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2 June 2020
Statement of U.S. Attorney Robert Brewer on George Floyd’s Death and DOJ’s Commitment to the First Amendment and Public SafetyRead the Press Release
Assistant U.S. Attorney Chris Tenorio (619) 909-7556
SAN DIEGO – Last week on Memorial Day, in Minneapolis, MN, George Floyd’s life was taken violently and without justification by law enforcement. His death awakened echoes of recent and historic racism, inequality, and excessive force that has disproportionately affected African-Americans in our country. While this tragic event and subsequent violence over several days affects us all, I appreciate that many of our neighbors are in particular pain and feel vulnerable simply because of the color of their skin.
Having proudly taken an oath to uphold our Constitution, I am always mindful that the laws must be enforced without prejudice or favor: For the benefit and protection of all, regardless of the identity of the perpetrator. The Constitution protects against unreasonable force under color of law. As law enforcement leaders, we must hold everyone—including those who wear the uniform—to the same standard under the law. The obligation to do so is self-evident, but it bears emphasizing that the equal commitment to the law is the only way to protect both victims of police violence and those men and women in uniform who serve our communities with honor.
Wearing a police uniform is one of the hardest jobs in society. We are all indebted to the self-sacrifice and commitment to our communities by those who protect us. But everyone in law enforcement—prosecutors and peace officers—can, and must, do better. The United States Attorney’s Office remains steadfast in its commitment to assisting our law enforcement partners to adopt and employ best policing practices and most effectively and fairly protect all members of our communities.
At the same time, we are equally committed to our long-standing involvement with civic, faith, and other community organizations to combat hate and help our communities chart a better path forward. We will continue our collaboration with the San Diego Regional Hate Crime Coalition to coordinate community outreach, open dialogue, and the prevention of hate incidents and discrimination. With our local and state partners, we will continue to zealously investigate and prosecute hate crimes that cause far-reaching damage to entire communities.
The Constitution strongly protects the First Amendment right of all to speak out and peacefully protest. The violence by a relatively small number of opportunists who have sought to wreak havoc, destroy property, and threaten the safety of peaceful protestors and law enforcement alike, clearly detract from our ability to heal from the wounds of Mr. Floyd’s death and to seek that better path forward. One of the great defining features of this country is our adherence to the rule of law. We do not have to choose between our obligation to enforce the law and our personal outrage. Nor are we required to leave behind our own feelings of empathy and sadness in enforcing the law against those who seek to break it, while facilitating peaceful protest, another hallmark of American democracy.
We are fortunate to be a part of a strong, resilient and collaborative San Diego community. I have been in constant contact over the last four days with our federal, state, and local law enforcement partners to support and coordinate our collective response to acts of violence as we protect peaceful protestors and our communities. The cooperation and collaboration among our first responders has been impressive, and their intent to work with our community and address their concerns is clear. Together, while condemning the underlying problems that led to Mr. Floyd’s senseless death and the violence in the aftermath, we are taking a strong stand and affirming our enduring commitment to the equal protection and justice for all.
Statement of U.S. Attorney Craig CarpenitoRead the Press Release
As I said in the wake of the despicable hate crimes committed in Jersey City last December, we are confronting problems in this state and this country that I cannot believe we are still facing at this point in our history. I emphatically reject the idea that violence is the solution to those problems. I am proud of the people of Newark, Camden and elsewhere who have raised their voices in peaceful protest to seek justice for George Floyd and the many other victims like him, and to call for change.
A few individuals are using these protests as cover to commit violent acts and damage our communities. They are not honoring the memory of George Floyd. They do not work to ensure justice for his memory, his family or his loved ones. They hide behind his name to further their own agendas. They may think that they can worsen the divide that responsible community, civic and governmental leaders have engaged with one another to try to close for years. They are wrong.
I know this engagement works because I see the impact of productive community and law enforcement partnerships every day in Newark, Camden, and elsewhere. As I watch the police and the community grow together, I see crime go down. I know that members of the community intervened during the past several days to prevent a few individuals from turning a peaceful protest violent. I commend their brave stand, and I say to them: we will not allow the actions of the lawless few to silence the voice of the many.
The U.S. Attorney’s Office will continue to protect the right of all people to assemble and protest peacefully, without interruption from those bent on violence or destruction. We will continue to investigate and prosecute those police officers who abuse their power through the unlawful use of force and other violations of our citizens’ civil rights. We will also intervene wherever individuals try to distract from these valid causes by engaging in riots, arson and looting. We will bring all of these wrongdoers to justice.
Our work sends a strong message: New Jersey will not tolerate the victimization of our people, our cities, our businesses, our law enforcement and our government. Justice will prevail.
Statement from United States Attorney G. Zachary TerwilligerRead the Press Release
ALEXANDRIA, Va. – These have been difficult and challenging times over the past 10 weeks due first to a pervasive pandemic and now as a result of great societal unrest. We witnessed the harrowing and disturbing video images of the death of George Floyd. We watched many peaceful protestors exercise their constitutional rights to protest legitimate grievances. And while it should be a time for the nation to grieve, scream, pray, shake with anger, reconcile, and heal, some have turned to violence, destruction, arson, assault, and domestic terrorism.
