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21 September 2020
Computer Programmer Pleads Guilty in Manhattan Federal Court to Making False Statements About His Involvement in the “Silk Road” WebsiteRead the Press Release
Audrey Strauss, the Acting United States Attorney for the Southern District of New York, Joleen Simpson, Acting Special Agent in Charge of the Boston Field Office of the Internal Revenue Service, Criminal Investigation (“IRS-CI”), William F. Sweeney Jr., Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), and Peter C. Fitzhugh, the Special Agent-in-Charge of the New York Field Office of Homeland Security Investigations (“HSI”), announced that MICHAEL R. WEIGAND, a/k/a “Shabang,” a/k/a “~Shabang~,” a/k/a “~s,” a/k/a “s,” pled guilty today to making false statements to federal agents about his involvement in, and his work for, the “Silk Road” online illicit black market, which was responsible for distributing hundreds of millions of dollars of narcotics and other contraband. WEIGAND’s false statements concealed his role in the operation of the Silk Road website. WEIGAND surrendered today and pled guilty before United States District Judge William H. Pauley III, to whom his case is assigned.
Acting U.S. Attorney Audrey Strauss said: “Silk Road was a secret online marketplace for illegal drugs, hacking services, and a number of other criminal activities. Michael Weigand helped Silk Road by, among other things, identifying technological vulnerabilities in the site, supplying technological advice directly to Silk Road’s leadership, and travelling overseas to remove Silk Road evidence from a co-conspirator’s residence. When Weigand was questioned by law enforcement in 2019, he falsely claimed not to have done anything at all for Silk Road. For his various false statements, Weigand now faces potential prison time.”
IRS-CI Acting Special Agent in Charge Joleen Simpson said: “During its years of operation the Silk Road website allowed thousands of individuals to anonymously conduct narcotics transactions, launder money, and facilitate other illegal transactions. This investigation took law enforcement above and beyond its traditional role in financial crimes. In effect, it put us squarely in the middle of the high-tech world of cyber-crime and the dark web. When given the opportunity to provide truthful statements to the agents, Weigand knowingly and willfully attempted to deceive the agents of the role he played in providing technical expertise to the Silk Road operators. I hope that this guilty plea will discourage others from providing false information to law enforcement officers in the future.”
FBI Assistant Director William F. Sweeney Jr. said: “Weigand and others used their skills and savvy to create a secret online enclave for criminals to trade in illegal drugs and illicit goods and services. They thought they were smart enough to evade law enforcement, but they were wrong. When Weigand was confronted, he lied about his involvement – once again thinking we weren’t smart enough to catch him. With today’s plea, he’ll have time to contemplate the truth as he awaits his sentence.”
HSI Special Agent-in-Charge Peter C. Fitzhugh said: “Criminal activity on the dark web continues to be more prevalent, allowing easy accessibility to narcotics and illicit goods with the click of a button. With online criminal enterprises growing, law enforcement technologies are advancing, and HSI with its partners are infiltrating the dark web, intercepting online dealings and locating the perpetrators. Today’s guilty plea should stand as reminder to those criminals who have a false sense of security behind their computer screen, that they too will one day face the consequences of their actions.”
According to the allegations in the Information, court filings, statements made in court, and evidence presented during the 2015 trial of Ross Ulbricht, Silk Road’s founder and chief administrator:
Ulbricht created Silk Road in approximately January 2011, and owned and operated the underground website until it was shut down by law enforcement in October 2013. Silk Road emerged as the most sophisticated and extensive criminal marketplace on the Internet at the time. During its more than two-and-a-half years in operation, Silk Road was used by several thousand drug dealers and other unlawful vendors to distribute hundreds of kilograms of illegal drugs and other illicit goods and services to well over one hundred thousand buyers, and to launder hundreds of millions of dollars deriving from these unlawful transactions. Silk Road was specifically designed to allow its users to buy and sell drugs and other illegal goods and services anonymously and outside the reach of law enforcement through the use of the Tor network and a Bitcoin-based payment system.
WEIGAND – who is a computer programmer and electrical engineer – worked with Roger Thomas Clark, the senior adviser to Ulbricht, on certain aspects of Silk Road. For instance, WEIGAND and Clark worked to identify technological vulnerabilities in the Silk Road website. WEIGAND also supplied technological advice directly to Clark and Ulbricht. In January 2019, WEIGAND was questioned by an IRS Special Agent and an FBI Special Agent. After being specifically warned that it is a federal crime to make a false statement to a federal law enforcement officer, WEIGAND attempted to cover up his involvement in Silk Road by falsely stating, among other things, that (1) he never opened an account on Silk Road; (2) he never used the online pseudonyms “Shabang” or “~Shabang~”; (3) he never transferred Bitcoin to Silk Road; (4) he never exposed computer security vulnerabilities in the Silk Road website; (5) he never communicated with anyone who used the online pseudonym “Dread Pirate Roberts,” “DPR,” or “Silk Road”; (6) he never performed any services for the Silk Road website; and (7) he did not know the true identity of “Variety Jones” (one of Clark’s pseudonyms) on Silk Road. WEIGAND also falsely stated that the purpose of his trip to London in late 2013, following the takedown of the Silk Road website and arrest of Ulbricht, was to meet with Clark’s associate regarding a marijuana seed business. In fact, WEIGAND traveled to Clark’s London residence and removed Silk Road evidence.
WEIGAND, 56, of Kirtland, Ohio, pled guilty to one count of making false statements, which carries a maximum sentence of five years in prison. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. WEIGAND is scheduled to be sentenced by Judge Pauley on December 18, 2020, at 2:00 p.m.
The founder and operator of Silk Road, Ross Ulbricht, was previously convicted of seven offenses after a jury trial: distributing narcotics, distributing narcotics by means of the Internet, conspiring to distribute narcotics, engaging in a continuing criminal enterprise, conspiring to commit computer hacking, conspiring to traffic in false identity documents, and conspiring to commit money laundering. Ulbricht was sentenced principally to life imprisonment and $183 million in forfeiture. The senior adviser to Ulbricht, Roger Thomas Clark, pled guilty to conspiring to distribute narcotics and his sentencing is currently pending; Clark faces a maximum potential sentence of 20 years in prison.
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Ms. Strauss praised the outstanding joint efforts of the IRS-CI, the FBI, and HSI. Ms. Strauss also thanked the FBI’s Cleveland Office for its assistance.
This case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorney Michael D. Neff is in charge of the prosecution.
Child Sex Trafficker Receives Fifteen Years in Federal PrisonRead the Press Release
Assistant U. S. Attorney Katherine McGrath (619) 546-9054
NEWS RELEASE SUMMARY – September 21, 2020
SAN DIEGO – Joseph Price was sentenced in federal court today for sex trafficking a minor in San Diego in July and August 2019, in violation of 18 U.S.C. § 1591. Price was sentenced to fifteen years in custody by U.S. District Judge Larry Alan Burns.
In his plea agreement, Price admitted that on approximately 11 occasions, he caused a 15-year old girl to engage in commercial sex acts in San Diego. On at least one occasion, he admitted that he hit the minor in order to make her complete the sex acts. As part of his plea, Price further admitted to meeting two additional minor females in Texas over “Instagram” and then encouraging them to engage in commercial sex acts. One of these girls also engaged in commercial sex acts in Texas and sent the money she made to Price. Both were being encouraged by Price to leave their family and friends in Texas and travel to San Diego to continue working for Price when law enforcement intervened.
“Sex trafficking of teenagers targets some of the most vulnerable individuals in our community, and leaves in its wake trauma that can affect victims for the rest of their lives,” said U.S. Attorney Robert S. Brewer, Jr. “The U.S. Attorney’s Office is deeply committed to ensuring that justice is done for the victims of these horrible crimes.” Brewer praised prosecutor Katherine McGrath and the San Diego Human Trafficking Task Force for working hard to protect children.
This case is the result of the ongoing efforts of the Violent Crime and Human Trafficking (VCHT) Section. Formed in 2019 by U.S. Attorney Brewer, the VCHT is tasked with leading collaborations between federal and local law enforcement in the investigation and prosecution of cases involving violent crimes, firearms and gang cases; sex trafficking and child exploitation; civil rights, and labor trafficking. The VCHT Section oversees the Southern District of California Coordinators for Project Safe Neighborhoods, Human Trafficking, and Project Safe Childhood.
DEFENDANT Case Number 19-CR-3649-LAB
Joseph Price Age: 24 San Diego
SUMMARY OF CHARGES
18 U.S.C. § 1591, Sex Trafficking of a Minor
Maximum penalty: Mandatory minimum of 10 years and a maximum of life in prison; a maximum fine of $250,000, at least five years of supervised release and up to life.
AGENCY
San Diego Human Trafficking Task Force
Chicago Tech Executive Charged with Illegally Exporting Computer Equipment to PakistanRead the Press Release
A Chicago-area resident who owns a Pakistani technology company has been indicted for allegedly illegally exporting computer equipment from the United States to a nuclear research agency of the Pakistani government.
Obaidullah Syed owned Pakistan-based Business System International Pvt. LTD., and Chicago-based BSI USA. The companies provided high-performance computing platforms, servers, and software application solutions. From 2006 to 2015, Syed and Business System International conspired with company employees in Pakistan to violate the International Emergency Economic Powers Act by exporting computer equipment from the United States to the Pakistan Atomic Energy Commission without obtaining the required authorization from the U.S. Department of Commerce, according to an indictment returned in the U.S. District Court in Chicago. The Pakistan Atomic Energy Commission, according to the indictment, was a Pakistani government agency responsible for “the design, fabrication, and testing of high explosives and nuclear weapons parts, uranium mining and enrichment, and the development of solid-fueled ballistic missiles.”
The indictment charges Syed, 65, of Northbrook, and Business System International with one count of conspiracy to violate the International Emergency Economic Powers Act and foreign trade regulations, and one count of violating the International Emergency Economic Powers Act. Syed was arrested Wednesday, Sept. 16, 2020, and remains in federal custody. A detention hearing is scheduled for today at 1:00 p.m. CDT before U.S. Magistrate Judge M. David Weisman in Chicago.
The indictment was announced by Assistant Attorney General for National Security John C. Demers, John R. Lausch, Jr., U.S. Attorney for the Northern District of Illinois; James M. Gibbons, Special Agent-in-Charge of the Chicago office of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; Dan Clutch, Special Agent-in-Charge of the U.S. Department of Commerce, Bureau of Industry and Security-Office of Export Enforcement, Chicago Field Office; and Cynthia Bruce, Special Agent-in-Charge of the U.S. Department of Defense, Defense Criminal Investigative Service, Southeast Field Office. The government is represented by Assistant U.S. Attorney Peter M. Flanagan.
According to the indictment, Syed, Business System International and the other conspirators falsely represented to U.S.-based computer manufacturers that the illegal shipments were intended for Pakistan-based universities, Syed’s business, or Syed himself, when, in fact, the conspirators knew that the true end user and ultimate consignee of each shipment was either the Pakistan Atomic Energy Commission or a research institute that trained the agency’s engineers and scientists, the indictment states. In so doing, according to the indictment, Syed and his company caused the U.S.-based computer manufacturers to submit to the U.S. government shipping documents, including Shippers Export Declarations, that listed false end-users for the U.S.-origin goods, thereby undermining the U.S. government’s ability to stop the illegal shipments.
The public is reminded that an indictment is not evidence of guilt. The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. The conspiracy count is punishable by a maximum sentence of five years in federal prison, while violating the International Emergency Economic Powers Act carries a maximum sentence of 20 years. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.
Chicago Tech Executive Charged with Illegally Exporting Computer Equipment to PakistanRead the Press Release
CHICAGO —A Chicago-area resident who owns a Pakistani technology company has been indicted for allegedly illegally exporting computer equipment from the United States to a nuclear research agency of the Pakistani government.
OBAIDULLAH SYED owned Pakistan-based BUSINESS SYSTEM INTERNATIONAL PVT. LTD., and Chicago-based BSI USA. The companies provided high-performance computing platforms, servers, and software application solutions. From 2006 to 2015, Syed and Business System International conspired with company employees in Pakistan to violate the International Emergency Economic Powers Act by exporting computer equipment from the United States to the Pakistan Atomic Energy Commission without obtaining the required authorization from the U.S. Department of Commerce, according to an indictment returned in U.S. District Court in Chicago. The Pakistan Atomic Energy Commission, according to the indictment, was a Pakistani government agency responsible for “the design, fabrication, and testing of high explosives and nuclear weapons parts, uranium mining and enrichment, and the development of solid-fueled ballistic missiles.”
The indictment charges Syed, 65, of Northbrook, and Business System International with one count of conspiracy to violate the International Emergency Economic Powers Act and foreign trade regulations, and one count of violating the International Emergency Economic Powers Act. Syed was arrested on Sept. 16, 2020, and remains in federal custody. A detention hearing is scheduled for today at 1:00 p.m. CDT before U.S. Magistrate Judge M. David Weisman in Chicago.
The indictment was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; James M. Gibbons, Special Agent-in-Charge of the Chicago office of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; Dan Clutch, Special Agent-in-Charge of the U.S. Department of Commerce, Bureau of Industry and Security-Office of Export Enforcement, Chicago Field Office; and Cynthia Bruce, Special Agent-in-Charge of the U.S. Department of Defense, Defense Criminal Investigative Service, Southeast Field Office. The government is represented by Assistant U.S. Attorney Peter M. Flanagan.
According to the indictment, Syed, Business System International and the other conspirators falsely represented to U.S.-based computer manufacturers that the illegal shipments were intended for Pakistan-based universities, Syed’s business, or Syed himself, when, in fact, the conspirators knew that the true end user and ultimate consignee of each shipment was either the Pakistan Atomic Energy Commission or a research institute that trained the agency’s engineers and scientists, the indictment states. In so doing, according to the indictment, Syed and his company caused the U.S.-based computer manufacturers to submit to the U.S. government shipping documents, including Shippers Export Declarations, which listed false end-users for the U.S.-origin goods, thereby undermining the U.S. government’s ability to stop the illegal shipments.
The public is reminded that an indictment is not evidence of guilt. The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. The conspiracy count is punishable by a maximum sentence of five years in federal prison, while violating the IEEPA carries a maximum sentence of 20 years. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.
Chairman of Venture Capital Funds Pleads Guilty in Mahhattan Federal Court to Securities and Wire FraudRead the Press Release
Audrey Strauss, the Acting United States Attorney for the Southern District of New York, announced today that DAVID WAGNER pled guilty to securities fraud and wire fraud in connection with his operation of a number of corporate entities (collectively referred to as “Downing”) as a Ponzi-like scheme. WAGNER solicited over $8 million from Downing investors through materially false and misleading statements and misappropriated a significant portion of those funds, using them for, among other things, the payment of management fees, the repayment of prior investors, and personal expenses. WAGNER pled guilty before U.S. District Judge Alvin K. Hellerstein.
