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Tuesday 14 July 2020
Fannin County Woman Sentenced for Tax FraudRead the Press Release
SHERMAN, Texas – A 40-year-old Honey Grove, Texas woman has been sentenced to federal prison for tax fraud in the Eastern District of Texas, announced U.S. Attorney Stephen J. Cox today.
Kristi Michelle Finney, also known as Kristi Michelle Fry, pleaded guilty on Aug. 29, 2019 to five counts of tax fraud. On July 2, 2020, U.S. District Judge Amos Mazzant sentenced Finney to 33 months in federal prison. Finney was also ordered to pay restitution of $359,733 to the Internal Revenue Service.
According to information presented in court, from 2013 to 2018, Finney offered tax services from her home, where she would complete and file tax returns for others at a fee of around $200. An IRS investigation linked 147 suspicious tax returns to Finney, many of which contained false employment, income, and expense information. Specifically, Finney would claim large financial losses for businesses that never existed, resulting in a larger tax refund for her clients than they would otherwise be entitled to. Finney would then divert portions of the fraudulent tax refund to herself by placing the refunds on prepaid debit cards. Finney concealed her involvement by falsely claiming that the fraudulent returns were personally prepared by her clients, rather than her. The IRS was ultimately able to identify Finney as the filer of these returns through internet protocol addresses and email addresses associated with the electronic returns, as well as through witness interviews.
This case was investigated by the Internal Revenue Service, Criminal Investigation, and prosecuted by Assistant U.S. Attorney Wes Wynne.
Erie Felon Charged with Illegally Possessing a FirearmRead the Press Release
ERIE, Pa. - A resident of Erie, Pennsylvania has been indicted by a federal grand jury in Erie on a charge of violating federal firearms laws, United States Attorney Scott W. Brady announced today.
The one-count Indictment named William Anthony Eldridge, 56, as the sole defendant.
According to the Indictment presented to the court, on or about May 18, 2020, Eldridge possessed a firearm while being a convicted felon.
The law provides for a maximum total sentence of 10 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Paul S. Sellers is prosecuting this case on behalf of the government.
The Erie Police Department and the Erie Law Enforcement Crime Task Force-Gun Working Group conducted the investigation leading to the indictment in this case. The Erie Law Enforcement Crime Task Force-Gun Working Group is a multi-agency taskforce consisting of federal, state, county and local law enforcement partners and agencies that formed in 2015 to combat gun violence in the Erie area.
Project Safe Neighborhoods (PSN) is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
This case is also part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the Fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see www.justice.gov/projectguardian.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
EOIR Announces Disciplinary Action Under Rules of Professional ConductRead the Press Release
FALLS CHURCH, VA – The Executive Office for Immigration Review (EOIR) today announced that it has ordered Phoenix Attorney Jose A. Bracamonte suspended for 45 days from practice before the Board of Immigration Appeals, the immigration courts, and the Department of Homeland Security (DHS), effective July 15, 2020.
“EOIR will continue to pursue disciplinary actions to address the misuse and manipulation of the asylum process by immigration practitioners. Such actions detract from the timely processing of legitimate asylum claims and undermine the overall integrity of the asylum system,” said EOIR Director James McHenry. Adjudicating Official Irene C. Feldman issued the decision and final order on July 1, 2020, between Bracamonte and EOIR Disciplinary Counsel Paul A. Rodrigues and DHS Disciplinary Counsel Catherine M. O’Connell.
On Nov. 3, 2016, DHS and EOIR jointly initiated disciplinary proceedings against Bracamonte based on complaints that he filed affirmative asylum applications with U.S. Citizenship and Immigration Services for the sole purpose of causing DHS to issue Notices to Appear (NTAs) to his clients, without any intention to pursue asylum or related forms of relief. DHS and EOIR alleged that Bracamonte’s conduct violated the Rules of Professional Conduct (8 C.F.R. § 1003.102). Specifically, Bracamonte made false statements of material fact, and engaged in frivolous behavior, conduct lacking competence, and conduct prejudicial to the administration of justice.
Pursuant to the settlement agreement, Bracamonte acknowledged that his conduct was an abuse of the asylum system. Bracamonte admitted that he engaged in unprofessional and improper conduct when he filed affirmative asylum applications without an indicated basis for asylum or an indication as to any asylum claim, cancelled or otherwise advised clients to fail to appear for asylum interviews before DHS, and did not demonstrate a clear intention to pursue an asylum claim, in order to cause DHS to issue an NTA and place his clients in removal proceedings before EOIR.
Complaints about professional misconduct by private attorneys or accredited representatives may be sent to the EOIR Disciplinary Counsel through Form EOIR-44.
Durable medical equipment company owner admits participation in kickback schemeRead the Press Release
SAVANNAH, GA: A Florida man who operated a durable medical equipment company has admitted participating in a Medicare kickback and telemedicine fraud scheme.
Patrick Wolfe, 48, of Belleair Beach, Fla., the operator of Wilmington Island Medical Inc., which does business as WI Medical Inc., a Georgia company, entered a guilty plea in U.S. District Court to one count of Conspiracy as charged in an Information, said Bobby L. Christine, U.S. Attorney for the Southern District of Georgia. Wolfe admits paying kickbacks in return for “leads,” which were in actuality signed orders from physicians and nurse practitioners, and then billing those orders to Medicare Part B and Medicare Part C using WI Medical.
The financial total for orders facilitated through this scheme is alleged to be in the millions of dollars. Medicare beneficiaries were located in the Southern District of Georgia and elsewhere.
The charge carries a sentence of up to five years in prison, plus substantial financial penalties and forfeitures, followed by three years of supervised release upon completion of any prison sentence. There is no parole in the federal system.
“When the delivery of health care turns from providing comfort to patients to padding the pockets of greedy criminals, our office and those of our law enforcement partners will be there to protect our federal treasury,” said U.S. Attorney Christine.
This prosecution, arising out of the related “Operation Brace Yourself” and “Operation Double Helix,” together with 25 other cases, involve the largest fraud operation in the history of the Southern District of Georgia. Those charged in this string of cases include eight physicians, two nurse practitioners, three operators of different telemedicine companies, three brokers of patient data, and several other owners of durable medical equipment companies. The Medicare and Medicaid beneficiaries whose identities were used as part of the scheme are located throughout the country, including throughout the Southern District of Georgia.
The combined $480 million in fraud charged in the Southern District of Georgia is part of nationwide operations by the Department of Justice that thus far has included allegations involving billions of fraudulent claims for genetic testing, orthotic braces, pain creams, and other items.
“Wolfe's admission of guilt is the first step in accountability for the damage he caused to Medicare and the tax payers of this country,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “We must send the message that the FBI and our federal partners are dedicated to protecting the health care needs of deserving Americans that our government-subsidized programs provide.”
“It’s an outright crime when health care decisions are based on illegal kickbacks instead of what’s in the best interest of the patient,” said Derrick L. Jackson, Special Agent in Charge at the U.S. Department of Health and Human Services, Office of Inspector General in Atlanta. “We will continue to work with our law enforcement partners to safeguard both the Medicare Trust Fund, as well as the health of our nation’s senior citizens.”
“Our nation’s healthcare system cannot tolerate kickbacks to physicians and pharmacies while criminals line their pockets with taxpayer-funded healthcare dollars, particularly in light of our nation’s current struggles with the COVID-19 pandemic,” said Resident Agent in Charge Glen M. Kessler, U.S. Secret Service. “Cases of this magnitude can only be tackled using a strategy that recognizes that the most effective way to fight these large criminal networks is by combining the strengths, resources, and expertise of our federal agencies.”
This investigation is ongoing. As telemedicine becomes an increasing part of our healthcare system, particularly during the COVID-19 pandemic, vigilance in ensuring that fraud and kickbacks do not usurp the legitimate practice of medicine by electronic means is more important than ever. If you are aware of any fraud or kickbacks relating to telemedicine, including COVID-19 fraud, please call the FBI hotline at 1-800-CALL-FBI.
This particular prosecution resulted from a joint investigation of multiple agencies and offices. U.S. Attorney Christine acclaimed the hard work of the investigatory team, led by FBI - Savannah, the Department of Health and Human Services Office of Inspector General, and the United States Secret Service.
Assistant U.S. Attorneys J. Thomas Clarkson and Jonathan A. Porter are prosecuting these cases on behalf of the United States.
District Man Indicted on Federal Charges for Vandalizing the Lincoln Memorial During ProtestsRead the Press Release
WASHINGTON – Micah Avery, 26, of Washington, D.C., was indicted today in federal court on charges of destruction of federal property for spray-painting the Lincoln Memorial last month, announced Acting U.S. Attorney for the District of Columbia Michael R. Sherwin and Acting Chief of the United States Park Police (USPP) Gregory T. Monahan.
The federal grand jury returned an indictment that alleges that on the afternoon of May 30, 2020, officers with the U.S. Park Police witnessed Avery graffiti the words “Yall not tired yet?” with black spray paint on the Lincoln Memorial (see photo below). Avery fled as the officers approached him. After a chase, officers apprehended and handcuffed Avery. Officers attempted to put the defendant into a patrol car, but he resisted their attempts. A crowd converged on the officers and began pushing and striking the officers. During this melee, Avery broke free and ran away. One of the officers sustained an injury to his hand. A look-out was broadcast, and Avery was located shortly thereafter by other officers back at the Lincoln Memorial, still wearing the handcuffs.
An indictment is a formal accusation of criminal conduct for purposes of establishing probable cause, not evidence of guilt. The defendant is presumed innocent unless proven guilty.
“Defacing one of our country’s national monuments will not be tolerated,” said Acting U.S. Attorney Michael R. Sherwin.
In announcing the indictment, Acting U.S. Attorney Sherwin and Acting Chief Monahan commended the work of the USPP officers who apprehended Avery and are investigating the incident. The case is being prosecuted by Assistant U.S. Attorney James B. Nelson of the U.S. Attorney’s Office for the District of Columbia.
Couple arrested for laundering over $400,000 on behalf of India-based phone scammersRead the Press Release
ATLANTA – Federal agents have arrested husband and wife Mehulkumar Manubhai Patel and Chitali Dave for laundering over $400,000 on behalf of India-based phone scammers.
“Criminal India-based call centers sought to prey on vulnerable members of our community and steal from them by misleading them over the phone,” said U.S. Attorney Byung J. “BJay” Pak. “Those, like Patel and Dave, who allegedly launder money in the United States on behalf of foreign-based fraudsters, are the linchpins of those schemes.”
“I commend the Department of Justice and Social Security’s Office of the Inspector General for their aggressive work to fight fraudsters who target Americans through various phone scams,” said Andrew Saul, Commissioner of Social Security. “People who receive suspicious calls should just hang up, and never give out their personal information. They should go online to oig.ssa.gov to report these Social Security scams.”
“This arraignment is a bold statement that we will aggressively pursue overseas phone scammers—and their facilitators in this country—who are stealing Americans’ hard-earned money,” said Inspector General Ennis. “I want to thank the U.S. Attorney’s Office in the Northern District of Georgia for bringing these charges, and our law enforcement partners for their efforts in investigating these scams and bringing the perpetrators to justice.”
According to U.S. Attorney Pak, the charges, and other information presented in court: Criminal India-based call centers defraud U.S. residents, including the elderly, by misleading victims over the telephone utilizing scams such as Social Security and tech support scams.
As part of their Social Security scam, India-based callers pose as federal agents in order to mislead victims into believing their Social Security numbers were involved in crimes. Callers threatened arrest and the loss of the victims’ assets if the victims did not send money. The callers directed victims to mail cash to aliases used by other members of the fraud network, including Patel and Dave.
As part of the tech support scam, callers allegedly induced victims to send money in exchange for supposed technical support for their computers. The callers then provided nothing in return. At times, callers misled the victims into providing remote access to their computers and the callers would access the victims’ bank accounts. The callers routinely misled the victims by making it appear as though the caller added money to the victims’ bank accounts. The callers then instructed the victims to mail cash to aliases used by other members of the fraud network, including Patel and Dave.
Based on misrepresentations made during the calls, the victims, including a number of Georgia residents, mailed money to a network of individuals that allegedly laundered funds on behalf of the overseas fraud network. From on or about May 2019, to on or about January 2020, Patel and Dave allegedly laundered over $400,000 sent by at least twenty-four victims of the scams.
On June 9, 2020, Mehulkumar Manubhai Patel, 36, and Chitali Dave, 36, both of Lexington, South Carolina, were charged by a federal grand jury with money laundering conspiracy and money laundering. Patel was arraigned on June 19, 2020 before U.S. Magistrate Judge Christopher C. Bly. Defendant Dave was arraigned on July 14, 2020 before U.S. Magistrate Judge Linda T. Walker.
Members of the public are reminded that the indictment only contains charges. The defendants are presumed innocent of the charges and it will be the government’s burden to prove the defendants’ guilt beyond a reasonable doubt at trial.
Separately, on July 9, 2020, the U.S. District Court Judge William M. Ray, II sentenced defendant Joish Patel to over two years in prison by for his role in a criminal India-based phone scam. In 2017, Patel picked up over $140,000 dollars in victim funds using fake IDs. Some victims in that case sent money to aliases used by Joish Patel in response to an IRS scam where callers claimed they owed taxes or would be arrested. Other victims were tricked into believing that they needed to send money in order to qualify for loans.
