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Friday 25 September 2020
U.S. Attorney Scott W. Murray Announces Results in Fight Against the Opioid Crisis Two Years After Launch of Operation S.O.S.Read the Press Release
Concord – In July 2018, the Department of Justice announced the launch of Operation Synthetic Opioid Surge (S.O.S), a program aimed at reducing the supply of synthetic opioids in 10 high impact areas, including the District of New Hampshire and identifying wholesale distribution networks and international and domestic suppliers.
Under Operation SOS, the United States Attorneys in 10 districts with some of the highest drug overdose death rates in the country each designated a county where they would focus on prosecuting every readily available case involving fentanyl, fentanyl analogues, and other synthetic opioids, regardless of the drug quantity.
“The Justice Department’s commitment to fighting the opioids epidemic is stronger than ever, and we are using every tool in our arsenal to disrupt the supply of these drugs on our streets,” said Deputy Attorney General Jeffrey A. Rosen. “Operation SOS has had a significant positive impact on the communities where it is being employed. The Department will continue to build on these successes and work to stop the drug traffickers who so callously wreck lives.”
“Since the initiation of Operation SOS in New Hampshire, approximately 93 separate defendants have been charged with drug trafficking offenses in federal court,” said U.S. Attorney Murray. “By taking aggressive action against drug traffickers in Hillsborough County, Operation SOS is limiting the supply of fentanyl and other drugs in the community and helping to reduce the overdose death rate in that county. We also are sending a message to drug dealers that their dangerous and unlawful conduct will not be tolerated. We will continue to work with the Manchester and Nashua Police Departments, the Hillsborough County Attorney’s Office, the Drug Enforcement Administration, and all of our law enforcement partners in Hillsborough County to identify and prosecute the drug dealers who are damaging the quality of life in the Granite State.”
Numerous significant drug traffickers have been prosecuted under Operation SOS, including the following:
- Jai Britt, 45, of Manchester was sentenced to ten years in federal prison for trafficking in fentanyl, cocaine, heroin, and crack cocaine. Britt, who was selling drugs while on probation and wearing an ankle monitor, engaged in a hand-to-hand fentanyl transaction with a cooperating individual. A search warrant of his residence later yielded over 135 grams of crack cocaine, 194 grams of cocaine, and 1.5 grams of heroin.
- Richard Rowell, 47, of Nashua was sentenced to nine years in federal prison for trafficking crack cocaine while he was on bail for a state offense. Evidence in the case showed that Rowell, who had multiple prior drug trafficking convictions, also had been trafficking crack cocaine and fentanyl.
Several significant Operation SOS matters are pending trial, including the following:
- Jonathan Sargent, 37, of Manchester, has been charged with two counts of distributing fentanyl, one count of possessing methamphetamine and fentanyl with intent to distribute, possession of firearms in furtherance of drug trafficking, and possession of firearms by a convicted felon.
- Robert Audette, 30, of Manchester, has been charged with one count of distributing methamphetamine, two counts of distributing fentanyl, one count of possessing fentanyl with intent to distribute, one count of possession of a firearm in furtherance of drug trafficking, and one count of possession of a firearm by a convicted felon.
Nationally, since 2018, Operation SOS has resulted in approximately 750 defendants being charged in federal court, with 384 of those defendants charged thus far in FY 20. Most importantly, the districts participating in the program have seen a decline in opioid overdoses. From 2017 to 2019, most SOS counties reported a decline of 14% to 24%. One notable success was in the Western District of Pennsylvania, where the opioid overdose rates declined by nearly 45%.
The nine other participating districts and some of their successes are listed below:
- The Eastern District of California has reported 60 active Operation S.O.S. investigations. Recently, the USAO charged one sentence-enhanced “death resulting” prosecution. In February 2020, another investigation resulted in the seizure of over 20,000 fentanyl-laced counterfeit oxycodone pills.
- The Eastern District of Kentucky reported that an SOS investigation led to a residential search warrant and seizure of more than 1,300 grams of fentanyl, more than 500 grams of methamphetamine, $15,000 cash, two firearms, and paraphernalia used to traffic narcotics including a device for pressing fentanyl into a brick-like shape
- The District of Maine reported a July 2020 arrest of a defendant on charges of distributing counterfeit fentanyl pills marked as Percocet, in connection with a fatal fentanyl overdose that occurred in May 2020. In addition, a Maine man was sentenced in February 2020 to five years in prison for two counts of possession with intent to distribute fentanyl, in connection with an incident where the defendant was found in possession of fentanyl less than 24 hours after he was released on a state summons for possession of fentanyl.
- The Northern District of Ohio reported a 10-defendant wire case involving a drug trafficking organization (DTO) operating out of Elyria and Sandusky, Ohio. The DTO purchased kilogram quantities of cocaine and oxycodone pills. Co-conspirators would later cook the cocaine and sell it as crack to local dealers in Elyria. During the conspiracy, agents seized approximately ½ kilo of cocaine, 100 grams of crack, oxycodone pills, and five firearms.
- The Southern District of Ohio reported the arrest of an individual who had previously served a nine-year state prison sentence for drug trafficking. On October 22, 2019, after law enforcement observed activity consistent with drug transactions, including the delivery of what appeared to be a kilogram of narcotics by a courier, members of the FBI Safe Streets Task Force executed a search warrant at a residence in Dayton, Ohio, where they located three firearms, 1,205 grams of methamphetamine, 1,716 grams of fentanyl, 305 grams of heroin, drug processing equipment, and 12 cellular telephones. One of the recovered cellular telephones contained photographs of multiple kilograms of fentanyl and communications with a narcotics supplier. Through subsequent investigation, law enforcement recovered an additional 19.5 kilograms of fentanyl/carfentanil.
- The Western District of Pennsylvania prosecuted 98 SOS cases thus far in FY 2020. Particularly noteworthy among them is the prosecution of Lynell Guyton. Guyton was convicted by a jury of conspiracy to distribute 100 grams or more of cyclopropyl fentanyl and other charges, including firearms and money laundering violations. Guyton, who had been receiving shipments of fentanyl analogues from China, is both a Career Offender and an Armed Career Criminal. The case gained media attention when, during the execution of a search warrant in connection with the charges, the conspirators tipped over a table, sending cyclopropyl fentanyl into the air, sickening several law enforcement officers on the scene.
- The Eastern District of Tennessee reported multiple cases arising out of a single investigation involving a drug trafficking organization responsible for trafficking heroin and fentanyl from Michigan to various communities in the Eastern District of Tennessee. 29 defendants have been indicted on various charges, including drug trafficking conspiracy, overdose death enhancements, money-laundering conspiracy, and various firearms offenses. More than 5.5 kilograms of heroin and/or fentanyl and 11 firearms were seized during the investigation.
- The Northern District of West Virginia reported a July 21, 2020, forty-four count indictment against 12 defendants. During the nearly yearlong investigation, law enforcement officers seized more than 280 grams of cocaine base and more than 40 grams of fentanyl from one of the defendant’s residences in Harpers Ferry, West Virginia. Throughout the investigation, officers seized more than 280 grams of fentanyl, acetyl fentanyl, and heroin; more than 350 grams of cocaine base; more than one kilogram of liquid PCP; various amounts of cocaine; five firearms; and over $28,000.
- The Southern District of West Virginia reported that after a three-day trial, a jury convicted Steven McCallister of distribution of fentanyl, possession with the intent to distribute fentanyl, being a felon in possession of a firearm, and possession of a firearm in furtherance of drug trafficking. Officers conducted a 50-gram purchase of heroin from McCallister, which then led to the execution of a search warrant at McCallister’s home. Officers seized over one kilogram of fentanyl and a firearm.
The charges and allegations contained in an indictment are simply an allegation. All defendants are presumed innocent unless and until proven guilty.
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- Jai Britt, 45, of Manchester was sentenced to ten years in federal prison for trafficking in fentanyl, cocaine, heroin, and crack cocaine. Britt, who was selling drugs while on probation and wearing an ankle monitor, engaged in a hand-to-hand fentanyl transaction with a cooperating individual. A search warrant of his residence later yielded over 135 grams of crack cocaine, 194 grams of cocaine, and 1.5 grams of heroin.
U.S. Attorney J. Douglas Overbey Announces $142,139 in Department of Justice Grant Awards for Project Safe Neighborhoods in East TennesseeRead the Press Release
KNOXVILLE, Tenn. – United States Attorney J. Douglas Overbey of the Eastern District of Tennessee announced today that $142,139 was awarded in Department of Justice grants to Project Safe Neighborhoods in East Tennessee.
The goal of this funding is to implement effective programs and strategies that enable PSN task forces to prevent, respond to, and reduce violent crime; effectively use intelligence and data to identify high-crime areas and prolific violent offenders; foster collaboration with affected communities; and create and maintain ongoing coordination among federal, state, local, and tribal law enforcement officials.
“The Eastern District of Tennessee is committed to the PSN program and its proven results. Our district has a strong track record of working with our federal, state and local partners to prosecute cases aimed at reducing violent crime in our communities. This funding will only enhance our current PSN program and will serve as a larger anti-crime strategy platform,” said U.S. Attorney Overbey.
Project Safe Neighborhoods (PSN) is designed to create and foster safer neighborhoods through a sustained reduction in violent crime. The program's effectiveness depends upon the ongoing coordination, cooperation, and partnerships of local, state, tribal, and federal law enforcement agencies working together with the communities they serve. Agencies have the ability to apply for remaining allocations through this consolidated block grant.
- Elizabethton Police Department - $41,880
- Knoxville Police Department - $69,000
- Hancock Co. Sheriff’s Department - $23,586
- Chattanooga Police Department - $7,673
There are five core components to the PSN strategy: strategic planning, partnerships, training, outreach and accountability. Initially, PSN increased partnerships among federal, state, and local law enforcement agencies through the formation of a local gun crime enforcement task force. Additional partnerships were established with local governments, social service providers, and community groups to increase resources for prevention efforts, and to increase the legitimacy of law enforcement interventions.
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U.s. Attorney Halsey Frank Reports on Operation S.o.s. Two Years After Its LaunchRead the Press Release
PORTLAND, Maine – In July 2018, the Department of Justice launched Operation Synthetic Opioid Surge (S.O.S), a program aimed at reducing the supply of synthetic opioids in 10 high-impact areas, including the District of Maine. Under Operation S.O.S., the United States Attorneys in 10 districts with some of the highest drug overdose death rates in the country designated a county where they would prosecute cases involving fentanyl, fentanyl analogues and other synthetic opioids, regardless of the drug quantity.
“The Justice Department’s commitment to fighting the opioids epidemic is stronger than ever, and we are using every tool in our arsenal to disrupt the supply of these drugs on our streets,” said Deputy Attorney General Jeffrey A. Rosen. “Operation S.O.S. has had a significant positive impact on the communities where it is being employed. The Department will continue to build on these successes and work to stop the drug traffickers who so callously wreck lives.”
“Operation S.O.S. Maine has helped the US Attorney’s Office play our role in the group effort to combat the opioid crisis that has so plagued our community by interdicting deadly synthetic opioids and prosecuting the individuals who distribute them in the State of Maine,” said U.S. Attorney Frank. “Every day our federal, state and local law enforcement partners are working together to bring these dealers to justice.”
For example, in Maine, a man was arrested in July 2020 for distributing counterfeit fentanyl pills marked as Percocet, in connection with a fatal fentanyl overdose that occurred in May 2020. In February 2020, another Maine man was sentenced to five years in prison for two counts of possession with intent to distribute fentanyl, in connection with an incident where the defendant was found in possession of fentanyl less than 24 hours after he was released on a state summons for possession of fentanyl.
Overall, the U.S. Attorney’s Office for the District of Maine has prosecuted 75 individuals under Operation S.O.S. since the initiative began in 2018. Nationally, since 2018, Operation S.O.S. has resulted in approximately 750 defendants being charged in federal court, with 384 of those defendants charged thus far in FY 20.
The nine other participating districts and some of their successes are listed below:
- The Eastern District of California reported 60 active Operation S.O.S. investigations. Recently, the USAO charged one sentence-enhanced “death resulting” prosecution. In February 2020, another investigation resulted in the seizure of over 20,000 fentanyl-laced counterfeit oxycodone pills.
- The Eastern District of Kentucky reported that an S.O.S. investigation led to a residential search warrant and seizure of more than 1,300 grams of fentanyl, more than 500 grams of methamphetamine, $15,000 cash, two firearms, and paraphernalia used to traffic narcotics including a device for pressing fentanyl into a brick-like shape.
- The District of New Hampshire reported the October 2019 arrest of a man on a warrant for distributing fentanyl. Manchester Police detectives executed a search warrant on a local drug-house, where they located approximately 850 grams of methamphetamine and 56 grams of fentanyl, several assault-style rifles, a handgun, ammunition, scales, safes, cash and cellphones.
- The Northern District of Ohio reported a 10-defendant wire case involving a drug trafficking organization (DTO) operating out of Elyria and Sandusky, Ohio. The DTO purchased kilogram quantities of cocaine and oxycodone pills. Co-conspirators would later cook the cocaine and sell it as crack to local dealers in Elyria. During the conspiracy, agents seized approximately ½ kilo of cocaine, 100 grams of crack, oxycodone pills and five firearms.
- The Southern District of Ohio reported the arrest of an individual who had previously served a nine-year state prison sentence for drug trafficking. On October 22, 2019, after law enforcement observed activity consistent with drug transactions, including the delivery of what appeared to be a kilogram of narcotics by a courier, members of the FBI Safe Streets Task Force executed a search warrant at a residence in Dayton, Ohio. They located three firearms, 1,205 grams of methamphetamine, 1,716 grams of fentanyl, 305 grams of heroin, drug processing equipment and 12 cellular telephones. One of the recovered cellular telephones contained photographs of multiple kilograms of fentanyl and communications with a narcotics supplier. Through subsequent investigation, law enforcement recovered an additional 19.5 kilograms of fentanyl/carfentanil.
- The Western District of Pennsylvania reported prosecuting 98 S.O.S. cases thus far in FY 2020. Particularly noteworthy among them is the prosecution of Lynell Guyton. A jury found Guyton guilty of conspiracy to distribute 100 grams or more of cyclopropyl fentanyl and other charges, including firearms and money laundering violations. Guyton, who had been receiving shipments of fentanyl analogues from China, is both a Career Offender and an Armed Career Criminal. The case gained media attention when, during the execution of a search warrant in connection with the charges, the conspirators tipped over a table, sending cyclopropyl fentanyl into the air, sickening several law enforcement officers on the scene.
- The Eastern District of Tennessee reported multiple cases arising out of a single investigation involving a drug trafficking organization responsible for trafficking heroin and fentanyl from Michigan to various communities in the Eastern District of Tennessee. 29 defendants have been indicted on various charges, including drug trafficking conspiracy, overdose death enhancements, money-laundering conspiracy and various firearms offenses. More than 5.5 kilograms of heroin and/or fentanyl and 11 firearms were seized during the investigation.
- The Northern District of West Virginia reported a July 21, 2020 44-count indictment against 12 defendants. During the nearly yearlong investigation, law enforcement officers seized more than 280 grams of cocaine base and more than 40 grams of fentanyl from one of the defendants’ residences in Harpers Ferry, West Virginia. Throughout the investigation, officers seized more than 280 grams of fentanyl, acetyl fentanyl, and heroin; more than 350 grams of cocaine base; more than one kilogram of liquid PCP; various amounts of cocaine; five firearms; and over $28,000.
- The Southern District of West Virginia reported that after a three-day trial, a jury convicted Steven McCallister of distribution of fentanyl, possession with the intent to distribute fentanyl, being a felon in possession of a firearm and possession of a firearm in furtherance of drug trafficking. Officers conducted a 50-gram purchase of heroin from McCallister, which then led to the execution of a search warrant at McCallister’s home. Officers seized over one kilogram of fentanyl and a firearm.