Many individuals gathering to protest in the Eastern District have done so peacefully. Unfortunately, there are some individuals who seek to actively undermine the efforts of peaceful protestors by inciting violence and destroying the very physical and figurative sinew of local communities of which they are not members.
Following the decisive leadership of Attorney General Barr, we will utilize the existing framework of the Joint Terrorism Task Force model to identify, apprehend and prosecute anyone who uses the guise of protest to incite violence and violate federal laws.
As always, we stand ready to support our federal, state, and local law enforcement officers who bravely put themselves in harm’s way to ensure citizens across the Commonwealth can safely exercise their First Amendment rights.
Statement from Assistant Attorney General Eric Dreiband and Michigan U.S. Attorneys on Michigan Governor's Decision to Adjust Reopening PlansRead the Press Release
Assistant Attorney General for Civil Rights Eric Dreiband, U.S. Attorney Matthew Schneider for the Eastern District of Michigan, and U.S. Attorney Andrew Birge for the Western District of Michigan issued the following statement:
“Following action by the Department of Justice Civil Rights Division, Governor Whitmer provided much-needed relief for Michiganders by rescinding her executive orders which had required certain retail business to operate ‘by appointment only,’ prohibited other businesses that sued the governor from having the face-to-face meetings necessary to operate, even while practicing social distancing, and had required Michiganders to stay home.”
“We thank the governor for moving to Stage 4 of the Michigan Safe Start Plan, which better respects the constitutional liberties of Michiganders, especially when it comes to their ability to maintain their economic livelihood. Some Michigan businesses, such as indoor gyms, hair salons, barbershops, indoor theaters and some similar venues remain closed. Additionally, there is ongoing litigation challenging whether state law authorizes the governor’s COVID-19 orders. The Department of Justice will continue to prioritize Attorney General Barr’s Memorandum regarding Balancing Public Safety with the Preservation of Civil Rights and to monitor the legality of the process of reopening in Michigan."
Background
On Friday, May 29, 2020, the Department of Justice filed a statement of interest in a Michigan federal court in support of a lawsuit filed by seven businesses challenging the restrictions imposed by Governor Gretchen Whitmer in response to the COVID-19 pandemic. That statement of interest explained that the governor’s COVID-19 orders, however well-intentioned, raised constitutional concerns by imposing what appeared to be arbitrary and unreasonable limits on how and ultimately whether certain businesses could operate in Michigan relative to other similarly situated businesses. The statement of interest also explained that the federal Constitution provides for a cohesive national economy for all 50 states and all Americans and that the governor’s COVID-19 orders may be unduly interfering with interstate commerce.
Matthew Schneider, U.S. Attorney for the Eastern District of Michigan, and Assistant Attorney General Dreiband, are overseeing the Justice Department’s effort to monitor state and local policies relating to the COVID-19 pandemic.
The federal case is Signature Sotheby’s International Realty, Inc., et al. v. Whitmer, No. 1:20-00360 and additional information about the department’s May 29 statement of interest can be found here: https://www.justice.gov/opa/pr/department-justice-files-statement-interest-support-businesses-suffering-arbitrary-and
Statement from Assistant Attorney General Eric Dreiband and Michigan U.S. Attorneys on Michigan Governor's Decision to Adjust Reopening PlansRead the Press Release
WASHINGTON - Assistant Attorney General for Civil Rights Eric Dreiband, U.S. Attorney Matthew Schneider for the Eastern District of Michigan, and U.S. Attorney Andrew Birge for the Western District of Michigan issued the following statement:
“Following action by the Department of Justice Civil Rights Division, Governor Whitmer provided much-needed relief for Michiganders by rescinding her executive orders which had required certain retail business to operate ‘by appointment only,’ prohibited other businesses that sued the governor from having the face-to-face meetings necessary to operate, even while practicing social distancing, and had required Michiganders to stay home.”
“We thank the governor for moving to Stage 4 of the Michigan Safe Start Plan, which better respects the constitutional liberties of Michiganders, especially when it comes to their ability to maintain their economic livelihood. Some Michigan businesses, such as indoor gyms, hair salons, barbershops, indoor theaters and some similar venues remain closed. Additionally, there is ongoing litigation challenging whether state law authorizes the governor’s COVID-19 orders. The Department of Justice will continue to prioritize Attorney General Barr’s Memorandum regarding Balancing Public Safety with the Preservation of Civil Rights and to monitor the legality of the process of reopening in Michigan."
Background
On Friday, May 29, 2020, the Department of Justice filed a statement of interest in a Michigan federal court in support of a lawsuit filed by seven businesses challenging the restrictions imposed by Governor Gretchen Whitmer in response to the COVID-19 pandemic. That statement of interest explained that the governor’s COVID-19 orders, however well-intentioned, raised constitutional concerns by imposing what appeared to be arbitrary and unreasonable limits on how and ultimately whether certain businesses could operate in Michigan relative to other similarly situated businesses. The statement of interest also explained that the federal Constitution provides for a cohesive national economy for all 50 states and all Americans and that the governor’s COVID-19 orders may be unduly interfering with interstate commerce.
