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Thursday 9 July 2020
Two Aliens Indicted on Illegal Reentry ChargesRead the Press Release
RALEIGH, N.C. – A federal grand jury returned indictments charging Julian Arias-Rodriguez, age 21, of Mexico and Jorge Patricio-Ocampo, age 35, of Mexico, with illegal reentry of a removed alien.
If convicted of illegal reentry, Arias-Rodriguez, previously deported four times and found in Harnett County, and Patricio-Ocampo, previously deported twice and found in Wake County would face a maximum imprisonment term of two years, a $250,000 fine, and a term of supervised release following any term of imprisonment.
Robert J. Higdon, Jr., U.S. Attorney for the Eastern District of North Carolina made the announcement. ICE’s Enforcement and Removal Operations and Homeland Security Investigations are investigating the case.
An indictment is merely an accusation. The defendant is presumed innocent until proven guilty.
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The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Three indicted on fentanyl-related chargesRead the Press Release
HOUSTON – Two Texas men are set to appear in federal court on charges of drug distribution that resulted in an overdose, announced U.S. Attorney Ryan K. Patrick.
A federal grand jury returned the nine-count superseding indictment against Joseph Raymond Weeks, 33, Katy, and Rhett Dwayne Farrell, 40, Pinehurst, Wednesday, July 1. They are expected to appear for their arraignment before U.S. Magistrate Judge Dena H. Palermo today at 2 p.m. Also charged is Jessica Wickman-Cano, 35, Katy, who is set to appearance today.
All were initially charged by criminal complaint on related offenses. They appeared before a U.S. magistrate judge who had ordered Weeks and Farrell into custody pending further criminal proceedings. Wickman-Cano was also initially remanded to custody, but was later granted release upon posting bond.
The new charges in the superseding indictment stem from an investigation into the drug overdose of a Montgomery County man. On Feb. 25, law enforcement and emergency personnel responded to an individual who was passed out in his vehicle, according to the charges. He was allegedly unresponsive, and they had to administer NARCAN to revive him.
The indictment alleges the man had overdosed on fentanyl and had purchased it from Farrell. Weeks was allegedly the source of supply.
The nine-count superseding indictment charges Weeks and Farrell with two counts each of conspiracy and possession with intent to distribute controlled substances which resulted in serious bodily injury. Additionally, Weeks and Wickman are charged with one count of possession with intent to distribute a controlled substance and one count of conspiracy to do the same, while Farrell is charged with two additional counts of possession with intent to distribute a controlled substance. Weeks is also charged with one count of being a felon in possession of a firearm.
If convicted, Weeks and Farrell face up to life in prison, while Wickman faces up to 20 years. All three could also be required to pay up to $1 million in fines.
Texas Department of Public Safety conducted the investigation with the assistance of the Drug Enforcement Administration, Montgomery County Narcotics Enforcement Team and police departments in Katy and Houston. Assistant U.S. Attorneys Jimmy Leo, Michael Day and Christine Lu are prosecuting the case.
An indictment is a formal accusation of criminal conduct, not evidence. A defendant is presumed innocent unless convicted through due process of law.
Three Oregon Men Sentenced to Federal Prison for Illegal Firearm Possession (Photo)Read the Press Release
PORTLAND, Ore.—In separate criminal cases, three men, Mitch Bryan Schoonover, 37, of Portland; Isaiah Holt, 32, also of Portland; and Jay Rodney Ferdig, 44, of Salem, Oregon; were sentenced this week to federal prison for illegally possessing firearms as convicted felons, announced U.S. Attorney Billy J. Williams.
“The goal of the Project Safe Neighborhoods program is to reduce violent crime and victimization across Oregon,” said U.S. Attorney Williams. “A key pillar of our strategy is to reduce illegal gun ownership. With the assistance of our federal, state, local, and tribal law enforcement partners, we have made significant progress toward this goal.”
U.S. v. Schoonover
On July 6, 2020, Schoonover was sentenced to 18 months in prison and three years’ supervised release. According to court documents, on January 1, 2020, Gresham Police officers stopped Schoonover for a traffic violation and on suspicion that the vehicle he was driving was stolen. Officers searched the vehicle after confirming it was stolen and found a .45 caliber semiautomatic pistol, a loaded magazine, and a clear glass pipe containing methamphetamine residue.
In 2005, after learning that another man had spent the night with his girlfriend, Schoonover shot and killed the man at short range with a rifle. He was convicted in Multnomah County Circuit Court of first degree manslaughter and sentenced to 15 years in state prison.
This case was investigated by the Gresham Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). It was prosecuted by Assistant U.S. Attorney Lewis S. Burkhart.
U.S. v. Ferdig
Ferdig was sentenced today to 30 months in prison and three years’ supervised release. According to court documents, on August 2, 2019, Ferdig and his fiancée were staying at a Salem motel with their 11-month- and three-year-old children. They left both children in the care of an extremely intoxicated cousin and went to a local park to inject methamphetamine. The children wandered away and a motel guest brought both children inside for their protection and to prevent the three-year-old from running into the street. During a subsequent welfare check, police discovered the children were barefoot and had not had their diapers changed for hours. Ferdig and his fiancée were arrested upon their return to the motel.
Police discovered drug packaging on Ferdig’s person and a .22 caliber pistol with a round in the chamber, two boxes of ammunition, plastic bags with shards of methamphetamine, two digital scales, hypodermic needles, and a stun gun in his vehicle.
Ferdig’s criminal history spans more than two decades. He is prohibited from possessing a firearm after numerous felony convictions for assault, sex offenses, drug offenses, robbery, burglary, and other crimes.
This case was investigated by the Salem Police Department and prosecuted by Assistant U.S. Attorney Byron G. Chatfield.
U.S. v. Holt
Holt was sentenced today to 37 months in prison and three years’ supervised release for money laundering, drug trafficking, and illegally possessing a firearm as a convicted felon. According to court documents, beginning in July 2016 and continuing until his arrest in April 2018, Holt used his association with a licensed marijuana producer in Portland to divert state-legal marijuana into the black market. Holt sold marijuana in-person to out-of-state customers traveling to Oregon and by mail to remote customers using the U.S. Postal Service.
The investigation started when Holt directed his girlfriend to purchase a handgun for him. In April 2018, ATF agents obtained and executed a search warrant on Holt’s Northeast Portland residence. They found 11.5 grams of cocaine and nearly $2,000 in cash on Holt’s person and three firearms, drug packaging materials, shipping labels, 14 pounds of marijuana, and $46,100 in cash in the residence.
After his arrest and federal indictment, Holt continued to distribute cocaine. From April to August 2019, law enforcement conducted three controlled purchases of cocaine from Holt. In total, law enforcement purchased or recovered from Holt approximately 158 grams of cocaine during these purchases.
Holt is prohibited from possessing a firearm after several felony convictions in Multnomah County Circuit Court in 2007 for selling marijuana and shooting an individual during an altercation.
This case was investigated by ATF, the U.S. Drug Enforcement Administration, and the Portland Police Bureau. It was prosecuted by Assistant U.S. Attorneys Julia E. Jarrett and Leah K. Bolstad.
These cases were brought as part of Project Safe Neighborhoods (PSN). PSN is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
Schoonover Firearm Ferdig Firearm Holt FirearmThird Member of Internet Romance Fraud Scheme to Serve 102 Months in Federal PrisonRead the Press Release
Oklahoma City, Oklahoma – NNAMDI FRANKLIN OJIMBA, 36, currently from Chicago, Illinois, has been sentenced to 102 months in federal prison for his role in a fraudulent romance scheme involving victims throughout the United States, announced Timothy J. Downing, U.S. Attorney for the Western District of Oklahoma.
On October 17, 2017, a grand jury indicted Ojimba for conspiracy and wire fraud. According to the indictment, the scheme involved using false profiles to open accounts on online dating websites and then courting victims by pretending to be successful financial advisors or affiliated with charitable causes. Over time, through supposedly romantic relationships, the defendant and others caused victims to share personal information about their finances and then encouraged victims to wire them money on the pretext of managing their investments. The conspirators actually kept the money for personal use. Ojimba was arrested in Chicago in October, 2017. After a jury failed to reach a unanimous decision in October, 2018, Ojimba was re-tried on the conspiracy count in August 2019 and was convicted by a jury. He has been in federal custody since his conviction.
Yesterday, Chief United States Judge Timothy D. DeGiusti sentenced Ojimba to 102 months in prison, followed by three years of supervised release. He was also ordered to pay restitution totaling almost $3.5 million.
Two other participants in the scheme were convicted separately. In 2017, KEN EJIMIFOR EZEAH, 38, of Houston, Texas, was sentenced to 11 years in prison following a plea of guilty. AKUNNA BAIYINA EJIOFOR, 36, also of Houston, was sentenced to a prison term of 7 years after being convicted at trial. For more information, please see https://www.justice.gov/usao-wdok/pr/two-sentenced-11-and-7-years-federal-prison-46-million-internet-romance-fraud.
The case was the result of an investigation by the Oklahoma City office of the Federal Bureau of Investigation. The case was prosecuted by Assistant U.S. Attorney Timothy W. Ogilvie.
Texas Man Pleads Guilty to Trafficking WildlifeRead the Press Release
A Texas man pleaded guilty today in federal court in the Western District of Texas on charges of conspiring to traffic thousands of live reptiles, amphibians, and birds, valued in excess of $3.5 million.
Alejandro Carrillo of El Paso, Texas, pleaded guilty before Senior U.S. District Judge David Briones for the Western District of Texas. Sentencing has been scheduled for Sept. 16.
“Carrillo’s arrest and his removal from the trafficking network demonstrates that the Justice Department will continue to vigorously enforce laws designed to protect wildlife,” said Assistant Attorney General Jeffrey Bossert Clark of the Justice Department’s Environment and Natural Resources Division. “This is a continuing investigation and reflects the seriousness with which we regard these activities and our commitment to hold accountable those who break the law.”
“This investigation has exposed a highly coordinated wildlife trafficking ring responsible for the smuggling of wild caught reptiles destined to collectors and the commercial trade across the U.S. and globe,” said Edward Grace, Assistant Director for Law Enforcement for the U.S. Fish and Wildlife Service (FWS). “The number of animals suspected of being smuggled is in the tens of thousands. Reptiles, amphibians and other protected wildlife already face enough environmental stressors worldwide. This case goes a long way to slow the impacts of wildlife trafficking on species that are under protection of the Endangered Species Act and CITES.”
According to documents filed with the court, beginning in 2016, the FWS undertook Operation Bale Out, an investigation of a network of individuals involved in the trafficking of wildlife between the United States and Mexico. “Bale” means a group of turtles, and much of the wildlife trafficked by this network involved rare turtles.
According to information in the public record, Carrillo functioned as a middle-man for the network, transporting live animals – many of which were protected under the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) – from Mexico into the United States. Carrillo pleaded guilty to two counts of an indictment charging him with conspiring to traffic wildlife into the United States, and smuggling wildlife into the United States. As part of the plea, Carrillo admitted to being paid more than $92,000 to transport thousands of animals from Mexico into the United States, valued at more than $3,500,000. After transporting the animals into the United States, Carrillo then arranged for them to be delivered to domestic customers, who had purchased the animals from the Mexico-based suppliers.
This case is part of an ongoing effort by the Department of the Interior’s Fish and Wildlife Service Office of Law Enforcement, in coordination with the Department of Justice, to prosecute those involved in the illegal taking and trafficking in protected species. This prosecution is being handled by the Environment and Natural Resources Division’s Environmental Crimes Section with assistance from the U.S. Attorney’s Office for the Western District of Texas. The government is represented by Environmental Crimes Trial Attorneys Mary Dee Carraway and Gary N. Donner.
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.
Telemedicine company owner pleads guilty to telemedicine fraud conspiracyRead the Press Release
SAVANNAH, GA: A Georgia woman who operated a telemedicine network through two companies has admitted to participation in an ever-growing healthcare and telemedicine fraud scheme.
Charlene Frame, the operator of Royal Physician Network, LLC, and Envision It Perfect, LLC, both Georgia companies, pled guilty in U.S. District Court to a charge of Conspiracy for conspiring to pay medical providers, such as physicians and nurse practitioners, in exchange for obtaining orders for durable medical equipment (DME) that would then be sold to DME providers and, ultimately, billed to Medicare, said Bobby L. Christine, U.S. Attorney for the Southern District of Georgia.
The financial total for orders facilitated through this scheme is alleged in court documents to be in excess of $60 million for thousands of patient orders. Medicare beneficiaries were located in the Southern District of Georgia and elsewhere.
“Charlene Frame used her network of companies to blatantly defraud the government’s insurance safety net for seniors,” said U.S. Attorney Christine. “We will not tolerate such greed-fueled theft from these programs, and will continue to root out these despicable frauds.”
This prosecution, arising out of the related “Operation Brace Yourself” and “Operation Double Helix,” together with 25 other previously announced 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, two other operators of different telemedicine companies, three brokers of patient data, and several 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.
“Frame’s fraud scheme of $60-million has put tremendous strain on our federally-subsidized health care programs and it is only a small part of a much larger operation,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “She will be held accountable for her greed and the affect it has had on our tax paying citizens, especially those who need government assistance for their health care needs.”
“Paying kickbacks in exchange for patient referrals is a dangerous and illegal practice,” said Derrick L. Jackson, Special Agent in Charge at the U.S. Department of Health and Human Services, Office of Inspector General in Atlanta. “The OIG, in concert with our law enforcement partners, is dedicated to ensuring that patient referrals are based on sound medical advice and not financial remuneration.”
“This type of corruption involving health care fraud against Medicare has managed to defraud American taxpayers of millions upon millions of dollars,” said Resident Agent in Charge Glen M. Kessler of the U.S. Secret Service. “The U.S. Secret Service and our partners are always willing to take prompt and coordinated actions to hold these telemarketers and medical professionals responsible for placing personal greed above the good of the public, particularly in light of our nation’s current struggles with the COVID-19 pandemic.”
This investigation is ongoing. As telemedicine becomes an increasing part of our healthcare system, 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. Attorney Jonathan A. Porter is prosecuting this case on behalf of the United States.
Selling Two Pounds of Methamphetamine Results in over a Dozen Years in Federal PrisonRead the Press Release
A man who sold at least two pounds of meth was sentenced July 8, 2020, to more than twelve years in federal prison.
Paul Gensley, age 52, from Victor, Iowa, received the prison term after a December 2, 2019 guilty plea to conspiracy to distribute drugs. In a plea agreement, Gensley admitted he agreed to work with at least one other person to distribute drugs in northern Iowa. Testimony during previous hearings in the case showed that Gensley’s source of meth was arrested and jailed, but continued to participate in the conspiracy. While in jail, the source provided a pound of meth to Gensley. Gensley was captured on jail phone recordings talking to his source and later sold methamphetamine to a confidential informant. Evidence showed Gensley sold at least two pounds of meth overall and provided a gun to another participant in the conspiracy. Gensley has multiple previous felony convictions involving stolen property. Law enforcement recently recovered a stolen motorcycle and golf cart from his house.