Acting Manhattan U.S. Attorney Audrey Strauss said: “As he admitted in court, David Wagner conned employee-investors into handing over more than $8 million they thought would be invested in a viable operation that would generate returns. Instead, Wagner’s business was largely a sham, and employee-investor funds went to pay Wagner’s personal expenses or pay off other investors in Ponzi-like fashion. David Wagner now awaits sentencing for his crimes.”
According to the Indictment filed in Manhattan federal court:
From at least in or about December 2013 through at least in or about 2017, WAGNER, the chief executive officer of Downing, and Lawrence, the president of several Downing entities, solicited investments in Downing, a purported venture capital firm that would invest in healthcare start-ups referred to as “portfolio companies” and provide sales, operations, and management expertise to the portfolio companies in order to bring their products to market and generate returns for Downing investors, who also worked for Downing (the “employee-investors”). WAGNER and Lawrence, and others acting at their direction, solicited more than approximately $8 million in investments in Downing from employee-investors located across the United States, including in the Southern District of New York, as a requirement of employment with Downing.
After making the required investment of between $150,000 and $250,000 in Downing and starting their employment at Downing, employee-investors soon learned, among other things, that contrary to representations made by WAGNER and Lawrence, and others acting at their direction, Downing did not have access to millions of dollars in funding, often could not make payroll, had virtually no products to sell, and employee investments were the overwhelming source of funding. Employee-investors also learned that WAGNER and Lawrence had misrepresented the companies in Downing’s portfolio, their product readiness, and ability to generate revenue. While the particular formulation of these misrepresentations shifted over time, WAGNER and Lawrence systematically sought and obtained employee-investor money through materially false and misleading statements.
Beginning in or about May 2016, after several employee-investors had brought lawsuits against WAGNER, Lawrence, and several Downing entities alleging claims based on, among other things, fraud, WAGNER and Lawrence continued the scheme by recruiting employee-investors into a new company called Cliniflow Technologies, LLC (“Cliniflow”), through materially false and misleading statements about Cliniflow’s cash reserves, portfolio companies, and exposure to litigation. In fact, Cliniflow purportedly held majority ownership in the same primary portfolio company as other Downing entities and was simply a new name used by WAGNER and Lawrence to solicit investments from new employee-investors that was not tainted by the lawsuits filed against Downing entities. A majority of the over $1.5 million raised by WAGNER and Lawrence through Cliniflow was transferred to other Downing entities and used to pay for, among other things, WAGNER’s personal expenses and the repayment of prior investors.
Finally, in or about January 2017, WAGNER obtained a $400,000 loan and $100,000 grant from the Connecticut Department of Economic and Community Development (“CTDECD”) for Cliniflow on the basis of materially false statements made by WAGNER to the CTDECD. WAGNER transferred a majority of the funds obtained from the State of Connecticut, which were required to be used for Cliniflow’s purported relocation from New York to Connecticut, to other Downing entities and also used a portion of the funds to purchase a luxury car for his daughter.
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WAGNER, 54, of East Greenwich, Rhode Island, pled guilty to two counts of securities fraud and one count of wire fraud, each of which carries a maximum sentence of 20 years in prison. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. As part of the plea agreement with the Government, Wagner agreed to forfeit $549,000 in United States currency and pay restitution of $7,850,000 to victims of his criminal conduct.
WAGNER will be sentenced by Judge Hellerstein on January 11, 2021, at 11:00 a.m.
The case against co-defendant Marc Lawrence is still pending[1].
Ms. Strauss praised the work of the Federal Bureau of Investigation, and thanked the U.S. Securities and Exchange Commission and the Enforcement Section of the Massachusetts Securities Division for their assistance.
This case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Jilan J. Kamal and Sagar K. Ravi are in charge of the prosecution.
[1] The charges against Marc Lawrence contained in the Indictment are merely accusations, and he is presumed innocent unless and until proven guilty.
Camaroon Man Pleads Guilty to Defrauding Bourbonnais BankRead the Press Release
PEORIA, Ill. – A citizen of Cameroon, Lovette Namatinga, 33, entered pleas of guilty this morning to defrauding a Bourbonnais, Ill., bank. Namatinga pleaded guilty to all counts of the indictment immediately prior to jury selection as his trial was about to begin in Peoria, Ill., before U.S. District Judge James E. Shadid. Sentencing for Namatinga has been scheduled on Jan. 7, 2021.
Namatinga, of Owings Mills, Md., has remained in the custody of the U.S. Marshals Service since he was arrested on Oct. 7, 2019, at Washington Dulles International Airport by FDIC Office of Inspector General agents.
Today, Namatinga pleaded guilty to defrauding Municipal Trust and Savings Bank, Bourbonnais, Ill. Namatinga admitted that he carried out the fraud from about February to April 2019, by falsely representing to the bank that the secretary of one of the bank’s customers requested that cashier’s checks be sent to Namatinga’s fraudulent company known as Keiko San Products Alimenticious, LLC. Namatinga is the registered agent for Keiko, and the four checks were mailed to his home address. Once the checks were deposited into Keiko bank accounts, Namatinga then transferred money from those accounts to his personal account or withdrew cash from those accounts. The loss to the bank was approximately $140,000.
In addition to the fraud committed through Municipal Trust & Savings Bank, Namatinga used his fraudulent business and multiple associated bank accounts to deposit and launder fraud proceeds from various other financial institutions throughout the United States.
For each offense of bank fraud (four counts) and wire fraud (four counts), the statutory penalty is up to 30 years in prison and a fine of up to $1,000,000.
The charges are the result of an investigation by the FDIC Office of Inspector General. Assistant U.S. Attorneys Eugene L. Miller and Keith Cook are representing the government in the prosecution.
California Executive Pleads Guilty in College Admissions CaseRead the Press Release
BOSTON – A California insurance and private equity executive pleaded guilty today in connection with using fraud and bribery to cheat on the ACT exam on behalf of his daughter.
Mark Hauser, 59, of Los Angeles, Calif., pleaded guilty to one count of conspiracy to commit mail fraud and honest services mail fraud. U.S. Senior District Court Judge Douglas P. Woodlock scheduled sentencing for Jan. 21, 2021.
According to the terms of Hauser’s plea agreement, the government will recommend a sentence of six months in prison, one year of supervised release, a fine of $40,000 and restitution.
Hauser agreed with William “Rick” Singer to pay an amount, ultimately totaling $40,000, to facilitate cheating on his daughter’s ACT exam. As part of the scheme, co-conspirator Mark Riddell traveled to Houston, Texas, where Hauser’s daughter took the exam and purported to proctor the test. Instead, Riddell corrected the answers on the exam after she completed it. Two days later, Singer paid an intermediary, Martin Fox, $25,000, with the understanding that Fox would pass part of the payment on to Niki Williams, the test site administrator who allowed the cheating to occur. Singer also paid Riddell $10,000 for his role in the scheme.
Singer, Riddell and Fox have previously pleaded guilty and are cooperating with the government’s investigation. Williams has agreed to plead guilty. The details contained in the court documents are allegations and the remaining defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Case information, including the status of each defendant, charging documents and plea agreements are available here: https://www.justice.gov/usao-ma/investigations-college-admissions-and-testing-bribery-scheme.
The charge of conspiracy to commit mail fraud and honest services mail fraud provides for a sentence of up to 20 years in prison, three years of supervised release and a fine of $250,000 or twice the gross gain or loss, whichever is greater. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Joleen Simpson, Acting Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston; and Mark Deckett, Resident Agent in Charge of the Department of Education, Office of Inspector General made the announcement today. Assistant U.S. Attorneys Eric S. Rosen, Justin D. O’Connell, Leslie A. Wright, Kristen A. Kearney, Stephen E. Frank and Karin M. Bell of Lelling’s Criminal Division are prosecuting the case.
Auto Body Shop Owner Pleads Guilty to Tax FraudRead the Press Release
BOSTON – The owner of Everett and Worcester auto body shops pleaded guilty today to a payroll tax scheme resulting in a tax loss to the IRS of more than $290,000.
Adam Haddad, 43, of Shrewsbury, pleaded guilty to three counts of aiding the preparation of false tax returns before U.S. District Court Judge Timothy S. Hillman, who scheduled sentencing for Jan. 13, 2021. Haddad was charged in August 2020.
For tax quarters ending in March 2015 through June 2017, Haddad paid a significant portion of the wages to employees of his company, Accurate Collision, Inc. “under the table.” In doing so, Haddad caused Accurate Collision, Inc. to file false returns with the IRS which underreported the actual wages he had paid his employees as well as the employment taxes due to the IRS. In total, Haddad caused a loss to the IRS of at least $292,231.
The charging statue provides for a sentence of up to three years in prison, one year of supervised release and a fine of $250,000 or twice the gross gain or loss, whichever is greater. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling and Joleen Simpson, Acting Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation made the announcement today. Assistant U.S. Attorney Sara Miron Bloom of Lelling’s Securities, Financial and Cyber Fraud Unit is prosecuting the case.
Auburn Man Sentenced for Making False Statements to FBI about His Involvement in Distributing ISIS PropagandaRead the Press Release
Montgomery, Alabama – On Thursday, September 17, 2020, Nayef Amjad Qashou, a 26-year-old man residing in Auburn, Alabama, was sentenced to 57 months in prison for making false statements to the FBI during a terrorism investigation, announced United States Attorney Louis V. Franklin, Sr. and FBI Special Agent in Charge James Jewell. There is no parole in the federal system.
According to court documents and statements made in open court, a few years prior to 2018, the FBI began to monitor Qashou after they received tips concerning some erratic behavior that indicated he might have an interest in joining ISIS (Islamic State of Iraq and Syria). Then, on September 26, 2018, Qashou was interviewed by agents and task force officers from the FBI who suspected that he was sharing videos supporting international terrorism. During the interview, Qashou admitted to compiling and distributing what he called "educational" videos relating to Islam. However, he told agents that he only compiled 37 videos and he misrepresented the nature and content of the videos. As the investigation continued, agents discovered that Qashou distributed some 115 videos to other individuals and that the videos consisted of ISIS propaganda. Ultimately, Qashou admitted he knowingly lied about the number and content of the videos in order to protect individuals depicted in them and to impede the investigation into his actions. It was also revealed during the sentencing hearing that Qashou had previously traveled to Jordan and attempted to cross into Syria to join ISIS, but he was prevented from doing so by Jordanian officials.
After completing his prison sentence, Qashou will serve three years of supervised release. During that time he will be subject to a number of special conditions imposed by the judge, to include participation in a mental health treatment program and monitoring of his computer and electronic device usage by the United States Probation Office.
The Federal Bureau of Investigation (FBI) investigated this case, with assistance from the Auburn Police Division. Assistant United States Attorneys Joshua Wendell and Robert Nichols prosecuted the case.
Antitrust Division Supports Modernizing Merger Filing Exemptions for Certain InvestmentsRead the Press Release
On Monday, September 21, Assistant Attorney General Makan Delrahim concurred in the Federal Trade Commission’s (FTC) Federal Register publication of a Notice of Proposed Rulemaking (NPRM) to revise the premerger notification rules (the Rules) that implement the Hart-Scott-Rodino Antitrust Improvements Act (HSR).
The NPRM proposes to create a new reporting exemption for certain de minimis investments of 10% or less. The proposed amendments in the NPRM also change the definition of “person,” and make explanatory and ministerial changes to the HSR Rules as well as the HSR Form and Instructions to effect the proposed amendments. In another Advance Notice of Proposed Rulemaking (ANPRM), also supported by the Antitrust Division, the FTC seeks to gather information, related to seven topics, that will help to determine the path for future amendments to the HSR Rules.
“One of my goals as Assistant Attorney General has been to right-size the HSR regime to better account for how the economy has changed in the decades since the HSR regime was first enacted, including changes in the investment landscape and investor behavior,” said Assistant Attorney General Delrahim. “I am pleased to be working with the FTC towards this goal. In particular, I have been an advocate for the creation of a new exemption for certain de minimis investments of 10% or less in order to address the regulatory burdens of an overbroad HSR requirement for certain minority investments that do not raise competition concerns.”
A comment period will follow publication in the Federal Register, and the Antitrust Division encourages all interested stakeholders to submit comments on both the NPRM and the ANPRM. The Antitrust Division is particularly interested in comments on the following features of the NPRM, which will greatly benefit both the Antitrust Division and the FTC as they work collaboratively towards a final rule:
- The Director/Officer Carve-Out: Should this carve-out be removed, given that the new exemption already has carve-outs for competitors and common ownership? How does it meaningfully increase the likelihood of receiving filings that have the potential to raise competition concerns?
- The Vendor/Vendee Carve-Out: Should this carve-out be removed? Does it meaningfully increase the likelihood of receiving filings that have the potential to raise competition concerns?
Albuquerque woman charged with drug trafficking and firearms possession in Operation Legend caseRead the Press Release
ALBUQUERQUE, N.M. – Jordan Wright, 31, of Albuquerque made an appearance on Sept. 18 in federal court where she was charged with possession of methamphetamine with intent to distribute and possession of a firearm in relation to a drug trafficking crime. A detention hearing is scheduled for Sept. 22.
According to a criminal complaint, on Aug. 19, Wright allegedly coordinated arrangements by cellphone calls and text messages to sell two ounces of methamphetamine. She also allegedly provided her backpack and a handgun as collateral during the transaction. At the time of her arrest, she allegedly possessed two baggies containing methamphetamine
A criminal complaint is only an accusation. A defendant is presumed innocent unless and until proven guilty.
The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated this case. Assistant U.S. Attorney Samuel A. Hurtado is prosecuting the case as part of the Department of Justice's Operation Legend, a coordinated federal and local law enforcement initiative to fight gun and dangerous crime.
20 September 2020
“SCO” Gang Member Sentenced on Drug Trafficking ChargesRead the Press Release
PITTSBURGH, PA - A former resident of Braddock, Pennsylvania, has been sentenced in federal court to nine years’ imprisonment and four years supervised release on his conviction of narcotics trafficking, United States Attorney Scott W. Brady announced today.
Senior United States District Judge Arthur J. Schwab imposed the sentence on Jaymare Jackson, age 30.
