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Wednesday 23 September 2020
Human Resources Manager Charged with Defrauding Employer, Including Through COVID-19 Testing SchemeRead the Press Release
BOISE – Douglas Wold, 48, of Meridian, was indicted on September 10, 2020, by a federal grand jury sitting in Boise on eleven counts of wire fraud, one count of mail fraud, and one count of money laundering, announced U.S. Attorney Bart M. Davis.
According to court records, Wold worked as a Human Resources Manager for Fry Foods, Inc. in Ontario, Oregon. The indictment alleges that beginning in at least May 2020 and continuing through August 2020, Wold caused fraudulent payroll checks to be issued. Wold then deposited these fraudulent payroll checks into bank accounts in his control.
According to the indictment, Wold arranged for COVID-19 testing for Fry Foods’ employees at their Weiser, Idaho facilities in May 2020. Wold issued a fraudulent invoice to Fry Foods in the name of his business, Hala Lallo Health, for $39,995 when, in fact, the testing was provided by another entity and at a materially lower cost. When Fry Foods paid Hala Lallo Health for the testing, Wold deposited the funds into a bank account he controlled.
With respect to the money laundering count, the indictment alleges that Wold transferred $69,116.48 in proceeds from his frauds for the purchase a speedboat and trailer.
Each count of wire fraud and mail fraud carries a penalty of up to 20 years in prison, a maximum fine of $250,000, and up to three years of supervised release. Money laundering carries a penalty of up to ten years in prison, a maximum fine of $250,000, and up to three years of supervised release.
Wold was arraigned on September 14, where a trial was scheduled for November 2 before Chief U.S. District Judge David C. Nye at the federal courthouse in Boise.
This case was investigated by Internal Revenue Service – Criminal Investigation.
An indictment is a means of charging a person with criminal activity. It is not evidence. A person is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
For information about the Department of Justice’s efforts to stop illegal COVID-19-related activity, visit www.justice.gov/coronavirus. For the most up-to-date information on COVID-19, consumers may visit the Centers for Disease Control and Prevention (CDC) and WHO websites.
The public is urged to report suspected fraud schemes related to COVID-19 (the Coronavirus) to the National Center for Disaster Fraud (NCDF) hotline by phone at (1-866-720-5721) or via an online reporting form available at www.justice.gov/disaster-fraud/webform/ncdf-disaster-complaint-form
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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.
Great Falls man admits child pornography chargesRead the Press Release
GREAT FALLS – A Great Falls man accused of downloading and sharing child pornography with his cell phone admitted criminal charges today, U.S. Attorney Kurt Alme said.
Derek Wallace Johnson, 41, pleaded guilty to distribution of child pornography and to receipt of child pornography. Johnson faces a minimum mandatory five years to 20 years in prison, a $250,000 fine and five years to life of supervised release.
Chief U.S. District Judge Brian M. Morris presided. Sentencing is set for Jan. 21, 2021. Johnson was detained.
The prosecution said in court documents that in October 2019, Homeland Security Investigations in Great Falls received information that a suspect had uploaded possible child pornography in April 2019. An investigation determined that the uploaded image depicted a child engaged in sexually explicit conduct and led to Johnson as the suspect. Investigators served a search warrant on Johnson's residence. Johnson, who was present for the search, told officers he had lost his cell phone a few days earlier, but an agent found it hidden between the box spring and mattress in Johnson's bedroom.
After initially being untruthful, Johnson admitted he had participated in online activity involving child pornography and admitted to hiding his phone. He also said he had about 1,000 videos and images of child pornography in an encrypted app on his phone. Johnson told officers he downloaded child pornography in Kik chat rooms and shared files with others seeking images in chat rooms.
Agents searched Johnson's phone and determined it contained child pornography images. Johnson distributed child pornography in April 2019 and had downloaded or received child pornography from December 2016 to November 2019.
Assistant U.S. Attorney Cyndee Peterson is prosecuting the case, which was investigated by the Montana Internet Crimes Against Children Task Force, Homeland Security Investigations and the Great Falls Police Department.
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Gilead Agrees to Pay $97 Million to Resolve Allegations that it Paid Kickbacks through a Co-Pay FoundationRead the Press Release
BOSTON – Pharmaceutical company Gilead Sciences, Inc. (Gilead), based in Foster City, Calif., has agreed to pay $97 million to resolve claims that it violated the False Claims Act by illegally using a foundation, Caring Voice Coalition (CVC), as a conduit to pay the Medicare co-pays for its own drug, Letairis.
When a Medicare beneficiary obtains a prescription drug covered by Medicare Part D, the beneficiary may be required to make a partial payment, which may take the form of a co-payment, co-insurance, or deductible (collectively, co-pays). Congress included co-pay requirements in these programs, in part, to encourage market forces to serve as a check on health care costs, including the prices that pharmaceutical manufacturers can demand for their drugs. The Anti-Kickback Statute prohibits pharmaceutical companies from offering or paying, directly or indirectly, any remuneration – which includes money or any other thing of value – to induce Medicare patients to purchase the companies’ drugs.
As part of today’s settlement, the government alleged that Gilead used CVC, which claimed 501(c)(3) status for tax purposes, as a conduit to pay the co-pay obligations of thousands of Medicare patients taking Letairis, which is approved to treat pulmonary arterial hypertension (PAH). According to the government’s allegations, Gilead used CVC to cover the patients’ co-pays in order to induce those patients’ purchases of Letairis. Gilead knew that the prices it set for Letairis otherwise could have posed a barrier to those purchases.
The government specifically alleged that, from June 15, 2007, through Dec. 31, 2010, Gilead routinely obtained data from CVC detailing how many Letairis patients CVC had assisted, how much CVC had spent on those patients, and how much CVC expected to spend on those patients in the future. Gilead allegedly received this information through funding requests, telephone calls, and written reports. Gilead then used this information to budget for future payments to CVC to cover the co-pays of patients taking Letairis, but not of patients taking other manufacturers’ PAH drugs. The government alleged that Gilead engaged in this practice even though it knew it should not receive or use data concerning CVC’s expenditures on co-pays for Letairis. The government also alleged that, to generate revenue from Medicare, Gilead referred Medicare patients to CVC, which resulted in claims to Medicare to cover the cost of Letairis.
“Like its competitors, Actelion and United Therapeutics, Gilead used data from CVC that it knew it should not have, and effectively set up a proprietary fund within CVC to cover the co-pays of just its own drug,” said United States Attorney Andrew E. Lelling. “Such conduct not only violates the anti-kickback statute, it also undermines the Medicare program’s co-pay structure, which Congress created as a safeguard against inflated drug prices. During the period covered by today’s settlement, Gilead raised the price of Letairis by over seven times the rate of overall inflation in the United States.”
“This settlement, like prior settlements concerning similar misconduct, demonstrates the government’s commitment to hold accountable companies that pay illegal kickbacks, whether directly or through a third party,” said Acting Assistant Attorney General Jeffrey Bossert Clark of the Department of Justice’s Civil Division. “We will not permit pharmaceutical manufacturers to set unaffordable drug prices while circumventing important cost-control mechanisms within the Medicare program.”
“When pharmaceutical companies deceitfully employ the charitable donation process as an instrument to subsidize copays for their own drugs, it subverts a critical safeguard against the excessive inflation of drug costs,” said Phillip M. Coyne, Special Agent in Charge, Office of the Inspector General of the Department of Health and Human Service’s Boston Regional Office. “Manipulation of this process threatens the integrity of our federal healthcare system, disregarding the American taxpayer who ultimately bears the cost. As such, we remain vigilantly focused on confronting this type of conduct and will continue our aggressive enforcement in this area.”
“Health care fraud costs our country tens of billions of dollars each year because of unscrupulous schemes like the one Gilead orchestrated that dangled kickbacks disguised as copay assistance in front of Medicare patients,” said Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigations, Boston Division. “Today’s $97 million settlement ensures Gilead pays for defrauding a government insurance program and reaffirms the FBI’s resolve to pursue investigations and exhaust all efforts to uncover these schemes.”
To date, the Department of Justice has collected over $1 billion from eleven pharmaceutical companies (United Therapeutics, Pfizer, Actelion, Jazz, Lundbeck, Alexion, Astellas, Amgen, Sanofi, Novartis, and Gilead) that allegedly used third-party foundations as kickback vehicles. The Department also has reached settlements with four foundations (Patient Access Network Foundation, Chronic Disease Fund, The Assistance Fund, and Patient Services, Inc.) and a pharmacy (Advanced Care Scripts, Inc.) that allegedly conspired or coordinated with pharmaceutical companies on these kickback schemes.
U.S. Attorney Lelling, Acting Assistant Attorney General Clark, HHS-OIG SAC Coyne and Boston FBI SAC Bonavolonta made the announcement today. The matter was handled by Assistant U.S. Attorneys Gregg Shapiro and Abraham George of Lelling’s Affirmative Civil Enforcement Unit, and Trial Attorneys Sarah Arni and Augustine Ripa of the Department of Justice’s Civil Division.
Gilead Agrees to Pay $97 Million to Resolve Alleged False Claims Act Liability for Paying KickbacksRead the Press Release
Pharmaceutical company Gilead Sciences, Inc. (Gilead), based in Foster City, California, has agreed to pay $97 million to resolve claims that it violated the False Claims Act by illegally using a foundation as a conduit to pay the copays of thousands of Medicare patients taking Gilead’s pulmonary arterial hypertension drug, Letairis, the Justice Department announced today.
“This settlement demonstrates the government’s commitment to hold accountable companies that pay illegal kickbacks, whether directly or through a third party,” said Acting Assistant Attorney General Jeffrey Bossert Clark of the Department of Justice’s Civil Division. “We will not allow permit pharmaceutical manufacturers to set unaffordable drug prices while circumventing important cost-control mechanisms within the Medicare program.”
“Like its competitors, Actelion and United Therapeutics, Gilead used data from CVC that it knew it should not have, and effectively set up a proprietary fund within CVC to cover the co-pays of just its own drug,” said U.S. Attorney Andrew E. Lelling for the District of Massachusetts. “Such conduct not only violates the anti-kickback statute, it also undermines the Medicare program’s co-pay structure, which Congress created as a safeguard against inflated drug prices. During the period covered by today’s settlement, Gilead raised the price of Letairis by over seven times the rate of overall inflation in the United States.”
“When pharmaceutical companies deceitfully employ the charitable donation process as an instrument to subsidize copays for their own drugs, it subverts a critical safeguard against the excessive inflation of drug costs,” said Phillip M. Coyne, Special Agent in Charge, Office of the Inspector General of the Department of Health and Human Service’s Boston Regional Office. “Manipulation of this process threatens the integrity of our federal healthcare system, disregarding the American taxpayer who ultimately bears the cost. As such, we remain vigilantly focused on confronting this type of conduct and will continue our aggressive enforcement in this area.”
“Health care fraud costs our country tens of billions of dollars each year because of unscrupulous schemes like the one Gilead orchestrated that dangled kickbacks disguised as copay assistance in front of Medicare patients,” said Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigations, Boston Division. “Today’s $97 million settlement ensures Gilead pays for defrauding a government insurance program and reaffirms the FBI’s resolve to pursue investigations and exhaust all efforts to uncover these schemes.”
When a Medicare beneficiary obtains a prescription drug covered by Medicare, the beneficiary may be required to make a partial payment, which may take the form of a copayment, coinsurance, or a deductible (collectively “copays”). Congress included copay requirements in the Medicare program, in part, to serve as a check on health care costs, including the prices that pharmaceutical manufacturers can demand for their drugs.
Under the Anti-Kickback Statute, a pharmaceutical company is prohibited from offering or paying, directly or indirectly, any remuneration — which includes money or any other thing of value — to induce Medicare patients to purchase the company’s drugs. This prohibition extends to the payment of patients’ copay obligations.
Gilead sells Letairis, which is approved for treatment of pulmonary arterial hypertension. The government alleged that Gilead used a foundation, which claims 501(c)(3) status for tax purposes, as a conduit to pay the copay obligations of thousands of Medicare patients taking Letairis and to induce those patients to purchase Letairis, because it knew that the prices Gilead set for Letairis could otherwise pose a barrier to those purchases. From 2007 through 2010, Gilead made payments to the foundation, which, in turn, used those funds to pay copays of patients prescribed Letairis. The government alleged that Gilead routinely obtained data from the foundation detailing how much the foundation had spent for patients on Letairis; it then used this information to decide how much to pay to the foundation and to confirm that its payments were sufficient to cover the copays of only patients taking Letairis. The government also alleged that, to generate revenue from Medicare and induce purchases of Letairis, Gilead referred Medicare patients to the foundation, which resulted in claims to Medicare to cover the cost of Letairis.
The government’s resolution of this matter illustrates the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement, can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
The investigation was conducted by the Civil Division’s Commercial Litigation Branch and the U.S. Attorney’s Office for the District of Massachusetts, in conjunction with the Department of Health and Human Services, Office of Inspector General and the Federal Bureau of Investigation.
The claims resolved by the settlement are allegations only; there has been no determination of liability.
Gary Man Charged with Mail Fraud & Attempted Bank FraudRead the Press Release
HAMMOND – Da’Ione Fields, 23 of Gary, Indiana, was charged by way of an Indictment with two counts of mail fraud and one count of attempted bank fraud, announced U.S. Attorney Kirsch.
“Seniors are some of our more vulnerable citizens. Those in senior care facilities are dependent upon the care they receive there for their well-being,” said United States Attorney Thomas L. Kirsch II. “The alleged theft from a facility like this can have a severe negative impact on the residents in the facilities’ care. Theft results in diminished resources that should be available for the residents’ care and well-being. My Office is committed to protecting vulnerable seniors and working with our investigative agencies to investigate and prosecute those who steal from their employers.”
According to documents in the case, while working as a contract security guard for a senior living facility in Munster, Indiana, it is alleged that from October 18, 2019 to about December 3, 2019, Mr. Fields engaged in a scheme to defraud the facility of more than $280,000. The Indictment alleges that on two occasions Fields completed a USPS Change of Address form to redirect the facility’s mail to Fields’ residential address in Gary, Indiana. Between October 18 and November 22, 2019, Mr. Fields cashed approximately 31 insurance reimbursement and other checks payable to the facility totaling over $220,000. On November 21, 2019, Mr. Fields opened a corporate account at a bank in Gary, misrepresenting himself as an authorized representative of the facility and depositing 6 more checks totaling over $60,000.
The United States Attorney’s Office emphasizes that an Indictment is merely an allegation and that all persons are presumed innocent until, and unless proven guilty in court.
If convicted, any specific sentence to be imposed will be determined by the judge after a consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
This case is being investigated by United States Postal Inspection Service with the assistance of the Munster and Gary Police Departments. This case is being prosecuted by Assistant U.S. Attorneys Diane Berkowitz and Abizer Zanzi.
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Four Charged with Manufacturing Methamphetamine in Clinton and Essex CountiesRead the Press Release
PLATTSBURGH, NEW YORK – Bradley W. Price, age 44, of Ausable, New York, Leah M. Cross, age 30, of Ausable Forks, New York, Carl J. Estes, age 35, of Keeseville, New York and Andrew J. Barber, age 28, of Plattsburgh, have been indicted for conspiring to manufacture methamphetamine and possessing pseudoephedrine with the intent to manufacture methamphetamine.
The announcement was made by Acting United States Attorney Antoinette T. Bacon; Special Agent in Charge Ray Donovan, U.S. Drug Enforcement Administration (DEA), New York Division; and Clinton County District Attorney Andrew J. Wylie.
The indictment alleges that between July 8, 2020 and July 22, 2020, in Essex County, Price, Cross and Estes conspired to manufacture methamphetamine. It also alleges that on August 19, 2020, in Clinton County, Price, Cross and Barber conspired to manufacture methamphetamine. Each of the four is also charged with possessing and distributing pseudoephedrine knowing it would be used to manufacture methamphetamine.
The charges in the indictment are merely accusations. The defendants are presumed innocent unless and until proven guilty.
Price and Barber were arraigned on the indictment before United States Magistrate Judge Gary L. Favro on September 15, 2020, and were ordered detained pending trial. Cross and Estes were arraigned on the indictment before Judge Favro on September 22, 2020, and were also ordered detained pending trial.
If convicted of the charges, each defendant faces up to 20 years in prison, at least 3 years of post-imprisonment supervised release, and a maximum fine of $1 million. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines and other factors.
This case is being investigated by the DEA, with assistance from the Clinton County District Attorney’s Office, and is being prosecuted by Assistant U.S. Attorney Douglas Collyer.