The Social Security Administration - Office of the Inspector General is investigating the Mehulkumar Manubhai Patel and Chitali Dave case, with the assistance of the U.S. Secret Service, Aiken Department of Public Safety (South Carolina), Naperville Police Department (Illinois), Lexington County Sheriff’s Department (South Carolina), Rocky River Police Department (Ohio), and Henrico County Police Division (Virginia). The U.S. Treasury Inspector General for Tax Administration (TIGTA) investigated the Joish Patel case.
Northern District of Georgia Elder Justice Coordinator and Assistant U.S. Attorney Jolee Porter and Special Assistant U.S. Attorney Diane Schulman are prosecuting the case.
The U.S. Attorney’s Office for the Northern District of Georgia is part of the Department of Justice Transnational Elder Fraud Strike Force. The Strike Force focuses on investigating and prosecuting defendants associated with foreign-based fraud schemes that disproportionately affect American seniors. These include romance scams, phone scams, mass-mailing fraud schemes, and tech-support fraud schemes. For further information on these scams, see https://www.justice.gov/elderjustice/senior-scam-alert.
The public should exercise caution with any caller who claims to be a government employee. Government agencies will never threaten you with immediate arrest or other legal action if you do not send cash, retail gift cards, wire transfers, or internet currency. They will also never demand secrecy from you in resolving a debt or any other problem. If you need to send a payment to Social Security, SSA will send a letter with payment options and appeal rights. If you suspect you have received a Social Security scam call, report it at https://oig.ssa.gov.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
California Couple in College Admissions Case Pleads GuiltyRead the Press Release
BOSTON – A California couple pleaded guilty today to conspiracy charges in connection with agreeing to pay $250,000 to secure the fraudulent admission of their daughter to the University of Southern California (USC) as a purported athletic recruit.
Diane Blake, 55, and Todd Blake, 54, both of Ross, Calif., pleaded guilty to one count of conspiracy to commit wire and mail fraud and honest services wire and mail fraud. Todd Blake also pleaded guilty to one count of conspiracy to commit money laundering. U.S. District Court Judge Nathaniel M. Gorton scheduled sentencing for Nov. 17, 2020.
Beginning in 2017, the Blakes conspired with William “Rick” Singer and others to facilitate their daughter’s admission to USC as a purported athletic recruit. Specifically, Singer had an athletic profile of their daughter created and sent to the USC athletic admissions committee, allegedly through co-conspirator Donna Heinel, then a USC athletics administrator. As a result, their daughter was allocated an athlete admission spot even though she was not actually recruited and did not play on the USC women’s volleyball team. The Blakes paid $50,000 to USC women’s athletics and $200,000 to Singer’s non-profit charity, The Key Worldwide Foundation, as a quid pro quo for the admission spot. The Blakes concealed this deal from USC personnel.
Under the terms of Diane Blake’s plea agreement, the parties have agreed to a sentence, subject to the Court’s approval, of six weeks in prison, a $125,000 fine and two years of supervised release with 100 hours of community service. Under the terms of Todd Blake’s plea agreement, the parties have agreed to a sentence, subject to the Court’s approval, of four months in prison, a $125,000 fine and two years of supervised release with 100 hours of community service.
Diane and Todd Blake are the 27th and 28th parents to plead guilty in the college admissions case.
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 and wire fraud and honest services mail and wire fraud provides for a sentence of up 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. The charge of conspiracy to commit money laundering provides for a sentence of up to 20 years in prison, three years of supervised release and a fine of $500,000 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; and Kristina O’Connell, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston made the announcement today. Assistant U.S. Attorneys Eric S. Rosen, Justin D. O’Connell, Leslie A. Wright, Kristen A. Kearney, Karin M. Bell and Stephen E. Frank of Lelling’s Criminal Division are prosecuting the case.
The details contained in the charging documents are allegations. The remaining defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Business Owner Sentenced to Prison for Tax EvasionRead the Press Release
PITTSBURGH, PA -- A resident of Sewickley, PA, has been sentenced in federal court in Pittsburgh, Pennsylvania, following his guilty plea on charges of tax evasion, United States Attorney Scott W. Brady announced today.
According to the information presented to the court, Mark Stanford evaded payment of both his personal income taxes and the employer and employee portions of Social Security and Medicare taxes that he should have paid by virtue of owning and operating a cleaning business during the period 2009 through 2013. At the same time he was evading the payment of his tax obligations he made large personal expenditures (such as Bentley and Mercedes Benz automobiles).
United States District Court Judge Cathy Bissoon sentenced Stanford to two years (24 months) in prison, a $4000 fine, three years of supervised release (upon his release from prison) and Stanford was ordered to pay more than $330,000 in back taxes.
The Internal Revenue Service, Criminal Investigation conducted the investigation leading to the indictment, plea and sentence in this case.
Buffalo Man Going to Prison for More Than 7 Years for Selling FentanylRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y. – U.S. Attorney James P. Kennedy, Jr. announced today that Torri McCray, 41, of Buffalo, NY, who was convicted of possessing with intent to distribute and distributing fentanyl and 10 grams of more of buytryl fentanyl was sentenced to serve 90 months in prison by U.S. District Judge Lawrence J. Vilardo.
Assistant U.S. Attorney Brendan T. Cullinane, who handled the case, stated that on four dates between June and August of 2017, the defendant distributed controlled substances, including heroin, fentanyl, U-47700, butyryl fentanyl, and furanyl fentanyl. On August 16, 2017, the Drug Enforcement Administration arrested McCray and recovered from him a quantity of heroin that he intended to distribute.
The sentencing is the culmination of an investigation on the part of the Drug Enforcement Administration, under the direction of Special Agent in Charge Ray Donovan, New York Field Division.
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Baltimore Felon Sentenced to Eight Years in Federal Prison for His Role in a Southwest Baltimore Drug Shop that Distributed Heroin, Fentanyl, and CocaineRead the Press Release
Baltimore, Maryland – U.S. District Judge George L. Russell, III today sentenced Raheem Benjamin, age 27, of Baltimore Maryland, to eight years in federal prison, followed by three years of supervised release, for conspiracy to distribute heroin.
The sentence was announced by United States Attorney for the District of Maryland Robert K. Hur; Assistant Special Agent in Charge Orville O. Greene of the Drug Enforcement Administration, Baltimore District Office; and Commissioner Michael Harrison of the Baltimore Police Department.
According to his guilty plea, from February 2018 through May 7, 2019, Benjamin and other co-conspirators agreed to distribute and possess with intent to distribute 400 grams or more of fentanyl for a drug trafficking organization (DTO) known as “Lex Luthor.” The Lex Luthor DTO operated 24 hours a day, 7 days a week as an open-air drug shop in southwest Baltimore, typically selling gel capsules containing a mixture of heroin, cocaine, and fentanyl. Benjamin’s responsibilities as a member of the DTO included distributing packs of these gel capsules to street-level distributors—who would then sell the gel capsules to paying customers—and collecting drug proceeds from those distributors in exchange for the packs.
On October 17, 2018, while monitoring surveillance from a pole camera, law enforcement saw Benjamin pull out a firearm. Officers with the Baltimore Police Department responded to arrest Benjamin, who fled, discarding the loaded firearm. Police immediately recovered the gun, a revolver loaded with six .22-caliber cartridges. Officers apprehended Benjamin shortly thereafter. Benjamin had a previous felony conviction and was prohibited from possessing a firearm or ammunition.
As a result of the Benjamin’s day-to-day activities obtaining and supplying street-level distributors with narcotics, as well as from his conversations with other co-conspirators and general familiarity with the drug shop’s operation, Benjamin knew that members of the DTO would take possession of and distribute more than 400 grams of fentanyl.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Project Safe Neighborhoods (PSN) is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
This case is also part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see: https://www.justice.gov/projectguardian.
United States Attorney Robert K. Hur commended the DEA and the Baltimore Police Department for their work in the investigation. Mr. Hur thanked Assistant U.S. Attorney Michael Goldsticker, who prosecuted the case.
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Audubon County Resident Sentenced for being a Drug User in possession of firearmRead the Press Release
COUNCIL BLUFFS, Iowa - United States Attorney Marc Krickbaum announced on July 8, 2020, Brandon Michael Barringer, age 36, of Audubon, was sentenced to two years in prison followed by two years of supervised release by United States District Court Senior Judge James E. Gritzner for being a drug user in possession of a firearm. Barringer pleaded guilty to the offense on March 6, 2020.
The sentencing was the result of an incident in Audubon on November 15, 2019. Barringer removed a .40 caliber rifle from his car and threatened an individual with the rifle after a domestic disturbance. Barringer then left Audubon and was located by law enforcement in Carroll County, where the rifle was recovered along with ammunition. Barringer is a long time user of methamphetamine.
The case was investigated by the Audubon Police Department, Audubon County Sheriff’s Office, Carroll Police Department, Carroll County Sheriff’s Office, and the Iowa Division of Narcotics Enforcement. The case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
Attorney Sentenced to Federal Prison for Obstruction of Justice OffensesRead the Press Release
Tampa, Florida – U.S. District Judge Mary S. Scriven today sentenced Nelson Israel Alfaro (49, Miami) to 14 months in federal prison for conspiring to defraud the United States, obstruction of justice, and making false statements to federal law enforcement officers. The court also ordered Alfaro to forfeit $117,500 to the United States, the proceeds of his related crimes.
Alfaro had pleaded guilty on December 13, 2019.
According to court documents, Alfaro was an attorney who represented criminal defendants in Florida federal and state courts, including the United States District Court for the Middle District of Florida. From early 2017 to August 2019, Alfaro and his former client, Gilberto De Los Rios, concocted a scheme to charge an already-sentenced federal defendant tens of thousands of dollars for information that they then falsely and fraudulently presented to the United States as the defendant’s “cooperation” and “substantial assistance,” in order to trigger a sentence reduction for the defendant.
To achieve this sentence reduction, Alfaro concocted a plan to purchase information that would be of interest to law enforcement, which the federal defendant could falsely claim as his own cooperation. Alfaro planned to charge the federal defendant $50,000 as Alfaro’s personal fee for this effort, and an additional $30,000 to pay for the information that would earn the federal defendant substantial assistance credit. Alfaro’s scheme required him to enlist the aid of another person known to him, but unknown to the federal defendant—De Los Rios, whom Alfaro had represented regarding Florida state criminal charges in 2010-2011.
Over time, Alfaro’s plan transformed into a plot to earn the federal defendant substantial assistance credit by paying De Los Rios to cooperate on behalf of the federal defendant. In doing so, Alfaro fabricated a story about the relationship between De Los Rios and the federal defendant, about which he repeatedly lied and provided false and fraudulent information to federal law enforcement agents.
This case was investigated by the Federal Bureau of Investigation. It was prosecuted by Assistant United States Attorney Josephine W. Thomas.
Another Houston man charged with COVID relief fraudRead the Press Release
HOUSTON - A local man has been taken into custody on allegations he fraudulently obtained more than $1.1 million in Paycheck Protection Program (PPP) loans, announced U.S. Attorney Ryan K. Patrick and Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division.
Joshua Thomas Argires, 29, Houston, is charged in a criminal complaint with making false statements to a financial institution, wire fraud, bank fraud and engaging in unlawful monetary transactions.
Argires allegedly perpetrated a scheme to file two fraudulent loan applications seeking more than $1.1 million in forgivable loans. The Small Business Administration (SBA) guarantees the loans for COVID-19 relief through the PPP under the Coronavirus Aid, Relief and Economic Security (CARES) Act.
The complaint alleges Argires submitted two fraudulent PPP loan applications to federally insured banks. One of these applications was submitted on behalf of an entity called Texas Barbecue; the other was filed on behalf of a company called Houston Landscaping. Argires allegedly claimed these two companies had numerous employees and hundreds of thousands of dollars in payroll expenses.
According to the complaint, neither Texas Barbecue nor Houston Landscaping has employees or pays wages consistent with the amounts claimed in the PPP loan applications. The complaint further asserts that both of these loans were funded, but that none of the funds were used for payroll or other expenses authorized under the PPP. Rather, the funds received on behalf of Texas Barbecue were invested in a cryptocurrency account, while the funds obtained for Houston Landscaping were held in a bank account and slowly depleted via ATM withdrawals, according to the charges.
The CARES Act is a federal law enacted March 29. It is designed to provide emergency financial assistance to millions of Americans who are suffering the economic effects resulting from the COVID-19 pandemic. One source of relief the CARES Act provides is the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses through the PPP. In April 2020, Congress authorized over $300 billion in additional PPP funding.
The PPP allows qualifying small businesses and other organizations to receive loans with a maturity of two years and an interest rate of one percent. Businesses must use PPP loan proceeds for payroll costs, interest on mortgages, rent and utilities. The PPP allows the interest and principal to be forgiven if businesses spend the proceeds on these expenses within a set time period and use at least a certain percentage of the loan towards payroll expenses.
The Federal Housing Finance Agency - Office of the Inspector General (OIG), SBA - OIG and U.S. Postal Inspection Service’s Houston Division conducted the investigation. Trial Attorney Timothy A. Duree of the Criminal Division’s Fraud Section and Assistant U.S. Attorney James McAlister for the Southern District of Texas 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.