Two Sentenced in Scheme to Fraudulently Obtain Licenses for Massage TherapyRead the Press Release
DENVER – United States Attorney Jason R. Dunn announced that two individuals, including a Chinese national, were sentenced for wire fraud in a scheme to falsify education credentials to obtain massage therapy licenses. The Denver Division of the FBI joined in this announcement.
Yongbo Shen, a/k/a Kevin Shen, age 49, who is originally from China and currently from Massachusetts, was sentenced to serve 15 months in prison for his role as the leader of the scheme. Co-defendant Marla Daniels, age 51, of Oklahoma City, was sentenced to serve 3 years of probation, including 8 months of home detention.
According to court documents, between February 16, 2015, and March 3, 2018, Shen and Daniels fraudulently obtained the questions and answers to the exam that Colorado requires for applicants to become a massage therapist. With the help of others, Shen then caused the questions and answers to be translated from English to Chinese – essentially creating an unauthorized question and answer key -- or cheat sheet -- for the examination. As part of the scheme, Shen then distributed the cheat sheet to multiple applicants in exchange for a fee. This allowed otherwise unqualified applicants to pass the test and provided them with an unfair competitive advantage over other persons taking the test.
Daniels and Shen also created and issued multiple bogus diplomas, which falsely certified that certain applicants for the state license had successfully completed the requisite 500 hours of instruction and training from a massage therapy program and had graduated from the Majestic Massage Therapy school. As part of the fraud, Shen worked with Daniels to help create and falsify course transcripts and diplomas.
Shen would submit applications for massage therapy licenses to the State of Colorado Department of Regulatory Affairs on behalf of applicants. In the course of submitting the applications, Shen falsely certified that the information contained within the applications was true and correct, when in fact, Shen knew the applications contained false information regarding the applicants’ educational qualifications and examination requirements.
“Falsifying credentials, regardless of the industry, is criminal, and those responsible will be held accountable,” said U.S. Attorney Jason Dunn. “The defendants in this case certified unqualified individuals to practice massage therapy, leaving those who use those services vulnerable.”
“The FBI is committed to protecting consumers from those who seek to falsify licensing processes for personal gain,” said FBI Denver Special Agent in Charge Michael Schneider. “We will continue to work collaboratively with our federal, state, and local regulatory and law enforcement partners to identify and hold accountable individuals who exploit our business licensing guidelines at the expense of the American people.”
Daniels and Shen were prosecuted by Assistant U.S. Attorney Tim Neff. The sentence was pronounced by U.S. District Court Judge Robert E. Blackburn on September 16, 2020. This case was investigated by the FBI Denver Division with substantial assistance from the FBI Kansas City Division, the FBI Oklahoma City Division, the Arvada Police Department, the Colorado State Patrol, the Wheat Ridge Police Department, Lakewood Police Department, Aurora Police Department and the Denver Police Department.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the District of Colorado. Related court documents can be found on PACER. The defendants case number is 19-cr-263.
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.
Two Men Indicted for Armed Convenience Store RobberiesRead the Press Release
NORFOLK, Va. – A federal grand jury returned an indictment late yesterday charging two men with the armed robbery of multiple convenience stores in the Hampton Roads region.
According to the allegations in the indictment, Darrius Ford, 19, of Portsmouth, and Daniel Zeigler-Irizarry, Jr., 21, of Norfolk, robbed several convenience stores of cash and commercial products in the cities of Hampton, Newport News, Portsmouth, and Chesapeake. Unbeknownst to Ford and Zeigler-Irizarry, during the final robbery, a tracker was embedded in the stolen money. Using the signal emitted from that tracker, Newport News Police located the defendants in a stolen vehicle and attempted to initiate a traffic stop. Ford and Zeigler-Irizarry led police on a high-speed pursuit before crashing. Both were apprehended a short distance away from the scene of the crash.
Ford and Zeigler-Irizarry, Jr. are charged with conspiracy to interfere with commerce by means of robbery, seven counts of interference and attempted interference with commerce by means of robbery, and six counts of using a firearm during a crime of violence. If convicted, Ford and Zeigler-Irizarry, Jr. face a mandatory minimum sentence of 42 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.
This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia; Mark Herring, Attorney General of Virginia; Martin Culbreth, Special Agent in Charge of the FBI’s Norfolk Field Office; Angela Greene, Chief of Portsmouth Police; Col. K.L. Wright, Chief of Chesapeake Police; Terry L. Sult, Chief of Hampton Police Division; and Steve R. Drew, Chief of Newport News Police, made the announcement. Special Assistant U.S. Attorney Kristin G. Bird and Assistant U.S. Attorney Sherrie S. Capotosto are prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:20-cr-87.
Two Men Accused of Fraud Against Warm Springs TribeRead the Press Release
PORTLAND, Ore.—U.S. Attorney Billy J. Williams announced today that two men have been charged with Fraud crimes against the Confederated Tribes of Warm Springs, Oregon.
A federal grand jury in Portland has returned a 6 count indictment charging Roderick Ariwite, age 65, a resident on the Fort Hall Reservation in Idaho, and Thomas Adams, age 48, a resident on the Warm Springs Reservation, with Conspiracy and Theft/Misapplication of Funds from a Tribal Organization. This indictment charges Ariwite and Adams with conspiring to misappropriate $93,700 of tribal funds and with five counts of substantive misappropriation of tribal funds.
In a separate indictment, Ariwite is charged alone with Interstate Transportation of Security Taken by Fraud. This indictment alleges interstate transportation of a $23,000 check Ariwite obtained by fraud from a board member of a tribal business entity.
According to the indictments, Ariwite was CEO of the Warm Springs Economic Development Corporation (WSEDC) d/b/a Warm Springs Ventures (WSV). WSV operates as the management organization for several tribal business ventures. One of those ventures is the Warm Springs Construction Enterprise (WSCE). WSCE bids on and executes construction projects like building roads and commercial buildings. Thomas Adams was Manager of WSCE, under the supervision of Ariwite.
The indictment against Ariwite and Adams alleges that beginning in October 2017, Ariwite and Adams created their own construction company called Warbonnet Construction Services. Thereafter, and on tribal time, while drawing tribal salaries and travel reimbursements, they engaged in work projects for Warbonnett. The indictment alleges that in one instance Ariwite and Adams used $48,900 in tribal funds to hire a subcontractor for a Warbonnet construction project.
The indictment also alleges Ariwite and Adams hired REDD, a consulting company Ariwite operated, for two projects that gave no benefit to the Tribe. Ariwite and Adams paid REDD $9,800 to create a Statement of Qualifications (a marketing brochure) for WSCE. Ariwite and Adams jointly created the SOQ and they allegedly included false and fabricated information about WSCE. For instance, most of the construction projects the SOQ said WSCE had worked on were in fact projects by a private construction company Ariwite and Adams worked with through Warbonnet. Additionally, some of the supposed WSCE professional staff the SOQ profiled were employees of the private construction company. Ariwite and Adams submitted the false and fabricated SOQ to WSCE and allegedly enriched themselves with $9,800 of tribal funds.
Ariwite and Adams also paid REDD $28,000 in tribal funds to create and submit to the U.S. Small Business Administration what is known as an 8(a) application. SBA operates a business development program for small, disadvantaged businesses and an 8(a) certification gives preferences to bid on government contracts. REDD never produced an 8(a) application. In this way, Ariwite and Adams allegedly misapplied $28,000 in tribal funds and enriched themselves with these funds.
The separate indictment against Ariwite alleges that in May/June 2018, Ariwite defrauded a WSV board member and transported the $23,000 fraud proceeds, in the form of a check drawn on the board member’s personal bank account, from Oregon to Idaho.
The Federal Bureau of Investigation investigated this case with assistance from the Warm Springs Police Department. It is being prosecuted by Seth D. Uram, Assistant U.S. Attorney for the District of Oregon.
An indictment is only an accusation of a crime, and a defendant is presumed innocent unless and until proven guilty.
Two Knoxville Residents Charged in Federal Complaint with Conspiracy to Distribute Fentanyl, Heroin, and MethamphetamineRead the Press Release
Knoxville, Tenn. – On September 24, 2020, the United States Attorney’s Office filed a federal complaint charging two individuals, Michael Allen Hill, 45, and Heavyn Breanne Thomas, 23, both from Knoxville, TN, with conspiracy to distribute 400 grams or more of a mixture and substance containing a detectable amount of fentanyl, a Schedule II controlled substance, one kilogram or more of a mixture and substance containing a detectable amount of heroin, a Schedule I controlled substance, and 50 grams or more of methamphetamine, a Schedule II controlled substance. A trial date has not been set.
If convicted of this drug trafficking conspiracy, the defendants face mandatory minimum terms of imprisonment of 10 years and up to life, at least five years of supervised release, a fine of up to $10,000,000, any applicable forfeiture, and a $100 special assessment.
The investigation was conducted by the Knox County Sheriff’s Office Narcotics Unit and the Organized Retail Crime Unit, HIDTA’s Drug Related Death Task Force, and the Knox County Regional Forensics Center. On September 23, 2020, during the execution of a search warrant, officers, assisted by the Knox County Sheriff’s Office SWAT team, seized approximately 972 grams of a brown powdery substance of suspected heroin, 603 grams of a white powdery block-like substance suspected to be a heroin-fentanyl mixture, 865 grams of suspected crystal methamphetamine, multiple firearms, drug paraphernalia, and $51,950 in U.S. currency. Assistant U.S. Attorney Brent N. Jones will represent the United States.
Today, the United States continues to face an unprecedented drug epidemic. The Centers for Disease Control (CDC) estimates that more than 67,000 Americans died of drug overdoses in 2018. Many of these deaths are attributed to the increased abuse of potent and dangerous synthetic opioids like fentanyl. These charges are the result of investigations supported by the Organized Crime Drug Enforcement Task Forces (OCDETF) under the Attorney General-led Synthetic Opioid Surge (SOS)/Special Operations Division (SOD) Project Clean Sweep. This initiative seeks to reduce the supply of synthetic opioids in "hot spot" areas previously identified by the Attorney General of the United States, thereby reducing drug overdoses and drug overdose deaths, and identify wholesale distribution networks and sources of supply operating nationally and internationally.
Members of the public are reminded that the complaint in this case only constitutes a charge against these two individuals and that every person is presumed innocent until his or her guilt has been proven beyond a reasonable doubt.
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Two Former Deutsche Bank Traders Convicted of Engaging in Deceptive and Manipulative Trading Practices in U.S. Commodities MarketsRead the Press Release
A Chicago federal jury found two former employees of Deutsche Bank, a global financial institution, guilty today of fraud charges for their respective roles in fraudulent and manipulative trading practices involving publicly-traded precious metals futures contracts.
Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division and Assistant Director in Charge William Sweeney of the FBI’s New York Field Office made the announcement.
After a two-week trial, James Vorley, 42, of the United Kingdom, and Cedric Chanu, 40, of France and the United Arab Emirates, were convicted of three counts and seven counts, respectively, of wire fraud affecting a financial institution. Sentencing has been scheduled for Jan. 21, 2021, before U.S. District Judge John J. Tharp, Jr. of the Northern District of Illinois, who presided over the trial.
“Today’s jury verdict shows that those who seek to manipulate our public financial markets through fraud will be held accountable by juries and the department,” said Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division.
According to evidence presented at trial, Vorley and Chanu, who were employed as traders at Deutsche Bank—Vorley based in London; Chanu based in London and Singapore—engaged in a scheme to defraud other traders on the Commodity Exchange Inc., which was an exchange run by the CME Group. The defendants defrauded other traders by placing fraudulent orders that they did not intend to execute in order to create the appearance of false supply and demand and to induce other traders to trade at prices, quantities, and times that they otherwise would not have traded. Specifically, the evidence showed that the defendants engaged in the practice of “spoofing,” which means that they placed orders on the exchange which, at the time the orders were placed, they did not intend to execute, all for the purpose of deceiving other market participants.
This case was investigated by the FBI’s New York Field Office. Deputy Chief Brian Young, Assistant Chief Avi Perry, and Trial Attorney Leslie S. Garthwaite of the Criminal Division’s Fraud Section are prosecuting the case.
Individuals who believe that they may be a victim in this case should visit the Fraud Section’s Victim Witness website for more information.
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.
Six Members of Paterson-Based 230 Boys Gang Indicted in 29-Count Second Superseding IndictmentRead the Press Release
NEWARK, N.J. – A federal grand jury has indicted six members of a Paterson street gang on charges of selling heroin and fentanyl, including a charge against one defendant for distributing heroin and fentanyl with death resulting, U.S. Attorney Craig Carpenito announced today.
Charged in a 29-count second superseding indictment are: Wyzier Peterson, 23, a/k/a “Trap;” Carl Brown, 26, a/k/a “C Dub,” a/k/a “Dub;” Aaryn Abrams, 24, a/k/a “AI;” Najier Boone, 24, a/k/a “Bebe;” Zikeme Brooks, 27, a/k/a “Zeek,” a/k/a “Ace;” and Jimir Ricks, 26, a/k/a “40,” a/k/a “Red.” 26.
The defendants are charged as follows:
Count
Charge
Defendant(s)
1
Conspiracy to distribute and to possess with intent to distribute 100 grams or more of heroin and 40 grams or more of fentanyl
Peterson, Brown, Abrams, Boone, Brooks, and Ricks
2
Distribution of heroin and fentanyl
Peterson and Ricks
3
Distribution of heroin
Brown and Boone
4
Distribution of heroin and fentanyl (with death resulting from the substance)
Peterson
5
Distribution of heroin
Peterson
6-13
Distribution of controlled substances (heroin and fentanyl)
Ricks
15
Distribution of heroin and fentanyl
Ricks and Abrams
16-18
Distribution of controlled substances (heroin and fentanyl)
Abrams
19-24
Distribution of controlled substances (heroin and fentanyl)
Boone
25
Distribution of heroin and fentanyl
Brooks
26
Distribution of 28 grams or more of cocaine base
Boone
27
Possession with intent to distribute heroin, fentanyl, and cocaine base
Abrams
28
Use of a firearm in furtherance of a drug trafficking crime
Abrams
29
Possession of a firearm by a convicted felon
Abrams
According to the documents filed in this case and statements made in court:The defendants and their conspirators are members and associates of the 230 Boys street gang, which operates primarily in and around Rosa Parks Boulevard and Godwin Avenue within the City of Paterson. Through numerous controlled purchases of narcotics, consensually recorded telephone calls and text messages, physical surveillance, and the analysis of telephone call detail records, law enforcement determined that from at least September 2018 through July 3, 2019, the defendants and their conspirators conspired to distribute narcotics, including heroin and fentanyl. In October 2019, the defendants and 10 other members and associates of the 230 Boys were charged by complaint.
Six co-defendants have since pleaded guilty before U.S. District Judge Brian R. Martinotti: Keith Brinkley, 30; Isaiah Hargrove, 21; Tyson Jacobs, 21; Amir Jones, 21; Dwayne Northern, 35; and Cequan Wharton, 30, all of Paterson.
Count 4 carries a mandatory minimum sentence of 20 years in prison, a maximum penalty of life in prison, and a mandatory fine of $1 million. Counts 1 and 26 carry a mandatory minimum sentence of five years in prison, and a maximum penalty of 40 years in prison, and a maximum fine of $5 million. Counts 2-3 and 5-27 carry a maximum penalty of 20 years in prison and a maximum fine of $1 million. Count 28 carries a mandatory minimum penalty of five years in prison and a maximum penalty of life in prison, which must run consecutively to any other term of imprisonment imposed, as well as a maximum fine of $250,000. Count 29 carries a maximum penalty of 10 years in prison and a maximum fine of $250,000.