Four Arrests Bring to Six the Number of McDonough County Defendants Charged with Trafficking Methamphetamine in West Central IllinoisRead the Press Release
ROCK ISLAND, Ill. – The arrest of four defendants last week brings the total to six charged to date in federal court as a result of an ongoing investigation of methamphetamine trafficking in West Central Illinois. Jerel J. Guarin, 42 of Colchester, Ill., and Shawn T. Connelly, 46; Trenton L. Sealock, 25; and, Amanda S. Edwards, 40, all of Bardolph, Ill., were arrested on Sept. 18, 2020, and made their initial appearances via video before U.S. Magistrate Judge Jonathan E. Hawley. Trial for the four is scheduled on Nov. 2, 2020, before U.S. District Judge Sara Darrow in Rock Island.
Connelly, Edwards, and Sealock have been ordered to remain detained in the custody of the U.S. Marshals Service. A detention hearing for Guarin is scheduled on Friday, Sept. 25.
Two additional defendants, Jeanna M. Rechkemmer, 33, of Bushnell, Ill., and Amber M. Phelps, 29, of Macomb, were previously indicted in March 2020. On Aug. 25, 2020, Phelps entered a plea of guilty to the charge and sentencing has been scheduled on Dec. 1, 2020. Rechkemmer is scheduled for an initial appearance on a superseding indictment and change of plea hearing on Sept. 25, 2020.
The indictments allege that the defendants participated in a conspiracy to distribute and possess with intent to distribute at least 50 grams of methamphetamine in West Central Illinois from January 2019 to February 2020.
The maximum statutory penalty for the offense is 10 years to life in prison.
The charges are the result of an ongoing investigation dubbed “Operation Icy Road,” by the Macomb / McDonough County Drug Unit. The McDonough County Sheriff’s Office, the Macomb Police Department, and the Galesburg Police Department conducted the investigations with the assistance of the West Central Illinois Drug Task Force, the Drug Enforcement Administration, and, the Federal Bureau of Investigation. Assistant U.S. Attorney Jennifer L. Mathew is prosecuting the cases on behalf of the U.S. Attorney’s Office for the Central District of Illinois, Rock Island Division, in cooperation with the McDonough County State’s Attorney’s Office.
Members of the public are reminded that an indictment is merely an accusation; each defendant is presumed innocent unless proven guilty.
Fort Thompson Man Sentenced for AssaultRead the Press Release
United States Attorney Ron Parsons announced that a Fort Thompson, South Dakota, man convicted of Assault Resulting in Substantial Bodily Injury to an Intimate Partner was sentenced on September 21, 2020, by Chief Judge Roberto A. Lange, U.S. District Court.
Charles Grey Owl, a/k/a Raymond Keith Grey Owl, age 49, was sentenced to 30 months in federal prison, 3 years of supervised release, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Grey Owl was indicted by a federal grand jury on December 10, 2019. He pled guilty on June 25, 2020.
The conviction stemmed from an incident on July 30, 2019, where Grey Owl unlawfully committed a domestic assault upon his intimate partner, who he has assaulted multiple times in the past. Because of the assault, the victim suffered substantial bodily injury and extreme pain to her lower leg.
This case was investigated by the Federal Bureau of Investigation. Assistant U.S. Attorney Troy R. Morley prosecuted the case.
Grey Owl was immediately turned over to the custody of the U.S. Marshals Service.
Fort Thompson Man Sentenced for AssaultRead the Press Release
United States Attorney Ron Parsons announced that a Fort Thompson, South Dakota, man convicted of Assault Resulting in Substantial Bodily Injury to an Intimate Partner was sentenced on September 21, 2020, by Chief Judge Roberto A. Lange, U.S. District Court.
Thomas Drapeau, Sr., age 32, was sentenced to all time served, 6 months and 10 days, 3 years of supervised release, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Drapeau was indicted by a federal grand jury on March 9, 2020. He pled guilty on June 29, 2020.
The conviction stemmed from an incident on November 14, 2019, when Drapeau assaulted his intimate partner repeatedly about the head and face, causing severe bruising, lacerations, and two of the victim’s teeth to be displaced.
This case was investigated by the Federal Bureau of Investigation. Assistant U.S. Attorney Troy R. Morley prosecuted the case.
Drapeau was immediately turned over to the custody of the U.S. Marshals Service.
Former Union President Sentenced for Violent ExtortionRead the Press Release
The former president of Iron Workers Local 395 was sentenced today to 42 months in prison for his role in organizing a brutal assault on a group of non-union ironworkers in Dyer, Indiana.
The attack, which left multiple workers with serious injuries, was part of an effort to obtain a contract for Local 395 to assist with the construction of the Plum Creek Christian Academy, a school affiliated with the Dyer Baptist Church.
Acting Assistant Attorney General Brian C. Rabbitt of the Department of Justice’s Criminal Division, Special Agent in Charge Irene Lindow, Chicago Regional Office, U.S. Department of Labor, Office of Inspector General (DOL-OIG) and Special Agent in Charge Paul Keenan of the FBI’s Indianapolis Field Office made the announcement.
Jeffrey Veach, 57, had earlier pleaded guilty to one count of extortion conspiracy, along with co-defendant Thomas Williamson Sr., 69. The sentence was handed down by U.S. District Court Judge Theresa Springmann of the Northern District of Indiana. Williamson is scheduled to be sentenced separately by Judge Springmann on Dec. 15.
Veach resigned as president of Local 395, following his guilty plea in January. Under federal law, Veach will be barred from holding any union position for at least 13 years following the end of his prison sentence.
Pursuant to his plea agreement, Veach admitted that in January 2016, he learned that D5 Iron Works – a non-union ironworking company from Illinois – was performing work for the Dyer Baptist Church, in Local 395’s “territory.” On the morning of Jan. 7, Veach and Williamson visited the construction site in order to persuade the D5 workers to sign up with the union or stop work on the site. When they were rebuffed, Veach brought rank-and-file members of Local 395 to the construction site later that day. At Veach’s direction, the union members conducted a coordinated attacked on the D5 workers. The victims were beaten with fists and loose pieces of hardwood. As a result of the attack, one of the workers sustained a broken jaw that required several surgeries and hospitalization.
The DOL-OIG, FBI, and Dyer Police Department investigated the case. Trial Attorneys Alexander Gottfried and Robert Tully of the Criminal Division’s Organized Crime and Gang Section prosecuted the case. The Organized Crime and Gang Section’s Labor Unit supports federal criminal prosecutions in cases involving labor-management relations, internal union affairs, and the operation of employee pension and health care plans. Assistant Chief for Labor-Management Racketeering Gerald Toner provided critical assistance in the prosecution of this case.
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.
Former Pittsburgh Man Sentenced to 15 Years in Prison for Attempted Coercion of a Minor for SexRead the Press Release
PITTSBURGH - A former resident of Pittsburgh, Pennsylvania, has been sentenced in federal court to 180 months’ imprisonment followed by 10 years’ supervised release on his conviction of Attempted Coercion and Enticement of a Minor to Engage in Illegal Sexual Activity, United States Attorney Scott W. Brady announced today.
United States District Judge Cathy Bissoon imposed the sentence on Joseph Hamilton, age 39.
According to information presented to the court, from March 11, 2019 until on or about April 18, 2019, Hamilton communicated online and via text messaging with an undercover FBI agent, believing the agent to be a minor, to knowingly attempt to persuade, induce, entice and coerce the purported minor to engage in sexual activity with him. Law enforcement arrested Hamilton on April 18, 2019, when Hamilton attempted to meet the purported minor for the purpose of engaging in sexual activity.
Assistant United States Attorney Heidi M. Grogan prosecuted this case on behalf of the government.
United States Attorney Brady commended the Federal Bureau of Investigation for the investigation leading to the successful prosecution of Hamilton.
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.justice.gov/psc.
Former Owner of La Cremaillere Restaurant Sentenced to Federal Prison for FraudRead the Press Release
Audrey Strauss, the Acting United States Attorney for the Southern District of New York, announced that BARBARA MEYZEN, a/k/a "Bobbie Meyzen," the former owner and operator of La Cremaillere Restaurant in Banksville, New York, was sentenced in White Plains federal court to two years in prison for fraud in connection with her multi-year scheme to defraud the restaurant’s lenders, mortgagee, bankruptcy creditors and customers and to obstruct the bankruptcy process. MEYZEN had previously pleaded guilty to one count of wire fraud and was sentenced today by U.S. District Judge Vincent L. Briccetti.
According to the allegations in the Superseding Information to which MEYZEN pleaded guilty and other court documents:
MEYZEN owned and operated the La Cremaillere Restaurant in Banksville, New York from 1993 to August 2020. From August 2015 to July 2016, MEYZEN submitted applications for credit on behalf of La Cremaillere to at least nine lenders, factors and financiers. In support of those applications, MEYZEN gave the potential lenders La Cremaillere's bank statements that she had modified to change negative balances to positive balances; to remove references to checks returned for insufficient funds; and to reduce service fees. For example, MEYZEN modified one month's statement to change a negative beginning balance of $32,865.57 to a positive beginning balance of $27,766.29; to change from negative to positive the negative ending balance for that month of $5,268.13; and to change service charges of $2,385.60 to $8.00. When one lender discovered that MEYZEN had altered the bank statements, MEYZEN created an email account in the name of one of the bank's officers and sent the lender an email in which she, in the guise of the bank officer, told the lender that the statements were genuine.
MEYZEN also falsely represented to the same lender that the second mortgage on the restaurant's property in Banksville had been discharged. She created a false satisfaction of mortgage on which she forged the signature of a representative of the restaurant's second mortgagee, who is MEYZEN'S relative by marriage. MEYZEN filed the false satisfaction of mortgage with the Westchester County Clerk, paid the Clerk's filing fee, and sent a copy of the filed satisfaction of mortgage to the lender. MEYZEN later denied filing the false satisfaction of mortgage or paying the filing fee when she was interviewed by Special Agents of the FBI. She told the FBI that she believed a loan broker with whom she had worked in the past, and whom she identified by name, had filed the false satisfaction of mortgage.
Throughout the summer of 2017, MEYZEN charged more than $148,979 in restaurant and personal expenses to credit card accounts of two of the restaurant's customers. When one of the customers discovered the charges, MEYZEN claimed the charges were a mistake and repeatedly promised to resolve the problem. MEYZEN gave the customer two checks in a total amount of $32,000 but the checks bounced. When she was interviewed by the FBI, MEYZEN denied knowing anything about unauthorized charges to the customer's credit card or ever speaking with the customer about the unauthorized charges. MEYZEN also denied giving the customer checks.
Meyzen filed bankruptcy petitions for Meyzen Family Realty Associates, LLC, which owned the real property from which the restaurant operated, in the U.S. Bankruptcy Court in White Plains in September 2018. She filed a bankruptcy petition for La Cremaillere Restaurant Corp., which operated the restaurant, in April 2019. In May 2019, MEYZEN misled the office of the United States Trustee, which oversees bankruptcy cases, about insurance coverage on the restaurant property. MEYZEN caused her bankruptcy counsel to give the United States Trustee and an attorney for Meyzen Family Realty's largest creditor documents indicating that the property was insured when, in fact, she knew that the insurance coverage had been canceled months earlier for nonpayment. In June 2019, MEYZEN falsely testified under oath in a deposition conducted by the United States Trustee that she was not aware that the insurance had been canceled when she caused her attorney to turn the documents over to the United States Trustee.
Two days after La Cremaillere filed for bankruptcy in April 2019, MEYZEN opened a bank account in her name and diverted more than $40,000 of the restaurant's credit card receipts to that account. MEYZEN used a portion of that money to make payments to a food distributor and to an in-home nursing service. This account was closed on May 1, 2019. On May 7, 2019, MEYZEN opened an account in the name of Honey Bee Farm, LLC at another bank and diverted La Cremaillere's credit card receipts, as well as $20,000 in advances on La Cremaillere's future credit card revenue, to that account. MEYZEN used a portion of that money to pay restaurant and personal expenses.
In addition to the prison term, Judge Briccetti ordered MEYZEN, 57, of Redding, Connecticut, to serve two years of supervised release, and to pay forfeiture and restitution each in the amount of $320,289.35.
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Ms. Strauss praised the outstanding investigative work of Special Agents of the FBI and the Criminal Investigators of the Office of Internal Affairs, New York State Department of Taxation and Finance.
The prosecution of this case is being handled by the Office’s White Plains Division. Assistant United States Attorney James McMahon is in charge of the prosecution.
Former Federal Grand Juror Pleads Guilty to Obstruction of JusticeRead the Press Release
Columbia, South Carolina --- United States Attorney Peter M. McCoy, Jr., announced today that Alicia Renee Coleman, 51, of Rock Hill, pleaded guilty in federal court to obstruction of justice.
Evidence presented to the court showed that in early June 2018, Coleman communicated secret federal grand jury information concerning an indictment and upcoming arrests in United States v. Hemphill, et al. Coleman learned the information in her capacity while serving as a federal grand juror and communicated the information to a family member in violation of a court order. Law enforcement quickly learned of the leak, which had made its way to targets of the investigation, and as a result changed the date of the upcoming takedown in the case. Coleman was relieved of her duties as a federal grand juror and after initially denying that she shared grand juror information outside the grand jury, admitted the same to federal agents.
The charge against Coleman was the result of an investigation by the Federal Bureau of Investigation (FBI). Assistant United States Attorney Stacey D. Haynes of the Columbia office is prosecuting the case.
Coleman faces a maximum penalty of 10 years in federal prison, a fine of $250,000, and three years federal supervised release. United States District Judge Mary Geiger Lewis accepted the guilty plea and will sentence her after receiving and reviewing a sentencing report prepared by the United States Probation Office.
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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.
Former Co-Owner of New Jersey Marketing Company Admits Role in $8.8 Million Compounded Prescription Drug SchemeRead the Press Release
NEWARK, N.J. – The former co-owner of a New Jersey marketing company today admitted her role in a scheme to defraud public and private health benefits programs of at least $8.8 million for the billing of medically unnecessary compounded prescriptions, U.S. Attorney Craig Carpenito announced.
Lisa Curty, 43, of Staten Island, New York, pleaded guilty by videoconference before U.S. District Judge John Michael Vazquez to an information charging her with conspiracy to commit health care fraud.
According to documents filed in this case and statements made in court:
Compounded medications are specialty medications mixed by a pharmacist to meet the specific medical needs of an individual patient. Although compounded drugs are not approved by the Food and Drug Administration (FDA), they are properly prescribed when a physician determines that an FDA-approved medication does not meet the health needs of a particular patient, such as if a patient is allergic to a dye or other ingredients in the prescription.
Between February 2015 and February 2017, Curty participated in a conspiracy that involved the submission of fraudulent prescriptions for compounded medications to public and private insurance plans. The scheme centered on the discovery that certain insurance plans paid for prescription compounded medications – including scar creams, wound creams, and metabolic supplements/vitamins – at exorbitant reimbursement rates.
Curty exploited this opportunity by creating a New Jersey marketing company (Marketing Company-1) and hiring sales representatives to target individuals who had insurance plans that covered compounded medications. The sales representatives then convinced those individuals to obtain prescriptions for compounded medications, regardless of medical necessity, often by providing them with cash payments. The individuals were then directed to certain telemedicine companies, which Marketing Company-1 or its affiliates paid, to receive the prescriptions.
Once the prescriptions were written, they were filled by certain compounding pharmacies with which Marketing Company-1 conspired. The compounding pharmacies would then receive reimbursement from the insurance plans, and would pay Marketing Company-1 a percentage of the reimbursement amount. As one of the owners of Marketing Company-1, Curty retained a portion of the payment and provided a “commission” payment to the relevant sales representative.
Curty’s conspirator and co-owner of Marketing Company-1, Christine Myers, pleaded guilty on July 27, 2020, to conspiracy to commit health care fraud and is scheduled to be sentenced on Dec. 1, 2020.
Two sales representatives that worked for Marketing Company-1, Christopher Frusci and Enver Kalaba, were former Metropolitan Transportation Authority (MTA) employees. Since the MTA’s health insurance plan covered compounded medications, Frusci and Kalaba targeted co-workers at the MTA and paid them cash bribes for every compounded prescription they submitted. Frusci and Kalaba have both previously pleaded guilty to conspiracy to commit health care fraud charges based on their respective roles in the scheme. On Feb. 7, 2019, Kalaba was sentenced in Newark federal court to 20 months in prison and one year of supervised release, and must forfeit $138,630 in criminal proceeds he received for his role in the scheme and pay restitution of $2.9 million. Frusci is awaiting sentencing.
