged with Scheme to Steal Checks and Defraud BanksRead the Press Release
NEWARK, N.J. – Twelve people have been charged for their participation in a scheme to steal and alter checks from the mail and engage in bank fraud, U.S. Attorney Craig Carpenito announced today.
Aaron Llody Northern, a/k/a “Bossdon Butta,” 28, of Reisterstown, Maryland; Corey Bond, a/k/a “Teddy Brown,” 27, of New York, New York; Tyrell Baker, 23, of the Bronx, New York; Andre Tyrone Wallace, 31, of the Bronx, New York; Michellian Thompson, 34, of the Bronx, New York; Achiel Morgan, a/k/a “Ace Skrap,” 22, of the Bronx, New York; Quinton Sessions, a/k/a “Q Doggy Widda Hoddie,” 27, of the Bronx, New York; Brian Adjavon, a/k/a “CarlosSlimm,” a/k/a “sasuforever,” 30, of the Bronx, New York; Dashawn Danforth, a/k/a “Shawn Moneyy Marley,” 31, of Staten Island, New York; Simone Cordero, 29, of the Bronx, New York; Stephanie Lee Sanchez, 25, of New York, New York; and Hans Pierre, a/k/a “hustlehans,” 32, of Brooklyn, New York; were each charged with one count of bank fraud conspiracy (Count One), one count of conspiracy to receive and possess stolen mail (Count Two); and one count of conspiracy to possess and receive interstate altered securities (Count Three).
Northern, Sessions, Adjavon, Danforth, and Pierre were also charged with one count of money laundering conspiracy (Count Four), and Northern and Cordero were additionally charged with one count of aggravated identity theft (Count Five).
Baker, Thompson, Morgan, Adjavon, Danforth, Sanchez, Cordero, and Wallace were arrested today and are scheduled to appear by videoconference before the U.S. Magistrate Judge James B. Clark III this afternoon. Northern was arrested this morning in Maryland and is scheduled to appear in the District of Maryland on Oct. 23, 2020. Bond, Sessions, and Pierre have not yet been arrested.
According to documents filed in this case and statements made in court:
In 2018 and 2019, the defendants and others conspired to steal checks from the mail, alter the payee and/or amount written on the stolen checks, possess and transport the stolen and altered checks outside of, or into, New Jersey, through interstate commerce, and deposit the checks into bank accounts to take money that did not belong to them. Some of the defendants then laundered the stolen money by concealing it through different financial accounts.
Surveillance footage shows certain defendants and others stealing mail from U.S. Postal Service collection boxes in Newark. After stealing checks from the mail, defendants and others, including Adjavon and Cordero, altered and deposited the checks into other people’s bank accounts. The stolen money was then transferred to another account or withdrawn as cash. The victims include the New Jersey branch of a non-profit network of public charter schools, which experienced fraudulent activity on its bank accounts after placing checks in the mail.
Count One carries a maximum sentence of 30 years in prison and a fine of $1 million. Counts Two and Three each carry a maximum sentence of five years in prison and a fine of $250,000, or twice the pecuniary gain to the defendant or loss to the victim, whichever is greater. Count Four carries a maximum sentence of 20 years in prison and a fine of $500,000, or twice the value of the property involved in the transaction, whichever is greater. Count Five carries a mandatory term of two years in prison, which must run consecutively to any other sentence imposed, along with a maximum fine of $250,000 or twice to pecuniary gain to the defendant or loss to the victim, whichever is greater.
U.S. Attorney Carpenito credited special agents of the U.S. Postal Inspection Service Newark Division, under the direction of Acting Inspector in Charge Raimundo Marrero; the U.S Postal Inspection Service New York Division, under the direction of Inspector in Charge Phil Bartlett; the U.S. Secret Service Long Island Resident Office, under the direction of Resident Agent in Charge Steven Choma; the U.S. Postal Inspection Service Washington Division, under the direction of Inspector in Charge Peter Rendina; the U.S. Department of Homeland Security, Homeland Security Investigations Newark Division, under the direction of Special Agent in Charge Jason J. Molina, the Co-Op City Department of Public Safety, under the direction of Chief Joseph R. Riley; and the New York City Police Department, under the direction of Commissioner Dermot Shea; with the investigation and arrests.
The government is represented by Assistant U.S. Attorney Jamie L. Hoxie of the Criminal Division in Newark.
The charges and allegations contained in the complaint against the defendants are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
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Defense counsel:
Tyrell Baker: Michael V. Calabro Esq., Newark
Andre Tyrone Wallace: Geoffrey St. Andrew Stewart Esq., New York
Michellian Thompson: James A. Plaisted Esq., Hackensack, New Jersey
Achiel Morgan: Blair R. Zwillman Esq., Morristown, New Jersey
Brian Adjavon: Gary Mizzone Esq., Little Falls, New Jersey
Dashawn Danforth: Adalgiza A. Nunez Esq., Newark
Simone Cordero: Jacqueline E. Cistaro Esq., Red Bank, New Jersey
Stephanie Lee Sanchez: Joseph Rubino Esq., Union, New Jersey
Trio Named in Indictment Alleging International Conspiracy to Defraud Elderly by Posing as Federal Agents Threatening ArrestRead the Press Release
RIVERSIDE, California – Two Riverside County men were arrested today on an indictment alleging they participated in an international conspiracy that deceived elderly victims into sending more than $500,000 in cash by pretending to be federal agents threatening them with arrest on bogus warrants.
The federal grand jury indictment unsealed today charges a total of three Lake Elsinore residents with conspiracy to commit mail fraud and wire fraud:
- Anuj Mahendrabhai Patel, 30, a.k.a. “Mike” and “Indio”;
- Elmer Miranda Barrios, 35, whose aliases include “Welbin Raul Mejia” and “Joe Rodriguez”; and
- William Margarito Barrios, 36, Elmer Barrios’s cousin, who faces an additional charge of being an illegal alien who re-entered the United States following deportation.
Elmer and William Barrios were taken into federal custody today and are expected to be arraigned this afternoon in United States District Court in Riverside. Patel’s arraignment is expected in the coming weeks.
According to court documents, from April 2019 until March 2020, other members of the conspiracy, some of whom are believed to be in India, telephoned victims and pretended to be government employees or law enforcement officers. Using a number of false pretenses – including phony badge numbers and using spoofed government telephone numbers – the co-conspirators convinced the victims, most of whom were over the age of 55, that their identities or assets were in trouble.
For example, some victims were told that their Social Security numbers had been linked to crimes and that there were warrants issued by courts authorizing the victims’ arrests. The co-conspirators further told the victims that in order to clear the warrants, they should withdraw their savings and send cash by mail to other members of the scheme.
The victims were ordered to send the parcels through shipping companies that allowed parcel recipients to pick up parcel so long as the recipients had identification matching the names listed on the parcel as the addressees. The addresses the defendants gave primarily were at locations in Riverside County, but also in Los Angeles and San Diego counties.
Patel allegedly used tracking numbers to monitor the victims’ parcels, and communicated with couriers – Elmer and William Barrios – who used fraudulent identification documents matching the names listed on the parcels as addresses.
For example, in February 2020, Patel allegedly received a UPS parcel containing $10,000 from an 82-year-old victim that was addressed to “Victor Efrain DePaz” in Hemet.
The total loss alleged in this case is approximately $541,420 and the defendants allegedly conspired to receive more than 50 parcels sent by the scheme’s victims.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
If convicted, Patel and Elmer Barrios would face a statutory maximum sentence of 20 years in federal prison, while William Barrios’s maximum penalty would be 22 years in federal prison.
This matter was investigated by Homeland Security Investigations; the Social Security Administration; the United States Department of Treasury Inspector General for Tax Administration; the Murrieta Police Department; the San Bernardino County Sheriff’s Department; the Los Angeles County Sheriff’s Department; the Huntington Beach Police Department; the Fullerton Police Department; the Stanislaus County (California) Sheriff’s Department; the Seattle Police Department; the Brownsville (Texas) Police Department; the St. James Parish (Louisiana) Sheriff’s Office; the Cook County (Illinois) Sheriff’s Office; the Addison (Illinois) Police Department; the Columbus (Ohio) Division of Police; the Northwest Lancaster County (Pennsylvania) Regional Police Department; the Edison Township (New Jersey) Police Department; and the St. Petersburg (Florida) Police Department.
This case is being prosecuted Assistant United States Attorney Peter Dahlquist of the Riverside Branch Office.
The U.S. Attorney’s Office in Los Angeles is one of six offices participating in the Transnational Elder Fraud Strike Force, a joint law enforcement effort that brings together the resources and expertise of federal law enforcement and non-governmental organizations to combat international fraud schemes that disproportionately affect American seniors.
Texan pleads guilty in CARES Act unemployment fraud schemeRead the Press Release
CORPUS CHRISTI, Texas - A 28-year-old Corpus Christi man has admitted to devising a scheme to fraudulently misappropriate $278,433 in unemployment benefits meant for those suffering financial hardship due to the COVID-19 pandemic, announced U.S. Attorney Ryan K. Patrick.
William Cleveland Peck admitted to misappropriating personally identifiable information, such as Social Security numbers and dates of birth, related to various individuals. Peck then used that information to file multiple false and fraudulent claims for Pandemic Unemployment Assistance (PUA) and general unemployment benefits between May and July 2020.
As part of his guilty plea, Peck admitted to committing mail fraud by using a misappropriated identity to file a false and fraudulent claim with the Texas Workforce Commission (TWC), causing them to mail a debit card to a P.O. Box Peck utilized. Peck then used the fraudulently-obtained debit card to withdraw cash and make purchases. The individual under whose identity Peck filed the false claim was not a resident of Texas, not eligible for benefits through TWC and did not authorize Peck to file such a claim.
PUA benefits were made available through the Coronavirus Aid, Relief and Economic Security (CARES) Act - a federal law enacted March 29 which provides emergency financial assistance to millions of Americans who are suffering the economic effects resulting from the COVID-19 pandemic.
U.S. District Judge David S. Morales accepted the plea today and set sentencing for Jan. 25, 2021. At that time, Peck faces up to 20 years in federal prison and a possible $250,000 fine.
He was permitted to remain on bond pending that hearing.
The Department of Labor - Office of the Inspector General, U.S. Postal Inspection Service and TWC conducted the investigation. Assistant U.S. Attorneys Andrew Swartz and Asha Natarajan are prosecuting the case.
Tampa Felon Sentenced to More Than Six Years for Possessing A FirearmRead the Press Release
Tampa, Florida – U.S. District Judge William F. Jung has sentenced Zachary A. Jones (22, Tampa) to six years and five months in federal prison for possessing a firearm and ammunition as a convicted felon. The court also ordered Jones to forfeit the firearm and ammunition used in the offense.
Jones had pleaded guilty on August 11, 2020.
According to court documents, on February 18, 2019, officers from the Tampa Police Department were looking for Jones, who had active warrants for his arrest. As officers approached Jones, he fled. While running from the officers, Jones discarded a loaded firearm. Officers later arrested Jones and recovered the firearm.
Jones has multiple prior convictions for narcotics-related felonies and is therefore prohibited from possessing a firearm or ammunition under federal law. At the time of this offense, Jones was on community control in the state of Florida.
This case was investigated by the Federal Bureau of Investigation and the Tampa Police Department. It was prosecuted by Assistant United States Attorney Callan Albritton.
This is another case prosecuted as part of the Department of Justice’s “Project Safe Neighborhoods” Program (PSN), which is a nationwide crime reduction strategy aimed at decreasing violent crime in communities. It involves a comprehensive approach to public safety — one that includes investigating and prosecuting crimes, along with prevention and reentry efforts. In the Middle District of Florida, U.S. Attorney Maria Chapa Lopez coordinates PSN efforts in cooperation with various federal, state, and local law enforcement officials.
Suboxone Manufacturer Indivior's Former Chief Executive Officer Sentenced to Jail Time in Connection with Drug Safety ClaimsRead the Press Release
ABINGDON, VIRGINIA – Shaun Thaxter, the former chief executive officer of Indivior PLC, was sentenced today in U.S. District Court in Abingdon to 6 months in federal prison. He was also ordered to pay a fine of $100,000 and forfeit $500,000. Thaxter pleaded guilty to a one-count misdemeanor information on June 30, 2020 for his role in causing the introduction into interstate commerce of misbranded shipments of the opioid drug Suboxone Film, a violation of the Federal Food, Drug, and Cosmetic Act. Acting United States Attorney Daniel P. Bubar announced the sentence today.
Thaxter served as Indivior’s top executive from 2009 until shortly before his guilty plea. This includes the time period prior to December 2014 when Indivior was known as Reckitt Benckiser Pharmaceuticals. When Indivior was known as Reckitt Benckiser Pharmaceuticals, it was a subsidiary of British conglomerate Reckitt Benckiser Group (RB Group). RB Group paid $1.4 billion in 2019 to resolve its liability to the United States related to the marketing of Suboxone. On July 24, 2020, an Indivior subsidiary called Indivior Solutions pleaded guilty to a one-count felony information for false statements related to health care matters, and together with Indivior, agreed to pay an additional $600 million to resolve liability to the United States related to the marketing of Suboxone. On August 26, 2020, Indivior’s former medical director, Timothy Baxter, pleaded guilty to a one-count misdemeanor information for a violation of the Federal Food, Drug, and Cosmetic Act related to the marketing of Suboxone. Indivior Solutions and Baxter have not yet been sentenced.
Suboxone Film is a drug product approved for use by recovering opioid addicts to avoid or reduce withdrawal symptoms while they undergo treatment. Suboxone’s active ingredient, buprenorphine, is a powerful and addictive opioid. Thaxter was charged in connection with Indivior’s misrepresentations regarding the safety of Suboxone Film.
“While Thaxter served for years as Indivior’s chief executive, he was in a position to ensure that doctors, patients, and insurers were dealt with honestly,” Acting United States Attorney Bubar said today. “Instead, Thaxter failed to prevent efforts to build profits through misleading safety claims, which led to millions of dollars in ill-gotten gains for Indivior. As the Court recognized today, this sentence should serve as a deterrence to other pharmaceutical executives. Today’s sentencing is also the product of years of work and could not have happened without the close federal and state law enforcement partnerships, for which we are grateful.”
“Families and communities across the Commonwealth continue to feel the devastating effects of the opioid epidemic,” said Virginia Attorney General Mark Herring. “Opioid manufacturers and their executive leadership must be held accountable for taking advantage of this country’s opioid crisis and putting profits over people. I want to thank my Medicaid Fraud Control Unit for their terrific work on this case as well as our local, state, and federal partners for their continued partnership on these cases.”
“Misrepresentations made about the drug, while Thaxter ran the company, misled MassHealth about the potential risk of accidental opioid exposure. It is inexcusable to willfully disregard requirements that treatment medications be prescribed carefully in order to protect patient health and safety,” said Elton Malone, Assistant Inspector General for Investigations with the Office of Inspector General of the U.S. Department of Health and Human Services. “With our law enforcement partners, we will continue investigating and bringing to justice those placing profits over patients in government healthcare programs.”
“Opioid addiction is a significant public health crisis and addressing opioid abuse continues to be one of FDA’s top priorities. Misleading information about relative product benefits undermines efforts to provide affordable treatment to those suffering from opioid addiction,” said Judy McMeekin, Pharm.D., Associate Commissioner for Regulatory Affairs, U.S. Food and Drug Administration. “We will continue to investigate and bring to justice those whose schemes jeopardize public health and put Americans at risk.”
“The U.S. Postal Service spends billions of dollars per year in workers compensation and health care-related costs, most of which are legitimate,” said Kenneth Cleevely, Special Agent in Charge of the Eastern Field Office for the U.S. Postal Service Office of Inspector General. “However, when medical providers or companies choose to flout the rules and profit illegally, special agents with the USPS OIG will work with our law enforcement partners to hold them responsible. To report fraud or other criminal activity involving the Postal Service, contact USPS OIG special agents at www.uspsoig.gov or 888-USPS-OIG.”