This case is being conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF). The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
U.S. Attorney Carpenito credited special agents and task force officers with the Bureau of Alcohol, Tobacco, Firearms and Explosives, Newark Division, under the direction of Special Agent in Charge Charlie J. Patterson; special agents of the Drug Enforcement Administration, under the direction of Special Agent in Charge Susan A. Gibson in Newark; officers of the N.J. State Police, under the direction of Col. Patrick J. Callahan; officers of the Paterson Police Department, under the direction of Director Jerry Speziale and Police Chief Ibrahim Baycora; and detectives of the Passaic County Prosecutor’s Office, under the direction of Prosecutor Camelia Valdes, with the investigation leading to the charges. He also thanked the U.S. Marshals Service, the Bergen County Sheriff's Office and the Belleville and Livingston police departments for their assistance with the case.
The government is represented by Assistant U.S. Attorney Francesca Liquori of the U.S. Attorney’s Office’s Organized Crime and Gangs Unit in Newark.
The charges and allegations in the second superseding indictment and previous criminal complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Sham Trader Who Urged Investors to ‘Profit Off’ Pandemic Charged with Commodities FraudRead the Press Release
A man who urged investors to “profit off” the COVID-19 pandemic has been charged with commodities fraud, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.
A federal grand jury indicted Kenzley Ramos, 27, of Lawrenceville, Georgia, on one count of commodities fraud for falsely promising investors that he would trade their money on foreign currency exchange markets while pocketing their funds. Mr. Ramos surrendered to federal authorities in Atlanta on Friday morning, and made his initial appearance in federal court on Friday afternoon.
According to the indictment, unsealed today, Mr. Ramos used a classified advertisements website to market himself as a skilled foreign currency exchange, or “forex,” trader.
As the nation’s stock markets cratered in the spring of 2020 due to the threat of COVID-19 outbreak, Mr. Ramos preyed on the public’s concerns surrounding the pandemic, telling prospective investors that the “stock market is crumbling” and inviting them to “profit off the coronavirus with forex.” He said there was “no possible way” investors could lose money with his expertise, claiming “guaranteed” returns as high as 300 percent.
Instead of investing their money, however, Mr. Ramos misdirected investors’ funds to his own personal use and to enrich others.
An indictment is merely an allegation of criminal conduct, not evidence. Like all defendants, Mr. Ramos is presumed innocent unless and until proven guilty in a court of law.
If convicted, Mr. Ramos faces up to 25 years in federal prison.
The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation with the assistance of the Commodity Futures Trading Commission (CFTC) and the Texas State Securities Board (TSSB). Assistant U.S. Attorney Fabio Leonardi, the Northern District of Texas’ COVID-19 Coordinator, is prosecuting the case.
Se Acusa a Pareja de Chula Vista de Haber Estafado a Mujeres Embarazadas y a un Programa de Medi-Cal de CaliforniaRead the Press Release
RESUMEN DEL COMUNICADO DE PRENSA –24 de septiembre de 2020
SAN DIEGO – Melissa Álvarez Torres y José Luis Olmos Hernández, una pareja de Chula Vista que operaba lo que ellos afirmaban era una compañía privada que vendía seguros de salud, hicieron su primera comparecencia en el tribunal federal el día de hoy para responder a cargos de que se asociaron delictivamente para estafar a cientos de mujeres embarazadas y de ocasionarle aproximadamente 1.6 millones de dólares en pérdidas a Medi-Cal, un programa federal de servicios de salud.
Según una demanda penal que se reveló esta tarde, del 2016 hasta la fecha presente, Álvarez y Olmos se asociaron delictivamente para defraudar al Programa de Acceso a Medical ("MCAP," por sus siglas en inglés), que es un programa de servicios de salud que administra el Departamento de Servicios para el Cuidado de la Salud de California (DHCS, por sus siglas en inglés) que opera con fondos del gobierno estatal y el gobierno federal. MCAP es un programa diseñado para ayudar a familias trabajadoras de
medianos ingresos del estado de California que no cuentan con un seguro de salud adecuado que cubra los servicios de maternidad y el cuidado post-natal a un bajo costo basado en sus ingresos.
La demanda alega que Álvarez y Olmos promovían el "seguro" privado a mujeres embarazadas de nacionalidad mexicana que tuviesen una visa de trabajo o de turista. A través de publicidad en Facebook, donde se anunciaban bajo el nombre de Seguros Americanos Embarazo ("American Pregnancy Insurance"), Álvarez y Olmos engañosamente aducían que el "seguro" que ellos ofrecían permitiría que estas mujeres embarazadas dieran a luz legalmente en los Estados Unidos, sin arriesgar sus visas por utilizar los servicios gubernamentales. Le cobraron a cada una de las mujeres embarazadas miles de dólares por el supuesto "seguro".
Sin embargo, Álvarez y Olmos en realidad no tenían un seguro privado que pudiesen vender. En lugar de eso, ellos usaron la información personal que identificaba a estas mujeres para registrarlas para recibir las prestaciones que ofrece MCAP. Como se acusa en la demanda, Álvarez y Olmos presentaron cientos de solicitudes fraudulentas y documentación fiscal y de empleo fraudulenta para apoyar dichas solicitudes ante MCAP, simulando que las mujeres calificaban para recibir dichas prestaciones cuando en realidad no calificaban – y no habían dado su consentimiento para que se les inscribiera en dicho programa. Como resultado, se acusa a Álvarez y Olmos de haberles costado a los contribuyentes americanos millones de dólares en costos de servicios de salud, además de los cientos de miles de dólares en honorarios que recibieron de las mujeres a las que estafaron.
Álvarez y Olmos fueron arrestados el miércoles en la mañana como resultado de una investigación que involucró a múltiples dependencias, que inició el Departamento de Servicios para el Cuidado de la Salud de California, y que se llevó a cabo en cooperación con otras dependencias, incluyendo la Administración del Seguro Social, la Oficina de la Fiscalía Federal del Distrito Sur de California, y el Buró Federal de Investigaciones (FBI), para la aplicación de las leyes que gobiernan a Viajeros y la Residencia.
"No vamos a tolerar a estafadores que tratan de lucrar y aprovecharse de programas importantes de salud pública y de mujeres embarazadas", declaró el Fiscal Federal Brewer. "Seguiremos protegiendo al contribuyente americano y garantizaremos la integridad de los programas cuyo propósito es ayudar a los menesterosos e investigaremos y procesaremos penalmente a quienes tratan de aprovecharse de ellos".
"Agradecemos el apoyo crucial que las dependencias aliadas brindaron en esta investigación para arrestar a personas que tratan de aprovecharse de algunos de los miembros más vulnerables de nuestra sociedad, así como la asistencia que brindaron para proteger la integridad del programa Medi-Cal", señaló el Director de DHCS, Will Lightbourne.
"Agentes del FBI trabajan de manera diligente todos los días sin falta para descubrir actividades de fraude en contra del gobierno", declaró la Agente Especial a Cargo Suzanne Turner. "En este caso, los investigadores descubrieron una pérdida que se aduce es de 1.6 millones de dólares que sufrió el Programa Medi-Cal de California, así como dinero que se obtuvo de manera fraudulenta de cientos de mujeres embarazadas que creyeron que estaban comprando un seguro legítimo con cobertura para los servicios de salud que necesitaban. La viabilidad de los programas de servicios de salud gubernamentales depende de que estos programas se utilicen con honradez y para las personas necesitadas. Por ello, el FBI se mantiene firme en la realización del importante trabajo de descubrir el fraude en los servicios de salud, trabajando en alianza con el Departamento de Servicios para el Cuidado de la Salud de California y otras dependencias a cargo de la ejecución de la ley".
Si usted cree que ha sido víctima de Álvarez y Olmos, o si ha comprado un seguro de salud de Seguros Americanos Embarazo, por favor comuníquese con el Departamento de Servicios para el Cuidado de la
Salud de California, marcando el número 1-800-822-6222.
ACUSADOS Caso Núm. 20-mj-4076
MELISSA ÁLVAREZ TORRES Edad 33 Chula Vista, CA
alias "Melissa Torres"
alias "Melissa A. Torres"
JOSÉ LUIS OLMOS HERNÁNDEZ Edad 36 Chula Vista, CA
alias "José Luis Hernández"
alias "José L. Hernández"
alias "José Carlos"
alias "Carlos García"
RESUMEN DE LOS CARGOS
Asociación Delictuosa para Cometer Fraude a los Servicios de Salud y Fraude Mediante el Uso de Telecomunicaciones – Título 18, U.S.C., Sección 1349
Pena Máxima: 20 años de encarcelamiento y una multa de $250,000 dólares, o dos veces la ganancia monetaria o dos veces la pérdida monetaria, lo que resulte ser mayor. El resarcimiento es obligatorio.
DEPENDENCIAS
Departamento de Servicios para el Cuidado de la Salud del Estado de California
Buró Federal de Investigaciones
*Los cargos y alegatos que contiene una acusación formal o demanda penal son únicamente acusaciones, y a los acusados se les considera inocentes a menos que y hasta que se pruebe su culpabilidad.
Santee, Nebraska Man Sentenced for Assault with a Dangerous WeaponRead the Press Release
United States Attorney Joe Kelly announced that Whitney Frazier, age 34, of Santee, Nebraska, was sentenced today by United States District Judge Robert F. Rossiter, Jr. to 51 months’ imprisonment for assault with a dangerous weapon. Frazier will also serve three years of supervised release after he is released from prison. There is no parole in the federal system.
In April 2018, Frazier assaulted a female acquaintance with whom he did not have a friendship or relationship. The victim was giving Frazier a ride to a house on the Winnebago Indian Reservation. Once at the home, Frazier attacked the victim, physically assaulting her by punching her and kicking her. The victim fled back to her vehicle and tried to drive away, but Frazier followed her and was able to get into the passenger seat of the vehicle. The victim was ordered to drive by Frazier, who also brandished an item the victim initially thought was a gun, later believed to be a pellet gun. The victim drove erratically attempting to get the attention of the police. The victim drove onto the Omaha Nation Indian Reservation and Frazier placed the car into park while it was in motion, causing the vehicle to stall. When the car stopped, the victim grabbed a screw driver in the car for protection from Frazier. Frazier took the screwdriver from the victim and used the handle end to stab the victim in the eye. The victim got out of the car and began to run away and flag down a passing vehicle. Frazier fled and was later arrested.
This case was investigated by the Omaha Nation Law Enforcement Services and the Federal Bureau of Investigation.
Rochester Man Going to Prison for 12 Years for Illegally Possessing A Gun and Attempting to Sell CocaineRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051ROCHESTER, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Miguel Gonzalez-Adams, 41, of Rochester, NY, who was convicted of attempted possession of cocaine with intent to distribute, and being a felon in possession of a firearm, was sentenced to serve 144 months in prison by U.S. District Judge Charles J. Siragusa.
Assistant U.S. Attorney Sean C. Eldridge, who handled the case, stated that on January 31, 2020, United States Postal Inspectors obtained a search warrant for a priority mail package that was sent from Puerto Rico to the defendant’s residence in Rochester. The package contained over two kilograms of cocaine. The cocaine was removed from the package and replaced with sham cocaine. Postal Inspectors then conducted a controlled delivery of the package to Gonzalez-Adams’ residence.
On February 3, 2020, once the defendant accepted delivery of the package, law enforcement officers executed a search warrant of Gonzalez-Adams’ residence. Officers found the opened package on the first floor of the house. The defendant was located in an upstairs bedroom with $2,435 in cash and a cell phone that displayed the tracking information for the cocaine package. Officers also recovered a loaded AR-15 style rifle, along with an additional 162 rounds of ammunition for that weapon.
Gonzalez-Adams was previously convicted in 1999 of felony crimes in the United States District Court for the District of Puerto Rico. As a result, he is legally prohibited from possessing a firearm.
The sentencing is the result of an investigation by the United States Postal Inspection Service, under the direction of Inspector-in-Charge Joseph W. Cronin of the Boston Division; the Drug Enforcement Administration, under the direction of Special Agent-in-Charge Ray Donovan, New York Field Division; the Rochester Police Department, under the direction of Acting Chief Mark Simmons; the Monroe County Sheriff’s Office, under the direction of Sheriff Todd Baxter; the Ontario County Sheriff’s Office, under the direction of Sheriff Kevin M. Henderson; the Greece Police Department, under the direction of Chief Patrick D. Phelan; the Webster Police Department, under the direction of Chief Joseph Rieger; and the New York State Police, under the direction of Acting Major Barry Chase.
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Radiology Center Pays $501,000 to Resolve Healthcare Fraud AllegationsRead the Press Release
Fort Myers, FL – United States Attorney Maria Chapa Lopez announces that Advanced Imaging of Port Charlotte, LLC, a radiology center headquartered in Port Charlotte, Florida, has agreed to pay $501,000 to resolve allegations that it violated the False Claims Act by submitting fraudulent claims to Medicare and Tricare, a health care program for uniformed service members, retirees, and their families.
As part of the settlement, the United States contends that Advanced Imaging knowingly submitted claims to Medicare and Tricare by (1) administering dye-contrast scans without direct physician supervision as required by Federal regulations and (2) improperly billing for services performed by doctors who were not properly credentialed by Medicare.
“This settlement reflects our continuing efforts to protect our military and their families, our community, and the taxpayers by ensuring that the care provided to beneficiaries of government-funded healthcare programs is consistent with federal regulations,” said United States Attorney Chapa Lopez. “We will continue to hold healthcare providers accountable when they provide services by individuals who are not credentialed, licensed, or appropriately supervised.”
“Working alongside our investigative partners, The Defense Criminal Investigative Service (DCIS) is committed to protecting the integrity of the U.S. Military Healthcare program,” said Cynthia A. Bruce, Special Agent in Charge, DCIS Southeast Field Office. “DCIS appreciates the continual support of the U.S. Attorney's Office throughout Florida for their efforts to recoup financial losses which will be used for the care of our military beneficiaries.”
This settlement resulted from a coordinated effort by the U.S. Attorney’s Office for the Middle District of Florida, DCIS, and the U.S. Department of Health and Human Services Office of Inspector General. The investigation was led by Assistant U.S. Attorney David P. Sullivan.
The claims resolved by the settlement are allegations only and there has been no determination of liability. The civil settlement resolves the following captioned cases: United States, et al. v. KMH Cardiology Centres, Inc., et al., 2:16-cv-618-TPB-MRM, and United States of America, et al. v. SAVN Administrative Services, Inc., et al., 2:16-cv-622-SPC-MRM.
Philadelphia City Treasurer Arrested and Charged with Multiple FraudsRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that Christian Dunbar, 40, of Philadelphia, PA, the current Philadelphia City Treasurer, was arrested this morning and charged by Criminal Complaint with embezzlement by a bank employee, conspiracy to commit marriage fraud, and fraudulent procurement of citizenship. U.S. Attorney McSwain detailed the charges at a press conference this afternoon in front of the James A. Byrne U.S. Courthouse in Philadelphia.
As the Philadelphia City Treasurer, Dunbar’s responsibilities include: (1) managing the City’s debt obligations, which includes overseeing the issuance of the City’s municipal bonds; (2) managing the City’s bank accounts, including its operating account, capital account, and petty cash accounts in various departments; (3) paying the City’s bills, including making payments to vendors, cutting payroll checks, and making payments to pension plans; and (4) managing the City’s cash reserves.
According to the Criminal Complaint, Dunbar allegedly participated in two schemes – (1) bank embezzlement and (2) marriage fraud in order to become a U.S. citizen.
The details of the alleged bank embezzlement scheme are as follows: Just weeks before his appointment to serve as the City’s Deputy Treasurer, Dunbar, while employed at Wells Fargo Bank in Newtown Square, stole $15,000 from two different bank customers. The Complaint alleges that on two separate occasions, once in December 2015 and again in January 2016, Victim #1 met with the defendant to transfer $5,000 between Victim #1’s Wells Fargo bank accounts. During both meetings, Dunbar allegedly directed Victim #1 to sign several documents, including a blank withdrawal slip. He later allegedly used the blank slips to withdraw cash from Victim #1’s account and deposit those funds into his own personal bank account.