The count of conspiracy to commit health care fraud is punishable by a maximum of 10 years in prison and a fine of $250,000 fine, or twice the gross gain or loss from the offense. As part of her plea agreement, Curty must forfeit $1.475 million in criminal proceeds she received for her role in the scheme and pay restitution of at least $8.8 million. Sentencing is scheduled for Jan. 26, 2021.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr.; the U.S. Department of Defense, Defense Criminal Investigative Service, under the direction of Special Agent in Charge Leigh-Alistair Barzey; and the Office of the Inspector General, Metropolitan Transportation Authority, under the direction of Inspector General Carolyn Pokorny, with the ongoing investigation leading to today’s guilty plea.
The government is represented by Assistant U.S. Attorney Adam Baker of the U.S. Attorney’s Office, Opioid Abuse Prevention and Enforcement Unit in Newark.
Former CEO Sentenced for Embezzling $7.9 Million Intended for Injured ChildrenRead the Press Release
ALEXANDRIA, Va. – A Round Hill man was sentenced today to 70 months in prison for his scheme to embezzle $7,957,750 from the United States government and a private hospital that was intended to settle claims by victims of medical malpractice, many of whom were children.
According to court documents, Joseph E. Gargan, 60, was the Chief Executive Officer of the Pension Company, Inc., an Arlington business that would execute settlement agreements entered into between civil litigants. Specifically, the Pension Company was hired to transfer money from civil defendants to plaintiffs and to purchase annuities on behalf of minor plaintiffs.
The United States government entered into settlement agreements with plaintiffs in six separate matters. Many of these cases involved children who either claimed to be injured as a result of medical malpractice or who suffered the loss of a parent through alleged medical negligence that occurred at a hospital or clinic operated or insured by the federal government. The settlement agreements required the United States to pay the plaintiff a sum of money and to purchase an annuity on behalf of the injured child. From December 2015 to August 2019, the United States transferred a total of $15,925,000 to the Pension Company to purchase the annuities and execute the six settlement agreements. Gargan embezzled $6,925,000 of this money.
In addition, Gargan embezzled money from a hospital located in New York that was part of a civil settlement with a minor child. The settlement called for $3,825,000 to be paid by the hospital to a trust to pay for the care and ongoing medical treatment of the child. The settlement agreement also provided that a portion of the $3,825,000 be paid to a structured settlement broker who would then purchase an annuity which would generate future income for the trust. The Pension Company was retained as the structured settlement broker. From October 2018 to March 2020, the hospital paid the Pension Company a total of $1,032,750 to fund the purchase of an annuity on behalf of the trust. Gargan embezzled all $1,032,750.
In some cases, Gargan attempted to conceal his criminal activity by creating false documents purporting to show that he had purchased the annuities when, in fact, he had embezzled and converted that money to his own use. Gargan also made payments to the plaintiffs falsely claiming the payments were proceeds from an annuity, when, in fact, the payments were made only to conceal his criminal conduct.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Robert E. Bornstein, Acting Special Agent in Charge of the FBI Washington Field Office Criminal Division, made the announcement after sentencing by U.S. District Judge Rossie D. Alston, Jr. Assistant U.S. Attorney William Fitzpatrick prosecuted the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:20-cr-110.
Felon Pleads Guilty to Possessing Stolen GunRead the Press Release
Memphis, TN – Erik Macklin, 24, has pleaded guilty to possessing a stolen gun. D. Michael Dunavant, U.S. Attorney announced the guilty plea today.
According to information presented in court, on November 1, 2019, members of the Germantown Police Department were conducting surveillance on Macklin, a suspect in multiple aggravated burglaries in Germantown, Tennessee. Macklin also had an outstanding arrest warrant.
Officers located Macklin at a local business. As they approached and asked him to step outside, Macklin pulled away from the officers and grabbed a firearm from his waistband. Law enforcement was able to restrainMacklin, which caused him to drop the firearm, and he was taken into custody.
The firearm was a.45 caliber pistol that had been reported stolen from West Memphis, Arkansas, several weeks prior. Macklin waived his Miranda rights and admitted to possessing the firearm.
As a result of his prior felony convictions, including aggravated burglary, felony theft, and felony vandalism, Macklin is prohibited by federal law from possession of firearms or ammunition.
On September 23, 2020, Macklin entered a guilty plea to being a felon in possession of a firearm. Sentencing is scheduled for December 16, 2020, before U.S. District Court Judge John T. Fowlkes Jr., where he faces up to 10 years in federal prison followed by three years supervised release. There is no parole in the federal system.
U.S. Attorney D. Michael Dunavant said, "A stolen firearm in the hands of a convicted felon threatens everyone, including law enforcement. There is a good reason that federal law prohibits and punishes such illegal gun possession, and this conviction resulting in prison with no parole will help to reduce gun crime in Memphis."
The Germantown Police Department and Project Safe Neighborhoods Task Force investigated this case. The Project Safe Neighborhoods (PSN) initiative is a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. In 2017, PSN was reinvigorated as part of the Justice Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local and tribal law enforcement and the local community to develop effective, locally based strategies to reduce violent crime. Project Guardian is a new DOJ initiative designed to reduce gun violence and enforce federal firearms laws across the country by focusing on investigating, prosecuting, and preventing gun crimes.
Special Assistant U.S. Attorney Samuel D. Winnig is prosecuting this case on behalf of the government. SAUSA Winnig is currently assigned from the Shelby County District Attorney General’s Office for prosecuting violent crimes and firearms offenses in federal court.
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Four Fond Du Lac Men Indicted for Firearm Straw Buying Conspiracy and Possession of FirearmsRead the Press Release
Matthew D. Krueger, U.S. Attorney for the Eastern District of Wisconsin, announced that on September 22, 2020, Jonathan Griffin (age: 28); Jason Spinks (age: 37); Shakie Davis (age: 25); and Treon Dennis (age: 36) of Fond du Lac, were indicted with conspiracy to make a false statement to a licensed firearms dealer and possession of firearms by felons, in violation of Title 18, United States Code, Sections 371, 922(g)(1) & 924(a)(2).
The U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF”) identified that Fond du Lac area felons Griffin, Spinks, Davis, and Dennis sold heroin in the area and used their heroin distribution network to recruit one of their heroin customers to purchase eleven firearms for them over an eight-month period. Three of the eleven firearms were recovered at crime scenes in the Chicago area shortly after they were purchased.
If convicted of the conspiracy to make a false statement to a licensed firearms dealer and possession of firearms by felons, Griffin, Spinks, Davis and Dennis would face a maximum of 10 years in prison and a fine of up to $250,000.
“As alleged in the indictment, these men engaged in dangerous activities connected to firearms and heroin,” said U.S. Attorney Krueger. “I commend the excellent work of the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives. The Justice Department is committed to working with state and local authorities to ensure public safety and violent crime reduction in all of our cities.”
“Working closely with our local and state law enforcement partners, we are able to use our resources effectively and collaboratively to investigate straw purchasing in communities such as Fond du Lac,” remarked ATF Special Agent in Charge Kristen deTineo of the Chicago Field Division. “Lying and buying is illegal, and we will follow each investigative lead to ensure firearms do not end up in the hands of those who are prohibited from possessing them.”
Fond du Lac Police Chief William B. Lamb remarked, “Investigations into criminal conspiracy networks suspected to be involved in the illegal possession and trafficking of dangerous drugs and firearms have been amongst the greatest of priorities for the City of Fond du Lac Police Department. The gun violence that is associated with the drug trade is an epidemic that is ripping far too many cities in our nation apart and we are committed to preventing that type of criminal activity in our city. I commend the work done by the Officers and Investigators of the City of Fond du Lac Police Department as well as those involved members of the Lake Winnebago Area MEG – Drug Unit, Fond du Lac County Sheriff’s Office, and US Bureau of Alcohol, Tobacco, Firearms and Explosives, for their exceptional investigative efforts in this and other similar investigations.”
This case was investigated by the ATF and the Fond du Lac Police Department. This case will be prosecuted by Assistant United States Attorney Christopher Ladwig.
A criminal indictment is merely a formal method of charging an individual and does not constitute inference of his or her guilt. An individual is presumed innocent until such time, if ever, that the government establishes his or her guilt beyond a reasonable doubt. A criminal indictment is merely a formal method of charging an individual and does not constitute inference of his or her guilt. An individual is presumed innocent until such time, if ever, that the government establishes his or her guilt beyond a reasonable doubt.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
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Public Information Officer Kenneth Gales
(414) 297-1700
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Ellisburg Man Sentenced on Federal Child Pornography ChargesRead the Press Release
SYRACUSE, NEW YORK – Anildar Valdimir Roblero-Gomez, age 26, a citizen of Mexico who had been living in Ellisburg, New York, was sentenced today to serve 96 months in prison for uploading to Facebook a video depicting minors engaged in sexually explicit conduct.
The announcement was made by Acting United States Attorney Antoinette T. Bacon, New York State Police Superintendent Keith Corlett, and Kevin Kelly, Special Agent in Charge of the Buffalo Field Office of Homeland Security Investigations (HSI).
Chief United States District Court Judge Glenn T. Suddaby also ordered Roblero-Gomez to serve a 15-year term of supervised release, which will begin after he is released from prison. As a result of his conviction, Roblero-Gomez will be required to register as a sex offender following his prison sentence. He may also face immigration consequences as the result of his conviction and sentence.[1]
In his previous plea of guilty, Roblero-Gomez admitted that in September 2018, he used a cellular telephone to upload a video depicting child pornography to the Facebook social media platform, sharing the video with over 100 other Facebook users.
This case was investigated by the New York State Police and the Department of Homeland Security, Homeland Security Investigations (HSI), and was prosecuted by Assistant United States Attorney Sahar L. Amandolare.
This case is prosecuted as part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the United States Attorney’s Offices, 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 identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
[1] Deportation, removal, and other matters related to the defendant’s legal status in the United States are civil matters adjudicated in separate proceedings in Immigration Court.
Drug Trafficker Sentenced to 10 Years for Moving Kilograms of Drugs Through the Lehigh ValleyRead the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Miguel Gonzalez Segovia, 31, of Veracruz, Mexico, was sentenced to ten years in prison, five years of supervised release by United States District Court Judge Joseph F. Leeson Jr. for trafficking drugs in the Lehigh Valley in November 2018.
In September 2019, Gonzalez Segovia pleaded guilty to the charge of possession with intent to distribute 69 kilograms cocaine, 14 kilograms of fentanyl, and 4 kilograms of acetyl fentanyl (a fentanyl analogue). According to court documents, the defendant was stopped by a Pennsylvania State Trooper while driving on Interstate 78 in Northampton County, and was evasive in answering questions and provided conflicting information about his destination and purpose for traveling through Northeastern Pennsylvania. The Trooper also observed nine large suitcases stacked inside the rented vehicle the defendant was driving.
After searching the vehicle and one of the suitcases to reveal approximately 50 pounds of substances including cocaine, fentanyl and acetyl fentanyl, Gonzalez Segovia was placed under arrest and interviewed by Pennsylvania State Police. He admitted that this was the fourth time he had driven the same drug delivery route across Pennsylvania for individuals in California, and explained that they would load drugs between furniture in moving trucks in California and drive it to the East Coast for delivery in different locations in New York, New Jersey, Pennsylvania and Maryland.
“Gonzalez Segovia and other members of this drug organization moved huge quantities of dangerous drugs through and into our community,” said First Assistant U.S. Attorney Williams. “These traffickers essentially delivered destruction to every state, city and town where these deadly drugs ultimately landed. Our office is determined to investigate and convict these criminals, and put them behind bars.”
“Segovia pleaded guilty and was responsible for trafficking 69 kilograms of cocaine and 18 kilograms of illicit fentanyl across the Lehigh Valley area. These are substantial amounts of dangerous and potentially deadly illicit drugs,” said Jonathan A. Wilson, Special Agent in Charge of the Drug Enforcement Administration’s (DEA) Philadelphia Field Division. “Working with our partners at the Pennsylvania State Police, Segovia will no longer be able to distribute these poisons that ruin our communities and destroy countless lives.”
The case was investigated by the Drug Enforcement Administration, Allentown Resident Office and the Pennyslvania State Police. The case is being prosecuted by Assistant United States Attorney Kelly A. Lewis Fallenstein.
Department of Justice Begins Second Distribution of Funds Recovered Through Asset Forfeiture to Compensate Victims of Western Union Fraud Scheme, Bringing Total to over $300 MillionRead the Press Release
The Department of Justice announced today that the Western Union Remission Fund began its second distribution of approximately $148 million in funds forfeited to the U.S. government from the Western Union Company (Western Union) to approximately 33,000 victims located in the United States and abroad. These victims, many of whom were elderly victims of consumer fraud and abuse, will be recovering the full amount of their losses.
This is the second in a series of payment distributions to occur in the Western Union remission. The first distribution paid approximately $153 million to over 109,000 victims in March of this year. The Department of Justice anticipates authorizing compensation for many more victims in the coming months. The department is accepting petitions on an ongoing basis and will be providing potential victims who have not applied for remission the opportunity to apply.
“Through the tireless work of the Department of Justice, today 33,000 more individuals, including many elderly victims of the criminals who exploited Western Union’s deficient anti-money laundering controls, are being made whole through this distribution of an additional $148 million,” said Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division. “Together with the first distribution, the department has now remitted more than $300 million to over 142,000 victims of this fraud. These results reinforce the department’s commitment to compensating victims whenever possible.”
“After the first distribution of funds to victims of these nefarious scammers, I said that it was a good start,” said U.S. Attorney David J. Freed. “Today’s announcement marks another important event in this lengthy and complicated case. While ensuring fair business practices and anti-fraud programs is certainly a worthy goal, our aim is always to compensate our victims. We credit the innovative and industrious efforts of our investigative partners and thank them for their sustained efforts to make the victims whole.”
“We are very pleased to deliver $148 million to provide financial justice for these thousands of victims,” said Damon E Wood, Inspector in Charge of the U.S. Postal Inspection Service’s (USPIS) Philadelphia Division. “This brings the total returned to victims to over $300 million. Especially in these difficult times, the monies will hopefully provide relief for those who were scammed. The Postal Inspection Service will continue to be at the forefront of protecting Americans from the scams that harm our most vulnerable citizens and delivering justice for all.”
In 2017, Western Union entered into a deferred prosecution agreement (DPA) with the United States. Pursuant to the DPA, Western Union acknowledged responsibility for its criminal conduct, which included violations of the Bank Secrecy Act and aiding and abetting wire fraud, and agreed to forfeit $586 million, which has been made available to compensate victims of the international consumer fraud scheme through the remission process. Western Union simultaneously resolved a parallel civil investigation with the Federal Trade Commission.
In this scheme, fraudsters targeted consumers, including seniors, through multiple scams. Three specific scams directed towards seniors include the grandparent scam, where the fraudster would pose as the victim’s relative in need of immediate money to avoid personal harm, lottery or sweepstakes scams, where the fraudster would tell the victim that they had won a large cash prize but had to pay fees such as taxes to claim the prize, and romance scams, where the fraudster would pose as an online love interest and request funds for a visit or for another purpose. In each of these scams the fraudsters convinced their victims to send money through Western Union.
Certain owners, operators or employees of Western Union agent locations were complicit in the schemes. Western Union aided and abetted the fraud scheme by failing to suspend or terminate complicit agents and by allowing them to continue to process fraud-induced monetary transactions. Western Union fulfilled its obligations under the DPA and the court granted the motion to dismiss the information this year.
The Justice Department, through the Asset Forfeiture Program, works diligently to restore lost funds to victims of crime and acknowledges the significant assistance of the USPIS Philadelphia Division’s Harrisburg, Pennsylvania Office in the Western Union remission. The victim compensation payments in the Western Union case would not have been possible without the extraordinary efforts of the Criminal Division’s Money Laundering and Asset Recovery Section; the U.S. Attorneys’ Offices for the Middle District of Pennsylvania, the Central District of California, the Eastern District of Pennsylvania, and the Southern District of Florida. The FBI’s Los Angeles Field Office, IRS-Criminal Investigation, U.S. Immigrations and Customs Enforcement’s Homeland Security Investigations, the Federal Reserve Board and the Consumer Financial Protection Bureau Office of Inspector General, and the Department of the Treasury Office of Inspector General provided valuable assistance.