According to information presented to the court, the Greater Pittsburgh Safe Streets Task Force conducted a long-term investigation of drug trafficking occurring in and around the Braddock section of Pittsburgh. Jackson and other individuals were identified as members and/or associates of a neighborhood based street gang, self-titled "SCO", which illegally distributed controlled substances in the Greater Pittsburgh Region..
In January of 2019, investigators obtained authorization to conduct a federal wire investigation, which continued through May of 2019. Jackson, along with 33 others were indicted in June of 2019 by a federal grand jury in three separate, but related, Indictments.
The Court was informed that Jackson is a member of SCO and, based upon intercepted communications occurring over telephones that were intercepted, law enforcement confirmed that Jackson was a heroin and cocaine base distributor. The Court was also advised that on June 12, 2019, Jackson illegally possessed two firearms as well as items used to package and distribute controlled substances. Mr. Jackson acknowledged that he knew, at that time, that he could not possess the firearms after having been previously convicted of carrying a firearm without a license. Federal law prohibits anyone who has previously been convicted of a crime punishable by a term of imprisonment exceeding one year, to possess a firearm or ammunition.
Assistant United States Attorney Rebecca L. Silinski prosecuted this case on behalf of the government.
United States Attorney Brady commended the multi-agency team, which was led by the Federal Bureau of Investigation, for the investigation leading to the successful prosecution of Jackson. Partners in this investigation included the Drug Enforcement Administration, Bureau of Alcohol Tobacco Firearms and Explosives, United States Marshals Fugitive Task Force, Allegheny County Sheriff’s Office, Allegheny County Police Department, Pennsylvania State Police, Pennsylvania Attorney General’s Office Bureau of Narcotics, and the Pittsburgh Bureau of Police.
Other assisting agencies included the Monroeville Police Department, Penn Hills Police Department, Wilkinsburg Police Department, and Allegheny County Adult Probation.
This case is part of the Organized Crime Drug Enforcement Task Force program, known as OCDETF. OCDETF was established in 1982 to support comprehensive investigations and prosecutions of major drug trafficking and money laundering organizations. It is the keystone of the drug reduction strategy of the Department of Justice. By combining the resources and expertise of federal agencies and their state and local law enforcement partners, OCDETF identifies, disrupts, and dismantles the most serious drug trafficking, money laundering, and transnational criminal organizations.
MEDIA ADVISORY: United States Attorney Mike Stuart to Hold Press Conference in Beckley TomorrowRead the Press Release
CHARLESTON, W.Va. – United States Attorney Mike Stuart will hold a press conference in Beckley on Monday, September 21, 2020 at approximately 12:00 p.m. to discuss developments in the case of United States v. Natalie Cochran.
Where: Robert C. Byrd U.S. Courthouse and Federal Building
110 North Heber Street
Beckley, WV
When: Monday, September 21, 2020 @ approximately 12:00 p.m.
Follow us on Twitter: SDWVNews and USAttyStuart
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19 September 2020
Statement by U.S. Attorney Jason Dunn Regarding Death of Supreme Court Justice Ruth Bader GinsburgRead the Press Release
“Along with the entire US Attorney’s Office for the District of Colorado, I am saddened by the loss of Justice Ginsburg. She was a dedicated jurist who believed deeply in the constitutional principles she defended, including equality for all people. When I think of the truly outstanding attorneys who work in my office, I cannot help but believe that many chose legal careers due at least in part to the groundbreaking career and advocacy of Justice Ginsburg. And for that, I am indeed grateful.”
Man from Oglala, South Dakota, Charged with Involuntary ManslaughterRead the Press Release
United States Attorney Ron Parsons announced that an Oglala, South Dakota, man has been indicted by a federal grand jury for Involuntary Manslaughter.
Clifford Running Hawk, age 44, appeared before U.S. Magistrate Judge Daneta Wollmann on September 11, 2020, and pleaded not guilty to the Indictment.
The maximum penalty upon conviction is 8 years in a federal prison, and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
Running Hawk is alleged to have operated a motor vehicle in a negligent manner, including driving while under the influence of alcohol and speeding, which caused a crash with an oncoming vehicle. One of the passengers in that vehicle died from the injuries she sustained in the crash.
The charge is merely an accusation and Running Hawk is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Oglala Sioux Tribe Department of Public Safety and the Federal Bureau of Investigation. Assistant U.S. Attorney Heather Sazama is prosecuting the case.
Running Hawk was released on bond pending trail. A trial date has been set for November 17, 2020.
Bullhead Man Indicted on Assault ChargesRead the Press Release
United States Attorney Ron Parsons announced that a Bullhead, South Dakota, man has been indicted by a federal grand jury for Assault With a Dangerous Weapon and Assault Resulting In Serious Bodily Injury.
Leland Brown, age 44, was indicted on September 9, 2020. He appeared before U.S. Magistrate Judge Mark A. Moreno on September 18, 2020, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in federal prison and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on April 20, 2020, Brown assaulted an individual with shod feet with the intent to do bodily harm and the assault resulted in serious bodily injury.
The charges are merely accusations and Brown is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Standing Rock Sioux Tribe Bureau of Indian Affairs Law Enforcement Services. Assistant U.S. Attorney Kirsten E. Jasper is prosecuting the case.
Brown was released on bond pending trial. A trial date has not been set.
18 September 2020
Winchester Man Pleads Guilty to Making False Statements During Acquisition of a FirearmRead the Press Release
CONCORD - Tyrone Morris-Janey, 30, of Winchester, pleaded guilty in federal court to making false statements during the acquisition of a firearm, United States Attorney Scott W. Murray announced today.
According to court documents and statements made in court, ATF and Boston Police Department personnel recovered a Ruger model LCP, .380 caliber pistol with an obliterated serial number. The BPD crime laboratory was able to recover the serial number and ATF traced the firearm to Morris Janey. A further investigation revealed that from January 8, 2019, through July 31, 2019, Morris Janey purchased six firearms. During the purchases of the firearms, Morris Janey claimed that he was the actual purchaser of the firearms which was not true. He later admitted that he purchased the firearms for another person. In addition, during the purchase of three of the firearms, Morris Janey falsely claimed he lived at a New Hampshire address.
Morris-Janey is scheduled to be sentenced on January 24, 2021.
“Lying to obtain firearms is a federal crime,” said U.S. Attorney Murray. “Criminal actors often have others purchase guns for them because they cannot lawfully purchase the guns themselves. In order to maintain public safety, we will not hesitate to bring federal charges against those who make false statements in order to buy guns.”
“Firearms trafficking continues to be a top priority for ATF and our law enforcement partners. ATF is committed to identifying and disrupting the sources of illegal firearms which jeopardize the safety of our communities,” said Kelly D. Brady, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives.
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, with assistance from the Boston Police Department. The case is being prosecuted by Assistant U.S. Attorney Debra Walsh.
The case is part of ATF’s Project Safe Neighborhoods initiative, which is a federally-funded program intended to reduce gun violence through law enforcement training, public education, and aggressive law enforcement efforts to investigate and prosecute gun-related crimes.
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Watervliet Man Sentenced to 15 Years for Sexually Exploiting a ChildRead the Press Release
ALBANY, NEW YORK – Aaron Vroman, age 30, of Watervliet, New York, was sentenced today to 180 months in prison for sexually exploiting a child.
The announcement was made by Acting United States Attorney Antoinette T. Bacon and Kevin Kelly, Special Agent in Charge of the Buffalo Field Office of Homeland Security Investigations (HSI).
In pleading guilty, Vroman admitted that, on at least four occasions, he secretly video-recorded a minor using the bathroom for the purposes of obtaining sexually explicit images of the victim’s genitals. Vroman also admitted that he touched that same victim’s genital area over the victim’s underwear while the victim was sleeping and that he video-recorded that conduct. Vroman also possessed images of child pornography on his laptop computer that did not involve the victim and that he obtained via the internet, including videos depicting the sexual abuse and exploitation of pre-pubescent girls.
Senior United States District Judge Norman A. Mordue also imposed a 25-year term of supervised release, which will start after Vroman is released from prison. As a result of his conviction, Vroman will be required to register as a sex offender upon his release from prison.
Vroman’s case was investigated by HSI, with assistance from the New York State Police and the Colonie Police Department. This case was prosecuted by Assistant U.S. Attorneys Geoffrey J. L. Brown and Michael D. Gadarian.
This case was prosecuted as part of Project Safe Childhood. Launched in May 2006 by the Department of Justice, Project Safe Childhood is led by United States Attorney’s offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS). Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit https://www.justice.gov/psc.
Waterbury Man Sentenced to More Than 6 Years in Prison for Distributing Fentanyl and HeroinRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that TYRELL CAMPBELL, also known as “Bricks,” 30, of Waterbury, was sentenced today by U.S. District Judge Janet C. Hall in New Haven to 78 months of imprisonment, followed by three years of supervised release, for distributing fentanyl and heroin.
According to court documents and statements made in court, this matter stems from a joint investigation headed by the DEA New Haven Task Force and the Waterbury and Naugatuck Police Departments into a heroin and cocaine trafficking operation headed by Keith Jordan of Waterbury. The investigation, which included the use of court-authorized wiretaps, physical surveillance and controlled purchases of narcotics, revealed that Jordan was receiving large quantities of heroin from various suppliers and selling to drug to other distributors, including Campbell, and street-level customers. Jordan also purchased and distributed cocaine.
On March 13, 2019, a grand jury in Hartford returned an indictment charging Campbell, Jordan and 27 other individuals with various offenses related to the distribution of heroin, fentanyl, cocaine and crack cocaine.
Campbell and several of his codefendants were arrested on March 20, 2019. In association with the arrests, investigators seized approximately 3,000 bags of heroin, 400 grams of cocaine, 350 grams of fentanyl/heroin mixed, 400 grams of heroin, 10 grams of crack, 20 pounds of marijuana, fentanyl patches, a one-kilogram press, four handguns, approximately $120,000 in cash and four vehicles.
Investigators seized from Campbell approximately 10 grams of a mixture of fentanyl and heroin, and $6,765 in cash, when he was arrested.
Campbell’s criminal history includes felony convictions for narcotics offenses, and he was on state probation while engaged in the criminal conduct that led to the federal charges. In October 2018, he was arrested by Waterbury Police for criminal possession of a handgun.
Campbell has been detained since March 20, 2019. On October 15, 2019, he pleaded guilty to one count of conspiracy to distribute, and to possess with intent to distribute, heroin.
Jordan pleaded guilty and awaits sentencing.
This investigation has been conducted by the Drug Enforcement Administration New Haven Task Force, Waterbury Police Department and Naugatuck Police Department, with the critical assistance of the U.S. Secret Service, New York Field Office. The DEA New Haven Task Force includes participants from the U.S. Marshals Service, Internal Revenue Service – Criminal Investigation Division, and the New Haven, Hamden, West Haven, North Haven, Branford, Ansonia, Meriden, Derby, Middletown, Naugatuck and Waterbury Police Departments.
The case is being prosecuted by Assistant U.S. Attorneys S. Dave Vatti and Nathaniel J. Gentile.
Waterbury Man Sentenced to 5 Years in Prison for Role in Cocaine Trafficking ConspiracyRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that JOEVANNY VICENTE, 34, of Waterbury, was sentenced today by U.S. District Judge Stefan R. Underhill in Bridgeport to 60 months of imprisonment, followed by four years of supervised release for his role in a cocaine trafficking conspiracy.
According to court documents and statements made in court, a DEA Task Force investigation identified Vicente as a broker of kilogram-quantity cocaine transactions. Vicente was arrested on September 10, 2018, after he delivered two kilograms of cocaine to another individual in Waterbury.
On November 13, 2018, after an indictment was returned in this case, Vicente was released on a $100,000 bond. The appearance bond was co-signed by two individuals and secured by a residential property Vicente owned on York Street in Waterbury. Vicente subsequently fled to the Dominican Republic. He was arrested on March 5, 2019, in Puerto Rico after he traveled there to visit his son.
On February 1, 2019, Judge Underhill ordered Vicente’s appearance bond and his York Street property forfeited.
Vicente has been detained since his arrest. On December 10, 2019, he pleaded guilty to one count of conspiracy to distribute, and to possess with intent to distribute, 500 grams or more of cocaine.
This matter is being investigated by the DEA Bridgeport High Intensity Drug Trafficking Area (HIDTA) Task Force. The case is being prosecuted by Assistant U.S. Attorneys Rahul Kale, Karen Peck and Christine Sciarrino.
Warwick Man Admits to Conspire to Fraudulently Obtain COVID-19 Stimulus LoansRead the Press Release
PROVIDENCE – A Warwick man today admitted to a federal court judge that he participated in a conspiracy with a Massachusetts man to submit fraudulent bank loan applications to a Rhode Island bank in an effort to obtain hundreds of thousands of dollars in forgivable loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, passed by Congress to assist businesses impacted by the pandemic.
David Andrew Butziger, 52, admitted that he conspired with David Adler Staveley, a/k/a Kurt David Sanborn, a/k/a David Sanborn, 53, of Andover, MA, to seek forgivable loans guaranteed by the SBA, claiming to have dozens of employees earning wages at four different business, three restaurants and an electronics business, when, in fact, there were no employees working for any of the businesses.
Butziger admitted that he submitted a loan application to BankNewport under the federal Paycheck Protection Program (PPP), part of the CARES Act passed by Congress on March 29,2000, on behalf of an unincorporated entity that he called Dock Wireless. The loan application was in the amount of $105,381.50 and fraudulently represented that Dock Wireless had 7 employees and an average monthly payroll of $42,152.60. According to the government, in truth and in fact, Dock Wireless had no employees and no wages were ever paid by Dock Wireless.
Butziger admitted that he conspired with Staveley who himself allegedly submitted three fraudulent bank loan applications for SBA loans under the PPP totaling $438,577. It is alleged that Staveley claimed the loans were to be used to pay employees at three restaurants he claimed to own and to be operating, including Top of the Bay and Remington House in Warwick and On The Trax in Berlin, MA.
An investigation determined that Remington House and On The Trax were not open for business prior to the start of the COVID-19 pandemic and at the time the loan applications were submitted, and that Staveley did not own or have any role in Top of the Bay restaurant.
Appearing today before U.S. District Court Judge Mary S. McElroy, Butziger pleaded guilty to conspiracy to commit bank fraud, announced United States Attorney Aaron L. Weisman, Special Agent in Charge Joseph R. Bonavolonta of the FBI’s Boston Field Office, and Acting Special Agent in Charge of Internal Revenue Service Criminal Investigation Joleen Simpson.
Butziger is scheduled to be sentenced on December 18, 2020.
A federal grand jury returned an indictment on September 2, 2020, charging Staveley with three counts of bank fraud and one count each of conspiracy to commit bank fraud, false statements to influence the SBA, aggravated identity theft, and failure to appear in court as required.