Gensley was sentenced in Cedar Rapids by United States District Court Judge C.J. Williams. Gensley was sentenced to 150 months’ and 20 days imprisonment. He must also serve a five-year term of supervised release after the prison term. There is no parole in the federal system. Gensley 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 Emily K. Nydle and through a cooperative effort of the Iowa Division of Narcotics Enforcement and the Iowa County Sheriff’s Office.
Court file information is available at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 19-cr-86.
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San Diego, California Man Sentenced to Federal Prison for His Role in Million Dollar Scheme Targeting Thousands of U.S. Servicemembers and VeteransRead the Press Release
In San Antonio, a federal judge sentenced 33-year-old Trorice Crawford of San Diego, California, to 46 months in federal prison for his role in an identity-theft and fraud scheme that victimized thousands of U.S. servicemembers and veterans, announced U.S. Attorney John F. Bash and Director Gustav Eyler of the Department of Justice’s Consumer Protection Branch.
In addition to the prison term, Chief U.S. District Judge Orlando Garcia ordered that Crawford pay $103,700 in restitution and be placed on supervised release for a period of three years after completing his prison term.
“The Department of Justice will not tolerate fraud on America’s warfighters and veterans,” said Acting Assistant Attorney General Ethan P. Davis of the Department’s Civil Division. “Working with our partners and using all tools available, we are committed to protecting those who protect us.”
On December 5, 2019, Crawford pleaded guilty to one count of conspiracy to launder monetary instruments. By pleading guilty, Crawford admitted that from May 2017 to July 2019, he conspired with Robert Wayne Boling, Jr. (a U.S. citizen), and others to steal money belonging to U.S. Servicemembers and veterans. By pleading guilty, Crawford admitted to recruiting at least 30 individuals (aka “money mules”) who provided their bank account information to receive funds stolen from military affiliated individuals. On average, each unauthorized transfer from a victim’s accounts ranged from between $8,000 to $13,000. Crawford kept a percentage of the withdrawn funds for himself and oversaw the transmission of the remaining amounts by means of international money remittance services to Boling and others in the Philippines.
In October, co-defendant Frederick Brown, age 38 of Las Vegas, NV, pleaded guilty to federal charges in connection with this scheme. Brown, a former civilian medical records administrator for the U.S. Army at the 65th Medical Brigade, Yongsan Garrison, South Korea, admitted that while logged into the Armed Forces Health Longitudinal Technology Application, he illegally captured on his cell phone personal identifying information (PII) of thousands of military members, including names, social security numbers, DOD ID numbers, dates of birth, and contact information. Brown further admitted that he subsequently provided that stolen data to Boling so that Boling and others could exploit the information in various ways to access Department of Defense and Veterans Affairs benefits sites and steal millions of dollars.
As asserted in the federal grand jury indictment, Boling, together with his Philippines-based co-defendants Allan Albert Kerr (Australian citizen) and Jongmin Seok (South Korean citizen), specifically used the stolen information to compromise a Department of Defense portal designed to enable military members to access benefits information online. Once through the portal, the defendants are alleged to have accessed benefits information. Access to these detailed records enabled the defendants to steal or attempt to steal millions of dollars from military members’ bank accounts. The defendants also stole veterans’ benefits payments. Evidence of the defendants’ scheme was detected earlier this year, advancing the investigation that led to the indictment.
The Departments of Defense and Veterans Affairs are coordinating with the Department of Justice to notify and provide resources to the thousands of identified victims.
Boling, Kerr and Seok are charged with multiple counts of conspiracy, wire fraud, and aggravated identity theft. Boling, Kerr and Seok remain in the Philippines. Measures are being taken to effect their transfer to the Western District of Texas. Brown remains in federal custody awaiting sentencing scheduled for 10:30am on September 17, 2020, before Judge Garcia in San Antonio.
It is important to note that an indictment merely alleges that crimes have been committed. All defendants are presumed innocent until proven guilty beyond a reasonable doubt.
The United States is represented by Trial Attorneys Ehren Reynolds and Yolanda McCray Jones of the Department of Justice’s Consumer Protection Branch and Assistant U.S. Attorney Joseph Blackwell of the U.S. Attorney’s Office for the Western District of Texas. The matter was investigated by agents of the Defense Criminal Investigative Service, and counsel Matthew Freund, along with substantial investigative support from the U.S. Postal Inspection Service, the U.S. Army Criminal Investigation Command, and the Veterans Benefits Administration’s Benefits Protection and Remediation Division. The U.S. Department of State’s Diplomatic Security Service, Philippine law enforcement partners, and the U.S. Attorneys’ Offices for the District of Nevada, the Southern District of California, and the Eastern District of Virginia also provided assistance. Resources from the Department of Justice’s Servicemembers and Veterans Initiative and its Transnational Elder Fraud Strike Force aided in the matter’s investigation and prosecution.
Since President Trump signed the bipartisan Elder Abuse Prevention and Prosecution Act (EAPPA) into law, the Department of Justice has participated in hundreds of enforcement actions in criminal and civil cases that targeted or disproportionately affected seniors. In particular, in March 2020, the Department announced the largest elder fraud enforcement action in American history, charging more than 400 defendants in a nationwide elder fraud sweep. The Department has likewise conducted hundreds of trainings and outreach sessions across the country since the passage of the Act.
Additional information about the Consumer Protection Branch and its enforcement efforts can be found at www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the Western District of Texas, visit its website at https://www.justice.gov/usao-wdtx. Information about the Department of Justice’s Elder Fraud Initiative is available at www.justice.gov/elderjustice; information on the Servicemember and Veterans Initiative is at https://www.justice.gov/servicemembers.
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The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
San Diego, California Man Sentenced to Federal Prison for His Role in Million Dollar Scheme Targeting Thousands of U.S. Servicemembers and VeteransRead the Press Release
A federal judge in San Antonio sentenced 32-year-old Trorice Crawford of San Diego, California, to 46 months in federal prison for his role in an identity-theft and fraud scheme that victimized thousands of U.S. servicemembers and veterans, the Department of Justice announced today.
In addition to the prison term, Chief U.S. District Judge Orlando Garcia ordered that Crawford pay $103,700 in restitution and be placed on supervised release for a period of three years after completing his prison term.
On December 5, 2019, Crawford pleaded guilty to one count of conspiracy to launder monetary instruments. By pleading guilty, Crawford admitted that from May 2017 to July 2019, he conspired with Robert Wayne Boling, Jr. (a U.S. citizen), and others to steal money belonging to U.S. Servicemembers and veterans. By pleading guilty, Crawford admitted to recruiting at least 30 individuals (aka “money mules”) who provided their bank account information to receive funds stolen from military affiliated individuals. On average, each unauthorized transfer from a victim’s accounts ranged from between $8,000 to $13,000. Crawford kept a percentage of the withdrawn funds for himself and oversaw the transmission of the remaining amounts by means of international money remittance services to Boling and others in the Philippines.
“The Department of Justice will not tolerate fraud on America’s warfighters and veterans,” said Acting Assistant Attorney General Ethan P. Davis of the Department’s Civil Division. “Working with our partners and using all tools available, we are committed to protecting those who protect us.”
In October, Crawford’s co-defendant Frederick Brown, age 38 of Las Vegas, NV, pleaded guilty to federal charges in connection with this scheme. Brown, a former civilian medical records administrator for the U.S. Army at the 65th Medical Brigade, Yongsan Garrison, South Korea, admitted that while logged into the Armed Forces Health Longitudinal Technology Application, he illegally captured on his cell phone personal identifying information (PII) of thousands of military members, including names, social security numbers, DOD ID numbers, dates of birth, and contact information. Brown further admitted that he subsequently provided that stolen data to Boling so that Boling and others could exploit the information in various ways to access Department of Defense and Veterans Affairs benefits sites and steal millions of dollars.
As asserted in the federal grand jury indictment, Boling, together with his Philippines-based co-defendants Allan Albert Kerr (Australian citizen) and Jongmin Seok (South Korean citizen), specifically used the stolen information to compromise a Department of Defense portal designed to enable military members to access benefits information online. Once through the portal, the defendants are alleged to have accessed benefits information. Access to these detailed records enabled the defendants to steal or attempt to steal millions of dollars from military members’ bank accounts. The defendants also stole veterans’ benefits payments. Evidence of the defendants’ scheme was detected earlier this year, advancing the investigation that led to the indictment.
The Departments of Defense and Veterans Affairs are coordinating with the Department of Justice to notify and provide resources to the thousands of identified victims.
Boling, Kerr, and Seok are charged with multiple counts of conspiracy, wire fraud, and aggravated identity theft. Boling, Kerr, and Seok remain in the Philippines. Measures are being taken to effect their transfer to the Western District of Texas. Brown remains in federal custody awaiting sentencing scheduled for 10:30 am on September 17, 2020, before Judge Garcia in San Antonio.
It is important to note that an indictment merely alleges that crimes have been committed. All defendants are presumed innocent until proven guilty beyond a reasonable doubt.
The United States is represented by Trial Attorneys Ehren Reynolds and Yolanda McCray Jones of the Department of Justice Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney Joseph Blackwell of the U.S. Attorney’s Office for the Western District of Texas. The matter was investigated by agents of the Defense Criminal Investigative Service, and counsel Matthew Freund, along with substantial investigative support from the U.S. Postal Inspection Service, the U.S. Army Criminal Investigation Command, and the Veterans Benefits Administration’s Benefits Protection and Remediation Division. The U.S. Department of State’s Diplomatic Security Service, Philippine law enforcement partners, and the U.S. Attorneys’ Offices for the District of Nevada, the Southern District of California, and the Eastern District of Virginia also provided assistance. Resources from the Department of Justice’s Servicemembers and Veterans Initiative and its Transnational Elder Fraud Strike Force aided in the matter’s investigation and prosecution.
Since President Trump signed the bipartisan Elder Abuse Prevention and Prosecution Act (EAPPA) into law, the Department of Justice has participated in hundreds of enforcement actions in criminal and civil cases that targeted or disproportionately affected seniors. In particular, in March 2020, the department announced the largest elder fraud enforcement action in American history, charging more than 400 defendants in a nationwide elder fraud sweep. The department has likewise conducted hundreds of training's and outreach sessions across the country since the passage of the Act.
Additional information about the Consumer Protection Branch and its enforcement efforts can be found at www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the Western District of Texas, visit its website at https://www.justice.gov/usao-wdtx. Information about the Department of Justice’s Elder Fraud Initiative is available at www.justice.gov/elderjustice; information on the Servicemember and Veterans Initiative is at https://www.justice.gov/servicemembers.
Romanian Programmer Admits that He Helped Create Bitclub Network, a Fraud Scheme Worth at Least $722 MillionRead the Press Release
NEWARK, N.J. – A Romanian man arrested in Germany admitted today to conspiring to engage in wire fraud and offering and selling unregistered securities in connection with his role in the BitClub Network, a cryptocurrency mining scheme worth at least $722 million, U.S. Attorney Craig Carpenito announced.
Silviu Catalin Balaci, 35, a Romanian citizen who was living in Germany, pleaded guilty by videoconference before U.S. District Judge Claire C. Cecchi to a superseding information charging him with one count of a dual-object conspiracy to commit wire fraud and to offer and sell unregistered securities. Balaci and four co-defendants – Matthew Brent Goettsche, Russ Albert Medlin, Jobadiah Sinclair Weeks, and Joseph Frank Abel – were charged previously by indictment in December 2019 in connection with the scheme.
According to documents filed in this case and statements made in court:
From April 2014 through December 2019, the BitClub Network was a fraudulent scheme that solicited money from investors in exchange for shares of purported cryptocurrency mining pools and rewarded investors for recruiting new investors into the scheme. Balaci assisted Goettsche and Medlin in creating and operating the BitClub Network and served as a programmer for the BitClub Network.
As a part of the scheme, Balaci and Goettsche discussed that the target audience for the BitClub Network would be “dumb” investors, referred to them as “sheep,” and plotted that they would be “building this whole model on the backs of idiots.” The BitClub Network told investors that they could invest in three different bitcoin mining pools; however, Balaci admitted that, at no point during the conspiracy was he aware of the BitClub Network operating three separate bitcoin mining pools. Balaci admitted that he, at Goettsche’s behest, changed the figures displayed as bitcoin mining earnings to make it appear that the BitClub Network was earning more than what was actually being mined. For example, in February 2015, Goettsche directed Balaci to “bump up the daily mining earnings starting today by 60%,” to which Balaci warned “that is not sustainable, that is ponzi teritori [sic] and fast cash-out ponzi . . . but sure.” In connection with his plea, Balaci confirmed that during the course of the scheme, the BitClub Network took at least $722 million worth of bitcoin from investors.
The charge to which Balaci pleaded guilty carries a maximum penalty of five years in prison and a fine of $250,000, or twice the pecuniary gain to the defendant or loss to the victims. A sentencing date has not been set.
U.S. Attorney Carpenito credited special agents and task force officers of the FBI Los Angeles Division’s West Covina Resident Agency, under the direction of Assistant Director in Charge Paul D. Delacourt; special agents of IRS - Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez in Newark; special agents of the IRS Los Angeles Field Office, under the direction of Special Agent in Charge Ryan L. Korner; and the FBI Criminal Investigative Division, under the supervision of Assistant Director Calvin A. Shivers and the Financial Crimes Section, under the leadership of Section Chief Steven Merrill, with the investigation leading to today’s guilty plea. He also thanked the Department of Justice’s Office of International Affairs and German authorities for their assistance.
Anyone who believes they may be a victim may visit www.justice.gov/usao-nj/bitclub or the Department of Justice’s large case website www.justice.gov/largecases. There, victims can find more information about the case, including a questionnaire for victims to fill out and submit.
The government is represented by Unit Chief David W. Feder, Assistant U.S. Attorneys Jamie L. Hoxie and Anthony P. Torntore of the Cybercrime Unit, and Unit Chief Sarah Devlin and Assistant U.S. Attorney Joseph Minish of the Asset Recovery and Money Laundering Unit, of the U.S. Attorney’s Office in Newark.
Ridgeland Man Pleads Guilty to Illegally Possessing a Machine GunRead the Press Release
Jackson, Miss – Timothy Lakendrick Liddell, 25, of Ridgeland, pled guilty yesterday before U.S. District Court Judge Carlton W. Reeves to illegally possessing a machine gun, announced U.S. Attorney Mike Hurst and Kurt Thielhorn, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms, and Explosives.
On October 11, 2018, Ridgeland Police officers and Mississippi Bureau of Narcotics agents searched Liddell’s apartment pursuant to a search warrant. In addition to finding illegal narcotics, investigators and agents discovered a Glock model 19 handgun that had been converted to a machine gun. The gun was also equipped with a high-capacity magazine capable of holding 31 rounds.
On July 10, 2019, Liddell was charged in a federal criminal indictment with possessing a machine gun and possessing a firearm that was not registered to him in the National Firearms Registration and Transfer Record.
