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9 December 2020
Utica Man Arrested for Distributing MDMA, Methamphetamine, and XanaxRead the Press Release
SYRACUSE, NEW YORK – Ryan Orts, age 31, of Utica, New York, appeared today in federal court on an indictment charging him with distributing ecstasy (MDMA), methamphetamine, and Xanax, announced Acting United States Attorney Antoinette T. Bacon and Kevin Kelly, Special Agent in Charge of the Buffalo Field Office of Homeland Security Investigations (HSI).
The charge filed against Orts carries a maximum sentence of 20 years in prison, a fine of up to $1,000,000, and a term of supervised release of at least three years and up to life. 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.
Orts was arraigned today before United States Magistrate Judge Andrew T. Baxter, and released pending trial before Chief United States District Court Judge Glenn T. Suddaby.
The charges in the indictment are merely accusations. The defendant is presumed innocent unless and until proven guilty.
This case is being investigated by Homeland Security Investigations, the United States Postal Inspection Service, and the New York State Police, and is being prosecuted by Assistant U.S. Attorney Andrew D. Beaty.
U.S. Attorney to Join Federal, State, and Local Law Enforcement Officers for a Press Conference Tomorrow, December 10, in Columbia at 2:00 p.m.Read the Press Release
Columbia, South Carolina --- United States Attorney Peter M. McCoy, Jr. announced today that a press conference will be held tomorrow, December 10, 2020, at 2:00 p.m., at the South Carolina Department of Corrections Headquarters, located at 4444 Broad River Road, Columbia, SC 29210.
Represented at the press conference will be the U.S. Attorney’s Office for the District of South Carolina; Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF); Federal Bureau of Investigation (FBI); South Carolina Department of Corrections (SCDC); South Carolina Law Enforcement Division (SLED); Anderson County Sheriff’s Office; Cherokee County Sheriff’s Office; Greenville County Sheriff’s Office; Laurens County Sheriff’s Office; Lexington County Sheriff’s Department; and Richland County Sheriff’s Department.
WHEN: Tomorrow, Thursday, December 10, 2020, 2:00 p.m.
WHERE: South Carolina Department of Corrections Headquarters
4444 Broad River Road
Columbia, SC 29210
NOTES: Press inquiries regarding logistics should be directed to Derek A. Shoemake, 843-813-0982.
Members of the media wishing to attend the remarks should gather in the SCDC Recruiting Office parking lot (also located at 4444 Broad River Road) at 1:30 p.m., 30 minutes in advance of the press conference.
Additionally, due to security protocols at the location, while not required to attend, it is asked that each outlet provide name(s) of the journalists coming to the press conference by 11:00 a.m. EST tomorrow, Thursday, December 10, by email to [email protected].
U.S. Attorney Dunavant Announces Appointment of ADA Lance Webb as Special Assistant U.S. AttorneyRead the Press Release
Jackson, TN – U.S. Attorney D. Michael Dunavant is pleased to announce that Assistant District Attorney Lance Webb has been appointed as a new Special Assistant U.S. Attorney (SAUSA) in the Jackson Branch Office. Thanks to an agreement with 29th Judicial District Attorney General Danny Goodman, ADA Lance Webb will now serve as a SAUSA in the Jackson office on a part-time basis, and will be cross-designated and dedicated to the prosecution of federal offenses originating and occurring in Dyer and Lake counties, in the 29th Judicial District of Tennessee.
General Webb has served as an Assistant District Attorney General in the 29th Judicial District since 2001, and has handled and successfully prosecuted all types of state criminal offenses, from misdemeanors to capital cases. Prior to joining the District Attorney’s Office, Lance served as Associate General Counsel for the Tennessee Department of Children’s Services from 2000-2001, and prior to that, he was engaged in the private practice of law at Fowler, Prince & Webb in Union City, Tennessee.
General Webb obtained his Doctor of Jurisprudence at the University of Tennessee College of Law in 1992, and his Bachelor of Arts Degree in History from Middle Tennessee State University in 1989. Lance and his family live in Dyersburg, where he is active in the community and his church.
U.S. Attorney D. Michael Dunavant said, “We are very excited to have Lance join our office, and I am thankful to District Attorney General Goodman for his commitment to this SAUSA position. With his many years of distinguished service and successful experience as a state prosecutor, Lance will be immediately effective and productive in furthering the mission of the Department of Justice in Dyer and Lake counties. The U.S. Attorney’s Office is committed to providing full service in all counties of West Tennessee, and General Webb’s knowledge of the public safety issues in the 29th Judicial District and his good relationship with local law enforcement will be key in our collective efforts to combat violent crime, gang activity, and drug trafficking in Northwest Tennessee.”
District Attorney General Danny Goodman said, “I am excited that the 29th Judicial District has been allowed to partner with the United States Attorney’s Office and want to thank U.S. Attorney D. Michael Dunavant for giving us this enormous opportunity. This will place Dyer and Lake Counties in the unique position of having the authority to evaluate and prosecute cases on both the State and Federal level. This partnership will be an important tool to be used in our judicial district to combat crime and continue our commitment to make our communities safe.”
U.S. Attorney Dunavant Announces Appointment of ADA Lance Webb as Special Assistant U.S. Attorney###
Two Plead Guilty to Federal Drug CrimesRead the Press Release
CHARLESTON, W.Va. – United States Attorney Mike Stuart announced today that Larry Terrence Martin, 31, of St. Albans, and Sammy Joe Fragale, Sr., 72, of Montgomery, pled guilty to conspiracy to distribute methamphetamine. Martin and Fragale are two of the 14 defendants charged as a result of a long-term investigation known as “Second Wave,” which dismantled a poly-drug network operating in Kanawha and Fayette counties.
“The Second Wave investigation put more than a dozen drug dealers out of business,” said United States Attorney Mike Stuart. “I commend the valiant efforts of the many law enforcement agencies involved in the investigation. It’s a good day for West Virginia families when we get poison peddlers like Martin and Fragale off of our streets.”
Martin admitted selling methamphetamine, marijuana, and “vape” cartridges containing THC in and around Kanawha County since at least January 2018. The investigation revealed that Martin obtained drugs from out-of-state sources who shipped the drugs to West Virginia by U.S. Mail and private parcel carriers. Martin admitted that on January 26, 2018, he intended to take possession of a package containing 6.75 pounds of methamphetamine that had been delivered to his sister, Brandi Martin’s residence in Dunbar. Police intercepted the package shortly after it was delivered. Brandi Martin eventually pled guilty to her role in that offense and was sentenced in August 2020 to 188 months in federal prison. Martin further admitted that he had recruited a local U.S. Postal Service mail carrier, identified in the indictment as Steven Matthew Bumpus, to deliver certain drug packages to him that had been addressed to locations along Bumpus’ mail route. On June 22, 2020, Bumpus delivered a package containing approximately 13 pounds of marijuana to Martin near Belle. In his plea agreement, Martin acknowledged having distributed more than 10 pounds of methamphetamine and between 40 and 60 pounds of marijuana. Martin faces 10 years and up to life in prison when he is sentenced on March 29, 2021.
Fragale admitted conspiring with his son, Sammy Joe Fragale, II to distribute methamphetamine in Montgomery and in St. Albans. On August 18 and 21, 2020, Fragale distributed methamphetamine to an informant working for the Drug Enforcement Administration. He faces up to 20 years when sentenced on March 29, 2021.
The United States Postal Inspection Service (USPIS), the Metropolitan Drug Enforcement Network Team (MDENT), the Drug Enforcement Administration (DEA), the Central West Virginia Drug Task Force, the Federal Bureau of Investigation (FBI), and the Charleston Police Department conducted the investigation. Senior United States District Judge David A. Faber presided over the hearings. Assistant United States Attorney Joshua Hanks is handling the prosecution.
The Organized Crime Drug Enforcement Task Force (OCDETF) is an independent component of the U.S. Department of Justice. Established in 1982, OCDETF is the keystone of the Attorney General’s strategy to reduce the availability of illicit narcotics throughout the United States using a prosecutor-led, multi-agency approach to combat transnational organized crime. OCDETF agents and prosecutors nationwide handle complex investigations and prosecutions of the highest-level drug traffickers, money launderers, and other priority transnational criminal organizations that threaten the citizens of the United States. OCDETF facilitates joint operations by focusing its partner agencies on priority targets, by managing and coordinating multi-agency efforts, and by leveraging intelligence across multiple investigative platforms.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case Nos. 2:20-cr-00154 (Martin) and 2:20-cr-00184 (Fragale).
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Two Plead Guilty & Are Sentenced for Wausau Methamphetamine ConspiracyRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that two individuals pleaded guilty and were sentenced this week in connection with a methamphetamine conspiracy in Wausau, Wisconsin. Chou Xiong, 37, Wausau, pleaded guilty and was sentenced yesterday by U.S. District Judge James D. Peterson to 6 ½ years in federal prison for conspiring to distribute methamphetamine. Soua Khang, 24, Wisconsin Rapids, Wisconsin, pleaded guilty and was sentenced today by Judge Peterson to 7 years in federal prison for conspiring to distribute methamphetamine.
Chou Xiong and Soua Khang conspired to distribute methamphetamine as part of a large methamphetamine trafficking operation that existed from at least November 2018 through June 2019 in the Wausau area. Lisa Xiong, the leader of the conspiracy, brought pounds of methamphetamine into the Wausau area from Minneapolis/St. Paul, Minnesota. Law enforcement agents seized almost 5 pounds of methamphetamine in connection with the investigation, though agents believe the conspiracy was responsible for well over 10 pounds flowing into the Wausau area. Lisa Xiong pleaded guilty in September and is scheduled to be sentenced by Judge Peterson on December 17.
Khang assisted Lisa Xiong by collecting debts from local methamphetamine distributors and supervising lower level deals. Khang also accompanied Lisa Xiong on trips to Minnesota to pick-up large quantities of methamphetamine and acted as her back-up should anything happen. Judge Peterson described her as the protégé to the leader of the organization. Khang was also charged in three counts with distributing methamphetamine. Khang was responsible for approximately 120 grams of methamphetamine, but she had a much larger role as the right-hand-person to Lisa Xiong. Khang has a significant criminal history, though this is her first federal conviction.
Chou Xiong conspired with Lisa Xiong by traveling with her to the drug source in Minnesota, pooling money with her to buy large quantities of methamphetamine and overseeing lower-level drug distributors in the Wausau area. Additionally, Chou Xiong was charged with distributing methamphetamine that he purchased from Lisa Xiong on eight occasions. Conservatively, his relevant conduct included almost 200 grams of pure methamphetamine. This is Chou Xiong’s first federal conviction.
Chou Xiong, Soua Khang and nine other individuals were charged in an indictment returned by a federal grand jury in September 2019 for their roles in this methamphetamine distribution conspiracy. Chou Xiong and Soua Khang are the second and third individuals to plead guilty and be sentenced. On June 12, 2020, Meng Xiong, also of Wausau, was sentenced by Judge Peterson to 5 years in prison for his role in the conspiracy.
The charges against these individuals were the result of an investigation conducted by the Federal Bureau of Investigation; Central Wisconsin Narcotics Task Force; Marathon County Sheriff’s Office; Wisconsin Department of Justice Division of Criminal Investigation; Lincoln County Sheriff’s Office; Wausau Police Department; Everest Metro Police Department; and Wisconsin State Patrol. The prosecution of the cases has been handled by Assistant U.S. Attorney Diane Schlipper.
Toxicology Lab Owner and Marketer Sentenced for Payment of Kickbacks; Doctor Pleads Guilty to Receipt of KickbacksRead the Press Release
LEXINGTON, Ky. – Several defendants were recently convicted or sentenced for their roles in a conspiracy to violate the federal Anti-Kickback Statute. On December 4 and December 7, 2020, Uday Shah, 66, of Houston, Texas, and Timothy Andrews, 57, of Deer Park, Texas, were sentenced by Chief United States District Judge Danny C. Reeves to 24 and 15 months’ imprisonment, respectively, for their roles in a conspiracy to pay kickbacks to a physician, Dr. Ghyasuddin Syed, in exchange for Dr. Syed’s referral of urine drug testing to laboratories operated by Shah. On Wednesday, December 2, 2020, Dr. Syed pleaded guilty to soliciting and accepting kickbacks as part of the same scheme.
According to their plea agreements, Shah owned and operated several toxicology laboratories, including Pinnacle Laboratory in Lexington. Andrews worked as a marketer on behalf of Shah’s labs. Shah and Andrews admitted that between November 2014 and August 2017, they paid $475,992 in kickbacks to Dr. Syed, a Houston-area physician, and Dr. Syed’s wife, Shazana Begum. The kickbacks were often disguised as lease payments for office space owned by Dr. Syed and Begum. In his plea agreement, Dr. Syed disputed the exact amount of kickbacks, but acknowledged receiving them from Shah and Andrews, and referring urine drug testing for his patients to Shah’s labs in exchange. All of the defendants agreed that Pinnacle and Shah’s other labs billed the Medicare program for the urine drug testing tainted by these kickbacks, and that Medicare paid the labs $325,739 to which they were not entitled.Andrews pleaded guilty in June 2019, and Shah pleaded guilty in October 2019. In addition to their respective terms of incarceration, Shah and Andrews were ordered to pay $325,739 to the Medicare program in restitution, jointly and severally. Under federal law, Giles and Wallace must serve 85 percent of their prison sentences. Upon their release, they will be under the supervision of the U.S. Probation Office for three years.
Dr. Syed is scheduled to be sentenced on March 12, 2021, in Lexington. He faces up to five years in prison for the conspiracy to violate the Anti-Kickback Statute, and a maximum fine of $250,000. However, any sentence will be imposed by the Court, after its consideration of the U.S. Sentencing Guidelines and the applicable federal sentencing statutes.
Dr. Syed’s wife, Shazana Begum, has entered into a pretrial diversion agreement wherein she admitted her role in the offense, and agreed to be under the supervision of the United States Probation Office for 12 months, to pay restitution of $325,739 along with Shah and Andrews, and to perform community service.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; James Robert Brown, Special Agent in Charge, FBI, Louisville Field Office; and Derrick Jackson, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), Atlanta Field Office, jointly made the announcement.
The investigation was conducted by the FBI and HHS-OIG. The United States was represented by Assistant U.S. Attorney Paul McCaffrey.
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.
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Three Appear in Federal Court for Firearm OffensesRead the Press Release
CHARLESTON, W.Va. – United States Attorney Mike Stuart announced today that three defendants appeared in federal court this week for firearm offenses.