Matthew Schneider, U.S. Attorney for the Eastern District of Michigan, and Assistant Attorney General Dreiband, are overseeing the Justice Department’s effort to monitor state and local policies relating to the COVID-19 pandemic.
The federal case is Signature Sotheby’s International Realty, Inc., et al. v. Whitmer, No. 1:20-00360 and additional information about the department’s May 29 statement of interest can be found here: https://www.justice.gov/opa/pr/department-justice-files-statement-interest-support-businesses-suffering-arbitrary-and
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.
Sioux City Husband and Wife Sentenced for Encouraging Aliens from Guatemala to Enter the United States IllegallyRead the Press Release
A husband and wife who encouraged and induced a father and his minor daughter to illegally enter in the United States were recently sentenced in federal court in Sioux City. Cristobal Francisco Nicolas was sentenced on May 29, 2020, to 18 months’ in federal prison. Amy Francisco was sentenced on March 20, 2020, to 12 months’ and 1 day in federal prison.
Amy Francisco, age 40, a citizen of the United States, and Cristobal Nicolas, age 37, a citizen of the Republic of Guatemala, both residing in Sioux City, Iowa, received the prison terms after pleading guilty to encouraging and inducing an alien to enter or reside in the United States in violation of law. Cristobal Nicolas was also convicted for unlawful possession of identification documents.
Information disclosed during the case showed that Amy Francisco and Cristobal Francisco illegally encouraged and induced aliens to enter or reside in the United States. Specifically, they encouraged aliens from Guatemala to enter the country. The Franciscos arranged for them to come to Sioux City, Iowa. Amy Francisco and Cristobal Francisco knew the aliens, a father and daughter, were citizens of Guatemala and were not permitted to enter or reside in the United States.
Further information showed that Amy Francisco and Cristobal Francisco encouraged a father and his minor daughter to enter the United States. The Franciscos admitted they intended to have the minor daughter serve as a surrogate mother for their baby. The Franciscos proposed to pay for all expenses incurred during the pregnancy, birth, and adoption of the baby. They also promised the daughter she could further her education and work to earn money while in the United States. The Franciscos also agreed to help find the father work in the country.
In the spring of 2019, the Franciscos, using the services of individuals outside the United States, arranged for the father and daughter to travel from Guatemala to the United States. After the father and daughter arrived in the country, the Franciscos paid for them to fly to Omaha, Nebraska, and eventually to travel to the Franciscos’ Sioux City home. The father and daughter stayed at the Franciscos’ home from May 31, 2019, through June 4, 2019. On June 4, 2019, the daughter ran away from the home. Officers from the Sioux City Police Department found her after she ran away.
Cristobal Francisco Nicolas was sentenced in Sioux City by United States District Court Chief Judge Leonard T. Strand. Cristobal Francisco Nicolas was sentenced to 18 months’ imprisonment. He must also serve a 2-year term of supervised release after the prison term. There is no parole in the federal system. Amy Francisco was also sentenced in Sioux City by United States District Court Chief Judge Leonard T. Strand. Amy Francisco was sentenced to 12 months’ and 1 day imprisonment. She must also serve a 2-year term of supervised release after the prison term. There is no parole in the federal system.
Cristobal Francisco Nicolas and Amy Francisco are being held in the United States Marshal’s custody until they can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Kevin C. Fletcher and investigated by the Immigration and Customs Enforcement, Homeland Security Investigations, and the Sioux City Police Department.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 19-CR-4045.
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Rochester Man Pleads Guilty to Unlawfully Possessing a FirearmRead the Press Release
CONCORD - Remy Martin Lopez, 35, of Rochester, pleaded guilty in federal court to unlawfully possessing a firearm, United States Attorney Scott W. Murray announced today.
According to court documents and statements made in court, on August 23, 2019, Lopez was found in possession of a firearm that had been reported stolen earlier in the week. Lopez had previously been convicted of a felony in the State of Florida and is legally prohibited from possessing firearms.
Lopez is scheduled to be sentenced on September 9, 2020.
“In order to prevent gun-related violence, federal law prohibits convicted felons from possessing firearms,” said U.S. Attorney Murray. “Aggressive enforcement of this law clearly helps to maintain public safety. We will continue to work closely with the Rochester Police Department, ATF, and all of our law enforcement partners to identify and prosecute criminals who unlawfully possess firearms or otherwise threaten the public.”
“Today’s guilty plea demonstrates the outstanding partnership between the Rochester Police Department, the ATF, and the United States Attorney’s Office and the commitment we share to work together to interdict illegal firearms and the criminals that compromise the safety of our communities.” Kelly D. Brady, Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”) Special Agent in Charge.
This matter was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives with assistance from the Rochester Police Department. The case is being prosecuted by Assistant U.S. Attorney Anna Krasinski.
The case is part of ATF’s Project Safe Neighborhoods initiative, which is a federally-funded program intended to reduce gun violence through law enforcement training, public education, and aggressive law enforcement efforts to investigate and prosecute gun-related crimes.