The defendant allegedly used the same trick with Victim #2. In December 2015, Dunbar assisted Victim #2 in the same Wells Fargo branch and directed Victim #2 to sign several documents, including a blank withdrawal slip. As alleged in the Criminal Complaint, he later used the blank withdrawal slip to withdraw money from Victim #2’s account. Soon thereafter, Dunbar allegedly made significant cash deposits into his personal bank account.
Dunbar also allegedly participated in a conspiracy to enter into a sham marriage in order to secure immigration benefits, and ultimately U.S. citizenship, for himself and his family. The details of that alleged fraud are as follows: The Criminal Complaint alleges that the defendant and his current wife, identified in the Complaint by the initials “F.N.D.,” both entered into fraudulent marriages, Dunbar with Person #1 and his wife with Person #2. Prior to these sham marriages, Persons #1 and #2 were U.S. citizens, but Dunbar and F.N.D. were not – having been born in Liberia and Senegal, respectively. By marrying U.S. citizens, Dunbar and F.N.D. were able to gain their own U.S. citizenship.
These four individuals – Christian Dunbar, F.N.D., and Persons #1 and #2 – attended Temple University together and allegedly coordinated this sham marriage plan. Both of these sham marriages occurred within days of each other in December 2006 and were performed by the same officiant — a former Temple University professor. But since the time they attended Temple University together, Dunbar and F.N.D. were the only legitimate couple, marrying each other in Senegal in June 2013 (while Dunbar was still legally married to Person #1). On their child’s 2014 birth records, Dunbar is listed as the father, F.N.D. is listed as the mother, and they are listed as married to each other.
But in February 2012, relying on his sham marriage to Person #1, the defendant allegedly applied to become a permanent resident of the United States (which he certified as true under the penalty of perjury), was granted that status in October 2012, and then submitted additional paperwork to become a naturalized citizen in late 2015 and early 2016. As detailed in the Complaint, in paperwork he submitted in 2015 and in subsequent interviews, he continued to make fraudulent claims about his marital status, which was the basis for his becoming a naturalized citizen in January 2016. Two months later, he filed paperwork to divorce Person #1.
“The alleged conduct in this case shows a pattern of deception, dishonesty and criminality that no individual should ever engage in – but is especially alarming and intolerable for a high ranking City official,” said U.S. Attorney McSwain. “City officials whose job is to handle money should not be thieves. And they should not have a track record of engaging in elaborate immigration fraud against the public that they are supposed to serve. My Office will continue to hold public officials to the high standard of conduct that residents of this City deserve. And when we find that a public official’s behavior falls short, we will hold them accountable.”
“The accusations against Christian Dunbar run quite the criminal gamut, from stealing his own bank customers’ money to violating the immigration laws that help protect our national security,” said Michael J. Driscoll, Special Agent in Charge of the FBI's Philadelphia Division. “In his role as City Treasurer, Dunbar holds a position of public trust, making these charges lodged against him today extremely disturbing. The FBI is working every day to battle public corruption and the corrosive damage it does to people’s faith in government. We must hold public officials to high ethical standards — and we will hold them to obeying federal law.”
If convicted, Dunbar faces a maximum possible sentence of 45 years’ imprisonment and a fine of $1.5 million.
The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Denise S. Wolf.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Perry Man Sentenced to Federal Prison for Child Pornography OffenseRead the Press Release
DES MOINES, IA – On September 17, 2020, United States District Court Judge Rebecca Goodgame Ebinger sentenced Michael James Hidlebaugh, age 38, of Perry, to 97 months in prison for Receipt of Child Pornography, announced United States Attorney Marc Krickbaum. Hidlebaugh was ordered to serve five years of supervised release to follow his prison term, pay $21,000 in restitution, and comply with sex offender registry requirements upon release.
The investigation began in September 2017 when law enforcement received an investigative lead from the National Center for Missing and Exploited Children that images of child pornography had been uploaded to Hidlebaugh’s email account. Following further investigation, law enforcement executed a search warrant at Hidlebaugh’s Perry residence in May 2018. Law enforcement seized multiple electronic devices, which contained hundreds of images and videos of child pornography. The investigation showed that from July 2016 to April 2018, Hidlebaugh received child pornography.
This case was investigated by the Iowa Division of Criminal Investigation Internet Crimes Against Children Task Force and the FBI Child Exploitation Task Force. This case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
Parma Man Sentenced to over 16 Years for Distribution of Child PornographyRead the Press Release
BOISE – Jason Harvey, 45, of Parma, was sentenced in U.S. District Court to 200 months in federal prison for distribution of child pornography, U.S. Attorney Bart M. Davis announced today. U.S. District Judge B. Lynn Winmill also sentenced Harvey to a lifetime of supervised release following his prison sentence. Harvey pleaded guilty to the charge on June 24, 2020.
According to court records, the investigation began after Google, Facebook, and Yahoo! reported that child pornography had been uploaded to various online accounts between December 23, 2016 and March 25, 2019. The reports were assigned to the Idaho Internet Crimes Against Children (ICAC) Task Force for investigation. ICAC obtained search warrants for the online accounts, which revealed the accounts belonged to Harvey. Within the accounts, ICAC located images and videos of child pornography and emails and messages where Harvey discussed trading child pornography with others. ICAC also located several emails and messages where Harvey sent child pornography files to other individuals and received child pornography files in return. A federal magistrate judge issued a search warrant for Harvey’s residence in Parma. During the execution of the search warrant, ICAC detectives interviewed Harvey. Harvey admitted ownership of the online accounts, but denied involvement in child pornography.
Judge Winmill also ordered Harvey to pay $6,000 in restitution to victims in the images he possessed. As a result of his conviction, Harvey will be required to register as a sex offender.
This case was investigated by the Idaho ICAC Task Force with assistance from United States Postal Inspection Service, Canyon County Prosecutor’s Office, Canyon County Sheriff’s Office, Caldwell Police Department, and Parma Police Department.
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. As part of Project Safe Childhood, the U.S. Attorney’s Office for the District of Idaho and the Idaho Attorney General’s Office partner to marshal 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.”
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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.
Owner of Tax Preparation Business Sentenced to Prison for Filing False ReturnsRead the Press Release
A former Gulfport, Mississippi, tax return preparer was sentenced to 46 months in prison today for aiding and assisting in the preparation of false returns, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Mike Hurst for the Southern District of Mississippi.
According to documents and information provided to the court, Alvin Mays owned and operated City Tax Service, a return preparation business in the Gulfport, Mississippi, area. From 2012 through 2017, Mays prepared – and trained his employees to prepare – false tax returns. To fraudulently inflate client refunds, the returns claimed false education credits and losses from fictitious business. Mays charged his clients exorbitant preparation fees, sometimes as high as $1,600 per return. In all, Mays’s conduct caused a tax loss to the United States of more than $900,000.
In addition to the term of imprisonment, U.S. District Judge Halil S. Ozerden ordered Mays to serve one year of supervised release and to pay $321,605 in restitution to the United States.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Hurst thanked special agents of IRS-Criminal Investigation, who conducted the investigation, and Trial Attorney Kevin Schneider of the Tax Division and Assistant U.S. Attorney Stanley Harris, who prosecuted the case.
Owner of the Surrogacy Group Pleads Guilty in Federal Court in Maryland for Defrauding Clients of Fees Paid to Find and Support A Pregnancy SurrogateRead the Press Release
Baltimore, Maryland – Gregory Ray Blosser, age 38, of Tampa, Florida, pleaded guilty today to a federal wire fraud charge in connection with a scheme to defraud clients of The Surrogacy Group (TSG), which he owned and operated from offices in Annapolis, Maryland and Tampa, Florida. Blosser was arrested on April 29th in Florida and has been under home confinement since his arrest.
The guilty plea was announced by United States Attorney for the District of Maryland Robert K. Hur and Special Agent in Charge Jennifer C. Boone of the Federal Bureau of Investigation, Baltimore Field Office.
“The facts of this case are especially egregious because Gregory Blosser took advantage of individuals who were trying to become parents,” said U.S. Attorney Robert K. Hur. “Criminals like Blosser, who line their pockets through such heartless deceit, will be held accountable.”
“Dreams, hopes and bank accounts were wiped clean by Mr. Blosser who preyed on couples who were already in a vulnerable place,” said Jennifer C. Boone, Special Agent in Charge of the FBI Baltimore Field Division. “This guilty plea is a reminder that the FBI will use our resources appropriately to root out fraudulent surrogacy schemes that violate the trust of the American public."
According to Blosser’s plea agreement, TSG was incorporated in Maryland on January 5, 2012 and offered and sold surrogacy-related services throughout the United States and internationally to individuals who desired to have children using a pregnancy surrogate. From at least 2015 until his arrest in 2019, Blosser solicited and accepted funds from TSG clients who desired to have children using a surrogate, representing that these funds would be held in escrow. Blosser told the clients that he would act as their agent disbursing the funds to the surrogate pursuant to contracts between the TSG client and TSG, and the TSG client and the surrogate.
Instead, Blosser admitted that beginning in 2017, he converted a significant portion of the funds he promised to hold in escrow to his own use without the authorization of the TSG client and failed to pay the surrogate as he had agreed to do. Blosser did not, as promised, create separate escrow accounts for these funds and as a result, those funds intermingled with TSG’s operating accounts and were used to pay business expenses, service business loans, and for other purposes not permitted under the escrow agreements. TSG clients were forced to pay the surrogate’s expenses themselves, effectively paying twice for the services Blosser had promised to deliver.
As detailed in his plea agreement, at Blosser’s direction, at least seven victims paid fees to establish an escrow account to be controlled by Blosser, with the funds to be used to find a suitable surrogate, and to support the surrogate during a pregnancy. The victims lived in Maryland, Australia, North Carolina, Germany, and Virginia. In each case, after the victims deposited funds into the escrow account, Blosser either did not locate a suitable surrogate, or did not pay the surrogate the agreed-upon fees.
In total, Blosser fraudulently obtained approximately $1,104,706 from approximately 44 victims.
Blosser is also facing related civil suits filed by the States of Maryland and Florida.
Blosser faces a maximum sentence of 20 years in prison for wire fraud. 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. U.S. District Judge Ellen L. Hollander has scheduled sentencing for January 15, 2021, at 2:00 p.m.
United States Attorney Robert K. Hur commended the FBI for its work in the investigation. Mr. Hur thanked Assistant U.S. Attorney Leo J. Wise, who is prosecuting the case.
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Orange Park Man Charged with Sex Trafficking A Child After Traveling to Meet A Child for SexRead the Press Release
Jacksonville, Florida – United States Attorney Maria Chapa Lopez announces the filing of a criminal complaint charging Gregory Thomas Garcia (34, Orange Park) with commercial sex trafficking of a child. If convicted, Garcia faces a minimum mandatory penalty of 10 years, and up to life, in federal prison.
According to the complaint, beginning at least by October 2019, Garcia began communicating via text message with a minor victim, who was 16 years old at the time. A special agent with Homeland Security Investigations discovered the text messages between Garcia and the victim while investigating a separate crime. The victim confirmed to the special agent and a detective with the Clay County Sheriff’s Office that she had met with Garcia more than 20 times, and on each occasion Garcia had paid her to allow Garcia to sexually abuse her.
The victim also disclosed to agents additional messages that she had exchanged with Garcia via Snapchat. The victim agreed to let agents take over her Snapchat account in order to conduct an undercover investigation of Garcia.
From September 21-23, 2020, an undercover agent, posing as the victim, communicated with Garcia via the Snapchat account. In those communications, Garcia arranged to meet the victim in a parking lot and agreed to provide the victim with $150, a Sprite soda, and Starburst candy in exchange for the victim allowing Garcia to sexually abuse her. On September 23, 2020, Garcia obtained money, a Sprite soda, and Starburst candy, and traveled to the location where he had expected to meet with the victim. Garcia was then arrested by law enforcement.
A complaint is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by Homeland Security Investigations and the Clay County Sheriff’s Office. It will be prosecuted by Assistant United States Attorney Laura Cofer Taylor.
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 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.
Operation Shutdown Corner Update: Ohio Man Sentenced for Federal Drug CrimeRead the Press Release
BECKLEY, W.Va. – An Ohio man was sentenced for his participation in an extensive drug trafficking organization (DTO) operating between California, Ohio, Michigan, and the Southern District of West Virginia, announced United States Attorney Mike Stuart. Jason Johnson, 31, of Columbus, was sentenced to 78 months in prison, to be followed by a three year term of supervised release, for conspiring to distribute 50 grams or more of methamphetamine. Johnson was one of 17 defendants charged as a result of a long-term investigation, known as “Operation Shutdown Corner.”
“Through operations like Shutdown Corner, we can curtail meth trafficking in our communities,” said United States Attorney Mike Stuart. “Johnson is one of 17 defendants charged as a result of this investigation which brought an end to a DTO responsible for distributing significant amounts of illicit drugs in our southern counties.”
Johnson previously admitted that between June 2018 and September 17, 2019, he participated in the DTO by supplying Stephanie McClung, a co-defendant in this matter, and others with distribution amounts of methamphetamine and heroin. During this time period, Johnson admitted to selling more than 50 grams of a substance containing methamphetamine to McClung knowing it was her plan and purpose to re-distribute those drugs in and around Raleigh County and the Southern District of West Virginia. Johnson admitted to meeting with McClung several times a week to supply her with drugs.
Stuart commended the cooperative investigative efforts of the Federal Bureau of Investigation (FBI), the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the United States Postal Inspection Service (USPIS), the Beckley/Raleigh County Drug and Violent Crimes Task Force, the Raleigh County Sheriff’s Office, the Beckley Police Department, and the West Virginia State Police.
Assistant United States Attorney Timothy D. Boggess handled the prosecution. United States District Judge Frank W. Volk imposed the sentence.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 5:19-cr-00237.
Follow us on Twitter: SDWVNews and USAttyStuart
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Operation Legend: Case of the DayRead the Press Release
Each weekday, the Department of Justice will highlight a case that has resulted from Operation Legend. Today’s case is out of the Western District of Missouri. Operation Legend launched in Kansas City on July 8, 2020, in response to the city facing increased homicide and non-fatal shooting rates.
United States vs. Daniel Dewayne Gregg
A Bates City, Missouri, man was charged in federal court after law enforcement officers seized nearly two dozen firearms and illegal drugs from his residence.
Daniel Dewayne Gregg, 57, was charged on Sept. 11, 2020, with one count of conspiracy to distribute methamphetamine and one count of possessing a firearm in furtherance of drug trafficking.
According to court documents, law enforcement officers identified Gregg as a major supplier of methamphetamine trafficking following several controlled drug purchases. Officers executed a search warrant at Gregg’s residence on Friday, Sept. 11, and placed him under arrest.
It is alleged that Gregg told officers that he had been dealing crystal methamphetamine continuously for at least the past six months and stated that he was a kilogram-level dealer of crystal methamphetamine and had sold, at a conservative minimum, at least 12 kilograms of crystal methamphetamine per month for the past six months. Gregg stated he had several large-scale customers who purchased at least a half-kilogram of methamphetamine from him at a time. Gregg said he purchased methamphetamine for $12,000 per kilogram and sold it for about $13,000 per kilogram.
Officers located a large firearms safe in the basement of Gregg’s residence that contained 22 firearms and a large amount of cash. Officers also searched Gregg’s vehicle and found 151.6 grams of methamphetamine, 436.5 grams of marijuana, and 207 prescription pills in unlabeled pill bottles. Officers also found methamphetamine inside a fanny pack and a loaded Smith and Wesson .40-caliber semi-automatic pistol on top of the fanny pack. Gregg allegedly told officers he had the firearm because he had been threatened by individuals wanting to do him harm.