Adam Michael Miller, 28, of Parkersburg, was sentenced to 63 months in prison for being a felon in possession of a firearm. Miller previously admitted that he was driving a white Honda Pilot on October 28, 2019, when the vehicle was stopped by an officer with the Parkersburg Police Department in the 900 block of Williams Street in Parkersburg. Officers searched the vehicle and found a loaded Smith and Wesson .40 caliber semi-automatic pistol along with a digital scale, small empty plastic bags consistent with drug distribution, and quantities of marijuana and psilocybin mushrooms. Several .40 caliber bullets were also found on Miller’s person. The firearm had previously been reported stolen through the Parkersburg Police Department. Miller was not legally permitted to possess a firearm due to his previous conviction for the felony offense of burglary on December 6, 2017, in the Circuit Court of Calhoun County, West Virginia. Miller’s prior burglary conviction was related to his role in the kidnapping and torture of Joshua Darwin Shrader of Parkersburg in July 2016. He was sentenced to imprisonment in that case for an indeterminate sentence of not less than one nor more than fifteen years. He was later released upon parole supervision and was still on parole when this offense occurred. In addition to the burglary conviction, Miller has a history of violent and concerning behavior including 11 battery convictions, four convictions for violation of a protective order, as well as convictions for reporting a false emergency, obstructing an officer, destruction of property, and intimidation of a witness. The victims of his battery convictions include his mother, his fiancé, a mall security guard, the mother of one of his children, a corrections officer, and his younger brother. The Parkersburg Police Department conducted the investigation with the assistance of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF). Senior United States District Judge David A. Faber imposed the sentence. Assistant United States Attorney Jeremy B. Wolfe handled the prosecution.
Jeremy Vance, of Logan, was sentenced to 37 months in prison for being a felon in possession of firearms. Vance previously pled guilty and admitted that on August 15, 2019, he was carrying four long guns while riding a bicycle in West Logan. When stopped by the West Virginia State Police, Vance admitted that he knew he should not have had the guns. Vance was previously convicted of breaking and entering in Logan County Circuit Court in 2011. Vance has a lengthy criminal history and committed this offense while on state probation for other crimes. Vance also admitted to State Police that he had planned to take the four long guns to a local flea market to sell them for money to buy drugs. The guns included two Mossberg 12 gauge shotguns, one Marlin .22 caliber rifle, and one Marlin 12 gauge shotgun. The West Virginia State Police conducted the investigation. United States District Judge Irene C. Berger imposed the sentence. Assistant United States Attorney Kristin Scott handled the prosecution.
Anthony Tevan Tyner, 23, of Huntington, pled guilty to being a prohibited person in possession of a firearm. On August 29, 2019, ATF was conducting an investigation into the purchases of multiple firearms that led to a Huntington address where Tyner lived. While speaking with law enforcement, Tyner admitted to being a daily user of marijuana. Tyner also admitted that in a nearby vehicle he had in his possession a loaded I.O. Inc. model 10-15, multi-caliber rifle. Tyner faces up to 10 years in prison when sentenced on March 8, 2021. The ATF and the Barboursville Police Department conducted the investigation. United States District Judge Robert C. Chambers presided over the hearing. Assistant United States Attorney Ryan A. Keefe is handling the prosecution.
These cases are part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see: https://www.justice.gov/projectguardian.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case Nos. 2:20-cr-00022(Miller), 2:20-cr-00094(Vance) and 3:19-cr-00259(Tyner).
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Syracuse Man Pleads Guilty to Brokering Illegal Gun SalesRead the Press Release
SYRACUSE, NEW YORK – Daniel Morales, 36, of Syracuse pled guilty yesterday to causing the sale of firearms and ammunition to a convicted felon, announced Acting United States Attorney Antoinette T. Bacon, John B. DeVito, Special Agent in Charge of the New York Field Division of the United States Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), and Chief Kenton Buckner, City of Syracuse Police Department.
In pleading guilty yesterday Daniel Morales admitted that he acted as a middleman in the sale of 13 firearms and ammunition recovered in a joint investigation conducted by the United States Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the Syracuse Police Department. The investigation in late 2018 and early 2019 included undercover purchases of stolen firearms, fully automatic weapons, illegally short-barreled rifles, and non-commercially fabricated “ghost guns” (pistols and rifles). Morales brokered a series of undercover firearms sales in Syracuse and Solvay from sellers Luis Matos, and later Jovaun Clark. During these sales, Morales connected the illegal firearms sellers with the undercover buyer for a fee paid in cash. The sales of the firearms included:
- one (1) Ruger, model 10-22RB Carbine rifle, caliber .22LR
- one (1) Marlin, model 1894 Carbine rifle, .357 caliber
- one (1) Marlin, model 1894 Carbine rifle, .357 caliber
- one (1) stolen Gristmill MFG, Valley Arms model XM177ES, .223/.556 caliber rifle with illegally short barrel
- one (1) grey and black P80, unserialized 9mm caliber “ghost gun” pistol
- one (1) black P80, un-serialized .40 caliber “ghost gun” pistol
- one (1) grey and black P80, unserialized .40 caliber “ghost” gun pistol with a threaded barrel
- one (1) fully automatic tan and black P80, un-serialized .40 caliber “ghost gun” pistol
- one stolen (1) Ruger, model Mini-Thirty, 7.62 caliber rifle
- one (1) grey and black rifle bearing no make, model or serial number, .223 caliber, with an illegally short-barrel
- one (1) fully automatic grey and black P80 9mm caliber unserialized “ghost gun” pistol
- one (1) Smith and Wesson, model 5906 9mm pistol
- one (1) black and tan semiautomatic pistol with extendable grip, caliber 5.56 x 45 mm, bearing no serial number.
Luis Matos pled guilty to being a felon in possession of firearms and was sentenced on July 28, 2020, to serve 60-months in federal prison, followed by a 3-year term of supervised release.
Jovaun Clark is charged in a pending indictment with several firearms offenses. The charges in the indictment are merely accusations and he is innocent until or unless proven guilty
This case was investigated by The United States Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the Syracuse Police Department-Special Investigations Division, and is being prosecuted by Assistant U.S. Attorney Richard Southwick.
Six South Bay Residents Indicted in Alleged Stolen Mail and Fraud SchemeRead the Press Release
Defendants allegedly used real and counterfeit mailbox keys to gain access to identification documents for fraudulent use.
SAN FRANCISCO - A federal grand jury in San Francisco has returned an indictment charging six individuals with numerous crimes associated with a long-running conspiracy to steal mail and commit fraud in connection with identification documents, announced United States Attorney David L. Anderson and United States Postal Inspection Service Inspector in Charge Rafael Nuñez. The indictment was filed on November 17, 2020, and unsealed today.
The six defendants are Mark Guardado, Jr., 38, of San Jose; Ashley Overton, 34, of Palo Alto; Juan Dagio, 40, of San Jose; Brian Clapp, 37, of San Jose; Andrew Perez, 30, of San Jose; and Jaime Valencia-Arias, 23, of San Jose. According to the 18-count indictment, beginning no later than January of 2018, and continuing through August of 2019, the defendants conspired to steal mail and commit fraud in connection with hundreds of stolen or fraudulent identification documents. Specifically, the indictment alleges that the defendants conspired to steal United States mail by using actual or counterfeit postal keys to gain access to cluster mailboxes in apartment buildings. The defendant allegedly raided mailboxes throughout the South Bay, including in Sunnyvale, Palo Alto, Santa Clara, Redwood City, Menlo Park, and San Jose. The indictment describes text messages exchanged between the defendants regarding the use of real or counterfeit postal keys—some of which Guardado is alleged to have discussed making himself—to go out on “missions,” meaning outings in which they stole mail in bulk from apartment buildings. Defendants then obtained personal identifying information, such as names, addresses, telephone numbers, and dates of birth, from the stolen mail and other sources and used that information to create counterfeit California state driver’s licenses in the names of the victims of the stolen mail. The counterfeit licenses had photographs depicting the defendants. Using the counterfeit driver’s licenses, defendants activated and used stolen or fraudulent credit cards, negotiated checks, and used other stolen or fraudulently obtained access devices to obtain money and other things of value, including hotel rooms and cash advances at a casino.
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. The indictment charges the defendants with the crimes and maximum statutory sentences as follows:
Count
Defendant
Charge
Statute
Maximum Sentence
One
Guardado
Overton
Dagio
Clapp
Perez
Conspiracy to Commit Mail Theft and to Commit Fraud in Connection with Identification Documents
18 U.S.C. § 371
5 years’ imprisonment; $250,000 fine
Two
Guardado
Fraud in Connection with Identification Documents – Production
18 U.S.C. § 1028(a)(1)
15 years’ imprisonment; $250,000 fine
Three
Guardado
Overton
Fraud in Connection with Identification Documents – Possession of Five or More
18 U.S.C. § 1028(a)(3)
5 years’ imprisonment; $250,000 fine
Four
Guardado
Fraud in Connection with Identification Documents – Document-Making Implements
18 U.S.C. § 1028(a)(5)
15 years’ imprisonment; $250,000 fine
Five
Guardado
Fraud in Connection with Identification Documents – Trafficking
18 U.S.C. § 1028(a)(8)
15 years’ imprisonment; $250,000 fine
Six
Guardado
Overton
Possession of 15 or More Unauthorized Access Devices
18 U.S.C. § 1029(a)(3)
10 years’ imprisonment; $250,000 fine
Seven
Dagio
Fraudulent Use of Unauthorized Access Devices
18 U.S.C. § 1029(a)(2)
10 years’ imprisonment; $250,000 fine
Eight
Guardado
Unlawful Possession of Postal Keys and Locks
18 U.S.C. § 1704
10 years’ imprisonment; $250,000 fine
Nine
Guardado
Valencia-Arias
Mail Theft
18 U.S.C. § 1708
5 years’ imprisonment; $250,000 fine
Ten
Guardado
Possession of Stolen Mail
18 U.S.C. § 1708
5 years’ imprisonment; $250,000 fine
Eleven
Overton
Possession of Stolen Mail
18 U.S.C. § 1708
5 years’ imprisonment; $250,000 fine
Twelve
Overton
Possession of Stolen Mail
18 U.S.C. § 1708
5 years’ imprisonment; $250,000 fine
Thirteen
Dagio
Possession of Stolen Mail
18 U.S.C. § 1708
5 years’ imprisonment; $250,000 fine
Fourteen
Overton
Aggravated Identity Theft
18 U.S.C. § 1028(A)
2 years’ imprisonment consecutive to any other sentence; $250,000 fine
Fifteen
Overton
Aggravated Identity Theft
18 U.S.C. § 1028(A)
2 years’ imprisonment consecutive to any other sentence; $250,000 fine
Sixteen
Guardado
Aggravated Identity Theft
18 U.S.C. § 1028(A)
2 years’ imprisonment consecutive to any other sentence; $250,000 fine
Seventeen
Guardado
Aggravated Identity Theft
18 U.S.C. § 1028(A)
2 years’ imprisonment consecutive to any other sentence; $250,000 fine
Eighteen
Dagio
Aggravated Identity Theft
18 U.S.C. § 1028(A)
2 years’ imprisonment consecutive to any other sentence; $250,000 fine
Any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
All the defendants are in either federal or state custody except Perez, who remains at large. Guardado and Clapp made their initial federal court appearances this morning before U.S. Magistrate Judge Laurel Beeler. Judge Beeler ordered that Guardado be detained pending a bail study and a further hearing for December 14, 2020. Clapp was released on a $25,000 bond. Valencia-Arias will make his initial appearance before U.S. Magistrate Judge Susan van Keulen on Thursday, December 10, 2020. The defendants next scheduled appearance is at 10:30 a.m. on January 12, 2021, for a status hearing before the before the Honorable Vince Chhabria, U.S. District Judge.
The prosecution is being handled by the Special Prosecutions Section of the United States Attorney’s Office. The prosecution is the result of an investigation by the United States Postal Inspection Service.
Sex Trafficking Couple Who Exploited Women for Profit Receive Federal SentencesRead the Press Release
SHERMAN, Texas – A couple who were charged with running a commercial sex operation in multiple locations in north Texas have been sentenced to federal prison, announced U.S. Attorney Stephen J. Cox today.
Quan Tu (a/k/a Aaron Tu Chan), 48, pleaded guilty on July 6, 2020, to coercing and enticing individuals to travel in interstate commerce to engage in prostitution and was sentenced to 180 months in federal prison today by U.S. District Judge Amos L. Mazzant.
A co-defendant, Li Xin, 45, previously pleaded guilty to conspiring to travel or causing another to use interstate facilities to promote, manage, establish, or carry on an unlawful prostitution business. On October 1, 2020, Judge Mazzant sentenced Xin to 57 months’ imprisonment.
According to information presented in court, beginning in December 2018, the Richardson, Texas Police Department received numerous complaints from the public that men were traveling to a condominium at all hours of the day and night, and that some of these men were knocking on neighbors’ doors, seeking sexual services. Further investigation by a state and federal task force revealed that Tu and Xin were operating a prostitution enterprise from that location. During the investigation, it was revealed that Tu and Xin operated similar commercial sex rings out of a single-family residence in Plano and the ABC Foot Spa in Garland.
“Sex trafficking is amongst the most heinous crimes a person can commit,” said U.S. Attorney Stephen Cox. “The Department of Justice is committed to battling this scourge by forging partnerships and leveraging federal resources to identify and prosecute those that would engage in such criminality.”
“Those involved in the sexual exploitation of innocent victims through manipulation or force will face dire consequences for their actions,” said Ryan L. Spradlin, special agent in charge Homeland Security (HSI) Dallas. “With support from our law enforcement partners, NGO’s and the public, we will continue to prosecute anyone who participates or supports this illegal and heinous commercial trade for personal gain.”
As part of their guilty pleas, Tu and Xin admitted that they maintained all three properties and that they had women engaged in commercial sex at these locations between December 2018 and August 2019. The defendants admitted that they and other co-conspirators used Internet-based texting applications to communicate with women and entice them to travel to Texas to work as masseuses. The women came from various locations, including New York City, China, and Australia. Tu admitted to driving to Houston and other locations to bring women back to the properties. Once in Tu and Xin’s employ, the women lived and serviced customers at the properties, with the conspirators soliciting clients through online advertisements for commercial sexual services. Tu and Xin admitted to not only collecting all of the women’s earnings, but additionally charging the women $20 per day. Tu and Xin only permitted the women to keep their tips, thus compelling the women to engage in commercial sex in order to earn enough money to purchase food and basic necessities. The scheme resulted in proceeds which allowed Tu and Xin to maintain their lifestyle and to purchase vehicles, including a 2017 Toyota Tundra, all of which have been criminally forfeited.