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Reno Resident Indicted for Possession, Receipt, and Distribution of Thousands of Images of Child PornographyRead the Press Release
RENO, Nev. – Brandon Eric Navarrete, 27, of Reno, was arraigned in federal court today on an indictment charging him for allegedly unlawfully possessing, receiving, and distributing approximately 17,000 images and videos of child pornography, announced U.S. Attorney Nicholas A. Trutanich for the District of Nevada.
Navarrete was arrested Monday morning. He appeared today before U.S. Magistrate Judge Carla L. Baldwin who scheduled a jury trial before Chief U.S. District Judge Miranda M. Du on July 14, 2020.
According to allegations presented in the indictment and during today’s court proceedings, the National Center for Missing and Exploited Children received a CyberTip from SmugMug Inc. — a paid image sharing, image hosting service, and online video platform — regarding possible child pornography on its servers. On the basis of that tip, a search warrant was executed at Navarrete’s residence in Reno. A forensic analysis of the electronic devices that were seized revealed approximately 14,000 images of child pornography and approximately 300 video files depicting child pornography. The images and videos included children under 12 years old.
If convicted, Navarrete faces a statutory maximum sentence of 20 years in prison and a $250,000.00 fine. In addition to imprisonment and fines, Navarrete also faces a period of supervised release following any term of imprisonment imposed, restitution, and monetary penalties. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes only. If convicted of an offense, the sentencing of a defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
An indictment merely alleges that crimes have been committed. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
This case is the product of a joint investigation by the Internet Crimes Against Children Task Force, the FBI's Northern Nevada Child Exploitation & Human Trafficking Task Force, the Washoe County Sheriff’s Office, the Sparks Police Department, the Reno Police Department, and the Nevada Highway Patrol. Assistant U.S. Attorney Randolph St. Clair is prosecuting the case.
If you have information regarding possible child sexual exploitation, please make a report to the National Center for Missing and Exploited Children by calling the 24-hour hotline at 1-800-THE-LOST (1-800-843-5678) or by making a report at www.cybertipline.com.
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 U.S. Attorney’s Offices and the Department of Justice’s Child Exploitation and Obscenity Section, 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.
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Pittsburgh Teen was Drug Runner for South Side Gang’s Distribution NetworkRead the Press Release
PITTSBURGH, PA – A resident of Pittsburgh pleaded guilty in federal court to charges related to drug trafficking in connection with a large-scale investigation conducted by the Greater Pittsburgh Safe Streets Task Force, United States Attorney Scott W. Brady announced today.
Roderick Ferguson, 19, pleaded guilty to one count of conspiracy to distribute and possess with intent to distribute heroin and fentanyl, before United States District Judge William S. Stickman IV. Mr. Ferguson is one of 36 defendants charged in the Indictment.
In connection with the guilty plea, the court was advised that 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 revealed that Mr. Ferguson was a drug runner for his co-defendant, Christopher Highsmith, who is among the leaders of the drug trafficking organization. As a condition of the guilty plea, Ferguson accepted responsibility for the distribution of 15 grams of a mixture of fentanyl and heroin in the Pittsburgh area. The court was further informed that on June 20, 2019, law enforcement seized a Sig Sauer firearm and ammunition during the execution of a search warrant at the defendant’s residence at on West Warrington Avenue in Pittsburgh.
Judge Stickman scheduled sentencing for October 15, 2020, at 10:30 a.m. The law provides for a total sentence of not more than 20 years in prison, a fine of up to $1,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant. Ferguson is on bond pending sentencing.
Assistant United States Attorney Christy C. Wiegand is prosecuting this case on behalf of the government.
Pierre Man Sentenced for Meth TraffickingRead the Press Release
United States Attorney Ron Parsons announced that a Pierre, South Dakota, man convicted of Conspiracy to Distribute Methamphetamine was sentenced on June 1, 2020, by Chief Judge Roberto A. Lange, U.S. District Court.
Charles Olson, a/k/a Chip Olson, age 48, was sentenced to 84 months in federal prison, followed by 4 years of supervised release, a $1,000 fine, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Olson was indicted by a federal grand jury on October 16, 2019. He pled guilty on March 9, 2020.
The conviction stemmed from a conspiracy that occurred between December 1, 2018, and October 16, 2019, in which Olson, knowingly and intentionally, conspired and agreed with others to knowingly and intentionally distribute and possess with intent to distribute methamphetamine in and around the Pierre and Ft. Pierre Communities. As part of the conspiracy, Olson and his co-defendants traveled to Denver, Colorado to pick up methamphetamine. On June 23, 2019, Olson was involved in a traffic stop, wherein 236 grams of methamphetamine, a scale, pipes, and other items of distribution were found.
This case was investigated by the Northern Plains Safe Trails Drug Enforcement Task Force, the Pierre Police Department, and the South Dakota Highway Patrol. Assistant U.S. Attorney Meghan N. Dilges prosecuted the case.
Olson was immediately turned over to the custody of the U.S. Marshals Service.
Philadelphia Woman Indicted in $68 Million Securities Fraud SchemeRead the Press Release
NEWARK, N.J. – An investment fund manager was indicted today in connection with an alleged $68 million securities fraud scheme, U.S. Attorney Craig Carpenito announced.