A federal criminal complaint is merely an accusation. A defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Albany Felon Pleads Guilty to Possessing a HandgunRead the Press Release
ALBANY, NEW YORK – Saul McDuffie, age 33, of Albany, pled guilty today to being a felon in possession of a firearm. The announcement was made by United States Attorney Grant C. Jaquith; Kevin Kelly, Special Agent in Charge of the Buffalo Field Office of Homeland Security Investigations (HSI); and Chief Eric Hawkins of the Albany Police Department.
In pleading guilty, McDuffie admitted to possessing a loaded Taurus handgun, which he placed on the tire of a car parked on North Swan Street in Albany, on October 28, 2019. McDuffie has multiple prior felony convictions, including two convictions for drug offenses, for which he was sentenced to a total of over six years in prison, and a burglary conviction, for which he was sentenced to two to six years in prison.
At sentencing, McDuffie faces a maximum sentence of 10 years in prison, a fine of up to $250,000, and a term of supervised release of up to 3 years. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines and other factors.
This case was investigated by the Albany Police Department and Homeland Security Investigations, and is being prosecuted by Assistant U.S. Attorneys Cyrus P.W. Rieck and Rachel L. Williams.
13 Defendants Charged in Second Phase of Federal Investigation Targeting Heroin Trafficking on West Side of ChicagoRead the Press Release
CHICAGO — Thirteen individuals are facing criminal charges as part of the second phase of a federal investigation into heroin trafficking on the West Side of Chicago.
The 13 new defendants allegedly participated in a drug trafficking operation that was responsible for distributing at least 25 kilograms of heroin to individual customers in Chicago from at least February 2019 until earlier this month, when law enforcement shut down the operation. The street-level sales occurred at two open-air drug markets in the city’s Austin neighborhood.
The charges are the result of the second phase of “Operation Dirty Ice,” a multi-agency investigation led by the FBI, IRS Criminal Investigation Division, and Chicago Police Department. The first phase of the probe led to drug conspiracy charges against eleven other defendants in October 2018. Operation Dirty Ice was conducted in collaboration with the Organized Crime Drug Enforcement Task Force (OCDETF), whose principal mission is to identify, disrupt, and dismantle the most serious drug trafficking organizations.
During the probe, authorities seized three kilograms of heroin, 500 grams of crack cocaine, approximately $1.1 million in illicit cash proceeds, five handguns, and a rifle.
A criminal complaint filed in U.S. District Court in Chicago charges the 13 new defendants with conspiracy to possess a controlled substance with the intent to distribute. All of the defendants have made initial appearances in federal court in Chicago.
The charges were announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI; Kathy A. Enstrom, Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago; and David Brown, Superintendent of CPD. Assistant U.S. Attorneys Kelly Guzman and Kaitlin Klamann represent the government.
The newly charged defendants are CLIFTON COLEMAN, 45, of Westchester; TARRENCE WATSON, 45, of Bellwood; BERNARD ROWSEY, 42, of Chicago, and his brother, RODNEY ROWSEY, 41, of Chicago; CHARLES ARMSTRONG, 55, of Chicago; DEXTER JONES, 48, of Chicago; VERNON EDWARDS, 49, of Chicago; LAVERIC DAWSON, 36, of Chicago; KEITH MOORE, 49, of Oak Park; ERIC BERNARD, 53, of Chicago; KENNETH BOWDRY, 57, of Chicago; BRYAN LANDFAIR, 58, of Chicago; and MORRIS SIMMONS, 59, of Chicago.
According to the charges, Coleman led a drug trafficking organization that obtained and distributed 800 to 1,000 grams of heroin in the Chicago area on a weekly basis. Coleman’s crew used two stash houses to mix the heroin with other substances, including sleeping pills, in preparation for street-level distribution, the complaint states. During the investigation, law enforcement observed numerous hand-to-hand purchases of heroin at the two open-air drug markets, located near the intersections of Chicago and Lavergne Avenues, and Chicago and Pine Avenues. Police also coordinated undercover purchases of heroin at the markets, the complaint states.
The public is reminded that a complaint only contains a charge and 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.
Monday 13 July 2020
Wood County Man Pleads Guilty to Embezzling from Labor UnionRead the Press Release
CHARLESTON, W.Va. – A Wood County man pled guilty today to a charge of embezzling from a union, announced United States Attorney Mike Stuart. Rick Drain, 56, of Vienna, pled guilty to one count of embezzling from a labor union.
“You can’t make up story lines like this - a man named Drain draining the union of its hard earned money solely for personal greed,” said United States Attorney Mike Stuart. “These union members deserved far better. These terrible acts of greed happen far too often.”
Drain faces up to five years in prison when sentenced on October 15, 2020.
Drain was the business manager of a local union and used his position to defraud the union. Law enforcement learned that Drain had defrauded the union of approximately $50,000 by collecting dues and other fees from union members and keeping the money for himself, not depositing it into the union’s bank account. The Department of Labor, through its Office of Labor Management Standards, conducted the investigation. United States District Judge Joseph R. Goodwin presided over the plea hearing. Assistant United States Attorney Kathleen Robeson is handling the prosecution.
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Washington, D.C. General Contractor Charged with COVID-Relief FraudRead the Press Release
The owner of a residential construction contracting firm based in Washington, D.C., was charged with allegedly submitting fraudulent documents to a bank in connection with applications seeking more than $400,000 in a forgivable Paycheck Protection Program (PPP) loans guaranteed by the Small Business Administration (SBA) under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division, Acting U.S. Attorney Michael R. Sherwin for the District of Columbia, Special Agent in Charge James A. Dawson of the FBI Washington Field Office’s Criminal Division, Inspector General Hannibal “Mike” Ware of the Small Business Administration's Office of Inspector General (SBA OIG), and J. Russell George, the Treasury Inspector General for Tax Administration (TIGTA) made the announcement.
Oludamilare Olugbuyi, 40, of Washington, D.C., was charged in a federal criminal complaint filed in the District of Columbia with making false statements to a financial institution. According to the complaint, Olugbuyi submitted several fake and fraudulent documents to a financial institution in support of two PPP loan applications seeking more than $400,000 in forgivable loans for a construction firm that he owned. Specifically, Olugbuyi submitted what purported to be several IRS Forms 1099-MISC reporting hundreds of thousands of dollars in disbursements made to independent contractors.
The complaint alleges that the social security numbers reflected on the forms were either invalid or assigned to other people. In addition, Olugbuyi allegedly submitted to the financial institution what purported to be a tax return reporting $175,565 in adjusted gross income for tax year 2019. According to IRS records, however, on April 14, 2020, Olugbuyi filed an IRS Form 1040 reporting $1 in total income for 2019. This document, known as a “non-filer return,” qualified Olugbuyi to receive a $1,200 Coronavirus Aid, Relief, and Economic Security Act (CARES) economic impact payment.
The CARES Act is a federal law enacted on March 29, 2020, designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. One source of relief provided by the CARES Act was the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses, through the PPP. In April 2020, Congress authorized over $300 billion in additional PPP funding.
The PPP allows qualifying small businesses and other organizations to receive loans with a maturity of two years and an interest rate of 1 percent. PPP loan proceeds must be used by businesses on payroll costs, interest on mortgages, rent, and utilities. The PPP allows the interest and principal on the PPP loan to be entirely forgiven if the business spends the loan proceeds on these expense items within a designated period of time after receiving the proceeds and uses a certain amount of the PPP loan proceeds on payroll expenses.
A federal criminal complaint is merely an accusation. A defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Deputy Chief Brian R. Young of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Christine Macey are prosecuting the case. The Justice Department acknowledges and thanks the FBI, TIGTA, and the SBA OIG for their efforts investigating this matter.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Washington State Felon Arrested in the Bay Area for Possessing an Assault RifleRead the Press Release
OAKLAND – James David Allen II made an initial appearance today in federal court on a criminal complaint for being a felon in possession of a firearm and ammunition, after police arrested him on July 8, 2020, announced United States Attorney David L. Anderson and Federal Bureau of Investigation Special Agent in Charge John F. Bennett. Allen made his initial appearance in federal court today before Magistrate Judge Sallie Kim.
According to the complaint, Allen, a resident of Washington State, was found sleeping in a stolen car in Pinole on the morning of July 8, 2020. After confirming that the vehicle was stolen, officers arrested Allen and conducted an inventory search of the vehicle.
The complaint alleges that on the front passenger floorboard of the vehicle, officers found a loaded AR-15 style rifle with handwritten numbers and words all over it. The rifle was pointed barrel down with the rear stock leaning against the front edge of the passenger seat, making it immediately accessible to the driver’s hand. It was equipped with a loaded, high-capacity 30-round magazine. Upon taking possession of the rifle, the arresting officers found a live round chambered and the fire control switch set to “fire.” A second loaded, high-capacity 30-round magazine was taped to this magazine. The second magazine was positioned opposite so that the shooter could drop the first magazine from the rifle and easily flip it over to insert the other loaded magazine. A third loaded, high capacity magazine was found in the trunk of the vehicle.
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.
Michael A. Rodriguez is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Kay E. Konopaske. The prosecution is the result of an investigation by the Federal Bureau of Investigation and the Pinole Police Department.
United States Attorney William M. McSwain Announces Launch of Violent Crime Prevention and Public Awareness CampaignRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced the launch of a public awareness campaign aimed at discouraging violent crime, specifically robbery and gun crimes, throughout the Eastern District of Pennsylvania. The campaign employs targeted messaging to educate and inform the public that crimes committed with a gun can often violate federal laws, and therefore carry stiffer potential penalties than crimes prosecuted under local and state statutes. One component of the campaign is a series of public service announcements (PSAs) that will run on television, radio, and streaming platforms urging individuals to rethink committing violent crimes that could be federal offenses.
For example, under a federal statute called the Hobbs Act, passed by the United States Congress in 1946, it is a federal crime to use force or threats of force to rob a commercial business – like a pharmacy, a convenience store, or even a corner market. It does not matter whether the robber steals thousands of dollars from the cash register or nothing more than a pack of cigarettes. Because these stores operate in “interstate commerce,” the U.S. Attorney’s Office can take these cases federally. And that is exactly what it will do to get justice for the victims in these cases – store owners and their patrons who live in fear in their neighborhoods.
Violent crime, particularly gun crime, has become a pervasive issue in Philadelphia and other parts of the Eastern District of Pennsylvania. For example, in 2019, 2,181 robberies with a gun occurred in Philadelphia. So far in 2020, there have been 219 homicides, with the past two weekends in July becoming particularly violent. The U.S. Attorney’s Office has committed to a strong response to violent crime in this District. Part of that response has been to increase the number of violent crime prosecutions: in 2019, the Violent Crime Unit of the U.S. Attorney’s Office charged 53% more cases than in the previous year. Another part of the Office’s response is deterrence: the primary goal of this public awareness campaign is to put potential offenders and the community on notice and reduce violent crime throughout the District. The campaign will appear in Philadelphia and its surrounding collar counties, and will also reach audiences in Lancaster, Berks, Lehigh and Northampton counties.
The campaign will focus on informing the public of the legal consequences of committing a federal violent crime and thereby discourage potential perpetrators of violence and gun crimes by raising awareness of the potential for federal jail time. The slogan “Fed Crime Gets Fed Time,” accompanied by #FedCrimeGetsFedTime, will be deployed across social media platforms, traditional media, and public service announcements on television and radio in communities throughout the District’s nine counties.
“When criminals think there are no consequences for their actions, serious violent crime rises. That is the root of the crisis we are facing in Philadelphia today,” said U.S. Attorney McSwain. “Anyone who commits a federal violent crime in the Eastern District of Pennsylvania will feel the full force of the law. My message to would-be criminals is simple: put the guns down and think about your future.”
For more information and to see the campaign materials, visit the “Fed Crime Gets Fed Time” website.
U.S. Marshals Service Investigation Referred to Department of Justice Office of the Inspector GeneralRead the Press Release
PORTLAND, Ore.—U.S. Attorney Billy J. Williams released the following statement regarding the U.S. Marshals Service use of less-lethal munitions during weekend protests:
“Per U.S. Marshals Service protocols, their internal investigation of this weekend’s incident has now been referred to the Department of Justice Office of the Inspector General. We must respectfully decline further comment on this matter.”
U.S. Attorney’s Office Shuts Down Multiple Websites Claiming to Offer Preorders for COVID-19 VaccineRead the Press Release
LOUISVILLE, Ky. – United States Attorney Russell Coleman today announced that the U.S. Attorney’s Office for the Western District of Kentucky has filed a lawsuit in federal court in Louisville, Kentucky to shut down a webpage, six related web addresses and a related Facebook page that the suit says are attempting to lure consumers to “pre-register” for a non-existent COVID-19 vaccine in exchange for $100 worth of Bitcoin (“BTC”), a type of cryptocurrency. The lawsuit names Luke John Flint, of Louisville, Kentucky, doing business through “coronavaccine.center”, “coronavaccine.today”; “coronatesting.site”; “coronatesting.center”; “coronavaccine.shop”; “coronavaccine.club”; and “covid19vaccine.center. Today a federal judge entered an order prohibiting Flint and others associated with the websites from committing wire fraud, maintaining and doing business through the websites and social media, and destroying business records.
According to the civil complaint, the purpose of these websites, which contain several false statements, is to induce victims to pay Flint and those working in concert with him for a non-existent vaccine for COVID-19 amid the global pandemic. There is currently no known FDA approved COVID-19 vaccine. The website and related Facebook page lists the Corona Vaccine Center’s address as 545 South Clay Street, Louisville, KY, which is nothing more than an empty parking lot/field.