This case was investigated by Homeland Security Investigations, Texas Department of Public Safety, and the Richardson Police Department, with assistance of the Plano Police Department, Garland Police Department, and Dallas County Sheriff’s Office and was prosecuted by Assistant U.S. Attorney Marisa Miller.
Savage Man Sentenced to More Than 6 Years in Prison for Arson of Dakota County Government BuildingRead the Press Release
United States Attorney Erica H. MacDonald today announced the sentencing of FORNANDOUS CORTEZ HENDERSON, 33, to 78 months in prison for aiding and abetting arson. HENDERSON who plead guilty on August 26, 2020, was sentenced today by Judge Susan Richard Nelson, in U.S. District Court, in St. Paul, Minnesota.
According to HENDERSON’s guilty plea and documents filed with the court, HENDERSON and GARRETT PATRICK ZIEGLER[1] (co-defendant) constructed multiple Molotov cocktails. In the early morning hours of May 29, 2020, HENDERSON and the co-defendant went to the Dakota County Western Service Center (the ''WSC") located at 14955 Galaxie Avenue in Apple Valley, Minnesota. The WSC houses state and local agencies and organizations, including Dakota County court facilities, as well as a U.S. Passport center. HENDERSON admitted in his guilty plea that he chose the WSC as a target for this arson because he had previously made court appearances at that building and because he was angry with law enforcement regarding the recent death of George Floyd. Using baseball bats, HENDERSON and the co-defendant broke multiple windows at the WSC and threw in multiple, lit Molotov cocktails. Some of these devices successfully ignited and caused fire damage to the WSC. The attacked caused hundreds of thousands of dollars in damage.
According to HENDERSON’s guilty plea and documents filed with the court, HENDERSON and the co-defendant also started and attempted to start other fires at the WSC by pouring ignitable liquids and throwing unlit Molotov cocktails in and around the broken windows, then attempting to start the fluids on fire.
This case is the result of an investigation conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the Apple Valley Police Department, and the Dakota County Sheriff’s Office, with assistance from the Dakota County Attorney’s Office.
This case was prosecuted by Assistant U.S. Attorneys Alexander D. Chiquoine and Chelsea A. Walcker.
Defendant Information:
FORNANDOUS CORTEZ HENDERSON, 33
Savage, Minn.
Convicted:
- Aiding and abetting arson, 1 count
Sentenced:
- 78 months in prison
- 3 years supervised release
- $205,872.53 in restitution
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
[1] The charges against co-defendant Garrett Patrick Ziegler are accusations, and he is presumed innocent unless and until proven guilty.
San Jose Man Sentenced to Two Years Imprisonment for Damaging Cisco’s NetworkRead the Press Release
SAN JOSE – Sudhish Kasaba Ramesh was sentenced today to 24 months in prison and ordered to pay a $15,000 fine for intentionally accessing a protected computer without authorization and recklessly causing damage, announced United States Attorney David L. Anderson and Federal Bureau of Investigation Special Agent in Charge Craig D. Fair. The sentence was handed down by the Honorable Lucy H. Koh, U.S. District Judge.
Ramesh, 31, of San Jose, pleaded guilty on August 26, 2020, to one count of intentionally accessing a protected computer without authorization and recklessly causing damage to Cisco. Ramesh worked for Cisco but resigned in approximately April 2018. According to the plea agreement, Ramesh admitted to intentionally accessing the Cisco Systems cloud infrastructure that was hosted by Amazon Web Services without Cisco’s permission on September 24, 2018. Ramesh further admitted that during his unauthorized access he deployed a code from his Google Cloud Project account that resulted in the deletion of 456 virtual machines for Cisco’s WebEx Teams application, which provides video meetings, video messaging, file sharing, and other collaboration tools. He admitted that he acted recklessly in deploying the code and consciously disregarded the substantial risk that his conduct would harm Cisco. As a result of Ramesh’s conduct, over 16,000 WebEx Teams accounts were shut down for up to two weeks and caused Cisco to spend approximately $1,400,000 in employee time to restore the damage to the application and refund over $1,000,000 to affected customers. No customer data was compromised as a result of the defendant’s conduct.
Ramesh was charged by an information on July 13, 2020, with one count of Intentionally Accessing a Protected Computer Without Authorization and Recklessly Causing Damage, in violation of 18 U.S.C. §§ 1030(a)(5)(B) and (c)(4)(A)(i)(I).
U.S. District Judge Koh sentenced Ramesh today, following his guilty plea on August 26, 2020, to one count of Intentionally Accessing a Protected Computer Without Authorization and Recklessly Causing Damage, in violation of 18 U.S.C. §§ 1030(a)(5)(B) and (c)(4)(A)(i)(I). The defendant was further sentenced to serve a one year period of supervised release following the 24 months in prison and to pay a $15,000 fine. The defendant is out of custody and will begin serving the sentence on February 10, 2021.
Susan Knight is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Elise Etter. The prosecution is the result of an investigation by the Federal Bureau of Investigation. Cisco Systems, Inc. fully cooperated with the U.S. Attorney’s Office and Federal Bureau of Investigation.
Repeatedly deported aliens sentenced to federal prison after returning to U.S. and caught committing crimesRead the Press Release
AUGUSTA, GA: Four illegal aliens have been sentenced to prison terms for returning to the U.S. after prior deportation, and five others have made U.S. District Court appearances on similar charges.
Most of the defendants have been removed previously, most twice or more, before returning illegally, said Bobby L. Christine, U.S. Attorney for the Southern District of Georgia.
“These illegal aliens have previously been removed, only to return to the United States illegally and commit additional crimes,” said U.S. Attorney Christine. “When illegals are caught, local law enforcement agencies can count on our office to prosecute and remove them.”
Since 2017, the U.S. Attorney’s Office for the Southern District of Georgia has prosecuted 225 defendants for Reentry After Removal/Deportation.
Those sentenced include:
- Silvano Marroquin-Bravo, 49, a citizen of Mexico who resided in Pooler, Ga., sentenced by U.S. District Court Judge R. Stan Baker to 15 months in prison followed by three years of supervised release after pleading guilty to Reentry After Removal/Deportation. After Marroquin-Bravo was arrested by Garden City, Ga., police in May on traffic and on outstanding warrants for domestic violence and weapons-related state offenses, an immigration check determined he previously was deported in 2017, 2018 and 2019 and returned illegally to the United States.
- Jose Louis Amezquita-Montenegro, 41, a citizen of Guatemala, was sentenced to 24 months in prison by U.S. District Court Chief Judge J. Randal Hall after pleading guilty to Reentry After Removal/Deportation, followed by one year of supervised release. Amezquita-Montenegro was arrested by Grovetown Public Safety officers Jan. 28, 2020, and found to have been deported in 2014 after an arrest in Columbia County; in 2016 after an arrest in Jefferson County; and was to have been transferred to federal custody in preparation for deportation after being sentenced to state prison in 2017 on an assault charge in Columbia County. Instead he was released to probation on April 30, 2019, and arrested in Grovetown nine months later on state charges of theft by receiving stolen property and obstruction of an officer.
- Cristian Eduardo Flores-Garcia, 32, a citizen of Honduras, sentenced to 18 months in prison by Chief Judge Hall after pleading guilty to Reentry After Removal/Deportation, followed by one year of supervised release. Flores-Garcia, who previously was deported twice in 2012 from Walesco, Texas, after illegally entering the United States, was arrested Jan. 26, 2020 by Richmond County Sheriff’s deputies responding to a report of an armed altercation in a restaurant parking lot.
- Ezequiel Guarda-Lopez, 59, a citizen of Mexico, pled guilty before Chief Judge Hall to a charge of Reentry After Removal/Deportation and was sentenced to time served. Guarda-Lopez, who previously was deported in 1998 and 2002, was arrested by Richmond County Sheriff’s deputies after an Aug. 20, 2020, traffic stop. He is now subject to deportation.
Five other defendants indicted on charges of Reentry After Removal/Deportation made initial court appearances this week before U.S. District Court Magistrate Judge Christopher L. Ray:
- Juan Pablo Alvarado-Valadez, 41, a citizen of Mexico. Alvarado-Valadez, previously deported in 2017, was arrested after a traffic stop in Statesboro, Ga., in April 2019.
- Victor Martinez-Luna, 32, a citizen of Mexico, was arrested on state charges including burglary on Oct. 11, 2020, by Garden City, Ga., police, and found to have been deported previously in 2019.
- Walter Godinez-Perez, 32, a citizen of Guatemala, was discovered to be illegally present in the United States after his Oct. 22, 2020, arrest in Garden City on state charges. Godinez-Perez previously was deported in 2011, 2012 and 2015.
- Gabriel Solis, 43, a citizen of Mexico, was arrested May 28, 2019, by Richmond County Sheriff’s deputies and later convicted on state family violence charges. He was previously deported in 2018.
- Jesus Villasenor-Lopez, 25, a citizen of Mexico, was arrested on traffic charges including driving under the influence on Oct. 17, 2020, by Richmond County Sheriff’s deputies and was discovered to be in the country illegally after having been deported in 2013.
Criminal indictments contain only charges; defendants are presumed innocent unless and until proven guilty.
The cases were investigated by U.S. Customs and Border Protection; U.S. Immigration and Customs Enforcement/Homeland Security Investigations; and by local law enforcement agencies, and prosecuted for the United States by Assistant U.S. Attorneys Alejandro V. Pascual IV and Joseph McCool.
Redwood City Man Sentenced to 15 Years in Prison for Trafficking Drugs and Illegal GunsRead the Press Release
SAN FRANCISCO – Ismael Garcia, a/k/a “Playboy,” was sentenced to 15 years in prison for trafficking methamphetamine, dealing in firearms without a license, and being a felon in possession of firearms, announced United States Attorney David L. Anderson, Drug Enforcement Administration (DEA) Special Agent in Charge Daniel C. Comeaux, and Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) Special Agent in Charge Patrick Gorman. The sentence was handed down by the Honorable Richard Seeborg, U.S. District Judge.
Garcia, 35, of Redwood City, pleaded guilty to the charges on January 17, 2020. According to his application to the court to plead guilty, Garcia admitted that between June and August of 2019 he was a member of a conspiracy to traffic methamphetamine. Garcia’s participation in the conspiracy included arranging three one-pound methamphetamine transactions that took place on June 19, July 24, and August 20, 2019. In each instance, Garcia worked with his co-conspirator to obtain the methamphetamine, which Garcia sold to an undercover law enforcement agent.
Garcia also admitted that on June 13, 2019, he sold a fully-automatic machine gun pistol and a 30-round magazine to the same undercover agent. During additional transactions in June of 2019, Garcia sold the undercover agent more illegal guns. At the time, Garcia was a convicted felon and did not have a license to sell firearms.
A federal grand jury indicted Garcia on November 12, 2019, charging him with one count of conspiracy to distribute and possess with intent to distribute 500 grams and more of a mixture and substance containing a detectable amount of methamphetamine, in violation of 21 U.S.C. §§ 846, 841(a)(1) and (b)(1)(A)(viii); three counts distribution of fifty grams and more of a mixture and substance containing a detectable amount of methamphetamine, in violation of 21 U.S.C. §§ 841(a)(1) and (b)(1)(B)(viii); one count of dealing in firearms without a license, in violation of 18 U.S.C. § 922(a)(1)(A); one count of possession and transfer of a machine gun, in violation of 18 U.S.C. § 922(o); and one count of being a felon in possession of a firearm, in violation of 18 U.S.C. § 922(g)(1). Garcia pleaded guilty to all charges.
In addition to the prison term, Judge Seeborg also ordered the defendant to serve a five-year period of supervised release. The defendant will begin serving the sentence immediately.
The case is being prosecuted by the Organized Crime Drug Enforcement Task Force (OCDETF) of the United States Attorney’s Office for the Northern District of California. The investigation of this case was conducted by the Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms, and Explosives, and the San Mateo County Sheriff’s Office Narcotics Task Force.
This investigation and prosecution is part of OCDETF, which identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
Randolph County man admits to methamphetamine chargeRead the Press Release
ELKINS, WEST VIRGINIA – Jesse David Tolson, of Elkins, West Virginia, has admitted to a drug charge, U.S. Attorney Bill Powell announced.
Tolson, 34, pled guilty to one count of “Possession with Intent to Distribute More Than Fifty Grams of Methamphetamine.” Tolson admitted to having more than 50 grams of methamphetamine in December 2019 in Randolph County.
Tolson faces at least 10 years and up to life incarceration and a fine of up to $10 million. 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 Stephen D. Warner is prosecuting the case on behalf of the government. The Mountain Region Drug & Violent Crimes Task Force investigated.
U.S. Magistrate Judge Michael John Aloi presided.
Prince William County Man Sentenced for Selling FentanylRead the Press Release
ALEXANDRIA, Va. – A Prince William County man was sentenced today to 18 months in prison for selling fentanyl.
According to court documents, between February 2019 and May 2019, Keith Issiah Slade, 46, and a co-defendant, sold fentanyl in and around the Eastern District of Virginia. They would obtain the fentanyl in Baltimore, Maryland and traffic it into Virginia. One of their customers was Individual 1, to whom they sold at least 55 capsules containing heroin/fentanyl. In May 2019, Individual 1 consumed fentanyl provided to her by Slade and the co-defendant. She was later found deceased, and the cause of death was ruled to be mixed drug intoxication. Individual 1 had numerous substances in her system, including fentanyl.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia; Mark R. Herring, Attorney General of Virginia; and Colonel Edwin C. Roessler Jr., Fairfax County Chief of Police, made the announcement after sentencing by U.S. District Judge Rossie D. Alston.
Special Assistant U.S. Attorney Karolina Klyuchnikova and Assistant U.S. Attorney Bibeane Metsch prosecuted the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:20-cr-224.
Pittsburgh Resident Sentenced in Multi-Million Dollar Health Care Fraud ConspiracyRead the Press Release
PITTSBURGH, Pa. – A resident of Pittsburgh was sentenced in federal court for conspiracy to defraud the Pennsylvania Medicaid program and health care fraud, United States Attorney Scott W. Brady announced today.