Brenda Smith, 59, of Philadelphia, Pennsylvania, was indicted on six counts of wire fraud and one count of securities fraud. Smith was initially charged by complaint in August 2019.
According to documents filed in this case and statements made in court:
Smith managed and controlled Broad Reach Capital LP, a purported investment fund. Broad Reach Capital was a pooled investment fund/hedge fund that was established in February 2016 and was open to accredited investors with a minimum investment of $1 million.
From February 2016 through August 2019, Smith allegedly orchestrated a scheme in which she made misrepresentations to investors and promised that she would invest their funds in particular trading strategies that Broad Reach Capital was optimally situated to execute. Smith referred to these strategies as dividend capture, VIX Convergence, and opportunistic trading. Instead of investing the money as she advertised, Smith diverted tens of millions of dollars of investor funds out of Broad Reach Capital for purposes inconsistent with the trading strategies, including for personal use and to pay out millions of dollars to other investors.
Smith misrepresented the success and performance of Broad Reach Capital to investors and prospective investors. She touted Broad Reach Capital as a trade-focused investment fund that was highly liquid and employed a robust risk management program. Smith distributed written materials about Broad Reach Capital to investors and prospective investors that included purported historical performance information, such as claimed annual returns of over 33 percent in 2017 and positive monthly returns in 2018. In fact, the total cash and securities in the Broad Reach Capital bank and brokerage accounts decreased from December 2016 through June 2019. For example, the written materials claimed that Broad Reach Capital had a 1.76 percent return in February 2018 when in reality, Broad Reach Capital’s brokerage accounts lost over 50 percent of their value.
To lull investors and induce them to continue investing, Smith provided monthly account statements that falsely showed that their investments were safe and earning significant returns. Smith also falsely represented that she was personally invested in Broad Reach Capital and provided a fictitious account statement to at least one investor.
As part of the fraudulent scheme, Smith collected more than $68 million of cash into Broad Reach Capital from approximately 40 investors. At its peak, however, the value of cash and securities in the Broad Reach Capital bank and brokerage accounts did not exceed $32 million. Instead of investing the money as she promised, Smith transferred tens of millions of dollars out of Broad Reach Capital to entities she controlled for purposes inconsistent with its trading strategies, including more than $10 million for mineral mining operations and $2 million for American Express credit card bills. When investors requested redemption of their investments, Smith diverted other investors’ funds to pay the requested redemption amounts.
The wire fraud counts carry a maximum penalty of 20 years and a $250,000 fine, or twice the gross amount of gain or loss from the offense, whichever is greater. The securities fraud count carries a maximum penalty of 20 years in prison and a $5 million fine.
The U.S. Securities and Exchange Commission (SEC) Philadelphia Regional Office previously filed a civil complaint against Smith based on the same conduct.
U.S. Attorney Carpenito credited special agents of the FBI Philadelphia Division, under the direction of Special Agent in Charge Michael Driscoll, and special agents of the U.S. Attorney’s Office with the investigation leading to today’s charges. He also thanked the U.S. Securities and Exchange Commission’s Philadelphia Regional Office, under the direction of Director Kelly L. Gibson, for its assistance.
The government is represented by Assistant U.S. Attorneys Catherine R. Murphy and Andrew Macurdy of the U.S. Attorney’s Office Economic Crimes Unit.
The charges and allegations in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Owners of Texas and Mississippi Laboratories Admit Roles in Kickback Scheme Related to Genetic TestingRead the Press Release
NEWARK, N.J. – The owners of two clinical laboratories in Texas and Mississippi today admitted their roles in a scheme to pay kickbacks in exchange for referrals of patient DNA samples and genetic tests to the laboratories, U.S. Attorney Craig Carpenito announced.
Sherman Kennerson, 55, of Plano, Texas, and Jeffrey Madison, 54, of DeSoto, Texas, each pleaded guilty by videoconference before U.S. District Judge Brian R. Martinotti to one count of conspiracy to defraud the United States in connection with a scheme to violate the Anti-Kickback Statute.
According to documents filed in this case and a related matter and statements made in court:
Kennerson and Madison co-owned and operated with other individuals Spectrum Diagnostic Labs LLC (Spectrum Lab) and Metric Lab Services LLC (Metric Lab), two clinical laboratories, located in Texas and Mississippi, respectively, that performed genetic tests and submitted claims to Medicare. Kennerson and Madison oversaw the laboratories’ marketing and sales operations through which outside marketing groups recruited physicians to refer patients’ DNA samples to the laboratories for genetic tests and related services.
Kennerson and Madison paid bribes to Ark Laboratory Network LLC (Ark), one the marketing groups for Spectrum Lab and Metric Lab, and Jeffrey Tamulski, to induce Ark to refer patients’ DNA samples to the laboratories. Tamulski and the owners of Ark, Edward B. Kostishion, Jeremy M. Richey, and Kacey C. Plaisance, were previously charged by indictment in September 2019 in connection with a related kickback conspiracy involving referrals to laboratories for genetic testing. Plaisance pleaded guilty to his role in the conspiracy on May 6, 2020.