The details contained in the charging document are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Background on Operation Legend
Since its inception, Operation Legend has yielded more than 3,500 local, state, and federal arrests, with more than 800 defendants charged with federal crimes.President Trump promised to assist America’s cities that have been plagued by violence. In July, Attorney General William P. Barr announced the launch of Operation Legend, a sustained, systematic and coordinated law enforcement initiative across all federal law enforcement agencies working in conjunction with state and local law enforcement officials to fight violent crime in cities across America that were experiencing an uptick in violence. Operation Legend is named after four-year-old LeGend Taliferro, who was shot and killed on June 29th in Kansas City, Missouri, while asleep in his home.
Operation Legend was launched in Kansas City, Mo., on July 8, 2020, and expanded to Chicago and Albuquerque on July 22, 2020; to Cleveland, Detroit, and Milwaukee on July 29, 2020; to St. Louis and Memphis on Aug. 6, 2020; and to Indianapolis on Aug. 14, 2020. As part of Operation Legend, Attorney General Barr has directed federal agents from the FBI, U.S. Marshals Service, DEA and ATF to surge resources to these cities to help state and local officials fighting violent crime. The Department of Homeland Security is also contributing agents to these efforts in St. Louis.
Ocala Convicted Felon Sentenced to 30 Months in Federal Prison for Possessing A FirearmRead the Press Release
Ocala, Florida – Senior United States District Judge John Antoon II today sentenced Jonathan Cruz Carino (28, Ocala) to two and a half years in federal prison for possession of a firearm affecting commerce by a convicted felon. Carino had pleaded guilty on June 22, 2020.
According to court documents, on May 10, 2019, City of Ocala police officers responded to a call concerning a potential shooting. Upon arrival, they located Carino and a juvenile in a wooded area adjacent to a boat. A search of the boat revealed two loaded handguns concealed under a tarp. The juvenile told authorities that Carino had been trying to sell the firearms. The FBI laboratory subsequently confirmed a substantial DNA profile from Carino on one of the firearms. Carino has previous state felony convictions for drug possession and the sale of drugs near a place of worship. As a consequence, he is prohibited from possessing firearms and ammunition under federal law.
This case was jointly investigated by the City of Ocala Police Department and the FBI. It was prosecuted by Assistant United States Attorney Robert E. Bodnar, Jr.
This is another case prosecuted as part of the Department of Justice’s “Project Safe Neighborhoods” Program (PSN), which is a nationwide, crime reduction strategy aimed at decreasing violent crime in communities. It involves a comprehensive approach to public safety — one that includes investigating and prosecuting crimes, along with prevention and reentry efforts. In the Middle District of Florida, U.S. Attorney Maria Chapa Lopez coordinates PSN efforts in cooperation with various federal, state, and local law enforcement officials.
Niagara Falls Man Going to Prison for Possessing Child PornographyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Randy Colucci, 36, of Niagara Falls, NY, who was convicted of possessing child pornography, was sentenced to 75 months in prison by U.S. District Judge Richard J. Arcara.
Assistant U.S. Attorney Michael DiGiacomo, who handled the case, stated that in April 2017, a Homeland Security Investigations Special Agent, working undercover, discovered multiple files containing videos and images of child pornography being shared on a peer to peer website. Some of the videos and images depicted prepubescent children in sexual situations. Investigators determined that the IP address connected to the files related to one utilized by the defendant, which led to the execution of a search warrant at his residence. Digital media recovered from Colucci in June 2017 contained child pornography, including children under the age of 10, and images of children involved in violent sexual assaults.
At the time of his arrest, the defendant was on New York State parole for a 2011 manslaughter conviction, involving the death of his two-year-old daughter.The sentencing is the result of an investigation by Homeland Security Investigations, under the direction of Special Agent-in-Charge Kevin Kelly.
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New Orleans Woman Charged for Theft of More Than $69,000 in Social Security FundsRead the Press Release
NEW ORLEANS - United States Attorney Peter G. Strasser announced that VALERIE YOREL MANSON (“MANSON”), age 51, of New Orleans, Louisiana, was charged on September 22, 2020 by a Bill of Information for Theft of Government Funds, in violation of Title 18, United States Code, Section 641.
According to the Bill of Information, beginning in 2010 and continuing through 2016, MANSON collected Social Security Administration benefits of approximately $700 per month paid to an account held in the name of a deceased relative. Accordingly, MANSON fraudulently received approximately $69,000.00 in Social Security Administration benefits, to which she was not entitled.
U.S. Attorney Strasser reiterated that the Bill of Information is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
If convicted, MANSON faces a maximum penalty of ten (10) years imprisonment, followed by up to three (3) years of supervised release, a fine of up to $250,000.00, and a mandatory $100 special assessment.
U.S. Attorney Strasser praised the work of the Social Security Administration, Office of Inspector General. The prosecution of this case is being handled by Assistant U.S. Attorney Kathryn McHugh.
NDTX Round-Up: September 18-24Read the Press Release
SENTENCING – DOMINGO SANTIAGO CEDANO-MARTINEZ
On September 18, Domingo Santiago Cedano-Martinez, 24, was sentenced to 8 years in federal prison for possession of a controlled substance with intent to distribute. On August 8, 2019, Cedano-Martinez met with a co-conspirator at Town East Mall in Mesquite, Texas to sell 993 grams of methamphetamine. During the drug transaction, law enforcement arrested Cedano-Martinez and seized the drugs. This case was investigated by the Drug Enforcement Administration. Assistant U.S. Attorney Gregory Martin prosecuted this case.
GUILTY PLEA – BERNICE LEE WOODSON, JR.
On September 22, Bernice Lee Woodson, Jr., 35, plead guilty to possession with intent to distribute 500 grams or more of methamphetamine. DEA agents executed a search warrant at Woodson’s home in Crandall, Texas. Inside the kitchen refrigerator, agents found 289 grams of heroin. Inside the kitchen cupboard, agents found over a kilogram of methamphetamine and approximately 200 grams of cocaine, pharmaceutical pills, and marijuana. In a bedroom, agents found 7.4 kilograms of miscellaneous pills and throughout the house were seven firearms and $36,000. Woodson faces up to life in federal prison for his crimes. This case was investigated by the Drug Enforcement Administration. Assistant U.S. Attorney Suzanna Etessam is prosecuting this case.
GUILTY PLEA – LEONEL GENARO YANEZ
On September 22, Leonel Genaro Yanez, 47, plead guilty to possession with intent to distribute a methamphetamine. Yanez, an illegal immigrant from Morelia, Mexico, met an individual in Mesquite, Texas where he purchased car audio speakers which he knew contained 20 kilograms of methamphetamine. Yanez planned to distribute the narcotics to an individual who was taking the speakers to Florida. Yanez faces up to 20 years in federal prison for his crimes. This case was investigated by the Drug Enforcement Administration. Assistant U.S. Attorney Rachael Jones is prosecuting this case.
Multinational Industrial Engineering Company to Pay $22 Million to Settle False Claims Act Allegations of Evading Customs DutiesRead the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams and Acting Assistant Attorney General Jeffrey Bossert Clark announced that Linde GmbH and its U.S. subsidiary Linde Engineering North America LLC (LENA) (together, “Linde”) have agreed to pay the United States more than $22.2 million to resolve allegations that Linde violated the False Claims Act by knowingly making false statements on customs declarations to avoid paying duties owed on the companies’ imports.
Linde GmbH is a multinational corporation headquartered in Germany that, among other things, imports materials into the United States for use in the construction of natural gas and chemical plants. LENA, based in Houston, conducted portions of Linde’s United States business and managed procurement and logistics for Linde. Between 2011 and 2017, Linde imported more than $500 million in goods into the United States.
To enter goods into the United States, an importer must declare, among other things, the country of origin of the goods, the value of the goods, whether the goods are covered by antidumping or countervailing duties, and the amount of duties owed. U.S. Customs and Border Protection (CBP) relies on these representations to determine the correct amount of any duties owed. It is the importer’s affirmative duty to use “reasonable care” to make sure that such information is accurate so that CBP can assess the proper duties.
The United States alleged that, between 2011 and 2017, Linde avoided duties owed to the United States, including in some instances antidumping and countervailing duties, by misrepresenting the nature, classification, and valuation of imported merchandise, as well as the applicability of free trade agreements.
“Trade policy is a critical part of our nation’s foreign policy,” said First Assistant U.S. Attorney Jennifer Arbittier Williams. “Anti-dumping and countervailing duties ensure that American manufacturers are protected from unfair trade practices, and valuation requirements help to ensure that importers do not have an incentive to use foreign engineers to design or inspect the equipment instead of hiring in the United States.”
“This settlement reflects our commitment to hold accountable those who evade duties owed on imported goods, including antidumping and countervailing duties that level the playing field for U.S. manufacturers,” said Acting Assistant Attorney General Jeffrey Bossert Clark for the Department of Justice’s Civil Division. “The Department of Justice will zealously pursue those who seek an unfair advantage in U.S. markets by bringing underpriced goods into this country.”
“CBP is proud to work with the Department of Justice to enforce our trade laws. Collecting revenue on behalf of the American people is something we take very seriously,” said Brenda Smith, Executive Assistant Commissioner, CBP Office of Trade. “We are glad to have come to an equitable and productive solution.”
Prior to the United States’ disclosure to Linde of its investigation, Linde initiated a voluntary disclosure to CBP regarding its importing practices. Since that time, Linde has cooperated with the investigation and worked to overhaul and improve its customs compliance program.
First Assistant U.S. Attorney Williams praised Linde’s work in addressing the issues in these programs: “We commend Linde for coming forward with these issues and working to ensure both that the government is made whole and that these issues will not recur. We hope this settlement will serve as a message to other importers to ensure that they have compliance processes in place that can detect problems before they grow. Importers have an obligation to scrutinize their practices and promptly report issues if they discover that they have not lived up to their obligations.”
The settlement with Linde resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. The civil lawsuit was filed in the Eastern District of Pennsylvania and is captioned United States ex rel. Johnson v. Linde AG, et al., No. 17-cv-1012. As part of today’s resolution, Ms. Johnson will receive approximately $3.7 million. The qui tam complaint was filed by Stephen Hasegawa of Phillips & Cohen in San Francisco.
“We thank the relator and relator’s counsel for their contributions to this case. Without information from citizens like the relator, detecting fraud and conserving government program funds would be much more difficult,” said First Assistant U.S. Attorney Williams.
The settlement was the result of a coordinated effort among the U.S. Attorney’s Office for the Eastern District of Pennsylvania and the Commercial Litigation Branch of the Justice Department’s Civil Division, with assistance from CBP’s Office of Chief Counsel and CBP’s Regulatory Audit and Agency Advisory Services. Assistant United States Attorneys Paul W. Kaufman and Landon Y. Jones III of the Eastern District of Pennsylvania and trial attorney Jennifer Chorpening of the Civil Frauds section of the Department of Justice handled the investigation and settlement.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Multinational Industrial Engineering Company to Pay $22 Million to Settle False Claims Act Allegations Relating to Evaded Customs DutiesRead the Press Release
Linde GmbH and its U.S. subsidiary Linde Engineering North America LLC (LENA) (together, “Linde”) have agreed to pay the United States more than $22.2 million to resolve allegations that Linde violated the False Claims Act by knowingly making false statements on customs declarations to avoid paying duties owed on the companies’ imports, the Justice Department announced today.
“This settlement reflects our commitment to hold accountable those who evade duties owed on imported goods, including antidumping and countervailing duties that level the playing field for U.S. manufacturers,” said Acting Assistant Attorney General Jeffrey Bossert Clark for the Department of Justice’s Civil Division. “The Department of Justice will zealously pursue those who seek an unfair advantage in U.S. markets by bringing underpriced goods into this country.”
“Trade policy is a critical part of our nation’s economic stability and security,” said First Assistant U.S. Attorney for the Eastern District of Pennsylvania Jennifer Arbittier Williams. “Anti-dumping and countervailing duties ensure that American manufacturers are protected from unfair trade practices, and valuation requirements help to ensure that importers do not have an incentive to use foreign engineers instead of hiring in the United States.”
“U.S. Customs and Border Protection is proud to work with the Department of Justice to enforce our trade laws. Collecting revenue on behalf of the American people is something we take very seriously,” said Brenda Smith, Executive Assistant Commissioner, CBP Office of Trade. “We are glad to have come to an equitable and productive solution.”
Linde GmbH is a multinational corporation headquartered in Germany that, among other things, imports materials into the United States for use in the construction of natural gas and chemical manufacturing plants. Houston-based LENA managed procurement and logistics for Linde, which imported more than $500 million in goods into the United States between 2011 and 2017.
To enter goods into the United States, an importer must declare, among other things, the country of origin of the goods, the value of the goods, whether the goods are covered by antidumping or countervailing duties, and the amount of duties owed. U.S. Customs and Border Protection (CBP) relies on these representations to determine the correct amount of any duties owed. It is the importer’s affirmative duty to use “reasonable care” to make sure that such information is accurate so that CBP can assess the proper duties.
The United States alleged that, between 2011 and 2017, Linde avoided duties owed to the United States, including in some instances antidumping and countervailing duties, by misrepresenting the nature, classification, and valuation of imported merchandise, as well as the applicability of free trade agreements.
Prior to the United States’ disclosure to Linde of its investigation, Linde made a partial disclosure to CBP regarding its importing practices. In the settlement, the United States acknowledged Linde’s cooperation.
The settlement with Linde resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. The civil lawsuit was filed in the Eastern District of Pennsylvania and is captioned United States ex rel. Johnson v. Linde AG, et al., No. 17-cv-1012. As part of today’s resolution, Ms. Johnson will receive approximately $3.7 million.
The settlement was the result of a coordinated effort among the U.S. Attorney’s Office for the Eastern District of Pennsylvania and the Commercial Litigation Branch of the Justice Department’s Civil Division, with assistance from CBP’s Office of Chief Counsel and CBP’s Regulatory Audit and Agency Advisory Services.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Mount Laurel, NJ Man Arrested and Charged with Almost 30 Counts of Fraud in Connection with Two Business SchemesRead the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Michael Salerno, 51, of Mount Laurel, NJ, was arrested and charged by Indictment with twenty-three counts of wire fraud and six counts of mail fraud in connection with multiple, elaborate fraud schemes.
According to the Indictment, between September 2016 and at least November 2018, the defendant operated a series of businesses, including Black Diamond Forex, L.P., BDF Trading, L.P., Advanta Capital Markets, Inc., and Advanta FX, each of which purported to be in the business of trading foreign currencies. Using a variety of misrepresentations and omissions, Salerno induced victims to pay advance fees—up-front payments of typically more than $1,000—in order to be hired by Salerno’s company. He told the victims that, upon being hired, he would make available to them a pool of $10 million which they could trade on the foreign currency market, and take a generous cut of any profits. Each of these representations was completely false.
To make his fraudulent activities appear legitimate, Salerno held himself out as a sophisticated and successful businessman. According to the Indictment, the defendant claimed to have managed a real estate empire, a portion of which he claimed to have recently sold for $10 million to fund the currency-trading venture. He also claimed that he had been a profitable currency trader. None of this was true, either. In fact, he declared bankruptcy twice, most recently in 2015, and had been evicted multiple times from rental homes for failure to pay rent. In 2005, he pleaded guilty to federal tax charges and was sentenced to 21 months in prison. He failed to disclose any of this to the aforementioned victims before taking their money. Instead, Salerno allegedly collected more than $300,000 in advance fees and used the money for his own benefit.