After having been having been charged by way of a federal criminal complaint in May 2020 for his alleged role in the conspiracy to gain four fraudulent SBA PPP loans, and while on pre-trial release, Staveley allegedly faked his own death and failed to appear in court, as ordered by the court. It is alleged that from May 26, 2020, to July 23, 2020, in an effort to avoid apprehension, Staveley traveled to various States using false identities and stolen license plates. He was apprehended by the United States Marshals Service in Alpharetta, Georgia on July 23, 2020.
Staveley is now detained in federal custody while awaiting trial.
A federal indictment and a criminal complaint are merely accusations. A defendant is presumed innocent unless and until proven guilty.
The cases are being prosecuted by Assistant U.S. Attorney Lee H. Vilker.
The Justice Department acknowledges and thanks the SBA Office of Inspector General and the FDIC, Office of Inspector General for their efforts investigating this mater.
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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Virginia Attorneys Sentenced for Attempting to Extort a Multinational Chemicals CompanyRead the Press Release
Two Virginia attorneys were sentenced today on federal extortion charges for their roles in a scheme to extort a multinational chemicals company by threatening to inflict substantial financial and reputational harm on the company if their demands for a $200 million payment disguised as a purported “consulting agreement” were not met.
Timothy Litzenburg, 38, of Charlottesville, Virginia, was sentenced to 24 months in prison followed by one year of supervised release by U.S. District Judge Norman K. Moon of the Western District of Virginia. Daniel Kincheloe, 41, of Glen Allen, Virginia, was separately sentenced to 12 months in prison followed by one year of supervised release by Judge Moon. Both defendants had previously pleaded guilty to one count of transmitting interstate communications with the intent to extort.
“These two attorneys flagrantly violated their ethical duties to their own clients as they sought to extort a company out of $200 million,” said Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division. “Attorneys who cross the line and abuse their status as officers of the court will be held accountable for their actions.”
“Today’s sentencing should serve as a strong notice to fraudsters that the U.S. Postal Inspection Service will pursue anyone who uses the mail for illegal schemes,” said Delany De Leon-Colon, Inspector in Charge at the U.S. Postal Inspection Service (USPIS) who oversees the Criminal Investigations Group. “Whether it’s a private citizen or a major corporation, Postal Inspectors will never relent in protecting them from those who seek to use the U.S. Mail to further their dangerous scams.”
Litzenburg and Kincheloe previously admitted that in approximately October 2019, Litzenburg approached a company (Company 1) and threatened to make public statements alleging that Company 1 had significant civil liability for manufacturing a purportedly harmful chemical used in a common household product used to kill weeds. Litzenburg and Kincheloe also admitted that after describing the possibility of damaging lawsuits against Company 1, Litzenburg proposed, in sum and substance, that he and Kincheloe enter into a “consulting arrangement” with Company 1 that would create a purported conflict-of-interest that would effectively stop them from representing their clients as plaintiffs in litigation against Company 1. Thereafter, Litzenburg and Kincheloe admitted that Litzenburg, with Kincheloe’s knowledge and agreement, demanded that Company 1 pay Litzenburg, Kincheloe, and others, a total of $200 million in purported “consulting fees.”
Litzenburg and Kincheloe also previously admitted that after making their demand for $200 million from Company 1, they registered a Virginia corporation for the purpose of receiving monies from Company 1, and that they agreed to split the funds from Company 1 amongst themselves and their associates, and to not distribute any of the monies Company 1 paid them as purported “consulting fees” to their existing clients. Litzenburg and Kincheloe admitted that after making their demand for $200 million, Litzenburg threatened Company 1 that they and others would commence litigation that would become “an ongoing and exponentially growing problem for [Company 1], particularly when the media inevitably takes notice” and that such litigation would cost Company 1 and its publicly-traded parent company “billions, setting aside the associated drop in stock price and reputation damage.”
Litzenburg and Kincheloe also admitted pursuant to their guilty pleas that in an email written by Litzenburg, they threatened Company 1 that unless they were paid $200 million, Company 1 would have “thousands of future plaintiffs against [Company 1]” and that “in the absence of a so-called ‘global’ or final deal with me, this will certainly balloon into an existential threat to [Company 1].”
Litzenburg and Kincheloe also admitted that they met in person with attorneys representing Company 1 at a conference center in Charlottesville, Virginia, and during that meeting Litzenburg again threatened to injure the property and reputation of Company 1 and its parent company unless they were paid $200 million pursuant to purported “consulting arrangements,” and that without such a deal there was no way Company 1 “gets out of it for less” than “[a] billion. Yeah. No, I mean, nuisance value, uh, defense lawyer fees, a hit in the stock when this gets filed and served, maybe the press conference, whatever.” Later in the same meeting, Litzenburg and Kincheloe admitted that Litzenburg again stated, in sum and in part, that if they commenced litigation it would have adverse effects on Company 1’s parent’s stock price, which Litzenburg described as “a 40 percent stock loss coming off the top.”
Litzenburg also admitted that, during other communications with Company 1, he told Company 1 that if he received the $200 million in “consulting fees” he would not discuss Company 1 or its parent company with his current clients, and that he was willing to “take a dive” during a deposition of a toxicology expert to deter potential future claims related to litigation against Company 1.
The USPIS investigated the case. Principal Assistant Chief Henry P. Van Dyck and Assistant Chief L. Rush Atkinson of the Criminal Division’s Fraud Section are prosecuting the case.
The Criminal Division’s Fraud Section plays a pivotal role in the Department of Justice’s fight against white collar crime around the country.
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.
Valdosta Couple Indicted on Child Pornography Production Charges, Law Enforcement Open Hotlines for Concerned CitizensRead the Press Release
VALDOSTA, Ga. – Law enforcement agencies investigating a Valdosta couple criminally indicted this week for a multitude of child pornography production charges have opened two hotlines for concerned citizens to report potential crimes, said Charles “Charlie” Peeler, the United States Attorney for the Middle District of Georgia.
Jayson E. Wright, 34, and Kara E. Wright, 31, both of Valdosta, were indicted by a federal grand jury in Macon on Wednesday, September 16. Jayson Wright is charged with six counts of production of child pornography; Kara Wright is charged with three counts of production of child pornography. The defendants were originally arrested on state warrants from Lowndes County, Georgia, followed by a federal criminal complaint filed in the Middle District of Georgia. They are in the custody of the U.S. Marshals, and were arraigned before the Honorable Jason B. Libby in the Southern District of Texas on September 17, 2020, case number 720-cr-33(WLS). The defendants waived their identity hearing and reserved their detention hearing upon their return to Georgia. The defendants remain in the custody of the U.S. Marshals, and it is unknown at this time when they will be transferred to Georgia. An indictment is only an allegation of criminal conduct, and all of the defendants are presumed innocent until and unless proven guilty in a court of law beyond a reasonable doubt.
The indictment alleges that the defendants enticed four minor children to engage in sexually explicit acts which were filmed or photographed. Information gathered during the investigation alleges that both defendants were possibly involved in the Valdosta-area Boy Scouts of America from August 2015 until the present time. Additional information gathered during the investigation alleges that Kara Wright was possibly an Assistant Scout Master. Parents and guardians of children involved in Scouts under the alleged leadership of the Wrights, or whose children otherwise may have come into contact with Wrights, are encouraged to contact the following hotlines to share any concerns related to this investigation:
Homeland Security Investigations Tip Line: 866-DHS-2-ICE
Lowndes County Sheriff’s Office, Investigations Division: (229) 671-2950
“It is imperative that parents and guardians of children who may have been in contact with these individuals speak to their children, and reach out to investigators at Homeland Security or Lowndes County Sheriff’s Office with any concerns,” said U.S. Attorney Charlie Peeler. “We are thankful for the strong partnership we have with HSI and the Lowndes County Sheriff’s Office as we all work relentlessly to protect the safety of the children in the Middle District of Georgia.”
The case is being investigated by the Lowndes County Sheriff’s Office and Homeland Security Investigations (HSI). Assistant U.S. Attorney Katelyn Semales is prosecuting the case for the Government. Questions can be directed to Pamela Lightsey, Public Information Officer, United States Attorney’s Office, at (478) 621-2603 or Melissa Hodges, Public Affairs Director (Contractor), United States Attorney’s Office, at (478) 765-2362.
U.S. Attorney McAllister Statement on Justice GinsburgRead the Press Release
KANSAS CITY, KAN. – U.S. Attorney Stephen McAllister made the following statement on the passing of Supreme Court Justice Ruth Bader Ginsburg.
“Justice Ginsburg joined the Court after I was a law clerk. That said, she replaced my first Justice, Byron R. White, after he retired in 1993. She visited the KU Law School while I was Dean, and I had the pleasure of co-teaching a summer study abroad course with her in Istanbul, Turkey, a course that focused on equal protection law, her particular passion. She and her husband, Marty, were a delight in that summer program. Every one of my nine oral arguments before the Supreme Court included Justice Ginsburg, who often had pointed questions for me, but who also made a point of referring to me as “General McAllister” when I appeared for Kansas in my role as Solicitor General. She was fastidious in both her respect for advocates and her preparation for oral arguments.
“Physically tiny, the Justice was in so many ways a giant. No one who is objectively and intellectually honest can deny that claim. I firmly believe my mentor Justice Thomas would agree with my assertion, as would have her dear friend Justice Scalia.
“Irrespective of jurisprudential or philosophical views, I had the utmost respect for Justice Ginsburg as a person. I, my wife who soon will become an elected state prosecutor, and our four daughters, are profoundly grateful to RBG for forever changing for the better the legal landscape for American women and equal rights, allowing them to seek opportunities, achieve their goals, and excel on equal footing with men across the entire spectrum of American economy and its variety of professions and pursuits.”
U.S. Attorney Announces the Indictment of 17 Gun Offenders as Part of the Justice Department's “Project Guardian” InitiativeRead the Press Release
CHARLOTTE, N.C. – Andrew Murray, U.S. Attorney for the Western District of North Carolina, announced today the return of federal indictments against 17 individuals charged with federal firearms violations.
The indictments are the result of Project Guardian, the Justice Department’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by Attorney General William P. Barr in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence, and enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes. The initiative also improves information sharing, and ensures that federal resources are directed at the criminals posing the greatest threat to our communities.
“Gun violence remains a pervasive problem in communities across this district and our nation,” said U.S. Attorney Murray. “The indictments announced today are a testament to our ongoing coordination with our federal, state and local law enforcement partners and state prosecutors, and our shared commitment to reduce gun violence, remove firearms from the hands of felons, and bring to justice those who violate gun laws.”
“ATF has a long-standing commitment with our law enforcement partners to tackle gun violence and violent crimes in our communities,” said Vince Pallozzi, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives. “Removing violent criminals from our neighborhoods and recovering the firearms used in their crimes is a critical step toward stronger and safer neighborhoods.”
“We see every day how gun violence can cause heartache and destroy lives. Thanks to our partner agencies, the work done here is a step in the right direction to making communities safer and holding individuals accountable for their actions,” said Robert Schurmeier, Director of the North Carolina State Bureau of Investigation.
"Catawba County is a safer place today thanks to the incredible success of our local, state and federal partnership. The collaboration and teamwork demonstrated in this operation is some of the finest I have witnessed. I'm proud to have my office associated with these law enforcement professionals," said Sheriff Don Brown, of the Catawba County Sheriff’s Office.
“There is no doubt that these arrests will make our communities safer,” said Chief Thurman Whisnant of the Hickory Police Department. In Hickory, we very much appreciate the continued collaboration and cooperation among our local, state and federal law enforcement and prosecutors who are all committed to pursuing violent offenders that put our communities at risk.”
“The Long View Police department has a solid relationship with our federal, state, and local law enforcement partners. We are committed to disrupting criminal activity and keeping our communities safe. I am extremely proud of the law enforcement partnership and the outcome of this operation,” said Chief T.J. Bates of the Long View Police Department.
The 17 individuals indicted for firearms violations are:
- Trevin Ali Brown, 22, of Hickory, N.C.
- Chaetez Sean Clayton, 30, of Hickory, N.C.
- Shawn Malcolm Davis, 30, of Catawba, N.C.
- Donte Rassan Gore, 28, Hickory, NC.
- Daquan Lashawn Ikard, 30, of Hickory, N.C.
- Martavious Steven Isbell, 26, of Granite Falls, N.C.
- Gevon Marquise King, 36, of Hickory, N.C.
- Line Germaine Linebarger, 33, of Hickory, N.C.
- Robbie Octavion Little, 28, of Hickory, N.C.
- Curese Devin McIlwain, 35, of Hickory, N.C.
- Stanley Earl Reed, 29, of Hickory, N.C.
- Meguel Greylen Robinson, 25, of Hickory, N.C.
- Craig Anthony Ruff, 25, of Newton, N.C.
- Nicholas Anthony Santellan, 37, of Hickory, N.C.
- Michael Dwane Williams, 23, or Hickory, N.C.
- Wilburn Johnathan Wilson, 25, of Hickory, N.C.
- Tou Yang, 38, of Hickory, N.C.
As a result of the initiative, law enforcement have recovered more than 100 firearms, some o which were stolen, unregistered, or used in the commission of other violent crimes, ammunition, and a silencer, among other items. The defendants had their first court appearance in federal court in Charlotte today. Davis, Gore, McIlwain Robinson, Santellan, Wilson and Yang are also facing drug trafficking charges.
The charges in the indictments are allegations. The defendants are presumed innocent until proven guilty beyond reasonable doubt in a court of law.
In making today’s announcement, U.S. Attorney Murray thanked Scott Reilly, District Attorney for Caldwell, Burke and Catawba Counties. “Our partnership and collaboration with state prosecutors is a vital factor in the success of federal crime reduction initiatives like Project Guardian. I want to thank District Attorney Reilly for his office’s continued assistance and coordination with the U.S. Attorney’s Office, and I look forward to our continued joint efforts to increase safety in our communities,” said U.S. Attorney Murray.
The United States Attorney’s Office is prosecuting these cases with support from the following Project Guardian partners: the ATF, the SBI, the Catawba County Sheriff’s Office, the Hickory Police Department, and the Long View Police Department. The U.S. Secret Service, the FBI, the U.S. Marshals Service, and the Burke County Sheriff’s Office also assisted with the arrests.
Assistant U.S. Attorneys Lambert Guinn, Christopher Hess and Sanjeev Bhasker, of the U.S. Attorney’s Office in Charlotte, are handling the prosecutions.