More information about the Western Union remission and its compensation to victims is available on the Western Union remission website at www.westernunionremission.com. Further questions may be directed to the Western Union Remission Administrator by phone at 844-319-2124 or by email at [email protected].
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.
Department of Justice Begins Second Distribution of Funds Recovered Through Asset Forfeiture to Compensate Victims of Western Union Fraud Scheme, Bringing Total to over $300 MillionRead the Press Release
WASHINGTON – The Department of Justice announced today that the Western Union Remission Fund began its second distribution of approximately $148 million in funds forfeited to the U.S. government from the Western Union Company (Western Union) to approximately 33,000 victims located in the United States and abroad. These victims, many of whom were elderly victims of consumer fraud and abuse, will be recovering the full amount of their losses.
This is the second in a series of payment distributions to occur in the Western Union remission. The first distribution paid approximately $153 million to over 109,000 victims in March of this year. The Department of Justice anticipates authorizing compensation for many more victims in the coming months. The department is accepting petitions on an ongoing basis and will be providing potential victims who have not applied for remission the opportunity to apply.
“Through the tireless work of the Department of Justice, today 33,000 more individuals, including many elderly victims of the criminals who exploited Western Union’s deficient anti-money laundering controls, are being made whole through this distribution of an additional $148 million,” said Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division. “Together with the first distribution, the department has now remitted more than $300 million to over 142,000 victims of this fraud. These results reinforce the department’s commitment to compensating victims whenever possible.”
“After the first distribution of funds to victims of these nefarious scammers, I said that it was a good start,” said U.S. Attorney David J. Freed. “Today’s announcement marks another important event in this lengthy and complicated case. While ensuring fair business practices and anti-fraud programs is certainly a worthy goal, our aim is always to compensate our victims. We credit the innovative and industrious efforts of our investigative partners and thank them for their sustained efforts to make the victims whole.”
“We are very pleased to deliver $148 million to provide financial justice for these thousands of victims,” said Damon E Wood, Inspector in Charge of the U.S. Postal Inspection Service’s (USPIS) Philadelphia Division. “This brings the total returned to victims to over $300 million. Especially in these difficult times, the monies will hopefully provide relief for those who were scammed. The Postal Inspection Service will continue to be at the forefront of protecting Americans from the scams that harm our most vulnerable citizens and delivering justice for all.”
In 2017, Western Union entered into a deferred prosecution agreement (DPA) with the United States. Pursuant to the DPA, Western Union acknowledged responsibility for its criminal conduct, which included violations of the Bank Secrecy Act and aiding and abetting wire fraud, and agreed to forfeit $586 million, which has been made available to compensate victims of the international consumer fraud scheme through the remission process. Western Union simultaneously resolved a parallel civil investigation with the Federal Trade Commission.
In this scheme, fraudsters targeted consumers, including seniors, through multiple scams. Three specific scams directed towards seniors include the grandparent scam, where the fraudster would pose as the victim’s relative in need of immediate money to avoid personal harm, lottery or sweepstakes scams, where the fraudster would tell the victim that they had won a large cash prize but had to pay fees such as taxes to claim the prize, and romance scams, where the fraudster would pose as an online love interest and request funds for a visit or for another purpose. In each of these scams the fraudsters convinced their victims to send money through Western Union.
Certain owners, operators or employees of Western Union agent locations were complicit in the schemes. Western Union aided and abetted the fraud scheme by failing to suspend or terminate complicit agents and by allowing them to continue to process fraud-induced monetary transactions. Western Union fulfilled its obligations under the DPA and the court granted the motion to dismiss the information this year.
The Justice Department, through the Asset Forfeiture Program, works diligently to restore lost funds to victims of crime and acknowledges the significant assistance of the USPIS Philadelphia Division’s Harrisburg, Pennsylvania Office in the Western Union remission. The victim compensation payments in the Western Union case would not have been possible without the extraordinary efforts of the Criminal Division’s Money Laundering and Asset Recovery Section; the U.S. Attorneys’ Offices for the Middle District of Pennsylvania, the Central District of California, the Eastern District of Pennsylvania, and the Southern District of Florida. The FBI’s Los Angeles Field Office, IRS-Criminal Investigation, U.S. Immigrations and Customs Enforcement’s Homeland Security Investigations, the Federal Reserve Board and the Consumer Financial Protection Bureau Office of Inspector General, and the Department of the Treasury Office of Inspector General provided valuable assistance.
More information about the Western Union remission and its compensation to victims is available on the Western Union remission website at www.westernunionremission.com. Further questions may be directed to the Western Union Remission Administrator by phone at 844-319-2124 or by email at [email protected].
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Corfu Woman Employed as Mail Carrier Charged with Acting as A Money Mule for Internet Scammers, Sending Thousands of Dollars to AfricaRead 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 Julie Keller, 55, of Corfu, NY, was arrested and charged by criminal complaint with mail fraud. The charge carries a maximum penalty of 20 years in prison, a $250,000 fine, or both.
Assistant U.S. Attorney Jonathan P. Cantil, who is handling the case, stated that according to the complaint, between 2014 and August 2020, the defendant engaged as a money mule for various internet based scams, accepting and re-directing thousands of dollars to Africa. During that time, she had accounts closed by at least five different national and local banks due to suspicious cash, check, money order, and wire activity.On July 17, 2020, the United States Postal Inspection Service (USPIS) received a request for assistance from the Boston, Massachusetts Police Department. A detective was investigating a report of an individual (C.R.P.), who believed she had been defrauded in relation to a rental property listed on the online classified site, Craigslist. In June, 2020, C.R.P. replied to an advertisement for an available apartment for rent and, ultimately agreed to rent a property listed on their local Craigslist site. All communication between the supposed landlord and C.R.P. was completed via text message. The supposed landlord instructed C.R.P. to split the deposit for the rental between an electronic payment via an electronic cellular telephone application, or “cash app,” and by money order, using the U.S. Mail. The supposed landlord instructed C.R.P. to send the money order to Julie Keller in Corfu, New York, who was identified as an accountant. The investigation determined that the address provided by the supposed landlord is a United States Postal Service (USPS) Facility in Corfu and Keller is employed by the USPS as a mail carrier.
After C.R.P. made the down payments as instructed, the person listing the property ceased all contact, and the property was never secured or occupied by C.R.P. C.R.P. provided a number of screen shots from her cellular telephone, depicting her text communications with the individual who had listed the rental property. Subsequent investigation determined that other individuals sent the defendant down payments for the rental property listed on Craigslist.
A cursory look into Julie Keller's banking history revealed that she had a pattern of suspicious cash, check, money order and wire activity totaling in excess of $150,000.00 dating back to 2014. Records indicated Keller had been either deceptive or unresponsive when questioned by bank personnel about the nature of her transactions. Her activities included the use of national and local banks, as well as Western Union and MoneyGram.
Keller made an initial appearance before U.S. Magistrate Judge H. Kenneth Schroeder, Jr. and was released on conditions.
The criminal complaint 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 fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.# # # #
Convicted Felon Charged with Illegal Firearms PossessionRead the Press Release
BIRMINGHAM, Ala. – A federal grand jury today indicted a Talladega man for being a felon in possession of a firearm, announced U.S. Attorney Prim F. Escalona and Bureau of Alcohol, Tobacco, Firearms and Explosives Acting Special Agent in Charge Toby Taylor.
A one-count indictment filed in U.S. District Court charges Larry Dewayne Gaither, 43, with being a felon in possession of a firearm.
According to the indictment, Gaither is prohibited from having a firearm because of prior felony convictions and is accused of unlawfully possessing an American Tactical .223 and 103 rounds of Wolf Performance .223 caliber ammunition in January 2020.
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. The United States Attorney’s Office has prosecuted this case with support from the following Project Guardian partners: Bureau of Alcohol, Tobacco, Explosives and Firearms. For more information about Project Guardian, please see: https://www.justice.gov/projectguardian.
The maximum penalty for being a felon in possession of a firearm is 10 years in prison and a $250,000 fine.
ATF investigated the case. Assistant U.S. Attorney Kristy Peoples is prosecuting.
An indictment contains only charges. A defendant is presumed innocent unless and until proven guilty.
Co-owner of Cincinnati Findlay Market butcher shop sentenced to prison for food stamp fraudRead the Press Release
DAYTON – A husband and wife and their Findlay Market vendor, Busch’s Country Corner, Inc., were all sentenced in U.S. District Court today for food stamp fraud.
Michael D. Busch was sentenced to 12 months in prison and ordered to pay a $50,000 fine. His wife, Amanda Jo Busch, was sentenced to five years of probation with eight months in home confinement, and 200 hours of community service.
Both of the Busches and the corporation were also ordered to pay $87,192 in restitution.
The Busches were convicted by a jury in Dayton following a two-week trial in June 2019.
According to court documents and trial testimony, from April 2010 until May 2018, Busch’s Country Corner co-owner Michael Busch, his wife, Amanda Jo Busch, and his brother, Randall S. Busch, illegally exchanged cash for SNAP benefits.
The defendants caused more than 195,000 individual SNAP Electronic Benefit Transfer (EBT) transactions to be completed by Busch’s Country Corner, totaling more than $5.4 million. According to witness testimony at trial, approximately 64 percent, or $3.4 million, of those SNAP transactions were fraudulent.
Co-conspirators used an electronic point of sale device in order to process EBT transactions for cash. For example, one transaction included a beginning EBT balance of $1,300 and an ending balance of $11.
Michael, Amanda Busch and Busch’s Country Corner were each convicted on all counts, including conspiracy to steal government funds, SNAP fraud and wire fraud.
Randall Busch, the brother of Michael Busch, previously pleaded guilty and was sentenced to five years of probation.
Congress sets the maximum statutory sentence. Sentencing of the defendant is determined by the Court based on the advisory sentencing guidelines and other statutory factors.
David M. DeVillers, United States Attorney for the Southern District of Ohio; Anthony V. Mohatt, Special Agent in Charge, U.S. Department of Agriculture Office of Inspector General Investigations, Midwest Region; Yvonne DiCristoforo, Special Agent in Charge, U.S. Secret Service; and Michelle Thourot, Agent-in-Charge, Ohio Investigative Unit, announced the sentence imposed by Senior U.S. District Court Judge Thomas M. Rose. Assistant United States Attorney Dwight Keller and Assistant Deputy Criminal Chief Laura Clemmens represented the United States in this case.
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Clark Man Charged with Receipt and Distribution of Child PornographyRead the Press Release
United States Attorney Ron Parsons announced that a Clark, South Dakota, man has been indicted by a federal grand jury for Receipt and Distribution of Child Pornography.
Anthony Dialo Holmes, age 36, was indicted on August 17, 2020. He appeared before U.S. Magistrate Judge William D. Gerdes on September 18, 2020, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 20 years in federal prison and/or a $250,000 fine, life of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on between September 1, 2019, and May 22, 2020, Holmes knowingly received and distributed and attempted to receive and distribute, any child pornography that had been mailed, shipped, and transported in or affecting interstate or foreign commerce by any means, including by computer.
The charge is merely an accusation and Holmes is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Department of Homeland Security, Division of Criminal Investigation, Office of the Attorney General, Watertown Police Department, and the Clark Police Department. Assistant U.S. Attorney Jeffrey C. Clapper is prosecuting the case.
Holmes was released on bond pending trial. A trial date has not been set.
Chicago Man Charged in Federal Court with CyberstalkingRead the Press Release
CHICAGO — A Chicago man was arrested today on a federal criminal charge for allegedly cyberstalking and harassing a former romantic partner.
A criminal complaint filed in U.S. District Court in Chicago charges VINCENT STORME, 32, with cyberstalking. Storme made an initial court appearance this afternoon before U.S. Magistrate Judge Sunil R. Harjani and was ordered to remain in federal custody. Judge Harjani scheduled a detention hearing for Friday at 1:30 p.m.
The charge was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago Field Office of the FBI. Valuable assistance was provided by the Chicago Police Department and Cook County State’s Attorney’s Office. The government is represented by Assistant U.S. Attorney Shoba Pillay.
According to the complaint, Storme began a campaign of threats and harassment against the victim after she ended their relationship. Storme accessed the victim’s social media accounts without her knowledge to obtain private messages and data, including nude photographs of the victim, which he then disseminated to her family, friends, and co-workers, the complaint states. Storme also created a website and social media accounts bearing the victim’s name, and used them to further embarrass and harass the victim, the complaint states.
Cyberstalking is punishable by up to five years in federal prison. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.
The public is reminded that a complaint is not evidence of guilt. The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Cass County Woman Sentenced for Federal Drug Trafficking ViolationsRead the Press Release
MARSHALL, Texas – A 34-year-old Avinger, Texas, woman has been sentenced for federal drug trafficking crimes in the Eastern District of Texas, announced U.S. Attorney Stephen J. Cox today.
Ashley Christine McDaniel pleaded guilty on June 16, 2020, to possession with intent to distribute methamphetamine and was sentenced to 120 months in federal prison today by U.S. District Judge Rodney Gilstrap.
According to information presented in court, on March 28, 2018, McDaniel delivered approximately 26 grams of methamphetamine during a controlled purchase in Morris County, Texas, for $500 cash. In all, McDaniel delivered a total of approximately 59 grams of methamphetamine for which she received $1,170. McDaniel was indicted by a federal grand jury on Oct. 16, 2019 and charged with federal drug trafficking crimes.
This case was investigated by the Texas Department of Public Safety and the Morris County Sheriff’s Office and prosecuted by Assistant U.S. Attorney Jim Noble.
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Bucks County Man Indicted for Trafficking Firearms to St. LuciaRead the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced that Thomas Harris Jr., 27, of Croydon, PA was arrested and charged by Indictment with multiple firearms trafficking offenses stemming from his scheme to sell almost 40 guns to a buyer on the island of St. Lucia. Specifically, the defendant was charged with making false statements to a federal firearm licensee, dealing in firearms without a license, delivery of firearms to a common carrier without written notice, and smuggling goods from the United States.
The Indictment alleges that Harris purchased approximately 38 firearms in 12 transactions at two Bucks County, PA, gun shops between April 20, 2019, and February 15, 2020, and provided a false address as his place of residence on the required federal forms that he completed during each transaction. It is further alleged that the defendant then illegally trafficked, and attempted to traffic, the guns to St. Lucia, a sovereign island nation in the West Indies, despite his not having a license to deal in firearms nor a license to export them as required by law. He also allegedly failed to notify the shipping company he used that his shipments contained firearms, as required by law.
One of Harris’s suspected packages to St. Lucia was intercepted by federal agents at the warehouse of a local shipping company. Inside, concealed in household items such as packages of diapers, cat litter and laundry detergent, the agents found seven Glock semiautomatic pistols, one Ruger semiautomatic pistol, two AK-47 pattern pistols, two AK-47 pattern rifles, two AR-15 lower receivers, two AR-15 upper receivers, ten high capacity Glock ammunition magazines, seven additional assorted ammunition magazines, and 815 rounds of ammunition.
Harris allegedly used the alias “Lance Brown” when he presented this package to the shipping company for shipment to St. Lucia, and he allegedly falsely told a shipping company representative that the package contained household items. After the defendant left this package with the shippers, he traveled to St. Lucia himself in March 2020. He remained there until returning to the United States on July 25, 2020, when he was arrested at an airport in New York.
“As alleged in the Indictment charging him with firearms trafficking offenses, Harris has a brazen disrespect for our laws meant to regulate and monitor the sale of weapons,” said First Assistant U.S. Attorney Williams. “After sending his most recent shipment of guns overseas he also left the country for a few months, but all that did was postpone the inevitable. If you are charged in the Eastern District of Pennsylvania with a federal offense, there is no place to hide, here or abroad. We will not rest until we find you and hold you accountable.”
“Illicit international firearms trafficking is a top priority for the Office of Export Enforcement,” said P. Lee Smith, Performing the Non-exclusive Functions and Duties of the Assistant Secretary for Export Enforcement at the Department of Commerce. “We will continue to work with our law enforcement partners to arrest and prosecute individuals who violate United States export control laws that are intended to keep the most dangerous goods out of the most dangerous hands.”
“Preventing the illegal use and trafficking of firearms is a central focus of ATF's strategy to combat violent crime and protect our communities,” said John Schmidt, acting Special Agent in Charge of ATF’s Philadelphia Field Division. “Illegally purchased firearms often end up in the hands of violent offenders and affect communities near and far, in this instance Saint Lucia in the Caribbean. Ensuring firearms traffickers are aggressively investigated and swiftly brought to justice is a top priority for the Philadelphia Field Division -- this collaborative effort between our local, state and federal partners is a prime example of such.”