According to court documents, Thaxter had authority over Indivior’s marketing and sales of Suboxone Film which, along with other Suboxone products, generated nearly all the company’s revenue. In 2012, Thaxter oversaw and encouraged Indivior’s efforts to secure formulary coverage for Suboxone Film from the Massachusetts Medicaid agency called MassHealth. Thaxter asked Indivior employees under his direction to devise a strategy to win preferred drug status for Suboxone Film and counteract a non-opioid competitor MassHealth was considering for opioid-addiction treatment. Certain Indivior employees subsequently shared false and misleading safety information with MassHealth officials about Suboxone Film’s risk of accidental pediatric exposure. Two months after receiving that false and misleading information, MassHealth announced it would provide access to Suboxone Film for Medicaid patients with children under the age of six.
The criminal cases against Thaxter, Indivior, and Baxter are being prosecuted by attorneys from the U.S. Attorney’s Office for the Western District of Virginia and the Department of Justice’s Civil Division, including Albert P. Mayer, Randy Ramseyer, Kristin L. Gray, Joseph S. Hall, Janine M. Myatt, Garth W. Huston, Carol Wallack, Charles J. Biro, and Matthew J. Lash. The criminal investigation of Thaxter was handled by the Virginia Medicaid Fraud Control Unit; FDA’s Office of Criminal Investigations; United States Postal Service - Office of Inspector General; and U.S. Department of Health and Human Services - Office of Inspector General.
St. Croix Man Sentenced to Federal Prison for Possession of Child PornographyRead the Press Release
St. Thomas, USVI – The United States Attorney Gretchen C.F. Shappert announced today that on October 21, 2020, Judge Robert Molloy sentenced Collin Gomes, 27, of St. Croix, to 78 months in prison for possession of child pornography and five years of supervised release. Gomes was also ordered to pay special assessments in the amounts of $100 and $5,000, respectively. The Court also ordered $3,000 restitution to each of the three victims.
According to court documents, on or about August 16, 2018, September 6, 2018 and October 22, 2018, a Grand Prairie, Texas police detective was conducting an online investigation on the BitTorrent network for offenders sharing child pornography. BitTorrent is a communication system for peer-to-peer file sharing that enables users to distribute data and electronic files over the Internet in a decentralized manner. Files are shared on the BitTorrent network via use of “torrents,” which provide addresses identifying computers that can send portions of a requested file. With the assistance of a torrent file, the user can download small portions of the original file.
As a result of information collected by Grand Prairie, Texas law enforcement, officers initiated an investigation for a device on the IP address used by the defendant, because it was associated with a torrent with a particular infohash (an SHA-1 hash value of the data describing the files within the torrent). The torrent files referenced a number of files, at least one of which was identified as child pornography. On each of the dates referenced above, a download of files was successfully completed from the device that the defendant’s IP address was making available. Officers confirmed that each download contained child pornography.
On December 14, 2018, HSI executed a search warrant on the defendant’s residence on St. Croix. Agents explained to the defendant what they were searching for and advised him of his rights. The defendant waived his rights and agreed to speak to the agents. They asked if he viewed, downloaded and made available for download any files containing images or videos depicting child pornography and the defendant said “yes.” The defendant also told the agents he had an HP computer on which he had child pornography and that he had been downloading child pornography since 2011 and collected thousands of
images and videos. He stated that there was approximately one and a half Terabytes of material. HIS agents located thousands of child pornography images and videos on the defendant’s computer and external hard drives.This case was investigated by Homeland Security Investigations and was prosecuted by Assistant United States Attorney Rhonda Williams-Henry.
St. Charles corporate executive pleads guilty to fraudulently using company’s credit cardRead the Press Release
ST. LOUIS, MO – United States District Judge E. Richard Webber accepted a plea today from Tara Sabatini. The 45-year-old St. Charles, Missouri resident pleaded guilty to one count of wire fraud.
According to the plea agreement and Indictment, Sabatini was employed as the “Senior Director of Sales” by a company located in St. Louis, Missouri that sold wholesale amounts of food to various commercial customers, typically grocery store chains. The company provided Ms. Sabatini with a company-funded corporate credit card, and authorized her to use the credit card for official business, including work travel and some client expenses.
During 2017-18, Sabatini used her corporate credit card to fund personal expenses, including but not limited to purchasing luxury ticket packages from a Major League Baseball team located in New York. She frequently engaged in electronic communications with New York employees of the team for ticket purchase and delivery purposes. After receiving these tickets, Sabatini attended some of the baseball games and also gave some of the tickets to her friends and family. Sabatini further sold some of the baseball tickets through an Internet service and spent the proceeds of the ticket sales on her personal expenses.
The charge of wire fraud carries a maximum penalty of no more than 20 years of imprisonment and a fine of no more than $250,000. In determining the actual sentence, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
Judge Webber has set sentencing for January 21, 2021 at 10:00 a.m.
The Federal Bureau of Investigation investigated the case.
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South Jersey Member of Philadelphia Crime Family Sentenced to 15 Years in Prison for Selling Illegal DrugsRead the Press Release
CAMDEN, N.J. – A Cape May, New Jersey, man was sentenced today to 180 months in prison for distributing approximately 300 grams of crystal methamphetamine and thousands of pills containing heroin and/or fentanyl, U.S. Attorney Craig Carpenito announced.
Joseph Servidio, a/k/a “Joey Electric,” 60, of Marmora, New Jersey, previously pleaded guilty before U.S. District Judge Robert Kugler to an information charging him with one count of conspiracy to distribute controlled substances, including 50 grams or more of crystal methamphetamine. Judge Kugler imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
Law enforcement sources have identified Servidio as a member of La Cosa Nostra (LCN), the Mafia. Servidio distributed pills that contained heroin and/or fentanyl along with conspirator Carl Chianese. The pills they distributed were stamped with markings that made them look similar to prescription opioid pills (Oxycodone or Percocet). Servidio and Chianese were also involved in the distribution of multiple-ounce quantities of crystal methamphetamine. Servidio and Chianese sold the pills and crystal methamphetamine on multiple occasions to an FBI undercover agent in exchange for cash payments. In total, Servidio was responsible for the distribution of over 200 grams of fentanyl and heroin and approximately 300 grams of crystal methamphetamine.
Chianese, 80, was sentenced by Judge Kugler in March 2020 to 10 years in prison and ordered to forfeit the firearm and United States currency, as part of the sentence imposed. Salvatore Piccolo, 68, another member of the Philadelphia LCN who sold crystal methamphetamine to the FBI undercover agent, was sentenced by Judge Kugler in November 2019 to 150 months in prison.
In addition to the prison term, Judge Kugler sentenced Servidio to five years of supervised release.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch, Jr., Newark Field Office, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Patrick C. Askin of the U.S. Attorney’s Office’s Camden Office.
South Carolina man admits to “crystal” meth and firearms chargesRead the Press Release
WHEELING, WEST VIRGINIA – Todd Michael Hensley, of Anderson, South Carolina, has admitted to drug and firearms charges, U.S. Attorney Bill Powell announced.
Hensley, age 48, pled guilty to one count of “Possession with Intent to Distribute Methamphetamine” and one count of “Possession of a Firearm in Furtherance of a Drug Trafficking Crime.”
On January 23, 2020, officers conducted a traffic stop of Hensley’s vehicle in Marshall County and found him to be in possession of approximately 2.73 pounds of “crystal” methamphetamine, also known as “ice,” a loaded 9mm Glock pistol, four loaded 10-round Glock firearm magazines, a loaded 15-round Glock firearm magazine, and three loaded 31-round Glock firearm magazines. Following the traffic stop, a search warrant was executed at Hensley’s home in Anderson, South Carolina, where officers seized an additional 14 firearms, including three AK47s, approximately 300 rounds of ammunition, 50 grams of “ice,” and $9,000 in cash.
Hensley faces up to 20 years of incarceration and a fine of up to $1,000,000 for the drug charge. He faces a mandatory five years of incarceration for the firearm charge. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Shawn M. Adkins is prosecuting the case on behalf of the government. The Drug Enforcement Administration and the Marshall County Drug & Violent Crimes Task Force, a HIDTA-funded initiative, investigated. The Anderson County, South Carolina Sheriff’s Department assisted.
U.S. Magistrate Judge James P. Mazzone presided.
South Carolina Man Admits Running $900,000 Foreign Currency Ponzi SchemeRead the Press Release
NEWARK, N.J. – A South Carolina man today admitted defrauding at least 20 individuals by soliciting investments in what he claimed were highly successful, algorithm-based trading pools in foreign currency derivatives (“forex”) and other financial instruments, and then using the bulk of the money for personal expenditures and to pay off other victims, Attorney for the United States Rachael Honig announced.
Thomas Lanzana, 51, of Pawleys Island, South Carolina, and formerly of New Jersey, pleaded guilty by videoconference before U.S. District Judge John Michael Vazquez Count 1 of the indictment returned against him in August 2019, charging him with wire fraud.
According to the documents filed in this case and statements made in court:
Lanzana fraudulently solicited approximately $900,000 from at least 20 customers to invest in forex pools beginning as early as 2013. Lanzana misrepresented to prospective customers that he was a successful forex trader when, in fact, he was not. To keep his customers’ trust, Lanzana, among other things, (1) sent false account statements to his customers, (2) posted false monthly account statements to his companies’ websites showing balances and trading activity for forex trading accounts that did not exist, and (3) generated and sent false tax documents to customers reporting earnings that did not exist. Lanzana misappropriated approximately $350,000 in customer funds, using some to repay earlier investors in the manner of a Ponzi scheme, and to pay for his personal expenses, including purchases on Amazon.com, payments to a luxury car dealer and a jewelry retailer, and golf expenses.
The count of wire fraud to which Lanzana pleaded guilty carries a maximum potential penalty of 20 years in prison and a fine of $250,000, or twice the pecuniary gain to the defendant or loss to the victims. Sentencing is scheduled for Feb. 23, 2021.
Attorney for the United States Honig credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr., and special agents of IRS-Criminal Investigation, under the direction of Michael Montanez, with the investigation leading to today’s guilty plea. He also thanked the U.S. Commodity Futures Trading Commission’s Division of Enforcement for its role in the investigation.
The government is represented by Assistant U.S. Attorney Anthony P. Torntore, of the U.S. Attorney’s Office’s Cybercrime Unit.
Six Members of Salinas-Based “Murder Squad” Indicted on Federal Racketeering ChargesRead the Press Release
SAN FRANCISCO – A federal grand jury has indicted six Salinas-based street gang members, charging them with racketeering conspiracy, use of a firearm causing murder, and related crimes, announced United States Attorney David L. Anderson, Homeland Security Investigations (HSI) Special Agent in Charge Tatum King, and Federal Bureau of Investigation (FBI) Special Agent in Charge John F. Bennett. The charges were announced in a press conference attended by U.S. Attorney Anderson and Special Agent in Charge King, as well as Monterey County District Attorney Jeannine Pacioni and Salinas Police Department (SPD) Chief Adele Fresé.
The defendants are Siaki Tavale, 24, Andrew Alvarado, 29, John Magat, 33, Anthony Valdez, 23, Mark Anthony Garcia, 29, and Anelu Tavale, 24. According to the Second Superseding Indictment filed October 15, 2020, and unsealed today, the defendants were members of a violent hit crew also referred to as the “murder squad.” The indictment describes how the murder squad orchestrated seven shootings, killing eight people and injuring several others. According to the indictment, seven of the eight homicide victims had no known gang affiliation.
“The indictment alleges a pattern of horrific violence,” said U.S. Attorney Anderson. “This violence destroys lives. This violence holds our community hostage. In announcing today’s charges, we reaffirm the importance of professional law enforcement. We need professional law enforcement to protect the community where we live and work and raise our families.”
“The family and friends of the men murdered by this heinous criminal enterprise have suffered profound loss. The inability for these men to live out their lives is extremely disturbing to a law abiding community, all of whom have a fundamental right to be safe in their homes,” said Special Agent in Charge King. “Working together in a collaborative effort with the U.S. Attorney, Northern District, the Salinas Police Department, the FBI, and the Monterey County District Attorney’s Office ensured that these criminals are afforded the most expeditious justice and will help protect the community from their wrath of terror.”
“Over the past three years, the FBI San Francisco Division has worked to link this murder squad with the Nuestra Familia and Norteno street gangs,” said Special Agent in Charge Bennett. “I would like to recognize the work of the members of the FBI throughout this investigation. This case is another example of how strong collaboration between federal, state, and local law enforcement is so effective in keeping our communities safe."
“Violent crimes committed by gang members continue to plague our community,” said DA Pacioni. “Awareness that innocent members of our community may be targeted affects the quality of all of our lives. That is why our office works hand-in-hand with the esteemed members of our law enforcement community to investigate such cases aggressively and bring justice to victims of such crimes.”
The indictment explains that a violent group of Norteno street gang members and others coordinated and executed missions to hunt and kill rival Sureno street gang members – or those the group perceived to be Surenos – in the neighborhoods of Salinas, Calif. The indictment describes murder squad’s use of multi-vehicle caravans that often included one vehicle with designated shooters and at least one spotter or security vehicle to help spot victims and avoid law enforcement detection. The indictment describes that the murder squad identified victims by characteristics they associated with rival Surenos – for example, Hispanic males, persons with shaved heads, and/or persons wearing blue. Once a victim was targeted, the shooters would allegedly fire until their firearms’ magazines were emptied. The indictment alleges that some shooters “hit up” their victims – or, confirmed their gang status – before shooting them, but that members of the murder squad did not always do this, and did not always wait for an answer, before shooting. The indictment alleges that this practice led to the shooting and killing of victims who were not, in fact, gang members. The indictment further alleges that the more “bodies” accumulated by a murder squad member, the higher status conferred on that member.
The indictment specifically provides descriptions of seven hunts in Salinas that culminated in injury and death between January 2017 and November 2018:
- On January 12, 2017, Siaki Tavale, Alvarado, Garcia, and others went hunting for rival gang members to kill. Their hunt led them to Sunrise Street and to a group of Hispanic men outside a house party. The shooters opened fire at the group. Four victims were shot, two were killed. There was no evidence the victims were actually gang members. After the shooting, the shooters led police officers on a high speed chase, crashed and abandoned their vehicle, and fled on foot.
- On February 11, 2017, Siaki Tavale, Alvarado, and others again went hunting in Salinas. This time, the defendants encountered a small group of Hispanic men outside the Hebbron Heights Community Center. The shooters fired at least 18 shots at the men, striking one victim in the head and killing him. The shooters were driving in a stolen SUV that had been doused in gasoline earlier that day, as a precaution in case it needed to be set on fire.
- The next day, on February 12, 2017, Siaki Tavale and Alvarado were joined by Anelu Tavale and others as they again hunted for rival Sureno gang members to kill. The group was driving in the same stolen SUV as the day before when they encountered two Hispanic men in another vehicle. The defendants perceived the men in the other vehicle to be rival Sureno gang members, and followed the vehicle to a residence on Orchard Avenue. After the vehicle pulled into the driveway, the shooters opened fire. The shooters fired at least 20 shots at the two victims. The victims survived, but suffered gunshot wounds to the neck, torso, and upper back.
- On March 25, 2017, Alvarado, Magat, Garcia, and others again went hunting for rival gang members to kill. This hunt was organized to retaliate for the recent killing of a fellow Norteno gang member. While driving on Dennis Avenue, the hunters happened upon two Hispanic men in the driveway of a residence. The shooters fired at least 32 shots at these men, killing them. One victim was killed in the driveway, while the other was chased to the backyard of the residence. There was no evidence either of the victims was actually a gang member.
- On May 13, 2017, Alvarado, Magat, and others again went hunting for rival gang members to kill. When they reached Paloma Avenue in Salinas, they spotted a young Hispanic man standing on the front porch of a residence. The shooters fired at least 15 shots at the victim, hitting him in the head and killing him. There was no evidence the victim was a gang member.
- On June 11, 2018, Magat, Valdez, Anelu Tavale, and others again went hunting for rival gang members to kill. The group spotted a man walking down Center Street, fired at least 19 shots, and killed him. As before, there was no evidence the victim was a member of a rival gang.
- On November 3, 2018, Valdez, Anelu Tavale, and others again went hunting for rival Sureno gang members to kill. This time, the purpose of the hunt was to commemorate the birthday of a deceased gang member. The shooters spotted a man walking on North Hebbron Avenue, and fired at least 35 shots at him. The victim was shot in the head and killed. Again, there was no evidence that this victim was actually a gang member.