The civil complaint further alleges that Flint is not a licensed medical professional and he is not registered with the FDA to investigate or develop a COVID-19 vaccine, and as such, he could not legally distribute a vaccine. When interviewed by federal agents, Flint admitted that there is no known FDA approved vaccine for COVID-19 and that he is unaware if and when one would become available. During this interview, Flint also admitted that he is not a licensed medical professional and is not registered with the FDA to distribute a vaccine for COVID-19, if and when one becomes available.
“Seeking to profit during a global pandemic by offering false hope is both foul and flat out puts vulnerable people at risk,” said U.S. Attorney Russell Coleman. “We will pursue every available legal tool in our toolkit to swiftly put an end to such predatory conduct.”
Flint has signed an agreed injunction, agreeing that the “United States can establish by a preponderance of the evidence that Defendant is about to violate or is violating” the federal wire fraud statute.
The case is styled United States of America v. Luke John Flint, 3:20-cv-489-CHB. Assistant United States Attorneys Nicole Elver and William F. Campbell are handling the case. The investigation was conducted by the Department of Homeland Security, Immigration and Customs Enforcement, Homeland Security Investigations (HSI).
If you think you are a victim of a scam or attempted fraud involving COVID-19, you can report it without leaving your home by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
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U.S. Attorney Trent Shores’ Statement Regarding Possible Federal Actions in Cases Affected by the Supreme Court’s Ruling in McGirt v OklahomaRead the Press Release
U.S. Attorney Trent Shores has made the following statement:
“The United States Attorney’s Office for the Northern District of Oklahoma has received a number of media inquiries about its anticipated actions in a variety of state cases that have been or may be dismissed as a result of the Supreme Court’s McGirt decision, including the recently dismissed case State of Oklahoma v. Dustin Dennis. First, as a general matter, the United States does not comment on pending investigations. We do our utmost to protect the integrity and confidentiality of federal Grand Jury proceedings, consistent with Federal Rules of Criminal Procedure. Second, let there be no doubt that my team of federal prosecutors, legal support staff, victim specialists, and administrative staff are working around the clock right now to pursue justice and help victims of crime. We are doing so in partnership with tribal, state, and federal law enforcement agencies as well as with the Tulsa County and Creek County District Attorneys and the Muscogee (Creek) Attorney General. We want to ensure the citizens of northeastern Oklahoma continue to receive seamless public safety services. Oklahomans have always been good about working together to achieve a common goal. Since the McGirt decision came down, I’ve seen just that – Oklahomans working together to promote continued public safety in this new jurisdictional landscape.”
Twenty-Seven Skilled Nursing Facilities Controlled by Longwood Management Corporation to Pay $16.7 Million to Resolve False Claims Act AllegationsRead the Press Release
Longwood Management Corporation and 27 affiliated skilled nursing facilities (Longwood) have agreed to resolve allegations that they violated the False Claims Act by submitting false claims to Medicare for rehabilitation therapy services that were not reasonable or necessary, the Department of Justice announced today. Longwood is headquartered in California and the 27 skilled nursing facilities are also located in California.
“This settlement reflects the Department’s continuing commitment to ensure that patients are receiving individualized healthcare services appropriate to their specific medical needs,” said Acting Assistant Attorney General Ethan P. Davis for the Department of Justice’s Civil Division. “When skilled nursing facilities provide rehabilitation therapy services based on maximizing revenue rather than the interests of their patients, we will hold them accountable.”
“Longwood’s business plan called for substantial revenue from Medicare, and it pressured therapists to provide additional, unnecessary services when targets were not met,” said U.S. Attorney Nick Hanna for the Central District of California. “This case demonstrates the power of whistleblowers to shine a light on improper business practices and obtain significant recoveries on behalf of United States taxpayers.”
The settlement resolves allegations that Longwood submitted false claims for rehabilitation therapy by engaging in a systematic effort to increase Medicare billings. Medicare reimburses skilled nursing facilities at a daily rate that reflects the skilled therapy and nursing needs of qualifying patients. The greater the patient’s needs, the higher the level of Medicare reimbursement. The highest level of Medicare reimbursement for skilled nursing facilities is for “Ultra High” therapy patients, who require a minimum of 720 minutes of skilled therapy from two therapy disciplines (e.g., physical, occupational, or speech therapy), one of which has to be provided five days a week.
Longwood allegedly knowingly submitted or caused the submission of false and fraudulent claims to Medicare for medically unreasonable and unnecessary Ultra High levels of rehabilitation therapy for Medicare Part A residents. Specifically, Longwood allegedly pressured therapists to increase the amount of therapy provided to patients to meet pre-planned targets for Medicare revenue. These targets were alleged to have been set without regard to patients’ individual therapy needs and could only be achieved by billing for a high percentage of patients at the Ultra High level.
The settlement covers conduct that occurred from May 1, 2008 through Aug. 1, 2012 at six facilities (Alameda Care Center, Burbank Rehabilitation Center, Magnolia Gardens Convalescent Hospital, Montrose Healthcare Center, Sherman Oaks Health & Rehab Center, and West Hills Health & Rehab Center); and from Jan. 1, 2006 through Oct. 10, 2014 at twenty-one facilities (Burlington Convalescent Hospital, Chino Valley Rehabilitation Center LLC, Colonial Care Center, Covina Rehabilitation Center, Crenshaw Nursing Home, Green Acres Lodge, Imperial Care Center, Imperial Crest Health Care Center, Laurel Convalescent Hospital, Live Oak Rehabilitation Center, Longwood Manor Convalescent Hospital, Monterey Care Center, Intercommunity Healthcare Center, Park Anaheim Healthcare Center, Pico Rivera Healthcare Center, San Gabriel Convalescent Center, Whittier Pacific Care Center, Studio City Rehabilitation Center, Sunnyview Care Center, View Park Convalescent Center, Western Convalescent Hospital).
Contemporaneous with the civil settlement, Longwood has entered into a five-year Corporate Integrity Agreement with the Department of Health and Human Services Office of Inspector General (HHS-OIG) that requires an independent review organization to annually assess the medical necessity and appropriateness of therapy services billed to Medicare.
“The government contended Longwood falsely claimed medically unreasonable and unnecessary levels of rehabilitation services at the expense of taxpayers,” said Timothy B. DeFrancesca, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services. “My agency’s compliance agreement is designed to monitor claims to Medicare and prevent submission of false claims in the future.”
The settlement partially resolves allegations brought in two lawsuits filed by whistleblowers under the qui tam provisions of the False Claims Act, which allows private parties to bring suit on behalf of the government and to share in any recovery. The whistleblowers, Judy Boyce, Benjamin Monsod, and Keith Pennetti will collectively receive $3,006,000 of the settlement proceeds.
The settlement was the result of a coordinated effort by the Civil Division of the Department of Justice, the U.S. Attorney’s Office for the Central District of California, the U.S. Attorney’s Office for the Northern District of Alabama, and the U.S. Department of Health and Human Services Office of Inspector General.
The cases are captioned United States ex rel. Pennetti v. Longwood Management Corp., et al., Case Number CV-14-4133 (C.D. Cal.), and United States ex rel. Boyce, Judy and Monsod, Benjamin v. Aegis Therapies, Inc., GGNSC Holdings LLC, and Longwood Management Corp., CV-16-8050 (C.D. Cal.). The claims resolved by this agreement are allegations only and there has been no determination of liability.
Tulsa Man charged for Murder Occurring on Creek Nation LandRead the Press Release
A Tulsa man has been charged with murder in the first degree in Indian Country after he allegedly shot and killed a woman in Philpott Park on July 10, 2020.
According to a Criminal Complaint, James Michael Landry, 29, committed the crime on the Creek Nation reservation. The victim was an enrolled member of the Cherokee Nation.
“The United States Attorney’s Office is pursuing this case consistent with our new responsibilities following the Supreme Court’s McGirt decision,” said U.S. Attorney Trent Shores. “The cooperation among tribal, local, state, and federal law enforcement is as strong as ever in northeastern Oklahoma. In this case, investigators with the Federal Bureau of Investigation, Tulsa Police Department, and Muscogee (Creek) Nation Lighthorse were on the scene and working together. In this case and others that may now fall under federal jurisdiction, the U.S. Attorney’s Office will uphold its trust responsibility in the public safety arena. As always, we will seek to hold accountable criminal wrongdoers and pursue justice for victims in United States District Court.”
According to the Criminal Complaint and affidavit, Tulsa police officers and emergency personnel arrived at Philpott Park in response to a 911 call. The caller stated that a man had requested help because his girlfriend was going to die. At the scene, first responders observed James Michael Landry, 29, standing over a woman lying on the ground. Because Landry was making conflicting statements and acting strange he was put in investigative detention. Upon processing the scene, the medical examiner discovered what appeared to be a shotgun wound to the head. Detectives located a double barrel shotgun hidden under sticks next to a tree near the crime scene. During an interview with police, Landry allegedly admitted that the shotgun belonged to him and that he had pointed it at the victim on days prior to the crime as well as the day of the crime. He also allegedly claimed that the victim put the gun in her own mouth on the day of the crime as he held the firearm and they argued. He claimed the gun was fired unintentionally.
A Criminal Complaint is a temporary charge alleging a violation of law. For the case to proceed to trial, the United States must present the charge to a federal Grand Jury within 30 days. Once a Grand Jury returns an Indictment, a defendant has a right to a jury trial at which the United States would have the burden of proving the defendant’s guilt beyond a reasonable doubt.
The charges were filed today in federal court due to the Supreme Court’s recent ruling in the case of McGirt v. Oklahoma. As a result of the Court’s ruling, all major crimes occurring on the Creek Nation reservation and involving Native American defendants and/or victims are required, by law, to be tried in federal court.
Landry was remanded into the custody of the U.S. Marshals Service and is scheduled for a preliminary hearing at 2 p.m. CDT on July 16.
The FBI, Muscogee (Creek) Nation Lighthorse Police Department and Tulsa Police Department are the investigative agencies. Assistant U.S. Attorney Ryan M. Roberts is prosecuting the case.
The U.S. Attorney’s Office and the IRS Criminal Investigation Remind Taxpayers of Upcoming Tax Filing Deadline; Urge Taxpayers to Remain Vigilant of ScamsRead the Press Release
Fort Smith, Arkansas – David Clay Fowlkes, Acting United States Attorney for the Western District of Arkansas and the Internal Revenue Service Criminal Investigation division reminded taxpayers of the July 15 filing and payment deadline and warned against an increase in tax and COVID-19 scams.
Due to COVID-19, the original filing deadline and tax payment due date for 2019 was postponed from April 15 to July 15. Taxpayers filing Form 1040 series returns must file Form 4868 by July 15 to obtain the automatic extension to Oct. 15.
As the filing deadline approaches, taxpayers should beware of tax and COVID-19 related scams. “Criminals use the tax filing deadline as an opportunity to steal personal and financial information”, said Acting U.S. Attorney David Clay Fowlkes for the Western District of Arkansas. “Taxpayers should remain vigilant and know that the IRS will not initiate contact with them via phone, email or social media to request personal or financial information.”
“Although the extension provides additional time to file the tax return – it is not an extension to pay any taxes due”, said Tamera Cantu, Special Agent in Charge of IRS-CI’s Dallas Field Office. “For people facing hardships who cannot pay in full, including those affected by COVID-19, the IRS has several options available to help. The IRS encourages taxpayers to visit IRS.gov as soon as possible to explore these options and avoid accruing interest and penalties after the July 15 deadline.”
In the last few months, the IRS Criminal Investigation division (CI) has continued to see a tremendous increase in a variety of Economic Impact Payment scams and other financial schemes. CI continues to work with its law enforcement partners to put a stop to these schemes and bring criminals to justice.
Taxpayers can report COVID-19 scams to the National Center for Disaster Fraud. Taxpayers can also report fraud or theft of their Economic Impact Payments to the Treasury Inspector General for Tax Administration (TIGTA). Unsolicited (phishing) e-mails that appear to be from the IRS should be forwarded to [email protected].
For the most up-to-date information about the tax filing deadline and IRS impersonation scams, taxpayers can visit IRS.gov.
Texas Man Charged with Assaulting Deputy U.S. Marshal with Hammer During Weekend Protests in Portland (Photo)Read the Press Release
PORTLAND, Ore.—U.S. Attorney Billy J. Williams announced today that a Texas man has been charged with assaulting a U.S. Marshals Service deputy with a construction hammer during weekend protests at the Mark O. Hatfield U.S. Courthouse in downtown Portland.
Jacob Michael Gaines, 23, a Texas man currently residing in a recreational vehicle in Portland, has been charged by criminal complaint with one count of assaulting a federal officer.
According to court documents, at approximately 1:00am on July 11, 2020, Gaines was observed using a hammer to damage a barricaded entrance at the Hatfield Federal Courthouse. At the time, federal law enforcement personnel were staged inside the courthouse to protect the facility and respond to incidents. Law enforcement attempted to exit the courthouse to prevent Gaines from breaching the barricaded entrance.
While attempting to detain him, Gaines struck a U.S. Marshals Service deputy three times with the hammer. The deputy deflected the blows to prevent serious injury, but in process was struck in the left shoulder, lower neck, and upper back. While being struck, the deputy managed to hold onto Gaines while other officers handcuffed him and placed him under arrest.