For more information about Project Guardian, please visit: https://www.justice.gov/projectguardian
U.S Department of Agriculture-Office of Inspector General and Justice Department Conduct Animal Welfare Criminal Investigations TrainingRead the Press Release
On Sept. 14 to 18, criminal investigators and attorneys from the U.S. Department of Agriculture’s Office of Inspector General (USDA-OIG) and the U.S. Justice Department’s Environment and Natural Resources Division (ENRD) collaborated to put on a week-long training for USDA-OIG criminal investigators, as well as other federal law enforcement agencies on animal welfare criminal investigations and prosecutions.
“Animal fighting and other violations of federal animal welfare laws are serious offenses, and ending these cruel practices requires close partnerships among federal law enforcement agencies,” said ENRD Principal Deputy Assistant Attorney General Jonathan Brightbill. “Our division is proud to be a leader in this worthy cause. Our work with the U.S. Department of Agriculture to investigate and prosecute these cases sends a strong message that those who engage in such illegal and cruel practices will be punished.”
“The USDA Office of Inspector General has consistently and successfully conducted investigations of animal fighting and welfare, and has a proven record of building strong partnerships with other law enforcement officials and nongovernmental organizations to help protect animals,” said USDA-OIG’s Acting Assistant Inspector General for Investigations Peter P. Paradis Sr. “Partnering with the Justice Department to train our special agents ensures that we continue to attain optimal results for our efforts.”
“This in-depth training workshop is critical to the enforcement of our national animal laws,” said Professor David Favre of Michigan State University’s College of Law, and founder of its Animal Legal and Historical Center. “In this ever-evolving world of animal law enforcement, there are always lessons to be learned and experiences to share.”
During the training, special agents with USDA OIG’s Office of Investigations and nine attorneys from ENRD, including Principal Deputy Assistant Attorney General Brightbill, joined by state law enforcement officials, experts from academia, and nongovernmental organizations, shared their expertise with attendees. Instructors provided participants with an overview of the business of dogfighting and cockfighting, horse soring, overviews of federal animal welfare and cruelty statutes, effective investigative techniques, evidence collection best practices, available resources and authorities for the seizure and post-seizure care of animals, and successful sentencing strategies. The training also included a session on biohazards and zoonotics.
The Federal Animal Welfare Act makes it a felony punishable by up to five years in prison to knowingly sell, buy, possess, train, transport, deliver, or receive any animal, including dogs, for purposes of having the animal participate in an animal fighting venture. In 2014, the Justice Department designated ENRD as having concurrent responsibility, with the U.S. Attorney’s Offices, to enforce Federal animal cruelty laws.
The Department of Justice and USDA-OIG have had a number of successes in combating animal cruelty. For example, Operation Grand Champion brought 12 individuals to justice for their roles in a dog fighting ring. The operation began with a tip from a U.S. Drug Enforcement Administration agent surveilling drug crimes, and, from this tip, USDA-OIG investigators, working with the Department of Homeland Security and the FBI, uncovered a ring that crossed multiple states and involved hundreds of dogs. The prosecutions, conducted by ENRD and U.S. Attorney’s Offices between 2017 and 2019, resulted in convictions of 12 defendants in four federal districts, who were sentenced to 315 months in prison, combined. As a result of the investigation, 113 dogs were rescued and either surrendered or forfeited to the government.
The Justice Department has a robust and cross-cutting program to ensure effective enforcement of animal welfare law. This includes a civil forfeiture process that often results in animals being removed from accused abusers more quickly, along with the needed care, medical treatment, and the best chance for recovery and adoption. More than 1,200 dogs have been seized and rescued through this process. In addition, the Justice Department has provided extensive training for federal, state, and local law enforcement; identified and successfully advocated for policy changes that improve enforcement; and convened state and local law enforcement, animal protection organizations, and academic institutions to coordinate efforts in this area.
For more information on the department's efforts, visit our website at: https://www.justice.gov/enrd/animal-welfare.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Two Individuals Charged with Bribery Related to Iraq ContractsRead the Press Release
WASHINGTON –Two individuals have been charged with bribery offenses in connection with Department of Defense contracts as part of the Fraud Section’s ongoing efforts to combat corruption and fraud in contracting on U.S. military installations overseas.
Mark Alan Fryday, 37, and Lara Jumaah Mohammed, 30, both residing in Erbil, Iraq, were charged in an indictment filed in the District of Columbia with one count of conspiracy and one count of bribery of a public official.
“This alleged bribery and kickback scheme sought to undermine the efforts of the Department of Defense to lawfully contract overseas,” said Acting Assistant Attorney General Brian C. Rabbitt. “Corruption undermines our military’s readiness and affects the wellbeing of our servicemembers, and the Department of Justice will continue to work to protect our men and women in uniform from corrupt and fraudulent conduct around the world.”
“This office is committed to protecting the integrity of government contracting and in particular stamping out corruption that threatens the U.S. military and its installations abroad,” said Acting U.S. Attorney Michael Sherwin of the District of Columbia. “This indictment, and our partnership with the Fraud Section on this case, is part of that effort.”
“Contractors who do business with the Department of Defense should take notice of these investigations. This type of egregious conduct will not be tolerated” said Stanley Newell, Special Agent in Charge for the Defense Criminal Investigative Service (DCIS), Transnational Operations Field Office. “DCIS and its law enforcement partners remain steadfast in our commitment to defend the integrity of the Department of Defense contracting process by rooting out fraud and deceit of this sort, and ensuring that the perpetrators are held accountable.”
“We are committed to maintaining the integrity of the procurement process,” said Director Frank Robey of the U.S. Criminal Investigation Command’s (CID) Major Procurement Fraud Unit. “This indictment sends an unmistakable message to other companies around the world – that we will be relentless in rooting out corruption at any level.”
The indictment alleges that Fryday and Mohammed offered bribes to a U.S. Army official at Erbil Air Base in Iraq. Fryday and Mohammed allegedly owned companies based in Erbil that sought contracts to supply goods and services to U.S. military forces there. In early 2020, Fryday and Mohammed allegedly offered to pay an Army contracting official a kickback equivalent to 20 percent of the value of any contract that he awarded to their companies. Fryday and Mohammed also allegedly offered an upfront cash payment in exchange for the award of a contract to supply equipment that was due to be awarded in late March 2020.
As part of the Fraud Section’s on-going efforts to combat corruption and fraud in contracting on U.S. military installations overseas, two additional individuals have been previously charged. Roy George Varkey, 56, of Kuwait City, Kuwait, was charged with two counts of bribery in an indictment filed in the District of Columbia on Dec. 19, 2019, for his role in offering bribes to an employee of the Defense Logistics Agency (DLA) at Camp Arifjan, a U.S. military facility in Kuwait, in late 2019. Xavier Fernando Monroy, the former Director of Operations of the U.S. Navy’s Military Sealift Command Office in Busan, Republic of Korea, was charged by complaint on May 20, 2020 in the District of Columbia for allegedly participating in a bribery conspiracy and lying to federal investigators.
An indictment or complaint is merely an accusation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The Criminal Division’s Fraud Section is the nation’s leading prosecuting authority for complex procurement fraud and corruption cases.
The investigation is being conducted by DCIS and the CID’s Major Procurement Fraud Unit. Trial Attorney Michael P. McCarthy of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Eric S. Nguyen of the U.S. Attorney’s Office for the District of Columbia are prosecuting the case.
Two Individuals Charged with Bribery Related to Iraq ContractsRead the Press Release
Two individuals have been charged with bribery offenses in connection with Department of Defense contracts as part of the Fraud Section’s ongoing efforts to combat corruption and fraud in contracting on U.S. military installations overseas.
Mark Alan Fryday, 37, and Lara Jumaah Mohammed, 30, both residing in Erbil, Iraq, were charged in an indictment filed in the District of Columbia with one count of conspiracy and one count of bribery of a public official.
“This alleged bribery and kickback scheme sought to undermine the efforts of the Department of Defense to lawfully contract overseas,” said Acting Assistant Attorney General Brian C. Rabbitt. “Corruption undermines our military’s readiness and affects the wellbeing of our servicemembers, and the Department of Justice will continue to work to protect our men and women in uniform from corrupt and fraudulent conduct around the world.”
“My office is committed to protecting the integrity of government contracting and in particular stamping out corruption that threatens the U.S. military and its installations abroad,” said Acting U.S. Attorney Michael Sherwin of the District of Columbia. “This indictment, and our partnership with the Fraud Section on this case, is part of that effort.”
“Contractors who do business with the Department of Defense should take notice of these investigations. This type of egregious conduct will not be tolerated” said Stanley Newell, Special Agent in Charge for the Defense Criminal Investigative Service (DCIS), Transnational Operations Field Office. “DCIS and its law enforcement partners remain steadfast in our commitment to defend the integrity of the Department of Defense contracting process by rooting out fraud and deceit of this sort, and ensuring that the perpetrators are held accountable.”
“We are committed to maintaining the integrity of the procurement process,” said Director Frank Robey of the U.S. Criminal Investigation Command’s (CID) Major Procurement Fraud Unit. “This indictment sends an unmistakable message to other companies around the world – that we will be relentless in rooting out corruption at any level.”
The indictment alleges that Fryday and Mohammed offered bribes to a U.S. Army official at Erbil Air Base in Iraq. Fryday and Mohammed allegedly owned companies based in Erbil that sought contracts to supply goods and services to U.S. military forces there. In early 2020, Fryday and Mohammed allegedly offered to pay an Army contracting official a kickback equivalent to 20 percent of the value of any contract that he awarded to their companies. Fryday and Mohammed also allegedly offered an upfront cash payment in exchange for the award of a contract to supply equipment that was due to be awarded in late March 2020.
As part of the Fraud Section’s on-going efforts to combat corruption and fraud in contracting on U.S. military installations overseas, two additional individuals have been previously charged. Roy George Varkey, 56, of Kuwait City, Kuwait, was charged with two counts of bribery in an indictment filed in the District of Columbia on Dec. 19, 2019, for his role in offering bribes to an employee of the Defense Logistics Agency (DLA) at Camp Arifjan, a U.S. military facility in Kuwait, in late 2019. Xavier Fernando Monroy, the former Director of Operations of the U.S. Navy’s Military Sealift Command Office in Busan, Republic of Korea, was charged by complaint on May 20, 2020 in the District of Columbia for allegedly participating in a bribery conspiracy and lying to federal investigators.
An indictment or complaint is merely an accusation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The Criminal Division’s Fraud Section is the nation’s leading prosecuting authority for complex procurement fraud and corruption cases.
The investigation is being conducted by DCIS and the CID’s Major Procurement Fraud Unit. Trial Attorney Michael P. McCarthy of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Eric S. Nguyen of the U.S. Attorney’s Office for the District of Columbia are prosecuting the 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.
Twin Brothers Accused of Kidnapping and Assaulting Victim Charged in Miami Federal CourtRead the Press Release
Miami, Fl. – Federal prosecutors have charged 23-year-old twin brothers Devon Cooke and Donavan Cooke, of Miami Gardens, with carjacking and kidnapping after they allegedly abducted and assaulted a man in an attempt to collect ransom money.
Ariana Fajardo Orshan, U.S. Attorney for the Southern District of Florida, and George L. Piro, Special Agent in Charge, FBI, Miami Field Office, made the announcement.
According to the criminal complaint affidavit unsealed today, the Cooke brothers’ victim drove to the twins’ home in Miami Gardens on September 15, 2020, to collect money. When the victim arrived, the Cooke brothers -- already on house arrest for murder and attempted murder charges -- are alleged to have assaulted the victim, snatched his car keys, and dragged him out of the car and into their house. According to the complaint, the brothers bound the victim to a chair, wrapping his arms and legs with duct tape. The complaint states that the brothers beat the victim, used a knife to cut his face and toes, and wrapped a dog leash around the victim’s neck, choking him to the point of unconsciousness.
The complaint also alleges that the Cooke brothers threatened to kill the victim if he did not come up with ransom money and that a witness heard the victim plead for his life. With one of the brothers alleged to have been holding a gun to the victim’s head, the victim made a phone call. He instructed the person who answered to collect cash, a Rolex, and other jewelry from the victim’s room, place it in a bag, and drive to a location the Cooke brothers selected. While that person did as the victim asked, an armed accomplice of the Cooke brothers arrived at the defendants’ home, loaded the victim into his car, and transported the victim to the exchange spot, according to the complaint. Once there, the victim fled the car and the Cooke brothers’ accomplice drove off with the ransom.
An investigation led law enforcement officers to the Cooke twins. Inside their home, FBI agents found duct tape, a dog collar, ammunition, and other items.
The Cooke brothers are in federal custody. They made their initial appearance today in Miami federal court before U.S. Magistrate Judge Becerra, who detained them for a future hearing. Each brother faces up to 15 years in federal prison on the carjacking charge, and life in prison on the kidnapping charge.
FBI Miami and its FBI Miami Violent Crime Task Force investigated the case, in collaboration with the Miami Gardens Police Department. The case is being prosecuted by Assistant U.S. Attorney Dayron Silverio and Assistant U.S. Attorney Michael Gilfarb.
A criminal complaint contains allegations. A defendant is presumed innocent unless and until found guilty.
You may find related court documents and information on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov, under case no. 20-mj-03653.
Twenty-Eight Now Charged in Federal Probe into the Staging of Automobile AccidentsRead the Press Release
NEW ORLEANS, LOUISIANA – United States Attorney Peter G. Strasser announced today the indictment of nine additional defendants bringing the total to twenty-eight charged for intentionally staging automobile accidents. Today’s indictment charges CORNELIUS GARRISON (“GARRISON”), age 54, of New Orleans, Louisiana; DONIESHA GIBSON (“GIBSON”), age 29, of New Orleans, Louisiana; CHANDRIKA BROWN (“BROWN”), age 29, of Slidell, Louisiana; ISHAIS PRICE (“PRICE”), age 49, of New Orleans, Louisiana; AISHA THOMPSON (“THOMPSON”), age 42, of New Orleans, Louisiana; DEWAYNE COLEMAN (“COLEMAN”), age 21, of Marrero, Louisiana; DONISESHA LEE, age 30, of Harvey, Louisiana; DONREION LEE, age 22, of Harvey, Louisiana; and ERICA LEE THOMPSON (“ERICA LEE”), age 46, of Harvey, Louisiana. These nine defendants were charged in a seven-count federal indictment with one (1) count of Conspiracy to Commit Mail Fraud in violation of Title 18, United States Code, Section 371 and six (6) counts of Mail Fraud in violation of Title 18, United States Code, Section 1341. The indictment alleges that the defendants intentionally used vehicles to cause staged motor vehicle accidents with commercial carriers in order to defraud these carriers and their insurance companies. If convicted, the defendants face a maximum penalty of five (5) years for Count 1 and twenty (20) years as to Counts 2-7. Upon their release from prison, each defendant can be placed on a term of supervised release for up to five (5) years and fined up to $250,000.00 per count or twice the gross gain to the defendant of twice the gross loss to the victim.