As part of the scheme, the laboratories entered into sham agreements with Ark and Tamulski under which Ark purported to provide various consulting, marketing, and other services at an hourly rate. Kennerson and Madison, however, paid Ark and Tamulski in exchange for referrals and DNA samples based on a percentage of the revenue the laboratories received from federal health care programs, including Medicare. Once the amount of the bribe was calculated, Ark and Tamulski drafted and submitted sham invoices to the laboratories that backed into the agreed upon bribe amount and attempted to conceal the scheme through describing various services provided at hourly rates. Metric Lab paid Ark over $136,000 in bribes and the laboratories received over $517,000 in payments from Medicare for claims connected to the kickback scheme with Ark and Tamulski.
The conspiracy charge to which Kennerson and Madison each pleaded guilty carries a maximum penalty of five years in prison and a fine of $250,000, or twice the gross grain or loss from the offense, whichever is greatest. Sentencing for both defendants is scheduled for Oct. 5, 2020.
U.S. Attorney Carpenito credited the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert; and special agents of the U.S. Attorney’s Office for the District of New Jersey, with the investigation leading to today’s guilty pleas.
The government is represented by Senior Trial Counsel Bernard J. Cooney of the Health Care Fraud Unit of the U.S. Attorney’s Office in Newark.
The charge and allegations against the remaining defendants are merely accusations, and they are presumed innocent unless and until proven guilty.
Owings Mills Man Sentenced to Eight Years in Federal Prison for Possessing a Firearm in Furtherance of Drug TraffickingRead the Press Release
Baltimore, Maryland – U.S. District Judge Ellen L. Hollander today sentenced Timothy Herndon, age 29, of Owings Mills, Maryland, to eight years in federal prison, followed by four years of supervised release, for possession of a firearm in furtherance of a drug trafficking crime.
The sentence was announced by United States Attorney for the District of Maryland Robert K. Hur and Special Agent in Charge Timothy Jones of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Baltimore Field Division.
United States Attorney Robert K. Hur stated, “Timothy Herndon brought danger to our community through the deadly combination of guns and drugs. Now he will serve eight years in federal prison, where there is no parole—ever. Please, put down the guns and save a life—maybe even your own.”
According to Herndon’s plea agreement, on the morning of May 16, 2019, members of the ATF executed a search warrant at Herndon’s residence. After being read his Miranda warnings, Herndon told investigators that he had placed a firearm in a shoebox in the second-floor bedroom. Investigators recovered that firearm, then searched the rest of the residence.
In the living room, investigators recovered one clear bag containing multiple black plastic zip lock baggies of crack cocaine and approximately $2,000 in cash. In the kitchen trashcan under the trash bag, they found drug paraphernalia and one round of 9-millimeter ammunition. From underneath the dishwasher, investigators recovered three loaded firearms; two clear plastic sandwich bags containing cocaine; additional drug paraphernalia; and a paper bag containing a large amount of cash.
United States Attorney Robert K. Hur commended the Bureau of ATF for their work in the investigation. Mr. Hur thanked Assistant U.S. Attorneys Zachary Stendig and Lindsey McCulley, who prosecuted the case.
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Oklahoma Contractors to Pay $2.8 Million to Settle False Claims Act Allegations Concerning Fraudulently Obtained Small Business ContractsRead the Press Release
OKLAHOMA CITY – Tulsa, Oklahoma-based contractor the Ross Group Construction Corporation (Ross Group), and its corporate affiliates, have agreed to pay over $2.8 million to settle allegations that they violated the False Claims Act by improperly obtaining federal set-aside contracts reserved for disadvantaged small businesses, the Justice Department announced today.
"Small business set-aside contracts provide opportunities for small businesses to participate in federal contracting and gain valuable experience to help them compete for future economic opportunities," said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division. "We will pursue those who knowingly obtain set-aside contracts to which they are not entitled and thereby prevent deserving small businesses from receiving the assistance that Congress intended."
To qualify as a small business for purposes of U.S. Small Business Administration (SBA) programs, companies must meet defined eligibility criteria, including requirements concerning size, ownership, and operational control. The settlement with Ross Group resolves allegations that the company fraudulently induced the government to award certain small business set-aside contracts to several affiliated entities that did not meet eligibility requirements. The United States alleged that Ross Group created two companies, PentaCon LLC and C3 LLC, to obtain small business set-aside contracts for which Ross Group itself was ineligible. The United States further alleged that Ross Group maintained operational control over the day-to-day and long-term management decisions of the two purported small businesses, including controlling their financial affairs and business operations, and that, as a result, neither PentaCon nor C3 satisfied the size and eligibility requirements to participate in the set-aside programs. Ross Group, PentaCon, and C3 allegedly concealed their affiliation from the United States and knowingly misrepresented the eligibility of PentaCon and C3 for the set-aside contracts.