Liddell will be sentenced by Judge Reeves on October 7, 2020 at 9:00 a.m. He faces a statutory penalty of up to 10 years in prison and a $250,000 fine.
This case was investigated by the Ridgeland Police Department, the Mississippi Bureau of Narcotics, and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. It is being prosecuted by Assistant United States Attorney Bert Carraway.
Researcher charged with illegally using U.S. grant funds to develop scientific expertise for ChinaRead the Press Release
COLUMBUS, Ohio – A rheumatology professor and researcher with strong ties to China has been ordered held without bond to face a charge of grant fraud for not disclosing that he was engaged in a sophisticated scheme to use approximately $4.1 million in grants from the National Institutes of Health (NIH) to develop China’s expertise in the areas of rheumatology and immunology. He is also charged with making false statements about maintaining employment in China at the same time he was employed at universities in the United States, including The Ohio State University.
Song Guo Zheng, 57, was arrested Friday, May 22, 2020, after he arrived in Anchorage, Alaska, aboard a charter flight and as he prepared to board another charter flight to China. When he was arrested, he was carrying three large bags, one small suitcase and a briefcase containing two laptops, three cellular telephones, several USB drives, several silver bars, expired Chinese passports for his family, deeds for property in China and other items.
“Yet again, we are faced with a professor at a U.S. University, who is a member of a Chinese Talent Plan, allegedly and deliberately failing to disclose his relationship with a Chinese university and receipt of funds from the Chinese Government in order to obtain millions of dollars in U.S. grant money designed to benefit the health and well-being of the people of the United States — not to be hijacked to supplement the research goals of the Chinese Communist Party,” said Assistant Attorney General for National Security John C. Demers. “This case, like too many others, should serve as a reminder that the United States Government takes seriously the obligation of truthfulness and transparency on grant applications, and those who violate the law to benefit China or any other foreign nation will be held accountable.”
"This case highlights another example of a Chinese Talent Plan member allegedly using U.S. taxpayer funds for the benefit of the Chinese government," said Alan E. Kohler, Jr, Assistant Director of the FBI's Counterintelligence Division. "According to the criminal complaint, Zheng violated laws concerning the use of federal research funds and did not disclose his employment in China. The FBI will continue to work with our partners to stop such illegal activity and protect U.S. research."
“We allege that Zheng was preparing to flee the country after he learned that his employer had begun an administrative process into whether or not he was complying with rules governing taxpayer-funded grants,” said David M. DeVillers, U.S. Attorney for the Southern District of Ohio. “This is our office’s third recent case involving the illegal transfer of intellectual property and research to China. This underscores our commitment to work with the FBI, the Department of Health and Human Services, and our research institutions to protect our country’s position as a global leader in research and innovation, and to punish those who try to exploit and undermine that position.”
"The taxpayers of the United States are the real victims when researchers defraud our government and exploit our system to benefit China,” stated FBI Cincinnati Special Agent in Charge Chris Hoffman. “The cutting-edge technologies that are being developed in our country must be carefully protected from our foreign adversaries and the FBI will continue to work with our partners to safeguard these important innovations.”
A criminal complaint filed May 23 and unsealed following today’s detention hearing charges Zheng with one count of fraud or bribery concerning programs receiving federal funds, a crime punishable by up to ten years in prison, and one count of making false statements, which is punishable by up to five years in prison. Magistrate Judge Elizabeth Preston Deavers ordered Zheng held without bond because he is a flight risk. The case will be presented to a federal grand jury for possible indictment. The investigation is continuing.
An affidavit filed with the complaint alleges that, since 2013, Zheng has been participating in a Chinese Talent Plan, a program established by the Chinese government to recruit individuals with knowledge or access to foreign technology intellectual property. Since then, Zheng has used research conducted in the U.S. to benefit the People’s Republic of China. Zheng allegedly failed to disclose conflicts of interest or his foreign commitments to his U.S. employers or to the NIH.
Assistant Attorney General for National Security John C. Demers, U.S. Attorney DeVillers, and Christopher Hoffman, Special Agent in Charge, FBI, Cincinnati Field Division announced the criminal complaint, and acknowledged the assistance of the Anchorage FBI Division who arrested Zheng, interviewed him and executed multiple warrants while he was detained, and the assistance provided by the U.S. Attorney's Office for the District of Alaska. Assistant U.S. Attorneys Douglas W. Squires and Courter Shimeall, Special Assistant U.S. Attorney Christopher St. Pierre, and Trial Attorney Matthew J. McKenzie with the Department of Justice National Security Division are representing the United States in this case.
A criminal complaint merely contains allegations. All defendants are presumed innocent unless proven guilty in a court of law.
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Researcher Charged with Illegally Using U.S. Grant Funds to Develop Scientific Expertise for ChinaRead the Press Release
A rheumatology professor and researcher with strong ties to China has been ordered held without bond to face a charge of grant fraud for not disclosing that he was engaged in a sophisticated scheme to use approximately $4.1 million in grants from the National Institutes of Health (NIH) to develop China’s expertise in the areas of rheumatology and immunology. He is also charged with making false statements about maintaining employment in China at the same time he was employed at universities in the United States, including The Ohio State University.
Song Guo Zheng, 57, was arrested Friday, May 22, 2020, after he arrived in Anchorage, Alaska, aboard a charter flight and as he prepared to board another charter flight to China. When he was arrested, he was carrying three large bags, one small suitcase and a briefcase containing two laptops, three cellular telephones, several USB drives, several silver bars, expired Chinese passports for his family, deeds for property in China and other items.
“Yet again, we are faced with a professor at a U.S. University, who is a member of a Chinese Talent Plan, allegedly and deliberately failing to disclose his relationship with a Chinese university and receipt of funds from the Chinese Government in order to obtain millions of dollars in U.S. grant money designed to benefit the health and well-being of the people of the United States — not to be hijacked to supplement the research goals of the Chinese Communist Party,” said Assistant Attorney General for National Security John C. Demers. “This case, like too many others, should serve as a reminder that the United States Government takes seriously the obligation of truthfulness and transparency on grant applications, and those who violate the law to benefit China or any other foreign nation will be held accountable.”
"This case highlights another example of a Chinese Talent Plan member allegedly using U.S. taxpayer funds for the benefit of the Chinese government," said Alan E. Kohler, Jr, Assistant Director of the FBI's Counterintelligence Division. "According to the criminal complaint, Zheng violated laws concerning the use of federal research funds and did not disclose his employment in China. The FBI will continue to work with our partners to stop such illegal activity and protect U.S. research."
“We allege that Zheng was preparing to flee the country after he learned that his employer had begun an administrative process into whether or not he was complying with rules governing taxpayer-funded grants,” said David M. DeVillers, U.S. Attorney for the Southern District of Ohio. “This is our office’s third recent case involving the illegal transfer of intellectual property and research to China. This underscores our commitment to work with the FBI, the Department of Health and Human Services, and our research institutions to protect our country’s position as a global leader in research and innovation, and to punish those who try to exploit and undermine that position.”
"The taxpayers of the United States are the real victims when researchers defraud our government and exploit our system to benefit China,” stated FBI Cincinnati Special Agent in Charge Chris Hoffman. “The cutting-edge technologies that are being developed in our country must be carefully protected from our foreign adversaries and the FBI will continue to work with our partners to safeguard these important innovations.”
A criminal complaint filed May 23 and unsealed following today’s detention hearing charges Zheng with one count of fraud or bribery concerning programs receiving federal funds, a crime punishable by up to ten years in prison, and one count of making false statements, which is punishable by up to five years in prison. Magistrate Judge Elizabeth Preston Deavers ordered Zheng held without bond because he is a flight risk. The case will be presented to a federal grand jury for possible indictment. The investigation is continuing.
An affidavit filed with the complaint alleges that, since 2013, Zheng has been participating in a Chinese Talent Plan, a program established by the Chinese government to recruit individuals with knowledge or access to foreign technology intellectual property. Since then, Zheng has used research conducted in the U.S. to benefit the People’s Republic of China. Zheng allegedly failed to disclose conflicts of interest or his foreign commitments to his U.S. employers or to the NIH.
Assistant Attorney General for National Security John C. Demers, U.S. Attorney DeVillers, and Christopher Hoffman, Special Agent in Charge, FBI, Cincinnati Field Division announced the criminal complaint. Assistant U.S. Attorneys Douglas W. Squires and Courter Shimeall, Special Assistant U.S. Attorney Christopher St. Pierre, and Trial Attorney Matthew J. McKenzie with the Department of Justice National Security Division are representing the United States in this case.
A criminal complaint merely contains allegations. All defendants are presumed innocent unless proven guilty in a court of law.
Recent Federal Tax Prosecutions in Minnesota Serve as Reminder to File and Pay Taxes by July 15 DeadlineRead the Press Release
The U.S. Attorney’s Office and the Internal Revenue Service’s Criminal Investigation Division reminds all Minnesotans that this year’s deadline for filing federal income tax returns is Wednesday, July 15. Due to COVID-19, the original filing deadline and tax payment due date was postponed from April 15 to July 15. For people facing hardships, including those affected by COVID-19, who cannot pay in full, the IRS has several options available on IRS.gov/payments. IRS Criminal Investigation also encourages Minnesotans to be cautious of scam artists who are looking for ways to steal money and personal information. Stay alert! The IRS will not contact you by phone, email, or social media to ask for personal information.
“Although we are living through unprecedented times, Americans must still meet their tax obligations by filing returns accurately and timely,” stated U.S. Attorney Erica MacDonald. “Minnesotans must also be aware of wrongdoers who are looking for ways to exploit individuals, steal money, and cheat the system. Those individuals will be held accountable.”
“As the tax filing deadline quickly approaches, I am asking all citizens to file correct and accurate tax returns and to pay their share of taxes,” states Kathy A. Enstrom, Special Agent in Charge of the IRS Criminal Investigation Division who oversees the state of Minnesota. “We all pay when others cheat the government. IRS Criminal Investigation, together with the U.S. Attorney’s Office, works year-round to make certain that those who willfully defy the tax laws will be investigated and criminally prosecuted. Taxpayers are encouraged to visit the IRS.gov website for tips on filing a tax return accurately and searching for a reputable return preparer.”
As the tax filing season winds down next week, the U.S. Attorney’s Office and IRS Criminal Investigation encourage taxpayers to think before filing a false or fraudulent tax return and to be wary of any schemes that falsify income or deductions. The following court actions have occurred in the District of Minnesota over the last nine months.
In October 2019, LESSIE BEATRICE LINDSEY was sentenced to a year and a day in federal prison for filing a false claim and ordered to pay $995,966 in restitution to the IRS. From 2013 to 2016, LINDSEY submitted approximately 192 false and fraudulent income tax returns acting as a knowledgeable tax preparer and illegally demanding a share of the tax refunds from her clients. Over $200,000 of her false tax refunds were designed to benefit herself, her boyfriend, or her relatives. This case was prosecuted by Assistant U.S. Attorney Matthew S. Ebert.
In December 2019, RICHARD PETER HENTGES was sentenced on charges of aiding and assisting in the filing of a false tax return and ordered to pay $55,634 in restitution to the IRS. While employed as the Chief Financial Officer of a business located in Chaska, Minnesota, HENTGES was responsible for all aspects of operations and finances, including filing and paying payroll taxes. During 2013 and 2014, HENTGES failed to pay over the payroll taxes for some of the employees resulting in a $72,672.01 tax loss to the United States. This case was prosecuted by Assistant U.S. Attorney Amber M. Brennan.
In January 2020, WORAPHAK VANG was sentenced to 18 months in prison for tax evasion and was ordered to pay $1,351,985.05 in restitution to the IRS. While operating her temporary staffing agency that provided temporary workers to companies in the manufacturing field in and around Saint Paul, VANG committed payroll and income tax fraud totaling $1,351,985.05 over a period of four years. VANG failed to collect and pay over payroll taxes from her employees and underreported her own income on her personal tax returns. This case was prosecuted by Assistant U.S. Attorney Robert M. Lewis.
In January 2020, RANDAL SCOT BRINKMAN was sentenced to 46 months in prison and was ordered to pay $945,316 in restitution to the IRS. On July 25, 2019, following a four-day jury trial, BRINKMAN was found guilty on six counts of tax evasion. From 1999 through 2018, BRINKMAN, owner of a Roseville construction company, took steps to hide his income and actively evade the assessment of taxes, including using sham businesses, closing his personal bank accounts, using money orders and cash to pay for daily expenses, and creating a fake religious organization in order to hide his income and assets. This case was prosecuted by Assistant U.S. Attorneys Joseph H. Thompson and Alexander D. Chiquione.
In February 2020 and March 2020, MUHUMED ALI and FAYSAL SAYID each pleaded guilty to one count of income tax evasion. SAYID and ALI were co-owners of a company that provided adult day care services to individuals enrolled in the Minnesota Medicaid program. Between 2012 and 2014, SAYID and ALI removed approximately $1.3 million from the company’s operating accounts and used those funds to pay for personal, non-business expenses, such as clothing, rent for personal residences, vehicles, funds transfers to other parties, and international wire transfers. SAYID and ALI willfully attempted to evade and defeat income taxes due and owing on that money for tax years 2012, 2013, and 2014. SAYID and ALI are awaiting sentencing. This case is being prosecuted by Assistant U.S. Attorney Matthew S. Ebert.
In May 2020, RUSLAN FURMAN was sentenced to two years in prison for aggravated identity theft and ordered to pay $298,644 in restitution to the IRS. From 2013 through 2016, FURMAN, a salesperson at a vehicle dealership, conspired with VLADIMIR CHEVTAYEV, THOMAS POPLAR, and others to defraud financial institutions out of money through an elaborate auto-financing scheme. FURMAN and others committed the fraud by applying for financing using deceased buyer’s names, stolen identities, or by paying people for the use of their information to buy luxury vehicles. After receiving the loan proceeds, the conspirators laundered the funds through an auto financing company to make the transactions appear legitimate. Co-conspirators CHEVTAYEV and POPLAR have pleaded guilty and are awaiting sentencing. This case is being prosecuted by Assistant U.S. Attorney Julie E. Allyn.
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Queens Man Sentenced to 70 Months for Trafficking Heroin and Oxycodone in the Capital RegionRead the Press Release
ALBANY, NEW YORK – Eric Soto, age 38, of Queens County, New York, was sentenced today to 70 months in prison for distributing and possessing with intent to distribute over 800 grams of heroin, and oxycodone pills, in June 2018 in various locations in Albany County.
The announcement was made by United States Attorney Grant C. Jaquith and Special Agent in Charge Ray Donovan of the U.S. Drug Enforcement Administration (DEA), New York Division.
Soto was also ordered to serve a 4-year term of supervised release following his release from prison, and to forfeit $19,960 in proceeds from his drug trafficking activity.