United States District Judge Cathy Bissoon sentenced Terra Dean, 46, to four years of probation, including six months of home detention for her role in a years-long conspiracy. Dean was also ordered to pay restitution to the Pennsylvania Medicaid program in the amount of $94,101.55.
During her plea hearing on January 21, 2020, Dean admitted that between 2011 and 2017 she was an employee of Moriarty Consultants, Inc. (MCI), one of four related entities operating in the home health care industry. The other three entities were Activity Daily Living Services, Inc. (ADL), Coordination Care, Inc. (CCI), and Everyday People Staffing, Inc. (EPS). MCI, ADL, and CCI were approved under the Pennsylvania Medicaid program to offer certain services to qualifying Medicaid recipients ("consumers"), including personal assistance services (PAS), service coordination, and non-medical transportation, among other services. Between in and around January 2011 and in and around April 2017, MCI, ADL, and CCI, collectively, received more than $87,000,000 in Medicaid payments based on claims submitted for these services, with PAS payments accounting for more than $80,000,000 of the total amount.
During that time, Dean admitted that she participated in a wide-ranging conspiracy to defraud the Pennsylvania Medicaid program for the purpose of obtaining millions of dollars in illegal Medicaid payments through the submission of fraudulent claims for services that were never provided to the consumers identified on the claims, or for which there was insufficient or fabricated documentation to support the claims. As part of the conspiracy, Dean admitted that she fabricated timesheets to reflect the provision of in-home PAS care that, in fact, she never provided to the consumers identified on the timesheets. Dean further admitted that she caused the submission of Medicaid claims in the name of "ghost" employees—including, close relatives—for PAS care that was never provided to the consumers specified on Medicaid claims. Likewise, Dean admitted that she paid kickbacks to consumers in exchange for the consumers’ cooperation in the fraudulent billing scheme. In total, Dean admitted causing losses to the Pennsylvania Medicaid program in excess of $150,000.
To date, twelve defendants have pleaded guilty for their roles in the conspiracy.
Assistant United States Attorney Eric G. Olshan and Special Assistant United States Attorney Edward Song are prosecuting this case on behalf of the government. The Federal Bureau of Investigation, Pennsylvania Office of the Attorney General – Medicaid Fraud Control Unit, Internal Revenue Service – Criminal Investigation, U.S. Department of Health and Human Services – Office of Inspector General, and United States Postal Inspection Service conducted the investigation of the defendants.
Pittsburgh Man Admits Possessing Hundreds of Images and Videos of Children Engaged in Sexually Explicit ConductRead the Press Release
PITTSBURGH - A former resident of Pittsburgh, Pennsylvania, pleaded guilty in federal court to a charge of possession of material depicting the sexual exploitation of a minor, United States Attorney Scott W. Brady announced today.
Krent Jeffrey Haight, age 48, pleaded guilty to one count before United States District Judge Cathy Bissoon.
In connection with the guilty plea, the court was advised that on November 14, 2018, Haight knowingly possessed approximately 1500 still images and videos in computer graphics files, the production of which involved the use of minors engaging in sexually explicit conduct, some of whom had not yet attained 12 years of age. Haight admitted that he uploaded numerous such images to Tumblr, a social networking website, making them available for public viewing.
Judge Bissoon scheduled sentencing for April 15, 2021, at 10:00 a.m. The law provides for a total sentence of not less than 10 years nor more than 20 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Pending sentencing, the court ordered that Haight remain in custody.
Assistant United States Attorney Carolyn J. Bloch is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation conducted the investigation that led to the prosecution of Haight.
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 (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Penfield Man Pleads Guilty to Bilking Investors Out of Hundreds of Thousands of DollarsRead 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 Brian L. Schumacher, 55, of Penfield, NY, pleaded guilty before Senior U.S. District Judge William M. Skretny to conspiracy to commit wire fraud. The charge carries a maximum penalty of 20 years in prison and a fine of $250,000.
Assistant U.S. Attorney Charles M. Kruly, who is handling the case, stated that, according to a previously-filed criminal complaint and the defendant’s plea agreement, between April and December of 2016, the defendant conspired with others to defraud two investors out of hundreds of thousands of dollars. The actions of Schumacher and others led investors, located in Massachusetts and California, to wire significant amounts of funding to Schumacher’s company, Integra Diamonds, located in Rochester, NY, to enable Integra Diamonds to purchase diamonds in Africa.
The Massachusetts victim (Victim 1) was contacted by a co-conspirator of the defendant, who initially indicated that an investment of $100,000.00 would yield a minimum profit of $60,000.00 in one year. Skeptical because of the generous return that was promised, Victim 1 sought assurances that he was not the initial or sole investor in Integra Diamonds. Subsequently, Victim 1 received documents that falsely suggested that Integra Diamonds had other investors, and which also falsely claimed that Integra Diamonds had agreements with a logistics vendor and U.S.-based diamond purchasers. On June 16, 2016, Victim 1 wire transferred $100,000.00 from his bank account to an account in the name of Integra Diamonds. During the course of the conspiracy, $30,000 was returned to Victim 1, but not the remaining $70,000 of his initial investment nor any of the promised return. $44,000 of Victim 1’s funds were attempted to be wired to Schumacher while he was in Sierra Leone to purchase diamonds. When that wire was unsuccessful, $44,500 was returned to a co-conspirator’s personal bank account.
Victim 2, a resident of California, also invested $100,000.00 in Integra Diamonds, after receiving a promise for a significant return. On December 2, 2016, Victim 2 wire transferred $100,000.00 from his bank account to an Integra Diamonds bank account. Schumacher then withdrew $90,000 in cash from Victim 2’s investment, which he spent on expenses associated with another trip to Sierra Leone to purchase diamonds. Schumacher used Victim 2’s money to purchase, among other things, 1,211.85 carats of industrial diamonds for $30,296.25. Schumacher then resold those diamonds to a U.S. diamond broker for $11,514, none of which was returned to Victim 2. Over the course of the next year, Victim 2 made multiple requests for status updates and for return of his fund. Schumacher provided a number of excuses for the failure of Victim 2's investment, including that the diamond purchase was simply taking longer than expected and that the original diamond purchase fell through. Victim 2 was also informed that Schumacher was trying to secure another deal. Ultimately, Integra Diamonds did not repay Victim 2 any portion of the $100,000 loan principle, or any interest.
The plea is the result of an investigation by the U.S. Postal Inspection Service, under the direction of Boston Division Inspector-in-Charge Joseph W. Cronin, and the Internal Revenue Service, Criminal Investigations Division, under the direction of Jonathan D. Larsen, Special Agent-in-Charge.
Sentencing is scheduled for March 24, 2021, before Judge Skretny.
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Parkersburg Man Sentenced to Four Years in Federal Prison for Dealing MethamphetamineRead the Press Release
CHARLESTON, W.Va. – United States Attorney Mike Stuart announced today that Andrew Martin Hopkins, 58, of Parkersburg, was sentenced to 48 months in prison pursuant to his previous guilty plea to possession with intent to distribute methamphetamine.
“Hopkins had over 100 grams of meth that was 96% pure,” said United States Attorney Mike Stuart. “Another significant prison sentence for a dealer of this deadly drug.”
Hopkins previously admitted that he was driving a pickup truck in Vienna on May 19, 2019, when he was pulled over by an officer with the Vienna Police Department near the intersection of Grand Central Avenue and 21st Street for displaying a license plate that belonged on a vehicle of a different make and model. After the officer determined that Hopkins could not produce proper registration or proof of insurance for the vehicle, a K-9 was requested to respond to the scene of the traffic stop. After the K-9 arrived, it was deployed on the vehicle and provided a positive indication for the presence of controlled substances. Officers then searched and located methamphetamine inside the truck as well as on Hopkins’ person. A total of 102.85 grams of methamphetamine was located during the search, along with $3,631 in United States currency. This methamphetamine was sent to a laboratory and was confirmed to have a purity of 96%. Hopkins admitted to possessing the entire amount of methamphetamine and having the intention to distribute it to other people. Hopkins also admitted to selling methamphetamine to a confidential informant working with law enforcement officers on four different occasions.
The Vienna Police Department, the Parkersburg Narcotics Task Force, and the Federal Bureau of Investigation (FBI) conducted the investigation. Senior United States District Judge David A. Faber imposed the sentence. Assistant United States Attorney Jeremy B. Wolfe handled the prosecution.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 2:20-cr-00003.
Follow us on Twitter: SDWVNews and USAttyStuart
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Ohio Man Sentenced to Five Years in Federal Prison for Methamphetamine OffenseRead the Press Release
CHARLESTON, W.Va. – United States Attorney Mike Stuart announced today that Devante Terrell Hatch, 28, of Akron, Ohio, was sentenced to 60 months in federal prison for possession with intent to distribute methamphetamine.
“This Akron drug dealer was caught with more than four pounds of meth in his vehicle,” said United States Attorney Mike Stuart. “And now he’ll be spending the next five years in federal prison.”
On February 25, 2019, the Parkersburg Narcotics Task Force (PNTF) received a tip that a large load of drugs was being delivered to a specific apartment on Staunton Avenue between 9:00p.m. and 11:00p.m. and that it would be coming from Akron, Ohio in a vehicle with Ohio license plates. Uniformed Parkersburg Police Officers began surveilling the area. At 10:05 p.m., they observed a GMC Terrain with Ohio license plates pull into the alley behind Staunton Avenue and park directly behind the apartment. Officers approached Hatch, who was driving the vehicle. Hatch claimed to be there to visit his girlfriend, but he could not tell them where she lived. The officers smelled marijuana and asked Hatch whether he had any in the vehicle. Hatch admitted that he did, and officers searched the vehicle. The officers located and seized two backpacks containing marijuana and more than four pounds of methamphetamine. At the plea hearing, Hatch admitted that he intended to distribute the methamphetamine in Parkersburg.
The Parkersburg Narcotics Task Force and the Parkersburg Police Department conducted the investigation. United States District Judge Irene C. Berger imposed the sentence. Assistant United States Attorney Joshua C. Hanks handled the prosecution.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 2:20-cr-00061.
Follow us on Twitter: SDWVNews and USAttyStuart
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Northern District of Iowa Assistant United States Attorney Recognized for Superior PerformanceRead the Press Release
Assistant United States Attorney (AUSA) Daniel Chatham of the U.S. Attorney’s Office in the Northern District of Iowa was recognized by the U.S, Department of Justice’s Executive Office for U.S. Attorneys (EOUSA) with the a Director’s Award for Superior Performance as an AUSA. United States Attorney Peter E. Deegan, Jr. presented Mr. Chatham with the award on December 2, 2020.
Mr. Chatham was recognized for his superior performance as a Criminal AUSA. Since 2010, Mr. Chatham has been the Northern District of Iowa United States Attorney’s Office’s chief opioid prosecutor. During this time, he has prosecuted over 80 opioid cases, approximately 40 of which involved opioid deaths or injuries. These prosecutions have included six opioid overdose trials. As a result of his work, Mr. Chatham has developed a nationally recognized expertise in the investigation and prosecution of overdose cases. His expertise has led to nationwide invitations to speak on the subject, and frequent consultations with AUSAs from across the country. This award recognizes that Mr. Chatham has been instrumental in the Department of Justice’s battle against opioid abuse.
Mr. Chatham has prosecuted the most difficult and noteworthy opioid cases in the Northern of District of Iowa for the last decade. In 2015, he prosecuted the first known fentanyl dealer in the Cedar Rapids. In response to a substantial short-term increase in opioid overdoses in the Cedar Rapids area in early 2015, investigators and Mr. Chatham aggressively investigated the sources of the fentanyl-laced heroin that was being transported to Iowa from Chicago. Ultimately, Mr. Chatham prosecuted four defendants for distributing these drugs – drugs that resulted in two deaths and six serious bodily injuries. The lead defendant was sentenced to life imprisonment.
Another noteworthy case prosecuted by Mr. Chatham involved a street-level heroin dealer in Dubuque, Iowa, in early 2016. After returning from a resupply trip to Chicago, the dealer sold several grams of purported heroin to one of his customers. The customer provided portions of the purported heroin to three friends in his car, and then another individual inside a nearby apartment. Two of the friends in the car nearly immediately overdosed, requiring lifesaving measures by first responders. The individual inside the apartment was found deceased the next day. Laboratory analysis of the substances found in the car and apartment determined that the substance the dealer sold actually contained heroin and furanyl fentanyl, a fentanyl analogue that was not on the controlled substances schedules. With Mr. Chatham as lead counsel at trial, the dealer was convicted of distribution of, and conspiracy to distribute heroin and furanyl fentanyl resulting in two serious bodily injuries and a death. The dealer was sentenced to 252 months’ imprisonment.
Applying the principles he learned from these prior prosecutions, AUSA Chatham prosecuted another defendant in 2018 for distribution of heroin resulting in death. This case again involved complicated issues of multiple drug toxicity, this time involving cocaine and heroin. Mr. Chatham successfully prosecuted the defendant, with a jury finding that the heroin, and not the cocaine, caused the victim’s death. The defendant was sentenced to life imprisonment.
“Through his outstanding work, Assistant United States Attorney Dan Chatham has prosecuted the most difficult cases involving incredibly dangerous opioids at a time when the nation has been going through an opioid crisis,” said United States Attorney Peter E. Deegan, Jr. “Mr. Chatham showed tireless dedication, hard work, and an unyielding pursuit of justice while ensuring that those who distributed drugs that hurt and killed others were held accountable for their actions.”
EOUSA provides oversight, general executive assistance, and direction to the 94 United States Attorneys’ offices around the country. For more information on EOUSA and its mission, visit http://www.justice.gov/usao.
Follow us on Twitter @USAO_NDIA.
Northern California Man Indicted for Attempted Child Sex TraffickingRead the Press Release
RENO, Nev. – A Northern California resident had his initial appearance in federal court today following his arrest for attempted child sex trafficking, announced U.S. Attorney Nicholas A. Trutanich of the District of Nevada.
A federal grand jury returned an indictment charging Jeffrey Lofstead, 63, of Kings Beach, Placer County, California, with one count of attempted sex trafficking of children. He was arraigned before U.S. Magistrate Judge William G. Cobb, who scheduled a jury trial on February 8, 2021.
According to allegations made in the indictment, on or about October 7, 2020, Lofstead attempted to recruit and solicit a child, who had not yet attained 18 years, to engage in a commercial sex act.