The defendant’s currency-trading scheme came to a halt when this Office opened a criminal investigation and the Commodity Futures Trading Commission sought and obtained an injunction against Salerno and his businesses in 2018. However, Salerno allegedly turned immediately to a second scheme. Also according to the Indictment, between May 2018 and least December 2019, Salerno operated a company called AccuOne Financial, Inc. AccuOne purported to be in the business of assisting clients in ridding themselves of unwanted automobile leases. It also purported to offer a different set of clients, whose personal credit precluded them from obtaining an automobile lease, access to automobile leases, low interest vehicle loans, and credit repair services. But Salerno failed to do as promised, instead ripping off both sets of clients. According to the Indictment, the defendant took the unwanted vehicles from the first set of clients, made few - if any - of the required lease payments, and then gave the vehicles to the second set of clients who could not obtain their own leases, in exchange for substantial monthly fees. The predictable result of this house of cards-style scheme was that the clients who wanted to get out of their leases either continued to make monthly lease payments for cars they no longer had, or suffered substantial damage to their credit. And the clients who leased cars from AccuOne often had them repossessed without warning. As for Salerno, he netted several hundred thousand dollars from this scheme alone.
“When Salerno’s foreign currency trading scheme came crashing down around him, he very quickly moved on to an alternative way of swindling people out of their money with car leases and loans,” said First Assistant U.S. Attorney Williams. “The damage done by such corrupt financial schemes can be catastrophic to innocent people’s credit and financial security. We will continue to hold those who commit crimes like the ones alleged here accountable for their misdeeds.”
If convicted, the defendant faces a maximum possible sentence of 580 years in prison, three years supervised release, a fine of $7,250,000 and full restitution.
The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Christopher J. Mannion
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Minneapolis Man Pleads Guilty to Arson of St. Paul Car Rental AgencyRead the Press Release
United States Attorney Erica H. MacDonald today announced the guilty plea of MATTHEW SCOTT WHITE, 32, to one count of arson. WHITE, who was arrested and charged on June, 29, 2020, entered his guilty plea today before Judge Wilhelmina M. Wright in U.S. District Court in Minneapolis, Minnesota.
According to the defendant’s guilty plea, on May 28, 2020, WHITE entered an Enterprise Rent-A-Car building located in St. Paul, Minnesota. While inside the building, WHITE and a juvenile accomplice maliciously started a fire inside a back office. WHITE fueled the fire by throwing papers and other flammable items onto the flames. On June 3, 2020, investigators with the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) examined the scene and determined that the fire was caused by arson and originated from within the structure. The Enterprise Rent-A-Car was totally destroyed by the fire.
This case is the result of an investigation conducted jointly by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the FBI, the St. Paul Police Department, and the Minnesota State Fire Marshal Division.
This case is being prosecuted by Assistant U.S. Attorney Bradley M. Endicott.
Defendant Information:
MATTHEW SCOTT WHITE, 32
Minneapolis, Minn.
Convicted:
- Arson, 1 count
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Milan Resident Sentenced to 72 Months in Scheme to Defraud Amtrak, While Possessing Firearms, Explosives, and NarcoticsRead the Press Release
A Milan, Michigan resident was sentenced to 72 months in federal prison after having pleaded guilty to charges of wire fraud and aggravated identity theft in a scheme to defraud Amtrak and others, along with firearms offenses, announced United States Attorney Matthew Schneider.
Schneider was joined in the announcement by John R, Lausch, Jr., United States Attorney for the Northern District of Illinois, Special Agent in Charge Basil Demczak, Amtrak Office of Inspector General, Central Field Office Special Agent in Charge Christopher Diiorio, United States Secret Service, Chicago Field Office, and Special Agent in Charge James Deir, Bureau of Alcohol, Tobacco, Firearms and Explosives, Detroit Division.
Sentenced was Christian Newby, 32. Newby was sentenced by United States District Judge Gershwin Drain. As part of his plea agreement, Newby agreed to the entry of a $550,000 money judgment and to forfeit any and all property derived from the scheme to include a Rolex watch and other jewelry.
According to court records, from March 2018 through January 2019, Newby fraudulently obtained credit card information for more than 1100 credit card holders. Newby used the stolen credit card information to purchase Amtrak tickets online. After purchasing the tickets, Newby would then cancel the Amtrak tickets and receive vouchers for the value of those tickets from Amtrak. Newby then advertised and sold the Amtrak vouchers to unwitting buyers on eBay at a fraction of the cost. This was all done without the knowledge or consent of the true card holder. As a result of this scheme, Amtrak suffered a loss of more than $540,000.
As part of the investigation, agents executed a search warrant at Newby’s residence and recovered several improvised explosive devices, narcotics, firearms, and ammunition.
The case was investigated by Special Agent John Donnelly Amtrak-Office of the Inspector General with the assistance of the FBI, Bureau of Alcohol, Tobacco, Firearms and Explosives, the Milan Police Department and the Michigan State Police. The case was prosecuted by Assistant U.S. Attorneys Robert Jerome White, of the Eastern District of Michigan, and Melody Wells, of the Northern District of Illinois.
Maryland Couple Arrested for Selling Explosive Devices to Undercover ATF AgentRead the Press Release
WASHINGTON – Brittany Nicole Adams, 29, of Landover, MD, and Anthony Benson, Jr., 30, of Washington, D.C., have been indicted and arrested for conspiracy to distribute explosive devices and three counts of distribution of explosive devices. The charges were filed in an indictment unsealed in the U.S. District Court for the District of Columbia, announced U.S. Attorney Michael R. Sherwin and Ashan M. Benedict, Special Agent in Charge of the Washington Field Division of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF).
The investigation began after ATF identified advertisements on a website that offered for sale explosive devices described as “Dynamite,” and available for local pickup in Washington, D.C. An undercover agent responded to the ad and arranged to meet with the seller at a predetermined location in Washington, D.C. In June of 2020, ATF agents conducted an undercover controlled purchase of suspected explosive devices after Adams and Benson met with the undercover agent in response to communication related to the sale advertisement. At the meeting, Adams provided the undercover agent with eleven suspected illegal explosive devices in exchange for U.S. currency. Subsequently, on two additional occasions in July of 2020, Adams and Benson met with the undercover agent and again provided to the undercover agent illegal explosive devices in exchange for U.S. currency.
An indictment is merely a formal charge that a defendant has committed a violation of criminal law and is not evidence of guilt. Every defendant is presumed innocent until, and unless, proven guilty.
In announcing the charges, Acting U.S. Attorney Sherwin and Special Agent in Charge Benedict commended the work of those who investigated the case from the Bureau of Alcohol, Tobacco, Firearms, and Explosives. Finally, they cited the efforts of those who worked on the case from the U.S. Attorney’s Office for the District of Columbia, Assistant U.S. Attorney Emory V. Cole of the Federal Major Crimes Section, Paralegal Specialist Teesha Tobias, and Legal Assistant Kate Abrey.
Man in Possession of Sawed-Off Shotgun Sent to Federal PrisonRead the Press Release
A man who illegally possessed a sawed-off shotgun was sentenced today to more than three years in federal prison.
Francisco Rubio, age 25, from Waterloo, Iowa, received the prison term after a guilty plea to possession of an unregistered National Firearms Act device.
In a plea agreement, Rubio admitted that on October 11, 2019, he knowingly possessed a Mossberg 500, 20 gauge sawed-off shotgun with an overall barrel length of less than 18 inches. That day, Waterloo police officers were dispatched to an alleyway behind a residence after receiving a report that individuals were attempting to break into a car. When an officer arrived, he observed Rubio seated in the passenger side of a red car. The driver of the red vehicle was running away from a different vehicle. The driver got into the red car and backed down the alley. Ignoring police commands to stop, the driver continued backing her car down the alley until she reached the roadway. The driver then turned her car onto the road and attempted to flee from the police. During the pursuit, the driver turned her car onto another alleyway. While they were traveling down this alleyway, Rubio threw the sawed-off shotgun out of his passenger window
Rubio was sentenced in Cedar Rapids by United States District Court Judge C.J. Williams. Rubio was sentenced to 46 months’ imprisonment. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
This case was brought as part of Project Safe Neighborhoods (PSN). PSN is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime.
Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
This case is also part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see /media/1122011/dl?inline.
Rubio is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Lisa C. Williams and investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Waterloo Police Department.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 20-CR-2001.
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Man from Angel Fire charged with cocaine traffickingRead the Press Release
ALBUQUERQUE, N.M. – Louis Richard Montoya, 31, of Angel Fire, New Mexico, appeared in court today for a detention hearing on charges of possession with intent to distribute cocaine. Montoya will remain detained pending trial.
According to a federal criminal complaint, Montoya allegedly possessed approximately 6.6 kilograms of cocaine when he was stopped at a U.S. Border Patrol checkpoint west of Alamogordo, New Mexico. If convicted, Montoya faces 10 years to life in prison.
A criminal complaint is only an accusation. A defendant is presumed innocent unless and until proven guilty.
The U.S. Border Patrol investigated this case. Assistant U.S. Attorney Clara Cobos is prosecuting the case.
Man Who Bought 7 Firearms for Convicted Felon Pleads GuiltyRead the Press Release
ALEXANDRIA, Va. – A Fredericksburg man pleaded guilty today to lying on an ATF form in the course of straw-purchasing seven firearms for a convicted felon and criminal street gang member.
According to court documents, following the recovery of a firearm by the Metropolitan Police Department that had been purchased just one week prior, ATF agents reviewed firearm transaction records and determined that Chad Thomas Lamph, 22, had purchased that firearm and numerous others from federal firearms licensees in December of 2019. For each firearm that he purchased, Lamph certified on ATF Form 4473 that he was the actual transferee / buyer. However, the ATF’s investigation revealed that Lamph had in fact purchased seven of those firearms on behalf of another individual he knew to be a convicted felon and criminal street gang member in exchange for money.
Lamph pleaded guilty to making a false statement with respect to information required to be kept in the records of a federal firearms licensee. Lamph faces a maximum penalty of 5 years in prison when sentenced on December 11. 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.
This case is part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. Click here for more information about Project Guardian.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia; Ashan M. Benedict, Special Agent in Charge of the ATF’s Washington Field Division; and Peter Newsham, Chief of the D.C. Metropolitan Police Department, made the announcement after Senior U.S. District Judge Claude M. Hilton accepted the plea. Assistant U.S. Attorneys John C. Blanchard and Ryan B. Bredemeier are prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:20-cr-225.
Long Island Man Agrees to Donate Personal Protective Equipment Valued at More Than $450,000 to Resolve Price-Gouging CaseRead the Press Release
CENTRAL ISLIP, NY – An agreement was filed today in federal court in Central Islip resolving the criminal case against Amardeep Singh, who was charged in April 2020 with violating the Defense Production Act of 1950 by hoarding personal protective equipment (PPE) amid the COVID-19 pandemic and price-gouging customers of his retail store. Under the terms of his Deferred Prosecution Agreement with the Government, Singh will donate PPE valued at more than $450,000 to hospitals, health care providers, first responders and other essential workers involved with addressing the needs of those affected by the pandemic and working to prevent the spread of COVID-19.
Seth D. DuCharme, Acting United States Attorney for the Eastern District of New York, Craig Carpenito, head of the Department of Justice’s nationwide COVID-19 Hoarding and Price Gouging Task Force, and Philip R. Bartlett, Inspector-in-Charge, United States Postal Inspection Service, New York Division (USPIS), announced the disposition.
“The defendant has accepted responsibility for taking advantage of a public health emergency for personal profit,” stated Acting United States Attorney DuCharme. “Today’s deferred prosecution agreement is a victory for heroic healthcare workers and first-responders who will benefit from the personal protective equipment relinquished by the defendant in their continuing battle against the COVID-19 virus.”
“This defendant’s attempt to charge unnecessarily high prices for badly needed and vitally important protective gear was an early example of how some people will try to unscrupulously profit from a national health care emergency,” stated head of the Department of Justice’s nationwide COVID-19 Hoarding and Price Gouging Task Force Carpenito. “Today’s agreement thwarts that attempt, and resolves the matter by getting this personal protective equipment to the people who need it.”
“Mr. Singh took advantage of being the ‘only game in town’ with PPE during the height of the coronavirus pandemic, by jacking up the prices on life-saving equipment needed by first responders, medical personnel and the general public. Singh held himself out as a local hero but we now know this was totally untrue,” stated USPIS Inspector-in-Charge Bartlett.
On March 18, 2020, in response to the COVID-19 pandemic, President Donald Trump issued Executive Order 13909 invoking the Act making it illegal to acquire medical supplies and devices designated by the Secretary of Health and Human Services as scarce in order to hoard them or sell them for excessive prices.
On April 14, 2020, Postal Inspectors executed a search warrant at Singh’s retail store and a consensual search of the warehouse and seized 23 pallets containing more than 100,000 face masks, 10,000 surgical gowns, nearly 2,500 full-body isolation suits and more than 500,000 pairs of disposable gloves.
On April 24, 2020, Singh became the first person in the nation charged with violating the Act after accumulating merchandise, some of which had been officially designated as scarce, at his retail store in Plainview, and at a warehouse in Brentwood, including 40 shipments of disposable face masks weighing more than 1.6 tons, 14 shipments of disposable surgical gowns weighing more than 2.2 tons, six shipments of hand sanitizer weighing more than 1.8 tons and seven shipments of digital thermometers weighing approximately 253 pounds. Singh then sold those items to the public at inflated prices.
Attorney General William P. Barr created the COVID-19 Hoarding and Price Gouging Task Force, led by Craig Carpenito, United States Attorney for District of New Jersey, who is coordinating efforts with the Antitrust Division and U.S. Attorneys across the country wherever illegal activity involving protective personal equipment occurs. The Secretary of Health and Human Services has issued a Notice designating categories of health and medical supplies that must not be hoarded or sold for exorbitant prices.
Please report COVID-19 fraud, hoarding or price-gouging to the National Center for Disaster Fraud’s National Hotline at (866) 720-5721, or e-mail: [email protected].
The government’s case is being prosecuted by the Office’s Long Island Criminal Division, with assistance from the Department of Justice’s Hoarding and Price-Gouging Task Force. Assistant United States Attorney Anthony Bagnuola is in charge of the prosecution.
The Defendant:
AMARDEEP SINGH (also known as “Bobby Singh” and “Bobby Sidana”)
Age: 45
Woodbury, New YorkE.D.N.Y. Docket No. 20-MJ-326
Le Mars Man Pleads Guilty to COVID-19 Related Unemployment FraudRead the Press Release
A Le Mars, Iowa man who stole government funds using a COVID-19 unemployment scheme pled guilty today in federal court in Sioux City.
Dennis George Chinn, age 54, from Le Mars, Iowa, was convicted of theft of government funds.
In a plea agreement, Chinn admitted to falsely reporting his income, stating it was $150 per week so he could get an additional $600 weekly payment, and fraudulently obtaining unemployment benefits related to COVID-19 relief funds to which he was not entitled. In total, Chinn obtained over $13,000 in COVID-19 pandemic CARES Act Iowa unemployment funds.
Sentencing before United States District Court Chief Judge Leonard T. Strand will be set after a presentence report is prepared. Chinn remains free on bond pending sentencing. Chinn faces a possible maximum sentence of 10 years’ 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 United States Department of Labor and the Office of Inspector General and the Federal Bureau of Investigation.
Rooting out COVID-19 fraud is a priority of the Department of Justice. On March 27, 2020, the President signed the CARES Act, which provides emergency assistance to individuals, families, and businesses affected by the COVID-19 pandemic, including increased unemployment benefits.
These prosecutions are an example of the Department of Justice’s strong commitment to combating fraud and criminal activity related to the COVID-19 pandemic. Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 20-CR-4082.
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Latin Dragon Nation Associate Sentenced to 60 Months in PrisonRead the Press Release
HAMMOND- Angelina Vilella, 21, of Chicago, Illinois, was sentenced to 60 months of imprisonment following her guilty plea to conspiracy to participate in racketeering activity as an associate of the Latin Dragons Nation street gang, announced U.S. Attorney Kirsch.
According to documents in the case, the Latin Dragons Nation is a criminal street gang that originated in Chicago and spread to other areas, including the Northern District of Indiana. Members and associates of the Latin Dragons Nation allegedly engage in acts of violence, including murder, attempted murder, witness tampering, and assault, to protect the gang’s territory. The Latin Dragon Nation members have been charged with crimes involving in excess of 50 victims, including 15 murder victims.