"It is critical that we protect the integrity of federal government contract programs so that taxpayer money goes only to those who legitimately qualify for assistance," said U.S. Attorney Timothy J. Downing for the Western District of Oklahoma. "We will continue to hold accountable those who make false statements to take unfair advantage of programs for which they would not otherwise qualify, because it deprives legitimate applicants from obtaining these necessary benefits. I want to specifically thank the Defense Criminal Investigative Service for their outstanding and thorough investigative work in this case."
"SBA’s preferential contracting programs are intended to promote development of eligible small businesses," said Small Business Administration Inspector General Hannibal "Mike" Ware. "OIG will continue to work with its law enforcement partners to identify, investigate, and pursue people and businesses who abuse these programs by trying to participate through front companies. I want to thank the Department of Justice and the other Federal agencies involved for their dedication to pursuing justice in this case."
"This settlement highlights the commitment of the Defense Criminal Investigative Service (DCIS) and its law enforcement partners to protect the integrity of the Department of Defense (DoD) contracting process," said Michael Mentavlos, Special Agent in Charge of the DCIS Southwest Field Office. "DCIS will continue to investigate fraud and corruption targeting DoD programs by pursuing all available remedies possible."
The settlement with Ross Group and its corporate affiliates resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. The civil lawsuit was filed in federal district court in the Western District of Oklahoma and is captioned United States ex rel. Southwind Construction Services, LLC v. The Ross Group Construction Corporation, et al., Case No. 15-0102-R (W.D. Okla.). As part of today’s resolution, the whistleblower will receive approximately $520,000.
The settlement is the result of a coordinated effort among the Civil Division’s Commercial Litigation Branch, the United States Attorney’s Office for the Western District of Oklahoma, DCIS, the Inspector General Offices of the SBA, General Services Administration, and the Department of Veterans Affairs, and the Army Criminal Investigation Division Major Procurement Fraud Unit.
To learn more about the Civil Division, please visit https://www.justice.gov/civil. To learn more about the U.S. Attorney’s Office for Western District of Oklahoma, please visit https://www.justice.gov/usao-wdok. To download a photo of U.S. Attorney Downing, click here.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Oklahoma Contractors to Pay $2.8 Million to Settle False Claims Act Allegations Concerning Fraudulently Obtained Small Business ContractsRead the Press Release
Tulsa, Oklahoma-based contractor the Ross Group Construction Corporation (Ross Group), and its corporate affiliates, have agreed to pay over $2.8 million to settle allegations that they violated the False Claims Act by improperly obtaining federal set-aside contracts reserved for disadvantaged small businesses, the Justice Department announced today.
“Small business set-aside contracts provide opportunities for small businesses to participate in federal contracting and gain valuable experience to help them compete for future economic opportunities,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division. “We will pursue those who knowingly obtain set-aside contracts to which they are not entitled and thereby prevent deserving small businesses from receiving the assistance that Congress intended.”
To qualify as a small business for purposes of U.S. Small Business Administration (SBA) programs, companies must meet defined eligibility criteria, including requirements concerning size, ownership, and operational control. The settlement with Ross Group resolves allegations that the company fraudulently induced the government to award certain small business set-aside contracts to several affiliated entities that did not meet eligibility requirements. The United States alleged that Ross Group created two companies, PentaCon LLC and C3 LLC, to obtain small business set-aside contracts for which Ross Group itself was ineligible. The United States further alleged that Ross Group maintained operational control over the day-to-day and long-term management decisions of the two purported small businesses, including controlling their financial affairs and business operations, and that, as a result, neither PentaCon nor C3 satisfied the size and eligibility requirements to participate in the set-aside programs. Ross Group, PentaCon, and C3 allegedly concealed their affiliation from the United States and knowingly misrepresented the eligibility of PentaCon and C3 for the set-aside contracts.
“It is critical that we protect the integrity of federal government contract programs so that taxpayer money goes only to those who legitimately qualify for assistance,” said U.S. Attorney Timothy J. Downing for the Western District of Oklahoma. “We will continue to hold accountable those who make false statements to take unfair advantage of programs for which they would not otherwise qualify, because it deprives legitimate applicants from obtaining these necessary benefits. I want to specifically thank the Defense Criminal Investigative Service for their outstanding and thorough investigative work in this case.”
“SBA’s preferential contracting programs are intended to promote development of eligible small businesses,” said Small Business Administration Inspector General Hannibal “Mike” Ware. “OIG will continue to work with its law enforcement partners to identify, investigate, and pursue people and businesses who abuse these programs by trying to participate through front companies. I want to thank the Department of Justice and the other federal agencies involved for their dedication to pursuing justice in this case.”
“This settlement highlights the commitment of the Defense Criminal Investigative Service (DCIS) and its law enforcement partners to protect the integrity of the Department of Defense (DoD) contracting process,” said Michael Mentavlos, Special Agent in Charge of the DCIS Southwest Field Office. “DCIS will continue to investigate fraud and corruption targeting DoD programs by pursuing all available remedies possible.”
The settlement with Ross Group and its corporate affiliates resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. The civil lawsuit was filed in federal district court in the Western District of Oklahoma and is captioned United States ex rel. Southwind Construction Services, LLC v. The Ross Group Construction Corporation, et al., Case No. 15-0102-R (W.D. Okla.). As part of today’s resolution, the whistleblower will receive approximately $520,000.