If convicted, the statutory maximum penalty is life in prison.
An indictment merely alleges that a crime has been committed. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The case was investigated by the FBI’s Northern Nevada Child Exploitation and Human Trafficking Task Force, which includes the FBI; Reno Police Department; Washoe County Sheriff's Office; Nevada Attorney General's Office; Carson City Sheriff's Office; Douglas County Sheriff's Office; Nevada Highway Patrol; Nevada Department of Corrections; University of Nevada, Reno Police Department; and the Sparks Police Department. Assistant U.S. Attorney Peter Walkingshaw is prosecuting the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Department of Justice’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc.
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North Adams Man Sentenced to 30 Years in Prison for Distributing Fatal Drug to Young Afghanistan Veteran, and Then Incinerating His Body to Destroy EvidenceRead the Press Release
KALAMAZOO, MICHIGAN — On 7 December 2020, Damiane Buehrer, 43, was sentenced to serve 30 years in the Federal Bureau of Prisons for distributing a fatal dose of the deadly synthetic opioid carfentanil to Tyler Herendeen, then a resident of Hillsdale County.
In the early evening hours of 11 January 2017, on a remote section of Voorheis Rd. in Hillsdale County, Somerset Township firefighters responded to a 911 call reporting a blazing fire that had fully engulfed a Ford Escape. After the fire was extinguished, a badly burned human body was discovered in the trunk-space of the car. The body was subsequently identified through dental records as that of 30-year-old Herendeen, a life-long resident of Hillsdale County and an honorably-discharged member of the Michigan Army National Guard who had served in the Afghanistan war. Subsequent investigation by the Michigan State Police and the FBI determined that the cause of death was ingestion of carfentanil, an extremely toxic synthetic opioid that is increasingly being found in heroin mixtures. Indicted in April 2019, Buehrer pled guilty a few days before trial in July 2020 to giving the drug to Herendeen, and also admitted that he burned Herendeen’s body after he died in an effort to destroy evidence.
“Hopefully, the conviction and sentence in this case will provide Tyler’s family and friends with the comfort of knowing that justice was done, that Buehrer is out of circulation for decades to come, and that no one else will suffer the same fate as Tyler because of him. The sentence in this case should also send a clear message to anyone involved in illegal opioid distribution that the West Michigan law-enforcement community will come after them, and that they risk decades in prison every time they give another person their drugs,” said U.S. Attorney Andrew Birge.
“The death of Tyler Herendeen resulted from a tragic series of events brought about by Mr. Buehrer’s callous disregard for the lives of those to whom he gave drugs,” said David G. Nanz, Acting Special Agent in Charge of the FBI in Michigan. “No part of our country has been spared the effects of the opioid crisis. Those who engage in the illegal distribution of drugs will be held responsible for the inevitable consequences of their criminal behavior.”
“Today will hopefully provide some small amount of closure to the Herendeen family, as well as all who knew and cared about Tyler,” said Detective Sergeant David Stamler of the Michigan State Police, Jackson Post. “After many years of destructive behavior, Damiane Buehrer will no longer be a danger to the Hillsdale community. The Michigan State Police would like to thank the US Attorney’s Office for the Western District of Michigan, as well as the FBI, for the many long hours of assistance provided to the MSP over the last three years. These partnerships often make the difference in bringing a successful conclusion to investigations that take such devastating tolls on Michigan families.”
The case was investigated by the Federal Bureau of Investigation and the Michigan State Police. Michigan State Police troopers and detectives responded to the initial scene of the fire and investigated the case in collaboration with the FBI. The case was prosecuted by Assistant
U.S. Attorneys Hagen W. Frank and Kate Zell, who also prosecuted Buehrer for engaging in interstate dog fighting for profit. Buehrer was sentenced in October 2018 to serve a 46-month- sentence in the Federal Bureau of Prisons for the dog-fighting offense, while the investigation into Herendeen’s death continued. Buehrer will be required to complete the prison term for the dog-fighting case before he begins serving his 30-year-sentence.
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New York Man Sentenced to Prison for Defrauding Sprint CorporationRead the Press Release
PITTSBURGH, PA – A resident of New York, NY was sentenced in federal court to charges of fraud conspiracy and aggravated identity theft, United States Attorney Scott W. Brady announced today.
Ramses Nathaniel Acosta, 39, was sentenced on two counts before United States Senior District Judge Joy Flowers Conti.
According to information provided to the court, Acosta, in a multi-state scheme, defrauded Sprint Corporation by using counterfeit drivers’ licenses to purchase cell phones and electronics in the identities of existing Sprint customers.
Judge Conti sentenced Acosta to 27 months’ incarceration, and two years’ supervised release.
Assistant United States Attorney Gregory C. Melucci prosecuted this case on behalf of the government.
Agents from Homeland Security Investigations conducted the investigation leading to the prosecution of Acosta.
More Than 100 Firearm “Switch” Devices Seized from Suburban Chicago Home; Devices Are Capable of Turning Handguns into Machine GunsRead the Press Release
CHICAGO — A suburban Chicago man was arrested on a federal firearm charge after law enforcement this week seized machine guns and more than 100 “switch” devices from his home. Each device is capable of converting a semi-automatic pistol into a machine gun.
LEONARD D. JOHNSON, also known as “Scrap,” 32, of Robbins, is charged with one count of illegal possession of a machine gun. Johnson was arrested Monday after agents from the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives executed a search warrant at his home. The agents seized five firearms, including three machine guns, and approximately 117 “switch” devices, according to a criminal complaint and affidavit filed in U.S. District Court in Chicago.
Johnson made an initial court appearance Tuesday before U.S. Magistrate Judge Jeffrey T. Gilbert in Chicago and was ordered to remain in federal custody. A detention hearing is scheduled for Friday at 1:00 p.m.
The arrest was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Kristen deTineo, Special Agent-in-Charge of the Chicago Field Division of ATF. Valuable assistance was provided by the Lansing Police Department and Midlothian Police Department. The government is represented by Assistant U.S. Attorney Charles W. Mulaney.
Holding illegal firearm offenders accountable through federal prosecution is a centerpiece of Project Guardian and Project Safe Neighborhoods. In the Northern District of Illinois, U.S. Attorney Lausch and law enforcement partners have deployed the Guardian and PSN programs to attack a broad range of violent crime issues facing the district, particularly firearm offenses.
“Machine guns pose a dangerous threat to public safety and have no place on Chicago-area streets,” said U.S. Attorney Lausch. “Federal law enforcement will act swiftly to neutralize the threat posed by illegal machine guns and keep our communities safe.”
“This case is an excellent example of continued partnership,” said ATF SAC deTineo. “ATF agents, in coordination with local law enforcement and federal prosecutors, will investigate and prosecute those in possession of these illegal firearms.”
The public is reminded that a complaint is not evidence of guilt. The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. The charge in the complaint is punishable by up to ten years in federal prison. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.
Mescalero Apache man sentenced to federal prison for chainsaw attackRead the Press Release
ALBUQUERQUE, N.M. – Josea Michael Kazhe, 20, of Mescalero, New Mexico, and an enrolled member of the Mescalero Apache Tribe, was sentenced on Dec. 8 to 18 months in federal prison after pleading guilty to assault resulting in serious bodily injury.
In his plea agreement, Kazhe admitted to assaulting another man with a chainsaw on the Mescalero Apache Reservation on Dec. 24, 2019. The victim’s injury was so serious he required emergency transportation to University Medical Center in El Paso.
Following his prison term, Kazhe will serve two years of supervised release.
The FBI investigated this case with the Bureau of Indian Affairs. Assistant U.S. Attorney Aaron O. Jordan prosecuted the case.
Member of Neo-Nazi Group Sentenced for Plot to Target Journalists and AdvocatesRead the Press Release
Johnny Roman Garza, 21, a member of the Neo-Nazi group Atomwaffen Division, was sentenced today to 16 months in prison and three years of supervised release for his role in a plot to threaten and intimidate journalists and advocates who worked to expose anti-Semitism.
Garza previously pled guilty in the U.S. District Court for the Western District of Washington to conspiring with other Atomwaffen members to commit three offenses against the United States: interference with federally-protected activities because of religion, in violation of Title 18, U.S. Code, Section 245; mailing threatening communications, in violation of Title 18, U.S. Code, Section 876; and cyberstalking, in violation of Title 18, U.S. Code, Section 2261A.
“The United States and other nations fought a global war to rid the world of murderous threats and violence by Nazis. The nation and its allies defeated Nazi Germany, but Nazi-inspired threats and violence continue to plague this nation and others 75 years after the end of World War II. The defendant threatened a Jewish journalist and conspired to intimidate journalists and advocates who worked to expose anti-Semitism around the country,” said Assistant Attorney General Eric Dreiband of the Civil Rights Division. “Threats motivated by religious intolerance are unacceptable, and so too are threats aimed at those who work to end such discrimination. The Justice Department will continue the fight against neo-Nazi-related threats and violence and is committed fully to investigating and prosecuting anyone who commits hate crimes.”
“While this defendant did not hatch this disturbing plot, he enthusiastically embraced it, researching addresses for journalists and those who oppose hate in our communities,” said Brian T. Moran U.S. Attorney for the Western District of Washington. “Ultimately in the dark of night he delivered a hateful, threatening poster -- spreading fear and anxiety. Such conduct has no place in our community.”
“Protecting our communities from terrorism, both domestic and international, is a top priority for the FBI,” said FBI Seattle Acting Special Agent in Charge Earl Camp. “Mr. Garza, along with his conspirators, targeted and intimidated journalists from minority groups with communications threatening violence. We are proud of the collaborative nationwide efforts of the FBI’s Joint Terrorism Task Forces and other law enforcement partners to hold these individuals accountable for their actions.”
In his plea agreement, Garza admitted that he conspired with the other defendants via an encrypted online chat group to identify journalists and advocates to threaten in retaliation for the victims’ work exposing anti-Semitism. The group focused primarily on journalists and advocates who were Jewish or people of color. In a message to the other co-defendants, Garza explained that the plot was designed to “have them all wake up one morning and find themselves terrorized by targeted propaganda.” On the night of Jan. 25, 2020, Garza placed a poster on the bedroom window of a prominent Jewish journalist that depicted a figure in a skull mask holding a Molotov cocktail in front of a burning home. The poster contained the victim’s name and address, and warned, “Your actions have consequences. Our patience has its limits . . . You have been visited by your local Nazis.”
The case was investigated by the FBI’s Joint Terrorism Task Forces in Tampa, Seattle, Houston, and Phoenix, with assistance from the Seattle Police Department. The case is being prosecuted by Assistant U.S. Attorney Thomas Woods and Civil Rights Division Trial Attorney Michael J. Songer, with assistance from National Security Division Trial Attorney David Smith and U.S. Attorney’s Offices in the Middle District of Florida, Southern District of Texas, District of Arizona, and Central District of California.
Member of Fitchburg Latin Kings Chapter Pleads Guilty Drug Distribution ChargesRead the Press Release
BOSTON – A member of the Fitchburg Chapter of the Massachusetts Almighty Latin King and Queen Nation (“Latin Kings”) pleaded guilty today to drug distribution charges.
Dairon Rivera, a/k/a “King Mafia,” 27, pleaded guilty today to one count of conspiracy to distribute and possess with intent to distribute fentanyl. U.S. Senior District Court Judge Rya W. Zobel scheduled sentencing for April 1, 2021. Dairon Rivera was charged in December 2019, at which time he was a member of the Fitchburg Chapter of the Latin Kings.
The Latin Kings are a violent criminal enterprise comprised of thousands of members across the United States. 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.
During the plea proceedings, Dairon Rivera admitted to selling over 40 grams of fentanyl to a cooperating witness in a series of audio/video recorded sales that took place between April and December of 2017.
In December 2019, a federal grand jury returned an indictment alleging racketeering conspiracy, drug conspiracy and firearms charges against 62 leaders, members and associates of the Latin Kings. Dairon Rivera is the 26th defendant to plead guilty in the case.
The charge of conspiracy 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; and Commissioner Carol Mici of the Massachusetts Department of Correction 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. Attorneys Philip A. Mallard and Lauren Graber 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.
This case is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
McPherson County Man Charged with Producing Child PornographyRead the Press Release
WICHITA, KAN. – A man from McPherson County was charged in federal court here today with sexually exploiting a 15-year-old victim, U.S. Attorney Stephen McAllister said.
Loren Olson, 68, Marquette, Kan., is charged with one count of producing child pornography and one count of the sex trafficking of a minor.
A criminal complaint filed in federal court in Wichita alleges Olson came to the attention of law enforcement after Facebook made a CyberTipline report to the National Center for Missing and Exploited Children (NCMEC). Facebook captured content in which Olson communicated with a 15-year-old victim. Olson made reference to having had sex with the victim, taking pictures during their sexual acts and paying the victim after sex.
If convicted, Olson could face a penalty of not less than 15 years and not more than 30 years in federal prison on the production count, and not less than 10 years on the other count. The FBI investigated. Assistant U.S. Attorney Jason Hart is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
Man Pleads Guilty to Fraud Conspiracy Targeting Virginia ABC StoresRead the Press Release
NEWPORT NEWS, Va. – A Norfolk man pleaded guilty today to conspiracy to commit wire fraud and aggravated identity theft as part of a scheme to purchase alcohol for resale from Virginia Alcoholic Beverage Control Authority (ABC) stores with stolen debit and credit card numbers.
According to court documents, Tyrell Jackson, 44, joined together with three other men to defraud Virginia ABC stores by using debit and credit cards re-encoded with the stolen financial information of identity theft victims. Investigators have identified 20 direct victims of identity theft from Jackson’s role in the conspiracy, and at least 82 victims of the broader conspiracy.
Jackson is scheduled to be sentenced on March 24, 2021. The conspiracy to commit wire fraud offense carries a maximum sentence of 30 years in prison, and the aggravated identity theft offense carries a mandatory two years in prison. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia; Peter R. Rendina, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service; Steve R. Drew, Chief of Newport News Police; and Tom Kirby, Chief of Virginia ABC’s Bureau of Law Enforcement made the announcement after Senior U.S. District Judge Henry E. Hudson accepted the plea.
Assistant U.S. Attorney Mack Coleman is prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:20-cr-45.
Lawrence Man Sentenced to Nine Years in Prison for Fentanyl DistributionRead the Press Release
BOSTON – A Lawrence man was sentenced yesterday for distributing fentanyl.