In imposing sentence, the Court found that in June 2018, Soto travelled from New York City to the Capital Region on three occasions for the purpose of distributing both heroin and oxycodone at various locations in Albany County, including in Colonie, Guilderland and Watervliet. On June 22, 2018, he was arrested in a mall parking lot in possession of 583 grams of heroin and 99 oxycodone pills, which he intended to sell. He has remained in custody since his arrest.
This case was investigated by the DEA, with assistance from the Albany County Sheriff’s Office, and the Police Departments of Colonie, Guilderland and Watervliet. The case was prosecuted by Assistant U.S. Attorney Emmet O’Hanlon.
Proposed Settlement with United States and Major Fertilizer Producer will Reduce Acidic Wastewater Generation and Enhance Phosphate RecoveryRead the Press Release
The U.S. Department of Justice and U.S. Environmental Protection Agency (EPA) today announced a settlement with J.R. Simplot Company and its subsidiary, Simplot Phosphates LLC (Simplot), involving Simplot’s Rock Springs, Wyoming, manufacturing facility.
This settlement resolves allegations under the Resource Conservation and Recovery Act (RCRA) at the facility, including that Simplot failed to properly identify and manage certain waste streams as hazardous wastes. The settlement requires Simplot to implement process modifications designed to enable greater recovery and reuse of phosphate, a valuable resource. The settlement also requires Simplot to ensure that financial resources will be available when the time comes for environmentally sound closure of the facility.
Simplot’s Rock Springs facility manufactures phosphate products for agriculture and industry, including phosphoric acid and phosphate fertilizer, through processes that generate large quantities of acidic wastewater and a solid material called phosphogypsum. The phosphogypsum is deposited in a large pile known as a gypstack, and acidic wastewater is also routed to the gypstack. The gypstack at the Wyoming facility is fully lined and has a capacity to hold several billion gallons of acidic wastewater.
This settlement also resolves alleged violations of the Emergency Planning and Community Right-to-Know Act (EPCRA) for Simplot’s failure to report certain quantities of toxic chemicals in accordance with EPCRA standards.
Under the settlement, Simplot agrees to implement specific waste management measures valued at nearly $20 million. Significantly, these measures include extensive new efforts to recover and reuse the phosphate content within these wastes and avoid their disposal in the gypstack. The settlement also includes a detailed plan setting the terms for the future closure and long-term care of the gypstack. The settlement requires Simplot to immediately secure and maintain approximately $126 million in dedicated financing to ensure that funding for closure and long-term care will be available when the facility is eventually closed.
Simplot also agrees to submit revised EPCRA Form R reports (Toxic Release Inventory) for 2004 to 2013 to include estimates of certain metal compounds manufactured, processed, or otherwise used at the facility. Simplot will also pay a $775,000 civil penalty to resolve both the RCRA and EPCRA claims.
The agency previously has required through judicial and administrative settlements that 12 phosphate fertilizer facilities complete extensive injunctive relief and bring their operations into compliance with RCRA.
A consent decree formalizing the settlement was lodged today in the U.S. District Court for the District of Wyoming, and is subject to a 30-day public comment period and approval by the federal court. The consent decree can be viewed at the Department of Justice website: www.justice.gov/enrd/Consent_Decrees.html
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.
Prolific Small-Town Meth Dealer Faces Prison Time in Larger Wiretap CaseRead the Press Release
ALBANY, Ga. – A prolific small-town methamphetamine dealer involved in a larger wiretap investigation into methamphetamine trafficking in South Georgia has pleaded guilty for his crime, said Charlie Peeler, the U.S. Attorney for the Middle District of Georgia. Phil Grim, 43, of Cairo, Georgia, pleaded guilty to conspiracy to possess with intent to distribute controlled substances before U.S. District Judge Leslie Gardner on Tuesday, July 7. Grim is facing a minimum mandatory ten years in prison to a maximum life sentence, a maximum fine of $1,000,000 and five years supervised release. Sentencing has not been scheduled. There is no parole in the federal system.
Grim was first arrested in Thomas County, Georgia on March 14, 2019 in possession of drug paraphernalia. Grim told investigators that he was regularly obtaining large quantities of methamphetamine for several years from Joseph “Bae Bae” Jones, 30, of Cairo, including four days prior to the interview at 159 Alison Drive, Cairo, Georgia. Grim, who was on probation, was released and told to have no further contact with Jones. Three days later, on March 17, 2019, agents conducting a legal wiretap on phones used by Jones intercepted Grim placing an order with Jones for a large quantity of methamphetamine. Agents continued to intercept multiple calls placed by Grim to Jones seeking methamphetamine. On April 26, 2019, agents intercepted a final call by Grim to Jones to purchase methamphetamine at 159 Alison Drive. Under camera and physical surveillance, Grim was seen traveling to 159 Alison Drive and departing. Officers pulled Grim over and found him with one ounce of methamphetamine. Grim told officers he “shopped with Jones” up to 20 times in the 44 days since he was first interviewed by agents. Jones is charged with a total of twelve counts listed in the indictment, including conspiracy to possess with intent to distribute methamphetamine, distribution of methamphetamine and possession of a firearm in furtherance of a drug trafficking crime. Jones faces a maximum life imprisonment for his crimes. An indictment is only an allegation of criminal conduct, and the defendants are presumed innocent until and unless proven guilty in a court of law beyond a reasonable doubt. Jones is detained pending his trial. A court date has not been scheduled.
“Law enforcement is cracking down on suppliers and dealers of methamphetamine across the Middle District of Georgia. Those caught trafficking meth will be prosecuted and will face severe punishment for choosing to push this deadly drug in our communities,” said U.S. Attorney Charlie Peeler. “I want to thank the DEA, GBI, Grady County Sheriff's Office, Thomas County Sheriff's Office, Thomas Vice/Narcotics Squad and the Cairo Police Department for their excellent work investigating methamphetamine trafficking in our region.”
“The successful results of this investigation should let criminals, who flood our communities with methamphetamine, know that DEA and its law enforcement partners will use all its resources to destroy their drug distribution networks. This defendant will no longer be able to distribute this poison in the community of Cairo,” said Robert J. Murphy, the Special Agent in Charge of the DEA Atlanta Division.
“Illegal drugs are dangerous on the streets of Georgia. The GBI is committed to getting these drugs off of the streets by bringing to justice all those that take part in the illegal drug trade, from the supplier down to the dealer,” said GBI Director Vic Reynolds.
This case was investigated by the Drug Enforcement Agency (DEA), the Georgia Bureau of Investigations (GBI), Grady County Sheriff's Office, Thomas County Sheriff's Office, Thomas Vice/Narcotics Squad and Cairo Police Department Assistant U.S. Attorney Leah McEwen is prosecuting the case for the Government. Questions can be directed to Pamela Lightsey, Public Information Officer, United States Attorney’s Office, at (478) 621-2603 or Melissa Hodges, Public Affairs Director (Contractor), United States Attorney’s Office, at (478) 765-2362.
Project Guardian Update: Two Felons Appear in Federal Court on Gun ChargesRead the Press Release
CHARLESTON, W.Va. – Two Charleston men appeared in federal court this week on gun charges, according to United States Attorney Mike Stuart.
Kali Eusi Young, 42, was sentenced to eight years in prison, followed by three years of supervised release, for being a felon in possession of a firearm. Young previously admitted that that on December 16, 2019, he was riding as the backseat passenger in a vehicle that was stopped by law enforcement officers in South Charleston. Officers discovered during the course of the traffic stop that Young was in possession of a loaded 9mm semi-automatic pistol along with a stash of controlled substances. Young admitted that he was in possession of the firearm and that he knew he was prohibited from possessing firearms due to a previous felon in possession of a firearm conviction in the Southern District of Ohio. The Metropolitan Drug Enforcement Network Team (MDENT) conducted the investigation. Senior United States District Judge John T. Copenhaver, Jr. imposed the sentence. Assistant United States Attorney Negar M. Kordestani handled the prosecution.
Jymere Alan Pratt, 22, pled guilty to being a felon in possession of a firearm. Pratt admitted that he possessed a Smith and Wesson M&P Shield 9mm pistol in the early morning hours of May 24, 2019, near the intersection of Tennessee Avenue and Randolph Street on Charleston’s West Side. Law enforcement responded to the location after learning that a vehicle was parked across the sidewalk and into the bushes of a nearby business with all of the occupants unconscious. Once officers arrived, they were able to observe Pratt, the driver, wearing a bag with a shoulder strap which he placed in the back seat prior to exiting the vehicle. Officers later searched the vehicle, finding a pistol and several rounds of ammunition inside the bag. Pratt was prohibited by law from possessing firearms due to a previous conviction for robbery in the second degree in Monongalia County Circuit Court on August 14, 2017. Pratt was still on probation from that conviction when this incident occurred. Pratt faces up to 10 years in prison when sentenced on November 10, 2020. The Charleston Police Department conducted the investigation with the assistance of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF). United States District Judge Irene Berger presided over the hearing. Assistant United States Attorney Jeremy B. Wolfe is handling the prosecution.
These cases are part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. The United States Attorney’s Office has prosecuted these cases with support from the Project Guardian partners noted above. For more information about Project Guardian, please see: https://www.justice.gov/projectguardian.
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President’s Commission on Law Enforcement and the Administration of Justice Holds Hearing on Trust and Respect for Law Enforcement via TeleconferenceRead the Press Release
Yesterday, the President’s Commission on Law Enforcement and the Administration of Justice held a hearing on community trust and respect for law enforcement. The hearing was conducted via teleconference and featured expert witnesses who provided testimony and answered questions from the commissioners.
On Wednesday, July 8, 2020, the commission received testimony from Brian Marvel, President of the Peace Officers Research Association of California (PORAC); Dr. Paul Lilly, Judge, Brown County, Texas; Mick McHale, President of the National Association of Police Organizations (NAPO); and Lieutenant Christopher Cook, Arlington (Texas) Police Department.
The hearing focused on community trust and respect for law enforcement. The panelists discussed the importance of building relationships between law enforcement and communities; consideration for tactical gear choices; adding the presence of social workers or mental health professionals to certain types of emergency calls; the importance of public messaging, especially after a critical incident; and consideration for rewarding positive policing rather than relying on, for instance, the quota system, such as traffic stops, to measure success.
For more information on the commission, please visit: https://www.justice.gov/ag/presidential-commission-law-enforcement-and-administration-justice.
Audio recordings and transcripts of the hearings will be posted online once available.
Pomona Park Man Indicted for Sex Trafficking Children and Online Enticement to Engage in Unlawful Sex Acts with ChildrenRead the Press Release
Jacksonville, Florida – United States Attorney Maria Chapa Lopez announces the return by a grand jury of an indictment charging Edward Alan Hardin (33, Pomona Park) with two counts of sex trafficking children and four counts of using a cellular phone to entice children to engage in unlawful sex acts. Hardin faces a mandatory minimum penalty of 10 years, and up to life, in federal prison, for each count, followed by a term of 5 years, and up to a lifetime, of supervised release. The indictment also notifies Hardin that the United States intends to forfeit assets used in the offense.
According to the indictment, beginning by at least some date in 2016, Hardin began soliciting a child victim to engage in commercial sex acts, knowing that the victim was less than 18 years old. In 2020, Hardin allegedly used a cellular telephone to entice the victim to engage in unlawful sexual activity, including unlawful sexual activity with a minor and custodial sexual battery, in violation of Florida statutes, and attempted production of child pornography in violation of federal law.
The indictment further alleges that, at least from July 21, 2018, and through a date in March 2020, Hardin used a cellular telephone to entice a second child victim to engage in unlawful sexual activity, including unlawful sexual activity with a minor, in violation of Florida statutes; statutory rape, in violation of Georgia Code; and production of child pornography, in violation of federal law.
It is further alleged that on a date in late 2017, or early 2018, Hardin engaged in sex trafficking of a third child, and caused that victim to engage in a commercial sex act.
An indictment is merely a formal charge that a defendant has violated one or more of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by Homeland Security Investigations, the Clay County Sheriff’s Office, and the Putnam County Sheriff’s Office. It will be prosecuted by Assistant United States Attorney Laura Cofer Taylor.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Pittsburgh Man, 21, Sentenced to 5 Years in Federal Prison for Running Drugs for DS44 Neighborhood GangRead the Press Release
PITTSBURGH, PA - A former resident of Pittsburgh has been sentenced in federal court to five years’ imprisonment followed by four years of supervised release on his conviction of conspiracy to distribute or possess with intent to distribute 40 grams or more of heroin and fentanyl, United States Attorney Scott W. Brady announced today.
United States District Judge William S. Stickman IV imposed the sentence on Keevan Jackson, 21.
According to information presented to the court, in 2017, the Greater Pittsburgh Safe Streets Task Force initiated an investigation primarily targeting the Darccide/Smash 44, or DS44, neighborhood gang, and its drug-trafficking activity, in and around the South Side area of Pittsburgh. As part of this large-scale narcotics and firearms investigation, in February of 2019, the United States received authorization to conduct a federal wire investigation, which continued through June of 2019. Intercepted communications as well as physical and electronic surveillance revealed that Mr. Jackson was involved in the distribution of heroin and fentanyl, including serving as a runner for co-conspirator Christopher Highsmith. Mr. Jackson accepted responsibility for distributing or possessing with intent to distribute 45 grams of fentanyl and heroin.
Assistant United States Attorney Christy C. Wiegand prosecuted this case on behalf of the government.
The Federal Bureau of Investigation led the multi-agency investigation of this case, which also included the Bureau of Alcohol Tobacco Firearms and Explosives, Allegheny County Adult Probation, Allegheny County Police Department, Allegheny County Sheriff’s Office, Pennsylvania Attorney General’s Office Bureau of Narcotics, Pittsburgh Bureau of Police, and the Wilkinsburg Police Department. Other assisting agencies include the Green Tree Police Department, New York City Police Department, Mount Oliver Police Department, Pennsylvania State Police, Yonkers Police Department, United States Marshals Fugitive Task Force, and the United States Postal Inspection Service.
This case is part of the Organized Crime Drug Enforcement Task Force program, known as OCDETF. OCDETF was established in 1982 to support comprehensive investigations and prosecutions of major drug trafficking and money laundering organizations. It is the keystone of the drug reduction strategy of the Department of Justice. By combining the resources and expertise of federal agencies and their state and local law enforcement partners, OCDETF identifies, disrupts, and dismantles the most serious drug trafficking, money laundering, and transnational criminal organizations.
Philadelphia man admits to heroin and fentanyl distributionRead the Press Release
MARTINSBURG, WEST VIRGINIA – Richard Gaines, of Philadelphia, Pennsylvania, has admitted to opioid distribution, U.S. Attorney Bill Powell announced.
Gaines, age 45, pled guilty today to one count of “Possession with Intent to Distribute Heroin and Fentanyl.” Gaines admitted to having heroin and fentanyl in June 2017 in Berkeley County.