“If you want to be a firearms dealer and exporter, get the proper licenses and follow the law,” said Michael J. Driscoll, Special Agent in Charge of the FBI's Philadelphia Division. "Guns illegally exported overseas are quite likely to end up in the wrong hands and be used to commit further criminal acts. The FBI is committed to working with our law enforcement partners to combat weapons trafficking, in the interests of public safety here and abroad.”
If convicted, the defendant faces a maximum possible sentence of 80 years in prison, three years of supervised release, a $3,750,000 fine, and a $1,500 special assessment.
The case was investigated by the U.S. Department of Commerce, Office of Export Enforcement, New York Field Office; the Bureau of Alcohol, Tobacco, Firearms, and Explosives; and the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Joseph A. LaBar and U.S. Department of Justice National Security Division Trial Attorney Michael E. Eaton.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Boston Woman Pleads Guilty to Role in Multimillion-Dollar Marijuana EnterpriseRead the Press Release
BOSTON – A Boston woman pleaded guilty today to her role in a marijuana delivery service that operated in Massachusetts from 2015 to 2018.
Tatiana Fridkes, a/k/a Sonya, 34, of Dorchester, pleaded guilty to one count of conspiring to distribute more than 100 kilograms of marijuana. U.S. District Court Judge Timothy S. Hillman scheduled sentencing for Feb. 1, 2021.
Fridkes and Deana Martin, 52, of Milton, were indicted in May 2019 in connection with their management of Northern Herb, a marijuana delivery service that operated in Massachusetts from 2015 to 2018. Martin was also charged with one count of possessing more than 100 kilograms of marijuana and three counts of money laundering, and has pleaded not guilty.
According to court documents, Fridkes served as the office manager for Northern Herb. Fridkes coordinated with Martin on finances, marijuana suppliers, marijuana inventory, deliveries, workers and warehouse operations. Fridkes managed Northern Herb employees when Martin was not present, collected and organized cash from marijuana sales and paid cash wages to Northern Herb employees.
From May 2016 through July 2018, Northern Herb had total revenue exceeding $14 million. Northern Herb did not withhold or pay taxes on its millions of dollars in marijuana sales, did not remit or pay employment taxes in connection with its workforce and did not pay taxes on its profits. Northern Herb was not licensed by Massachusetts or any other governmental entity to sell or distribute marijuana. While Northern Herb purported to provide medical marijuana, it did not require a customer to provide proof of a medical marijuana card and would deliver marijuana to unattended locations (such as a front door or hallway) where unknown third parties might have access to it.
Fridkes faces a sentence of five to 40 years in prison, a minimum of four years and up to a lifetime of supervised release and a fine of up to $5 million. Sentences are imposed by a federal district court judge based on the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling; Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration, New England Division; and Joleen Simpson, Acting Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston made the announcement today. The United States Postal Inspection Service also provided valuable assistance with this investigation. Assistant U.S. Attorney Bill Abely of Lelling’s Criminal Division is prosecuting the case.
The details contained in the indictment and complaint are allegations. The remaining defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Billings man sentenced to prison for trafficking meth in Missoula, Great FallsRead the Press Release
GREAT FALLS — A Billings man who admitted distributing methamphetamine in Missoula and Great Falls was sentenced today to 10 years in prison and five years of supervised release, U.S. Attorney Kurt Alme said.
William Walton Hanson Jr., 41, also known as "JR," pleaded guilty in June to possession with intent to distribute meth.
Chief U.S. District Judge Brian M. Morris presided.
In court documents filed in the case, the prosecution said that in December 2018, a Missoula County Sheriff's Office detective received information that Hanson was traveling to Missoula from Washington with drugs. The detective was aware that Hanson was known to be involved in meth distribution and that Hanson had an active arrest warrant. Missoula police conducted a traffic stop and arrested Hanson on the warrant. Officers obtained a search warrant for the vehicle and found approximately 125 grams of meth. Through the investigation, officers learned that Hanson was involved in trafficking meth in Missoula and Great Falls from about December 2018 to February 2019.
Assistant U.S. Attorney Cassady Adams prosecuted the case, which was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, FBI, Drug Enforcement Administration, Missoula County Sheriff's Office, Missoula Police Department and Great Falls Police Department.
This case is part of Project Safe Neighborhoods, a U.S. Department of Justice initiative to reduce violent crime. According to the FBI’s Uniform Crime Reports, violent crime in Montana increased by 36% from 2013 to 2018. Through PSN, federal, tribal, state and local law enforcement partners in Montana focus on violent crime driven by methamphetamine trafficking, armed robbers, firearms offenses and violent offenders with outstanding warrants.
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Big Sandy couple sentenced to prison for trafficking meth on Rocky Boy's Indian ReservationRead the Press Release
GREAT FALLS — A Big Sandy couple who admitted distributing methamphetamine on the Rocky Boy's Indian Reservation today were sentenced to prison terms, U.S. Attorney Kurt Alme said.
Clayton Gary Bailey, 48, was sentenced to 57 months in prison and five years of supervised release. Bailey's wife, Brigitte Ann Bailey, 44, was sentenced to 44 months in prison and five years of supervised release. Each pleaded guilty in June to possession with intent to distribute meth.
Chief U.S. District Judge Brian M. Morris presided.
The prosecution said in court documents that on Sept. 12, 2019, officers with Chippewa Cree Law Enforcement made a traffic stop on the Rocky Boy's Indian Reservation of a vehicle driven by Clayton Bailey, who was wanted on a tribal court warrant. Officers also knew that Clayton Bailey had been identified by sources as a supplier of illegal drugs. Brigitte Bailey was a passenger. Clayton Bailey was arrested on the warrant and Brigitte Bailey was transported off the reservation. Officers impounded and searched the vehicle. Law enforcement found a glass jar and two plastic baggies that contained a total of about 66 grams of meth. On the driver-side floor, officers found a machete, a small hatchet, a knife and a small taser.
Clayton Bailey admitted to officers that he owned the meth and a small amount of heroin also found in the vehicle and that he had been selling drugs in the area for multiple months. Brigitte Bailey admitted to being involved in trafficking meth. She disputed the amount of meth found in the vehicle but agreed she had intended to distribute it.
Assistant U.S. Attorney Ethan Plaut prosecuted the case, which was investigated by the FBI, Chippewa Cree Law Enforcement and Tri-Agency Drug Task Force.
This case is part of Project Safe Neighborhoods, a U.S. Department of Justice initiative to reduce violent crime. According to the FBI’s Uniform Crime Reports, violent crime in Montana increased by 36% from 2013 to 2018. Through PSN, federal, tribal, state and local law enforcement partners in Montana focus on violent crime driven by methamphetamine trafficking, armed robbers, firearms offenses and violent offenders with outstanding warrants.
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Alleged Maryland Drug Dealer Facing Federal Indictment for the 2015 Murder of A Woman and Her Seven-Year-Old Child, Among Other ChargesRead the Press Release
Baltimore, Maryland – A federal grand jury today returned a superseding indictment charging Andre Ricardo Briscoe, a/k/a Poo, age 37, of Baltimore and Cambridge, Maryland, with federal drug distribution charges, use of a firearm to commit murder in relation to the drug trafficking crimes, killing a witness to prevent communication with law enforcement, and being a felon in possession of a firearm and ammunition.
The superseding indictment was announced by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge Timothy Jones of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Baltimore Field Division; Special Agent in Charge Jennifer C. Boone of the Federal Bureau of Investigation, Baltimore Field Office; Commissioner Michael Harrison of the Baltimore Police Department; and Acting Chief Mark K. Lewis of the Cambridge Police Department.
U.S. Attorney Robert K. Hur stated, “These murders are shocking and unconscionable. This indictment should make one thing crystal clear: If you touch a witness, especially a child, the full weight of federal law enforcement will be harnessed to find you and bring you to justice. And we will not stop investigating until we bring to justice anyone else who was involved.”
“Jennifer Jeffrey and her child should still be here today, living full lives and making plans for that child’s bright future. Instead, their lives and futures were brutally stolen,” said ATF Baltimore Special Agent in Charge Timothy Jones. “ATF and our partners will do everything in our power to bring murderers and violent offenders to justice, along with anyone who harms and intimidates witnesses. We want to see families find peace, communities become safer, and citizens and witnesses live without fear.”
“A seven-year-old child should be playing with friends and dreaming about the future, not dying in a heinous act of violence,” said Jennifer C. Boone, Special Agent in Charge of the FBI Baltimore Field Office. “Violence and intimidation of witnesses will not be tolerated. Let this indictment send a clear message; if anyone attempts to tamper with the justice system, they will be caught and held accountable.”
According to the superseding indictment, from March through October 2015, Briscoe conspired with others to distribute heroin. The indictment alleges that on May 27, 2015, in connection with his drug distribution, Briscoe committed an armed robbery and during the course of the robbery shot and killed Jennifer Jeffrey and Jeffrey’s seven-year-old child. The indictment also alleges that Briscoe shot the child multiple times, including in the head and mouth, killing the child to prevent him/her from communicating with law enforcement.
If convicted of the murders, Briscoe faces a maximum sentence of death or life in prison. Briscoe also faces death or a mandatory sentence of life in prison if convicted of the witness tampering murder; a mandatory minimum of five years and a maximum of 20 years in federal prison for the conspiracy to distribute and for possession with the intent to distribute 100 grams or more of heroin; and a maximum of 10 years in prison for being a felon in possession of a firearm and ammunition. Actual sentences for federal crimes are typically less than the maximum penalties. Briscoe remains in federal custody on his previous indictment and is expected to have an initial appearance on the new charges in U.S. District Court in Baltimore in the near future.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Robert K. Hur commended the ATF, the FBI, the Baltimore Police Department, and the Cambridge Police Department for their work in the investigation. Mr. Hur thanked Assistant U.S. Attorneys Dana J. Brusca, Sandra Wilkinson, and Michael C. Hanlon, who are prosecuting the case.
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46 indicted for involvement in Marion drug trafficking organization; 43 arrested during early morning takedownRead the Press Release
Federal, county and local law enforcement officials today announced that 46 individuals were charged for their roles in a drug trafficking conspiracy that involved the distribution of heroin, cocaine, crack cocaine and fentanyl in the Marion area. 43 were arrested during an early morning takedown. The operation is ongoing.
First Assistant U.S. Attorney Bridget Brennan, FBI Special Agent in Charge Eric B. Smith, Marion Police Chief William Collins and Marion County Sheriff Tim Bailey made the announcement.
“Organizations like the one dismantled here today target communities like Marion because they mistakenly assume that they can operate either without detection or without people speaking up,” said First Assistant U.S. Attorney Bridget Brennan. “Let these indictments serve as notice that law enforcement partners in this District and the residents of Marion are paying attention. And we will act.”
“Possession and distribution of illegal narcotics and the illegal possession of firearms will not be tolerated in our communities or by the good citizens who live there,” said FBI Special Agent in Charge Eric B. Smith. “Likewise, the FBI will continue it’s targeted, exhaustive, and collaborative efforts with our local, state and federal partners to identify and dismantle drug trafficking organizations that bring poison and violence into our neighborhoods.”
“These arrests are the result of dedicated work of multiple agencies with one shared goal -- to keep this community safe and free from dangerous drugs,” said DEA Detroit Field Division Special Agent in Charge Keith Martin.
“Our unending commitment to this community is to work relentlessly in collaboration with our law enforcement partners at every level, bringing every combined resource to bear with the unified mission to deliver those persons to justice who contribute to this deadly scourge,” said Marion Police Chief William Collins. “I'm immensely proud of the collective achievements born from this 2-year investigation, while I also remain dedicated to ensuring that this important work continues well into the future.”
The following is a breakdown of the charges:
Charged in a 29-count indictment with conspiracy to possess with the intent to distribute and distribution of controlled substances, distribution of a controlled substance, possession with the intent to distribute a controlled substance and use of a communications facility to facilitate a drug trafficking offense are:
Raheem Brown, age 28, of Marion; Eric Carter, age 57, of Marion; Tawana Cochran, age 37, in state custody; Harold Cowans, age 81, of Columbus; Brittany Crabtree, age 29, of Marion; Rex Cumston, age 58, of Marion; Jeff Ellinwood, age 38, of Marion; Andy Fernandez, age 39, of Ypsilanti, Michigan; Paula Foreman, age 58, of Marion; Juan Demetrius Hartwell, age 46, of Marion; Mitchem Hopper, age 30, in state custody; Marty Keifer, age 29, of Marion; Ricky Kensler, in federal custody; Jamal Mincey, age 32, of Marion; Andre Pearson, age 40, of Marion; Terry Phillips, age 61, of Marion; Lawrence Redrick, age 43, in federal custody; Clifton Ross, age 45, of Columbus; Toni Sparks, age 29, of Marion; Terell Steen, age 43, in state custody; William Swartz, Jr, age 61, of Marion; Billie Jean White, age 32, of Marion; Taylor Williams, age 27, of Marion.
Charged in a 22-count indictment with conspiracy to distribute and possess with intent to distribute controlled substances, distribution of a controlled substance, possession with the intent to distribute a controlled substance, felon in possession of a firearm and use of a communications facility in furtherance of a drug trafficking offense are:
Robert Baker, age 38, of Marion; Corey Cesar, age 28, of Marion; Tawana Cochran, age 37, in state custody; Kenneth Crumpton, age 31, of Farmington Hills, Michigan; Kenneth Drake, age 40, of Marion; Rodney Tyson Hall, age 37, of Larue, Ohio; Warren Harris, age 40, of Marion; Josten Jones, age 29, of Marion; Ronald Jordan, age 33, in state custody; Courtney Miles, age 35, in state custody; Lindsay Pacha, age 26, of Marion; Clifton Ross, age 45, of Columbus and Terry Worthington, age 41 in state custody.
Charged in a 16-count indictment with conspiracy to distribute and possess with intent to distribute controlled substances, distribution of controlled substance and use of a communications facility in furtherance of a drug trafficking offense are:
Kendall Bender, age 33; Michael Collins, age 41; Meghan Landon, age 34; Destiny Pyles, age 23; Timothy Reed, age 36 and Alisha Taylor, age 24, all of Marion.
Charged in six separate indictments with possession with intent to distribute a controlled substance distribution of a controlled substance are:
Otis Oliver, age 32; Darrius Kevin Karl Young-Owens, age 26; Anthony Robinson, age 32; all of Marion; James Glass, age 36; Curtis Thomas, age 33 and Johnny Thomas, age 34, both in state custody.
According to the indictments, from October 2015 to January 2019, these 46 individuals are accused of operating a drug trafficking organization that distributed large quantities of cocaine, crack cocaine, heroin and fentanyl throughout the Marion area via suppliers in Ohio, Michigan, Illinois and elsewhere. The conspirators are accused of using multiple cellular devices and code words to conceal their activity. In some instances, the indictments states that members of the drug trafficking organization used firearms in the conduct of their drug trafficking activity.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
If convicted, each defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal records, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
The investigation preceding the indictments was conducted by the Cleveland Division of the FBI, DEA, Organized Crime Drug Enforcement Taskforce (OCDETF), Marion Police and Marion County Sheriff’s Office. This case is being investigated by Assistant U.S. Attorneys Matthew Simko and Robert Melching.
Tuesday 22 September 2020
Whitman Man Sentenced for Child Pornography OffensesRead the Press Release
BOSTON – A Whitman man was sentenced today in federal court in Boston for child pornography offenses.
Matthew Kulikowski, 38, was sentenced by U.S. District Court Judge Richard G. Stearns to 151 months in prison and five years of supervised release. In January 2020, Kulikowski pleaded guilty to one count of receipt of child pornography and one count of possession of child pornography. Kulikowski was arrested and charged in September 2018, and has been in custody since that time.
Law enforcement learned that an internet user at Kulikowski’s Whitman home distributed child pornography using the Kik messenger application. A search of the home resulted in the seizure of a tablet located in Kulikowski’s bedroom that contained at least 300 images and videos depicting child pornography, including the sexual assault of girls who appeared to be between four-and-eight-years-old.
At the time of his arrest, Kulikowski was on pretrial release from Plymouth County Superior Court, where he had a case pending for multiple child exploitation offenses, including possession of child pornography, disseminating obscene material to a minor, indecent assault and battery on a child under 14, and enticement of a child under 16. He has since been convicted of those offenses.