Keysi Batista, 32, was sentenced by U.S. District Court Judge William G. Young to 108 months in prison and four years of supervised release. On Sep. 14, 2020, Batista pleaded guilty to two counts of distribution of 40 grams or more of fentanyl.
Between August 2017 and November 2018, investigators conducted an undercover investigation of Batista’s fentanyl dealing. Over the course of 15 months, investigators conducted two controlled purchases of fentanyl from Batista. Batista was arrested on Nov. 15, 2019.
United States Attorney Andrew Lelling and Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division made the announcement today. The FBI’s North Shore Gang Task Force conducted the investigation.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
Justice Department Files Lawsuit Against the State of Alabama for Unconstitutional Conditions in State's Prisons for MenRead the Press Release
Today, the Justice Department filed suit against the State of Alabama and the Alabama Department of Corrections. The complaint alleges that the conditions at Alabama’s prisons for men violate the Constitution because Alabama fails to provide adequate protection from prisoner-on-prisoner violence and prisoner-on-prisoner sexual abuse, fails to provide safe and sanitary conditions, and subjects prisoners to excessive force at the hands of prison staff.
“The United States Constitution requires Alabama to make sure that its prisons are safe and humane,” said Assistant Attorney General Eric Dreiband for the Civil Rights Division. “The Department of Justice conducted a thorough investigation of Alabama’s prisons for men and determined that Alabama violated and is continuing to violate the Constitution because its prisons are riddled with prisoner-on-prisoner and guard-on-prisoner violence. The violations have led to homicides, rapes, and serious injuries. The Department of Justice looks forward to proving its case in an Alabama federal courtroom.”
“Our office is committed to ensuring that all citizens’ constitutional rights are respected” said Acting U.S. Attorney for the Northern District of Alabama William R. Chambers Jr. “We will continue to work tirelessly to correct the constitutional deficiencies identified by our investigation into the state prison system.”
“The results of the investigation into safety and excessive force issues within Alabama’s prisons are distressing and continue to require real and immediate attention,” said U.S. Attorney for the Middle District of Alabama Louis V. Franklin Sr. “We hope the filing of this complaint conveys the department’s continued commitment to ensuring that the Department of Corrections abides by its constitutional obligations.”
“The COVID-19 pandemic has reminded us that one of the primary responsibilities of government is to keep our citizens safe,” said U.S. Attorney for the Southern District of Alabama Richard W. Moore. “That responsibility extends to citizens incarcerated within Alabama prisons. Our investigation has demonstrated that constitutionally required standards have not been met in Alabama prisons and this must be corrected. I am disappointed that the efforts of both Alabama officials and Department of Justice officials to find appropriate solutions have not resulted in a mutually agreed upon resolution. Our oath as public officials now requires us to follow the Constitution and to pursue justice in the courts.”
The lawsuit is the result of a multi-year investigation into allegations of constitutional violations within Alabama’s prisons for men conducted by the department’s Civil Rights Division and the U.S. Attorney’s Offices for the Northern, Middle, and Southern Districts of Alabama. As required by the Civil Rights of Institutionalized Persons Act (CRIPA), the department provided the state with written notice of the supporting facts for these alleged conditions, and the minimum remedial measures necessary to address them in Notice Reports issued on April 2, 2019 and July 23, 2020. CRIPA authorizes the department to act when it has reasonable cause to believe there is a pattern or practice of deprivation of constitutional rights of individuals confined to correctional facilities operated by or on behalf of state or local government. For over 20 months the department has engaged in negotiations with the state without achieving a settlement that would correct the deficiencies identified by the department’s investigation.
Today’s lawsuit seeks injunctive relief to address deficient conditions identified by the department’s investigation. The complaint contains allegations of unconstitutional conditions of confinement, which must be proven in federal court. The lawsuit does not seek monetary damages.
This investigation was conducted by attorneys with the Special Litigation Section of the Justice Department’s Civil Rights Division and the U.S. Attorney’s Offices for the Northern, Middle, and Southern Districts of Alabama. Individuals with relevant information are encouraged to contact the department by phone at (877) 419-2366 or by email at [email protected].
Additional information about the Civil Rights Division of the Justice Department is available on its website at www.justice.gov/crt.
Justice Department Files Lawsuit Against the State of Alabama for Unconstitutional Conditions in State's Prisons for MenRead the Press Release
BIRMINGHAM, Ala. – Today, Justice Department filed suit against the State of Alabama and the Alabama Department of Corrections. The complaint alleges that the conditions at Alabama’s prisons for men violate the Constitution because Alabama fails to provide adequate protection from prisoner-on-prisoner violence and prisoner-on-prisoner sexual abuse, fails to provide safe and sanitary conditions, and subjects prisoners to excessive force at the hands of prison staff.
“The United States Constitution requires Alabama to make sure that its prisons are safe and humane,” said Assistant Attorney General Eric Dreiband for the Civil Rights Division. “The Department of Justice conducted a thorough investigation of Alabama’s prisons for men and determined that Alabama violated and is continuing to violate the Constitution because its prisons are riddled with prisoner-on-prisoner and guard-on-prisoner violence. The violations have led to homicides, rapes, and serious injuries. The Department of Justice looks forward to proving its case in an Alabama federal courtroom.”
“Our office is committed to ensuring that all citizens’ constitutional rights are respected” stated Acting U.S. Attorney for the Northern District of Alabama William R. Chambers, Jr. “We will continue to work tirelessly to correct the constitutional deficiencies identified by our investigation into the state prison system.”
“The results of the investigation into safety and excessive force issues within Alabama’s prisons are distressing and continue to require real and immediate attention,” U.S. Attorney for the Middle District of Alabama Louis V. Franklin, Sr. “We hope the filing of this complaint conveys the Department’s continued commitment to ensuring that the Department of Corrections abides by its constitutional obligations.”
“The COVID-19 pandemic has reminded us that one of the primary responsibilities of government is to keep our citizens safe,” said U.S. Attorney for the Southern District of Alabama Richard W. Moore. “That responsibility extends to citizens incarcerated within Alabama prisons. Our investigation has demonstrated that constitutionally required standards have not been met in Alabama prisons and this must be corrected. I am disappointed that the efforts of both Alabama officials and DOJ officials to find appropriate solutions have not resulted in a mutually agreed upon resolution. Our oath as public officials now requires us to follow the Constitution and to pursue justice in the courts.”
The lawsuit is the result of a multi-year investigation into allegations of constitutional violations within Alabama’s prisons for men conducted by the department’s Civil Rights Division and the U.S. Attorney’s Offices for the Northern, Middle, and Southern Districts of Alabama. As required by the Civil Rights of Institutionalized Persons Act (CRIPA), the department provided the state with written notice of the supporting facts for these alleged conditions, and the minimum remedial measures necessary to address them in Notice Reports issued on April 2, 2019 and July 23, 2020. CRIPA authorizes the department to act when it has reasonable cause to believe there is a pattern or practice of deprivation of constitutional rights of individuals confined to correctional facilities operated by or on behalf of state or local government. For over 20 months the department has engaged in negotiations with the State without achieving a settlement that would correct the deficiencies identified by the department’s investigation.
Today’s lawsuit seeks injunctive relief to address deficient conditions identified by the department’s investigation. The complaint contains allegations of unconstitutional conditions of confinement, which must be proven in federal court. The lawsuit does not seek monetary damages.
This investigation was conducted by attorneys with the Special Litigation Section of the Justice Department’s Civil Rights Division and the U.S. Attorney’s Offices for the Northern, Middle, and Southern Districts of Alabama. Individuals with relevant information are encouraged to contact the department by phone at (877) 419-2366 or by email at [email protected].
Additional information about the Civil Rights Division of the Justice Department is available on its website at www.justice.gov/crt.
Justice Department Files Lawsuit Against the State of Alabama for Unconstitutional Conditions in State's Prisons for MenRead the Press Release
MOBILE, Ala. - Today, the Justice Department filed suit against the State of Alabama and the Alabama Department of Corrections. The complaint alleges that the conditions at Alabama’s prisons for men violate the Constitution because Alabama fails to provide adequate protection from prisoner-on-prisoner violence and prisoner-on-prisoner sexual abuse, fails to provide safe and sanitary conditions, and subjects prisoners to excessive force at the hands of prison staff.
“The United States Constitution requires Alabama to make sure that its prisons are safe and humane,” said Assistant Attorney General Eric Dreiband for the Civil Rights Division. “The Department of Justice conducted a thorough investigation of Alabama’s prisons for men and determined that Alabama violated and is continuing to violate the Constitution because its prisons are riddled with prisoner-on-prisoner and guard-on-prisoner violence. The violations have led to homicides, rapes, and serious injuries. The Department of Justice looks forward to proving its case in an Alabama federal courtroom.”
“Our office is committed to ensuring that all citizens’ constitutional rights are respected” said Acting U.S. Attorney for the Northern District of Alabama William R. Chambers Jr. “We will continue to work tirelessly to correct the constitutional deficiencies identified by our investigation into the state prison system.”
“The results of the investigation into safety and excessive force issues within Alabama’s prisons are distressing and continue to require real and immediate attention,” said U.S. Attorney for the Middle District of Alabama Louis V. Franklin Sr. “We hope the filing of this complaint conveys the department’s continued commitment to ensuring that the Department of Corrections abides by its constitutional obligations.”
“The COVID-19 pandemic has reminded us that one of the primary responsibilities of government is to keep our citizens safe,” said U.S. Attorney for the Southern District of Alabama Richard W. Moore. “That responsibility extends to citizens incarcerated within Alabama prisons. Our investigation has demonstrated that constitutionally required standards have not been met in Alabama prisons and this must be corrected. I am disappointed that the efforts of both Alabama officials and Department of Justice officials to find appropriate solutions have not resulted in a mutually agreed upon resolution. Our oath as public officials now requires us to follow the Constitution and to pursue justice in the courts.”
The lawsuit is the result of a multi-year investigation into allegations of constitutional violations within Alabama’s prisons for men conducted by the department’s Civil Rights Division and the U.S. Attorney’s Offices for the Northern, Middle, and Southern Districts of Alabama. As required by the Civil Rights of Institutionalized Persons Act (CRIPA), the department provided the state with written notice of the supporting facts for these alleged conditions, and the minimum remedial measures necessary to address them in Notice Reports issued on April 2, 2019 and July 23, 2020. CRIPA authorizes the department to act when it has reasonable cause to believe there is a pattern or practice of deprivation of constitutional rights of individuals confined to correctional facilities operated by or on behalf of state or local government. For over 20 months the department has engaged in negotiations with the state without achieving a settlement that would correct the deficiencies identified by the department’s investigation.
Today’s lawsuit seeks injunctive relief to address deficient conditions identified by the department’s investigation. The complaint contains allegations of unconstitutional conditions of confinement, which must be proven in federal court. The lawsuit does not seek monetary damages.
This investigation was conducted by attorneys with the Special Litigation Section of the Justice Department’s Civil Rights Division and the U.S. Attorney’s Offices for the Northern, Middle, and Southern Districts of Alabama. Individuals with relevant information are encouraged to contact the department by phone at (877) 419-2366 or by email at [email protected].
Additional information about the Civil Rights Division of the Justice Department is available on its website at www.justice.gov/crt.
Jamestown Man Arrested While on New York State Parole Going to Prison Following Crack Cocaine ConvictionRead 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 Earl Stone Jr. a/k/a Ooh Wop, 28, of Jamestown, NY, who was convicted of possession with intent to distribute crack cocaine, was sentenced by U.S. District Judge Richard J. Arcara to serve 32 months in prison.
Assistant U.S. Attorney Meghan E. Leydecker, who handled the case, stated that the defendant was arrested, with another absconding parolee, Shaquelle Coleman, on January 23, 2019, for violating terms of parole. Stone and Coleman were located in the upstairs bedroom of a residence on West 7th Street in Jamestown. Stone had what appeared to be floor insulation from the attic of the residence all over his clothing. During a search of the residence, suspected crack cocaine was located in the attic. A digital scale with white residue and three cellular telephones were also seized. A review of the three cellular telephones recovered several text messages coordinating the sale of narcotics.
Shaquelle Coleman was previously convicted and is scheduled to be sentenced on January 21, 2021.The sentencing is the culmination of an investigation by the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Stephen Belongia; the Jamestown Police Department, under the direction of Chief Timothy Jackson; the New York State Department of Corrections and Community Supervision, under the direction of under the direction of Acting Commissioner Anthony J. Annucci; and the New York State Police, under the direction Major James Hall.
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Jackson Man Sentenced to over 6 Years in Federal Prison for Trafficking MethamphetamineRead the Press Release
Jackson, Miss. – Michael Devell Smith, 28, of Jackson, was sentenced today by U.S. District Judge Henry T. Wingate to 75 months in federal prison and 5 years of supervised release for conspiring to possess with intent to distribute 50 grams or more of methamphetamine, announced U.S. Attorney Mike Hurst and Special Agent in Charge Michelle A. Sutphin with the Federal Bureau of Investigation in Mississippi. Smith was also ordered to pay a $1,500 fine.
From January 2017 to May 2017, Smith sold methamphetamine to buyers, delivering approximately 414 grams of methamphetamine, which was tested and determined to be between 95-99% pure. Smith was indicted on February 6, 2019 as a result of an extensive operation targeting illegal methamphetamine distribution in central Mississippi.
The case was investigated by the Federal Bureau of Investigation, Homeland Security Investigations, Mississippi Bureau of Narcotics, Jackson Police Department, Madison Police Department, Ridgeland Police Department, and the Rankin County Sheriff’s Office. It is being prosecuted by Assistant United States Attorneys Chris Wansley and Keesha Middleton.
Iowa Man Who Used Facebook Messenger to Entice a 12-Year-Old for Sexual Activity Pleads Guilty in Federal CourtRead the Press Release
A man who sought out and enticed a 12-year-old for sexual activity pled guilty today in federal court in Sioux City.
Nathan Landrum, age 40, from Carnarvon, IA, was convicted of enticement of a minor.
In a plea agreement, Landrum admitted that in April 2020, using Facebook Messenger, he knowingly enticed a 12-year-old child to his apartment for sexual activity. Landrum brought the child to his bedroom where he intended to engage in sexual activity with the child.
Sentencing before United States District Court Chief Judge Leonard T. Strand will be set after a presentence report is prepared. Landrum remains in custody of the United States Marshal pending sentencing. Landrum faces a mandatory minimum sentence of 10 years’ imprisonment and a possible maximum sentence of life imprisonment, a $250,000 fine, and 3 years of supervised release following any imprisonment.