Gaines faces up to 20 years of incarceration and a fine of up to $1,000,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
These charges are the result of investigations supported by the Organized Crime Drug Enforcement Task Force (OCDETF) under the Attorney General-led Synthetic Opioid Surge (SOS)/Special Operations Division (SOD) Project Clean Sweep. This initiative seeks to reduce the supply of synthetic opioids in “hot spot” areas previously identified by the Attorney General of the United States, thereby reducing drug overdoses and drug overdose deaths, and identify wholesale distribution networks and sources of supply operating nationally and internationally.
Assistant U.S. Attorney Lara Omps-Botteicher is prosecuting the case on behalf of the government. The Eastern Panhandle Drug & Violent Crimes Task Force, a HIDTA-funded initiative, the West Virginia State Police, and the Martinsburg Police Department investigated.
U.S. Magistrate Judge Robert W. Trumble presided.
Pendleton County mail carrier admits to attempted election fraudRead the Press Release
ELKINS, WEST VIRGINIA – Thomas Cooper, a mail carrier in Pendleton County, has admitted to attempted election fraud, U.S. Attorney Bill Powell announced.
Cooper, age 47, of Dry Fork, West Virginia, pled guilty to one count of “Attempt to Defraud the Residents of West Virginia of a Fair Election” and one count of “Injury to the Mail.” Cooper held a U.S. Postal Service contract to deliver mail in Pendleton County. In April 2020, the Clerk of Pendleton County received “2020 Primary Election COVID-19 Mail-In Absentee Request" forms from eight voters on which the voter's party-ballot request appeared to have been altered.
The clerk reported the finding to the West Virginia Secretary of State’s office, which began an investigation. The investigation found five ballot requests that had been altered from “Democrat” to “Republican.” On three other requests, the party wasn’t changed, but the request had been altered.
Cooper was responsible for the mail delivery of the three towns from which the tampered requests were mailed: Onego, Riverton, and Franklin, West Virginia. Cooper admitted today to altering some of the requests.
Assistant U.S. Attorney Stephen D. Warner is prosecuting the case on behalf of the government. The West Virginia Secretary of State’s Office, the West Virginia Attorney General’s Office, and the U.S. Postal Service Office of Inspector General investigated.
U.S. Magistrate Judge Michael John Aloi presided.
Owner of Auto Warranty Sales Company Indicted for Failure to Pay Personal and Corporate Income TaxesRead the Press Release
St. Louis, MO –Gary D. Primm, Jr., 39, of Wentzville, Missouri, was indicted by a federal grand jury on one count of willful failure to file return or pay tax and two counts of tax evasion.
According to the Indictment, Primm owned and operated United Auto Defense, LLC located in St. Charles, Missouri which operated as a call center marketing auto warranties. Primm received over a million dollars in income from United for tax years 2014 and 2015, and did not pay any personal income taxes. Primm took steps to evade assessment of his taxes by diverting United funds to a nominee bank account instead of his personal bank account and filing false forms with the IRS. Primm used funds from the nominee bank account to pay personal expenses, including his mortgage payments, jewelry purchases, automobile purchases, and gambling expenses. Primm also failed to file corporate income tax on behalf of United in 2014.
If convicted, Primm faces a maximum penalty of 5 years in prison and a $100,000 fine. Restitution is also mandatory. In determining the actual sentence, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
The Internal Revenue Service Criminal Investigation is investigating this case. Assistant U.S. Attorney Lindsay McClure-Hartman is handling the case for the U.S. Attorney’s Office.
North Suburban Man Charged in Federal Court with Illegal Sports Bookmaking and Tax OffensesRead the Press Release
CHICAGO — The U.S. Attorney’s Office in Chicago today charged a north suburban man with illegal sports bookmaking and filing a false federal income tax return.
From 2014 to 2018, DOMINIC POETA, 63, of Highland Park, unlawfully operated a business that provided sports betting and wagering services, both domestically and abroad, according to a criminal information filed in U.S. District Court in Chicago. The information also charges Poeta with filing a false federal income tax return for the calendar year 2016 that falsely reported his total income was $81,609, knowing his actual income substantially exceeded that amount.
Poeta will be arraigned in federal court in Chicago on a future date to be set by the Court.
The information was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Kathy A. Enstrom, Special Agent-in-Charge of the Internal Revenue Service Criminal Investigation Division in Chicago; and John Crawford, Special Agent-in-Charge of the Chicago Regional Office of the Federal Deposit Insurance Corporation, Office of Inspector General. The government is represented by Assistant U.S. Attorney Patrick King.
The public is reminded that an information is not evidence of guilt. The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
The tax charge is punishable by up to three years in federal prison, while the bookmaking charge is punishable by up to two years. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.
New Haven Woman Pleads Guilty to Role in Heroin, Cocaine and Crack ConspiracyRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that JENNA DEFELICE, 35, of New Haven, pleaded guilty today before U.S. District Judge Alvin W. Thompson to conspiring to distribute heroin, cocaine and crack cocaine.
Pursuant to the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), the court proceeding occurred via videoconference.
According to court documents and statements made in court, an investigation conducted by the DEA’s New Haven Tactical Diversion Squad revealed that Defelice’s associate, Musa Hill, was obtaining cocaine from a source in the Bronx, New York, and heroin from a source in New Haven. He converted some of the cocaine he received into crack cocaine, and then sold the narcotics to customers. He also provided narcotics to Defelice who distributed them to customers on his behalf.
During the investigation, law enforcement made controlled purchases of crack, heroin and hundreds of counterfeit oxycodone pills from Hill. The vast majority of the counterfeit pills contained fentanyl.
Defelice was arrested on June 25, 2019, and is currently released on a $100,000 bond.
Defelice pleaded guilty to one count of conspiracy to possess with intent to distribute, and to distribute, controlled substances, an offense that carries a maximum term of imprisonment of 20 years. Judge Thompson scheduled sentencing for October 1, 2020.
On November 20, 2019, Hill pleaded guilty to the same offense. On March 5, 2020, Judge Thompson sentenced him to 72 months of imprisonment.
This case has been investigated by the DEA Tactical Diversion Squad, which includes officers from the Bristol, Hamden, Meriden, Monroe, New Britain, New Haven, Wallingford, Watertown and West Haven Police Departments. The case is being prosecuted by Assistant U.S. Attorneys Jennifer R. Laraia and H. Gordon Hall.
Mountain Village Man Pleads Guilty to Possession of Child PornographyRead the Press Release
DENVER – United States Attorney Jason R. Dunn announced that Jason Van Hoesen, age 46, of Mountain Village, Colorado, near Telluride, Colorado, pleaded guilty earlier this week to the possession of child pornography. Investigators recovered more than 10,500 files, including 281 videos depicting child pornography.
According to the stipulated facts contained in the plea agreement, the investigation into Van Hoesen was initiated by Colorado’s Internet Crimes Against Children (ICAC) Task Force. On December 14, 2018, a specific web search engine reported to the National Center for Missing and Exploited Children (NCMEC) that on November 15, 2018, an individual using a specific IP address uploaded a file of suspected child pornography.
NCMEC analysts reviewed and attempted to determine the jurisdiction for the incident reported. Once the analysis was complete, a cybertip was securely transmitted to Colorado’s ICAC Task Force. The Colorado Springs Police Department (CSPD) is the lead agency for this task force.
Cybertips are received and then securely transmitted to the agency affiliated with the image for further investigation. Upon receipt of this cybertip, CSPD reviewed the uploaded image, which depicted a nude prepubescent minor boy approximately 6 to 10 years old. A check through the American Registry for Internet Numbers reflected the IP address in question was registered to Mountain Village Metro Cable under the parent company of Centurylink.
An administrative summons was served on Mountain Village Metro Cable for subscriber information. Mountain Village Metro Cable provided an address on Mountain Village Boulevard. The Mountain Village Police Department (MVPD) was notified of this information. They in turn requested assistance with the investigation. As such, a joint CSPD and MVPD ICAC investigation was initiated.
On February 8, 2019, MVPD executed a state search warrant at the Mountain View residence where Van Hoesen and his roommate were contacted. Law enforcement conducted a search of the roommate’s cell phone and computer, which revealed no child pornography.
Van Hoesen confirmed to law enforcement his name and email address. He also confirmed that he used the identified web search engine to upload a photo of a naked boy in November 2018.
Numerous digital storage devices were located and seized within the Mountain Village premises. They were later transported to the Colorado Springs Police Department for further review. A computer forensic review of the devices revealed that Van Hoesen had downloaded child pornography on several occasions and possessed more than 10,500 files depicting child pornography. Van Hoesen had extensively organized his collection into folders, including folders containing images of infants and toddlers.
Copies of all of the files depicting child pornography were provided to NCMEC, which reported that more than 4,400 files possessed by the defendant depict minor victims previously identified by law enforcement. According to the plea agreement, Van Hoesen has agreed to pay restitution to 20 minor victims who requested restitution.
This case was investigated by the Colorado Internet Crimes Against Children (ICAC) Task Force, in conjunction with the Mountain Village Police Department. The case was prosecuted by Assistant United States Attorneys Alecia L. Riewerts and Jeffrey K. Graves.
Jason Van Hoesen was charged by Indictment on May 3, 2019, and pleaded guilty to the charge on July 6, 2020. The change of plea was conducted before U.S. Magistrate Judge James M. Candelaria and is pending acceptance by U.S. District Court Judge Robert E. Blackburn. Van Hoesen’s sentencing hearing is tentatively set for October 5, 2020.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the District of Colorado. Related court documents can be found on PACER by searching for Case Number 19-cr-0208.
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.
Mother and daughter from Evansville charged with COVID-19 related wire fraudRead the Press Release
EVANSVILLE – United States Attorney Josh J. Minkler announced today, Rose Ann Azzarello, 60, Ft. Branch, Ind., and Andrea Renee Pytlinski, 38, Ft. Branch, Ind., were arrested and charged with wire fraud.
"With any crisis, comes criminals looking for the opportunity to cash in for their own benefit. The coronavirus health crisis has not been immune from their fraudulent schemes" said Minkler. "These fraudsters steal money that does not belong to them for their greedy purposes, which strains the programs that are meant to help those most in need."
On March 27, 2020, the President signed into law the Coronavirus Aid, Relief, and Economic Security (CARES) Act. This legislation provides emergency assistance and health care response for individuals, families, and businesses affected by the COVID-19 pandemic
The CARES Act was designed to mitigate the economic effects of the COVID-19 pandemic in a variety of ways. The CARES Act includes a provision of temporary benefits for individuals who have exhausted their entitlement to regular unemployment compensation, as
well as coverage for individuals who are not eligible for regular unemployment compensation, are self-employed, or have limited recent work history.
On 5/15/2020, the Fort Branch Police Department received a complaint from Field and Main Bank in Evansville, regarding account transactions in which Washington State Unemployment benefits were being ACH transferred into Indiana bank accounts held by Azzarello and Pytlinski.
Those accounts were funded with Washington State unemployment benefits and the proceeds of an alleged check scam. For more than a year, Azzaarello and Pytlinski participated in a wire fraud scheme by receiving and sending funds via wire and common courier as directed by someone only known as "William Lewis". As the illicit funds are deposited into their accounts, Azzarello and Pytlinski would withdraw the funds prior to the detection of any fraud and then transmit a portion of the ill-gotten funds to a third party while retaining their share.
The United States Secret Service has received reports about a well-organized fraud ring exploiting the COVID-19 crisis to commit large-scale fraud against state unemployment insurance programs. The primary state targeted so far is Washington.
This fraud network is believed to consist of hundreds, if not thousands, of money mules with potential losses in the millions of dollars. The financial institutions targeted have been at all levels including local banks, credit unions and large national banks.
This case was the result of an investigation by the United States Secret Service, Federal Bureau of Investigation, and the Ft. Branch Police Department.
"Today’s announcement illustrates the Secret Service’s commitment to combating COVID-19 unemployment fraud," said Eric Reed, Special Agent in Charge, Secret Service Indianapolis Field Office. "The immediate investigative actions taken by the Secret Service and our local, state and federal law enforcement partners as well as the U.S. Attorney’s Office, prevented legitimate unemployment funds from getting into the wrong hands. The Secret Service will continue to work closely with our law enforcement partners and the U.S. Attorney’s Office to investigate and arrest criminals who attempt to defraud the critical COVID-19 relief programs and the American taxpayer."
"Criminals profiting off this crisis and targeting programs meant to help Americans when they are at their most vulnerable is unacceptable," said Special Agent in Charge Paul Keenan, FBI Indianapolis. "Those who would perpetrate such illegal activity during these unprecedented times should know that the FBI and our law enforcement partners haven’t been sitting idly by. We have continued to aggressively identify and pursue those who fraudulently profit from the pandemic to quickly reduce the threat from these scams."
According to Assistant United States Attorney Todd Shellenbarger who is prosecuting this case for the government, each defendant faces up to 20 years’ imprisonment, 3 years of supervised release, and a maximum fine of $250,000.
A charge is not evidence of guilt. All parties are presumed innocent until proven otherwise in federal court.
This prosecution is an example of the Department of Justice’s strong commitment to combating fraud and criminal activity related to COVID-19, which is reflected in the creation of a Coronavirus Fraud Task Force in the Southern District of Indiana. If you receive any forms of suspicious communication related to the COVID-19 crisis, or become aware of family and friends that have received suspicious communications, I ask that you don’t respond directly but instead report the activity to the National Center for Disaster Fraud (NCDF) Hotline at 1-866-720-5721, or to the NCDF e-mail address [email protected]."
Mexican National Sentenced to 10 years in Prison for Poly-Drug Distribution ConspiracyRead the Press Release
FRESNO, Calif. — Francisco Alcantar-Miranda, aka Paquin, 31, of Mexico, was sentenced today to 10 years in prison for conspiring to manufacture, to distribute and to possess with intent to distribute methamphetamine, cocaine, heroin, and marijuana, U.S. Attorney McGregor W. Scott announced. U.S. District Judge Dale A. Drozd, who sentenced Alcantar, also ordered the forfeiture of a handgun and approximately $18,000 in cash.
On Feb. 2, Alcantar pleaded guilty and acknowledged that he assisted in manufacturing methamphetamine and storing large quantities of other drugs at an unoccupied residence in Madera. At the end of January 2019, detectives of the Madera County Sheriff’s Office Narcotic Enforcement Team (MADNET) executed a search warrant at the residence and found Alcantar, along with two other men, Oscar Rene Marrot-Garcia, 27, of Chowchilla, and Jose Monge-Ponce, 31, of Mexico. The detectives also found over 10 pounds of methamphetamine, 1 pound of heroin, 1 pound of cocaine, and 25 pounds of marijuana.
Marrot-Garcia pleaded guilty on June 12, and is scheduled for sentencing on Sept. 4. He faces a mandatory minimum statutory penalty of 10 years in prison and a maximum statutory penalty of life in prison, along with a $10 million fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Charges are pending against Monge-Ponce, and he is scheduled for a jury trial on Oct. 26. The charges are only allegations; Monge-Ponce is presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case is the product of an investigation by MADNET detectives and agents of the High Intensity Drug Trafficking Area (HIDTA) High Impact Investigation Team (HIIT), consisting of agents of Homeland Security Investigations; California Department of Justice; California Highway Patrol; Fresno, Tulare, and King Counties Sheriffs’ Offices; and Fresno Police Department. Assistant U.S. Attorney Karen A. Escobar is prosecuting the case.