In sum, the defendants are charged with the following crimes and, if convicted of all charged offenses, face the below-listed maximum penalties:
Defendant
Charges
Maximum Statutory Penalty
Siaki Tavale aka “Shocky” aka “Gunner”
18 U.S.C. § 1962(d) – Racketeering Conspiracy
18 U.S.C. § 1959(a)(5) – Conspiracy to Murder in Aid of Racketeering
18 U.S.C. §§ 924(j)(1) and 2 – Use of a Firearm Causing Murder of Victim-1
18 U.S.C. §§ 924(j)(1) and 2 – Use of a Firearm Causing Murder of Victim-2
18 U.S.C. §§ 924(c) and 2 – Possession/Use of a Firearm in Furtherance of and During and in Relation to a Crime of Violence re: Attempted Murders of Victim-3 and Victim-4
18 U.S.C. §§ 924(j)(1) and 2 – Use of a Firearm Causing Murder of Victim-5
18 U.S.C. §§ 924(c) and 2 – Possession/Use of a Firearm in Furtherance of and During and in Relation to Crime of Violence re: Attempted Murder of Victim-6
18 U.S.C. §§ 924(c) and 2 – Possession/Use of a Firearm in Furtherance of and During and in Relation to Crime of Violence re: Attempted Murders of Victim-7 and Victim-8
Death or life imprisonment
Andrew Alvarado aka “Oso” aka “Banger”
18 U.S.C. § 1962(d) – Racketeering Conspiracy
18 U.S.C. § 1959(a)(5) – Conspiracy to Murder in Aid of Racketeering
18 U.S.C. §§ 924(j)(1) and 2 – Use of a Firearm Causing Murder of Victim-1
18 U.S.C. §§ 924(j)(1) and 2 – Use of a Firearm Causing Murder of Victim-2
18 U.S.C. §§ 924(c) and 2 – Possession/Use of a Firearm in Furtherance of and During and in Relation to Crime of Violence re: Attempted Murders of Victim-3 and Victim-4
18 U.S.C. §§ 924(j)(1) and 2 – Use of a Firearm Causing Murder of Victim-5
18 U.S.C. §§ 924(c) and 2 – Possession/Use of a Firearm in Furtherance of and During and in Relation to Crime of Violence re: Attempted Murder of Victim 6
18 U.S.C. §§ 924(c) and 2 – Possession/Use of a Firearm in Furtherance of and During and in Relation to Crime of Violence re: Attempted Murders of Victim-7 and Victim-8
18 U.S.C. §§ 924(j)(1) and 2 – Use of a Firearm Causing Murder of Victim-9
18 U.S.C. §§ 924(j)(1) and 2 – Use of a Firearm Causing Murder of Victim-10
18 U.S.C. §§ 924(j)(1) and 2 – Use of a Firearm Causing Murder of Victim-11
Death or life imprisonment
John Magat aka “Romeo”
18 U.S.C. § 1962(d) – Racketeering Conspiracy
18 U.S.C. § 1959(a)(5) – Conspiracy to Murder in Aid of Racketeering
18 U.S.C. §§ 924(j)(1) and 2 – Use of a Firearm Causing Murder of Victim-9
18 U.S.C. §§ 924(j)(1) and 2 – Use of a Firearm Causing Murder of Victim-10
18 U.S.C. §§ 924(j)(1) and 2 – Use of a Firearm Causing Murder of Victim-11
Death or life imprisonment
Anthony Valdez aka “Hitter” aka “Tony Boronda”
18 U.S.C. § 1962(d) – Racketeering Conspiracy
18 U.S.C. § 1959(a)(5) – Conspiracy to Murder in Aid of Racketeering
18 U.S.C. §§ 1959(a)(1) and 2 – Murder in Aid of Racketeering of Victim-13
18 U.S.C. §§ 924(c) and 2 – Possession/Use of a Firearm in Furtherance of and During and in Relation to Crime of Violence
18 U.S.C. §§ 924(j)(1) and 2 – Use of a Firearm Causing Murder
Death or life imprisonment
Mark Anthony Garcia aka “Tony from Santa Rita”
18 U.S.C. § 1962(d) – Racketeering Conspiracy
18 U.S.C. § 1959(a)(5) – Conspiracy to Murder in Aid of Racketeering
Life imprisonment
Anelu Tavale aka “Angel”
18 U.S.C. § 1962(d) – Racketeering Conspiracy
18 U.S.C. § 1959(a)(5) – Conspiracy to Murder in Aid of Racketeering
18 U.S.C. §§ 924(c) and 2 – Possession/Use of a Firearm in Furtherance of and During and in Relation to Crime of Violence re: Attempted Murders of Victim-7 and Victim-8
Life imprisonment
However, any sentence following conviction would be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
An indictment contains allegations only and all defendants are presumed innocent until proven guilty beyond a reasonable doubt.
All the defendants are in custody. Mark Anthony Garcia and Anelu Tavale are scheduled for initial appearances on October 22, 2020, at 10:30 a.m., before the Honorable Nathanael Cousins, United States Magistrate Judge.
The case is being prosecuted by the Organized Crime Strike Force of the United States Attorney’s Office for the Northern District of California. The investigation of this case was conducted by the Salinas Police Department, together with the Homeland Security Investigations and the Federal Bureau of Investigation, with assistance from the Monterey County District Attorney’s Office. The investigation was conducted and funded by the Organized Crime Drug Enforcement Task Force (OCDETF), a multi-agency task force that coordinates long-term narcotics trafficking investigations.
Seattle Software Developer pleads guilty to wire fraud for covid-relief fraud schemeRead the Press Release
WASHINGTON – A Seattle man pleaded guilty today to one count of wire fraud for carrying out a scheme to defraud several COVID-19 relief programs.
Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division, U.S. Attorney Brian T. Moran of the Western District of Washington, Special Agent in Charge Weston King of the U.S. Small Business Administration Office of Inspector General’s (SBA-OIG) Western Region, Treasury Inspector General for Tax Administration (TIGTA) J. Russell George, and Special Agent in Charge Raymond Duda of the FBI’s Seattle Field Office made the announcement.
Baoke Zhang, 35, of Issaquah, Washington, pleaded guilty to one count of wire fraud before U.S. Magistrate Judge Brian A. Tsuchida of the Western District of Washington.
As part of his guilty plea, Zhang admitted that he carried out a scheme to defraud several different government and private COVID-19 relief programs intended to assist those facing financial difficulties due to the ongoing pandemic.
Zhang admitted that he submitted four fraudulent applications to three different lenders for forgivable loans under the Paycheck Protection Program (PPP), a SBA program that provided payroll assistance to small businesses. To support the loan applications, Zhang used fake entities for which he created fake payroll and tax records. Two of the fraudulent loan applications sought $600,000 each, a third application sought $325,000, and a fourth sought approximately $41,000. Zhang also submitted a fraudulent application to the SBA for an Economic Injury Disaster Loan (EIDL) in the name of one of the fake entities for which he also had applied for PPP loans. The SBA paid Zhang a $10,000 EIDL advance before his fraud was detected.
Zhang further admitted that he submitted fraudulent applications to two non-profit organizations providing grants to restaurant workers suffering economic hardship due to the pandemic. Zhang submitted the various applications in the names of Zhang, his wife, and his parents, falsely claiming that each were restaurant workers who had either lost their jobs or lost wages due to COVID-19. To support the applications, Zhang created fake letters from purported restaurant owners regarding employment and fake payroll records. In fact, neither Zhang nor his wife or parents worked in restaurants. Zhang obtained $1,500 from one of the non-profits before his fraud was detected.
Zhang also admitted that he submitted a fraudulent application to a multinational technology company headquartered in Seattle, Washington, that was providing grants to qualifying small businesses in the Seattle area. Zhang falsely claimed in his application that he ran a small business in a local shopping center that had suffered economically due to the pandemic. In fact, Zhang did not own any businesses. Zhang obtained $5,000 from the relief program before his fraud was detected.
In total, Zhang admitted to attempting to defraud the various COVID-19 relief programs of more than $550,000.
This case was investigated by the SBA-OIG, the TIGTA, and the FBI. Trial Attorney Amanda R. Vaughn of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Brian Werner of the Western District of Washington are prosecuting the case.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form
Seattle Software Developer Pleads Guilty to Wire Fraud for COVID-Relief Fraud SchemeRead the Press Release
A Seattle man pleaded guilty today to one count of wire fraud for carrying out a scheme to defraud several COVID-19 relief programs.
Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division, U.S. Attorney Brian T. Moran of the Western District of Washington, Special Agent in Charge Weston King of the U.S. Small Business Administration Office of Inspector General’s (SBA-OIG) Western Region, Treasury Inspector General for Tax Administration (TIGTA) J. Russell George, and Special Agent in Charge Raymond Duda of the FBI’s Seattle Field Office made the announcement.
Baoke Zhang, 35, of Issaquah, Washington, pleaded guilty to one count of wire fraud before U.S. Magistrate Judge Brian A. Tsuchida of the Western District of Washington.
As part of his guilty plea, Zhang admitted that he carried out a scheme to defraud several different government and private COVID-19 relief programs intended to assist those facing financial difficulties due to the ongoing pandemic.
Zhang admitted that he submitted four fraudulent applications to three different lenders for forgivable loans under the Paycheck Protection Program (PPP), a SBA program that provided payroll assistance to small businesses. To support the loan applications, Zhang used fake entities for which he created fake payroll and tax records. Two of the fraudulent loan applications sought $600,000 each, a third application sought $325,000, and a fourth sought approximately $41,000. Zhang also submitted a fraudulent application to the SBA for an Economic Injury Disaster Loan (EIDL) in the name of one of the fake entities for which he also had applied for PPP loans. The SBA paid Zhang a $10,000 EIDL advance before his fraud was detected.
Zhang further admitted that he submitted fraudulent applications to two non-profit organizations providing grants to restaurant workers suffering economic hardship due to the pandemic. Zhang submitted the various applications in the names of Zhang, his wife, and his parents, falsely claiming that each were restaurant workers who had either lost their jobs or lost wages due to COVID-19. To support the applications, Zhang created fake letters from purported restaurant owners regarding employment and fake payroll records. In fact, neither Zhang nor his wife or parents worked in restaurants. Zhang obtained $1,500 from one of the non-profits before his fraud was detected.
Zhang also admitted that he submitted a fraudulent application to a multinational technology company headquartered in Seattle, Washington, that was providing grants to qualifying small businesses in the Seattle area. Zhang falsely claimed in his application that he ran a small business in a local shopping center that had suffered economically due to the pandemic. In fact, Zhang did not own any businesses. Zhang obtained $5,000 from the relief program before his fraud was detected.
In total, Zhang admitted to attempting to defraud the various COVID-19 relief programs of more than $550,000.
This case was investigated by the SBA-OIG, the TIGTA, and the FBI. Trial Attorney Amanda R. Vaughn of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Brian Werner of the Western District of Washington are prosecuting the case.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Schenectady Man Indicted on Drug and Gun ChargesRead the Press Release
ALBANY, NEW YORK – Rhamel G. Pate, age 39, of Schenectady, New York, was charged today by a superseding indictment alleging three drug trafficking offenses and two gun possession charges.
The announcement was made by Acting United States Attorney Antoinette T. Bacon and Thomas F. Relford, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI).
Pate was first indicted on March 21, 2019, on one count of conspiracy to distribute and possess with intent to distribute crack cocaine and one count of distribution of crack cocaine. The superseding indictment additionally charges Pate with one count of possession with intent to distribute crack cocaine, one count of possession of firearms in furtherance of a drug trafficking crime, and one count of being a felon in possession of firearms. The charges in the indictment are merely accusations. The defendant is presumed innocent unless and until proven guilty.
Pate faces a minimum sentence of 5 years in prison and a maximum sentence of 40 years, for the drug conspiracy and possession charges, and a maximum sentence of 20 years for the drug distribution charge. For the charge of possession of firearms in furtherance of a drug trafficking crime, Pate faces a minimum sentence of 5 years, to be served after any other term of imprisonment is complete. For being a felon in possession of firearms, Pate faces a maximum sentence of 10 years.
A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines, and other factors.
This case is being investigated by the FBI and its Capital District Safe Streets Gang Task Force, and is being prosecuted by Assistant U.S. Attorney Emily C. Powers.
Sacramento Man Indicted for Production and Possession of Child PornographyRead the Press Release
SACRAMENTO, Calif. — A federal grand jury returned a one-count indictment today against Jayson Fernandez Butay, 25, of Sacramento, charging him with production and possession of child pornography, U.S. Attorney McGregor W. Scott announced.
According to court documents, Butay produced child pornography with a minor victim on Sept. 28, 2019, and possessed prepubescent images of child pornography.
This case is the product of an investigation by the Federal Bureau of Investigation. Assistant U.S. Attorney Tanya B. Syed is prosecuting the case.
If convicted of the production of child pornography count, Butay faces minimum of 15 years in prison, a maximum statutory penalty of 30 years in prison, and a $250,000 fine. If convicted of the possession of child pornography charge, Butay faces a maximum statutory penalty of 10 years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about internet safety education.
Richland Man Sentenced to 21 Years in Federal Prison and 40 Years of Supervision for Child Pornography OffensesRead the Press Release
Spokane – William D. Hyslop, United States Attorney for the Eastern District of Washington, announced that Beau Thomas Upton, age 30, of Richland, Washington, was sentenced today after pleading guilty to production of child pornography. United States District Judge Salvador Mendoza, Jr., sentenced Upton to 21 years in federal prison, to be followed by 40 years of court supervision after he is released. Judge Mendoza also required Upton to register as a sex offender upon completion of his prison sentence. As part of the resolution of the case, Upton has also agreed to plead guilty to two counts of Third Degree Rape of a Child in Benton County Superior Court.
The investigation began when officers and detectives with the Richland and Kennewick Police Departments joined agents from the United States Department of Homeland Security Investigations (“HSI”) to investigate a ring of adult men who were drugging teenage boys in the Tri-Cities, engaging in illicit sexual activity with them, and recording the sexual abuse. Judge Mendoza has previously sentenced Defendants Zayne Barbre (28 years) and Ryan Alexander (25 years) to lengthy federal terms, each to be followed by a lifetime of supervision.
In March 2017, law enforcement officers executed a search warrant at Barbre’s residence in Richland, Washington, where they learned that Barbre had been harboring a 14-year-old victim whom he had been drugging, prostituting, and sexually abusing. Officers discovered a makeshift child pornography production studio, with a MacBook computer propped up on a wooden box, positioned so its web camera could record sexual abuse on a bed on the floor in front of the computer. On a desk was a small digital camera taped to another wooden box, pointed into the room.
One minor victim reported that he had been introduced to Barbre by Upton, and that in 2016, Barbre and Upton had begun drugging and sexually abusing him, sometimes alone and sometimes together, and sometimes while recording the abuse in the makeshift child production studio in Barbre’s house.
When officers forensically examined the digital devices recovered from Barbre’s house, they found numerous videos depicting Barbre and Upton having sexual intercourse with males appearing to be younger than themselves, from 2015 through 2016. One such video depicted Barbre adjusting the recording device while Upton looked on, prior to recording a sexual act with a young male. Officers also recovered text messages between Barbre and Upton that corroborated that they had engaged in group sex on more than one occasion with at least one 14-year-old victim and another male.
In a related investigation, officers learned that Ryan Alexander had been grooming boys online, teaching them how to use and sell marijuana, and then sexually assaulting them while obtaining pornographic images of them. Alexander also obtained child pornography images of one minor, and then pretended to be that minor to induce a different minor to take and send child pornography of himself to Alexander. When the Richland Police Department conducted a sophisticated forensic examination of Alexander’s digital devices, they recovered hundreds of images of child pornography, including sexual images of children that depicted violence, sadomasochism, toddlers, and infants.
United States Attorney William D. Hyslop said “Today’s sentencing hearing brings to a close the investigations into three individuals who engaged in truly heinous sexual abuse of minors. I hope that the victims and their families are able to gain a sense of resolution as they move forward with their lives. There is no greater priority than the protection of children and teenagers from sexual harm. The sentences imposed in these three cases are a clear message to anyone in Eastern Washington who has the criminal audacity not only to abuse minors, but to record their hideous conduct: if you do something terrible like this, we will find you, we will prosecute the case, and you should expect that a multi-decade sentence in federal prison awaits you. The United States Attorney’s Office is proud to partner with law enforcement and victim services professionals from around the region to prevent and deter these kinds of crimes. I commend HSI and the Richland and Kennewick Police Departments, the Southeast Regional ICAC Task Force, and the Support, Advocacy, and Resource Center (“SARC”) in the Tri-Cities for their sensitive and professional approach to these three cases, and I thank them for their tireless work in combating child exploitation.”