According to today’s indictment and previous indictments, there were five (5) “slammers,” that is individuals who intentionally caused motor vehicle accidents to defraud commercial vehicles and insurance companies, operating in the New Orleans metropolitan area. Two alleged slammers, Damian Labeaud and Roderick Hickman, are charged in previous indictments, and, two additional alleged slammers have since died. Today’s indictment alleges that GARRISON was a slammer.
GARRISON is charged with staging over 50 accidents and was paid over $150,000 by an unnamed Co-Conspirator (“Co-Conspirator A”). Co-Conspirator A instructed GARRISON as to the number of passengers to use in the staged accidents and to avoid areas patrolled by the Louisiana State Police and instead stage the accidents under the jurisdiction of the New Orleans Police Department. The indictment alleges that Co-Conspirator A referred the staged accident cases to an attorney referenced as Attorney B. GARRISON staged accidents mostly on Interstate 10 from Slidell to Baton Rouge and usually at night to avoid eyewitnesses. GARRISON targeted commercial vehicles, including tractor-trailers, that were changing lanes and would cause the accident by striking the commercial vehicle or tractor-trailer in their blind spot, using the slammer vehicle. After the accident, GARRISION would usually exit the vehicle from the passenger side in order to avoid being seen by the driver of the target vehicle. GARRISON instructed the passengers to call 911 to report that they had been hit by a vehicle. A passenger in the vehicle would falsely claim to have been the driver at the time of the staged accident.
The instant indictment charges GARRISON with staging two accidents. The first occurred on October 15, 2015, and involved a Hotard bus. GARRISON intentionally drove a 2014 Dodge Avenger owned by GIBSON into a Hotard bus while traveling on the I-10 near the flyover of the I-510. Also in the vehicle were defendants BROWN and PRICE. Total settlement for the Hotard bus accident was approximately $677,500.
The second staged accident charged in this indictment occurred on September 6, 2017, on the I-10 near the Almonaster exit when GARRISON crashed defendant ERICA LEE’s 2015 RAV4 into a tractor-trailer owned by Averitt Express. The passengers in this vehicle were COLEMAN, DONISEHA LEE, DONREION LEE, and an unknown female passenger who gave the name Aisha Thompson to the police after the staged accident. Total settlement for the Averitt accident was $30,000.
In total, the victim trucking, bus, and insurance companies paid out approximately $707,500.00 for these two fraudulent claims.
An arrest warrant was issued for COLEMAN. The remaining defendants will be required to appear, at a later date, before a United States Magistrate Judge for an initial appearance and arraignment on this indictment.
U.S. Attorney Strasser reiterated that the indictment is merely a charge and that the guilt of the defendants must be proven beyond a reasonable doubt.
The U.S. Attorney’s Office would also like to acknowledge the assistance of the Federal Bureau of Investigation, Louisiana State Police, and the Metropolitan Crime Commission with this matter. The prosecution of this case is being handled by Assistant U.S. Attorney Brian M. Klebba, Supervisor of the Financial Crimes Unit; Assistant U.S. Attorney Edward Rivera; and Assistant U.S. Attorney Maria Carboni.
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Thief River Falls Man Pleads Guilty to Child Pornography ChargesRead the Press Release
United States Attorney Erica H. MacDonald today announced the guilty plea of BENJAMIN JOSEPH ROGGENBUCK, 38, to two counts of production and attempted production of child pornography. ROGGENBUCK, who was indicted on August 10, 2020, entered his plea on September 17, 2020, before Judge Nancy E. Brasel in U.S. District Court in St. Paul, Minnesota. ROGGENBUCK will be sentenced at a later date.
According to the defendant’s guilty plea, between November 2012 and February 2020, ROGGENBUCK used or attempted to use two prepubescent minor children to produce visual depictions of sexually explicit conduct. ROGGENBUCK also admitted to possessing and distributing pornography depicting prepubescent minors. As part of the plea agreement, ROGGENBUCK also pleaded guilty to first-degree criminal sexual conduct charges brought by the Pennington County Attorney’s Office.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorney’s Offices and the Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
This case is the result of an investigation conducted by the Pennington County Sheriff’s Office, the Minnesota Bureau of Criminal Apprehension, and Thief River Falls Police Department.
Assistant U.S. Attorneys Chelsea A. Walcker and Miranda E. Dugi are prosecuting the case.
Defendant Information:
BENJAMIN JOSEPH ROGGENBUCK, 38
Thief River Falls, Minn.
Convicted:
- Production and attempted production of child pornography, 2 counts
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Texas Woman Sentenced to over Nine Years in Prison for Trafficking over 3 Kilograms of MethamphetamineRead the Press Release
Gulfport, Miss – Courtney Lynell Johnson, 29, of Houston, Texas, was sentenced today by U.S. District Judge Sul Ozerden to 115 months in prison, followed by 5 years of supervised release, for possession with intent to distribute 500 grams or more of methamphetamine, announced U.S. Attorney Mike Hurst and Special Agent in Charge Brad Byerley with the Drug Enforcement Administration (DEA). Judge Ozerden also ordered Johnson to pay a $5,000 fine.
On October 21, 2019, a Harrison County Sheriff’s Deputy conducted a traffic stop on a vehicle driven by Johnson near the 45 mile marker of I-10 east bound. Upon questioning, Johnson stated that she was driving from Houston, Texas to pick up her sister in Gautier, Mississippi. A number of other incidents and factors made law enforcement suspicious, and the deputy subsequently asked Johnson for permission to search the vehicle. Johnson agreed and gave consent. A duffle bag, which Johnson claimed ownership of, was located in the trunk. A subsequent search of the bag’s contents revealed 100% pure methamphetamine (ICE) weighing 3,001.6 grams.
Johnson was arrested, advised of her Miranda rights, and agreed to answer questions. DEA agents learned that Johnson was transporting the methamphetamine from the Houston, Texas area to Gautier, Mississippi.
Johnson was charged in a federal criminal indictment and pled guilty before Judge Ozerden on February 28, 2020.
The case was investigated by the DEA and prosecuted by Assistant United States Attorney Shundral H. Cole.
Tennessee Man Sentenced to 23 Years in Prison for Production of Child Pornography Involving Arkansas MinorRead the Press Release
LITTLE ROCK—A Tennessee man was sentenced late Thursday on one count of production of child pornography. United States District Court Judge James M. Moody sentenced Craig Gillum, 55, of Shelbyville, Tennessee, to 280 months in federal prison. Cody Hiland, the United States Attorney for the Eastern District of Arkansas, and Diane Upchurch, Special Agent in Charge of the FBI Little Rock Field Office, announced the sentencing.
In January 2018, the parents of a 16-year-old female reported to authorities that she was missing from her home in Trumann, Arkansas. Officers identified the minor’s email and searched the account, which revealed sexually explicit messages from Gillum. In some of the emails, Gillum sent explicit photos of himself to the minor, and he requested and received images of child pornography from the “little girl,” as he referred to her in the messages.
On February 1, 2018, investigating agents learned the minor was located at a motel room in Nebraska with Gillum. Agents found the minor, whose hair had been cut and colored. The minor told investigators Gillum had picked her up in Trumann and driven her to Nebraska.
“This defendant manipulated a child into sending explicit images and then transported her out of the state to continue his depravity,” said U.S. Attorney Hiland. “Fortunately, he will spend the next 23 years in prison, where he cannot harm another child. We will seek the same lengthy sentence for anyone who seeks to take advantage of children in our communities.”
“Mr. Gillum’s despicable crimes separated an underage girl from her family and placed her in a repugnant situation,” said FBI Little Rock Special Agent in Charge Diane Upchurch. “Our agents work every day to counter evil in our state, which is why I’m so pleased they were able to apprehend Mr. Gillum and rescue his young victim. We urge anyone with information about child sexual abuse to contact the FBI immediately!”
On December 4, 2018, Gillum was charged in a three-count indictment with two counts of production of child pornography and one count of receipt of child pornography. The defendant pleaded guilty to one count of production of child pornography on August 1, 2019.
In addition to the prison term, Gillum was sentenced to ten years of supervised release following his imprisonment. The investigation was conducted by the FBI, and the case was prosecuted by Assistant United States Attorney Kristin Bryant.
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This news release, as well as additional information about the office of the
United States Attorney for the Eastern District of Arkansas, is available online at
https://www.justice.gov/edar
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Tennessee Doctors Sentenced in $65 Million TRICARE FraudRead the Press Release
Assistant U. S. Attorney Mark W. Pletcher (619) 546-9714
NEWS RELEASE SUMMARY – September 18, 2020
SAN DIEGO – Two doctors, Susan Vergot and Carl Lindblad, were sentenced in federal court today for participating in a health care fraud scheme that bilked TRICARE – the health care program that covers United States service members – out of tens of millions of dollars by prescribing thousands of exorbitantly expensive compounded drugs to patients they never saw or examined.
Dr. Vergot and Dr. Lindblad were sentenced to 24 and 28 months in custody, respectively, by U.S. District Judge Janis L. Sammartino. The custodial portion of each defendant’s sentence will be split between prison and home confinement. Each was also sentenced to pay a $15,000 fine.
"This conspiracy inflicted nearly $65 million in actual losses to TRICARE, the health care benefits program relied upon by millions of our military members and their families," said U.S. Attorney Robert Brewer. "It is hard to imagine a more outrageous example of selfish doctors stealing from the U.S. health care system believing they were exempt from providing necessary care."
"Today’s sentencings demonstrate our resolve to hold those accountable who seek to enrich themselves at the expense of taxpayers," said Michael Mentavlos, Special Agent in Charge of the Defense Criminal Investigative Service, Southwest Field Office. "TRICARE is a critical DoD program providing care for our service members, retirees, and their families. Together with our partners, we will continue to use all means available to root out fraud in this invaluable program."
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 requires a particular dosage or application or is allergic to a dye or other ingredient.
According to the sentencing memorandum, as part of this conspiracy a team of individuals worked to recruit and pay Marines, primarily from the San Diego area, and their dependents – all TRICARE beneficiaries – to obtain compounded medications that would be paid for by TRICARE. This information was sent to Choice MD, the Tennessee medical clinic that employed Dr. Vergot and Dr. Lindblad. Dr. Vergot and Dr. Lindblad then wrote prescriptions for the TRICARE beneficiaries, despite never examining the patients. Once signed by the doctors, these prescriptions were not given to the straw beneficiaries, but sent directly to particular pharmacies controlled by co-conspirators, most often a small pharmacy, The Medicine Shoppe in Bountiful, Utah, which filled the prescriptions and mailed the drugs to the patients in California.
Between November 2014 and June 2015, Drs. Vergot and Lindblad authorized 6,694 prescriptions, for which their co-conspirators billed TRICARE a staggering $89,725,000. Of this amount, over $65 million was for prescriptions written for straw TRICARE beneficiaries in the Southern District of California.
Defendants Vergot and Lindblad are the second and third defendants sentenced in this matter. CFK, Inc., the corporate owner of The Medicine Shoppe, was sentenced previously. A nurse practitioner, Candace Craven, previously pleaded guilty, as have the patient recruiters, including Joshua Morgan, Kyle Adams, Daniel Castro, Jeremy Syto, and Bradely White. All await sentencing. Jimmy and Ashley Collins, the owners of Choice MD, were charged by Superseding Indictment in June 2020. Their case remains pending. .
DEFENDANTS Case Numbers: 18-CR-1850-JLS, 18-CR-1855-JLS
Carl Lindblad Age: 77 Chattanooga, TN
Susan Vergot Age: 65 Chattanooga, TN
SUMMARY OF CHARGES
Conspiracy to Commit Health Care Fraud – Title 18, U.S.C § 1349
Maximum penalty: Ten years in prison and $250,000 fine or double loss amount, whichever is greater
AGENCY
Defense Criminal Investigative Service
Naval Criminal Investigative Service
IRS Criminal Investigation Division, Gulfport, MS
Federal Bureau of Investigation - Jackson, MS Field Office
Sureno Gang Member Sentenced to 10 Years in Federal Prison for Discharge of a Firearm During a Crime of ViolenceRead the Press Release
Spokane – William D. Hyslop, United States Attorney for the Eastern District of Washington, announced that Raymond Zack Guerrero-Garcia, age 29, of Toppenish, Washington, a Sureno Gang Member, and an enrolled member of the Confederated Bands and Tribes of the Yakama Nation, was sentenced today after having pleaded guilty on July 7, 2020, to Discharge of a Firearm During a Crime of Violence. Senior United States District Judge Lonny Suko sentenced Guerrero-Garcia to a 10-year term of imprisonment, to be followed by a 5-year term of court supervision after he is released from federal prison.
According to information disclosed during court proceedings, in January 2017, the victim stole drugs from Guerrero-Garcia and damaged his vehicle. In May 2017, the victim learned that Guerrero-Garcia’s mother had passed away. The victim traveled to Guerrero-Garcia’s residence, located within the external boundaries of the Yakama Nation, to offer condolences. Guerrero-Garcia approached the victim, pulled out a firearm, and shot the victim. Guerrero-Garcia then entered the victim’s vehicle and stole property including a stereo.
United States Attorney Hyslop said, “The United States Attorney’s Office for the Eastern District of Washington commends the law enforcement officers with the Yakima County Sheriff’s Office, the Toppenish Police Department, the Yakama Nation Police Department, and the Bureau of Alcohol, Tobacco, Firearms, and Explosives who investigated this case. Their seamless partnership resulted in the successful outcome of this matter. The sentence imposed by the court removes a violent gang member from our streets and sends a clear message to others who may choose to engage in such criminal activity.”
This case was prosecuted under the Project Safe Neighborhoods (PSN) program. PSN is a federal, state, and local law enforcement collaboration to identify, investigate, and prosecute individuals responsible for violent crimes in our neighborhoods. The U.S. Attorney’s Office is partnering with federal, state, local, and tribal law enforcement to specifically identify the criminals responsible for violent crime in the Eastern District of Washington and pursue criminal prosecution.
This case was investigated by the Yakima County Sheriff’s Office, the Toppenish Police Department, the Yakama Nation Police Department, and the Yakima Resident Office of the Bureau of Alcohol, Tobacco, Firearms, and Explosives. This case was prosecuted by Tom Hanlon, an Assistant United States Attorney for the Eastern District of Washington.