Massachusetts Man Guilty of Receiving Child PornographyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051ROCHESTER, N.Y.- U.S. Attorney James P. Kennedy, Jr. announced today that Frank Salerno, 30, of Pittsfield, Massachusetts, pleaded guilty, before U.S. Chief Judge Frank P. Geraci, Jr., to receiving child pornography The charge carries a minimum penalty of 5 years imprisonment, a maximum penalty of 20 years imprisonment, and a $250,000 fine.
Assistant U.S. Attorney Kyle Rossi, who is handling the case, stated that in 2019, Salerno engaged in sexually explicit online conversations with a 14 year-old minor who lived in Western New York. In the conversations, Salerno induced the minor to produce and send Salerno child pornography. Salerno was ultimately reported to police, and he was arrested in Massachusetts in December 2019.
The plea is the result of an investigation by the Federal Bureau of Investigation, Child Exploitation Task Force, under the direction of Special Agent-in-Charge Stephen Belongia.
Sentencing is scheduled for October 7, 2020, before Judge Geraci.# # # #
Mapleton Man Sentenced for Possession of FentanylRead the Press Release
Portland, Maine: A Mapleton man was sentenced today in federal court in Portland for possession of fentanyl with intent to distribute, U.S. Attorney Halsey B. Frank announced.
Chief U.S. District Judge Jon D. Levy sentenced Christopher Myshrall, 35, to two years in prison and three years of supervised release. Myshrall pleaded guilty on November 19, 2019.
According to court records, on November 1, 2018, Myshrall was a passenger in a vehicle pulled over by the Maine State Police for a traffic violation. A narcotics detection dog alerted to the presence of illegal drugs in the vehicle. Troopers located over 700 glassine envelopes of fentanyl in hidden compartments in the vehicle’s engine area. Further investigation revealed that Myshrall and the vehicle’s operator had obtained the fentanyl in Massachusetts for distribution in Maine.
The Maine State Police and the U.S. Drug Enforcement Administration investigated the case. The U.S. Attorney’s Office prosecuted the case as part of the Department of Justice’s Operation Synthetic Opioid Surge, a program designed to reduce the supply of deadly synthetic opioids.
Madison Man Sentenced to 20 Years for Producing Child PornographyRead the Press Release
MADISON, WIS. - Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Jeremy Schenck, 25, Madison, Wisconsin, was sentenced today by Chief U.S. District Judge James D. Peterson to 20 years in federal prison, to be followed by 25 years of supervised release, for producing child pornography. Schenck pleaded guilty to this charge on February 5, 2020.
The investigation began in December 2018, when a social worker with Dane County Human Services contacted the Madison Police Department after learning of an allegation of sexual abuse against Schenck. The law enforcement investigation led to the issuance of a search warrant for Schenck’s apartment in February 2019. A search of computers seized from Schenck’s apartment revealed images of child pornography. Schenck was initially charged with possession of child pornography in Dane County on February 21, 2019. After further investigation revealed that Schenck had taken sexually explicit pictures of a toddler, he was indicted on charges of production of child pornography in federal court.
At sentencing, Judge Peterson stated that the sentence was appropriate due to the vulnerability of the minor victim, because Schenck distributed the image of the minor victim, and because Schenck committed a hands-on offense against the child. Judge Peterson found that Schenck had demonstrated that he was a threat to all vulnerable victims and the community at large, and stated that he imposed this sentence because he was very keenly concerned with protecting the community from Schenck.
The charge against Schenck was the result of an investigation conducted by the Madison Police Department and the Wisconsin Department of Justice Division of Criminal Investigation. The prosecution of the case has been handled by Assistant U.S. Attorney Julie Pfluger.
Luzerne County Woman Guilty of Conspiracy to Unlawfully Purchase GunsRead the Press Release
SCRANTON- The United States Attorney’s Office for the Middle District of Pennsylvania announced that Laquanna Bacote, age 25, of Wilkes-Barre, Pennsylvania, pleaded guilty on July 7, 2020, before U.S. District Court Judge Malachy E. Mannion to conspiring with others to make false statements in connection with the acquisition of firearms from federal-licensed firearm dealers in Luzerne and Northampton Counties between April and October of 2019.
According to United States Attorney David J. Freed, Bacote admitted to conspiring with others to purchase 14 guns for another person while falsely claiming to be the actual purchaser of the firearms. Bacote made false statements on federal firearms forms to purchase firearms and unlawfully obtain firearms from H & H Tactical in Exeter, Pennsylvania and NJT Arms in Northampton, Pennsylvania.
Judge Mannion ordered a pre-sentence investigation. Sentencing will be scheduled at a later date.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). Assistant U.S. Attorney Francis P. Sempa is prosecuting the case.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
The maximum penalty under federal law is five years’ imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Leader of a Major Drug Trafficking Organization Pleads Guilty to Conspiring to Distribute Drugs Throughout the St. Louis AreaRead the Press Release
St. Louis, MO – The leader of a large-scale St. Louis based distribution organization has pleaded guilty to conspiring to distribute over five kilograms of cocaine, over one kilogram of heroin, and over 400 grams of fentanyl from March 11, 2018 to March 12, 2019.
Guy R. Goolsby, aka “Ricochet,” “Shay,” Shorty,” 44, of St. Louis, was indicted with 14 others in St. Louis, Missouri, in May 2019 for conspiring to distribute more than 25 kilograms of cocaine, 10 kilograms of heroin, and three kilograms of fentanyl. Throughout the investigation, law enforcement seized over $2,036,981 of drug payments and profits, luxury jewelry, and vehicles.
Goolsby’s co-defendants are as follows and awaiting trial:
Grant A. Berry, aka “Kojak,” “Jak,” “50,”
David M. Foston, aka “Max,” “Prez,”
Kennersen L. Gooden, aka Kenneth Dodd,
David M. Martinez, currently a fugitive,
Chivas Holmes, aka “Q Ball,” “Q,”
Jonathan W. Jefferson,
Harold Arceneaux,
Otis B. Dodd, aka O.B. Dodd, “O.B.,”
David Lee Trevino,
Carlos Macias,
Lina Katiuzca Macias, aka Lina Katiuzca Mendez,
Jorge A. Lopez-Duran, and
Shannon L. Holmes
According to the plea agreement, investigators from of the Drug Enforcement Administration St. Louis Division uncovered a cocaine, heroin, and fentanyl distribution organization that was transporting kilogram quantities of cocaine, heroin and fentanyl from Mexico, through Texas and Florida, to the St. Louis Metropolitan area. According to court documents, the higher-echelon of the conspiracy, including Goolsby, served federal prison sentences for prior controlled substance violations in the Federal Correction Institution in Florence, Colorado beginning in the late 2000s.
Throughout 2018, Goolsby and his co-conspirators utilized drug couriers and vehicles with concealed compartments to ship multi-kilogram amounts of cocaine, heroin and fentanyl to a residence in Spanish Lake, Missouri from Houston, Texas and Fort Lauderdale, Florida. Goolsby and his co-conspirators unloaded the drugs at that residence and distributed them throughout the St. Louis Metropolitan area. The proceeds from the sale of those controlled substances were stored at residences in St. Louis City and County and loaded into the concealed compartments of vehicles for transportation back to Texas and Florida.
On March 17, 2018, DEA special agents and task force officers located and seized $1,304,804.00 in drug payments from Goolsby and the other St. Louis-based distributors in Phelps County, Missouri as a courier was traveling back to Goolsby’s drug suppliers in Texas. On April 20, 2018, the DEA intercepted a courier in possession of 25 kilograms of cocaine destined for Goolsby and the other St. Louis drug distributors. In July 2018, investigators seized three kilograms of fentanyl and $263,000 in drug payments from a courier’s vehicle in Oklahoma. On September 8, 2018, investigators searched the Spanish Lake residence and seized 10 kilograms of heroin.
In October 2018, Goolsby and the other St. Louis based distributors attempted to purchase $385,000 worth of cocaine during a sting operation in a suburb of Houston. DEA investigators intercepted the courier and seized the United States currency belonging to Goolsby and the other St. Louis based distributors. The currency was to be a partial payment for 25 kilograms of cocaine, which the organization intended to distribute.
“Poly-drug organizations like this one, who deal in the triple threat of cocaine, heroin and fentanyl, are particularly dangerous to the safety of our communities,” said DEA Special Agent in Charge William J. Callahan, who oversees the federal agency in Missouri, Kansas, and Southern Illinois. “It’s particularly satisfying when DEA dismantles a trafficking organization with tentacles across the nation and dealing in large quantities of illegal drugs. Investigations of this size can impact many lives and maybe even prevent someone from overdosing.”
Goolsby’s sentencing date is presently set for October 14, 2020. His charges carry a sentence of 10 years to life in prison.
The remaining co-defendants are presumed to be innocent unless and until proven guilty.
This nationwide investigation was conducted with the assistance of the DEA offices in Houston, TX, Fort Lauderdale, FL, Detroit, MI, the United States Marshal’s Service, and local law enforcement partners including the St. Charles County, Missouri Police Department, the St. Louis Metropolitan Police Department, the Bridgeton, Missouri Department Police, the Phelps County, Missouri Sherriff’s Department, and the Cleveland, Texas Police Department.
Lake Mary Woman Pleads Guilty to Stealing over $470,000Read the Press Release
Orlando, Florida – Kathryn Smith (58, Lake Mary) has pleaded guilty to wire fraud in a scheme to steal over $470,000 from her employer. Smith faces up to 20 years in federal prison, and will be ordered to pay restitution. Sentencing is scheduled for September 29, 2020.
According to court documents, Smith worked at a title insurance company located in Orlando, Florida. From December 2012, to May 2019, Smith embezzled $472,765.95 from the title insurer by using her access to the company’s bank accounts to transfer funds into accounts for which she had control, and by writing checks to herself without any authorization. In addition, Smith used funds from the title insurer to pay some of her personal credit cards charges, insurance for her adult child, and other miscellaneous amounts to which she was not entitled.
This case was investigated by the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorneys Amanda Daniels and Roger B. Handberg.
L.A. Man Arrested on Charges of Fraudulently Obtaining Luxury Vehicles from Victims Who Wanted Out of Their LeasesRead the Press Release
LOS ANGELES – A Baldwin Hills man is scheduled to be arraigned this afternoon on federal charges that allege he conned victims from across the nation into giving him their high-end and exotic vehicles with bogus promises he would find other people to take over their leases.
Geoffrey Eldridge Hull, 40, who maintained offices on Sunset Boulevard in Hollywood, was arrested Wednesday evening by special agents with Homeland Security Investigations. Hull was arrested pursuant to a federal grand jury indictment that charges him with six counts of wire fraud related to his “lease consignment” program.
Hull allegedly marketed himself and the various companies he operated as being able to find people to take over luxury automobile leases from individuals who wanted out of the leases on their Bentleys, Ferraris, Porsches, Maseratis and other high-end automobiles. Hull agreed to cover monthly lease payments and promised leaseholders that he would quickly find a “credit-qualified buyer to legally assume the lease through the original finance company,” according to the indictment, which further alleges that Hull used a longtime friend and business associate to vouch for the quality of the program.
Despite assuring victims that his venture was successful, Hull and his companies did not find people to take over these leases, the indictment alleges. Instead, Hull offered the luxury cars for rent and passed little of the rent money onto the original leaseholders, who were still responsible for lease payments. Furthermore, Hull allegedly made few, if any, timely car lease payments.
Hull routinely ignored victims’ requests for the return of their vehicles, prompting some to make stolen car reports to law enforcement agencies, according to court documents. When some victims’ cars were returned after law enforcement seizures, repossession and other means, the cars were often damaged, had incurred toll and parking violations, and had been driven over the allotted mileage.
“Customers and local and federal law enforcement repeatedly told Hull his business was fraudulent, Hull was sued civilly several times for fraud and intentional misrepresentation, he received dozens of demand letters from attorneys, and he was interviewed by the media about his failure to make lease payments as promised,” according to a criminal complaint previously filed in this case.
When victims posted negative reviews online about Hull and his company, Hull would change his company name and resume the scheme, court documents allege. The company names Hull used to operate his scheme included Exotic Lease Transfer, Luxe Lease Transfer, Shift Lease, Veer Lease, Torque Transfer, Haven Transfer, Early Lease, and Open Lease Transfer. Hull, who has three prior convictions for grand theft auto, also allegedly used a series of aliases as part of the scheme, including “Geoff Eldredge,” “Geoff Eldridge,” “Jefrii Eldridge,” “Geoffrey Hulle,” “Jeff Bluthenthal,” and “Jeff H.”
Investigators have, so far, identified approximately 115 victims from around the nation. The estimated losses in this case exceed $1 million. Investigators believe there are still unidentified victims, and anyone with information about this matter is encouraged to call the Homeland Security Investigations Tip Line at 866-DHS-2-ICE (866-347-2423).
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
If convicted of the six counts of wire fraud alleged in the indictment, Hull would face a statutory maximum sentence of 120 years in federal prison.
This case is being prosecuted by Assistant United States Attorneys Carolyn Small of the Major Frauds Section and Agustin D. Orozco of the Public Corruption and Civil Rights Section.
Joint Statement from the United States Attorneys for the Northern, Eastern and Western Districts of Oklahoma on McGirt v Oklahoma Supreme Court RulingRead the Press Release
“As Oklahoma’s United States Attorneys, we are confident tribal, state, local, and federal law enforcement will work together to continue providing exceptional public safety under this new ruling by the United States Supreme Court.”
U.S. Attorney Timothy Downing, Western District of Oklahoma
U.S. Attorney Brian Kuester, Eastern District of Oklahoma
U.S. Attorney Trent Shores, Northern District of Oklahoma
Joint Statement from the United States Attorneys for the Northern, Eastern and Western Districts of Oklahoma on McGirt v Oklahoma Supreme Court RulingRead the Press Release
"As Oklahoma’s United States Attorneys, we are confident tribal, state, local, and federal law enforcement will work together to continue providing exceptional public safety under this new ruling by the United States Supreme Court."
Timothy J. Downing, United States Attorney for the Western District of Oklahoma
Brian J. Kuester, United States Attorney for the Eastern District of Oklahoma
R. Trent Shores, United States Attorney for the Northern District of Oklahoma
Joint Statement from the United States Attorneys for the Northern, Eastern and Western Districts of Oklahoma on McGirt v. Oklahoma Supreme Court RulingRead the Press Release
“As Oklahoma’s United States Attorneys, we are confident tribal, state, local, and federal law enforcement will work together to continue providing exceptional public safety under this new ruling by the United States Supreme Court.”