Chief John Bruce of the Richland Police Department said “The crimes which exploit children are some of the worst we encounter and have lasting impacts on the victims and their families. We will continue to collaborate with our partners in the WA-ICAC Task Force and support our local Southeast Regional ICAC Task Force in their pursuit of those who prey upon the vulnerable.”
This case was pursued as part of Project Safe Childhood (“PSC”), a nationwide initiative launched in May 2006 by the United States Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Department of Justice Criminal Division’s Child Exploitation and Obscenity Section, PSC marshals federal, state, and local law enforcement work together to locate, apprehend, and prosecute individuals, who sexually exploit children, and to identify and rescue victims. The PSC Initiative has five major components:
· Integrated federal, state, and local efforts to investigate and prosecute child exploitation cases, and to identify and rescue children;
· Participation of PSC partners in coordinated national initiatives;
· Increased federal enforcement in child pornography and enticement cases;
· Training of federal, state, and local law enforcement agents; and
· Community awareness and educational programs.
For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
This case was investigated by the Richland and Kennewick Police Departments and Homeland Security Investigations, along with the Southeast Regional Internet Crimes Against Children (“ICAC”) Task Force, which is located in Richland, Washington. Victim services were provided by the Support, Advocacy, and Resource Center (“SARC”) in the Tri-Cities. The case was prosecuted by David M. Herzog, Assistant United States Attorney for the Eastern District of Washington.
Registered sex offender pleads guilty to distributing child pornographyRead the Press Release
CORPUS CHRISTI, Texas – A 28-year-old Corpus Christi man has admitting to sending photos depicting the sexual exploitation of children, announced U.S. Attorney Ryan K. Patrick.
Authorities had linked Daniel Ellsworth Janssen to an e-mail and IP address that was accessing child pornography. Law enforcement conducted a search, at which time they seized multiple electronic devices from Janssen’s Corpus Christi residence. A forensic examination later revealed images and videos of child pornography, some of which he had distributed using his cell phone. The majority of the images and videos located on Janssen’s devices depicted the sexual exploitation of children under the age of 10.
At the time of his arrest, Janssen was a registered sex offender following his conviction for attempted indecency with a child.
Sentencing has been set before U.S. District Judge David S. Morales Jan, 25, 2021. At that time, Janssen faces a mandatory minimum of 15 and up to 40 years in federal prison as well as a possible $250,000 maximum fine.
The Corpus Christi Police Department Internet Crimes Against Children Task Force and Immigration and Custom’s Enforcement’s Homeland Security Investigations conducted the investigation.
Assistant U.S. Attorney Sara Popejoy is prosecuting the case which was brought as part of Project Safe Childhood (PSC), a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, PSC marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children and to identify and rescue victims. For more information about PSC, please visit DOJ’s PSC page. For more information about internet safety education, please visit the resources tab on that page.
Previously Convicted Felon Admits Unlawfully Possessing FirearmRead the Press Release
TRENTON, N.J. – A Monmouth County, New Jersey, man today admitted to being a felon in possession of a firearm, U.S. Attorney Craig Carpenito announced.
Jakim Stradford, 27, of Neptune City, New Jersey, pleaded guilty by videoconference before Chief U.S. District Judge Freda L. Wolfson to an indictment charging him with one count of being a felon in possession of a firearm.
According to documents filed in this case and statements made in court:
On Feb. 26, 2020, officers from the Neptune City Police Department responded to the home of a local resident who reported trespassers in her patio. Officers found Stradford – a convicted felon prohibited from possessing a firearm – and another man in the enclosed patio of an apartment. The officers ordered the men to stop, but Stradford attempted to run. Officers arrested and searched Stradford, finding marijuana, pills and a Hi-Point 9mm caliber pistol. Examination of the pistol revealed that the serial number had been obliterated.
The felon in possession of a firearm charge carries a maximum potential penalty of 10 years in prison and a $250,000 fine. Sentencing is scheduled for Feb. 25, 2021.
This case is part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local and tribal authorities in investigating and prosecuting gun crimes; improves information sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensured that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see https://www.justice.gov/projectguardian.
U.S. Attorney Carpenito credited special agents of the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent in Charge Charlie J. Patterson, Newark Field Division, Trenton Field Office, with the investigation leading to today’s guilty plea. He also thanked the Monmouth County Prosecutor’s Office, under the direction of Prosecutor Christopher J. Gramiccioni, and the Neptune City Police Department, under the direction of Chief Matthew Quagliato for their assistance with the investigation.
The government is represented by Special Assistant U.S. Attorney Christopher Matthews of the Criminal Division in Trenton.
Parolee-Felon Sentenced for Illegally Possessing FirearmsRead the Press Release
United States Attorney Joe Kelly announced that Emmanuel John, 25, was sentenced today by United States District Judge Brian C. Buescher to 290 months in the Bureau of Prisons after being found guilty by a jury in July of six counts of being a felon in possession of a firearm. He will serve three years of supervised release following his release from prison. There is no parole in the federal system.
Between July 2018 and August 2018, John illegally sold eight guns to a confidential informant during six separate controlled buys. Four of the firearms were reported as stolen. At the time of the sales, John, a Trip Set gang member, was out on parole for two robbery convictions. As a convicted felon, he is prohibited from possessing a firearm. It had been just 65 days from John’s release on parole until he committed the first of the six offenses of which he was convicted. Following his arrest on the federal case, John’s parole was revoked and he was sent back to the Nebraska Department of Corrections. He came into federal custody on March 24, 2020.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and Omaha Police Department as part of Project Safe Neighborhood. Project Safe Neighborhood is a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime. John’s arrest was also part of Operation South Sudan Soldiers which targeted members of the Trip Set and African Pride street gangs.
Owner of Mexican Seafood Restaurants Pleads Guilty to Charges of Obstructing Investigation into Wage Violations and Federal Tax FraudRead the Press Release
SANTA ANA, California – The owner of a chain of Mexican seafood restaurants pleaded guilty this afternoon to criminal charges for obstructing a federal investigation into his failure to pay minimum wage and overtime to his employees.
Victor Hugo Guzman, 49, of La Habra, pleaded guilty this afternoon to one count of obstruction of a federal investigation and one count of filing a false tax return.
Guzman was the owner and operator of the Ostioneria Colima restaurant chain, which had locations in Orange and Los Angeles counties. Guzman admitted in a plea agreement that he failed to pay overtime wages to employees. For some employees, Guzman also paid them less than the minimum wage.
Guzman admitted that, from 2011 through 2014, some employees worked 12 hours a day, six days a week, but he only paid them a flat weekly salary of $320 – or only $4.44 per hour, well below California’s then-minimum wage of $8 per hour.
According to the plea agreement, when federal investigators began to probe suspected overtime wage violations and violations of the Fair Labor Standards Act, Guzman obstructed that investigation by hiring someone who fabricated records and by instructing employees to lie to the federal investigators about the number of hours they had worked. Guzman caused fabricated timecards to be submitted to the Department of Labor, which showed that employees had worked a maximum of only 40 hours per week, when in fact, those employees had been working 60 to 72 hours per week.
In addition to obstructing the Labor Department’s investigation, Guzman admitted he caused the filing of false payroll tax returns with the IRS for several years. Those filings underreported the amount of wages he was paying his employees, which resulted in the underpayment of federal payroll taxes. Guzman admitted that the tax loss from those false tax returns was approximately $79,000.
In addition to agreeing to pay back taxes to the IRS, Guzman agreed in his plea agreement to pay more than $200,000 in back wages to employees.
United States District Judge Josephine L. Staton scheduled a sentencing hearing on April 23, 2021, at which time Guzman will face a statutory maximum sentence of eight years in federal prison.
This matter was investigated by the U.S. Department of Labor – Office of the Inspector General and IRS Criminal Investigation. The U.S. Department of Labor, Wage and Hour Division, provided substantial assistance.
This case is being prosecuted by Assistant United States Attorney Charles E. Pell of the Santa Ana Branch Office.
Office for Victims of Crime Awards Nearly $4 Million to Support Sexual Assault Nurse Examiner ProgramsRead the Press Release
The Office of Justice Programs’ (OJP) Office for Victims of Crime (OVC) announced that it has awarded almost $4 million to support the establishment or expansion of Sexual Assault Nurse Examiner (SANE) programs that offer medical forensic care, advocacy and other victim services to sexual assault survivors on campuses of higher education. OJP Principal Deputy Assistant Attorney General Katharine T. Sullivan made the announcement during a roundtable discussion with U.S. Attorney for the Western District of Pennsylvania Scott W. Brady, OVC Director Jessica E. Hart, Dean of Duquesne University School of Nursing Mary Ellen Glasgow, and law enforcement leaders from Pittsburgh and surrounding jurisdictions.
“Victims of sexual assault deserve the best of care, including expert medical forensic attention that can help close out cases and bring perpetrators to justice,” said OJP Principal Deputy Assistant Attorney General Sullivan. “These grants will build a cadre of skilled medical professionals capable of responding immediately and holistically to the needs of sexual assault survivors. Making SANE Nurse positions available on college campus will help ensure survivors receive the trauma informed care they deserve and vital forensic evidence will be collected to ensure perpetrators are held accountable.”
“Nurses serving on the front lines of our communities are often the first to respond to and treat victims of sexual assault,” said U.S. Attorney Brady. “Far too many victims endure the physical and emotional trauma of a sexual assault only to wait long hours and have forensic exams conducted by personnel who lack the appropriate training and experience in forensic evidence collection. These SANE grants will allow our universities to create a pipeline of highly-skilled registered nurses to support victims of sexual assault and hold offenders accountable.”
This program will develop, expand or strengthen SANE services to improve the delivery of post-assault medical and advocacy services. Campuses will collaborate with victim service providers in the communities in which the institutions are located. If victim services programs are not available in the community or are not accessible to students, the institution will provide a victim services program on campus in collaboration with a community-based organization.
“Sexual assault is an appalling crime and an obscene violation of personal security and interpersonal trust,” said Director Hart. “The resources we are making available today will help institutions of higher learning bring comfort and relief to victims while widening the possibility for securing justice.”
OVC awarded $3,836,877 to eight institutions, listed below. Funds will help raise awareness and expand outreach about the SANE program and will provide more SANE services to survivors. Operational costs (including salaries and benefits for program staff), training and mentoring for aspiring and current SANEs and advocates, and equipment costs can be supported under this program. This program aims to respond to and empower sexual assault survivors while increasing perpetrator accountability.
- University of South Alabama, Alabama
- Total Awarded $493,244
- Arizona Board of Regents, University of Arizona, Arizona
- Total Awarded $499,382
- Duquesne University, Pennsylvania
- Total Awarded $499,391
- The Pennsylvania State University, Pennsylvania
- Total Awarded $500,000
- The Spartanburg Regional Healthcare System Foundation, South Carolina
- Total Awarded $345,926
- Tennessee Technological University, Tennessee
- Total Awarded $500,000
- The University of Texas Rio Grande Valley, Texas
- Total Awarded $499,948
- The Board of Regents of the University of Wisconsin System, Wisconsin
- Total Awarded $498,986
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The Office of Justice Programs, directed by Principal Deputy Assistant Attorney General Katharine T. Sullivan, provides federal leadership, grants, training, technical assistance and other resources to improve the nation’s capacity to prevent and reduce crime, assist victims and enhance the rule of law by strengthening the criminal and juvenile justice systems. More information about OJP and its components can be found at www.ojp.gov.
- University of South Alabama, Alabama
North Carolina Man Is Sentenced to Prison for Conspiring to Steal Millions from MedicaidRead the Press Release
CHARLOTTE, N.C. – Today, U.S. District Judge Robert J. Conrad Jr. sentenced Jerry Lewis Taylor, 55, of Wingate, N.C., to five years in prison followed by two years of supervised release, for conspiring to steal millions from Medicaid and committing tax evasion, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina. In addition to the prison term imposed, Jerry Taylor was also ordered to pay more than $6.1 to North Carolina Medicaid and over $346,000 to the U.S. Internal Revenue Service as restitution.
On Tuesday, October 20, 2020, Jerry Taylor’s co-conspirator, Ameera Ali, 41, of Columbus, Ohio, was sentenced to 84 months in prison and one year of supervised release, for her role in the scheme. In July 2020, the leader of the scheme, Tony Garrett Taylor, 40, of Brooklyn, N.Y., was sentenced to 96 months in prison and two years of supervised release.
Tommy D. Coke, Inspector in Charge of the Atlanta Division of the U.S. Postal Inspection Service, which oversees Charlotte, Robert W. Wells, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, Matthew D. Line, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division, Charlotte Field Office (IRS-CI), and Attorney General Josh Stein, who oversees the North Carolina Medicaid Investigations Division (MID), join U.S. Attorney Murray in making today’s announcement.
According to filed court documents and today’s sentencing hearing, from June 2015 to December 2017, Jerry Taylor and his brother, Tony Taylor, orchestrated a scheme to defraud Medicaid of more than $9.4 million by submitting false and fraudulent reimbursement claims for patient services that were either non-existent or mischaracterized to Medicaid. The brothers submitted the fraudulent claims through several companies they owned and/or operated, including Taylor Behavioral Health Center, LLC and Options Driven LLC, both located in Monroe, N.C.; Design for Change LLC located in Raleigh and elsewhere; and SHG Consultants, located in Gastonia, N.C. and elsewhere (collectively, the “the entities”). These entities specialized in providing outpatient behavioral health services to at-risk youth throughout North Carolina.
Court records show that, during the relevant time period, Jerry Taylor was responsible for overseeing certain aspects of the business operations of the entities, including managing the preparation and submission of fraudulent claims through the entities’ third-party billing company owned by Ameera Ali. According to court records, in addition to providing billing services for the conspiracy, Ameera Ali furnished Tony Taylor with prospective patient lists containing identifying information for eligible Medicaid beneficiaries. The beneficiary information obtained from Ali and others were used, in turn, to file fraudulent reimbursement claims for services that were never provided. To the extent that services were actually provided, the conspirators submitted to Medicaid fraudulent reimbursement claims that misrepresented the services rendered so as to obtain a higher reimbursement rate, a practice known as “upcoding.”
According to court documents, Tony Taylor also recruited Devon Rambert-Hairston, a licensed nurse practitioner and the director of one of the entities operated by the brothers, to review and sign-off on fictitious patient progress notes. Court records show that Rambert-Hairston never provided any behavioral health or medical services to the Medicaid beneficiaries or rarely interacted with them at all. To the extent that the beneficiaries received any treatment, those services were provided by an individual identified in court documents as J.B., who was not credentialed to provide those types of services.
Jerry Taylor and Tony Taylor also conspired with Christine Yvette Knight, who operated Connect and Move Staffing LLC in Florida. Knight’s role in the conspiracy was to create fraudulent treatment notes for the beneficiaries, and to prepare fake billing spreadsheets which were used by the brothers to further perpetuate the fraud.
During the course of the fraudulent scheme, Jerry and Tony Taylor caused hundreds of false and fraudulent claims to be submitted to Medicaid for false and fraudulent services. As a result, more than $9.4 million in fraudulent claims were submitted to Medicaid, resulting in approximately $6.1 million in fraudulent payments from Medicaid.
In addition to health care fraud, Jerry Taylor also committed tax evasion, by failing to file timely and/or accurate U.S. Individual Income Tax Returns for tax years 2016 and 2017, and failing to report more than $1.6 million in fraudulent receipts from Medicaid that were diverted to nominee entities and individuals. Jerry Taylor used the fraudulent proceeds for personal expenditure using business accounts, including to pay for medical expenses, personal travel, and to make large cash withdrawals, among other things.
In announcing Jerry Taylor’s sentence, Judge Conrad described the fraud as sophisticated and said the defendants preyed upon government institutions and taxpayers.
Devon Rambert-Hairston was previously sentenced to a year and a day in prison and a year of supervised release, and was ordered to pay $813,726 in restitution. Christine Yvette Knight has pleaded guilty to making a false statement relating to health care matters and is currently awaiting sentencing.