Statement by Attorney General William P. Barr on the Passing of Justice Ruth Bader GinsburgRead the Press Release
Attorney General William P. Barr has released the following statement:
“On behalf of the Department of Justice, I extend my deepest sympathy on the passing of Justice Ruth Bader Ginsburg. Justice Ginsburg led one of the great lives in the history of American law. She was a brilliant and successful litigator, an admired court of appeals judge, and a profoundly influential Supreme Court Justice. For all her achievements in those roles, she will perhaps be remembered most for inspiring women in the legal profession and beyond. She and I did not agree on every issue, but her legal ability, personal integrity, and determination were beyond doubt. She leaves a towering legacy, and all who seek justice mourn her loss.”
Statement by Acting Solicitor General Jeffrey B. Wall on the Passing of Justice Ruth Bader GinsburgRead the Press Release
Acting Solicitor General Jeffrey B. Wall has released the following statement:
“On behalf of the Office of the Solicitor General, we mourn the loss of Justice Ruth Bader Ginsburg. Justice Ginsburg was rightly renowned among people of all backgrounds, but she has a special significance to Supreme Court lawyers. She was herself a pathmarking advocate before the Court in landmark equal-protection cases in the 1970s. And during her 40 years on the Supreme Court and D.C. Circuit, she was equally formidable from the other side of the lectern. She was an incisive questioner, a clear and careful writer, and a model of dignity and civility. In the process, Justice Ginsburg served as an inspiration to this office, the Supreme Court bar, and far beyond. I extend our deepest condolences to her family, her colleagues on the Court, her former law clerks, and all who knew and admired her.”
Southington Woman Sentenced to 2 Years in Federal Prison for Embezzling $370K from EmployerRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that LYDIA CABRERA, 37, of Southington, was sentenced today by U.S. District Judge Jeffrey A. Meyer in New Haven to 24 months of imprisonment, followed by three years of supervised release, for embezzling $370,000 from her employer.
According to court documents and statements made in court, from approximately August 2016 to August 2018, Cabrera was employed by A2Z Home Medical Supplies (“A2Z”) as a bookkeeper. As part of her job responsibilities, Cabrera was given access to A2Z’s online merchant payment system. Approximately 10 days after being hired by A2Z, Cabrera began to use A2Z’s online merchant payment system to steal from the company by falsely representing that customers of A2Z had sought a return of their funds. On approximately 272 occasions, Cabrera input her personal debit card information as the card to which the funds should be returned. Through this scheme, Cabrera embezzled approximately $370,000.
Judge Meyer ordered Cabrera to make full restitution to A2Z.
Prior to working for A2Z, Cabrera worked as a bookkeeper for a home health care aid company. Between April 2015 and July 2016, Cabrera stole approximately $68,000 from the company. This fraud scheme was prosecuted in state court. In advance of her sentencing in this matter, Cabrera submitted to the state court fictitious character letters from A2Z colleagues in an attempt to obtain leniency at sentencing.
Cabrera was arrested on March 1, 2019. On October 23, 2019, she pleaded guilty to one count of bank fraud.
Cabrera, who has been released on bond since the date of her guilty plea, is required to report to prison on January 5, 2021.
This matter was investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney John T. Pierpont, Jr.
Southbridge Man Indicted for Cocaine PossessionRead the Press Release
BOSTON – A Southbridge man was indicted by a federal grand jury yesterday for cocaine possession.
Revel Pedro Rivera, 42, was indicted on one count of attempted possession with intent to distribute 500 grams or more of cocaine. Rivera was previously arrested and charged by criminal complaint on July 7, 2020.
According to charging documents, in early July 2020, federal agents intercepted a package containing a kilogram of cocaine that was shipped to Rivera’s residence. Agents removed the cocaine and replaced it with a counterfeit substance. On July 6, 2020, Rivera accepted delivery of the package and was arrested as he left the property with the package that he believed contained cocaine.
The charge of possession with intent to distribute 500 grams or more of cocaine provides for a mandatory minimum sentence of five years and up to 40 years in prison, four years of supervised release and a fine of up to $5 million. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling; Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration, Boston Field Division; Joseph W. Cronin, Postal Inspector in Charge of the U.S. Postal Inspection Service, Boston Division; and Southbridge Police Chief Shane Woodson made the announcement. Assistant U.S. Attorney Danial Bennett of Lelling’s Worcester Branch Office is prosecuting the case.
The details contained in the charging document are allegations. The defendant is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Six indicted in connection with multi-million dollar scheme to bribe Amazon employees and contractorsRead the Press Release
Seattle - Six people have been indicted by a Grand Jury in the Western District of Washington with conspiring to pay over $100,000 in commercial bribes to Amazon employees and contractors, in exchange for an unfair competitive advantage on the Amazon Marketplace, announced U.S. Attorney Brian T. Moran. EPHRAIM ROSENBERG, 45, of Brooklyn, New York; JOSEPH NILSEN, 31, and KRISTEN LECCESE, 32, of New York, New York; HADIS NUHANOVIC, 30, of Acworth, Georgia; ROHIT KADIMISETTY, 27, of Northridge, California; and NISHAD KUNJU, 31, of Hyderabad, India, are charged with conspiracy to use a communication facility to commit commercial bribery, conspiracy to access a protected computer without authorization, conspiracy to commit wire fraud, and wire fraud. The defendants will make their initial appearances in U.S. District Court in Seattle on October 15, 2020.
“As the world moves increasingly to online commerce, we must ensure that the marketplace is not corrupted with unfair advantages obtained by bribes and kick‑backs,” said U.S. Attorney Brian T. Moran. “The ultimate victim from this criminal conduct is the buying public who get inferior or even dangerous goods that should have been removed from the marketplace. I commend the investigators and cybersecurity experts who have worked to identify and indict those engaged in these illegal schemes.”
“Realizing they could not compete on a level playing field, the subjects turned to bribery and fraud in order to gain the upper hand. What's equally concerning, not only did they attempt to increase sales of their own products, but sought to damage and discredit their competitors,” said Raymond Duda, Special agent in charge, FBI Seattle. “This indictment should send a message that the FBI will not sit on the sidelines while criminals try to cheat their way to the top.”
According to the Indictment, since at least 2017, the defendants have used bribery and fraud to benefit merchant accounts on the Amazon Marketplace, resulting in more than $100 million of competitive benefits to those accounts, harm to competitors, and harm to consumers. More specifically, the Indictment alleges that the defendants served as consultants to so-called third-party (“3P”) sellers on the Amazon Marketplace. Those 3P sellers consisted of individuals and entities who sold a wide range of goods, including household goods, consumer electronics, and dietary supplements on Amazon’s multi-billion-dollar electronic commerce platform. In addition to providing consulting services to these 3P sellers, some of the defendants, including NILSEN, LECCESE, and NUHANOVIC, made their own sales on the Amazon Marketplace through 3P accounts they operated.
In the course of the conspiracy described in the Indictment, the defendants paid bribes to at least ten different Amazon employees and contractors, including KUNJU, who accepted bribes as a seller-support associate in Hyderabad, India, before becoming an outside consultant who recruited and paid bribes to his former colleagues. In exchange for those bribes, the corrupted employees and contractors took the following illicit steps:
- Reinstating suspended merchant accounts and product listings on the Amazon Marketplace: The corrupted employees and contractors helped reinstate products and merchant accounts that Amazon had suspended or blocked entirely from doing business on the Amazon Marketplace. The fraudulently reinstated products included dietary supplements that had been suspended because of customer-safety complaints, household electronics that had been flagged as flammable, consumer goods that had been flagged for intellectual-property violations, and other goods. The fraudulently reinstated accounts included accounts that Amazon had suspended for manipulating product reviews to deceive consumers, making improper contact with consumers, and other violations of Amazon’s seller policies and codes of conduct. The Indictment describes a variety of ways in which corrupted employees and contractors misused their positions to reinstate these accounts, including by manually reinstating product listings, and approving baseless and fraudulent merchant appeals that they themselves helped draft. In total, after their fraudulent reinstatement, the products and merchants earned in excess of $100 million in sales revenue.
- Facilitating attacks against competitors: The corrupted employees and contractors facilitated attacks against competitors’ 3P accounts and product listings, by (a) sharing competitive intelligence about competitors’ revenues, customers, advertising campaigns, and suppliers; (b) using their inside access to Amazon’s network to suspend competitors’ 3P accounts; and (c) providing consultants with information about Amazon’s internal algorithms, which allowed the consultants to flood competitors’ product listings with fictitious negative product reviews.
- Misappropriating Amazon’s highly confidential business information: The corrupted employees and contractors also provided consultants and 3P sellers with unauthorized access to Amazon’s highly confidential standard operating procedures and algorithms. These materials provided an obvious, unfair, competitive benefit to 3P sellers, by giving them coveted insight into the systems that power Amazon’s search engine, Amazon’s product reviews, and Amazon’s enforcement processes. The misappropriated data also included the contact information for Amazon employees and consumers, which the members of the conspiracy misused and shared widely.
- Circumventing Amazon’s internal limits on 3P accounts: The corrupted employees and contractors conveyed exclusive benefits that circumvented Amazon’s rules and regulations. In exchange for bribes, they increased 3P sellers’ storage limits in Amazon’s warehouses, facilitated 3P sellers’ otherwise meritless requests to sell products in restricted categories, and provided 3P sellers with inside knowledge about the most successful advertising campaigns and most profitable product listings.
Conspiracy to use a communication facility in furtherance of commercial bribery, and to gain unauthorized access to a protected computer is punishable by up to five years in prison and a $250,000 fine.
Conspiracy to commit wire fraud, and wire fraud, are punishable by up to 20 years in prison and a $250,000 fine.
The case is being investigated by the Federal Bureau of Investigation (FBI), with assistance from the Internal Revenue Service-Criminal Investigations, and the Department of Justice Office of International Affairs.
The case is being prosecuted by Assistant United States Attorneys Siddharth Velamoor and Steven Masada.
20cr151_1_reduced-print-color.pdfSioux Falls Man Charged with Possession of a Firearm While Under IndictmentRead the Press Release
United States Attorney Ron Parsons announced that a Sioux Falls, South Dakota, man has been indicted by a federal grand jury for Possession of a Firearm While Under Indictment.
Judah Conrad Wainscoat, age 29, was indicted on September 1, 2020. He appeared before U.S. Magistrate Judge Veronica L. Duffy on September 17, 2020, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 5 years in federal prison and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on or about April 27, 2020, Wainscoat, while subject to an indictment filed in state court in South Dakota that charged a crime punishable by imprisonment for a term exceeding one year, received a 9mm Luger caliber, semi-automatic pistol, which had been shipped and transported in interstate commerce.
The charge is merely an accusation and Wainscoat is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Sioux Falls Police Department. Assistant U.S. Attorney Jeffrey C. Clapper is prosecuting the case.
Wainscoat was remanded to the custody of the U.S. Marshals Service pending trial, which has been set for November 24, 2020.
Simsbury Woman Sentenced to 41 Months in Federal Prison for Embezzling More Than $580KRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that PAMELA HILL, 55, of Simsbury, was sentenced today by U.S. District Judge Jeffery A. Meyer in New Haven to 41 months of imprisonment, followed by three years of supervised release, for embezzling approximately $584,000.
According to court documents and statements made in court, between 2013 and 2018, Hill embezzled more than $500,000 from a company where she was employed as a controller. Hill wrote company checks to herself, applied signature stamps with the owner’s signature to the checks, and deposited the checks into her own bank account. She also issued electronic payments to her bank account and disguised the payments to make them appear to payments to vendors. When the company’s CFO questioned Hill about a vendor payment in December 2018, Hill provided the CFO with an altered bank statement that falsely reflected the payment had been credited back to the company’s account.
The investigation also revealed that Hill defrauded a separate individual for whom she provided bookkeeping services.
Judge Meyer ordered Hill to pay restitution of $518,161.45 to the victim company and the victim company’s insurer, and $66,076.96 to the victim individual.
On November 26, 2019, Hill pleaded guilty to one count of wire fraud.
Hill was previously convicted in federal court of conspiracy to defraud the United States for assisting a former employer commit income tax fraud. In December 2003, she was sentenced to two years of probation for that offense.
Hill, who is released on a $100,000 bond, is required to report to prison on October 23, 2020.
This matter was investigated by the Federal Bureau of Investigation and prosecuted by Assistant U.S. Attorney Jennifer R. Laraia.
San Gabriel Woman Linked to Spate of Drug Overdoses in Pasadena Charged with Federal Narcotics Trafficking OffenseRead the Press Release
LOS ANGELES – Prosecutors today filed a criminal complaint against a San Gabriel woman who allegedly sold narcotics to several individuals in Pasadena who suffered overdoses on September 11.
Marisol Bolanos Hernandez, 35, was charged today with one count of drug distribution resulting in serious bodily injury.
Bolanos allegedly sold narcotics to a man who, along with a friend, was found unresponsive at a Pasadena location on the evening of September 11. The two victims were transported to local hospitals, where one recovered, but another died two days later. Pasadena Police officers seized white powder residue from the location of the overdoses, but that material has yet to be tested, according to the affidavit in support of the complaint.
At the hospital, the surviving victim, identified as A.C., responded to Narcan, indicating there were opioids present, and his urine samples were positive for cocaine. A.C. was released from the hospital the following day and told Pasadena Police that he purchased cocaine from “Mari,” shared some of the drugs with the deceased victim, and lost consciousness after taking the purported cocaine, according to the affidavit. Investigators have determined that Mari is Bolanos through evidence that includes A.C. identifying her out of a six-photo lineup, the affidavit states.
The narcotics distribution charge in the complaint relates to the drugs allegedly sold to A.C.
The affidavit also alleges that Bolanos sold purported cocaine to two other overdose victims on September 11. Both of these victims required hospitalization and survived. Phone records link Bolaros to another fatal overdose on September 11, according to the affidavit.
Pasadena Police detained Bolanos on September 16. During an interview she admitting selling what she believed to be cocaine to three of the overdose victims, including A.C., on September 11, according to the affidavit.
Bolanos was taken into federal custody on Thursday by special agents with the Drug Enforcement Administration. She is expected to make her initial appearance this afternoon in United States District Court in downtown Los Angeles.
A criminal complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
The charge of drug distribution resulting in serious bodily injury carries a mandatory minimum sentence of 20 years in federal prison and a maximum sentence of life imprisonment.
The case against Bolanos is the result of an ongoing investigation by the DEA and the Pasadena Police Department.