Gaines made his initial appearance in federal court today before a U.S. Magistrate Judge and was released pending further proceedings.
The case is being investigated by the U.S. Marshals Service and Federal Protective Service. It is being prosecuted by the U.S. Attorney’s Office for the District of Oregon.
A criminal complaint is only an accusation of a crime, and a defendant is presumed innocent unless and until proven guilty.
For several weeks, the Hatfield Federal Courthouse has been a repeated target of vandalism during evening protests and riots, sustaining extensive damage. U.S. Marshals Service deputies and officers from the Federal Protective Service, Homeland Security Investigations, and U.S. Customs and Border Protection working to protect the courthouse have been subjected to nightly threats and assaults from demonstrators while performing their duties.
Deputy U.S. Marshal approaching Gaines Gaines outside courthouse barricade with hammer in right hand Courthouse barricade with hole from Gaines' hammer strikes 4 lb DeWalt construction hammer seized from GainesTampa Man Arrested for Burning A Building During Civil Disturbance in TampaRead the Press Release
Tampa, Florida – United States Attorney Maria Chapa Lopez announces the arrest of Terrance Lee Hester, Jr. ( 20, Tampa) based on a criminal complaint for damaging or destroying by fire a building used in interstate commerce. Hester surrendered to federal authorities in Oswego, New York. After an initial appearance on Friday afternoon in the Northern District of New York, Hester remains in custody. If convicted, Hester faces a minimum mandatory penalty of 5 years, up to 20 years, in federal prison.
According to the
complaint , on May 30 and May 31, 2020, a protest near a shopping plaza located at 2301 East Fowler Avenue in Tampa devolved into civil unrest, looting, and destruction of property. During this disturbance, the Champs Sports store in the shopping plaza was set on fire. The building became fully engulfed in fire, resulting in major damage to the building and the loss of property. The estimated loss to the building, the Champs Sports store, and other businesses in the plaza is approximately $1.25 million.Video footage obtained by investigators revealed that Hester was one of the individuals participating in the civil disturbance, and that he tossed a flaming piece of cloth into the Champs store through a broken window. Fire investigators determined that the fire originated inside the Champs store and that Hester’s act caused or contributed to the cause of the fire.
A complaint is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case is being investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Tampa Police Department, and Tampa Fire Rescue. It will be prosecuted by Assistant United States Attorney Michael Sinacore.
St. Thomas Airport Passenger Departing for California Arrested at Cyril E. King Airport for Illegal Re-EntryRead the Press Release
St. Thomas, USVI – United States Attorney Gretchen C.F. Shappert for the District of the Virgin Islands announced today that Gilberto Arana Wence was arrested on July 10, 2020 and charged with illegal re-entry by a removed alien.
According to court documents, Wence was departing St. Thomas for Charlotte, North Carolina and then on to San Francisco, California when U.S. Customs and Border Protection officers determined he was not lawfully present in the United States. Based on record checks conducted using Wence’s fingerprints, officers discovered that he had previously been removed from the United States under a different name.
An initial appearance in federal court occurred on July 13, 2020.
The case is being investigated by Homeland Security Investigations and U.S. Customs and Border Patrol. It is being prosecuted by Assistant U.S. Attorney Adam Sleeper.
United States Attorney Gretchen C.F. Shappert reminds the public that a criminal complaint is merely a formal charging document and is not evidence of guilt. Every defendant is presumed innocent until and unless proven guilty.
South Florida U.S. Attorney’s Office and IRS-Criminal Investigation Remind Taxpayers of Upcoming Tax Filing Deadline; Urge Taxpayers to Remain Vigilant of ScamsRead the Press Release
MIAMI, Florida -- Ariana Fajardo Orshan, U.S. Attorney for the Southern District of Florida, and Michael J. De Palma, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), Miami Field Office, remind taxpayers of the July 15 filing and payment deadline and warned against an increase in tax and COVID-19 scams.
Due to COVID-19, the original filing deadline and tax payment due date for 2019 was postponed from April 15 to July 15. Taxpayers filing Form 1040 series returns must file Form 4868 by July 15 to obtain the automatic extension to Oct. 15.
Although the extension provides additional time to file the tax return – it is not an extension to pay any taxes due. For people facing hardships who cannot pay in full, including those affected by COVID-19, the IRS has several options available to help. The IRS encourages taxpayers to visit IRS.gov as soon as possible to explore these options and avoid accruing interest and penalties after the July 15 deadline.
As the filing deadline approaches, taxpayers should beware of tax and COVID-19 related scams. “Taxpayers cannot let their guard down,” said Ariana Fajardo Orshan, U.S. Attorney for the Southern District of Florida. “This tax season is particularly attractive to criminals because it coincides with the COVID-19 pandemic, which has placed many people in vulnerable positions.”
“Taxpayers should remain vigilant in the handling of their personal and financial information as criminals use this as an opportunity to take advantage of vulnerabilities,” said Michael J. De Palma Special Agent in Charge of the IRS Criminal Investigation division in Florida. “IRS-CI will continue to pursue these crimes and the perpetrators will be brought to justice.”
In the last few months, the IRS Criminal Investigation division (CI) has continued to see a tremendous increase in a variety of Economic Impact Payment scams and other financial schemes. CI continues to work with its law enforcement partners to put a stop to these schemes and bring criminals to justice.
Taxpayers can report COVID-19 scams to the National Center for Disaster Fraud. Taxpayers can also report fraud or theft of their Economic Impact Payments to the Treasury Inspector General for Tax Administration (TIGTA). Unsolicited (phishing) e-mails that appear to be from the IRS should be forwarded to [email protected].
For the most up-to-date information about the tax filing deadline and IRS impersonation scams, taxpayers can visit IRS.gov.
San Diego Doctor Sentenced to Prison for Fraud Against TRICARERead the Press Release
Assistant U. S. Attorney Valerie H. Chu, (619) 546-6750
SAN DIEGO – Dr. Marco Antonio Chavez was sentenced to 21 months in custody and ordered to pay restitution of $783,764.37 for defrauding TRICARE, the health care benefits program for military service members and their dependents.
According to court documents, Chavez was a physician licensed by the State of California Medical Board. Chavez provided psychiatry services, including therapy and prescription medications for children and adults diagnosed with ADHD and depression, for San Diego patients whose health care was covered by TRICARE. Chavez defrauded TRICARE by using the personal information of these patients to create and submit false and fraudulent claims for nonexistent appointments when he did not actually treat those patients. And he routinely selected the billing code for the highest-level (and highest-reimbursement) patient visit for these fabricated appointments, to maximize the fraudulent reimbursements he received from TRICARE. He swindled more than $783,000 from the taxpayer-funded health care program, and used these ill-gotten gains to buy himself luxuries including a red 2016 Jaguar and thousands of dollars’ worth of David Yurman jewelry.
Beginning in April 2013, Chavez became a network provider for TRICARE under contract with United Health Care Military & Veterans, West. That August, Chavez became eligible to submit claims directly to TRICARE through XPressClaim (“XPC”), a web-based system. Chavez used that access to help his scheme to defraud TRICARE, using his unique personal security key code to avoid review by other billing staff. He then caused the payments to be electronically transferred into an account that was in his name, which he controlled.
For example, Patient A was taken by his/her mother to see Chavez on just three occasions: December 2, 2013, December 16, 2013, and January 13, 2014. Records indicate that Chavez billed and was paid by TRICARE for 80 dates of service for Patient A, including for 21 dates before Patient A’s initial visit on December 2, 2013. On each of the three dates that correspond to dates when Patient A actually saw Chavez, the claim was submitted to TRICARE via the billing system used by administrative staff in Chavez’s clinic. But for the remaining 77 dates of service billed to TRICARE for Patient A, in which the patient did not actually see Chavez, the XPC code was used—indicating it was Chavez himself who submitted those fraudulent claims directly.
Similarly, Patient B was taken by his/her father to see Chavez on five occasions between May 2014 and August 2014. Records indicate that Chavez billed and was paid by TRICARE for 76 dates of service for Patient B. Each of the remaining 71 dates of service billed to TRICARE for Patient B, when the patient did not actually see Chavez, contained the XPC code, again indicating they were submitted by Chavez directly using XPressClaim.
Chavez tried to deflect attention and avoid detection of his fraudulent billing through a variety of deceptive means. For example, he notified patients that they might see entries on their Explanation of Benefit (“EOB”) forms from TRICARE that they would not recognize. This was an attempt to prevent patients from complaining to TRICARE and drawing attention to the false bills. In reality, Chavez knew that the reason the patients would not recognize the entries on their EOBs was because they had not actually occurred – Chavez had simply made them up.
When the TRICARE contractor conducted an audit and requested certain of Chavez’s patient files, Chavez falsely claimed that he had already sent the files, when he knew those files did not exist and could not have been sent. Chavez also misrepresented that a member of the office staff had stolen his TRICARE checks and deposited them without his permission.
Over the course of his scheme, Chavez submitted approximately $928,800 in false and fraudulent claims to TRICARE via XPC, and was paid $783,764.37 on those claims by TRICARE.
Separately, records of the State of California reflect that Chavez’s medical license was suspended in May 2018, upon the finding of an administrative judge that Chavez had treated patients while under the influence of a narcotic or alcohol.
The United States argued in its sentencing papers that Chavez exploited his privileged position as a physician, and his access to patients’ data, to commit his crime. Patients went to Chavez seeking psychiatric treatment for a variety of issues, and trusted him with some of the most troubling and sensitive aspects of their lives. Unbeknownst to them, Chavez saw the patients as his own personal piggy bank: billing opportunities to feed his lifestyle. What is more, Chavez took advantage of TRICARE—a program built upon reliance and trust. Chavez, as a medical provider, easily submitted claims under his name for services he claimed he provided, and got federal funds paid directly into his bank account.
“Through flagrant fraudulent billing, Dr. Chavez stole a quarter of a million dollars from TRICARE and spent it on luxury items, including a Jaguar and designer jewelry. But neither the citizens of this district nor the Department of Justice will stand for defrauding the government,” said U.S. Attorney Robert Brewer. “Anyone who uses TRICARE as a path to unjust enrichment will pay a heavy price, as we are 100 percent committed to protecting vital government health programs for our military and veterans.”
“Dr. Marco Chavez stole more than $780,000 from the TRICARE program which serves our veterans, military members and their families. This deliberate targeting of a healthcare program which solely aids our military troops and their families is appalling,” said Acting FBI Special Agent in Charge Omer Meisel. “When medical professionals violate their oath to honest patient care for personal greed, it significantly damages the trust required within our health care system. In order to protect the integrity of the healthcare system and government programs like TRICARE that serve our military members, the FBI is committed to rooting out fraud within the healthcare industry. We urge anyone with information about suspected healthcare fraud to contact their local FBI Field Office.”
“Dr. Chavez’ conduct is a particularly egregious example of fraud against the TRICARE program in that his greed clearly took priority over his patients’ trust and well-being,” said Bryan D. Denny, Special Agent in Charge of the Defense Criminal Investigative Service, Western Field Office. “The doctor's sentencing should serve notice to other unscrupulous healthcare providers that any unprincipled actions that corrupt the integrity of the TRICARE program and ultimately degrade the quality of health care provided to military service members and their families will be vigorously investigated by DCIS and its law enforcement partners.”
U.S. Attorney Brewer commended Assistant U.S. Attorney Valerie Chu and the FBI and DCIS agents for their exemplary work on this case.
DEFENDANT Case Number 18cr2930-L
Marco Antonio Chavez Age: 40 Brownsville, Texas
SUMMARY OF CHARGES
Health Care Fraud – Title 18, U.S.C., Section 1347
Maximum penalty: Ten years in prison and $250,000 fine
AGENCY
Federal Bureau of Investigation
Defense Criminal Investigative Service
Riviera Beach Men Charged with Stealing 93 Protected Sea Turtle Eggs After Digging Them out of Their Nest on Singer Island BeachRead the Press Release
West Palm Beach, Fl. – Federal prosecutors in West Palm Beach have charged two Florida residents with felony crimes for allegedly poaching protected sea turtle eggs to later sell them. The accused poachers allegedly stole 93 eggs from their nest on Florida’s Singer Island Beach in May of this year.
Ariana Fajardo Orshan, U.S. Attorney for the Southern District of Florida, David Pharo, Resident Agent in Charge, Florida, U.S. Fish and Wildlife Service (USFWS); and Major Olin Rondeau, South A Regional Commander, Florida Fish and Wildlife Conservation Commission (FWC) made the announcement.
The criminal complaint charges Carl Lawrence Cobb, 63, and Bruce Wayne Bivins, 63, both of Riviera Beach, Florida, with violating the Lacey Act and with criminal conspiracy. The Endangered Species Act protects sea turtle eggs. Under the Lacey Act, it is a crime to transport endangered species of fish and wildlife, including sea turtle eggs, if the purpose is to sell them. If convicted, Cobb and Bivins face up to five years in prison on each charge.
According to the criminal complaint affidavit, Cobb used his green pick-up truck to drive Bivins to the Singer Island Beach on May 24. At about 9:45 p.m., Cobb allegedly dropped Bivins off on the beach and drove away. The affidavit alleges that Bivins located a sea turtle nest, started digging, removed 93 eggs from that nest, put the eggs in a black bag, and then called Cobb for pick-up. Officers with Florida’s Fish and Wildlife Conservation Commission (FWC) saw the alleged drop-off, digging, and stealing of the protected eggs from their nest. They also saw Cobb on his return trip for Bivins. This time, Cobb drove a white pick-up truck because Cobb allegedly believed that a “game warden” had spotted him earlier in his green truck.