U.S. Attorney Timothy Downing, Western District of Oklahoma
U.S. Attorney Brian Kuester, Eastern District of Oklahoma
U.S. Attorney Trent Shores, Northern District of OklahomaIndian Businessman Sentenced for Drug Importation, Smuggling, and International Money Laundering OffensesRead the Press Release
PITTSBURGH, PA - A citizen of India was sentenced in federal court for one count of conspiracy to import Schedule II and Schedule IV controlled substances, one count of conspiracy to smuggle misbranded drugs, and one count of international money laundering conspiracy, United States Attorney Scott W. Brady announced today.
On July 7, 2020, Chief United States District Judge Mark R. Hornak sentenced Jeetendra Harish Belani, a/k/a Jeetu, 37, of Nagpur, India, to time served followed by three years of supervised release. Belani has been detained for approximately 13 months following his arrest in the Czech Republic on June 3, 2019. Belani, who will be removed to India following his release from federal custody, was also ordered to forfeit $100,000.
During his plea hearing on December 9, 2019, Belani admitted that he operated a drug-distribution entity based in India called LeeHPL Ventures, as well as an associated website—www.leehpl.com. Between 2015 and 2019, Belani admitted that he and his co-conspirators, through LeeHPL Ventures, imported into the United States various drugs available only by prescription, including tapentadol, a Schedule II controlled substance, as well as tramadol, carisoprodol, and modafinil, all Schedule IV controlled substances. In addition, Belani admitted that between 2015 and mid-2017, he worked with two co-conspirators in the United States—William Kulakevich and Julia Fees—to unlawfully smuggle a drug known as etizolam into the United States so that Kulakevich and Fees could resell it via a website they operated—www.etizy.com. Etizolam is part of a class of drugs similar to benzodiazepines, which are often used to treat insomnia and anxiety and carry a potential for abuse and overdose. To evade detection by United States Customs and Border Protection officials, Belani admitted that he and his co-conspirators used false customs declarations that mischaracterized and undervalued the contents of packages sent to the United States by LeeHPL Ventures. In addition, Belani caused drug shipments to be broken into smaller quantities and shipped to multiple addresses to help ensure delivery and avoid interception by United States customs authorities. Likewise, Belani admitted that he caused co-conspirators to initiate payments totaling tens of thousands of dollars from accounts in the United States to accounts he controlled in India or in other locations outside the United States, all as a means to promote his continued efforts to smuggle drugs into the United States.
Belani was extradited to the United States following his arrest in the Czech Republic.
Assistant United States Attorney Eric G. Olshan prosecuted this case on behalf of the government. The United States Food and Drug Administration – Office of Criminal Investigations and Homeland Security Investigations conducted the investigation leading to the Indictment in this case. The Department of Justice’s Office of International Affairs provided significant assistance during the investigation of this matter.
Illegal Alien from Honduras Sentenced for Making False Statement to Border Patrol AgentRead the Press Release
Gulfport, Miss. – Nilson Noe Olivar-Mejia, 42, an illegal alien from Honduras, pled guilty today before Senior U.S. District Judge Louis Guirola, Jr., to making a false statement or representation in a matter under jurisdiction of the United States, announced U.S. Attorney Mike Hurst.
Olivar-Mejia was sentenced by Judge Guirola to time served (effectively four months) and three years of supervised release. He also will face Department of Homeland Security removal proceedings to remove him to his home nation of Honduras. If he were to unlawfully return to the United States during his three-year term of supervised release, Olivar-Mejia could face separate penalties consecutive to imprisonment from additional prosecution. As a result of this felony conviction, if Olivar-Mejia were to unlawfully return, he could face up to ten years in federal prison.
On March 11, 2020, a Border Patrol Agent assigned to the Gulfport, Mississippi Station conducted a vehicle stop on Interstate 10 in Harrison County. Olivar-Mejia did not have a driver’s license, and provided identification documents bearing a name other than his own. After an investigation, including record checks, it was determined that Olivar-Mejia was an illegal alien from Honduras. He was arrested and transported to the Gulfport Border Patrol station, where it was confirmed that Olivar-Mejia had been previously removed in 2005, after being ordered removed by a U.S. Immigration Judge. Olivar-Mejia had unlawfully returned to the United States, and was again removed to Honduras in 2009.
U.S. Attorney Hurst commended the work of the U.S. Department of Homeland Security and the U.S. Border Patrol. Assistant United States Attorney Stan Harris was the prosecutor for the case.
Illegal Alien Sentenced to Federal Prison for Transporting DrugsRead the Press Release
A man who illegally re-entered the United States after being previously deported and who possessed drugs with the intent to distribute, was sentenced July 7, 2020, to 5 years’ in federal prison.
Jacob Rios-Saucedo, age 32, from Mexico, received the prison term after a February 18, 2020, guilty plea to one count of illegal re-entry and one count of possession with intent to distribute a controlled substance.
In a plea agreement, Rios-Saucedo admitted he had illegally entered the United States from Mexico on an unknown date after previously being deported in 2010. On May 5, 2019, law enforcement pulled over Rios-Saucedo for speeding in Woodbury County, Iowa. Law enforcement lawfully conducted a canine search around the car where the canine alerted to the presence of the odor of a narcotic substance. The vehicle was searched, and police found approximately 5 pounds of packaged cocaine in the trunk area of the car, under the spare tire. Rios-Saucedo admitted that about a week before the arrest in Woodbury County, he had picked up the car on the West Coast and drove to the Midwest. He admitted knowing there were drugs in the car, but he did not know what kind or quantity of drugs there were. He was to be paid $3,000 dollars for making the trip. He also admitted to making a prior trip in April 2019, where he drove a car with $17,000 dollars in it from Iowa to the West Coast, and was paid $1,000.
Rios-Saucedo was sentenced in Sioux City by United States District Court Chief Judge Leonard T. Strand. Rios-Saucedo was sentenced to 60 months’ imprisonment. He must also serve a 4-year term of supervised release after the prison term. There is no parole in the federal system.
Rios-Saucedo 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 Kevin C. Fletcher and investigated by the U.S. Immigration and Customs Enforcement and Removal Operations and the Woodbury County Sheriff’s Office.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 19-CR-4035.
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IRS Criminal Investigation and the United States Attorney's Office Remind Taxpayers of Upcoming Tax Filing Deadline; Urge Taxpayers to Remain Vigilant of ScamsRead the Press Release
MUSKOGEE, OKLAHOMA – The Internal Revenue Service Criminal Investigation division and the U.S. Attorney’s Office for the Eastern District of Oklahoma 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 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.”
As the filing deadline approaches, taxpayers should beware of tax and COVID-19 related scams. “The unfortunate reality is that criminals will use any number of methods to attempt to defraud others, including the upcoming federal tax filing deadline,” said U.S. Attorney Brian J. Kuester for the Eastern District of Oklahoma. “It is vitally important for taxpayers to be wary of potential scams directed at stealing personal and financial information. It is not the practice of the IRS to initiate contact with citizens via telephone, e-mail 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.
Grand Jury Returns Three IndictmentsRead the Press Release
MADISON, WIS. -- A federal grand jury in the Western District of Wisconsin, sitting in Madison, returned the following indictments today. You are advised that a charge is merely an accusation and that a defendant is presumed innocent until and unless proven guilty.
La Crosse Man Charged with Drug & Gun Crimes
Joshua Kletzke, 37, La Crosse, Wisconsin, is charged with possessing 50 grams or more of methamphetamine with intent to distribute, possessing a firearm in furtherance of that drug trafficking crime, and being a felon in possession of a firearm. The indictment alleges that on June 9, 2020, he possessed 50 grams or more of methamphetamine with the intent to distribute it and also possessed a loaded .357 Magnum pistol.
If convicted, Kletzke faces a mandatory minimum penalty of five years and a maximum penalty of 40 years in federal prison on the methamphetamine charge. The charge of possessing a firearm in furtherance of a drug trafficking crime carries a mandatory minimum penalty of five years; federal law requires that any sentence imposed for this charge be served consecutive to any sentence imposed on any other criminal charge. The charge of being a felon in possession of a firearm has a maximum penalty of 10 years in federal prison.
The charges against Kletzke are the result of an investigation by the La Crosse Police Department and Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Rita M. Rumbelow is handling the prosecution.
La Crosse Woman Charged with Possessing Methamphetamine for Distribution
Sandy Xiong, 30, La Crosse, Wisconsin, is charged with two counts of possessing 50 grams or more of methamphetamine with the intent to distribute it. The indictment alleges that she possessed the methamphetamine on February 10, 2020.
If convicted, Xiong faces a mandatory minimum penalty of five years and a maximum of 40 years in federal prison on each count. The charges against her are the result of an investigation by the West Central Metropolitan Enforcement Group; La Crosse, Prairie du Chien, and Campbell Police Departments; and the Vernon and Grant County Sheriffs’ Offices. Assistant U.S. Attorney Robert A. Anderson is handling the prosecution.
Wausau Man Charged with Tax Evasion
Leonard Kersten, 55, Wausau, Wisconsin, is charged with three counts of tax evasion. The indictment alleges that Kersten attempted to evade income tax owed by him and his spouse by filing false tax returns which substantially understated his gross income for calendar years 2014, 2015, and 2016.
The indictment alleges that Kersten used his position as a bookkeeper and office manager for a lumber company in Birnamwood, Wisconsin to write checks from the company’s checking account to himself and his spouse, and to create false entries in the company’s general ledger. The indictment alleges that between January 2007 and September 2017, Kersten wrote and concealed approximately $1.7 million in checks, and that he failed to report any of the income from these checks.
If convicted, Kersten faces a maximum penalty of five years in federal prison on each count. The charges against him are the result of an investigation by IRS Criminal Investigation, with assistance from the Office of the U.S. Bankruptcy Trustee. Assistant U.S. Attorney Meredith P. Duchemin is handling the prosecution.
Four Men Indicted for Their Roles in $35 Million Pharmacy Compounded Medication SchemeRead the Press Release
NEWARK, N.J. – A federal grand jury today indicted four men for their roles in a massive compounded medication fraud and kickback scheme they ran out of a pharmacy in Clifton, New Jersey, U.S. Attorney Craig Carpenito announced.
Jeffrey Andrews, 68, of Bryn Mawr, Pennsylvania; Chad Beene, 47, of Philadelphia; and Adam Brosius, 55, and Robert Schneiderman, 77, both of Langhorne, Pennsylvania, are charged with conspiracy to commit health care fraud, health care fraud, conspiracy to violate the Anti-Kickback Statute, and violations of the Anti-Kickback Statute. They will be arraigned at a date to be determined.
According to documents filed in this case and statements made in court:
In early 2014, Brosius, Beene, Andrews, and Schneiderman started using Main Avenue Pharmacy, a mail-order pharmacy with a storefront in Clifton, to run a large fraud and kickback scheme involving compounded drugs like scar creams, pain creams, migraine mediation, and vitamins.
The scheme revolved around identifying compounded drugs that would yield exorbitant reimbursements from health insurers, including both federal and commercial payers. The defendants figured out which compounds were paying the highest reimbursements by having its pharmacists engage in a practice known as “test billing:” the pharmacist would submit a phony claim to insurance to see which compound would generate the highest reimbursements. Main Avenue also received tips from other pharmacies and marketing companies about which compounds were generating the highest reimbursements.
Once Main Avenue identified lucrative formulas for compounds, it would create large prescription pads with precisely those formulas on it. The prescription pad was extremely easy to use – it included check boxes for doctors to select a particular compounded formula. This increased the likelihood that the doctor would not alter the high-paying formula. There was also a place to select up to a dozen refills and a box authorizing the pharmacy to alter the ingredients itself in case an insurer wasn’t covering a particular compounded medication.
Once the prescription pad was set, Main Avenue would disseminate it to marketers across the country with whom it had contractual relationships. The marketing companies would in turn distribute the prescription pad to telemedicine companies and doctors with whom they had a financial arrangement.
By and large, the doctors who signed prescriptions for compounded medications that were filled at Main Avenue had never even spoken to or examined the patient. Once the prescriptions were signed by a doctor, they would be returned to the marketing company, which would transmit the prescription to Main Avenue Pharmacy. Main Avenue would then fill the prescription and submit claims to health care benefit programs for reimbursement. They did so with federal payers like Medicare and Tricare and with commercial payers in New Jersey and elsewhere.
After Main Avenue obtained reimbursement from the health insurers, they would pay kickbacks to the marketers who had generated the prescriptions based on the overall adjudication amount. Main Avenue signed contracts with many of the marketers, and the contracts themselves spelled out the kickback arrangement, which called for Main Avenue to pay each marketer money based on the volume of referrals of compounded prescriptions and the reimbursement amount that Main Avenue received.
Main Avenue would routinely waive copayments of the patients to whom they were sending multiple prescriptions. They did this to ensure that the patients would keep the medications that Main Avenue had sent regardless of whether the patient wanted them. On some occasions, Brosius paid the copayments on behalf of the patients, and falsified money orders from the patients to Main Avenue to make it appear as if the patients had paid their copayments when they had not.
On compounded medications alone, Main Avenue received over $34 million in reimbursements from health care benefit programs. Approximately $8 million of that total was paid by federal payers.
For the conspiracy to commit health care fraud and health care fraud charges, the defendants face a statutory maximum of 10 years in prison and a fine of $250,000, or twice the gross gain or loss from the offense.
For the charge of conspiracy to violate the Anti-Kickback Statute, the defendants face a statutory maximum of five years in prison and a fine of $250,000, or twice the gross gain or loss from the offense. Each individual violation of the Anti-Kickback Statute carries a statutory maximum of 10 years in prison. That offense is also punishable by a $250,000 fine, or twice the gross gain or loss from the offense.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Acting Special Agent in Charge Joe Denahan in Newark; the U.S. Department of Defense, Office of the Inspector General, Defense Criminal Investigative Service, under the direction of Special Agent in Charge Leigh-Alistair Barzey, and the Department of Health and Human Services – Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert, with the ongoing investigation leading to today’s charges.
The government is represented by Assistant U.S. Attorney Jason S. Gould of the Health Care Fraud Unit of the U.S. Attorney’s Office in Newark.
The charges and allegations in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Four Former Corrections Officers Sentenced for Violating Inmates Civil RightsRead the Press Release
Four former corrections officers at the Jackson County Detention Center in Kansas City, Missouri, have been sentenced to terms of imprisonment for their roles in violating the constitutional rights of an inmate by beating the inmate without any legal justification.
Today, U.S. District Court Judge Gary A. Fenner sentenced former corrections officer Travis Hewitt to 45 months imprisonment and former corrections officer Jen-I Pulos to 30 months imprisonment. On June 29, 2020, Judge Fenner sentenced former corrections officer Terrance Dooley to 36 months imprisonment and former corrections officer Dakota Pearce to 24 months imprisonment.
On Oct. 4, 2019, a federal jury found Hewitt, 30, and Dooley, 39, both of Kansas City, Missouri, guilty of participating in a conspiracy to deprive the victim of his civil rights and one count of deprivation of rights. Co-defendants Jen-I Pulos, 34, and Dakota Pearce, 27, both of Kansas City, Missouri, had pleaded guilty the week prior to the trial. Pearce pleaded guilty to his role in the conspiracy and Pulos pleaded guilty to the deprivation of rights.