This matter is being prosecuted by Assistant United States Attorney Brittney M. Harris of the International Narcotics, Money Laundering, and Racketeering Section.
Rosebud Man Charged with Assaulting Federal OfficerRead the Press Release
United States Attorney Ron Parsons announced that a Rosebud, South Dakota, man has been indicted by a federal grand jury for Assaulting, Resisting, and Impeding a Federal Officer.
Adam Moran, a/k/a Cante Moran, age 26, was indicted on September 9, 2020. He appeared before U.S. Magistrate Judge Mark A. Moreno on September 16, 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, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on May 19, 2020, in Todd County, South Dakota, Moran did forcibly assault, oppose, impede, intimidate, and interfere with multiple law enforcement officers who were employed by the Rosebud Sioux Tribe.
The charges are merely accusations and Moran is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Rosebud Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Kirk Albertson is prosecuting the case.
Moran was released on bond pending trial. A trial date has been set for November 17, 2020.
Philadelphia Man Convicted at Trial of Illegal Firearms PossessionRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that William Johnson, 34, of Philadelphia, PA was convicted today at trial of possession of a firearm by a convicted felon, arising from an incident in which Philadelphia police officers recovered a weapon that Johnson had tried to discard while attempting to evade capture.
In September 2019, Philadelphia Police Department Highway Patrol Officers responded to reports of a person with a gun at 15th Street and West Allegheny Avenue in North Philadelphia. Upon arrival, the officers observed the defendant walking with a person that matched the description in the report. When the officers got out of their car to investigate, Johnson took off in a full sprint while holding onto his waistband. He then cut through an empty lot and climbed a fence in an attempt to flee. An officer drove around to where Johnson would be expected to emerge on the other side of the lot. When Johnson climbed the fence that led away from the lot, he spotted yet another police officer. Johnson then jumped down from the fence and the officers observed him toss a firearm a few feet away. The officers then took Johnson into custody and secured the firearm.
“Everybody knows what is happening in Philadelphia today with the staggering violent crime rates, and everybody also knows the reason for it – a lack of enforcement at the local level. One of the ways that my Office is working to combat this chaos is by stepping in to aggressively prosecute cases in which convicted felons illegally possess firearms,” said U.S. Attorney McSwain. “This was not an easy case, and in fact resulted in a hung jury the first time we tried it back in January. But now justice has been done, thanks to the determination of the prosecution team and our law enforcement partners in this case, the FBI, the ATF, and the Philadelphia Police Department. This is the kind of commitment that is needed to keep our community safe.”
“The FBI is committed to working with our law enforcement partners to get guns out of the hands of convicted felons and off the streets,” said, Michael J. Driscoll, Special Agent in Charge of the FBI’s Philadelphia Division. “In order to reduce violent crime, we must stay vigilant and keep firearms away from those not permitted to possess them.”
The case was investigated by the Federal Bureau of Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorney Robert Eckert.
Operation Shutdown Corner Update: Michigan Man Sentenced to Five Years in Prison for Federal Drug CrimeRead the Press Release
BECKLEY, W.Va. – A Michigan man was sentenced to federal prison for participating in a drug trafficking organization (DTO) in Raleigh County, announced United States Attorney Mike Stuart. Clifford Howell, 31, of Eastpointe, Michigan, was sentenced to 60 months in prison, to be followed by a five-year term of supervised release.
Howell is one of 17 defendants charged in federal court as a result of a long-term investigation known as Operation Shutdown Corner.
“Great work by the more than 200 law enforcement agents from more than five states who were involved in Operation Shutdown Corner,” said United States Attorney Mike Stuart. “The operation took down a major drug trafficking organization and 17 people have been charged as a result. It stands as a significant achievement in our goal to rid our district of out-of-state drug dealers.”
Howell admitted at his plea hearing in June 2020 that between June 2018 and September 17, 2019, he worked with other members of a DTO operating in Raleigh County to distribute heroin. During this time period, Howell admitted to traveling to Michigan to obtain heroin, and then returning to the Southern District of West Virginia to supply other members of the DTO with the heroin. Howell admitted that during this time period he supplied other members of the DTO with more than 100 grams of heroin, knowing it was the plan and purpose of the other members to redistribute the drugs within the Southern District of West Virginia.
The case was investigated by the Federal Bureau of Investigation (FBI), the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the United States Postal Inspection Service (USPIS), the Beckley/Raleigh County Drug and Violent Crimes Task Force, the Raleigh County Sheriff’s Office, the Beckley Police Department and the West Virginia State Police.
United States District Judge Frank W. Volk imposed the sentence. Assistant United States Attorney Timothy D. Boggess handled the prosecution.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 5:19-cr-00227.
Follow us on Twitter: SDWVNews and USAttyStuart
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Operation Legend: Case of the DayRead the Press Release
Each weekday, the Department of Justice will highlight a case that has resulted from Operation Legend. Today’s case is out of the Northern District of Ohio. Operation Legend launched in Cleveland on July 29, 2020, in response to the city facing increased homicide and non-fatal shooting rates.
United States vs. Antwan Bohanon
An Ohio man was charged on Aug. 13, 2020, in federal court in the Northern District of Ohio with illegally dealing in firearms without a federal firearms license.
“This defendant is accused of dealing firearms in the city of Cleveland without a license,” said U.S. Attorney Justin Herdman. “He went to great lengths to acquire, advertise and sell firearms to many people in the city of Cleveland, including those who are prohibited under federal law from purchasing or possessing a gun. In fact, some of the firearms that the defendant allegedly sold later appeared in separate criminal cases. Even just one gun in the hands of someone who should not be in possession of a firearm can have dire consequences.”
According to court documents, Antwan Bohanon allegedly purchased multiple firearms outside of the city of Cleveland and later resold them inside of the city to various individuals, including some prohibited under federal law from purchasing or possessing a firearm. Bohanon would often post images of his firearms for sale to his personal Instagram account at prices higher than market value. According to the ATF affiant of the affidavit in support of the criminal complaint, individuals who are unable to purchase firearms legitimately will frequently pay a much higher price to obtain one.
In addition, court documents show that some of the firearms Bohanon sold were later used in criminal activity.
The following is a list of firearms Bohanon is accused of importing, manufacturing, or dealing:
- A Glock, Model 22 pistol
- A Glock, Model 19 pistol
- A Ruger, Model Lc9 pistol
- A Glock, Model 23 pistol
- A Ruger, Model SR9c pistol
- A Glock model 26 pistol
- A Taurus, model PT92AF pistol
- A Smith and Wesson, Model SD40VE pistol
- A Taurus, Model PT24/7 Pro C pistol
- A Smth and Wesson, Model M&P 9 Shield pistol
- A Glock, Model 40 pistol
- A Taurus, Model PT111 G2 pistol
- A Taurus, Model G2C pistol
- A Taurus, Model G2C pistol
- A Tuarus, Model G2C pistol
- A Tuarus, Model PT111 G2 pistol
- A Tuarus, Model PT111 G2 pistol
- A Glock, Model 19 pistol
- A Springfield/HS Product Model XD pistol
- A Glock, Model 23 pistol
- A Tuarus, Model PT111 G2 pistol
- A Tuarus, Model PT111 G2 pistol
- A Springfield/HS Product Model XD pistol
- A Glock, Model 30S pistol
- A Glock, Model 26 pistol
- A Glock, Model 27 pistol
- A Glock, Model 26 pistol
- A Glock, Model 23 pistol
- A Glock, Model 23 pistol
- A Tuarus, Model PT111 G2 pistol
- A Tuarus, Model PT111 G2 pistol
- A Ruger, Model LC9 pistol
- A Glock, Model 27 pistol
- A Glock, Model 26 pistol
- A Glock, Model 23 pistol
- A Glock, Model 26 pistol
- A Glock, Model 27 pistol
- A Springfield/HS Product Model XD pistol
- A Ruger, Model Security 9 pistol
The details contained in the charging document are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Background on Operation Legend
Since its inception, Operation Legend has yielded more than 2000 local, state, and federal arrests, with more than 592 defendants charged with federal crimes.
President Trump promised to assist America’s cities that have been plagued by violence. In July, Attorney General William P. Barr announced the launch of Operation Legend, a sustained, systematic and coordinated law enforcement initiative across all federal law enforcement agencies working in conjunction with state and local law enforcement officials to fight violent crime in cities across America that were experiencing an uptick in violence. Operation Legend is named after four-year-old LeGend Taliferro, who was shot and killed on June 29th in Kansas City, Missouri, while asleep in his home.Operation Legend was launched in Kansas City, Mo., on July 8, 2020, and expanded to Chicago and Albuquerque on July 22, 2020, to Cleveland, Detroit, and Milwaukee on July 29, 2020, to St. Louis and Memphis on Aug. 6, 2020, and to Indianapolis on Aug. 14, 2020. As part of Operation Legend, Attorney General Barr has directed federal agents from the FBI, U.S. Marshals Service, DEA and ATF to surge resources to these cities to help state and local officials fighting violent crime.
Ohio Woman Sentenced on Gun ChargeRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, NY – U.S. Attorney James P. Kennedy, Jr. announced today that Vicky Hoffstetter, 38, of Painesville, OH, who was convicted of conspiracy to transfer firearms purchased outside of state of residency, was sentenced to time served and two years’ supervised release by U.S. District Judge Elizabeth A. Wolford.
Assistant U.S. Attorney Charles J. Volkert, Jr., who handled the case, stated that between April 2018 and May 2018, the defendant, without being a licensed firearm importer, manufacturer, dealer, or collector, conspired with others, to transport firearms into New York State from the State of Ohio. Hoffstetter conducted straw purchases of firearms in Ohio in her own name, while knowing that the firearms were actually paid and intended for a co-conspirator, who lived in Buffalo, New York.
The sentencing is the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, under the direction of Special Agent-in-Charge John B. Devito, New York Field Division, and the Buffalo Police Department, under the direction of Commissioner Byron Lockwood.
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Office for Victims of Crime Awards Nearly $3 Million to Support Victims of 2019 Colorado School ShootingRead the Press Release
DENVER – United States Attorney Jason R. Dunn along with the Justice Department’s Office for Victims of Crime, a division of the Office of Justice Programs, today announced that $2,878,767 in funds from the Antiterrorism and Emergency Assistance Program has been awarded to the Colorado Division of Criminal Justice to assist victims of the 2019 shooting at STEM School in Highlands Ranch, Colorado.
On May 7, 2019, one student was killed and eight others were injured when two students fired weapons in a Highlands Ranch classroom. At the time of the incident, there were 20 other students and a teacher in the classroom and many indirect victims, including the 1,827 students at the school, their families, 160 school staff members and law enforcement and emergency personnel who responded to the scene.
“An act of violence both calculated and senseless claimed an innocent young life and caused physical and emotional harm to many others,” said OJP Principal Deputy Assistant Attorney General Katharine T. Sullivan. “We continue to grieve with the family of Kendrick Castillo and offer our prayers and support to the students and faculty of the STEM School and to the entire community of Highlands Ranch.”
“Our hope is that these funds will help the victims of this senseless tragedy continue forward in their healing process,” said U.S. Attorney Jason Dunn. “The Department of Justice and my office will never forget Kendrick, the STEM family, and the entire Highlands Ranch community.”
Funding will help the Colorado Division of Criminal Justice serve victims during the aftermath of this tragedy. Program funds will reimburse organizations for immediate, necessary services provided to the victims in the community and will provide ongoing trauma-informed, evidence-based healing and resiliency services to the students, families, employees and first responders. Services include meetings with a national school crisis and bereavement expert for students, parents and staff; STEM School Resiliency Center expenses, including mental health services and training for clinicians and a resiliency coordinator; supplemental victim compensation expenses; victim security at court proceedings; and mental health services for first responders.
“We mourn with those whose lives will forever be affected by this reprehensible crime,” said OVC Director Jessica E. Hart. “The disruption of so many young lives – and the horrific death of one child – continues to send ripples of sorrow through the Highlands Ranch community. There remains important work to be done and I hope this funding answers the call for assistance by the organizations that provided crisis response services in the immediate aftermath and that continue to serve the victims, their families, and the community.”
Since 1995, Office for Victims of Crime Antiterrorism and Emergency Assistance Program grants have provided supplemental support to victims and jurisdictions that have experienced incidents of terrorism or mass violence. The funding comes from the Crime Victims Fund, financed by fines and penalties paid by convicted federal offenders.
For more information on this grant program, visit https://www.ovc.gov/AEAP/
About the Office of Justice Programs: The Office of Justice Programs, directed by Principal Deputy Assistant Attorney General Katharine Sullivan, provides federal leadership, grants, training, technical assistance and other resources to improve the nation’s capacity to prevent and reduce crime, assist victims and enhance the rule of law by strengthening the criminal and juvenile justice systems. More information about OJP and its components can be found at www.ojp.gov.
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.
Napa Valley Gang Member Charged with Unlawful Possession of a FirearmRead the Press Release
SAN FRANCISCO – A criminal complaint was unsealed today in federal court charging Eduardo Bermudez Gomez with unlawful possession of a firearm, announced United States Attorney David L. Anderson and Homeland Security Investigations Special Agent in Charge Tatum King.
According to the criminal complaint, on or about February 1, 2020, Gomez, 28, of Napa, California and a twice-convicted felon, is alleged to have been driving under the influence and brandishing a firearm at innocent individuals. After receiving reports of a possible DUI, Napa Valley Police officers identified Gomez’s vehicle and attempted to conduct a traffic stop. Gomez fled the traffic stop, subsequently crashed his vehicle into and severely damaged a number of parked cars, and overturned his own vehicle. Officers arrested Gomez and found a .25 caliber Beretta handgun on his person and a 9mm Ruger handgun at the scene. Two rounds of 9mm ammunition along with 0.3 grams of cocaine were also recovered. Earlier that evening, Gomez is reported have to nearly crashed with a separate driver by driving directly at her, and to have brandished his firearm at another vehicle which contained two innocent victims. Gomez is associated with the Sureños.
Gomez was arrested September 17, 2020, and made his initial appearance in federal court in Oakland this morning. Defendant is currently in federal custody. Defendant’s next scheduled appearance is for September 21, 2020, at 10:30 a.m., before U.S. Magistrate Judge Alex G. Tse, for the continuation of the initial appearance.
The charges contained in the criminal complaint are mere allegations. As in any criminal case, the defendant is presumed innocent unless and until proven guilty in a court of law.
Assistant U.S. Attorney Ankur Shingal is prosecuting the case with the assistance of Alexa Leisure and Angelica Jao. The prosecution is the result of an investigation by Homeland Security Investigations, the Napa District Attorney’s Office, and the Napa Special Investigations Bureau.