In making today’s announcement U.S. Attorney Murray thanked the USPIS, the FBI the IRS, and North Carolina’s MID for their investigation of this case.
Assistant U.S. Attorneys Michael Savage and William Bozin of the U.S. Attorney’s Charlotte Office are prosecuting the case.
If you suspect Medicare or Medicaid fraud please report it by phone at 1-800-447-8477 (1-800-HHS-TIPS), or E-Mail at [email protected].
Niagara Falls Man Going to Prison for More Than 11 Years on Cocaine Conspiracy and Gun ChargesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Rhyan O. Stewart, 47, of Niagara Falls, NY, who was convicted of conspiring to possess with intent to distribute five kilograms or more of cocaine, and being a felon in possession of a weapon, was sentenced to serve 135 months in prison by U.S. District Judge Lawrence J. Vilardo.
Assistant U.S. Attorney Misha A. Coulson, who handled the case, stated that in December 2016, co-conspirator John L. Maye arranged for the delivery of a U.S. Postal Service parcel to a residence on North Avenue in Niagara Falls, NY. The parcel contained a quantity of cocaine from a California source of supply that Maye intended to distribute in the Niagara Falls and Buffalo areas. Defendant Stewart and Maye offered to pay another individual to take delivery and safeguard the parcel.
Unbeknownst to Stewart, Maye, and the third individual, the parcel was intercepted by the U.S. Postal Service and was searched prior to its delivery. Five separately wrapped kilogram-sized bricks of cocaine were discovered inside. Sham material was substituted for the cocaine and controlled delivery of the package was conducted on December 27, 2016, at the North Avenue residence.
As instructed by Stewart, the third individual received the package, signed for it, and brought it inside the residence. During the delivery, Stewart and Maye conducted counter-surveillance, and observing the presence of law enforcement, the two instructed the individual to leave the residence without the package. The individual left the residence, and the parcel containing the sham material was recovered from within the residence shortly thereafter. Subsequently, on October 13, 2017, the Niagara Falls Police Department received a citizen complaint alleging that Stewart had stored a quantity of controlled substances in the basement of his residence on LaSalle Avenue in Niagara Falls. During a search of the residence, officers recovered two firearms, including one that was reported stolen, and a quantity of cocaine. Stewart was previously convicted on three different occasions in Niagara County Court and is legally prohibited from possessing a firearm.
John Maye was previously convicted and is awaiting sentencing.
The sentencing is the result of an investigation by the Niagara Falls Police Department, under the direction of Superintendent Thomas Licata; the Drug Enforcement Administration, under the direction of Special Agent-in-Charge Ray Donovan, Special Agent-in-Charge, New York Field Division; the United States Postal Inspection Service, under the direction of Inspector-in-Charge Joseph W. Cronin of the Boston Division; and the Bureau of Alcohol, Tobacco, Firearms, and Explosives, under the direction of Special Agent-in-Charge John B. Devito, New York Field Division.
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Navajo man sentenced to three years in prison for assault resulting in serious bodily injuryRead the Press Release
ALBUQUERQUE, N.M. – Derwin Williams, 44, an enrolled member of the Navajo Nation, was sentenced on Oct. 21 in federal court in Albuquerque to three years in prison to be followed by three years of supervised release for assault resulting in serious bodily injury in Indian Country.
Williams pleaded guilty on June 5. In his plea, Williams admitted to committing the assault on April 23, 2017, on the Navajo Nation. According to a grand jury indictment, Williams and two defendants, Marty Manuelito, 45, and Joelson Talk, 44, who are also members of the Navajo Nation, allegedly went to the victim’s home to retrieve a firearm when they began hitting and kicking the victim, resulting in multiple cuts to his body and face, a broken tooth, fractures to his nose and spine and a concussion.
Talk pleaded guilty on July 24 and his sentencing is scheduled for Nov. 18. Manuelito entered a plea of not guilty on Aug. 8, 2019, and is awaiting trial.
The FBI and Navajo Nation Police Department investigated this case. Assistant U.S. Attorney Nicholas Marshall prosecuted the case.
National Prescription Drug Take Back Day Is SaturdayRead the Press Release
MACON, Ga. – DEA is holding its 19th National Prescription Drug Take Back Day on Saturday, Oct. 24 at locations across the country, including several within the Middle District of Georgia, said Charlie Peeler, the U.S. Attorney for the Middle District of Georgia.
The nationwide event aims to provide a safe, convenient, and responsible means of disposing of prescription drugs, while also educating the general public about the potential for abuse of medications.
Rates of prescription drug abuse in the United States are alarmingly high, as are the number of accidental poisonings and overdoses due to these drugs. Studies show that many abused prescription drugs are obtained from family and friends, including from the home medicine cabinet.
Collection sites will adhere to local COVID-19 guidelines and regulations in order to maintain the safety of all participants and local law enforcement. People can find a collection site by visiting www.deatakeback.com and searching under their zip code or city. According to the website, several communities currently have collection locations in the Middle District of Georgia, including those operated by Athens-Clarke County Police Department, Calhoun County Sheriff’s Office, Camilla Police Department, Jones County Sheriff’s Office, Monroe County Sheriff’s Office, Monroe Police Department, Perry Police Department, Royston Police Department and Sumter County Sheriff’s Office. New collection sites are being added daily.
“DEA Prescription Drug Take Back Day offers citizens a great opportunity to safely dispose of unwanted medicines and prevent those drugs from being stolen and abused. Prescription drug abuse is a blight on our country. We can all do our part to curtail this epidemic by simply cleaning out our medicine cabinets and securely disposing of prescription drugs at a take-back location this Saturday, no questions asked,” said U.S. Attorney Peeler. “I want to thank the many law enforcement agencies in the Middle District of Georgia for participating in DEA Prescription Drug Take Back Day. It’s a great service to our state.”
“The initiative – now in its tenth year – addresses a vital public safety and public health issue,” said DEA Acting Administrator Timothy Shea. “Medicines that languish in home cabinets are highly susceptible to diversion, misuse, and abuse. Together with our partners, we are not only holding National Prescription Drug Take Back Day, but offering other ways to dispose of unwanted, unused, and expired prescription medications.”
“Even in the midst of the pandemic, DEA’s nineteenth take-back event will allow Americans to safely and properly dispose of their unwanted/unused prescription medications,” said the Special Agent in Charge of the DEA Atlanta Field Division Robert J. Murphy. “Collection sites will adhere to local COVID-19 guidelines and regulations in order to maintain the safety of all participants and local law enforcement. DEA will work hand-in-hand with a number of law enforcement, Tribal and community partners, all in effort to stem the tide of prescription drug abuse.”
Georgians participating in the DEA’s last (18th) take back event, which was held on Saturday, October 26, 2019 turned in 5,900 pounds of unwanted or expired medications for safe and proper disposal at sites set up throughout the state. During this year’s event, given the ongoing COVID-19 public health emergency, DEA wants to ensure that the public is aware of other ways they can dispose of unwanted prescription drugs without having to leave their homes. Both the U.S. Food and Drug Administration and the Environmental Protection Agency have tips on how to safely dispose of drugs at home.
In addition to DEA’s National Prescription Drug Take Back Day, prescription drugs can be disposed of at any of the 11,000 DEA authorized collectors at any time throughout the year. For more information, visit www.deatakeback.com and click on “”Year-Round Drug Disposal” to locate disposal sites. DEA also encourages the public to reach out to their local law enforcement to find out if they have any permanent drug disposal locations throughout their local community.
DEA and its partners will collect tablets, capsules, patches, and other solid forms. DEA will also accept vape pens or other e-cigarette devices from individual consumers, only after the batteries are removed from the devices. If the battery cannot be removed, individual consumers can check with large electronic chain stores who may accept the vape pen or e-cigarette devices for proper disposal. Liquids, including intravenous solutions, syringes and other sharps, and illegal drugs cannot be dropped off. This service is free and anonymous, no questions asked.
For more information on DEA’s National Prescription Drug Take Back Day, and to find a collection site near you, visit www.deatakeback.com. Questions can be directed to Pamela Lightsey, Public Information Officer, United States Attorney’s Office, at (478) 621-2603 or Melissa Hodges, Public Affairs Director (Contractor), United States Attorney’s Office, at (478) 765-2362.
Muskogee Man Pleads Guilty to Use, Carry and Discharge of A Firearm During and in Relation to A Crime of ViolenceRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that David Neil Dunn, a/k/a David Neil Dunn, Jr, age 20, of Muskogee, Oklahoma entered a guilty plea to Use, Carry, and Discharge of a Firearm During and in Relation to a Crime of Violence, in violation of Title 18, United States Code, Section 924(c)(1)(A)(iii), punishable by not less than 10 years imprisonment to run consecutive to any other term of imprisonment imposed, a fine up to $250,000.00, or both.
The Indictment alleged that on or about October 9, 2019, within the Eastern District of Oklahoma, the defendant, did knowingly use, carry, and discharge a firearm, during and in relation to a crime of violence for which he may be prosecuted in a court of the United States.
The charges arose from an investigation by the Federal Bureau of Investigation.
The Honorable Kimberly E. West, U.S. Magistrate Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, accepted the plea and ordered the completion of a presentence investigation report.
Multi-pound meth trafficker in Billings sentenced to 10 years in prisonRead the Press Release
BILLINGS – A Billings man who admitted trafficking methamphetamine after investigators found more than 30 pounds of the drug and $11,380 cash in his vehicle and residence was sentenced today to 10 years in prison and five years of supervised release, U.S. Attorney Kurt Alme said.
Jerry Ray Schuster, 57, pleaded guilty in January to conspiracy to possess with intent to distribute meth and to possession with intent to distribute meth.
U.S. District Judge Susan P. Watters presided. Schuster was allowed to self surrender.
The prosecution said in court records that an investigation into meth trafficking led to Schuster and a co-defendant, Byrne Martin Mestas. Mestas, 63, of Billings, was sentenced to 15 years in prison in August for conviction on a conspiracy charge in the case.
Law enforcement served a search warrant at Schuster’s and Mestas’ trailer on May 3, 2019. In the residence, agents found one pound of meth, three rifles, drug paraphernalia and receipts corroborating trips to California. A pound of meth is the equivalent of about 3,624 doses.
Agents executed a second search warrant three days later on four vehicles located at the residence. Investigators found 30 pounds of meth in three backpacks, $11,380 in cash and receipts documenting a trip to California in a Suzuki Swift registered to Schuster. Thirty pounds of meth is the equivalent of about 108,720 doses. In the other three vehicles, agents found another pound of meth, 100 pills, cash and other items.
Assistant U.S. Attorney Julie Patten prosecuted the case, which was investigated by the FBI Task Force and the Eastern Montana High Intensity Drug Trafficking Area Task Force.
This case is part of Project Safe Neighborhoods, a U.S. Department of Justice initiative to reduce violent crime. According to the FBI’s Uniform Crime Reports, violent crime in Montana increased by 36% from 2013 to 2018. Through PSN, 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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Monongalia County man admits to firearms chargeRead the Press Release
CLARKSBURG, WEST VIRGINIA – Andrew Douglas Packard, of Morgantown, West Virginia, has admitted to a firearms charge, U.S. Attorney Bill Powell announced.
Packard, age 30, pled guilty to one count of “Unlawful Possession of Firearm.” Packard, who is prohibited from having firearms, admitted to having a 9mm Glock pistol, a multi-caliber pistol, a 12-gauge shotgun, a 410-gauge shotgun, and a rifle in April 2018 n Monongalia County.
Packard faces up to 10 years of incarceration and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Sarah E. Wagner is prosecuting the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms & Explosives and the Morgantown Police Department investigated.
U.S. Magistrate Judge Michael John Aloi presided.
Methamphetamine Distributors Sentenced to Federal PrisonRead the Press Release
Jacksonville, FL – U.S. District Judge Marcia Morales Howard has sentenced Nicholas Paul Mattox (50, Jacksonville) to 10 years in federal prison for distribution of 50 grams or more of actual methamphetamine, and Keith Wallace Williams (61, Middleburg) to 5 years in federal prison for possession with the intent to distribute 50 grams or more of a mixture and substance containing a detectable amount of methamphetamine. In addition, a total of $32,200 was forfeited, which is traceable to proceeds of the offenses.
Mattox had pleaded guilty on April 6, 2020, and Williams had pleaded guilty on July 13, 2020.
According to court documents, in May 2019, agents with the Drug Enforcement Administration began investigating Mattox, who was distributing ounce to kilogram quantities of crystal methamphetamine in Duval and Clay counties. Agents used a confidential source to make a series of controlled purchases from Mattox, who is accountable for more than 600 grams of methamphetamine.
The investigation revealed that Williams had purchased methamphetamine from Mattox. As a result, DEA and Clay County Sheriff’s Office continued the investigation jointly. On October 31, 2019, the Clay County Sheriff’s Office executed a search warrant at Williams’s home. The officers found more than 200 grams of methamphetamine hidden inside a rubber duck chlorine tablet holder on Williams’s porch. Williams is accountable for more than 200 grams of methamphetamine.
This case was investigated by the Drug Enforcement Administration Jacksonville District Office and the Clay County Sheriff’s Office. It was prosecuted by Assistant United States Attorney Beatriz Gonzalez.
Maryland Woman Sentenced to Federal Prison After Obstructing Justice in Cyber Fraud InvestigationRead the Press Release
United States Attorney Brandon J. Fremin announced that U.S. District Judge Brian A. Jackson sentenced Fatima Sesay, age 29, of Laurel, Maryland, to serve 16 months in federal prison following her conviction for obstruction of justice. The court also ordered Ms. Sesay to serve two years of supervised release following her release from prison.
Earlier this year, Sesay was convicted of obstruction of justice, in violation of Title 18, United States Code, Section 1503, after she made numerous statements intended to mislead and deceive a pending federal grand jury investigation into a computer fraud that affected a business in Greenwell Springs, Louisiana, among other victims. In the underlying fraud, after the victim shipped tens of thousands of dollars’ worth of its products to a customer in Amman, Jordan, the customer received a series of fraudulent e-mails directing it to send payment to an account at Wells Fargo Bank. Relying on the messages and wiring instructions, the customer wired the requested funds to the account. The Louisiana-based victim had not sent the e-mails, however, and unbeknownst to the customer, the wiring instructions were fraudulent. The Export-Import Bank of the United States (EXIM Bank) had insured the underlying transaction, and the EXIM Bank’s Office of Inspector General quickly began investigating the fraud.
The investigation eventually revealed that in July of 2016, after a series of transactions, the proceeds from the fraud were deposited into a Bank of America account that Sesay had opened in Maryland earlier that year. In fact, between November 2015 and September 2016, across dozens of suspicious transactions, nearly $500,000 had passed through accounts maintained in the defendant’s name. Federal authorities contacted Sesay and made several attempts to secure truthful information from her about her knowledge of the scheme. Instead, as Sesay has admitted, she knowingly obstructed the investigation, first by making numerous evasive and misleading statements in an interview with federal agents in January 2019, and then by providing false testimony before a federal grand jury in Baton Rouge in April 2019. The defendant repeatedly minimized the extent of her relationship with one of the subjects of the investigation and provided false information intended to divert the federal investigation into the underlying cyber fraud.
U.S. Attorney Fremin stated, “A basic underpinning of our system of justice is that participants on all sides remain open and honest. Candid participation in the criminal justice process is critical to the pursuit of justice, and those who intentionally mislead, obstruct, or lie to a grand jury in our investigations will be held accountable. This conviction and sentence clearly demonstrates how seriously we in the federal system treat those who obstruct justice. I commend our prosecutor and the Export-Import Bank of the United States – Office of Inspector General for their excellent work in this matter.”
EXIM Bank is the official export credit agency of the United States, and assists in financing the export of U.S. goods and services to international markets. Complaints and reports of waste, fraud, and abuse related to EXIM Bank programs and operations can be reported to the OIG hotline at 888-OIG-EXIM (888-644-3946) or via email at [email protected].
This matter was investigated by the Export-Import Bank of the United States – Office of Inspector General, and was prosecuted by Assistant United States Attorney Alan A. Stevens, who also serves as Senior Litigation Counsel of the Criminal Division.