“The sentences handed down in this case show that law enforcement officers who break the law, violate their oaths, and deprive inmates of their civil rights will be held accountable for their actions” said Assistant Attorney General Eric Dreiband of the Civil Rights Division.
“Nobody is above the law,” said U.S. Attorney Tim Garrison of the Western District of Missouri. “These former corrections officers abused their authority and violated the civil rights of an inmate by physically assaulting him while he was restrained and not posing any threat. As the prosecution of these former officers demonstrates, the Constitution equally protects the rights of all citizens, and equally upholds the accountability of all citizens.”
Hewitt, Dooley, Pulos, and Pearce were formerly employed as corrections officers at the Jackson County Detention Center. Hewitt and Pearce served as acting sergeants. Dooley and Pulos served on the Disturbance Control Team, also known as the Correctional Emergency Response Team, which is responsible for intervening in inmate altercations and neutralizing threats posed by inmates.
The victim, identified in court documents as “J.R.,” was an inmate at the detention center. On July 4, 2015, J.R. was detained on a probation violation related to the monitoring of his release conditions for a felony driving while intoxicated conviction. J.R. was placed in the medical housing unit of the detention center because he was severely confused and disoriented, as he was experiencing severe symptoms of alcohol withdrawal.
At about 7 p.m. another corrections officer allowed J.R. to walk in a secure area outside of his cell. J.R., clearly disoriented and unaware of his whereabouts, attempted to exit the secure area. The corrections officer and J.R. then had a brief physical struggle; the corrections officer called a Code 1, indicating to other officers that she needed assistance.
Hewitt and Pearce responded and placed J.R. in a holding cell. Hewitt, Dooley, Pulos, and Pearce were upset that a supervisor decided J.R. would not be placed in a “restraint chair,” which was commonly used to punish unruly inmates, because J.R. was clearly disoriented and unaware of his surroundings. Several hours later, Dooley and Pulos entered J.R.’s cell, purportedly to remove a comb that had been fashioned into a “shank.” They removed J.R. and transported him to a holding cell (which was out of the range of surveillance cameras). In this holding cell, Hewitt, Dooley, Pulos, and Pearce physically assaulted J.R., while he was handcuffed and not posing a threat to anyone, in order to punish him for the earlier incident. At times during the incident, one of the officers stood outside of the cell and served as a lookout in attempt to ensure that the assault was concealed from other witnesses.
Several hours after the second incident, medical professionals at the detention center decided to transfer J.R. to Truman Medical Center out of a belief that his alcohol withdrawal symptoms had worsened. Truman Medical personnel working in the emergency room, however, quickly determined that J.R. had sustained significant injuries unrelated to alcohol withdrawal. Medical personnel ultimately diagnosed J.R. with broken ribs, a punctured lung, facial bruising, and injuries to his wrists.
This case is being prosecuted by Assistant U.S. Attorney David Ketchmark of the U.S. Attorney’s Office of the Western District of Missouri, and Trial Attorney Shan Patel and Special Litigation Counsel Fara Gold of the Civil Rights Division, Criminal Section, U.S. Department of Justice. It was investigated by the Kansas City Division of the FBI.
Former CEO of Tennessee Pain Management Company Sentenced for Role in Approximately $4 Million Medicare Kickback SchemeRead the Press Release
A Tennessee healthcare executive was sentenced to 42 months in prison followed by one year of supervised release today for his role in an approximately $4 million kickback scheme.
Acting Assistant Attorney General Brian C. Rabbitt of the Justice Department’s Criminal Division, U.S. Attorney Don Cochran of the Middle District of Tennessee, Special Agent in Charge Derrick Jackson of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Atlanta Region, Special Agent in Charge John F. Khin of the U.S. Department of Defense Criminal Investigative Service’s (DCIS) Southeast Field Office, and Director David Rausch of the Tennessee Bureau of Investigation (TBI) Medicaid Fraud Control Unit made the announcement.
John Davis, 42, of Franklin, Tennessee, the former CEO of Comprehensive Pain Specialists (CPS) of Gallatin, Tennessee, was sentenced by U.S. District Judge William Campbell Jr., of the Middle District of Tennessee. Judge Campbell also ordered Davis to forfeit $770,036.00. Davis was convicted of one count of conspiracy to defraud the United States and violate the Anti-Kickback Statute as well as seven counts of violating the Anti-Kickback Statute in April 2019 after a seven-day trial.
According to evidence presented at trial, Davis abused his position as CEO of CPS to arrange for referrals of Medicare durable medical equipment (DME) orders to his co-conspirator, Brenda Montgomery, and her company, CCC Medical. Evidence showed that Davis operated a shell company called ProMed Solutions (ProMed), which he had registered in the name of his wife. Davis received over $770,000 in illegal kickbacks disguised as payments to his wife and ProMed. Together, Davis and Montgomery pocketed over $2.9 million dollars in improper reimbursements from Medicare. Davis used company funds from CPS to pay bonuses to providers who ordered DME for Medicare beneficiaries and referred those orders to CCC Medical. Davis received 60 percent of the Medicare profit from these referrals, while the company he ran lost the opportunity to bill for these services.
Evidence at trial also showed that in April and May of 2015, Davis became concerned about the size of the kickback payments that he was receiving from CCC Medical. To address this concern, Davis and Montgomery engaged in a sham sale of ProMed, which had no assets, no employees, no equipment, no office space, and no customers other than CPS. Evidence further showed that Davis and Montgomery set the price for the sham sale based upon the average monthly kickbacks that Davis had been paid for the previous eight months. When CPS referrals slowed, Davis agreed to reduce the purported “purchase price” to $150,000. When Davis received the last check for the sham sale, he began cutting off referrals to CCC Medical.
Montgomery pleaded guilty on Jan. 7, 2019, to one count of conspiracy to defraud the United States and violate the Anti-Kickback Statute, and seven counts of violations of the Anti-Kickback Statute. She is currently serving a 42-month prison sentence.
This case was investigated by HHS-OIG, with the support of the Defense Criminal Investigative Service, the IRS-Criminal Investigation, and the Tennessee Bureau of Investigation Medicaid Fraud Control Unit and was brought as part of the Medicare Fraud Strike Force. Trial Attorney Anthony Burba of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Taylor J. Phillips of the U.S. Attorney’s Office for the Middle District of Tennessee are prosecuting the case.
The Fraud Section leads the Medicare Fraud Strike Force. Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 15 strike forces operating in 24 districts, has charged more than 4,200 defendants who have collectively billed the Medicare program for approximately $19 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Florida Resident Pleads Guilty to Accessing a Protected Computer without Authorization and Recklessly Causing DamageRead the Press Release
NEW ORLEANS – U.S. Attorney Peter G. Strasser announced that CARLOS DAVID IRIAS, age 47, a resident of Cutler Bay, Florida, pleaded guilty today before United States District Judge Greg G. Guidry to a one-count bill of information charging him with intentionally accessing a protected computer without authorization and recklessly causing damage resulting in loss to Company A, a company in New, Orleans, Louisiana that used to employ IRIAS, of more than $5,000 during one year, in violation of 18 U.S.C. '' 1030(a)(5)(B) and 1030(c)(4)(A).
According to court documents, from about 2012 until August 14, 2017, IRIAS worked for Company A, which was in the business of that developing and distributing specialized urological medical devices including scopes and laser fibers. IRIAS was responsible for designing marketing templates, coordinating sales, and developing client contacts. IRIAS terminated his employment with Company A on August 14, 2017, after which time he was no longer authorized to access Company A’s cloud-based server, which handled marketing-related functions, including storing email contact lists and marketing templates and brochures.
On November 2, 2018, IRIAS accessed Company A’s secured cloud-based computer system from his home in Cutler Bay, Florida without authorization and thereafter exported the contents to a server under his control. He then deleted the information from the cloud-based system. As a result of the unauthorized intrusion, Company A was unable to conduct marketing campaigns from about November 2018 until October 2019. Company A was also unable to contact and communicate with their customer base for approximately two or three months, which jeopardized Company A’s reputation in the specialized field in which it operated. As a result of such conduct, IRIAS recklessly caused damage to Company A, in the amount of approximately $14,593.
IRIAS faces a maximum term of five (5) years in prison, a fine of up to $250,000.00, up to three (3) years of supervised release after imprisonment, and a mandatory $100 special assessment. Sentencing before Judge Guidry has been scheduled for October 15, 2020, at 2:00 pm.
U.S. Attorney Strasser praised the work of the Federal Bureau of Investigation in investigating this matter. Assistant United States Attorney Jordan Ginsberg, Supervisor of the Public Corruption Unit, is in charge of the prosecution.
Federal Grand Jury in El Paso Returns Superseding Indictment against Patrick CrusiusRead the Press Release
In El Paso today, a federal grand jury returned a superseding indictment against Patrick Wood Crusius, 21, with new hate crime and firearm charges stemming from the death of a hospitalized shooting victim, announced Assistant Attorney General for the Civil Rights Division Eric D. Dreiband and U.S. Attorney John F. Bash.
On August 3, 2019, Crusius allegedly opened fire with an assault rifle and shot multiple individuals in and around the Walmart Supercenter in El Paso, leading to the death of 23 individuals and injuring many more. On February 6, 2020, the federal grand jury returned an indictment against Crusius. On April 25, 2020, a victim who had been shot during the incident died as a result of the injuries he sustained.
Today’s federal grand jury superseding indictment includes 23 counts of hate crimes resulting in death (counts 1-23), 23 counts of use of a firearm to commit murder during and in relation to a crime of violence (counts 24-46), 22 counts of hate crimes involving an attempt to kill (counts 47-68), and 22 counts of use of a firearm during and in relation to a crime of violence (counts 69-90).
The superseding indictment alleges that in June 2019, Crusius used the internet to purchase a GP WASR-10 semi-automatic rifle and 1,000 rounds of hollow point ammunition. On August 3, 2019, after substantial planning and premeditation, Crusius took the assault rifle and ammunition and drove from his residence in Allen, TX, to the Walmart Supercenter store located on Gateway West Blvd. where he conducted his attack. The superseding indictment further alleges that just prior to the mass shooting, Crusius uploaded to the internet a document he had drafted entitled “The Inconvenient Truth.” The document opened by stating, “This attack is a response to the Hispanic invasion of Texas. They are the instigators, not me. I am simply defending my country from cultural and ethnic replacement brought on by the invasion.” Among other things, the superseding indictment charges Crusius with willfully causing bodily injury to the victims because of the actual and perceived national origin of any person.
The charges in the superseding indictment carry a maximum penalty of death or life imprisonment. The Attorney General will decide whether to seek the death penalty at a later time.
The case (WTDX case # EP20cr389) has been assigned to U.S. District Judge David C. Guaderrama. There is no trial date at this time. This case is scheduled for a docket call at 2:00pm on October 7, 2020.
The FBI, with the support of the El Paso Police Department, Texas Department of Public Safety, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), El Paso County Sheriff’s Office, El Paso County Office of the Medical Examiner, Allen Police Department and Dallas Police Department, conducted this investigation.
The case is being prosecuted by Assistant U.S. Attorneys Ian Hanna and Greg McDonald of the Western District of Texas, and U.S. Department of Justice Trial Attorneys Tim Visser and Michael Warbel.
It is important to note that an indictment is merely a charge and should not be considered as evidence of guilt. The defendant is considered innocent until proven guilty in a court of law.
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The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Former Bank Executive Sentenced for Using Bank Funds for Luxury Vacations and Other Personal ExpensesRead the Press Release
United States Attorney Matthew D. Krueger announced that on July 8, 2020, Archie G. Overby (age 71; formerly of Waupaca, Wisconsin, and currently of Parker, Texas) was sentenced in federal court following his guilty plea to misapplication of funds by a bank officer, in violation of Title 18 United States Code, Section 656.
According to court filings, Overby had been the President, Chief Operating Officer, and Chairman of the Board of First National Bank in Waupaca. Pursuant to a plea agreement, Overby admitted that starting by 2010 and continuing through 2013, he caused the bank to pay for $1.6 million in travel, entertainment, and other personal expenses for himself, family members, friends, and associates, all of which had no legitimate banking purpose. The expenses included airfare, lodging, and a climbing expedition to Mt. Kilimanjaro, Tanzania, as well as stays at a spa in Arizona and in villas in St. Maarten.
The criminal case followed a civil action by the Office of the Comptroller of Currency (OCC), the bank’s federal regulator. That case, which Overby settled in 2017, resulted in his lifetime prohibition from participation in the financial institution industry, and his agreement to pay $1.6 million in restitution and a $100,000 civil money penalty. After the settlement, however, Overby released a statement asserting that he had admitted no wrongdoing and “never would.” He described the regulator as “overzealous,” claimed to be the victim, and alleged that the regulator improperly had sought to “tarnish his reputation.” As part of his guilty plea, Overby acknowledged not only his criminal conduct but also that the OCC had acted properly and within the bounds of its authority.
Pursuant to the plea agreement accepted by the Court, Senior United States District Court Judge William C. Griesbach did not impose a prison sentence.
Instead, because of Overby’s age and documented and significant health issues, and the potential impact of COVID-19, Judge Griesbach ordered Overby to pay $1.6 million in restitution and forfeit $146,023.35 to the United States.
Judge Griesbach noted that Overby’s criminal conduct, which had gone on for years, was serious and hard to understand, particularly in light of the fact that Overby had been “so well compensated.” Judge Griesbach concluded that it was a betrayal of trust that could only be attributed to “greed and callous disregard for others.” Judge Griesbach explained that “in ordinary circumstances, this case would call for a guideline prison sentence.” However, Judge Griesbach found that due to Overby’s age and demonstrated health issues, exposure to COVID-19 in prison could amount to a death sentence. As such, Judge Griesbach accepted the recommendation that Overby receive a non-custodial sentence.
United States Attorney Krueger stated, “This case serves as an example that professionals who abuse their positions of trust will be held accountable. For years, Archie Overby used his position and authority to treat himself and his family to lavish vacations and to use the financial institution he oversaw as his personal piggy bank. When caught, he tried to portray himself as a victim. I commend the determined work of the regulators and the criminal investigators in bringing Mr. Overby to justice.”
Special Agent in Charge John T. Crawford, FDIC Office of Inspector General, Chicago Region stated “Overby’s guilty plea and sentencing should serve as a warning to others who take advantage of the financial institution industry. Regulators are put in place to monitor the financial industry and law enforcement is at the ready to assist when fraudster’s take advantage of the industry. In this case, our Office, the regulators, and the USAO worked to together to ensure Overby took responsibility for his actions, paid for his actions, and can no longer be in a position to commit further financial institution fraud.”
This case was investigated by Special Agents of the Federal Deposit Corporation-Office of Inspector General and United States Department of Treasury-Office of Inspector General.
The case was prosecuted by Assistant United States Attorney Carol L. Kraft.
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