The case is being prosecuted by Assistant United States Attorney Ron Timmons and was investigated by the Federal Bureau of Investigation and the Sac County Sheriff’s Office. 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 individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 20-4046.
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Individual Pleads Guilty to Participating in Internet-of-Things Cyberattack in 2016Read the Press Release
An individual, formerly a juvenile, pleaded guilty to committing acts of federal juvenile delinquency in relation to a cyberattack that caused massive disruption to the Internet in October 2016.
Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division, U.S. Attorney Scott W. Murray of the District of New Hampshire, and Special Agent in Charge Joseph R. Bonavolonta of the FBI’s Boston Division made the announcement.
According to the plea agreement, the individual conspired to commit computer fraud and abuse by operating a botnet and by intentionally damaging a computer. Because the individual was a juvenile at the time of the commission of the offense, the individual’s identity is being withheld pursuant to the Juvenile Delinquency Act, see 18 U.S.C. § 5031, et seq. The guilty plea took place in a closed proceeding before Chief Judge Landya B. McCafferty in the District of New Hampshire. Judge McCafferty scheduled the individual’s sentencing for Jan. 7, 2021.
According to unsealed court documents, from approximately 2015 until November of 2016, the individual conspired with others to create and operate one or more online botnets to launch cyberattacks against victim computers (specifically targeting those belonging to online gamers or gaming platforms) in order to take those computers offline altogether or otherwise significantly impair their functionality. These attacks are often referred to as “Distributed Denial of Service” or “DDoS” attacks.
In general, a DDoS attack is a type of cyberattack in which a malicious actor directs a large volume of Internet traffic to a victim computer or network, overwhelming it and rendering it unable to function as intended. Successful DDoS attacks can take individual computer users, websites, or entire computer networks offline altogether or otherwise slow their performance. DDoS attacks are often conducted through the use of botnets (short for “robot networks”), that is, large numbers of compromised computers under the control of an individual or group of actors.
According to court documents, in September and October of 2016, the individual and others created a botnet, which was a variant of the so-called “Mirai” botnet, for use in launching DDoS attacks. Mirai infected “Internet-of-Things” devices, such as Internet-connected video cameras and recorders, and turned them into bots to be used to launch DDoS attacks.
According to court documents, on Oct. 21, 2016, the individual and others used the botnet they created to launch several DDoS attacks in an effort to take the Sony PlayStation Network’s gaming platform offline for a sustained period. The DDoS attacks impacted a domain name resolver, New Hampshire-based Dyn, Inc., which caused websites, including those pertaining to Sony, Twitter, Amazon, PayPal, Tumblr, Netflix, and Southern New Hampshire University (SNHU), to become either completely inaccessible, or accessible only intermittently for several hours that day. As a result of the individual’s DDoS attacks, Dyn, Sony, SNHU, and other entities and individuals suffered losses including lost advertising revenues and remediation costs. Sony estimated that its resultant losses included approximately $2.7 million in net revenue.
This case was investigated by the FBI with assistance from the National Crime Agency and Police Service of Northern Ireland. The case is being prosecuted by Senior Trial Attorney Mona Sedky of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorney Georgiana MacDonald of the District of New Hampshire. Former Assistant U.S. Attorney Arnold H. Huftalen provided substantial assistance.
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.
Indictment: Topeka Man Distributed HeroinRead the Press Release
TOPEKA, KAN. – A Topeka man was indicted in federal court today with distributing heroin, U.S. Attorney Stephen McAllister said.
James Licht, 39, Topeka, Kan., was charged with one count of distributing heroin and one count of unlawful possession of firearms by a previously convicted felon.
According to documents filed in court, in October investigators served a search warrant at Licht’s residence in the 1400 block of SW 5th Street in Topeka. Among the items seized were heroin, more than $1,500 in cash, a .45 caliber pistol, a 9 mm pistol, other firearms and drug paraphernalia.
Licht was paying $1,500 to $2,000 an ounce to buy 1 to 2 ounces of heroin each week.
Licht was prohibited from possessing a firearm due to a felony conviction in 2019 in Shawnee County District Court.
If convicted, he could face up to 20 years in federal prison and a fine up to $1 million on the heroin charge and up to 10 years and a fine up to $250,000 on the firearm charge. The Drug Enforcement Administration and the Kansas Highway Patrol investigated. Special Assistant U.S. Attorney Lindsey Debenham is prosecuting.
OTHER INDICTMENTS
Frederick L. Martin, 25, Sedgwick, Kan., is charged with one count of producing child pornography and one count of committing a crime involving a minor while registered as a sex offender. The crimes are alleged to have occurred in Sedgwick County, Kan., during August through October 2020.
If convicted, he could face a penalty of not less than 35 years and not more than 60 years in federal prison and a fine up to $250,000 on the charge of producing child pornography, and an additional 10 years (consecutive) on the other count. Homeland Security Investigations (HSI) investigated. Assistant U.S. Attorney Jason Hart is prosecuting.
Carlos Ivan Radales-Velasquez, 47, who is not an American citizen, is charged with one count of unlawfully re-entering the United States after being deported. He was found Nov. 22, 2020, in Manhattan, Kan.
If convicted, he could face a penalty of up to 20 years in federal prison and a fine up to $250,000. Immigration and Customs Enforcement investigated. Assistant U.S. Attorney Jared Maag is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
Human Smuggler Sentenced to 15 Years in Prison for Assaulting a Federal OfficerRead the Press Release
Jackson, Miss. – Vicente Lopez-Sanchez, 41, an illegal alien from Mexico, was sentenced today by U.S. District Judge Henry T. Wingate to 180 months in prison, followed by three years of supervised release, for assaulting and inflicting serious bodily injury upon a federal law enforcement officer, announced U.S. Attorney Mike Hurst, Gilbert Trill, Acting Special Agent in Charge of Homeland Security Investigations in New Orleans and Diane Witte, Field Office Director of ICE Enforcement and Removal Operations (ERO).
“Our office has zero tolerance for those who attack and harm our law enforcement. Such criminals can be assured they will receive swift prosecution and severe punishment for their unlawful acts. I commend our federal agents, local police, and prosecutors for ensuring that this criminal was held accountable and that justice prevailed. We will continue to do our part to protect the public and our law enforcement, and to ensure that our laws are enforced,” said U.S. Attorney Hurst.
On August 2, 2018, a Brandon Police officer stopped Lopez-Sanchez for a traffic violation on Interstate I-20. Because Lopez-Sanchez had no driver’s license and could only name one of the four passengers he was transporting, the officer suspected alien smuggling. Lopez-Sanchez then resisted arrest by Brandon police officers and an ICE Deportation Officer. During the fight, Lopez-Sanchez broke a bone in the Deportation Officer’s foot.
Lopez was indicted on August 21, 2018 and charged with assaulting a federal officer. He was found guilty on October 22, 2019 after a two-day trial before Judge Wingate in U.S. District Court in Jackson. Lopez-Sanchez has previously been sentenced for a related offense of illegally reentering the United States following a prior deportation, and has been currently serving that sentence.
The case was investigated by Homeland Security Investigations and Immigration and Customs Enforcement, with assistance from the Brandon Police Department. The case was prosecuted by Assistant United States Attorneys Theodore Cooperstein and Lynn Murray.
Honduran National Previously Convicted of an Aggravated Felony, Pleads Guilty to Illegal ReentryRead the Press Release
NEW ORLEANS – U.S. Attorney Peter G. Strasser announced that ARNULFO FERRERA-ARRAZOLA, age 35, a citizen of Honduras, pleaded guilty on December 8, 2020 before U.S. District Court Judge Wendy B. Vitter today to a one-count indictment for illegal reentry of a removed alien, previously convicted of an aggravated felony.
According to court documents, on or about February 13, 2020, ARNULFO FERRERA-ARRAZOLA was found in the United States after having been officially deported and removed on April 29, 2009. ARNULFO FERRERA-ARRAZOLA was previously convicted on or about December 27, 2007 of an aggravated felony.
ARNULFO FERRERA-ARRAZOLA faces a maximum term of imprisonment of twenty years, a fine of up to $250,000.00, three years supervised release after imprisonment, and a $100 special assessment. Sentencing is scheduled for February 9, 2020 before U.S. District Court Judge Vitter.
U.S. Attorney Strasser praised the work of the United States Department of Homeland Security, Immigration and Customs Enforcement in investigating this matter. Assistant United States Attorney Julia K. Evans is in charge of the prosecution.
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Hazleton Man Sentenced to 65 Months’ Imprisonment for Methamphetamine and Cocaine TraffickingRead the Press Release
SCRANTON—The United States Attorney’s Office for the Middle District of Pennsylvania announced that Juan Elvis Monsanto, age 60, of Hazleton, a citizen of the Dominican Republic, was sentenced on December 8, 2020, to 65 months’ imprisonment by U.S. District Court Judge Robert D. Mariani, for trafficking in cocaine and more than 50 grams of methamphetamine.
According to United States Attorney David J. Freed, Monsanto previously pleaded guilty to possession with intent to distribute more than 50 grams of methamphetamine and cocaine. Monsanto committed the crime in February 2016, in Hazleton.
Judge Mariani also ordered Monsanto to serve four years on supervised release following his prison sentence. Monsanto also faces possible deportation as a result of his conviction.
Monsanto was indicted by a federal grand jury in May 2016, as a result of an investigation by the Drug Enforcement Administration (DEA) and Hazleton Police. Assistant U.S. Attorney Francis P. Sempa prosecuted the case.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
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Greenwich Resident Charged with Federal Offenses Stemming from Alleged Investment Fraud SchemeRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, David Sundberg, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, and Joleen Simpson, Acting Special Agent in Charge of IRS Criminal Investigation in New England, today announced that a federal grand jury in New Haven has returned an indictment charging SAMUEL KLEIN, 64, of Greenwich with offenses stemming from an alleged investment fraud scheme.
The indictment was returned on December 7, 2020. Klein appeared yesterday via videoconference before U.S. Magistrate Judge Holly B. Fitzsimmons and was released on a $500,000 bond.
As alleged in the indictment, Klein made false representations to a victim-investor, including that the victim-investor’s funds would be invested in distressed debt, when Klein knew that all of the investment funds would not be used for the stated purposes. Based on these false representations, the victim-investor wrote a check in the amount of $200,000 to Visual Group LLC, an entity Klein controlled, for the purpose of making a purported investment in distressed debt. Klein caused the check to be transported from New York to Connecticut and deposited into a bank account in the name of Visual Group LLC. Klein subsequently solicited and received an additional $50,010 from the victim-investor by falsely representing that Klein needed to purchase title insurance in approximately that amount.
Klein knew that all of the funds he solicited from the victim-investor would not be used for his stated purposes, and that some of the funds would be utilized by Klein for personal and other expenditures.
The indictment charges Klein with one count of interstate transportation of property taken by fraud and one count of money laundering. Both offenses carry a maximum term of imprisonment of 10 years.
U.S. Attorney Durham stressed that an indictment is not evidence of guilt. Charges are only allegations and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being investigated by the Federal Bureau of Investigation and the Internal Revenue Service – Criminal Investigation Division. The case is being prosecuted by Assistant U.S. Attorney Jennifer Laraia.
Greensburg Physician Sentenced to Prison for Drug Distribution, Health Care Fraud, and Money LaunderingRead the Press Release
PITTSBURGH – A Greensburg physician was sentenced in federal court today for three counts of distribution of buprenorphine, a Schedule III controlled substance; one count of health care fraud; and one count of money laundering, United States Attorney Scott W. Brady announced.
Nabil Jabbour, 69, a physician who previously operated an addiction-treatment practice out of offices in Greensburg and Connellsville, Pennsylvania, was sentenced to twelve months and one day in prison followed by one year of supervised release. Jabbour was also ordered to pay a $75,000 fine and a total of $40,000 in restitution to Medicare and the Pennsylvania Medicaid program. He will also forfeit approximately $17,000 in previously seized cash and casino chips.
"As a physician, Nabil Jabbour took an oath to uphold the ethical standards of his profession; instead, he operated a cash-only business that took advantage of vulnerable patients seeking help for their opioid addiction so that he could spend their money at casinos," said U.S. Attorney Brady. "We will continue our steady pursuit to bring drug-dealing doctors to justice."
"We trust our doctors to carefully and thoughtfully write prescriptions, not use their access to profit off of highly addictive medications meant to treat opioid addiction - an addiction that steals the lives of 12 Pennsylvanians a day," said Attorney General Josh Shapiro. "Dr. Jabbour admitted to unlawfully prescribing buprenorphine on multiple occasions for cash. My office and our partners in law enforcement will continue to hold individuals accountable who recklessly put the lives of others at risk for their own personal gain."
During his plea hearing on October 28, 2019, Jabbour admitted that on three occasions between July 2016 and December 2016 he unlawfully prescribed buprenorphine to undercover law enforcement officers. Buprenorphine is commonly used in the treatment of patients suffering from opioid addiction, and it is sold under the trade names Suboxone, Subutex, or Zubsolv. As Jabbour acknowledged, none of the undercover officers to whom he prescribed buprenorphine suffered from opioid use disorder or otherwise displayed symptoms of withdrawal. Jabbour further admitted that he did not accept insurance from his patients, requiring instead that they pay him in cash—typically $100 for an initial office visit and $80 for each subsequent visit. Although Jabbour did not accept insurance, he admitted that he caused Medicare and Pennsylvania Medicaid, two government-funded healthcare programs, to cover the costs of fraudulent buprenorphine prescriptions that he wrote for his patients. Finally, Jabbour also admitted to one count of money laundering based on a transaction he initiated at the Meadows Casino in July 2016 involving $13,960 in cash derived from his unlawful distribution of buprenorphine.
Pursuant to a written plea agreement, Jabbour also accepted responsibility for unlawfully distributing buprenorphine to undercover officers on fourteen additional occasions, maintaining his office locations in Greensburg and Connellsville as drug-involved premises, and laundering approximately $47,000 in cash from his buprenorphine practice during four additional trips to the Meadows Casino. Jabbour also agreed that he was responsible for between 10,000 and 20,000 dosage units of unlawful buprenorphine prescriptions.
Assistant United States Attorney Eric G. Olshan is prosecuting this case on behalf of the government.