Man with Out-of-State Ties Pleads Guilty to Conspiracy to Distribute MethamphetamineRead the Press Release
HARRISONBURG, Va.- Adam Kimball, a man from outside of Virginia with ties to California and South Dakota, pleaded guilty this week in U.S. District Court in Harrisonburg to conspiring to distribute methamphetamine and possessing with the intent to distribute methamphetamine, Acting United States Attorney Daniel P. Bubar announced today.
Kimball, 43, waived his right to be indicted and pleaded guilty this week to a two-count Information charging him with one count of conspiring with others to distribute 50 grams or more of actual methamphetamine and 500 grams or more of a substance containing a detectable amount of methamphetamine and one count of possession with the intent to distribute 50 grams or more of methamphetamine.
According to court documents, Kimball conspired with others to have large quantities of methamphetamine shipped into Virginia from sources outside of the Commonwealth using the United States Postal Service to various addresses in and around Winchester, Virginia. Once in possession of the methamphetamine, members of the conspiracy, including co-defendants Jerry Duncan and John O'Donnell, moved the drugs to other locations and prepared them for distribution to users.
Kimball was an active member of the conspiracy beginning in early 2019. He “hooked” his co-conspirators with an out-of-state source of supply that could deliver large quantities of methamphetamine. Kimball and his co-conspirators used a residence in the Winchester area as a base for their operations. Kimball was involved in arranging the delivery of methamphetamine from the source of supply and he was involved in the wiring of payment to the source of supply. Kimball also participated in the sale of methamphetamine.
Initially, the conspirators received one or two ounces of methamphetamine per week, but this increased over time to one-quarter-pound purchases, one-pound purchases, and ultimately multi-pound purchases from the out of state source of supply. While a member of the conspiracy, Kimball was involved in the receipt and distribution of at least two kilograms of methamphetamine.
The investigation of the case was conducted by Drug Enforcement Administration, U.S. Postal Inspection Service, Frederick County Sheriff’s Office, Front Royal PD, and Strasburg PD. Assistant United States Attorney Jeb Terrien is prosecuting the case for the United States.
Man Sentenced to 5 Years in Prison for Illegally Re-Entering U.S. After Having Been DeportedRead the Press Release
ROCKFORD — A Mexican citizen was sentenced today in federal court by U.S. District Judge Philip G. Reinhard for illegally re-entering the United States after having been deported.
JAVIER GRANADOS-LEON, 48, was sentenced to 60 months in federal prison, to be followed by three years of supervised release. Granados-Leon pleaded guilty to the illegal re-entry charge on July 21, 2020.
According to a written plea agreement, Granados-Leon admitted that he illegally re-entered the U.S. after having been previously deported to his native Mexico on March 9, 2017. Granados-Leon was arrested in Oregon, Ill.
The sentencing was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Thomas Feeley, Director of the Chicago Field Office for U.S. Immigration and Customs Enforcement, Enforcement and Removal Operations. The government was represented by Assistant U.S. Attorney Michael D. Love.
Leader of Latin Kings in Massachusetts Pleads Guilty to Drug Conspiracy ChargesRead the Press Release
BOSTON – A leader of the Massachusetts Almighty Latin King and Queen Nation (Latin Kings) pleaded guilty today to drug conspiracy charges.
Bienvenido Nunez, a/k/a “King Apache,” 33, pleaded guilty to conspiracy to distribute cocaine base. U.S. Senior District Court Judge Rya W. Zobel scheduled sentencing for Feb. 11, 2021. Nunez was charged in December 2019, at which time he was identified as the Inca, or leader, of the Massachusetts Latin Kings.
Nunez admitted that he conspired with other Latin Kings members and leaders to possess cocaine base (also known as crack cocaine) with the intent to distribute it. In September 2019, Nunez conspired with others to obtain cocaine base from members of the Latin Kings in New Bedford for resale. On Sept. 29, 2019, Nunez was captured in a video recording in the basement of a Latin Kings trap house in New Bedford bagging about an amount of cocaine base for street-level distribution.
The Latin Kings are a violent criminal enterprise comprised of thousands of members across the United States. The Latin Kings adhere to a national manifesto, employ an internal judiciary and use a sophisticated system of communication to maintain the hierarchy of the organization. As alleged in court documents, the gang uses drug distribution to generate revenue, and engages in violence against witnesses and rival gangs to further its influence and to protect its turf.
In December 2019, a federal grand jury in Boston returned an indictment alleging racketeering conspiracy, drug conspiracy and firearms charges against 62 leaders, members and associates of the Latin Kings. Bienvenido Nunez is the sixteenth defendant to plead guilty in the case.
The charge of conspiring to distribute and possess with intent to distribute controlled substances provides for a sentence of up to 20 years in prison, a minimum of three years and up to life of supervised release and a fine of up to $1 million. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
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 Worcester Police Chief Steven M. Sargent made the announcement today. Valuable assistance was also provided by the FBI North Shore Gang Task Force and the Bristol County and Suffolk County District Attorney’s Offices. Assistant U.S. Attorney Philip A. Mallard and Mark Grady of Lelling’s Criminal Division are prosecuting the case.
The details contained in the charging documents are allegations. The remaining defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The operation was conducted by a multi-agency task force through the Organized Crime Drug Enforcement Task Force (OCDETF), a partnership between federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply. More information on the OCDETF program is available here: https://www.justice.gov/ocdetf/about-ocdetf.
Kissimmee Accountant Pleads Guilty to Embezzling Funds from Two Different EmployersRead the Press Release
Orlando, Florida – Kavita L. Harack (34, Kissimmee) has pleaded guilty to committing wire fraud. She faces a maximum penalty of 20 years in federal prison. A sentencing date has not yet been set.
According to the plea agreement, in approximately May 2017, Harack was hired to work as an accountant in the Orlando office of a display services company. Between April 2018 and May 2019, Harack directed 74 fraudulent payments from the display services company to four bank accounts held in her or her husband’s name. Harack disguised the transfers to these personal accounts as vendor payments. After Harack was terminated by the display services company in May 2019, she was hired to work in the accounting department of a project design company in Orlando. Between July 2019 and December 2019, Harack directed four fraudulent payments from the project design company into two of her personal accounts, again disguising the transactions as vendor payments.
In total, between 2018 and 2019, Harack fraudulently paid herself $604,637.25 from accounts belonging to her employers. Harack used the funds to purchase a home, as well as home improvement projects, travel, retail purchases, restaurants, and beauty expenses.
This case was investigated by the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney Chauncey A. Bratt.
Justice Department Announces $5.3 Million in Awards to Support Operation LegendRead the Press Release
At a roundtable with law enforcement in Indianapolis today, Attorney General William P. Barr announced that the Department of Justice’s Office of Justice Programs (OJP) is making up to $5.3 million available in grants to support Operation Legend. Eight Legend cities - Kansas City, Mo., Albuquerque, Cleveland, Detroit, Memphis, Milwaukee, St. Louis, and Indianapolis – will be eligible for up to $500,000 in grant funding to support Real Time Crime Centers, which provide police with rapid intelligence and instant information to help identify emerging crime patterns. In addition, more than $1.3 million will fund special prosecutors who have been cross-designated to try federal firearms cases originating in Albuquerque, Memphis, St. Louis, and Kansas City, Mo.
“Keeping its citizens safe is the primary responsibility of government,” said Attorney General Barr. “Cities plagued by violent crime need the resources to tackle it, and these grant awards will help do that. On the enforcement side, Real Time Crime Centers will make policing more efficient and targeted; and on the prosecution side, Special Assistant U.S. Attorneys will help bring more federal firearms cases to justice.”
Real Time Crime Centers are a considerable financial investment for any law enforcement agency. The funding being made available to each Legend city can assist police departments in purchasing critical equipment and paying for the overtime to keep these centers staffed around the clock.
Grants to the New Mexico 13th Judicial District Attorney’s Office ($278,460); Jackson County, Missouri ($247,236); Tennessee’s 30th District Attorney General’s Office ($398,864); and the Missouri Attorney General’s Office ($397,020) will allow these four Operation Legend sites to hire full-time local prosecutors who will be empowered to try firearms cases in federal court. Prosecuting gun crimes is central to the Justice Department’s strategy under Operation Legend, a sustained, systematic and coordinated initiative in which federal law enforcement agencies work in conjunction with state and local officials to fight violent crime. Funding comes from the Bureau of Justice Assistance, a component of OJP.
“We are pleased to support the outstanding work being undertaken through Operation Legend to reduce violent crime by focusing on cases involving illegal firearms,” said OJP Principal Deputy Assistant Attorney General Katharine T. Sullivan. “The Office of Justice Programs is pleased to make these resources available to support the brave crime-fighters who work so hard to deter violence and keep our communities safe.”
The Department of Justice launched Operation Legend in July, following the murder of four-year-old LeGend Taliferro, who was shot and killed while he slept in his Kansas City home. The initiative was subsequently expanded from Kansas City to Albuquerque, Chicago, Cleveland, Detroit, Memphis, Milwaukee, St. Louis, and Indianapolis. Since the summer launch, officials in Operation Legend sites have made more than 5,500 arrests, including approximately 276 for homicide, and seized more than 2,000 firearms. Of the more than 5,500 individuals arrested, approximately 1,124 have been charged with federal offenses. More than 600 of those defendants have been charged with firearms offenses.
For more information on Operation Legend, please visit https://www.justice.gov/operationlegend.
Inmate Indicted for Sending Threatening Letter to United States SenatorRead the Press Release
ALBANY, NEW YORK – Carlo Di Padova, age 61, was indicted today for sending a letter from the Auburn Correctional Facility, addressed to a United States Senator, containing a white powdery substance and a message stating that Di Padova planned to have someone shoot the Senator in the head.
The announcement was made by Acting United States Attorney Antoinette T. Bacon and Thomas F. Relford, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI).
Di Padova, now housed at the New York State Correctional Facility located in Malone, New York, is charged with mailing a threatening communication and impeding, intimidating, and interfering with a federal official by threat. The charges in the indictment are merely accusations. The defendant is presumed innocent unless and until proven guilty. The powder in the letter was determined to be an innocuous substance.
Each charge filed against Di Padova carries a maximum sentence of 10 years in prison and a fine of up to $250,000. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines, and other factors.
This case is being investigated by the FBI’s Joint Terrorism Task Force (JTTF), and the New York State Department of Correction and Community Supervision, Office of Special Investigation, and is being prosecuted by Assistant U.S. Attorney Emily C. Powers.
Indictment Charges 7 Hartford Women for Participating in Victoria's Secret Theft SchemeRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, and Michael Shea, Acting Special Agent in Charge of Homeland Security Investigations (HSI) in Boston, today announced that a federal grand jury in Hartford has returned an indictment charging DEBRAN MOORE, also known as Debran Chanel, 21; SHAMONIQUE MACKEY, 21; DAIJAH FAGAN, 20; TAMIJAH HUNTER, 21; SHARNICE JACKSON, 19; LEONNA JONES, 21; and IMANI AITCHESON, 21, all of Hartford, with conspiracy and fraud offenses related to a scheme to defraud Victoria’s Secret stores in Connecticut and Massachusetts.
The indictment was returned on October 6, 2020, and was unsealed after the defendants were arrested. Each defendant is released on a $100,000 bond.
As alleged in the indictment, beginning at least as early as February 2019 and continuing through at least October 2019, the co-conspirators devised a scheme through which they stole thousands of dollars from L Brands, the parent company of Victoria’s Secret stores. As part of the scheme, the co-conspirators shoplifted merchandise from Victoria’s Secret stores in Connecticut and Massachusetts. They then returned the shoplifted Victoria’s Secret merchandise through a “No Original Receipt” return, which allowed them to obtain gift cards for Victoria’s Secret in the value of the stolen merchandise (the “Return Step”). The co-conspirators then redeemed the gift cards at Victoria’s Secret stores for merchandise that slightly exceeded the value of the gift card, so that the excess amount was charged to a debit card connected to a co-conspirator (the “Redeem Step”). They then returned the merchandise purchased in the Redeem Step, with the refund for the entire amount credited to the co-conspirator’s debit card (the “Refund Step”).
It is alleged that the loss to L Brands from this scheme exceeds $100,000.
The indictment charges each defendant with one count of conspiracy to commit wire fraud, and one count of wire fraud. Both charges carry a maximum term of imprisonment of 20 years.
U.S. Attorney Durham stressed that a complaint is only a charge and is not evidence of guilt. Charges are only allegations and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This investigation is being conducted by the Department of Homeland Security, Homeland Security Investigations, with the assistance of the Connecticut State Police, Hartford Police Department and L Brands Loss Prevention. The case is being prosecuted by Assistant U.S. Attorney Sarala V. Nagala.
Illinois Man Charged with Defrauding the U.S Treasury Department’s Mortgage Assistance Program in IndianaRead the Press Release
HAMMOND-Mohammed Shahbaz Khan, age 45, of Bourbonnais, Illinois was indicted for making false claims in connection with his receipt of money from the Hardest Hit Fund, a federal mortgage assistance initiative offered by the U.S. Treasury Department’s Troubled Asset Relief Program, announced U.S. Attorney Kirsch.
According to the indictment, the purpose of the Hardest Hit Fund was to help stabilize communities in states, like Indiana, that were “hardest hit” by the 2008 economic and housing market downturn. The Hardest Hit Fund program in Indiana is administered by the Indiana Housing and Community Development Authority. In order to receive this mortgage assistance, an applicant was required to be an Indiana homeowner; own only one home; and reside in that home.
The indictment alleges that Khan knowingly submitted false statements about his residency in order to obtain Hardest Hit Fund mortgage assistance on an Indiana property, while living elsewhere. Over 18-months, Khan allegedly received $29,926.46 in mortgage assistance, to which he was not entitled.
“Today, an Illinois man was charged with defrauding a long-term federal economic stability program, intended to help people stay in their homes, knowing that he did not qualify,” said Christy Goldsmith Romero, Special Inspector General of the U.S. Treasury Department’s Troubled Asset Program (SIGTARP). “We commend the Office of the U.S. Attorney for the Northern District of Indiana for standing with SIGTARP to combat fraud against homeownership preservation programs.”
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 was investigated by the U.S. Department of Treasury’s Office of Special Inspector General for the Troubled Asset Relief Program (SIGTARP). This case is being prosecuted by Assistant United States Attorney Molly Kelley.
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Identity Thief Sentenced to 75 Months in Federal PrisonRead the Press Release
Benton, Ill. –Tamecia Buckley, 37, of Cahokia, Illinois, was sentenced today to 75 months in
federal prison on 7 fraud counts and 5 aggravated identity theft counts. Buckley pled guilty to the
charges in July and has been in federal custody since August 2019. She will serve a three-year term
of supervised release following her imprisonment on the fraud counts and a one-year term of
supervised release on the aggravated identity theft counts.Documents in the case reveal that for about a five-year period, Buckley used the identities of real
people, some of whom were elderly females, without their permission to purchase a car, lease
cellular telephones (which she sold for cash), and activate utility services, causing losses over
$325,000. In sentencing Buckley, United States District Judge Staci M. Yandle acknowledged the
emotional harm aggravated identity theft victims experience, stating that many people “don’t
consider how serious it is.”United States Attorney Steven D. Weinhoeft praised the investigative work of the United States
Postal Inspection Service, the Federal Bureau of Investigation, the Illinois State Police, the
Germantown Police Department, the Richmond Heights Police Department, the Fairview Heights Police
Department, and the Cahokia Police Department for their work in this investigation.U.S. Attorney Weinhoeft also acknowledged that in 2018, 14.4 million Americans became identity
theft victims. 1 This averages out to about 1 out of every 15 Americans or a new victimization
every two seconds.2 “If you believe you have been a victim of identity theft, I encourage you to
contact your local police department and submit a report,” Weinhoeft said.____________________________________________________________________________________________________________________________________________________
1 See https://www.iii.org/fact-statistic/facts-statistics-identity-theft-and-cybercrime.
2 See https://clark.com/technology/theres-a-new-victim-of-identity-theft-every-two-seconds-heres-the-best-way-to- protect-yourself-online/.Husband Sentenced to over 15 Years in Prison for Human Trafficking Convictions Related to Forced Labor of Foreign NationalsRead the Press Release
SACRAMENTO, Calif. — Following his wife’s sentencing, Satish Kartan, 46, currently residing in Sacramento, was sentenced today to 15 years and eight months in prison for forced labor violations. In addition, U.S. District Judge Morrison C. England Jr. ordered $15,657 be paid in restitution to three victims, in part to cover their back wages and other losses.