FWC officers stopped the white truck. They found Cobb in the driver’s seat, Bivins in the passenger’s seat, and 93 sand-dusted sea turtle eggs inside a black bag in the bed of the truck. Officers arrested Cobb and Bivins.
Marine biologists relocated the recovered eggs. The hope is that some of them will yield sea turtle hatchlings.
U. S. Attorney Fajardo Orshan commended the investigative efforts of U.S. Fish and Wildlife Service and the Florida Fish and Wildlife Conservation Commission. Assistant United States Attorneys Lauren Jorgensen and John McMillan are prosecuting this case.
A criminal complaint is a charging instrument containing allegations. A defendant is presumed innocent unless and until proven guilty in a court of law.
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 at http://pacer.flsd.uscourts.gov, under case number 20-8242-WM.
For more information on the U.S. Attorney’s Office for the Southern District of Florida, visit https://www.justice.gov/usao-sdfl.
President of Law Enforcement Union Charged with Defrauding Union’s Annuity FundRead the Press Release
Audrey Strauss, Acting United States Attorney for the Southern District of New York, William F. Sweeny Jr., Assistant Director-in-Charge, New York Division, Federal Bureau of Investigation (“FBI”), and Andriana Vamvakas, Northeastern Regional Director, U.S. Department of Labor Office of Labor-Management Standards (“DOL-OLMS”), announced the arrest of KENNETH WYNDER Jr., a former New York State Trooper and the president of the Law Enforcement Employees Benevolent Association (“LEEBA”), a labor union for law enforcement officers employed by the City of New York (the “City”), for defrauding union members by misappropriating money from LEEBA’s Annuity Fund. STEVEN WHITTICK, LEEBA’s treasurer and a police officer for New York City’s Department of Environmental Protection (“DEP”), was charged separately with obstructing the investigation into fraud in connection with LEEBA and the Annuity Fund and making false statements to federal agents. Both defendants are expected to appear before U.S. Magistrate Judge Robert W. Lehrburger in Manhattan federal court this afternoon.
Acting U.S. Attorney Audrey Strauss said: “Today we have charged two leaders of a union that represents local law enforcement officers for engaging in criminal conduct, something they and their membership are sworn to combat. As alleged, Kenneth Wynder abused his position as the union’s president and its annuity fund’s administrator and trustee to raid his members’ retirement accounts. As further alleged, Steven Whittick, the union’s treasurer, took repeated steps to obstruct a federal investigation aimed at uncovering those financial improprieties.”
FBI Assistant Director William F. Sweeny Jr. said: “As alleged, both law enforcement and civilian members of multiple city agencies had their retirement savings compromised by two individuals who prioritized their own financial well-being over that of the hardworking men and women who dedicated their livelihood to serving the public. Most people only get one chance to put aside enough money to last them into retirement. To think the money these individuals worked so hard for could allegedly be swindled by the very people who play a role in managing it is disturbing beyond belief. Today’s arrests bring us one step closer to making sure justice is served in this case.”
DOL-OLMS Northeastern Regional Director Andriana Vamvakas said: “Union officials are required to use the union’s funds only for legitimate purposes, not their own personal gain. Financial misappropriation by union officials not only breaks the law, it betrays the trust placed in them by their membership. OLMS was proud to work with its partners at the Office of the U.S. Attorney for the Southern District of New York and the Federal Bureau of Investigation in investigating this case.”
According to the allegations contained in the two Complaints unsealed in Manhattan federal court, publicly available information, and prior court filings:[1]
Law Enforcement Employees Benevolent Association and the Annuity Fund
LEEBA is a labor union that has acted as the collective bargaining representative principally for law enforcement personnel at various City agencies, and has entered into agreements on behalf of those law enforcement employees, including agreements for insurance and retirement benefits. The City agencies whose employees LEEBA represented included, at various times, the Department of Environmental Protection (“DEP”), the Department of Sanitation (“Sanitation”), and the Department of Transportation (“Transportation”).
The Annuity Fund is a LEEBA fund that received monthly contributions from the City for the benefit of LEEBA’s members, and maintained separate accounts for each fund member. These accounts were functionally similar to employer-sponsored 401(k) retirement accounts. Both WYNDER and WHITTICK were Trustees of the Annuity Fund and signatories to agreements that governed the fund. Under the relevant agreements and plans, the money in the Annuity Fund could be used for no purpose other than funding individual members’ retirement accounts and defraying reasonable administrative expenses of the Annuity Fund itself.
WYNDER
WYNDER, a former New York State Trooper, is the President of LEEBA and a member of LEEBA’s board of directors. WYNDER has also served as the Fund Administrator of the Annuity Fund and as a member of the board of trustees of the Annuity Fund, pursuant to which he owed a fiduciary duty to act in the best interests of the Annuity Fund and its account holders. WYNDER also was on the board of trustees of the LEEBA Welfare Fund (the “Welfare Fund,” and collectively with the Annuity Fund, the “LEEBA Funds”), which provided supplemental insurance benefits to its members. While occupying those positions, WYNDER centralized and controlled major decision-making authority for LEEBA and the LEEBA Funds, often acting without the proper approval of their respective boards of directors or trustees. WYNDER’s de facto dominance of LEEBA and the LEEBA Funds enabled him to make decisions in his own self-interest and contrary to the interests of the Annuity Fund and individual members.
WHITTICK
WHITTICK, a DEP police officer, is the Treasurer of LEEBA, and a member of the board of directors of LEEBA and the boards of trustees of the LEEBA Annuity Fund and the LEEBA Welfare Fund. As LEEBA’s Treasurer, WHITTICK had responsibility for LEEBA’s financial matters and accounts, arranging for LEEBA to pay its payroll through an outside payroll processing firm starting in 2016, as well as having signatory authority over LEEBA’s main operating bank account.
WYNDER’s Alleged Fraud Scheme
From at least in or about 2012 up to and including the date of this Complaint, WYNDER participated in a scheme to steal, embezzle, and misappropriate money from the Annuity Fund and individual members’ retirement accounts. Specifically, WYNDER made hundreds of thousands of dollars of fraudulent transfers from the Annuity Fund to LEEBA’s operating account, which he controlled, and regularly used the funds, once transferred from the Annuity Fund, to enrich himself at union members’ expense, including through unauthorized and excessive checks to himself and cash withdrawals for his own benefit. In addition, WYNDER caused the union to pay for various personal expenses such as a second residence, clothing, travel expenses, and the purchase of a personal automobile, all paid for by the union, and none of which were contemporaneously reported to the Internal Revenue Service (“IRS”), as required.
To accomplish this fraudulent scheme, WYNDER, acting in his capacity as the Annuity Fund’s Plan Administrator, repeatedly made false and misleading statements to a third-party retirement plan manager that served as the custodian for the Annuity Fund and the retirement accounts of individual union members, including through emails and faxes that WYNDER used to withdraw increasingly large sums of money from the Annuity Fund, effectively causing such withdrawals to be made from the retirement accounts of individual members. From in or about 2014 through in or about 2019, WYNDER caused the withdrawal of more than $500,000 from the individual retirement accounts that constitute the Annuity Fund, thereby wiping out the entire balance of certain members’ accounts. Without these improper withdrawals from the Annuity Fund, the LEEBA operating account would have been insolvent, and would have had insufficient funds to pay for WYNDER’s excessive checks to himself and cash withdrawals and the personal expenses he caused to be charged to that account.
In addition, throughout the duration of this scheme, WYNDER repeatedly made and approved false and misleading statements to LEEBA’s members and prospective members about how he was purportedly using and protecting their retirement accounts and the LEEBA Annuity Fund. WYNDER further concealed his scheme by causing LEEBA to fail to timely file mandatory reports and financial disclosures with the City and public reports to the Annuity Fund’s members, and by making false statements to the Annuity Fund’s auditors and accountants.
WHITTICK’s Alleged Obstruction of Justice
From at least in or about 2017 through in or about August 2019, while serving as LEEBA’s Treasurer, and after learning of the federal investigation into LEEBA’s finances including the embezzlement scheme described above, WHITTICK repeatedly lied to federal agents in an effort to obstruct that investigation. WHITTICK did so despite personal involvement in some of the financial improprieties with which WYNDER is charged. For example, as alleged, on at least two occasions, on or about February 1, 2018, and March 30, 2018, WHITTICK withdrew $16,000 in cash from a LEEBA bank account, and on each occasion deposited $15,000 cash into WYNDER’s personal bank account and $1,000 cash into WHITTICK’s own personal bank account.
After the FBI had executed a search warrant of LEEBA’s offices in September 2019, WHITTICK attempted to obstruct and to influence the ongoing federal investigation by making, in two different interviews with law enforcement agents, false statements about, among other subjects, cash withdrawals he made from LEEBA’s bank accounts, unauthorized withdrawals from LEEBA’s Annuity Fund and from members’ individual accounts, and LEEBA’s payment for certain travel and entertainment expenses for union officers, including WHITTICK and WYNDER.
* * *
WYNDER, 56, of Stroudsburg, Pennsylvania, is charged with one count of wire fraud, which carries a maximum penalty of 20 years in prison.
WHITTICK, 50, of Kingston, New York, is separately charged with one count of obstruction of justice, which carries a maximum penalty of 20 years in prison, and two counts of false statements to federal investigators, each of which carries a maximum penalty of five years in prison.
The maximum potential sentences in these cases are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge.
Ms. Strauss praised the outstanding work of the FBI and the Department of Labor OLMS. Ms. Strauss also thanked IRS-Criminal Investigations, the New York City Comptroller’s Office, and the New York City Department of Investigation for their assistance.
The case is being prosecuted by the Office’s Public Corruption Unit. Assistant U.S. Attorneys David Raymond Lewis and Eli J. Mark are in charge of the prosecution.
The charges contained in the Complaints are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaints, and the description of the Complaints set forth herein, constitute only allegations, and every fact described therein should be treated as an allegation.
Prattville Man Sentenced for Wire Fraud and Transporting Stolen VehicleRead the Press Release
Montgomery, Alabama – On Thursday, July 9, 2020, Robert Brandon Malone, 35, a resident of Prattville, Alabama, was sentenced to 71 months in prison after pleading guilty to federal wire fraud charges and to transporting a stolen vehicle, announced United States Attorney Louis V. Franklin, Sr., FBI Special Agent in Charge James Jewell, and Prattville Police Chief Mark Thompson. In addition, Malone was ordered to pay $93,784.68 in restitution to his victims and serve three years of supervised release after he completes his time in prison.
According to court records, from early 2017 through late 2018, Malone orchestrated multiple schemes to sell automobiles that did not belong to him. First, in April of 2017, Malone posted a Dodge Ram 1500 pickup truck for sale on the advertising website craigslist that was actually a trade-in vehicle to the dealership for which he worked at the time. A potential buyer saw the post and purchased the truck. However, after discovering that Malone did not actually own the vehicle, it was returned to the dealership. Malone did not refund the buyer’s money.
Later, in January of 2018, Malone was completing work on a Chevrolet C-10 pickup truck for someone and was storing it at his shop. Malone again created a craigslist post listing it for sale and he ultimately arranged to trade it for another vehicle. Once the buyer learned that Malone did not actually own the truck, it was returned to the rightful owner. However, the vehicle that was traded was not returned.
Finally, in November of 2018, Malone was in the process of completing the paperwork to purchase an Audi R8 at a car dealership in Georgia. Before the purchase was complete, he left with the vehicle and returned to Prattville. He then contacted someone that he knew was in the market for an Audi and they made a trip to Prattville to look at the vehicle. The purchaser gave him a down payment for the car and left his F-150 with Malone to hold temporarily until he could return to pick it up. However, Malone did not wait for the owner to return, instead, he listed the truck on Instagram and sold it to another individual. Ultimately, the Audi was returned to the dealership and the truck to the Audi purchaser. However, neither victim recovered their losses.
Malone was indicted by a federal grand jury in October of 2019 on three counts of wire fraud and one count of transporting a stolen vehicle. He was arrested on those charges on November 1, 2019, and released pending his trial. However, his pre-trial release was revoked on February 7, 2020 after it was discovered that, while working at a car dealership in Pelham, Alabama, he was engaging in similar conduct that violated Alabama state law. He has been in federal custody since.
“While carrying out his schemes and scamming his victims out of thousands of dollars, Malone showed no concern about being caught or held accountable,” stated U.S. Attorney Louis V. Franklin, Sr. “Even after being arrested and charged for his crimes, he chose to return to his old ways. I am thankful to our law enforcement partners for putting a stop to his crime spree and helping to get justice for his victims. Once again, this case reminds us that we must always exercise caution when making purchases through online websites.”
FBI Special Agent in Charge James Jewell stated, “This is the result when state, local, and federal authorities work together to make our communities a safer place.”
“Malone’s crimes were widespread and harmed a number of victims,” stated Prattville Police Chief Mark Thompson. “I am grateful for the cooperation and support we received from the FBI and U.S. Attorney’s Office in this case. Due to the great relationships we have established with our federal partners, the victims in this case will get the justice they deserve.”
The Federal Bureau of Investigation (FBI) and the Prattville Police Department investigated this case. Assistant U.S. Attorney Brandon Bates prosecuted this case.