As part of her involvement in the Latin Dragons Nation, Vilella participated with gang members and associates in acts of violence and other criminal activity. In May 2017, Vilella caused stolen checks to be deposited into her account and the accounts of others. In June 2017, at the direction of a Latin Dragon Nation member, Vilella and another Latin Dragon associate provided a firearm previously used to commit a murder to another Latin Dragon Nation member, with the intention that he would dispose of the murder weapon. In this case, a total of 19 members and associates have been charged with racketeering conspiracy for their participation in Latin Dragon Nation activity. Of those, 14 defendants have pled guilty and 9 are awaiting sentencing.
This case is the result of the investigative efforts of the Federal Bureau of Investigation; the Bureau of Alcohol, Tobacco, Firearms, and Explosives; the Chicago Police Department Criminal Enterprise Unit; the Cook County Sheriff’s Office; the Bartlett Police Department; the Hammond Police Department; the East Chicago Police Department; the Merrillville Police Department; the Hobart Police Department; the Lake County Sheriff’s Department; and the Calumet City Police Department, with assistance from the Lake County, Indiana Prosecutor’s Office, the Cook County, Illinois State’s Attorney’s Office, the Indiana Department of Corrections, and the Illinois Department of Corrections. This case is being prosecuted by Assistant U.S. Attorneys Joseph A. Cooley, Kevin F. Wolff, Maria N. Lerner, and Special Assistant U.S. Attorney Michael J. Toth.
Justice Department Calls on San Francisco Mayor to End “One Congregant” Rule for Places of Worship to Comply with the ConstitutionRead the Press Release
The Justice Department today sent a letter to San Francisco mayor explaining that the city’s policy of only allowing a single worshiper in places of worship regardless of their size, while allowing multiple patrons in other indoor settings including gyms, tattoo parlors, hair salons, massage studios, and daycares, is contrary to the Constitution and the nation’s best tradition of religious freedom.
The letter, sent by Assistant Attorney General for the Civil Rights Division Eric Dreiband and U.S. Attorney for the Northern District of California, David Anderson, explains that San Francisco’s policy of treating secular businesses more favorably than houses of worship is “wholly at odds with this nation’s traditional understanding of religious liberty, and may violate the First Amendment,” and calls on the mayor to take action to treat places of worship equally with other venues where people share enclosed spaces.
“No government in this free country can attack religion by transforming a house of worship arbitrarily into a place for solitary confinement. People of faith go to churches, synagogues, mosques, and other places to worship with their fellow believers, and they can do so lawfully because the First Amendment to the United States Constitution makes illegal any effort by government to prohibit the free exercise of religion,” said Assistant Attorney General Eric Dreiband. “That we are dealing with a very serious public health crisis does not permit government to discriminate against religious worshipers by imposing a one-person-per-house-of-worship rule while permitting larger numbers of people to gather in tattoo parlors, hair salons, massage studios, and other places. There is no pandemic exception to the United States Constitution and its Bill of Rights.”
While continuing to enforce the one-congregant rule, San Francisco allows patrons at gyms, hair and nail salons, tattoo parlors, and massage studios so long as 6-foot distancing is followed. Gyms are allowed to open at 10 percent of capacity, daycares to operate with 10 to 12 children per class, and retail establishments generally can operate at 50 percent of capacity.
The letter calls on the city to immediately equalize its treatment of places of worship to comply with the First Amendment.
On April 27, 2020, Attorney General William P. Barr directed Assistant Attorney General for Civil Rights, Eric Dreiband, and the U.S. Attorney for the Eastern District of Michigan, Matthew Schneider, to review state and local policies to ensure that civil liberties are protected during the COVID-19 pandemic.
Jury Convicts KC Man of Possessing FirearmRead the Press Release
KANSAS CITY, Mo. – A Kansas City, Missouri, man was convicted at trial of illegally possessing a firearm.
Kenneth E. Barbee Jr., 33, was found guilty on Wednesday, Sept. 23, of being a felon in possession a firearm.
Detectives with the Kansas City, Mo., Police Department were conducting surveillance on Barbee on March 18, 2020, when he left his residence in a vehicle driven by another person. After officers stopped the vehicle, the driver attempted to pull away from officers but was forced to stop when officers used their vehicles to block their escape.
When Barbee and the driver were ordered out of the vehicle, officers saw a loaded Palmetto State Armory AR pistol and a loaded CZ 9mm handgun on the front passenger floorboard. The driver of the vehicle had an SCCY 9mm handgun in her waistband.
Under federal law, it is illegal for anyone who has been convicted of a felony to be in possession of any firearm or ammunition. Barbee has a prior felony conviction for assault, a prior felony conviction for domestic assault, two prior felony convictions for receiving stolen property, and a prior felony conviction for robbery.
Following the presentation of evidence, the jury in the U.S. District Court in Kansas City, Mo., deliberated for three hours before returning the guilty verdict to U.S. District Judge Roseann Ketchmark, ending a trial that began Monday, Sept. 21.
Under federal statutes, Barbee is subject to a sentence of up to 10 years in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorneys Mary Kate Butterfield, Patrick Edwards, and Gregg Coonrod. It was investigated by the Kansas City, Mo., Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Project Safe Neighborhoods
The U.S. Attorney’s Office is partnering with federal, state, and local law enforcement to specifically identify criminals responsible for significant violent crime in the Western District of Missouri. A centerpiece of this effort is Project Safe Neighborhoods, a program that brings together all levels of law enforcement to reduce violent crime and make neighborhoods safer for everyone. Project Safe Neighborhoods is an evidence-based program that identifies the most pressing violent crime problems in the community and develops comprehensive solutions to address them. As part of this strategy, Project Safe Neighborhoods focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.Jacksonville Man Sentenced to 15 Years as an Armed Career Criminal on Firearm Ammunition ChargeRead the Press Release
Jacksonville, Florida – U.S. District Judge Brian J. Davis today sentenced James Aaron Anderson, Jr. (37, Jacksonville) to 15 years in federal prison for possessing ammunition as a convicted felon. Anderson had pleaded guilty on July 2, 2019.
According to court documents, on August 3, 2018, at approximately 2:00 a.m., an officer from the Jacksonville Sheriff’s Office (JSO), in a marked patrol unit, began following a Chevy Tahoe due to signs of a possibly impaired driver. As the officer began to turn on his emergency lights, the Tahoe made a quick lane change in an effort to evade the marked unit. The Tahoe then fled at a high rate of speed, as multiple JSO marked units pursued it. The Tahoe eventually became stuck in a grassy area when it attempted to turn around. JSO officers arrested the driver, whom they identified as Anderson, the sole occupant in the vehicle.
A search of Anderson’s jacket revealed a .22 caliber revolver, loaded with six rounds of ammunition, and drugs. Subsequent investigation by law enforcement determined that Anderson had been previously convicted of eight prior felonies, including six serious drug offenses, qualifying him as an Armed Career Criminal.
This case was investigated by the Jacksonville Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms and Explosives. It was prosecuted by Assistant United States Attorneys Kevin C. Frein and David B. Mesrobian.
This is another case prosecuted as part of the Department of Justice’s “Project Safe Neighborhoods” Program (PSN), which is a nationwide, crime reduction strategy aimed at decreasing violent crime in communities. It involves a comprehensive approach to public safety — one that includes investigating and prosecuting crimes, along with prevention and reentry efforts. In the Middle District of Florida, U.S. Attorney Maria Chapa Lopez coordinates PSN efforts in cooperation with various federal, state, and local law enforcement officials.
Iowa Man Sentenced to over Six Years in Federal Prison for Receiving Child PornographyRead the Press Release
A man who received child pornography was sentenced today to over six years in federal prison.
Shawn Kuhse, age 37, of Wadena, Iowa, received the sentence after a March 13, 2020 guilty plea to one count of receipt of child pornography. In a plea agreement, Kuhse admitted that between October 2018 and April 2019 he received child pornography. Kuhse admitted he used a messaging app on his phone to receive child pornography from other users of the app.
Information disclosed at sentencing showed that Kuhse received over 700 images and 300 videos containing child pornography. The child pornography contained images of prepubescent girls involved in sex acts with adult men, adult women, and animals. Kuhse’s sentence was increased because the child pornography he received depicted sadistic, masochistic, or violent conduct.
Kuhse was sentenced in Cedar Rapids by United States District Court Judge C.J. Williams. Kuhse was sentenced to 78 months’ imprisonment. Kuhse must also serve a five-year term of supervised release, and he must comply with all sex offender registration and public notification requirements.
This case was prosecuted by Assistant United States Attorney Anthony Morfitt and was investigated by the Fayette 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.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is CR 19-2073.
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Informational: Federal Court arraignmentsRead the Press Release
The U.S. Attorney’s Office announced that the following persons were arraigned or appeared this week before U.S. Magistrate judges on indictments handed down by the Grand Jury or on criminal complaints. The charging documents are merely accusations and defendants are presumed innocent until proven guilty:
Appearing in Billings before U.S. Magistrate Judge Timothy J. Cavan and pleading not guilty on Sept. 22 was:
Robert Maurice LaCroix, 53, of Billings, on charges of conspiracy to possess with intent to distribute methamphetamine and possession with intent to distribute meth. If convicted of the most serious crime, LaCroix faces a minimum mandatory five years to 40 years in prison, a $5 million fine and at least five years of supervised release. LaCroix was detained pending further proceedings. The FBI Western Transnational Organized Crime Task Force and the Eastern Montana High Intensity Drug Trafficking Area Task Force investigated the case. PACER case reference. 20-55.
The progress of cases may be monitored through the U.S. District Court Calendar and the PACER system. To establish a PACER account, which provides electronic access to review documents filed in a case, please visit http://www.pacer.gov/register.html. To access the District Court’s calendar, please visit https://ecf.mtd.uscourts.gov/cgi-bin/PublicCalendar.pl.
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Illinois Woman Sentenced to Federal Prison for Tax Fraud and Theft of Government PropertyRead the Press Release
A woman who filed 36 fraudulent tax returns, some using the identities of other people, over a two-year period and stole the subsequent refunds was sentenced today to over a year in federal prison.
Toniece King, age 37, from Evanston, Illinois, received the prison term after a March 16, 2020 guilty plea to one count of theft of government property and one count of false claim for refund of taxes.
Information disclosed at sentencing showed that, King used her own name and the names and social security numbers of others to file fraudulent tax returns from January 2015 through January 2017. In total, she filed 36 fraudulent returns, claiming over $160,000 in refunds. Over $65,000 of the fraudulently claimed refunds was paid out. King received some of these refunds on prepaid debit cards that were found in her possession in March 2016.
King was sentenced in Cedar Rapids by United States District Court Judge C.J. Williams. King was sentenced to fourteen months’ imprisonment. She was ordered to make $65,481 in restitution to the Internal Revenue Service. She must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
King was released on the bond previously set and is to surrender to the Bureau of Prisons on a date yet to be set.
The case was prosecuted by Assistant United States Attorney Anthony Morfitt and investigated by the Internal Revenue Service - Criminal Investigations and the Cedar County Sheriff’s Office.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 19-CR-118.
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Illegal Alien from Mexico Sentenced to over 16 Years in Prison for Drug Conspiracy Involving Drugs Sold Near Children’s HospitalRead the Press Release
Jackson, Miss. – Edgar Leonel Soto-Leon, 32, an illegal alien from Mexico, was sentenced today by U.S. District Judge Henry T. Wingate to serve 195 months in federal prison, followed by five years of supervised release, for conspiracy to distribute 2.6 pounds of methamphetamine and 2.1 pounds of heroin, announced U.S. Attorney Mike Hurst and Brad L. Byerley, Special Agent in Charge of the Drug Enforcement Administration (DEA).
In May, 2019, Soto-Leon and his co-defendant Matthew Williams, reached an agreement to distribute heroin and methamphetamine. To assist Soto-Leon, Williams made contact with one or more individuals in order to find a buyer for illegal drugs in the possession of Soto-Leon. Through these contacts by Williams, a buyer was identified. Williams spoke directly to the buyer and stated that Soto-Leon was in possession of approximately 3 pounds of methamphetamine known as “ICE” and one kilogram of heroin that he was trying to sell. Williams connected the buyer to Soto-Leon, who began communicating directly with the buyer. Soto-Leon and the buyer reached an agreement on the price for all of the methamphetamine and heroin.
Unknown to either Williams or Soto-Leon, the buyer was actually an undercover agent.
On May 2, 2019, Soto-Leon and the buyer met at a location near the Blair E. Batson Hospital in Jackson where Soto-Leon provided the buyer with methamphetamine and heroin. Williams had assisted the buyer and Soto-Leon by giving them directions to the place where they met. Lab tests later confirmed that Soto-Leon had provided 414.7 grams of methamphetamine which was 99% pure and 424.2 grams of heroin.
On May 3, 2019, Soto-Leon and the buyer met again at a location in Pearl, Mississippi, where Soto-Leon again gave the buyer methamphetamine and heroin. Lab tests later confirmed that Soto-Leon had provided 772.4 grams of methamphetamine which was 98% pure and two containers of heroin containing 344.6 grams heroin and 228.8 grams of heroin. Once the second batch of controlled substances were given to the buyer, law enforcement immediately arrested Soto-Leon. Williams was arrested a few days later.
In total, Soto-Leon and Williams conspired to sell and sold 2.6 pounds of methamphetamine and 2.1 pounds of heroin to the undercover DEA officer. The methamphetamine sold is a type of methamphetamine known as “ICE” due to its purity.
The defendants were indicted and both pled guilty before Judge Wingate on October 18, 2019. Williams was sentenced by Judge Wingate on July 2, 2020 to 146 months in prison.
The case was investigated by the DEA, the Hinds County Sheriff’s Department, the Jones County Sheriff’s Department, the Pearl Police Department, and the Richland Police Department. The case is being prosecuted by Assistant United States Attorney Dave Fulcher.
Illegal Alien Sentenced to 60 Months in Federal Prison for Role in $4.7 Million Mail/Wire/Healthcare Fraud and Money Laundering SchemeRead the Press Release
Spokane – William D. Hyslop, United States Attorney for the Eastern District of Washington, announced that Misael Reyes-Tajimaroa, age 36, of Michoacan, Mexico, was sentenced after having pleaded guilty to one count of healthcare fraud conspiracy, one count of mail and wire fraud conspiracy, eight counts of mail fraud, one count of wire fraud, one count of money laundering conspiracy, and one count of money laundering. United States District Judge Thomas O. Rice sentenced Reyes-Tajimaroa to a 60-month term of imprisonment, to be followed by a 3- year term of court supervision after he is released from federal prison. Judge Rice also ordered Reyes-Tajimaroa to pay restitution in the amount of $500,000.
According to information disclosed during court proceedings, Reyes-Tajimaroa, an illegal alien who was residing at various times in Spokane County, Washington, and Clark County, Nevada was an integral member of an extensive healthcare/mail/wire fraud scheme that staged automobile, boating and slip and fall accidents in Spokane, Washington, Liberty Lake, Washington, Coeur d’Alene, Idaho, Shingle Springs, California, Rescue, California, Las Vegas, Nevada and Henderson, Nevada that defrauded insurance companies out of approximately $4.7 million by filing fraudulent bodily injury claims. Reyes-Tajimaroa played “injured” victim, “getaway” driver or “lookout” in approximately sixteen of the phony accidents and received medical treatment for fictitious or intentionally inflicted injuries to various parts of his body. After one phony accident, Reyes-Tajimaroa was airlifted via helicopter to a hospital by first responders. As part of the staging in another accident, Reyes-Tajimaroa used pliers to break off his teeth. Reyes-Tajimaroa also conspired with others to launder money from the fraudulent insurance claims.