On March 14, 2019, after an 11-day trial, a federal jury found Kartan and his wife, Sharmistha Barai, 40, guilty of conspiracy to obtain forced labor and two counts of obtaining forced labor. Kartan was also found guilty of one count of fraud in foreign labor contracting. On Oct. 2, Barai was sentenced to 15 years and eight months in prison for forced labor violations.
Assistant Attorney General Eric Dreiband for the Department of Justice’s Civil Rights Division; U.S. Attorney McGregor W. Scott; Matthew Perlman, Special Agent in Charge of the U.S. Department of State’s Diplomatic Security Service (DSS), San Francisco Field Office; Sean Ragan, Special Agent in Charge of the FBI Sacramento Field Office; and Tatum King, Special Agent in Charge, Homeland Security Investigations for San Francisco and Northern California made the announcement.
“Kartan earned his sentence by the systematic abuse and exploitation of vulnerable women for the benefit of his wife and family,” said U.S. Attorney Scott. “He verbally abused multiple victims, withheld basic sustenance from them, and physically intimidated them. Today’s sentence will send a loud message to others engaged in human trafficking and labor. Moreover, it will give Kartan’s victims the peace of mind that he will never be able to abuse them again.”
“The United States abolished slavery and involuntary servitude more than 150 years ago,” said Assistant Attorney General Eric Dreiband for the Justice Department's Civil Rights Division. “Yet, inhuman forced labor and deprivations of liberty and dignity persist because human traffickers proliferate modern-day slavery, and endeavor to exploit their fellow human beings for profit and other gruesome purposes. The sentence imposed today sends a stern message that human trafficking and forced labor will not be tolerated in the United States. The defendant’s role in this scheme to compel the victims into servitude for up to 18 hours a day, with minimal pay, through intimidation, threats, and violence, is an unconscionable and illegal criminal violation of the victims’ individual rights, freedom, and dignity. The Civil Rights Division remains committed to pursuing justice relentlessly on behalf of victims of human trafficking and prosecuting perpetrators to the fullest extent of the law.”
“Those engaged in the heinous crime of forced labor will face severe consequences for their actions,” said SAC Perlman of the Diplomatic Security Service, San Francisco Field Office. “The Diplomatic Security Service and our partner agencies will continue to aggressively pursue and prosecute those who commit visa fraud to exploit others for their own personal gain.”
“Victims of labor trafficking are often unaware of how to get help and that services are available to help them after they are recovered,” said SAC Ragan of the FBI Sacramento Field Office. “The FBI is committed to working with our law enforcement partners and investigating allegations of human trafficking and to break the cycle of force, fraud, or coercion that has bound victims to their traffickers. To be successful, we need your help. Please report alleged human trafficking to law enforcement or submit a tip to tips.fbi.gov.”
“This sentencing is a success in the fight against the heinous crime of human trafficking in our region and our dedication to bring these criminals to justice,” announced Tatum King, Special Agent in Charge Homeland Security Investigations (HSI) NorCal. “We are grateful to our law enforcement partners, especially the Stockton Police Department, USDOJ’s Civil Rights Division, the U.S. Attorney’s Office, DSS, and the FBI, for their unwavering efforts not only in this investigation, but in our continued fight to disrupt and dismantle human trafficking networks worldwide. We also are appreciative of the critical work that community-based organizations provide in bringing these heinous violations to light as well as the critical resources they provide to victims to assist in their recovery.”
According to court documents and evidence presented at trial, between February 2014 and October 2016, Kartan and Barai hired workers from overseas to perform domestic labor in their home in Stockton. In advertisements seeking workers on the internet and India-based newspapers, the defendants made false claims about the wages and conditions of employment. Once the workers arrived at the defendants’ Stockton residence, Kartan and Barai compelled them to work up to 18 hours a day with limited rest and nourishment. Few of them were paid any wage. As part of the conspiracy, the couple kept the domestic workers from leaving and coerced them to continue working by threatening them, by creating an atmosphere of fear, control, and disempowerment, and at times by physically hitting or burning them. When a victim resisted or expressed a desire to leave, the threats and abuse became worse.
This case was the product of an investigation by Homeland Security Investigations (HSI), the FBI, and the State Department’s Diplomatic Security Service. The Stockton Police Department provided the initial investigation and later assistance with victim services. Assistant U.S. Attorneys Jason Hitt and Katherine Lydon prosecuted the case with the assistance of the Civil Rights Division’s Human Trafficking Prosecution Unit.
The Eastern District of California (Sacramento) is one of six districts designated through a competitive, nationwide selection process as a Phase II Anti-Trafficking Coordination Team, through the interagency ACTeam Initiative of the Departments of Justice, Homeland Security and Labor. ACTeams focus on developing high-impact human trafficking investigations and prosecutions involving forced labor, international sex trafficking and sex trafficking by force, fraud or coercion through interagency collaboration among federal prosecutors and federal investigative agencies.
Husband Sentenced to 188 Months in Prison for Human Trafficking Convictions Related to Forced Labor of Foreign NationalsRead the Press Release
The Justice Department today announced that former Stockton, California resident Satish Kartan, 46, was sentenced today to 188 months in prison for forced labor violations. In addition, U.S. District Judge Morrison C. England Jr. ordered $15,657 be paid in restitution to three victims, in part to cover their back wages and other losses.
On March 14, 2019, after an 11-day trial, a federal jury found Kartan and his wife, Sharmistha Barai, 40, guilty of conspiracy to obtain forced labor and two counts of obtaining forced labor. Kartan was also found guilty of one count of fraud in foreign labor contracting. On Oct. 2, Barai was sentenced to 15 years and eight months in prison for forced labor violations.
“The United States abolished slavery and involuntary servitude more than 150 years ago,” said Assistant Attorney General Eric Dreiband for the Justice Department's Civil Rights Division. “Yet, inhuman forced labor and deprivations of liberty and dignity persist because human traffickers proliferate modern-day slavery, and endeavor to exploit their fellow human beings for profit and other gruesome purposes. The sentence imposed today sends a stern message that human trafficking and forced labor will not be tolerated in the United States. The defendant’s role in this scheme to compel the victims into servitude for up to 18 hours a day, with minimal pay, through intimidation, threats, and violence, is an unconscionable and illegal criminal violation of the victims’ individual rights, freedom, and dignity. The Civil Rights Division remains committed to pursuing justice relentlessly on behalf of victims of human trafficking and prosecuting perpetrators to the fullest extent of the law.”
“Kartan earned his sentence by the systematic abuse and exploitation of vulnerable women for the benefit of his wife and family,” said U.S. Attorney McGregor W. Scott for the Eastern District of California. “He verbally abused multiple victims, withheld basic sustenance from them, and physically intimidated them. Today’s sentence will send a loud message to others engaged in human trafficking and labor. Moreover, it will give Kartan’s victims the peace of mind that he will never be able to abuse them again.”
“Those engaged in the heinous crime of forced labor will face severe consequences for their actions,” said Matthew Perlman, Special Agent in Charge (SAC) of the U.S. Department of State’s Diplomatic Security Service (DSS), San Francisco Field Office. “The Diplomatic Security Service and our partner agencies will continue to aggressively pursue and prosecute those who commit visa fraud to exploit others for their own personal gain.”
“Victims of labor trafficking are often unaware of how to get help and that services are available to help them after they are recovered,” said SAC Sean Ragan of the FBI Sacramento Field Office. “The FBI is committed to working with our law enforcement partners and investigating allegations of human trafficking and to break the cycle of force, fraud, or coercion that has bound victims to their traffickers. To be successful, we need your help. Please report alleged human trafficking to law enforcement or submit a tip to tips.fbi.gov.”
“This sentencing is a success in the fight against the heinous crime of human trafficking in our region and our dedication to bring these criminals to justice,” said Tatum King, SAC, Homeland Security Investigations (HSI) for San Francisco and Northern California. “We are grateful to our law enforcement partners, especially the Stockton Police Department, Justice Department's Civil Rights Division, the U.S. Attorney’s Office, DSS, and the FBI, for their unwavering efforts not only in this investigation, but in our continued fight to disrupt and dismantle human trafficking networks worldwide. We also are appreciative of the critical work that community-based organizations provide in bringing these heinous violations to light as well as the critical resources they provide to victims to assist in their recovery.”
According to court documents and evidence presented at trial, between February 2014 and October 2016, Kartan and Barai hired workers from overseas to perform domestic labor in their home in Stockton. In advertisements seeking workers on the internet and India-based newspapers, the defendants made false claims about the wages and conditions of employment. Once the workers arrived at the defendants’ Stockton residence, Kartan and Barai compelled them to work up to 18 hours a day with limited rest and nourishment. Few of them were paid any wage. As part of the conspiracy, the couple kept the domestic workers from leaving and coerced them to continue working by threatening them, by creating an atmosphere of fear, control, and disempowerment, and at times by physically hitting or burning them. When a victim resisted or expressed a desire to leave, the threats and abuse became worse.
This case was the product of an investigation by HSI, the FBI, and DSS. The Stockton Police Department provided the initial investigation and later assistance with victim services. Assistant U.S. Attorneys Jason Hitt and Katherine Lydon prosecuted the case with the assistance of the Civil Rights Division’s Human Trafficking Prosecution Unit.
The Eastern District of California (Sacramento) is one of six districts designated through a competitive, nationwide selection process as a Phase II Anti-Trafficking Coordination Team, through the interagency ACTeam Initiative of the Departments of Justice, Homeland Security and Labor. ACTeams focus on developing high-impact human trafficking investigations and prosecutions involving forced labor, international sex trafficking and sex trafficking by force, fraud or coercion through interagency collaboration among federal prosecutors and federal investigative agencies.
Houston Woman Sentenced to 5 Years in Federal Prison for Role in Opioid Pill Mill that Shipped Narcotics from California to TexasRead the Press Release
LOS ANGELES – A Texas woman was sentenced today to 60 months in federal prison for her leading role in an opioid buy-back scheme in which a doctor at a Los Angeles clinic prescribed opioids to “patients” who sold the narcotics back to the clinic, which later sold drugs on the black market in California and Texas.
Angela Gillespie-Shelton, a.k.a. “Boss Lady,” and “Angotti,” 54, of Houston, was sentenced by United States District Judge John A. Kronstadt, who also ordered her to pay a $10,000 fine. Gillespie-Shelton pleaded guilty on May 21 to one count of conspiracy to distribute controlled substances and one count of conspiracy to engage in money laundering.
From October 2012 to January 2015, Gillespie-Shelton and her co-conspirators ran Southfork Medical Clinic, located in the Harvard Heights neighborhood of Los Angeles. At the time, Gillespie-Shelton primarily was based in Texas, but she frequently traveled to California.
The conspiracy’s purpose was to sell prescriptions for narcotics in exchange for cash, and to later acquire those same drugs from the clinic’s “patients,” ship the narcotics to Texas and then sell them on the black market. The prescriptions were for drugs including oxycodone and hydrocodone (commonly sold under the brand names Vicodin, Norco and Lortab), alprazolam (best known by the brand name Xanax), carisoprodol (a muscle relaxant sold under the brand name Soma) and promethazine with codeine (a cough syrup sold on the street as “purple drank” and “sizzurp”).
At the clinic, Gillespie-Shelton’s co-conspirator – Dr. Madhu Garg, 69, of Glendora – saw “patients” and regularly prescribed them the narcotics, when both Gillespie-Shelton and Garg knew that the customers did not have any actual or legitimate medical need for them.
After the “patients” filled the prescriptions, Gillespie-Shelton and her co-conspirators bought the drugs from them and shipped the drugs to Texas.
In Texas, Gillespie-Shelton used two pharmacies that she controlled as a front to sell on the black market the drugs shipped from the Los Angeles clinic. Under Gillespie-Shelton’s control, the pharmacies in Texas also filled false or fraudulent prescriptions and received kickbacks from the fake prescriptions. Gillespie-Shelton’s co-conspirators also stole a physician’s identity to issue falsified prescriptions to obtain additional narcotics.
In addition, Gillespie-Shelton laundered more than $1 million from the diversion schemes through numerous accounts. She used some of the money to further the narcotics trafficking conspiracy, which included paying rent for the Southfork Clinic and a stash house in Los Angeles, as well as paying Garg more than $200,000 for writing the illegal prescriptions.
In February 2016, Garg pleaded guilty to illegally distributing oxycodone and money laundering, and she later served an 18-month prison sentence.
“[Gillespie-Shelton and her co-conspirators] made hundreds of thousands of dollars profiting off the Opioid Crisis,” prosecutors wrote in their sentencing memorandum. “The sheer amount of money [they] made over the course of this conspiracy shows that this was a crime borne of greed where the criminals trafficked lethal drugs despite the undeniable havoc they wreaked on their community.”
The case against Gillespie-Shelton was investigated by the Drug Enforcement Administration, IRS Criminal Investigation, the Los Angeles Police Department, the Los Angeles County Sheriff’s Department, the California Department of Justice, and the Texas Department of Public Safety. This investigation was conducted with the support of the Organized Crime Drug Enforcement Task Force.
This matter was prosecuted by Assistant United States Attorney Chelsea Norell of the International Narcotics, Money Laundering, and Racketeering Section.
Houston Man Sentenced to Federal Prison on Drug Trafficking ChargesRead the Press Release
LAFAYETTE, La. – A Houston, Texas man was sentenced today by United States District Judge Robert R. Summerhays to 42 months (3 years, 6 months) in prison followed by 4 years of supervised release for his role in smuggling cocaine to the Opelousas and Eunice areas.
Kevin Robertson, 53, was charged in a June 19, 2019 indictment with conspiracy to possess with intent to distribute cocaine. Robertson pled guilty to the charge on December 9, 2019.
Louisiana State Police Troopers conducted a traffic stop of the vehicle that Robertson was driving on Interstate 20 near Lake Charles on April 20, 2019. According to information presented to the court, law enforcement officers conducted a search of Robertson’s vehicle and found seven ounces of crack cocaine, one kilogram of cocaine, and other controlled substances, and he was arrested.
This prosecution is part of a larger investigation conducted by the Drug Enforcement Administration through its Southwest Louisiana HIDTA Task Force and Organized Crime and Drug Enforcement Task Forces. The Louisiana State Police Narcotics Division initiated the investigation, and Special Agents with DEA, as well as Task Force Officers assigned to the Southwest Louisiana HIDTA Task Force, completed the investigation. In addition to the above conviction and sentence, the investigation resulted in the dismantling of a drug trafficking organization in Ville Platte, Louisiana. Assistant U.S. Attorney Robert C. Abendroth prosecuted the case.
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Head of Merchant Bank Pleads Guilty in Connection with Multimillion-Dollar Securities Fraud SchemeRead the Press Release
Audrey Strauss, the Acting United States Attorney for the Southern District of New York, announced today that CRAIG ZABALA, the chairman, chief executive officer, and president of Concorde Group Holdings Inc. (“Holdings”), pled guilty before U.S. District Judge J. Paul Oetken to conspiracy to commit securities fraud and wire fraud stemming from a scheme to defraud investors in Holdings, a purported merchant banking firm. Among other illicit activity, ZABALA fraudulently induced at least 17 investors to invest at least approximately $4.38 million based on false and misleading statements, by failing to use investors’ funds as promised, including to build Holdings’ purported business by investing in and buying other financial services companies, and by converting investors’ money to his own use, including to repay other investors in a Ponzi-like fashion.
Acting U.S. Attorney Audrey Strauss said: “Craig Zabala admitted in court that he defrauded investors of more than $4 million through a purported financial services firm he controlled. Zabala lied to investors about how much money had been raised, who had invested, how close the firm was to an IPO, and how he would use investors’ money – most of which he took for his own use or to pay off investors in Ponzi-like fashion.”
According to the allegations in the Complaint, the Information filed today, and other proceedings in this case:
CRAIG ZABALA was the chairman, CEO, and president of various affiliated and intertwined purported financial services companies: Holdings, Concorde Group, Inc. (“Group”), Blackhawk Capital Group BDC, Inc. (“Blackhawk”), DBL Holdings, LLC, d/b/a “Drexel Burnham Lambert” (“DBL”), Concorde Investment Managers, LLC (“CIM”), and Concorde Europe, Ltd. (“Concorde Europe”). In or about August 2019, FINRA barred ZABALA from the broker-dealer industry, including because of his failure to cooperate with a FINRA investigation.