United States Attorney Andrew E. Lelling and Michael Shea, Acting Special Agent in Charge of Homeland Security Investigations in Boston made the announcement. Assistance was provided by the Massachusetts State Police, Whitman Police Department and the Plymouth County District Attorney’s Office. Assistant U.S. Attorney Anne Paruti, Lelling’s Project Safe Childhood Coordinator and a member of the Major Crimes Unit, prosecuted the case.
The case is brought as part of Project Safe Childhood. In 2006, the Department of Justice created Project Safe Childhood, a nationwide initiative designed to protect children from exploitation and abuse. Led by the U.S. Attorneys’ Offices and the DOJ’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to locate, apprehend, and prosecute individuals who exploit children, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov/.
United States Obtains Court Order Requiring City of Mount Vernon to Address Polluting Storm SewersRead the Press Release
Audrey Strauss, the Acting United States Attorney for the Southern District of New York, and Peter D. Lopez, Regional Administrator of the U.S. Environmental Protection Agency (“EPA”), announced today that the federal District Court has ordered the City of Mount Vernon, New York (“Mount Vernon”), to bring its polluting storm sewer system into compliance with the Clean Water Act. U.S. District Judge Cathy Seibel issued the order and permanent injunction yesterday, in a lawsuit brought by the United States and New York State.
Acting U.S. Attorney Audrey Strauss said: “Mount Vernon’s longstanding failure to comply with its Clean Water Act obligations, including flouting EPA administrative orders, will now be remedied through judicial relief. This lawsuit was brought to protect the waters of this District, and the Court’s detailed and comprehensive order requires Mount Vernon to fix its ongoing violations, including the discharge of raw sewage and other illicit pollutants from its storm sewer system into the Hutchinson and Bronx Rivers.”
EPA Regional Administrator Peter D. Lopez said: “I am pleased that the City of Mount Vernon is being required to take the appropriate actions to protect its residents and downstream communities from threats posed by raw sewage and other pollutants. EPA and New York State have worked with Mount Vernon over the past several years and we look forward to seeing the problems with the storm sewer system resolved to protect public health and the environment.”
The Clean Water Act generally prohibits discharges of pollutants into navigable waters, absent a permit. Many municipalities, like Mount Vernon, operate “municipal separate storm sewer systems” that carry storm water and discharge it without treatment into nearby waters. Because separate storm sewer systems do not treat the water they discharge, a municipality is required by its Clean Water Act permit to maintain a program for identifying and eliminating any sewage or other illicit pollutants that are flowing into the storm sewers. On June 28, 2018, the United States filed a complaint in White Plains federal court, alleging that since at least January 2012, Mount Vernon has failed to comply with these permit obligations and, as a result, has allowed raw sewage to flow into its storm sewer system, and then to be discharged into the Hutchinson and Bronx Rivers. Mount Vernon has also failed to comply with two EPA Administrative Orders issued to compel Mount Vernon’s compliance with these requirements.
Before the Court, Mount Vernon did not dispute that it was liable for violating the Clean Water Act, and admitted that it was not in compliance with its legal obligations. The Court concluded that the undisputed facts regarding Mount Vernon’s non-compliance with the Clean Water Act were likely to cause irreparable injury and warranted the issuance of a permanent injunction to require Mount Vernon to come into full compliance and halt illicit discharges into the Hutchinson and Bronx Rivers. The Court ordered Mount Vernon to:
- Track down and identify all sources of illicit discharge for impaired storm sewer system outfalls, and eliminate all sources of illicit discharge;
- Perform necessary construction and repairs for impaired outfalls;
- Complete inspections to ensure detection of future illicit discharge;
- Obtain the necessary equipment, staffing, and funding to comply with its Clean Water Act and permit obligations;
- Develop an updated storm water management plan;
- Perform a sewer system evaluation survey of the sanitary sewer system to identify possible discharges of sewage and develop a sewer system corrective action plan; and
- Submit periodic reports to EPA and New York’s Department of Environmental Conservation.
The Court deferred a determination of civil penalties owed by Mount Vernon until a later date.
The State of New York and the Commissioner of the New York State Department of Environmental Conservation are co-plaintiffs in this lawsuit, asserting parallel claims under state law.
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Ms. Strauss thanked EPA’s attorneys and program staff for their invaluable efforts in this matter.
This case is being handled by the Office’s Environmental Protection Unit. Assistant United States Attorney Natasha W. Teleanu and former Assistant U.S. Attorney Emily E. Bretz have been in charge of the case.
United States Attorney's Office Debuts Circles and SilenceRead the Press Release
PROVIDENCE – United States Attorney Aaron L. Weisman today announced that the United Attorney’s Office will debut its Circles and Silence community outreach program on September 24, during a virtual opioid addiction and prevention town hall Zoom meeting for residents of the Blackstone Valley hosted by the Woonsocket Prevention Coalition.
On Thursday, September 24, the Woonsocket Prevention Coalition will be joined by Dr. James McDonald, Medical Director of the Rhode Island Department of Health, Major Dennis Leahey (Ret.), Program Manager, RI State Police HOPE Initiative, and United States Attorney’s Office Community Engagement & Crime Prevention Coordinator David Neill. The program, beginning at 6:30pm on Zoom, will discuss the opioid epidemic and its effect on individuals, families and our communities and host the premiere screening of the Circles and Silence.
The public is encouraged to join the Zoom Town Hall Meeting by clicking https://us02web.zoom.us/j/85449845545?pwd=MXdiR2pQMkVGNjV2eTB0ckVUVkpTZz09 or use Zoom meeting ID 854 4984 5545, Passcode 337318.
Circles and Silence, a powerful, locally produced sixteen minute documentary film is narrated by a diverse group of Rhode Island young adults whose personal true-life stories delve deeply into their distinct journeys of drug dependency and recovery. The film documents their paths from addiction, in some instances to prison, to successful management of addiction, to working daily to lead productive and healthy lifestyles.
“Recognizing and coping with substance abuse disorder, whether personally or by assisting a family member or friend who is struggling, is even more urgent during these difficult times in which we have witnessed a significant increase in substance abuse,” commented United States Attorney Aaron L. Weisman. “The individuals we meet in Circles and Silence bravely share their challenges and their successes as they work hard to remain on a positive path forward.”
In addition to sharing their stories in this remarkable documentary, individuals who appear in the film will participate in live talk-backs with audiences. Additionally, the United States Attorney’s Office makes available to audiences critical information about substance abuse disorder and the many prevention, recovery, and social service programs available statewide through an expansive network.
The documentary film Circles and Silence was produced collaboratively by the United States Attorney’s Office and two Rhode Island-based production companies, Left of Creative, with offices in South Kingstown and Los Angeles, CA, and DK Communications in Providence.
Video clips from Circles and Silence can be viewed at https://www.justice.gov/usao-ri/circles-and-silence .
The United States Attorney's Community Outreach Office is available to provide a Circles and Silence program to all Rhode Island schools and students grades 7-12, and to community and not-for-profit organizations at no cost. To learn more about the Circles and Silence Program or to schedule a presentation contact United States Attorney’s Office Community Engagement & Crime Prevention Coordinator David Neill at (401) 709-5035 or at [email protected]
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U.S. Attorney J. Douglas Overbey Announces $749,718 in Department of Justice Grant Award to WillowBend Farms, Inc.Read the Press Release
KNOXVILLE, Tenn. – United States Attorney J. Douglas Overbey of the Eastern District of Tennessee announced today that $749,718 was awarded to WillowBend Farms, Inc. of Cleveland, Tennessee, in Department of Justice grant funding to combat human trafficking.
The Services for Victims of Human Trafficking Program awards more than $23.6 million to 43 organizations to support services specific to victims of human trafficking. The Office for Victims of Crime awarded over $97.4 million to state, local and tribal jurisdictions, service providers and task forces all over the country, while OJP’s National Institute of Justice awarded the remaining $3.5 million to support research and evaluation on human trafficking.
"Human trafficking takes the depravity of everyone involved and exploits minors and adults for profit. Millions of people worldwide are affected by this type of forced labor and human trafficking. Our office will remain persistent by bringing perpetrators to justice and assisting victims rescued from a cycle of abuse," said U.S. Attorney Overbey.
WillowBend Farms is a faith based non-profit organization who focuses on the restoration of minor and adult survivors of human trafficking. WillowBend Farms also develops a collaborative environment of change that addresses the entire supply and demand of human trafficking.
If you suspect human trafficking report it to the police immediately. Warning signs include when the person: Appears to be controlled or intimidated by someone else, stops talking to friends or family members. For the Tennessee Human Trafficking Hotline, contact 1-855-55-TNHTH or for immediate assistance text "are you awake" to (423) 226-1302.
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U.S. Attorney J. Douglas Overbey Announces $406,092 in Department of Justice Grant Awards to East TennesseeRead the Press Release
KNOXVILLE, Tenn. – United States Attorney J. Douglas Overbey of the Eastern District of Tennessee announced today that $406,092 was awarded in Department of Justice grants for the Byrne Memorial Justice Assistance grant (JAG) program.
The JAG program is the leading source of federal justice funding to state and local jurisdictions. The JAG Program provides states, and local governments with critical funding necessary to support a range of program areas including law enforcement, prosecution, indigent defense, courts, crime prevention and education, corrections and community corrections.
FY20 EDWARD BYRNE MEMORIAL ASSISTANCE GRANT (JAG) PROGRAM
• Blount County - $23,615
• City of Chattanooga - $127,295
• City of Cleveland - $35,670
• City of Johnson City - $15,895
• City of Kingsport - $22,847
• City of Knoxville (to share with Knox County) - $138,069
• Hamblen County - $12,999
• Sullivan County - $18,751
• Washington County - $10,951
"These grants will help address crime at various levels, and provide resources to protect and serve the citizens of East Tennessee more effectively. State and local law enforcement agencies can leverage these funds to purchase much needed equipment and hire more personnel, ultimately helping departments prepare for and respond to the community’s needs," said U.S. Attorney Overbey.
The Edward Byrne Memorial Justice Assistance Grant (JAG) Program allows states and units of local government, including tribes, to support a broad range of activities to prevent and control crime based on their own state and local needs and conditions. Grant funds can be used for state and local initiatives, technical assistance, training, personnel, equipment, supplies, contractual support, and information systems for criminal justice, including for anyone or more of the following program areas: 1) law enforcement programs; 2) prosecution and court programs; 3) prevention and education programs; 4) corrections and community corrections programs; 5) drug treatment and enforcement programs; 6) planning, evaluation, and technology improvement programs; and 7) crime victim and witness programs (other than compensation) and 8) mental health programs and related law enforcement and corrections programs.
This JAG award will be used to support criminal justice initiatives that fall under one or more of the allowable program areas above. Funded programs or initiatives may include multi-jurisdictional drug and gang task forces, crime prevention and domestic violence programs, courts, corrections, treatment, justice information sharing initiatives, or other programs aimed at reducing crime and/or enhancing public/officer safety.
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Two Active-Duty Marines Charged in Indictment Alleging Drug Trafficking Conspiracy After Fellow Marine’s Fatal Drug OverdoseRead the Press Release
LOS ANGELES – Two active-duty United States Marines stationed at Camp Pendleton were arrested today on a federal grand jury indictment charging one Marine and three civilians with conspiring to distribute narcotics – including oxycodone pills laced with fentanyl – to civilians and members of the United States Marine Corps, one of whom suffered a fatal drug overdose in May. The second Marine is charged in the indictment with being an accessory after the fact.
The 14-count superseding indictment charges five defendants:
- Jordan Nicholas McCormick, 26, of Palmdale, the lead defendant and the conspiracy’s alleged supplier who provided LSD, ecstasy, cocaine, and oxycodone pills laced with fentanyl to co-conspirators;
- Gustavo Jaciel Solis, 24, of Sylmar, who allegedly distributed McCormick’s drugs to civilians and military personnel;
- Anthony Ruben Whisenant, 20, a lance corporal in the United States Marine Corps, who allegedly distributed narcotics to active service members, including an active-duty Marine who died after ingesting an oxycodone pill laced with fentanyl purchased from Solis;
- Jessica Sarah Perez, 23, of Pacoima, who allegedly distributed narcotics including fentanyl and cocaine to the conspiracy’s civilian customers; and
- Ryan Douglas White, 22, a lance corporal in the United States Marine Corps, who is charged with being an accessory after the fact for allegedly attempting to hinder law enforcement’s apprehension of Whisenant and Solis.
Whisenant and White were taken into federal custody today and are expected to make their initial appearances this afternoon in United States District Court in Los Angeles.
On August 11, Solis and Perez were indicted on fentanyl and cocaine distribution charges, and Solis was indicted on firearms-related charges. They have pleaded not guilty to these charges and their trial date is scheduled for October 27. Solis is in federal custody and Perez is free on $25,000 bond. Today’s superseding indictment adds McCormick, Whisenant and White as defendants, in addition to adding charges to the original indictment. McCormick also is in federal custody.
According to the indictment, the conspiracy lasted from November 2019 to September 2020 and involved multiple sales of fentanyl-laced oxycodone to an undercover buyer, often for amounts exceeding $1,000 per buy.
On May 22, Solis sold 10 pills of oxycodone laced with fentanyl to an active-duty Marine who died of a drug overdose in the early morning hours of May 23, the indictment alleges.
In addition to the conspiracy charge, McCormick, Solis, Whisenant and Perez face substantive charges of distribution of narcotics, including fentanyl. McCormick and Solis are also charged with possessing firearms in furtherance of drug crimes.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
If convicted, McCormick and Solis would face a mandatory minimum of 15 years in federal prison and a statutory maximum sentence of life imprisonment. Whisenant and Perez would face a statutory maximum of 20 years in federal prison if convicted. White, if convicted, would face a statutory maximum sentence of 10 years in federal prison.
This matter was investigated by the Naval Criminal Investigative Service, the Drug Enforcement Administration, the FBI, the United States Postal Inspection Service, and the Ventura County Sheriff’s Office.
This case is being prosecuted by Special Assistant United States Attorney Patrick Castañeda and Assistant United States Attorneys Jenna Williams and Gregg E. Marmaro of the General Crimes Section.
Texas Woman Sentenced to Prison for Role in $5.5 Million Federal Worker’s Compensation Overbilling SchemeRead the Press Release
A Texas woman was sentenced to 18 months in prison today for her role in a $5.5 million scheme to overbill the U.S. Department of Labor Office of Workers’ Compensation Program for physical therapy and other services.
Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division, U.S. Attorney Erin Nealy Cox of the Northern District of Texas, Special Agent in Charge Robert Bourbon of the U.S. Department of Justice Office of the Inspector General’s (DOJ-OIG) Dallas Field Office, Special Agent in Charge Steven Grell of the U.S. Department of Labor Office of Inspector General’s (DOL-OIG) Dallas Regional Office, Special Agent in Charge Scott Pierce of the U.S. Postal Service Office of Inspector General’s (USPS-OIG) Southern Area Field Office, Acting Special Agent in Charge Patrick Roche of the U.S. Department of Veterans Affairs Office of Inspector General’s (VA-OIG) Criminal Investigations Division South Central Field Office, and Special Agent in Charge Ray Rayos of the U.S. Army Criminal Investigation Command's Major Procurement Fraud Unit (MPFU) Southwest Fraud Field Office made the announcement.
Melissa Sumerour, 49, of Lorena, Texas, was sentenced by U.S. District Judge Karen Gren Scholer of the Northern District of Texas to 18 in prison followed by three years of supervised release. After a trial in December 2019, Sumerour was convicted of six counts of health care fraud.
According to evidence presented at trial, from approximately January 2011 to March 2017, Sumerour engaged in a scheme to defraud the DOL’s Office of Workers’ Compensation Program by overbilling for physical therapy. The evidence established that the fraud, in which Sumerour billed for more physical therapy than was provided, cost the Office of Workers’ Compensation Program in excess of $5.5 million.
One other defendant has been charged in this matter. Latosha Morgan, 42, of Grand Prairie, Texas, pleaded guilty and is awaiting sentencing.
This case was investigated by DOJ-OIG, DOL-OIG, USPS-OIG, VA-OIG, and Army CID-MPFU. Trial Attorneys Brynn Schiess and Amy Markopoulos of the Criminal Division’s Fraud Section are prosecuting the case.
The Fraud Section leads the Medicare Fraud Strike Force. Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 15 strike forces operating in 24 districts, has charged more than 4,200 defendants who have collectively billed the Medicare program for nearly $19 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
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.