United States Attorney Hyslop said, “Reyes-Tajimaroa was involved in a sophisticated and elaborate fraud and money laundering scheme that operated in four different states. Fraud schemes like these ultimately increase insurance premiums and health care costs for law-abiding citizens. The United States Attorney’s Office for the Eastern District ofWashington is resolute in prosecuting aggressively those individuals who may engage in such conduct. I commend the FBI, IRS Criminal Investigation and U.S. Marshals Service for their outstanding work investigating this case.”
FBI Special Agent in Charge Raymond Duda said,“Greed tempts people to do many things, and in this case, even causing self-harm. However, the harm inflicted on honest consumers did not seem to be of any concern to him or his co-conspirators. Mr. Reyes-Tajimaroa will now have the next 42 months to consider whether his participation in this scheme was worth it.”
“Misael Reyes-Tajimaroa directly participated in staged accidents to purposely mislead first responders about his and other’s bodily injuries and by doing so endangered the public who suffered from real emergencies,” said IRS-Criminal Investigation (IRS-CI) Special Agent in Charge Justin Campbell. “IRS-CI will continue to work with the U.S. Attorney’s Office and its law enforcement partners to hold accountable all who conspire to commit fraud.”
This case was investigated by the Federal Bureau of Investigation, Internal Revenue Service Criminal Investigation, U.S. Marshals Service and U.S. Attorney’s Office for the Eastern District of Washington Criminal Healthcare Fraud Investigator, with assistance from the National Insurance Crime Bureau. This case was prosecuted by George J.C. Jacobs, III, and Brian Donovan, Assistant United States Attorneys for the Eastern District of Washington.
Illegal Alien Sentenced for Assaulting A Federal OfficerRead the Press Release
An illegal alien was sentenced yesterday to 18 months’ in federal prison for assaulting a federal officer, announced United States Attorney Matthew Schneider.
Schneider was joined in the announcement by Special Agent in Charge Vance Callendar, Homeland Security Investigations, Detroit Division.
U.S. Attorney Matthew Schneider stated, “Our office continues to prosecute dangerous and violent offenders who are in our country illegally. Our mission is to protect our community from violent criminals, and we will continue to do that by working with our law enforcement partners to keep our borders safe.”
“An assault on a law enforcement officer is unobjectionable, and this individual, illegally present in the U.S., will now face time for his actions. HSI will continue to work with the U.S. Attorney’s Office for the Eastern District of Michigan for the investigation and prosecution of those who think they can operate above the law,” said Vance Callender, special agent in charge for HSI Detroit.
Sentenced was Enrique Ortega-Escudero, age 37. According to court records, Enrique Ortega-Escudero assaulted a federal officer during an immigration arrest on February 2, 2020. During his arrest, Mr. Ortega-Escudero resisted and fought with the ICE agents. While being transported in an ambulance to Detroit Receiving Hospital for evaluation, Mr. Ortega-Escudero escaped. He did so by opening the side door of the rear compartment while the ambulance was moving on Interstate 75 and ran across both lanes of traffic on the interstate. Following a foot pursuit, Mr. Ortega-Escudero again fought with an ICE agent and attempted to remove the agent’s firearm. With assistance from EMTs, Mr. Ortega-Escudero was again detained; however, the ICE agent suffered physical injuries.
Mr. Ortega-Escudero’s case is just one of the many immigration enforcement cases being prosecuted by the United States Attorney’s Office. Since January 1, 2020, the U.S. Attorney’s Office has investigated or prosecuted approximately 80 immigration-related cases despite the increased challenges posed by the current environment. A sampling of cases are highlighted below:
Among those recently prosecuted is Hector Ramirez-Gutierrez, who repeatedly entered the U.S. illegally and used over four dozen aliases during three decades of committing crimes in the United States. Mr. Ramirez-Gutierrez’s lengthy criminal history includes convictions for grand theft, burglary, battery, infliction of corporal injury on a spouse or co-habitant, driving under the influence, and multiple immigration offenses, among others. Most recently, Mr. Ramirez-Gutierrez violated his supervised release by returning unlawfully to the United States after his removal on September 19, 2019 and committing additional theft offenses in early 2020. Mr. Ramirez-Gutierrez was charged with unlawful reentry and sentenced on June 24, 2020 and August 12, 2020 to two consecutive 24 month sentences for the supervised release and unlawful reentry violations.
Gaspar Vallejo-Arias was a lawful permanent resident of the United States until he was convicted for conspiracy to commit Hobbs Act robbery and removed to the Dominican Republic on April 7, 2015. That crime involved Mr. Vallejo-Arias’ participation in a scheme to rob a drug dealer of a large amount of cocaine. Mr. Vallejo-Arias also had other felony convictions for auto-stripping and forgery. Following his removal, Mr. Vallejo-Arias unlawfully reentered the United States and was arrested near St. Clair, Michigan on February 4, 2020. He was charged with unlawful reentry and he was sentenced on June 17, 2020 to time-served.
Rolando Lopez-Lopez was convicted on February 8, 2018 of Operating while Intoxicated Causing Death and Reckless Driving Causing Death in the Third Circuit Court, Detroit, Michigan. For those offenses, he was sentenced to 5 to 15 years’ imprisonment. Mr. Lopez-Lopez had previously been removed from the United States on January 11, 2006. On June 18, 2020, Mr. Lopez-Lopez was charged with unlawful reentry and was sentenced on September 10, 2020 to time-served.
On May 27, 2020, Eduardo Delgado-Campos was convicted of false use of a passport and unlawful reentry. Delgado-Campos was sentenced to six months’ imprisonment for those offenses. Previously, Mr. Delgado-Campos had been convicted of two drug offenses and unlawful entry into the United States. Before his most recent federal conviction, Mr. Delgado-Campos had been removed from the United States by immigration authorities six times.
The U.S. Attorney’s Office routinely investigates and prosecutes alien smuggling, port-running, identity theft, passport fraud, the hiring and exploitation of unauthorized workers, and other immigration offenses that negatively impact the rule of law, public safety, and border security.
Houston woman sent to federal prison for adoption fraud schemeRead the Press Release
HOUSTON – The former owner of a child placement agency in Houston has been ordered to prison following her convictions on multiple counts in an adoption fraud scheme, announced U.S. Attorney Ryan K. Patrick along with Special Agent in Charge Perrye K. Turner of the FBI.
The Houston federal jury convicted Simone Swenson, 46, on two counts of mail fraud following a five-day trial Sept. 29, 2019.
Today, Chief U.S. District Judge Lee H. Rosenthal handed Swenson a 24-month sentence to be immediately followed by three years of supervised release. At the hearing, the court heard from eight of 2o identified victims as well as an FBI agent who described Swenson’s common scheme and plans to defraud numerous adoptive families. In handing down the sentence, the court noted Swenson lied, concealed information and made false representations to vulnerable adoptive families and victims.
"Simone Swenson took advantage of hopeful adoptive parents who have already been through a difficult journey,” said Turner. “She used these couples as her personal piggy bank and took advantage of them financially and emotionally. This was a seven year-long investigation for FBI Houston that focused not only on a 'poorly-run business', but on an individual whose greed and deceit forever scarred individuals who simply wanted to form a family."
Swenson owned and operated Sans Pareil Center for Children and Family Services LLC which was licensed to operate as both a foster care and child adoption agency. Swenson is no longer operating Sans Pareil following suspension of her license.
At trial, the jury heard Sans Pareil catered to adoptive families that desired to participate in domestic private (non-CPS) adoption program. From on or about January 2013 to on or about January 2014, Swenson defrauded numerous prospective adoptive families with the same birth mother, a scheme known as double matching. In addition to double matching, she obtained money and property by means or materially false and fraudulent pretenses, representations and promises.
Testimony revealed Swenson double matched birth mothers who expected to have only one baby to multiple adoptive families. Once prospective family members wired money and/or mailed it into her accounts, Swenson would find a way, through lies and misrepresentations, to get out of the agreements. Such falsehoods included blaming the birthmother for changing her mind, adoptive families backing out of the match and/or blaming adoptive families for lack of funds in some instances.
The jury heard from six adoptive families who testified Swenson would contact prospective families about birth mothers but would not proceed until agency fees and expenses were paid up front. Swenson would then make promises for a successful adoption. In reliance upon those false representations, prospective adoptive families hired attorneys and other adoption agencies, purchased airline tickets, booked hotel rooms, prepared and purchased items for the expected child’s nursery and transportation and incurred other expenses related to the prospective adoption.
Swenson was always available and responsive to prospective adoptive families prior to receiving agency fees. However, once she received monies from those people, she would become unavailable and would not return phone calls for long periods of time, if at all. When she did have communication with them, she would be brief, inconsiderate and provide vague information regarding the birth mothers and their delivery status.
In addition, Swenson rarely provided invoices or receipts to the adoptive families for their paid fees and expenses. When adoptive families would ask Swenson for proof of payment, she did not respond unless there was money to be collected.
Swenson charged each family member approximately $20,000 to $30,000 each.
Swenson attempted to convince the jury that she was negligent and ran a poor business but did not intentionally defraud the adoptive families.
The jury did not believe those claims and found her guilty.
Swenson was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.
Herkimer County Man Sentenced to 20 Years for Child Pornography OffensesRead the Press Release
SYRACUSE, NEW YORK – Daniel M. Passero, Jr., age 35, formerly of Herkimer County, New York, was sentenced today in federal court in Binghamton to serve 20 years in prison for receiving and possessing child pornography.
The sentence was announced by Acting United States Attorney Antoinette T. Bacon, by Kevin M. Kelly, Special Agent in Charge of the Buffalo Field Office of Homeland Security Investigations (HSI).
During Passero’s July 2019 jury trial, the evidence demonstrated that Passero downloaded hundreds of sexually explicit images of children and saved them to a memory card that was later found in a smartphone recovered at Passero’s home. At the time of the offense, Passero was on parole for a prior sex offense against a child, as a result of which he has been designated a Level 3 sexually violent offender by the New York State Division of Criminal Justice Services, Sex Offender Registry.
At sentencing, Senior United States District Judge Thomas J. McAvoy found that Passero had engaged in a pattern of sexual exploitation of children, in that Passero had sexually abused at least two minor children. In addition to the 20-year prison term, Judge McAvoy imposed a 20-year term of supervised release, which will start after Passero is released from prison. Judge McAvoy also ordered Passero to pay $3,000 in restitution to each of four individual victims.
This case was investigated by Homeland Security Investigations (HSI), the New York State Department of Corrections and Community Supervision, and the New York State Police, with assistance from the Gloversville Police Department, Federal Bureau of Investigation (FBI), Burlington Police Department, and Iowa Division of Criminal Investigations.
This case was prosecuted by Assistant U.S. Attorneys Michael F. Perry and Kristen Grabowski, as a part of Project Safe Childhood. Launched in May 2006 by the Department of Justice, Project Safe Childhood is led by United States Attorney’s 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 https://www.justice.gov/psc.
Head of Investment Management Firm Sentenced to 85 Months in Prison in Connection with $18 Million Pre-IPO Securities Fraud SchemeRead the Press Release
Audrey Strauss, the Acting United States Attorney for the Southern District of New York, announced today that FRED ELM, a/k/a “Frederic Elmaleh,” the founder and manager of Elm Tree Investment Advisors LLC (“ETIA”), was sentenced today to 85 months in prison for participating in a scheme to defraud investors in multiple investment funds created and controlled by ELM and Ahmad Naqvi, ETIA’s chief operating officer. Among other illicit activity, ELM and Naqvi fraudulently induced more than 50 investors to invest over $18 million based on false representations that investor money would be invested, through the funds, in the shares of well-known privately held technology companies before their initial public offerings (“IPOs”). Instead, the majority of investor funds was misappropriated for personal use, lost through poor trading, or used to repay investors in a Ponzi-like fashion. ELM pled guilty to conspiracy to commit securities fraud and securities fraud on May 15, 2020, before U.S. District Judge Edgardo Ramos, who also imposed today’s sentence. Naqvi pled guilty before Judge Ramos on May 4, 2020, and was sentenced on June 29, 2020.
Acting U.S. Attorney Audrey Strauss said: “Fred Elm told investors the Elm Tree Funds would generate huge profits from investments in privately held technology companies. In fact, the Elm Tree Funds never invested in these pre-IPO companies and never returned a profit. Further, Elm lied to investors to conceal that their money was being comingled, misused, and lost. Now Elm is headed to prison for his crimes.”
According to the Superseding Indictment charging ELM and Naqvi, and other filings in the case:
From at least June 2013 through December 2014, ELM and Naqvi engaged in a scheme to defraud investors in funds that ELM and Naqvi created and controlled at ETIA, where ELM was the founder and manager, and Naqvi was the chief operating officer. ELM and Naqvi raised more than $18 million from over 50 investors in four limited partnerships for which ETIA acted as the fund manager: Elm Tree Investment Fund, LP; Elm Tree Emerging Growth Fund, LP; Elm Tree ‘e’Conomy Fund, LP; and Elm Tree Motion Opportunity, LP (collectively the “Elm Tree Funds”).
ELM and Naqvi falsely represented that the Elm Tree Funds used investor capital to purchase shares in privately held technology companies before their IPOs. These companies included Twitter, Alibaba, Uber, Square, Pinterest, and GoDaddy. Moreover, ELM and Naqvi falsely represented that they had access to these pre-IPO shares because of their relationships with leading venture capital firms, such as Kleiner Perkins Caufield & Byers, Benchmark Capital, and Silver Lake. In truth and in fact, ELM and Naqvi did not invest in the pre-IPO shares of these companies and did not have relationships with these venture capital firms.
ELM and Naqvi comingled the approximately $18 million that was invested in the Elm Tree Funds in a single investment account and then invested only a portion of the money, approximately $7.1 million. At no point did any of the Elm Tree Funds return a profit. Instead, for example, between January 2014 and November 2014, the Elm Tree Funds lost approximately $3.9 million in poor trading.
Moreover, of the investor funds that ELM and Naqvi did not lose in securities trading, ELM routinely converted investor funds to his own use in the form of cash withdrawals and to pay personal expenses, including to purchase a multimillion-dollar home, high-end furnishings, and other personal items, such as jewelry, daily living expenses, and luxury automobiles, including a Bentley, a Maserati, and a Range Rover.
The conversion of investors’ funds was contrary to the representations that ELM and Naqvi made to investors concerning their and ETIA’s fees. ELM and Naqvi falsely represented that they and ETIA would take a two percent annual management fee plus a performance fee of 20 percent of any profits that the Elm Tree Funds earned. In truth and in fact, ELM converted investor money that far exceeded the two percent management fee. Moreover, because the Elm Tree Funds never returned a profit, ELM, Naqvi, and ETIA were not entitled to any profit-based performance fees.
ELM and Naqvi also used approximately $5.2 million of new investor funds to make payments to earlier investors in a Ponzi-like fashion. To prevent or forestall redemptions, and continue to raise money to fund their scheme, ELM and Naqvi also generated fictitious account statements and made oral and written misrepresentations that their trading strategies were generating consistently positive returns.
ELM was initially arrested in April 2016 and released on bail. In June 2017, approximately one week before his then-scheduled guilty plea, ELM fled to Canada. ELM was subsequently arrested in Canada and extradited to the United States in January 2020. Naqvi, who had been a fugitive since his indictment in 2016, was arrested in Canada and extradited to the United States in November 2019.
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ELM, 51, was also sentenced to three years of supervised release, ordered to forfeit $8,318,840.07, and to pay restitution in the amount of $12,426,293.11.
Ms. Strauss praised the work of Homeland Security Investigations and the U.S. Department of Justice’s Office of International Affairs of the Department’s Criminal Division, and thanked the U.S. Securities and Exchange Commission for its assistance. Ms. Strauss also thanked Canadian law enforcement for its support and assistance.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorney Joshua A. Naftalis is in charge of the prosecution.