Pikeville Man Sentenced to 156 Months for Human Trafficking ChargesRead the Press Release
PIKEVILLE, Ky. – A Pikeville man, Ernest Ray, 56, was sentenced Monday, to 156 months in federal prison, by U.S. District Judge Karen Caldwell, after previously pleading guilty to five counts of recruiting, enticing, harboring, transporting, providing, and maintaining minors to engage in commercial sexual acts.
According to his plea agreement, Ray admitted that he provided five minors alcohol, cigarettes, money, and drugs (i.e., marijuana), in exchange for the minors engaging in sexual acts in front of the Defendant. Ernest admitted that, on numerous occasions, he drove the minors to a rural location for the purpose of having them engage in these sexual acts. Some of the sexual acts also took place at his residence.
Ray pleaded guilty in June 2019.
Under federal law, Ray must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for life. Additionally, Ray will be required to pay $60,000, in lieu of forfeiture of the real property and vehicles used in the crimes.
Robert M. Duncan, Jr., U.S. Attorney for the Eastern District of Kentucky, and James Robert Brown, Special Agent in Charge, FBI, Louisville Field Office, jointly made the announcement.
The investigation was conducted by the FBI. The United States was represented in the case by Assistant U.S. Attorney Hydee Hawkins.
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Ohio Resident Indicted on Charges of Enticement and Having Sex with A MinorRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that a federal grand jury has returned a three-count indictment charging Priscilla Vogelbacher, 37, of Oregon, Ohio, with one count of enticement of a minor and two counts of interstate travel with the intent to engage in illicit sexual conduct. The charges carry a mandatory minimum penalty of 10 years in prison, a maximum of life, and a $250,000 fine.
Assistant U.S. Douglas A. Penrose, who is handling the case, stated that according to the indictment, between November 2018 and June 2019, the defendant began a relationship with the minor victim over the internet and enticed the minor victim to engage in sexual activity. Vogelbacher is also accused of making two separate trips from Ohio to Jamestown, NY, for the purpose of having sex with the minor victim, who was 15 years old at the time.
The defendant was arraigned today before Judge Michael J. Roemer and released on conditions.
The indictment is the result of an investigation by the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Stephen Belongia; the Jamestown Police Department, under the direction of Acting Chief Timothy Jackson; and the Ellicott Police Department, under the direction of Chief William Ohnmeiss Jr.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
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Nascent Devices, Inc. to Pay $70,000 to Resolve Potential False Claims LiabilityRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Nascent Devices, Inc. (Nascent) has agreed to pay the United States $70,000 to resolve potential liability under the False Claims Act.
According to U.S. Attorney David J. Freed, the investigation arose from Nascent’s conduct with respect to a Small Business Technology Transfer (STTR) award received from the National Science Foundation. It is alleged that Nascent improperly charged unallowable and unallocable costs toward the award, applied a significantly higher overhead rate to account for underspending, and provided false certifications on its final report cover page in 2015.
“Potential false claims under grant programs such as the Small Business Technology Transfer program from the National Science Foundation, impact citizens and potential grant recipients alike,” said U.S. Attorney Freed. “It is vital that we hold grantees accountable. Our ACE Unit works closely together with a variety of federal agencies to ensure compliance and responsible stewardship of federal funds.”
“The National Science Foundation is a strong supporter of the Small Business Technology Transfer program,” said Allison Lerner, National Science Foundation Inspector General. “However, the Foundation expects grant recipients to abide by the award terms and conditions, including the federal cost principles. Expenses charged to grants must be allowable, allocable and reasonable. Similarly, awardees cannot significantly underspend awards and keep the surplus funds without consequence. I commend the U.S. Attorney’s Office for their work on upholding federal grant rules in this case.”
This Settlement Agreement is neither an admission of liability by Nascent nor a concession by the United States that its claims are not well founded.
This case was investigated by the NSF Office of Inspector General. The investigation was handled by Assistant United States Attorney, Tamara J. Haken and the Affirmative Civil Enforcement (ACE) Unit within the U.S. Attorney’s Office.
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Minneapolis Man Charged with Illegally Possessing A FirearmRead the Press Release
United States Attorney Erica H. MacDonald today announced a criminal complaint charging ZACHARY VICTOR ROBINSON, 27, with one count of possession of a firearm by a felon. ROBINSON was arrested in Chicago, Illinois, on July 10, 2020, on a Minnesota state complaint-warrant for second-degree intentional murder. ROBINSON will make an initial appearance in U.S. District Court at a later date.
According to the allegations in the criminal complaint and law enforcement affidavit, on December 31, 2019, pursuant to an active arrest warrant, officers with the Minneapolis Police Department (MPD) were conducting surveillance on ROBINSON. When MPD officers observed ROBINSON exit a residence in Brooklyn Park, Minnesota, they moved in to make an arrest, ordering ROBINSON to put his hands in the air. ROBINSON complied and told the officers that he had a gun on his left side. After taking ROBINSON into custody, officers recovered a Taurus, model PT111 Millennium G2, 9mm semiautomatic pistol from ROBINSON’s side. Because ROBINSON has prior felony convictions, he is prohibited under federal law from possessing firearms or ammunition at any time.
ROBINSON has been charged by the Hennepin County Attorney’s Office with second-degree intentional murder, second-degree assault, felon in possession of a gun, and first-degree riot. ROBINSON was arrested in Chicago on July 10, by the FBI, in partnership with the Bureau of Alcohol, Tobacco, Firearms and Explosives, Cook County Sheriff’s Office, Chicago Police Department, and the Illinois State Police.
This case is the result of an investigation conducted by the Minneapolis Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. This case was brought as part of the Twin Cities Violent Crime Task Force, a multi-agency effort that brings together additional federal and state resources to assist local law enforcement to investigate, arrest, and prosecute individuals responsible for gun violence in the Twin Cities. For more information about the Twin Cities Violent Crime Task Force, please visit https://www.justice.gov/usao-mn/pr/united-states-attorney-announces-new-twin-cities-violent-crime-task-force.
Assistant U.S. Attorney Benjamin Bejar is prosecuting the case.
The charges contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Defendant Information:
ZACHARY VICTOR ROBINSON, 27
Minneapolis, Minn.
Charges:
- Felon in possession of a firearm, 1 count
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Mexican Man Given More than a Decade Long Prison Sentence for Methamphetamine TraffickingRead the Press Release
A man who conspired to distribute over 750 grams of methamphetamine was sentenced today to more than a decade in federal prison.
Fredy Juan Morales-Alvarez, age 33, from Michoaćan, Mexico, received the prison term after a February 2020 guilty plea to Conspiracy to Distribute Methamphetamine.
In a plea agreement, Morales-Alvarez admitted that, beginning in the fall of 2013 and continuing through December 17, 2013, he conspired to traffic methamphetamine. On December 17, 2013, law enforcement searched Morales-Alvarez’s car during a traffic stop in Waterloo, Iowa, and recovered over 50 grams of methamphetamine. Law enforcement then searched his home, finding an additional 122 grams of methamphetamine, $6,540 in United States currency, and a digital scale.
Morales-Alvarez was sentenced in Cedar Rapids by United States District Court Judge C.J. Williams. Morales-Alvarez was sentenced to 121 months’ imprisonment. He must also serve a five-year term of supervised release after the prison term. There is no parole in the federal system.
Morales-Alvarez is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Lisa Williams and Special Assistant United States Attorney Dillan Edwards and investigated by the Iowa Division of Narcotics Enforcement, the Waterloo Police Department, the Cedar Falls Police Department, and the Black Hawk County Sheriff’s Department.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 14-CR-2013.
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Marrero Man, Convicted in 2006 of Child Pornography Possession, Charged Again with Receipt and Possession of Child PornographyRead the Press Release
NEW ORLEANS – U.S. Attorney Peter G. Strasser announced that BRADLEY EDWARD CORLEY, age 45, a resident of Marrero, Louisiana, was charged July 10, 2020 in a two-count Indictment with receipt and possession of images and videos depicting the sexual exploitation of children, including children as young as approximately four (4) years old, in violation of 18 U.S.C. ' 2252(a)(2) and 2252(a)(4)(B). In 2006, CORLEY was convicted in the United States District Court for the Eastern District of Louisiana of possession of child pornography.
Because of his prior conviction, if convicted in this matter CORLEY faces a mandatory minimum term of imprisonment of fifteen (15) years and a maximum term of imprisonment of forty (40) years under the receipt charge and a mandatory minimum term of imprisonment of ten (10) years and a maximum term of imprisonment of twenty (20) years for the possession charge. CORLEY also faces a lifetime of supervised release, a $250,000 fine, and he can be required to register as a sex offender.
U. S. Attorney Strasser reiterated that an indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
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 United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
U.S. Attorney Strasser praised the work of the Federal Bureau of Investigation in investigating this matter, with support from the Jefferson Parish Sheriff’s Office. Assistant United States Attorney Jordan Ginsberg is in charge of the prosecution.
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Man Sentenced to Prison for Assaulting Federal Officer in Owyhee, NevadaRead the Press Release
RENO, Nev. — Richard Frank Roa Jr., 36, was sentenced today by U.S. District Judge Larry R. Hicks to 37 months in prison for assaulting a federal officer and causing bodily injury to the officer while he was engaged in official duties, announced U.S. Attorney Nicholas A. Trutanich for the District of Nevada.
“This case illustrates how law enforcement officers put themselves in harm’s way at a moment’s notice to protect vulnerable members of the community,” said U.S. Attorney Trutanich. “Our office is grateful to the women and men who serve on the front lines in their mission to keep our communities safe.”
Roa pleaded guilty March 3, 2020, to one count of assault on a federal officer. Roa was remanded to the custody of the U.S. Marshals Service after today’s sentencing hearing.
According to court documents, on November 12, 2017, Roa’s father called the police to report that Roa was causing a disturbance and damaging a vehicle at his father’s house, located in Owyhee, Nevada. A Bureau of Indian Affairs officer responded to the call. When the officer arrived, Roa’s father told the officer that he wanted Roa removed from the house. The officer attempted to arrest Roa, but he resisted, and assaulted and caused injury to the officer.
The charges resulted from an investigation by the Bureau of Indian Affairs. Assistant U.S. Attorney Penelope Brady prosecuted the case.
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Jury Finds Eagle Butte Man Not Guilty of AssaultRead the Press Release
United States Attorney Ron Parsons announced that an Eagle Butte, South Dakota, man was acquitted of Assault Resulting in Serious Bodily Injury as a result of a federal jury trial in Pierre, South Dakota, beginning July 8, 2020, and concluding on July 9, 2020.
Lucian Rising Sun, a/k/a Sonny Rising Sun, age 28, was indicted by a federal grand jury on March 9, 2020.
The charge stemmed from an alleged incident that occurred on January 29, 2020, in Eagle Butte.
The investigation was conducted by the Cheyenne River Sioux Tribe Law Enforcement Services and the U.S. Attorney's Office prosecuted the case.
Jury Finds Bullhead Man Guilty of Child AbuseRead the Press Release
United States Attorney Ron Parsons announced that Tyson Keepseagle, age 33, of Bullhead, South Dakota, was found guilty of three counts of Child Abuse as a result of a federal jury trial in Aberdeen, South Dakota. The verdict was returned on July 10, 2020.
The charges carry a maximum penalty of 35 years in federal prison and/or a $750,000 fine, 9 years of supervised release, and a $300 special assessment to the Federal Crime Victims Fund.
Keepeagle was indicted by a federal grand jury on May 14, 2019.
The conviction stems from incidences between June 1, 2018, and August 12, 2018, when the child victims lived with Keepseagle and he abused the children leaving them with bruises, bloody noses, and swelling.
This case was investigated by the Bureau of Indian Affairs, Standing Rock Agency. Assistant U.S. Attorney Kirsten Jasper prosecuted the case.
A presentence investigation was ordered and a sentencing date was set for September 28, 2020. The defendant remained out on bond and given a date to self-report to the custody of the U.S. Marshals Service.
IRS Criminal Investigation and the U.S. Attorney remind taxpayers of upcoming tax filing deadline; urge taxpayers to remain vigilant of scamsRead the Press Release
SACRAMENTO, Calif. — The Internal Revenue Service Criminal Investigation division and the U.S. Attorney’s Office for the Eastern District of California reminded taxpayers of the July 15 filing and payment deadline and warned against an increase in tax and COVID-19 scams.
Due to COVID-19, the original filing deadline and tax payment due date for 2019 was postponed from April 15 to July 15. Taxpayers filing Form 1040 series returns must file Form 4868 by July 15 to obtain the automatic extension to Oct. 15.
“Although the extension provides additional time to file the tax return – it is not an extension to pay any taxes due,” said Kareem Carter, Special Agent in Charge of the IRS Criminal Investigation division in California. “For people facing hardships who cannot pay in full, including those affected by COVID-19, the IRS has several options available to help. The IRS encourages taxpayers to visit IRS.gov as soon as possible to explore these options and avoid accruing interest and penalties after the July 15 deadline.”
As the filing deadline approaches, taxpayers should beware of tax and COVID-19 related scams. “Criminals use the tax filing deadline as an opportunity to steal personal and financial information,” said U.S. Attorney McGregor W. Scott for the Eastern District of California. “Taxpayers should remain vigilant and know that the IRS will not initiate contact with them via phone, email or social media to request personal or financial information.”