Suburban Pittsburgh Man Pleads Guilty to Destroying a Pittsburgh Police Vehicle during May 30th ProtestRead the Press Release
PITTSBURGH, Pa. – Brian Bartels of suburban Pittsburgh, Pennsylvania, pleaded guilty today in federal court in Pittsburgh to a charge of obstruction of law enforcement during civil disorder, United States Attorney Scott W. Brady announced today. While others were lawfully protesting over the death of George Floyd, Bartels initiated the damage to a police car outside of PPG Paints Arena, including spray painting the car and smashing its windshield. Others then joined Bartels and the police car was set on fire.
Bartels, 20, of of Allison Park, PA 15101, pleaded guilty to one count before Senior United States District Judge Arthur J. Schwab.
"On May 30, 2020, Brian Bartels incited the largest and most destructive riot in Pittsburgh history since 1968," said U.S. Attorney Brady. "Armed with his homemade agitator toolkit, this self-identified extreme left-wing anarchist came to the protest in downtown Pittsburgh that day with one goal: to incite violence. Bartels succeeded – he was the first to incite violence during the protest. While protesters yelled for him to stop, Bartels spray painted and then smashed and jumped on the windshield of a Pittsburgh Police cruiser. Others then joined in and the cruiser was set on fire and destroyed."
"Bartels’s actions were the inflection point in the demonstration," U.S. Attorney Brady added. "What was peaceful became lawless. Ultimately, Pittsburgh police cars were burned. Mounted Pittsburgh Police Officers were attacked. Projectiles were thrown at Pittsburgh Police Officers. Reporters were attacked and their camera destroyed. What started as a peaceful demonstration, turned into a violent evening of destruction and looting throughout downtown Pittsburgh."
"The violent actions of this young person were appalling," said FBI Pittsburgh Special Agent in Charge Michael Christman. "Mr. Bartels went downtown with the intent to incite panic and violence. His poor decisions put everyone, including those exercising their First Amendment
rights peacefully, in danger. This type of behavior will not be tolerated in the city we all call home. Let this guilty plea send a message to others that we will use all of our investigative resources to bring to justice those who choose to participate in criminal activity."
According to information provided to the court, on the afternoon of May 30, 2020, there was amarch/protest in downtown Pittsburgh. The defendant was part of a large crowd of protesters milling around the area of Centre Avenue above the PPG Paints Arena, near an unoccupied Pittsburgh Police SUV. At that time, Bartels removed a can of red spray paint from his backpack and sprayed an "A" on the police vehicle. Bartels then jumped on the hood of the vehicle, sprayed more paint on the vehicle, and stomped on the windshield, breaking it. Several people in the crowd began to cheer him on, and some people joined in hitting and kicking the vehicle. Bartels then jumped off the hood and attempted to break the passenger side window of the vehicle.
When interviewed by investigators, Bartels admitted to his conduct in initiating the attack on the police vehicle, and expressed remorse and regret for it. Bartels was charged federally in a criminal complaint on June 5, 2020. He was then indicted by the federal grand jury on June 9, 2020.
Judge Schwab scheduled sentencing for January 27, 2021 at 11:30 a.m. The law provides for a maximum total sentence of five years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Shaun E. Sweeney is prosecuting this case on behalf of the government.
U.S. Attorney Brady commended the Federal Bureau of Investigation and the Pittsburgh Bureau of Police for conducting the investigation leading to the charge in this case.
Statement by Department of Justice Spokesperson Kerri Kupec on the Execution of William Emmett Lecroy Jr.Read the Press Release
Department of Justice Spokesperson Kerri Kupec has issued the following statement:
“Today, William Emmett LeCroy Jr., 50, was executed at U.S. Penitentiary Terre Haute in accordance with the capital sentence recommended by a federal jury and imposed by the U.S. District Court for the Northern District of Georgia in 2004. LeCroy was pronounced dead at 9:06 p.m. EDT.
In October 2001, LeCroy robbed, raped and murdered Joann Lee Tiesler, a 30-year-old nurse. LeCroy had previously served 10 years in federal and state prison for, among other crimes, aggravated assault, burglary, child molestation, and statutory rape. After his release to supervised probation, LeCroy began planning to flee the country. In furtherance of that plan, LeCroy broke into Tiesler’s home in Gilmer County, Georgia. Once she returned, LeCroy attacked her with a shotgun, bound her hands behind her back with cable ties, strangled her with an electrical cord, and raped and sodomized her at the foot of her bed. He then slashed her throat with a knife and repeatedly stabbed her in the back. After murdering her, LeCroy stole her vehicle and drove to the Canadian border, where he was arrested. In March 2004, a federal jury found LeCroy guilty of carjacking resulting in death and unanimously recommended a sentence of death, which the district court imposed. His conviction and sentence were affirmed on appeal, and his requests for collateral relief were rejected by every court that considered them.
Nearly 19 years after brutally ending the life of Joann Lee Tiesler, William Emmett LeCroy finally has faced the justice he deserved. Family members and loved ones of Tiesler, including her father and her fiancé, witnessed the execution.”
St. Albans Man Sentenced for Federal Drug CrimeRead the Press Release
CHARLESTON, W.Va. – A St. Albans man was sentenced today for his role in a drug crime that spanned several states, announced United States Attorney Mike Stuart. John Harvey Bush Jr., 27, was sentenced to 51 months in prison to be followed by four years of supervised release. Bush had previously pled guilty to possession with intent to distribute five grams or more of methamphetamine.
“I couldn’t be prouder of the work of law enforcement in this case which kept 18 pounds of 96% pure meth from hitting our streets,” said United States Attorney Mike Stuart. “Our collaborative efforts are putting a real dent in area meth trafficking.”
On September 4, 2019, the U.S. Postal Inspection Service intercepted a package shipped from Los Angeles, California to a Charleston residence. Upon obtaining a search warrant for the package, they discovered over 18 pounds of methamphetamine inside. The majority of the methamphetamine was removed, except for 11.2 grams which remained inside the package in order to conduct a controlled delivery. As law enforcement was delivering the package, the National Guard provided helicopter surveillance of the area. Bush was recorded driving to the residence and taking the package from the front porch. He was then followed as he drove the package to his girlfriend’s residence, where he unloaded and opened the package.
Upon opening the package, Bush discovered there to be only 11.2 grams of methamphetamine and attempted to flush the shipping label to the package. Shortly afterwards, law enforcement knocked on the front door of the girlfriend’s residence. Bush saw them through the window and was arrested as he tried to flee out the back door. Bush’s cell phone was seized and searched pursuant to a federal search warrant. On the phone were text messages from a Thomas Drew Bess of Florida making Bush aware of the contents of the package, its tracking number, and when it would be arriving.
The methamphetamine was sent to the DEA laboratory, where it tested 96% pure. Law enforcement officers were able to determine that Bess had mailed the package from California. Flight records confirmed that Bess had traveled to California from Florida to mail the package of methamphetamine. Bess was subsequently arrested in Florida and brought to the Southern District of West Virginia on conspiracy charges. Bess’ phone was searched pursuant to a federal warrant, wherein evidence of drug trafficking and distribution was discovered. Bess pled guilty on August 24, 2020. Bess’ sentencing date is scheduled for December 8, 2020. He faces up to life in prison at sentencing.
The Drug Enforcement Administration (DEA), the United States Postal Service - Office of Inspector General, and the United States Postal Inspection Service conducted the investigation. The West Virginia National Guard assisted law enforcement with their investigation. Senior United States District Judge David A. Faber imposed the sentence. Assistant United States Attorney L. Alexander Hamner is handling the prosecution.
The Organized Crime Drug Enforcement Task Force (OCDETF) is an independent component of the U.S. Department of Justice. Established in 1982, OCDETF is the keystone of the Attorney General’s strategy to reduce the availability of illicit narcotics throughout the United States using a prosecutor-led, multi-agency approach to combat transnational organized crime. OCDETF agents and prosecutors nationwide handle complex investigations and prosecutions of the highest-level drug traffickers, money launderers, and other priority transnational criminal organizations that threaten the citizens of the United States. OCDETF facilitates joint operations by focusing its partner agencies on priority targets, by managing and coordinating multi-agency efforts, and by leveraging intelligence across multiple investigative platforms.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 2:19-cr-00256.
Follow us on Twitter: SDWVNews and USAttyStuart
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Sparta Man Sentenced to 14 Years for Meth ConspiracyRead the Press Release
SPRINGFIELD, Mo. – A Sparta, Missouri, man was sentenced in federal court today for leading a conspiracy to distribute methamphetamine in Christian County, Mo.
Travis W. Robinson, 40, was sentenced by U.S. District Judge Brian C. Wimes to 14 years in federal prison without parole.
On March 11, 2020, Robinson pleaded guilty to one count of conspiracy to distribute methamphetamine and one count of possessing methamphetamine to distribute on premises in which a minor resides.
Robinson came to the attention of law enforcement in August 2016 as a distributor of methamphetamine in the southwest Missouri area. Law enforcement officers executed a search warrant at Robinson’s residence and seized approximately 47.32 grams of methamphetamine, $7,628, marijuana, and drug paraphernalia. At the time the warrant was executed, Robinson’s young child was located in the living room of the residence.
In June 2017, a confidential informant told law enforcement that his/her source of methamphetamine had acquired anywhere from one-fourth of an ounce to one-fourth of a pound of methamphetamine from Robinson each week and had been doing so for several years.
Robinson imported methamphetamine to southwest Missouri, which he provided to co-conspirators for them to further distribute. Co-conspirators also assisted with activities related to drug distribution, including the collection of drug debts.
Robinson is the first defendant to be sentenced in this case. Co-defendant Candace L. Medlock, 34, of Nixa, Missouri, has pleaded guilty to her role in the conspiracy and awaits sentencing.
This case was prosecuted by Assistant U.S. Attorneys Jessica R. Sarff and Byron H. Black. It was investigated by the Christian County, Mo., Sheriff’s Department, the Missouri State Highway Patrol, and the Drug Enforcement Administration.
Shreveport Man Sentenced to 19 Years in Federal Prison for Selling Drugs and Possessing FirearmsRead the Press Release
SHREVEPORT, La. – Acting United States Attorney Alexander C. Van Hook announced that Brien Keith Powell, 51, of Shreveport, was sentenced today by U.S. District Judge Donald E. Walter. Powell was sentenced to 168 months for Possession of Crack Cocaine, and 60 months for Possession of a Firearm in Furtherance of Drug Trafficking Crime, for a total of 228 months in prison (19 years), followed by 5 years of supervised release. Powell pleaded guilty to the charges on January 10, 2020.
On March 28, 2018, officers with the Caddo/Shreveport Narcotics Task Force obtained a search warrant of Brien Keith Powell’s residence and property. Upon execution of the search warrant, officers found drug paraphernalia and a revolver in the residence. Officers also found powder and crack cocaine, ecstasy, a digital scale, another handgun and ammunition in Powell’s vehicle. Powell had over $1,500 in cash in his pocket.
After Powell was arrested by officers, he admitted that all of the narcotics and firearms belonged to him and that he was selling the narcotics to make a living. Further investigation by law enforcement revealed that the firearms had both been reported stolen. The North Louisiana Criminalistics Laboratory analyzed the narcotics and determined the drugs to be 38.34 grams of cocaine base, crack cocaine.
Powell has a lengthy criminal history, having been convicted of aggravated battery with a dangerous weapon (1986 and 1990), possession of narcotics (1990), Second Degree Kidnapping (1994), Armed Robbery (1995), Felon in Possession of Firearm (2000), Possession of a Controlled Substance (2007) and Possession of Counterfeit (2014).
The ATF and Caddo/Shreveport Narcotics Task Force conducted the investigation and Assistant United States Attorney Tennille Gilreath prosecuted the case.
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Seventeen Defendants Charged in Midlands-based Federal Drug Conspiracy after Multi-Year InvestigationRead the Press Release
Columbia, South Carolina --- United States Attorney Peter M. McCoy, Jr. announced today that federal, state, and local law enforcement officers charged 17 individuals in federal court for their roles in a drug trafficking organization that operated out of the Midlands region of South Carolina.
The charges follow a more than two-year long investigation by federal, state, and local law enforcement into a methamphetamine distribution ring in the Lexington area. The investigation resulted in the seizure of approximately 35 kilograms of methamphetamine, 116 firearms, and various quantities of heroin and fentanyl.
“The people of South Carolina deserve safe places to call home,” said U.S. Attorney McCoy. “When we work deliberatively with our federal, state, and local partners, we are able to dismantle entire drug-dealing organizations and make communities safer. These charges speak to those efforts.”
“Collaborative public safety efforts such as this investigation have an immediate and long-lasting impact on our communities,” said Vincent Pallozzi, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Special Agent in Charge. “The work we do in partnership with our local, state, and federal law enforcement agencies has made significant and ongoing progress in creating safer neighborhoods.”
“This operation shows how local and federal agencies can work together to make communities safer,” said Lexington County Sheriff Jay Koon. “In operations like these, deputies and agents teamed up to get sources of drugs and weapons off the street. We’re thankful for the relationships we have with our counterparts at the federal level. When we have a united front against crime that really makes a difference in the lives of those we serve.”
The following defendants have been charged in the criminal complaint for conduct related to their alleged roles in the drug trafficking organization:
Matthew Ward, 36, of Lexington;
Alecia Youngblood, 38, of Lexington;
Cynthia Rooks, 52, of Lexington;
Rebecca Martinez, 33, of Lexington;
Richard Ford, 62, of Lexington;
Amber Hoffman, 26, of Lexington;
Samuel Judy, 29, of Lexington;
Brian Bruce, 48, of West Columbia;
Montana Barefoot, 25, of Lexington;
John Johnson, 36, of Gaston;
Benjamin Singleton, 46, of Gaston;
Kayla Mattoni, 38, of Lexington;
Clifford Kyzer, 35, of Lexington;
Kelly Jordan, 34, of Williamston;
Kelly Still, 43, of Windsor;
Tiffanie Brooks, 36, of Columbia; and
Robert Figueroa, 43, of West Columbia.
The case began in July 2017 as an investigation by a number of agencies, including ATF, the Lexington County Multi-Agency Narcotics Enforcement Team, and the Eleventh Circuit Solicitor’s Office, into methamphetamine trafficking and the illegal sale of firearms. According to the criminal complaint, the investigation identified Youngblood, Ward, and others as key methamphetamine suppliers for major distributors in the Lexington area. Further, the investigation ultimately identified Ward as a leader of the drug trafficking organization, which would move drugs across state lines and which also participated in the unlicensed dealing of firearms. During the course of the investigation, law enforcement officers used controlled purchases, confidential informants, and other means to identify, arrest, and charge the other alleged members of the drug trafficking organization.
The case was investigated by the ATF, Federal Bureau of Investigation (FBI), Lexington County Sheriff’s Department, Lexington County Multi-Agency Narcotics Enforcement Team, Greenville County Sheriff’s Office, Anderson County Sheriff’s Office, and South Carolina Department of Corrections.
This case is being prosecuted as part of the joint federal, state, and local Project Safe Neighborhoods (PSN), 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.
Special Assistant U.S. Attorney Casey Rankin Smith of the Eleventh Judicial Circuit is prosecuting the case, alongside Trial Attorney Lisa Man with the Department of Justice Criminal Division’s Organized Crime and Gang Section, and Assistant U.S. Attorneys Brandi Hinton and Justin Holloway of the Greenville office.
The United States Attorney stated that all charges against these defendants are merely accusations and that all defendants are presumed innocent until and unless proven guilty.
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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.
dsc_press_release_drugconsp.pdfSerial Fraudster Sentenced for Multiple Financial SchemesRead the Press Release
ALEXANDRIA, Va. – A Maryland man was sentenced today to six years in prison for aggravated identity theft and conspiring to defraud over 20 financial institutions.
According to court documents, Chea S. Yarl, 31, was the leader of a conspiracy to defraud 20 banks located throughout Maryland, Washington, D.C., and Virginia for at least seven years. From 2013 through 2019, Yarl organized a card-cracking scheme in which he and at least four other individuals deposited counterfeit checks and other worthless financial instruments into hundreds of bank accounts and then quickly made cash withdrawals or purchased money orders with debit cards associated with the accounts. Yarl and his co-conspirators recruited hundreds of accountholders of different financial institutions to provide their debit cards and PINs in exchange for payment. Yarl then created counterfeit checks purportedly issued by 20 different financial institutions, which he and others acting at his direction then deposited into the accounts. These deposits fraudulently induced the targeted financial institutions to credit thousands of dollars to those accounts, which Yarl and others immediately withdrew. Between 2013 and 2019, Yarl and others deposited over 300 worthless checks and money orders totaling more than $1 million into over 200 compromised accounts and successfully withdrew at least $316,000 of the credited proceeds.