Holdings was a Delaware corporation formed in or about 2015, with an office in Jersey City, New Jersey, and a mailing address in New York, New York. Holdings purported to provide financial services, including merchant banking, investment banking, asset management, and securities brokerage services, to entrepreneurs, investors, and businesses in the middle market, meaning small to mid-sized companies with revenue and market capitalizations of less than $1 billion, in North America, Europe, and Asia. Holdings’ purported affiliates included Group, DBL, Blackhawk, CIM, and Concorde Europe. ZABALA was a majority owner of Holdings.
Group was a Delaware corporation formed in or about 1995, based in New York, New York, that purported to provide the same types of financial services as Holdings. Group’s purported affiliates included DBL, Blackhawk, CIM, and Concorde Europe. ZABALA was a majority owner of Group. Between in or about 2001 and in or about 2014, Group purportedly raised approximately $18 million from investors.
From at least in or about 2015 through in or about 2020, ZABALA and others perpetrated a scheme to defraud at least approximately 17 investors out of at least approximately $4.38 million in Holdings notes, warrants, and equity, almost all of whom invested in a private offering by Holdings of $25 million in senior secured notes with attached warrants paying 13 percent interest (the “Holdings Offering”).
ZABALA and others falsely represented that the proceeds from the offerings would be used to grow Holdings’ purported business by investing in and buying other financial services companies. In truth and in fact, and as ZABALA well knew, Holdings did not make any investments in or buy other companies.
ZABALA and others falsely represented to Holdings investors that Holdings had raised nearly $25 million in the Holdings Offering. In truth and in fact, and as ZABALA well knew, Holdings only raised a few million dollars.
ZABALA and others falsely represented to Holdings investors that the family office of a wealthy German family had invested millions of dollars in Holdings. In truth and in fact, and as ZABALA well knew, this family office never invested in, and never committed to invest in, Holdings.
ZABALA and others falsely represented to Holdings Investors that Holdings would soon have an initial public offering (“IPO”), which would result in large profits to Holdings investors. In truth and in fact, and as ZABALA well knew, Holdings was not close to an IPO.
ZABALA converted at least approximately 70 percent of the approximately $4.38 million in Holdings investor funds in the form of cash withdrawals and other transfers to himself, payments to his girlfriend, payments of his personal credit card bills, and repayment of Group investors in a Ponzi-like fashion.
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ZABALA, 68, pled guilty to one count of conspiracy to commit securities fraud and wire fraud, which carries a maximum sentence of five years in prison. The charge also carries a maximum fine of $250,000, or twice the gross gain or loss from the offenses. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. ZABALA also agreed to forfeit $4,380,000 and to pay restitution in the amount of $4,380,000. ZABALA is scheduled to be sentenced by Judge Oetken on February 5, 2021 at 11:00 a.m.
Ms. Strauss praised the outstanding work of the United States Postal Inspection Service’s New York Division, and also thanked the SEC and Financial Industry Regulatory Authority for their assistance and cooperation in this investigation.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant United States Attorney Joshua A. Naftalis is in charge of the prosecution.
Guilty Verdict in First MDGA Jury Trial Since COVID-19 Precautions BeganRead the Press Release
COLUMBUS, Ga. – A federal jury has returned a guilty verdict in the first convened jury trial in the Middle District of Georgia since COVID-19 precautions took effect, said Charlie Peeler, the U.S. Attorney for the Middle District of Georgia.
Ernesto Rivera-Rodriguez, 55, of Cataula, Harris County, Georgia, was found guilty of one count of transmitting threats in interstate commerce. His trial, which began on Monday, October 19 before U.S. District Judge Clay Land, concluded with a guilty verdict today. Rivera-Rodriguez faces a maximum five years in prison. A sentencing date has not been set. There is no parole in the federal system.
As the trial was to take place during the COVID-19 pandemic, the Court developed a plan to protect USAO personnel, defense counsel, the defendant, witnesses, jurors and court personnel by requiring the use of masks, spreading individuals out within the courtroom and diligently sanitizing all areas. In addition, witnesses wore clear masks and plexiglass barriers were used. Jurors were seated in the gallery in order to remain at safe distances, and witnesses sat socially distanced in the jury box. Jury selection was conducted in two groups, as opposed to the usual one gathering, to ensure people were socially distanced and safe.
“There were many precautions put in place to ensure that both a safe and a fair trial was conducted here in the Middle District of Georgia,” said U.S. Attorney Peeler. “This guilty verdict holds the defendant accountable for terrorizing the hard-working employees of the timeshare company and the hard-working men and women of the Polk County Sheriff’s Office. Our office will vigorously prosecute those who choose to threaten others while hiding behind a telephone or a computer. I want to thank all involved for ensuring justice was served today.”
According to facts entered into court, Rivera-Rodriguez was vacationing at a timeshare property he owned in Orlando, Florida in November 2017, when he was arrested by Polk County, Florida deputies for misdemeanor possession of marijuana, to which he pled guilty. Rivera-Rodriguez, a former Marine, then threatened to kill the police officers involved in his arrest. Shortly after his arrest, Rivera-Rodriguez became involved in a dispute with the timeshare company and again made multiple threats, including stating that he would take an AR-15 to the timeshare and kill employees if he was not refunded $75,000. In one of multiple, legally recorded threats, Rivera-Rodriguez told a timeshare employee, “Please don’t make me go over there and start spilling blood over there in Orlando, because I will take it out on the people over there.” Rivera-Rodriguez added, “I will go to Florida and take it out on someone over there, and if that cop shows up, I’m taking his (profanity) head off, too.” The FBI spoke with Rivera-Rodriguez on numerous occasions, but he refused to stop making the threats. Ultimately, Rivera-Rodriguez was indicted and detained. According to a family member, Rivera-Rodriguez had a concealed weapon permit and “was always armed.”
The case was investigated by FBI and the Polk County, Florida Sheriff’s Office. Assistant U.S. Attorney Mel Hyde is prosecuting the case for the Government. Questions can be directed to Pamela Lightsey, Public Information Officer, United States Attorney’s Office, at (478) 621-2603 or Melissa Hodges, Public Affairs Director (Contractor), United States Attorney’s Office, at (478) 765-2362.
Guild Mortgage Company of San Diego to Pay Almost $25 Million to Resolve Allegations it Knowingly Caused False ClaimsRead the Press Release
Assistant U. S. Attorney Joseph Price (619) 546-7642
NEWS RELEASE SUMMARY – October 22, 2020
SAN DIEGO – Guild Mortgage Company has agreed to pay the United States $24.9 million to resolve allegations that it violated the False Claims Act and the common law by knowingly breaching material program requirements when it originated and underwrote mortgages insured by the Department of Housing and Urban Development’s (HUD) Federal Housing Administration (FHA), the Department of Justice announced today. Guild Mortgage Company is headquartered in San Diego, California, with branches across the United States.
“Ensuring the integrity of federal lending programs is important to keeping those programs financially sound,” said Acting Assistant Attorney General Jeffrey Bossert Clark of the Department of Justice’s Civil Division. “Together, with our partners at HUD, we have worked hard to hold accountable FHA lenders that knowingly and materially violate program requirements that help Americans achieve the dream of home ownership.”
“As this settlement demonstrates, we are committed to holding mortgage lenders accountable when they choose to abuse the integrity of vital government programs that are designed to assist homeownership,” said U.S. Attorney Robert Brewer. “We also commend the whistleblower for coming forward, exposing these wrongs, and working with the government investigative team.”
“The United States is committed to providing Americans opportunities to own their own homes,” said Acting U.S. Attorney for the District of Columbia Michael R. Sherwin. “This settlement reflects the diligent work of officials from the Department of Justice and HUD to ensure that the programs that provide those opportunities are operated with integrity and in accordance with requirements established by law.”
“The Federal Housing Administration insurance program is a critical tool that helps hardworking Americans achieve their dream of homeownership. Any abuse of that program is unacceptable and the bad actors will be held accountable,” said Rae Oliver Davis, U.S. Department of Housing and Urban Development, Inspector General. “This case highlights the effectiveness and the importance of whistleblower programs.”
Participants in the FHA mortgage insurance program, like Guild Mortgage Company, can originate and underwrite mortgages without first having the government review the loans for compliance with the agency’s underwriting and origination requirements. If an FHA-insured loan defaults, the holder of the loan can then recover from the United States for certain losses. Lenders must follow FHA rules designed to ensure that only mortgages that meet key credit and underwriting criteria are insured by the government.
The settlement announced today resolves allegations that Guild Mortgage Company knowingly approved ineligible loans that later defaulted and resulted in claims to FHA for mortgage insurance, failed to comply with material program rules that require lenders to maintain quality control programs to prevent and correct underwriting deficiencies, and failed to self-report materially deficient loans that it identified.
The agreement resolves allegations brought by the former head of quality control at Guild Mortgage Company, Kevin Dougherty, under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government for false claims and to receive a share of any recovery. The Act permits the United States to intervene in such a lawsuit, as it did in part here. Dougherty will receive $4,980,000 as his share of the government’s recovery.
The investigation, litigation, and settlement were the result of a coordinated effort among the Commercial Litigation Branch of the Department of Justice’s Civil Division, the U.S. Attorney’s Offices for the District of Columbia and the Southern District of California, HUD, and HUD-OIG.
The qui tam case is captioned United States ex rel. Dougherty v. Guild Mortgage Company, Civ. A. No. 16-2909 (S.D. Cal.).
The claims asserted against the defendant are allegations only, and there has been no determination of liability.
Grand Jury Returns 6 IndictmentsRead the Press Release
MADISON, WIS. -- A federal grand jury in the Western District of Wisconsin, sitting in Madison, has returned the following indictments. You are advised that a charge is merely an accusation and that a defendant is presumed innocent until and unless proven guilty.
Columbus Man Charged with Defrauding Financial Institution
Michael Eisenga, 49, Columbus, Wisconsin, is charged with engaging in a scheme to defraud Alliant Credit Union, a financial institution in Rolling Meadows, Illinois from August 2016 to January 2019. The indictment alleges that Eisenga, as the operator of CCC Lot 2, a limited liability company with a principal place of business in Columbus, made a false statement in an application for a mortgage loan from Alliant Credit Union for commercial property in Columbus.
The indictment alleges that Eisenga represented to Alliant that CCC Lot 2 had secured Festival Foods Inc. as a tenant for the property through a 20-year lease agreement and that another company, Supervalue Holdings, Inc., had guaranteed the lease. The indictment alleges that Eisenga provided Alliant with two signed documents he represented to be the lease with Festival Foods Inc. and the guarantee from Supervalue Holdings, Inc., but that neither of these documents were genuine. Alliant approved CCC Lot 2 for the loan and paid out loan proceeds of approximately $6.9 million in March 2018.
The indictment further alleges that as part of the scheme to defraud, after CCC Lot 2 defaulted on the loan, Eisenga provided Alliant with a document purporting to be an agreement terminating CCC Lot 2’s lease with Festival Foods Inc., but the document was not genuine.
If convicted, Eisenga faces a maximum penalty of 30 years in federal prison. The charge against him is the result of an investigation by the Federal Bureau of Investigation. Assistant U.S. Attorney Meredith Duchemin is handling the prosecution.
Man Charged with Defrauding Defense Department, Identity Theft & Money Laundering
Craig Klund, 57, Yankton, South Dakota, formerly of Chippewa Falls, Wisconsin, is charged in a 19-count indictment with a scheme to defraud the U.S. Department of Defense (DoD). The indictment alleges that Klund obtained money from DoD contracts under false pretenses by shielding his true identity from the DoD, and not disclosing the fact that he was the person bidding and winning DoD contracts. The indictment charges Klund with 10 counts of wire fraud, three counts of false statements, two counts of identity theft, and four counts of money laundering. The indictment alleges that:
- Klund created fake identities and formed multiple shell companies that listed fake addresses and fake contact persons in an effort to hide his identity, and that he attempted to engage in bid rigging by using his various shell corporations to bid on the same defense contracts in an effort to make it look like the DoD was receiving multiple competitive bids from different defense contractors, when in fact, the bids were coming from Klund;
- Klund supplied nonconforming parts to the DoD, which were being used in important military applications;
- Klund failed to deliver parts that he contracted with DoD to provide, but submitted invoices to DoD seeking payment for parts that were never shipped;
- Klund lied to various DoD inspectors about his true identity;
- Klund used, without lawful authority, a means of identification of real persons in an effort to hide his identity as the person who was actually running his shell companies;
- Klund created shell companies after two of his other companies were disbarred from participating in the U.S. government procurement program in 2015;
- In 2018, Klund relocated his business operations from Chippewa Falls to South Dakota in an effort to conceal and evade his criminal activity from the DoD;
- Klund took steps to conceal his criminal activity from the U.S. government by not reporting any of his DoD gross receipts to the IRS; and
- Klund engaged in money laundering as a way to disguise his receipt and control of the DoD proceeds paid to his shell companies.
The indictment alleges that Klund used at least 10 different shell companies and was awarded government contracts valued at over $4,000,000 from 2013 to 2018.
If convicted, Klund faces a maximum penalty of 20 years in federal on each wire fraud charge, five years on each false statement charge, 10 years on each money laundering charge, and a mandatory minimum of two years on each identity theft charge. Federal law requires that a sentence imposed on the identity theft charges be served consecutive to any other sentence imposed.
The charges against Klund are the result of an investigation by the U.S. Department of Defense, Office of Inspector General, Defense Criminal Investigation Service; U.S. Air Force, Office of Special Investigations; U.S. Army, Criminal Investigation Division, Major Procurement Fraud Unit; U.S. Naval Criminal Investigative Service; U.S. General Services Administration, Office of Inspector General, Office of Investigations; and IRS Criminal Investigation. Assistant U.S. Attorney Daniel Graber is handling the prosecution.
Minnesota Man Charged with Violating Endangered Species Act
Chang Xiong, 46, Oakdale, Minnesota, is charged with three counts of purchasing wildlife knowing that it had been transported in violation of the Endangered Species Act. The indictment alleges that in July 2016, September 2017, and December 2018, Xiong purchased rhinoceros feet.
If convicted, Xiong faces a maximum penalty of five years in federal prison on each count. The charges against him are the result of an investigation by the U.S. Fish and Wildlife Service, Office of Law Enforcement. Assistant U.S. Attorney Daniel Graber is handling the prosecution.
McFarland Woman Charged with Drug Crimes Involving Methamphetamine
Tara Blum, 29, McFarland, Wisconsin, is charged with four counts of distributing methamphetamine and two counts of possessing methamphetamine with intent to distribute. The indictment alleges that these offenses occurred between July 22 and September 9, 2020. The indictment alleges that one of the distributions involved 50 grams or more of methamphetamine, and that on September 9, Blum possessed 500 grams or more for distribution.
If convicted, Blum faces a maximum penalty of 20 years in federal prison on three of the distribution charges, a mandatory minimum of five years and a maximum of 40 on the charge involving 50 grams or more of methamphetamine, and a mandatory minimum of 10 years and a maximum of life on the charge involving 500 grams or more. The charges against Blum are the result of an investigation by the Dane County Narcotics Task Force. Assistant U.S. Attorney Robert Anderson is handling the prosecution.
Madison Man Charged with Possessing Crack Cocaine for Distribution
DeAndre Bishop, 42, Madison, Wisconsin, is charged with possessing 28 grams or more of crack cocaine with the intent to distribute. The indictment alleges that he possessed the crack cocaine on August 3, 2020.
If convicted, Bishop faces a mandatory minimum penalty of five years and a maximum of 40 years in federal prison. The charge against him is the result of an investigation by the Waunakee Police Department. Assistant U.S. Attorney David Reinhard is handling the prosecution.
Rhinelander Man Charged with Being a Felon in Possession of Ammunition
Dustin LaPuma, 26, Rhinelander, Wisconsin, is charged with being a felon in possession of ammunition. The indictment alleges that he possessed 9mm ammunition on August 10, 2020.
If convicted, LaPuma faces a maximum penalty of 10 years in federal prison. The charge against him is the result of an investigation by the Oneida County Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Chadwick Elgersma is handling the prosecution.