The investigation leading to the filing of charges in this case was conducted by the Western Pennsylvania Opioid Fraud and Abuse Detection Unit, which combines personnel and resources from multiple federal and state agencies to combat the growing prescription opioid epidemic, including the Drug Enforcement Administration, Pennsylvania Office of Attorney General – Medicaid Fraud Control Unit, Internal Revenue Service – Criminal Investigation, and U.S. Department of Health and Human Services – Office of Inspector General. The Pennsylvania State Police, the Pennsylvania Office of the Attorney General – Narcotics Unit, Greensburg City Police, South Greensburg Police, and Westmoreland County Sheriff’s Office also provided assistance during the investigation and prosecution of Jabbour.
Frankfort Man Sentenced to 120 Months for Attempting to Entice a Minor OnlineRead the Press Release
FRANKFORT, Ky. - A Frankfort man, Ricky Joe Cornish Jr., 33, was sentenced to 120 months in prison on Tuesday, by U.S. District Judge Gregory F. Van Tatenhove, after previously pleading guilty to using the internet to entice a minor to engage in sexual activity.
According to his guilty plea agreement, on May 16, 2019, Cornish contacted an individual, who self-identified as a 15-year-old female living in Franklin County, Kentucky, using the MeetMe/Skout messenger application over the Internet, on his cellular telephone. The person Cornish contacted was, in reality, an investigator with the Kentucky Office of the Attorney General’s Cyber Crimes Branch. The investigator communicated that they were also with a 17-year-old female, and Cornish expressed interest in having sex with the 17-year-old.
Later that same day, Cornish drove to an agreed-upon hotel, in order to meet the minor and engage in criminal sexual activity. When Cornish arrived at the agreed-upon meeting place in Franklin County, he was arrested by law enforcement officers. An examination of Cornish’s cell phone revealed the conversation with the investigator, as well as a similar conversation with another individual, who is believed to be a minor female.
Cornish pleaded guilty in July 2020.
Under federal law, Cornish must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the U.S. Probation Office for 20 years.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Ralph Gerds, Assistant Special Agent in Charge, U.S. Secret Service Louisville Field Division; and Daniel Cameron, Attorney General for the Commonwealth of Kentucky, jointly announced the sentencing.
The investigation was conducted by United States Secret Service and Kentucky Attorney General’s Cyber Crimes Branch. The United States was represented by Assistant U.S. Attorneys David Marye and Tashena Fannin.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov
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Former Sales Representative Admits Role in Compounded Prescription Drug SchemeRead the Press Release
NEWARK, N.J. – A former sales representative today admitted his role in a scheme to defraud a New Jersey state health benefits program, U.S. Attorney Craig Carpenito announced.
Thomas Bowers, 46, of Little Falls, New Jersey, pleaded guilty by videoconference before U.S. District Judge William J. Martini to an information charging him with conspiracy to commit health care fraud.
According to documents filed in this case and statements made in court:
Compounding is a practice in which a pharmacist or physician combines, mixes, or alters ingredients of a drug to create a medication tailored to the needs of an individual patient. The Food and Drug Administration does not approve compounded drugs and thus does not verify the safety, potency, effectiveness, or manufacturing quality of compounded drugs. Generally, a physician may prescribe compounded drugs when an FDA-approved drug does not meet the health needs of a particular patient.
Between December 2014 and March 2016, Bowers worked as a sales representative for a marketing company that marketed and sold compounded drugs to physicians, including pain, scar and wound creams and certain supplements and vitamins. Certain compounding pharmacies paid the marketing company based on a percentage of the reimbursement payments they received from health care benefit programs for each prescription that Bowers referred to the pharmacies. The marketing company, in turn, paid Bowers based on the compounded prescriptions he generated. Bowers recruited patients, including family members, who had prescription drug coverage under the New Jersey School Employee’s Health Benefits Program, to obtain medically unnecessary prescriptions for compounded drugs. Bowers paid patients that he recruited to obtain prescriptions from doctors even though the doctors did not have any interaction with the patients for purposes of determining that a prescription was medically necessary. He obtained medically unnecessary prescriptions from doctors who only conducted a cursory patient examination that was insufficient to legitimately deem that a compounded drug was medically necessary for the patient.
The count of conspiracy to commit health care fraud carries a maximum penalty of 10 years in prison and a $250,000 fine, or twice the gain or loss from the offense, whichever is greater. As part of his plea agreement, Bowers must forfeit $157,747 in criminal proceeds and pay restitution of at least $593,678. Sentencing is scheduled for April 8, 2021.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark, and Defense Criminal Investigative Service, under the direction of Special Agent in Charge Patrick J. Hegarty, with the investigation leading to today’s plea.
The government is represented by Assistant U.S. Attorney Adam Baker of the United States Attorney’s Office, Opioid Abuse Prevention and Enforcement Unit in Newark.
Former Member of Boston Latin Kings Chapter Sentenced for Racketeering ConspiracyRead the Press Release
BOSTON – A former member of the Boston-based Devon Street Kings Chapter of the Massachusetts Almighty Latin King and Queen Nation (“Latin Kings”) was sentenced today on racketeering charges. The defendant admitted to shooting in the direction of another Latin Kings member in June 2019.
Juan Figueroa, a/k/a “King Pun,” 25, was sentenced by U.S. Senior District Court Judge Rya W. Zobel to two years in prison and three years of supervised release. In September 2020, Figueroa pleaded guilty to conspiracy to conduct enterprise affairs through a pattern of racketeering activity, more commonly referred to as RICO conspiracy. Figueroa was arrested and charged in December 2019, at which time he was a member of the Devon Street Kings, a Boston-based Chapter of the Latin Kings, and had formerly been a member of the New Bedford Chapter.
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.
Figueroa admitted to participating in a June 2019 shooting in which he shot in the direction of a Latin Kings member who was in bad standing with the gang. Figueroa further admitted to creating numerous songs and accompanying music videos that served as compelling propaganda for the gang. Producing music under the name, “The Almighty King Pun,” Figueroa’s songs and music videos depicted the gang members brandishing firearms, boasting about their proclivity for violence and describing the scope of their successful drug distribution operations. The music videos featured groups of Latin Kings members wearing gang colors, clothing and symbols, and throwing up gang signs. The lyrics of these music videos taunted and threatened rival gang members.
In December 2019, a federal grand jury returned an indictment alleging racketeering conspiracy, drug conspiracy and firearms charges against 62 leaders, members and associates of the Latin Kings. Figueroa is the seventh defendant to be sentenced in the case.
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; Boston Police Commissioner William Gross; and New Bedford Police Chief Joseph C. Cordeiro 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 Lauren Graber 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.
This case is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) operation. OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
Former Founder and CEO of Nanotechnology Company Charged in Manhattan Federal Court 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, and William F. Sweeney Jr., Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced that JAMES JEREMY BARBERA, the former founder and chief executive officer of a nanotechnology company based in New York, New York, was arrested this morning in New York on securities fraud and wire fraud charges stemming from a scheme to defraud investors in the company. Among other illicit activity, BARBERA fraudulently induced dozens of investors to invest at least approximately $12.2 million based on false and misleading statements, by failing to use investors’ funds as promised, and by converting investors’ money to his own use. BARBERA will be presented this afternoon in Manhattan federal court before U.S. Magistrate Judge Sarah Netburn.
Acting U.S. Attorney Audrey Strauss said: “As alleged, James Barbera defrauded investors out of millions of dollars by offering the opportunity to invest in a seemingly plausible but wholly fictitious technology, purportedly developed in coordination with NASA. Barbera allegedly further misled investors with false statements about institutional investors, licensing agreements, an imminent IPO, and other lies, and misappropriated investor money for his own use. Now he is in custody and facing prosecution for his alleged crimes.”
FBI Assistant William F. Sweeney Jr. said: “As we allege today, Barbera, in his position as founder and CEO of a privately-held nanotechnology company, fraudulently collected more than $12 million from investors and used approximately half the money to pay for personal expenses including private school and college tuition for his children and mortgage payments on his Central Park West apartment. Among other misrepresentations he made, Barbera claimed his company had an exclusive relationship with NASA and even used NASA’s logo to solicit investors. As we demonstrated today, Barbera’s non-existent ‘exclusive’ landed him nothing more than a trip through the federal criminal justice system.”
According to the allegations in the Complaint unsealed today in Manhattan federal court:[1]
Between in or about 2009 and in or about 2019, BARBERA was the founder and CEO of a privately held nanotechnology company that represented to investors that the company had developed a breathalyzer sensor technology that could detect cancer and narcotics in human breath, based on technology developed by the National Aeronautics and Space Administration (“NASA”), and that it was also partnered with a major U.S. research university.
From at least in or about 2013 through in or about 2020, BARBERA and others perpetrated a scheme to defraud dozens of investors out of at least approximately $12.2 million (i) by soliciting investments in the company’s equity and notes through false and misleading statements, (ii) by failing to use investors’ funds as promised, and (iii) by converting investors’ money to his own use. BARBERA and others made false and misleading representations to actual and potential investors, including as set forth below:
BARBERA falsely represented that the company had developed a breathalyzer sensor, based on technology developed by NASA, that could detect narcotics and cancer from a person’s breath. In truth and in fact, and as BARBERA well knew, the company and NASA never developed such a technology. Indeed, NASA conducted no research for the company related to this technology after in or about late 2017, and NASA did not permit research related to narcotics testing at NASA facilities.
BARBERA falsely represented that the company had an exclusive license with NASA for certain patents related to a breathalyzer sensor technology for the life of the patents, and used NASA’s name and logo to solicit investors in the company. In truth and in fact, and as BARBERA well knew, the company did not have an exclusive license with NASA.
BARBERA falsely represented to potential and actual investors that institutional investors, including a large, publicly traded chemical company, had made substantial investments in the company. In truth and in fact, and as BARBERA well knew, that institutional investor never invested in the company.
BARBERA falsely represented that the company would soon have an initial public offering (“IPO”), which would result in large profits to investors. In truth and in fact, and as BARBERA well knew, the company was not close to an IPO.
BARBERA converted to his own use approximately 50 percent of the approximately $12.2 million in investor funds in the form of cash withdrawals and to pay personal expenses, including private school and college tuition for his children, mortgage payments on his Central Park West apartment, and for his other personal items, such as credit card bills, jewelry, automobiles, and daily living expenses.
Previously, BARBERA was the CEO of a publicly traded company. On or about July 29, 2014, the U.S. Securities and Exchange Commission (“SEC”) announced the settlement of federal securities fraud charges against BARBERA and that company for making materially false and misleading statements about the true business operations and finances of that company. As part of that settlement, BARBERA was permanently enjoined from future violations of the antifraud provisions of the federal securities laws, and agreed to pay a $100,000 penalty and to be permanently barred from acting as an officer or director of a public company.
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BARBERA, 64, was arrested this morning at his home in New York, New York. BARBERA was charged with one count of securities fraud and one count of wire fraud, each of which carries a maximum sentence of 20 years in prison. He was also charged with one count of conspiracy to commit securities fraud and wire fraud, which carries a maximum sentence of five years in prison. The charges carry a maximum fine of $5 million, or twice the gross gain or loss from the offenses. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Ms. Strauss praised the outstanding work of the FBI and NASA’s Office of Inspector General, and also thanked the SEC for its 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.
The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the texts of the Complaint and the descriptions of the Complaint set forth below constitute only allegations, and every fact described should be treated as an allegation.
Former Chief Operating Officer Who Defrauded Asset Management Company and Its Clients Sentenced to 3 Years in PrisonRead the Press Release
Audrey Strauss, the Acting United States Attorney for the Southern District of New York, announced that RICHARD DIVER was sentenced on December 7 to 36 months in prison in connection with his embezzlement from the asset management company where he served as chief operating officer. DIVER previously pled guilty to investment adviser fraud in connection with his fraudulently overbilling the company’s clients by hundreds of thousands of dollars and rerouting those funds into his personal account, and wire fraud for diverting millions of dollars in the company’s payroll to which he was not entitled to his personal account over a period of several years. U.S. District Judge Loretta A. Preska, who accepted DIVER’s guilty plea, imposed the sentence in Manhattan federal court.
Manhattan U.S. Attorney Audrey Strauss said: “Richard Diver stole five million dollars, first by defrauding his employer over several years, and then – as if those millions were not enough – turning to the firm’s clients and lining his pockets with excess billings. This sentence should serve as a reminder that this kind of fraud and abuse will not be tolerated.”
According to statements in the Indictment and Complaint in this case, and statements made in public court proceedings:
DIVER was the chief operating officer (“COO”) of a Manhattan-based asset management company (“Company-1”) that offers its customers investment planning and wealth management services. As COO, DIVER’s responsibilities included overseeing the company’s payroll and billing functions, and he had unfettered access to the payroll controls.
Beginning in 2011 and continuing into December 2018, DIVER fraudulently caused Company-1’s third-party payroll vendor to pay him salary significantly beyond his authorized salary and bonus. Over that period, DIVER caused over $4.5 million to be routed to his personal checking account above and beyond his approved compensation.
In 2017, DIVER began to also defraud Company-1’s clients. Typically, Company-1 billed its clients quarterly, in most cases having been authorized by the clients to deduct its investment advisory fees directly from their custodial accounts. DIVER began to cause an employee to run the billing process, which was based on a fixed percentage of the assets the clients had under the company’s management, at off-cycle intervals as to certain clients in addition to the regular quarterly intervals at which it billed legitimately. These billings were not accompanied by any notice. The clients affected by this practice therefore had their accounts debited twice, but were only notified of the single legitimate billing in periodic reports and correspondence from the company. DIVER routed the excess funds to his own personal bank accounts through the company’s payroll system. Through this mechanism, DIVER defrauded the clients of over $700,000.
In December 2018, certain clients noticed the overbilling and complained to Company-1’s president, who confronted him. DIVER admitted to both fraudulent practices, stating that the funds he had stolen were consumed by his own “wild” spending. Prior to his arrest, law enforcement agents recorded a conversation in which DIVER acknowledged having defrauded the company of $4.5 million through the payroll fraud and certain clients of over $700,000 through the billing fraud.
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DIVER, 64, of New York New York, was also sentenced to a three-year term of supervised release. He was further ordered to forfeit $5,248,197 and pay an additional $5,248,197 in restitution to his former employer.
Ms. Strauss praised the investigative work of the U.S. Postal Inspection Service and thanked the New York Regional Office of the U.S. Securities and Exchange Commission, which separately filed civil charges against DIVER.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant United States Attorney Martin S. Bell is in charge of the prosecution.