During the same period, Yarl used various other techniques to defraud individuals and companies of hundreds of thousands of dollars. In April 2019, Yarl and an unknown conspirator fraudulently accessed a retirement account belonging to a U.S. Postal Service employee and caused $108,000 to be transferred to a bank account controlled by Yarl. In November 2019, Yarl organized a business e-mail compromise scam to fraudulently induce a company to wire over $87,000 to a bank account controlled by Yarl and his co-conspirators and then successfully withdrew $60,000 of those funds.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia; Robert E. Bornstein, Acting Special Agent in Charge of the FBI Washington Field Office Criminal Division; Peter R. Rendina, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service; and Colonel Gary T. Settle, Virginia State Police Superintendent, made the announcement after sentencing by Senior U.S. District Judge Liam O'Grady. Special Assistant U.S. Attorney Rachael C. Tucker prosecuted the case.
This case was investigated by the FBI WFO's Transnational Organized Crime Task Force which is composed of FBI Agents, along with task force officers from local, state, and federal partners. This task force is charged with identifying and investigating the most egregious organized crime syndicates operating in Northern Virginia. Significant investigative assistance was provided by the USPIS and Virginia State Police.
The FBI’s Cleveland Field Office provided significant assistance to this investigation.
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-49.
Sargeant Marine Inc. Pleads Guilty and Agrees to Pay over $16 Million in Criminal Fines to Resolve Foreign Bribery CaseRead the Press Release
Earlier today, in federal court in Brooklyn, Sargeant Marine Inc., an asphalt company incorporated and formerly headquartered in Boca Raton, Florida, pleaded guilty and agreed to pay $16.6 million to resolve foreign bribery charges stemming from conduct by the company and its employees and agents in Brazil, Venezuela and Ecuador. In each one of the countries, the company paid bribes to government officials to obtain contracts to purchase or sell asphalt to the countries’ state-owned companies in violation of the Foreign Corrupt Practices Act (FCPA). Today’s proceedings took place by video before the United States District Judge Eric N. Vitaliano. Previously, a corporate executive for Sargeant Marine, Daniel Sargeant; two Sargeant Marine traders who were active in Brazil, Venezuela and Ecuador, Roberto Finocchi and Jose Tomas Meneses; an agent and a consultant who acted as bribe intermediaries in Brazil and Venezuela, Luiz Eduardo Andrade and David Diaz; and a former Venezuelan government official, Hector Nunez Troyano, who received some of the bribes, pled guilty. In addition, on September 10, 2020, a criminal complaint was unsealed in federal court in Brooklyn charging another former Venezuelan official with conspiracy to commit money laundering, in part for his alleged role in the Sargeant Marine Venezuela scheme.
Seth D. DuCharme, Acting United States Attorney for the Eastern District of New York, Brian C. Rabbitt, Acting Assistant Attorney General of the Justice Department’s Criminal Division, and Calvin A. Shivers, Assistant Director, Federal Bureau of Investigtion, Criminal Investigative Division (FBI), announced the guilty pleas and resolution.
“Today’s resolution is the result of a multi-year, multi-national, collaborative effort to root out corruption perpetrated by an American company in three countries,” stated Acting U.S. Attorney DuCharme. “We will continue to investigate and prosecute any company that corrupts foreign government officials in order to gain a competitive edge, as well as any of their executives and employees who participate in those efforts.”
“With today’s guilty plea, Sargeant Marine has admitted to engaging in a long-running pattern of paying bribes to corrupt officials in three South American countries to obtain lucrative business,” stated Acting Assistant Attorney General Rabbitt. “Today’s resolution, together with charges the department has brought against individuals involved in Sargeant Marine’s illegal schemes, demonstrates the department’s continuing commitment to holding companies and their executives responsible for international corruption.”
“The FBI is dedicated to rooting corruption out of our market, keeping the United States fair for vendors and consumers alike," stated FBI Assistant Director Shivers. “Sargeant Marine, Inc. attempted to get ahead of competitors by paying bribes to foreign officials in violation of the Foreign Corrupt Practices Act. As today's guilty pleas demonstrate, the FBI will relentlessly investigate those attempting to cheat the market, and we will bring them to justice.”
According to the Statement of Facts stipulated to by Sargeant Marine in connection with its guilty plea and other court documents, between approximately 2010 and 2018, Sargeant Marine, through its employees and agents, conspired to pay bribes to foreign officials in Brazil, Venezuela and Ecuador to secure lucrative contracts. As a result of these bribes, Sargeant Marine and its affiliated companies earned profits of over $38 million.
In Brazil, Sargeant Marine and its related companies bribed officials at the state-owned oil company, Petróleo Brasileiro S.A. - Petrobras (Petrobras), to obtain contracts to sell asphalt to Petrobras. From approximately 2010 to 2015, Sargeant Marine and its affiliates, through its employees and agents, concealed bribe payments to Brazilian government officials by creating fake consulting contracts and fake invoices by using cash payments and by wiring millions of dollars from the United States to offshore bank accounts held in the name of shell companies of bribe middlemen. As a result of the Brazilian bribery scheme, Sargeant Marine and its affiliated companies earned profits of approximately $26.5 million.
The conduct in Brazil began when a Sargeant Marine senior executive officer traveled to Brazil in January 2010 in an effort to identify an agent with connections to a government official who could help the company obtain business from Petrobras. Eventually, the company began paying bribes to a “lobbyist” who was known to receive payments for his connections to Petrobras officials. At a dinner arranged by the Sargeant Marine intermediary with a Petrobras official and a Brazilian politician, the intermediary promised bribes in return for securing contracts between Petrobras and Sargeant Marine. After a company affiliated with Sargeant Marine completed shipments of asphalt to Petrobras in August 2010, the affiliate’s executive emailed Daniel Sargeant stating, “Wow guess last Brazil trip with crooks paid off. Should go again before contract next year gets hot and heavy.”
Between approximately 2012 and 2018, Sargeant Marine engaged in similar conduct in Venezuela, this time to purchase asphalt from the state-controlled oil company, Petroleos de Venezuela S.A. (PDVSA). Sargeant Marine and its affiliates—which had been blacklisted by PDVSA—used a Swiss company that would resell the asphalt to Sargeant Marine at a small premium. As it did in Brazil, Sargeant Marine concealed the bribes by creating fake consulting contracts and fake invoices and by making payments to offshore bank accounts held by a bribe middleman. The bribe middleman then paid bribes to a PDVSA official. Sargeant Marine’s bribe payments also gave it access to non-public information from PDVSA officials to give Sargeant Marine a corrupt edge on its competition. As a result of the Venezuela bribery scheme, Sargeant Marine earned about $8.2 million in profits.
Sargeant Marine paid bribes to an official working for Empresa Publica de Hidrocarburos del Ecuador (Petroecuador), a state-owned oil company of Ecuador that needed asphalt to supply the country. Sargeant Marine and its affiliates used the same tactics as in Brazil and Venezuela to conceal bribe payments, made through an intermediary to a Petroecuador official, which were made to secure a contract with Petroecuador. As a result of this scheme, Sargeant Marine earned profits of approximately $3.2 million.
In September 2017, Andrade pleaded guilty to conspiring to violate the FCPA. In November 2017, Finocchi pleaded guilty to conspiracy to defraud the United States. In March 2018, Diaz pleaded guilty to two counts of conspiring to violate the FCPA. In August 2018, Meneses pleaded guilty to conspiring to violate the FCPA. In March 2019, Troyano pleaded guilty to money laundering conspiracy. In December 2019, Daniel Sargeant pleaded guilty to conspiracy to violate the FCPA and conspiracy to commit money laundering. The defendants are awaiting sentencing.
The investigation is being conducted by FBI's International Corruption squad in Miami. The government’s case is being handled by the Office’s Business and Securities Fraud Section and the Criminal Division’s Fraud Section. Assistant United States Attorneys Whitman Knapp, Mark E. Bini and Andrey Spektor of the Eastern District of New York and Fraud Section Trial Attorney Derek J. Ettinger are prosecuting the case.
The government of Brazil provided significant assistance in this matter, as did the Criminal Division’s Office of International Affairs.
The Defendant:
SARGEANT MARINE, INC.
E.D.N.Y. Docket No.: 20-CR-363 (ENV)
DANIEL SARGEANT
Age: 53
Florida, United StatesE.D.N.Y. Docket No.: 19-CR-319 (ENV)
ROBERTO FINOCCHI
Age: 58
Country of Origin: VenezuelaE.D.N.Y. Docket No.: 17-CR-600 (ENV)
JOSE TOMAS MENESES
Age: 65
Country of Origin: VenezuelaE.D.N.Y. Docket No.: 18-CR-358 (ENV)
LUIZ EDUARDO ANDRADE
Age: 61
Country of Origin: BrazilE.D.N.Y. Docket No. 17-CR-497 (ENV)
DAVID DIAZ
Age: 56
Country of Origin: VenezuelaE.D.N.Y. Docket No.: 18-CR-140 (ENV)
Hector Nunez Troyano
Age: 43
Country of Origin: VenezuelaE.D.N.Y. Docket No. 19-CR-135 (ENV)
Sargeant Marine Inc. Pleads Guilty and Agrees to Pay $16.6 Million to Resolve Charges Related to Foreign Bribery Schemes in Brazil, Venezuela, and EcuadorRead the Press Release
Sargeant Marine Inc., an asphalt company formerly based in Boca Raton, Florida, pleaded guilty today to conspiracy to violate the anti-bribery provisions of the Foreign Corrupt Practices Act (FCPA) and agreed to pay a criminal fine of $16.6 million to resolve charges stemming from a scheme to pay bribes to foreign officials in three South American countries.
According to its admissions, between 2010 and 2018, the company paid millions of dollars in bribes to foreign officials in Brazil, Venezuela, and Ecuador to obtain contracts to purchase or sell asphalt to the countries’ state-owned and state-controlled oil companies, in violation of the FCPA.
“With today’s guilty plea, Sargeant Marine has admitted to engaging in a long-running pattern of paying bribes to corrupt officials in three South American countries to obtain lucrative business,” said Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division. “Today’s resolution, together with charges the department has brought against individuals involved in Sargeant Marine’s illegal schemes, demonstrates the department’s continuing commitment to holding companies and their executives responsible for international corruption.”
“Today’s resolution is the result of a multi-year, multi-national, collaborative effort to root out corruption perpetrated by an American company in three countries,” said Acting U.S. Attorney Seth DuCharme of the Eastern District of New York. “We will continue to investigate and prosecute any company that corrupts foreign government officials in order to gain a competitive edge, as well as any of their executives and employees who participate in those efforts.”
“The FBI is dedicated to rooting corruption out of our market, keeping the United States fair for vendors and consumers alike,” said Assistant Director Calvin Shivers of the FBI’s Criminal Investigative Division. “Sargeant Marine Inc. attempted to get ahead of competitors by paying bribes to foreign officials in violation of the Foreign Corrupt Practices Act. As today's guilty pleas demonstrate, the FBI will relentlessly investigate those attempting to cheat the market, and we will bring them to justice.”
According to the company’s admissions, Sargeant Marine Inc. and its affiliated companies (Sargeant Marine) engaged in an eight-year scheme to bribe foreign officials in Brazil, Venezuela, and Ecuador. In Brazil, Sargeant Marine admitted to bribing a Minister in the Brazilian government, a high-ranking member of the Brazilian Congress, and senior executives at Petróleo Brasileiro S.A.-Petrobras to obtain valuable contracts to sell asphalt. To execute the scheme and conceal the bribe payments, Sargeant Marine entered into fake consulting agreements with bribe intermediaries. After receiving fake invoices, it then sent international wires from Sargeant Marine bank accounts to offshore bank accounts held in the names of shell companies controlled by the bribe intermediaries. The bribe intermediaries used a portion of the commissions to pay bribes to Brazilian government officials on Sargeant Marine’s behalf, either by wire to the officials’ offshore shell companies, or in cash in Brazil.
Sargeant Marine also admitted that between approximately 2012 and 2018, it bribed four Petróleos de Venezuela, S.A. (PDVSA) officials in Venezuela in exchange for inside information, and for their assistance in steering contracts to purchase asphalt from PDVSA to a Sargeant Marine nominee. The Sargeant Marine co-conspirators used code names to hide the identities of some of the PDVSA officials receiving the bribes, referring to them simply as “Oiltrader,” “Tony,” and “Tony 2” in emails and texts. The inside information was called “Chocolates.” Similar to Brazil, Sargeant Marine covered up the bribes by entering into fake consulting agreements with a bribe intermediary and wiring commission payments into U.S. and offshore bank accounts he controlled. The bribe intermediary then paid the PDVSA officials on behalf of Sargeant Marine.
Sargeant Marine also admitted that it bribed an official at Ecuador’s state-owned oil company EP Petroecuador (Petroecuador) to secure a 2014 contract to supply asphalt. The company used the same tactics as in Brazil and Venezuela to conceal the bribe payments. In particular, it engaged a bribe intermediary with close ties to a decisionmaker at Petroecuador and then paid commissions to the bribe intermediary pursuant to a sham consulting agreement. The intermediary used the commission payments to pay the bribes to the Petroecuador official on Sargeant Marine’s behalf.
The department recently unsealed charges against, and the guilty pleas of, five of the individuals who played a major role in the bribery scheme, including Daniel Sargeant, a senior executive of the company; Jose Tomas Meneses, a Sargeant Marine trader; Luiz Eduardo Andrade and David Diaz, consultants who acted as bribe intermediaries in Brazil and Venezuela, respectively; and Hector Nuñez Troyano, a former PDVSA official who received bribes in connection with the Venezuela contracts. A sixth individual, Roberto Finocchi, also a Sargeant Marine trader, pleaded guilty in November 2017 for his role in the Brazil scheme.
On Sept. 10, 2020, a criminal complaint was unsealed in federal court in Brooklyn charging another former PDVSA official with conspiracy to commit money laundering, in part, for his alleged role in the Sargeant Marine Venezuela scheme.
The investigation is being conducted by the FBI’s International Corruption Unit. The government’s case is being handled by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of New York. Fraud Section Trial Attorney Derek J. Ettinger and Assistant U.S. Attorneys Whitman Knapp, Mark E. Bini, and Andrey Spektor are prosecuting the case.
The Justice Department’s Office of International Affairs provided substantial assistance. The Ministerio Publico Federal in Brazil provided significant cooperation.
The Fraud Section is responsible for investigating and prosecuting all FCPA matters. Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.
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.
Salem Man Sentenced to 60 Months for Distribution of Child PornographyRead the Press Release
CONCORD - Leonidas N. Mavrogenis, Jr., 62, of Salem, was sentenced to serve 60 months in federal prison for distribution of child pornography, United States Attorney Scott W. Murray announced today. Mavrogenis was also ordered to pay $8,000 in restitution.
According to court documents and statements made in court, during an ongoing undercover investigation, a member of the New Hampshire Internet Crimes Against Children (ICAC) Task Force accessed a peer-to-peer network to identify users who may be sharing images of child pornography. Between February 8, 2018, and March 23, 2018, law enforcement officers conducted downloads of child pornography from an I.P. address later found to belong to Mavrogenis. On August 1, 2018, law enforcement executed a search warrant at the defendant’s residence in Salem. During the search, law enforcement seized computer equipment and electronic devices for forensic examination. Subsequent forensic examination revealed thousands of still images and hundreds of video files containing child pornography, including videos and images downloaded by law enforcement during their investigation.
“Those who distribute child pornography are sharing horrific images of young people who have been abused,” said U.S. Attorney Murray. “In order to stop this savage exploitation of children, we will continue to work closely with our law enforcement partners to see that those responsible are held accountable in court. This serious crime will result in serious federal prison time.”
“This sentence serves as a warning to any who diminish the seriousness of the sharing of such disturbing images.” said Michael Shea, acting Special Agent in Charge, Homeland Security Investigations (HSI), Boston. “Together with our partners in the New Hampshire Internet Crimes Against Children Task Force, HSI Boston congratulates the U.S. Attorney’s office for their success in ensuring justice was done in this case. We hope today’s sentence brings some measure of restoration to the lives of those who are victimized by the actions of Mavrogenis and any others who spread this garbage online.”
This matter was investigated by the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations and the New Hampshire Internet Crimes Against Children Task Force. The case was prosecuted by Assistant U.S. Attorney Cam Le.
In February 2006, the Department of Justice introduced Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the United States Attorney’s Offices, 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 identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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