In the last few months, the IRS Criminal Investigation division (CI) has continued to see a tremendous increase in a variety of Economic Impact Payment scams and other financial schemes. CI continues to work with its law enforcement partners to put a stop to these schemes and bring criminals to justice.
Taxpayers can report COVID-19 scams to the National Center for Disaster Fraud. Taxpayers can also report fraud or theft of their Economic Impact Payments to the Treasury Inspector General for Tax Administration (TIGTA). Unsolicited (phishing) emails that appear to be from the IRS should be forwarded to [email protected].
For the most up-to-date information about the tax filing deadline and IRS impersonation scams, taxpayers can visit IRS.gov. To verify the identity of an IRS Special Agent please contact [email protected].
IRS Criminal Investigation and United States Attorney's Office Remind Taxpayers of Upcoming Tax Filing Deadline and Urge Taxpayers to Remain Vigilant of ScamsRead the Press Release
The Internal Revenue Service Criminal Investigation division and the U.S. Attorney’s Office for the Western District of North Carolina reminded taxpayers of the July 15 filing and payment deadline and warned against an increase in tax and COVID-19 scams.
Due to COVID-19, the original filing deadline and tax payment due date for 2019 was postponed from April 15 to July 15. Taxpayers filing Form 1040 series returns must file Form 4868 by July 15 to obtain the automatic extension to Oct. 15.
"Although the extension provides additional time to file the tax return – it is not an extension to pay any taxes due", said Matthew D. Line, Special Agent in Charge of the IRS Criminal Investigation division in North Carolina, South Carolina and Tennessee. "For people facing hardships who cannot pay in full, including those affected by COVID-19, the IRS has several options available to help. The IRS encourages taxpayers to visit IRS.gov as soon as possible to explore these options and avoid accruing interest and penalties after the July 15 deadline."
As the filing deadline approaches, taxpayers should beware of tax and COVID-19 related scams. "Criminals use the tax filing deadline as an opportunity to steal personal and financial information", said R. Andrew Murray, U.S. Attorney for the Western District of North Carolina. "Taxpayers should remain vigilant and know that the IRS will not initiate contact with them via phone, email or social media to request personal or financial information."
In the last few months, the IRS Criminal Investigation division (CI) has continued to see a tremendous increase in a variety of Economic Impact Payment scams and other financial schemes. CI continues to work with its law enforcement partners to put a stop to these schemes and bring criminals to justice.
Taxpayers can report COVID-19 scams to the National Center for Disaster Fraud. Taxpayers can also report fraud or theft of their Economic Impact Payments to the
Treasury Inspector General for Tax Administration (TIGTA). Unsolicited (phishing) e-mails that appear to be from the IRS should be forwarded to [email protected].
For the most up-to-date information about the tax filing deadline and IRS impersonation scams, taxpayers can visit IRS.gov.
Houma Man Charged with Federal Firearm and Drug ChargesRead the Press Release
NEW ORLEANS - U.S. Attorney Peter G. Strasser announced today that a federal grand jury returned a four-count indictment on July 10, 2020 against defendant DONOVAN D. CLAY a/k/a “Donavan D. Clay,” a/k/a “Pluto,” age 27, of Houma, LA, for distribution of heroin, in violation of Title 21, United States Code, Section 841(a)(1)(C) (Counts 1-2); possession with intent to distribute heroin, in violation of Title 21, United States Code, Section 841(a)(1)(B) (Count 3); and possession of a felon in possession of a firearm, in violation of Title 18, United States Code, Section 922(g)(1) (Count 4).
If convicted for a violation of either Count 1 or 2, CLAY faces a maximum term of imprisonment of twenty (20) years and a fine of not more than $1,000,000, at least three (3) years supervised release following any term of imprisonment, and a $100 special assessment fee. For Count 3, CLAY faces a minimum of five (5) years up to maximum of forty (40) years imprisonment and a fine of not more than $5,000,000, at least four (4) years supervised release following any term of imprisonment, and a $100 special assessment fee. For Count 4, CLAY faces a maximum of ten (10) years imprisonment and a fine of not more than $250,000, up to three (3) years supervised release following any term of imprisonment, and a $100 special assessment fee.
United States Attorney Strasser reiterated that an Indictment is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
Project Safe Neighborhoods (PSN) is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
This matter was handled by Homeland Security Investigations and the Houma Police Department. Assistant United States Attorney Duane A. Evans is prosecuting the matter.
Hartford Drug Dealer Sentenced to 5 Years in Federal PrisonRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that PEDRO RIVERA, also known as “Heavy,” 42, of Hartford, was sentenced today by U.S. District Judge Michael P. Shea in Hartford to 60 months of imprisonment, followed by five years of supervised release, for trafficking narcotics.
According to court documents and statements made in court, in August 2017, the Drug Enforcement Administration’s Hartford Task Force launched an investigation into a drug trafficking organization that was selling large amounts of heroin, fentanyl, cocaine and crack cocaine in Hartford. Julio Oliveras, also known as “Cuzzo Jay,” was identified as the leader of the organization. The investigation, which included approximately six months of court-authorized wiretaps, controlled purchases of narcotics and physical surveillance, revealed that Oliveras and his associates supplied distribution quantities of narcotics to several Hartford-area drug dealers, including Rivera, and used multiple locations in Hartford to process, store and distribute narcotics.
Rivera was regularly intercepted on wiretaps ordering fentanyl and heroin, typically in 50-gram or 100-gram quantities, and wholesale quantities of cocaine, from Oliveras.
Rivera, Oliveras and other members of the organization were arrested on July 19, 2018. On that date, investigators executed 10 search warrants and seized approximately 2.7 kilograms of fentanyl, one kilogram of heroin, approximately 500 grams of crack cocaine, 100 grams of cocaine, eight firearms, more than 1,000 rounds of ammunition, cash, and other evidence of narcotics trafficking activity. The drugs and firearms were found at a stash house Oliveras maintained, a storage unit he rented, and the residences of his associates.
On August 2, 2018, a grand jury in Hartford returned an indictment charging Rivera, Oliveras and 14 co-defendants with various offenses.
Rivera has been detained since his arrest. On August 29, 2019, he pleaded guilty to one count of conspiracy to distribute and to possess with intent to distribute heroin, fentanyl and cocaine.
Oliveras pleaded guilty to narcotics and firearm offenses and, on January 15, 2020, was sentenced to 186 months of imprisonment.
This is Rivera’s second federal conviction. In September 2004, he was sentenced to 60 months of imprisonment for distributing large quantities of crack cocaine. His sentence was subsequently reduced to 48 months of imprisonment pursuant to changes in the federal sentencing guidelines for crack cocaine offenses.
The Drug Enforcement Administration’s Hartford Task Force includes personnel from the DEA Hartford Resident Office and the Bristol, Hartford, East Hartford, Manchester, New Britain, Rocky Hill, Wethersfield, Windsor Locks and Willimantic Police Departments. Agencies assisting the investigation include the Bureau of Alcohol, Tobacco, Firearms and Explosives, Connecticut Department of Correction, and the East Hartford, New Britain, Newington and West Hartford Police Departments.
This case is being prosecuted by Assistant U.S. Attorney Geoffrey M. Stone.
Hancock County Man Pleads Guilty to Illegal Moonshine ChargesRead the Press Release
Gulfport, Miss – Willie Necaise, Jr., 77, of Hancock County, pled guilty Friday before U.S. District Judge Sul Ozerden to Unlawful Production of Distilled Spirits and Interstate Travel in Aid of a Racketeering Enterprise, announced U.S. Attorney Mike Hurst and Kurt Theilhorn, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Judge Ozerden will sentence Necaise on October 16, 2020 at 10:00 a.m. He faces a maximum penalty of 5 years in prison on each charge. He further faces fines up to $250,000 and 3 years of supervised release.
Agents with the Enforcement Office of the Mississippi Alcoholic Beverage Control (“ABC”) Division began investigating Necaise in 2018. The investigation revealed that, over time, Necaise traveled out of state and obtained at least 569,775 pounds of sugar, a primary ingredient for moonshine. In addition, records showed Necaise getting large deliveries of propane gas to a rural shed in Hancock County, even during the summer. Agents tracked Necaise to Slidell, Louisiana, and observed him getting a pallet of sugar and coming back to Hancock County. Armed with a search warrant, ABC Agents found forty 55-gallon drums of mash, 1200 new plastic jugs and a 200-gallon stainless steel cooker, along with sugar and other items related to illegal moonshine. Necaise did not have a license to distill liquor.
Based on the records of the sugar purchased, it was determined that over 74,070 gallons of taxable whiskey would be produced. No excise tax has ever been paid by Necaise. He therefore owes the ATF Tax and Trade Bureau $898,691.63 in Federal Excise Tax and the Mississippi Department of Revenue $369,752.50 in State Excise Tax.
U.S. Attorney Hurst commended the incredible work of the agents of the Enforcement Office of the Mississippi Alcoholic Beverage Control Division of the Mississippi Department of Revenue and the Bureau of Alcohol, Tobacco, Forearms and Explosives, who cooperated in investigating the case. Assistant United States Attorney Annette Williams is prosecuting the case.
Guatemalan Man Sentenced to Prison for Illegally Reentering the United States after Being Deported Two TimesRead the Press Release
A man who illegally returned to the United States after being deported two times was sentenced today to eight months in federal prison.
Juan Sanchez-Cobo, age 35, a citizen of Guatemala illegally present in the United States and residing in Fort Madison, Iowa, received the prison term after a February 6, 2020 guilty plea to one count of illegal reentry into the United States.
At the guilty plea, Sanchez-Cobo admitted he had previously been deported from the United States and illegally reentered the United States without the permission of the United States government. Sanchez-Cobo was deported in October 2016 following a conviction in the Western District of Texas for illegal entry, a misdemeanor. He was also deported in July 2018 following a conviction in the Western District of Texas for illegal reentry, a felony. Sanchez-Cobo most recently came to the attention of immigration agents on December 25, 2019, following his arrest and conviction in Linn County, Iowa, for public intoxication.
Sanchez-Cobo was sentenced in Cedar Rapids by United States District Court Judge C.J. Williams. Sanchez-Cobo was sentenced to eight months’ imprisonment. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
Sanchez-Cobo is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Daniel C. Tvedt and investigated by Department of Homeland Security, Immigration and Customs Enforcement, Enforcement and Removal Operations.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 20-CR-04.
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Georgia Man to Federal Prison for Iowa Meth ConspiracyRead the Press Release
A man who conspired to distribute methamphetamine was sentenced July 13, 2020, to 12 years in federal prison.
Dylan Davis, 27, from Hartwell, Georgia, received the prison term after a March 10, 2020, guilty plea to conspiracy to distribute methamphetamine.
Evidence at the guilty plea and sentencing hearing, showed that in November 2017, a traffic stop was conducted on a vehicle Davis was a passenger in. During the stop, law enforcement located a loaded CZ Scorpion EVO 3 S1 9mm pistol and two magazines - one loaded with 12-9mm rounds over which which Davis admitted ownership. Pursuant to the stop, officers lawfully searched the vehicle and recovered approximately 4 ounces of methamphetamine located on the back seat near the gun, along with numerous baggies containing approximately 70 grams of marijuana, three digital scales, a red plastic grinder containing methamphetamine, numerous prescription pills, zig zag rolling papers, syringes, 2 glass methamphetamine pipes, numerous plastic zip-lock baggies of various size, two cell phones, and other drug paraphernalia.
Davis was sentenced in Sioux City by United States District Court Chief Judge Leonard T. Strand. Davis was sentenced to 144 months’ imprisonment. He must also serve a 5-year term of supervised release after the prison term. There is no parole in the federal system. Davis is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Mikala Steenholdt and investigated by Tri-State Drug Task Force based in Sioux City, Iowa, that consists of law enforcement personnel from the Drug Enforcement Administration; Sioux City, Iowa, Police Department; Homeland Security Investigations; Woodbury County Sheriff’s Office; South Sioux City, Nebraska, Police Department; Nebraska State Patrol; Iowa National Guard; Iowa Division of Narcotics Enforcement; United States Marshals Service; South Dakota Division of Criminal Investigation; and Woodbury County Attorney’s Office.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 17-4074.
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Fort Ann Man Sentenced on Cocaine and Methamphetamine Distribution ConvictionsRead the Press Release
ALBANY, NEW YORK – Nestor Cordero-Hernandez, age 43, of Fort Ann, New York, was sentenced today to 87 months in prison for conspiring to distribute and possess with intent to distribute more than 500 grams of cocaine and more than 50 grams of methamphetamine.
The announcement was made by United States Attorney Grant C. Jaquith and Ray Donovan, Special Agent in Charge, U.S. Drug Enforcement Administration (DEA), New York Division.
Cordero-Hernandez was also ordered to serve a 3-year term of supervised release following his release from prison, and to forfeit $42,450 in proceeds from his drug trafficking activity.
In imposing sentence, the Court found that between September 2018 and November 2019, Cordero-Hernandez agreed with others to participate in a drug trafficking conspiracy that distributed over 600 grams of methamphetamine and 450 grams of cocaine in Fort Ann, and elsewhere, for profit. He faces deportation to Mexico following the completion of his sentence.
This case was investigated by the DEA, and the Warren and Washington County Sheriff’s Offices, and was prosecuted by Assistant U.S. Attorney Ashlyn Miranda.