The settlement is the result of a coordinated effort among the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the Western District of Oklahoma, DCIS, the Inspector General Offices of the SBA, General Services Administration, and the Department of Veterans Affairs, and the Army Criminal Investigation Division Major Procurement Fraud Unit.
To learn more about the Civil Division, please visit https://www.justice.gov/civil. To learn more about the U.S. Attorney’s Office for Western District of Oklahoma, please visit https://www.justice.gov/usao-wdok.
The claims resolved by the settlement are allegations only, and there has been no determination of liability.
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.
Ohio Man Sentenced to 120 Months for Methamphetamine TraffickingRead the Press Release
COVINGTON, Ky. - An Ohio man, Isaac Benson, 44, was sentenced in federal court on Tuesday, to 120 months in prison, by U.S. District Judge David Bunning, after being convicted of possession with intention to distribute 50 grams or more of methamphetamine.
According to Benson’s guilty plea agreement, in June 2019, he admitted to bringing 100 grams of methamphetamine, from Dayton, Ohio, to Newport, Ky., to sell to a confidential informant. Benson’s vehicle was stopped by law enforcement, who found the methamphetamine and $3,624 in cash.
Benson pleaded guilty in November 2019.
Under federal law, Benson must serve 85 percent of his prison sentence and will be under the supervision of the U.S. Probation Office for five years.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Jeffrey Todd Scott, Special Agent in Charge, DEA Louisville Field Division; and Christopher Conners, Director of the Northern Kentucky Drug Strike Force, jointly made the announcement.
The investigation was directed by the DEA and the Northern Kentucky Drug Strike Force. The United States was represented by Assistant U.S. Attorney Wade Napier.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
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Niagara Falls Police Department Getting $2.3 Million Dollars as Department of Justice Awards Nearly $400 Million Dollars for Law Enforcement Hiring to Advance Community Policing; Chemung County to Receive $125,000Read the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, NY – U.S. Attorney James P. Kennedy, Jr. announced today that the Niagara Falls Police Department has been awarded $2,313,738 through the Justice Department’s Office of Community Oriented Policing Services (COPS Office) COPS Hiring Program (CHP). The funding will be used to hire eight additional police officers. In addition, Chemung County will receive $125,000 in COPS funding.
“This is a critical time for the Niagara Falls Police Department,” stated U.S. Attorney Kennedy. “Shootings involving injury jumped 48%, and the number of victims jumped 70%, from 2018 to 2019, and at the same time, the department is understaffed. This grant will allow Niagara Falls to add an additional eight officers to the force to fight violent crime, and without question, these resources will assist Superintendent Licata in his continuing effort to make the streets of Niagara Falls safer for its citizens.”
“The Department of Justice is committed to providing the police chiefs and sheriffs of our great nation with needed resources, tools, and support. The funding announced today will bolster their ranks and contribute to expanding community policing efforts nationwide,” said Attorney General William P. Barr. “A law enforcement agency’s most valuable assets are the men and women who put their lives on the line every day in the name of protecting and serving their communities.”
The Attorney General announced $400,000,000 in funding awards to 596 law enforcement agencies across the nation, which allows those agencies to hire 2,732 additional full-time law enforcement professionals.
The COPS Hiring Program is a competitive award program intended to reduce crime and advance public safety through community policing by providing direct funding for the hiring of career law enforcement officers. In addition to providing financial support for hiring, CHP provides funding to state, local, and tribal law enforcement to enhance local community policing strategies and tactics. In a changing economic climate, CHP funding helps law enforcement agencies maintain sufficient sworn personnel levels to promote safe communities. Funding through this program had been on hold since the spring of 2018 due to a nationwide injunction that was lifted earlier this year.
CHP applicants were required to identify a specific crime and disorder problem focus area and explain how the funding will be used to implement community policing approaches to that problem focus area. 43 percent of the awards announced today will focus on violent crime, while the remainder of the awards will focus on a variety of issues including school-based policing to fund school resource officer positions, building trust and respect, and opioid education, prevention, and intervention. The COPS Office received nearly 1,100 applications requesting more than 4,000 law enforcement positions.
To learn more about CHP, please visit https://cops.usdoj.gov/chp. For additional information about the COPS Office, please visit www.cops.usdoj.gov.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
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New York Man Pleads Guilty to Drug Charges following Safe Streets Task Force Investigation of South Side Pittsburgh GangRead the Press Release
PITTSBURGH, PA – A former resident of the Bronx borough of New York City pleaded guilty in federal court to charges related to drug trafficking in connection with a large-scale investigation conducted by the Greater Pittsburgh Safe Streets Task Force, United States Attorney Scott W. Brady announced today.
Holiday Vaughn, 35, pleaded guilty to one count of conspiracy to distribute or possess with intent to distribute heroin and fentanyl, and one count of possession of heroin and fentanyl, before United States District Judge William S. Stickman IV. Mr. Vaughn is one of 36 defendants charged in the Indictment.
In connection with the guilty plea, the court was advised that 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.
The court was further advised that Mr. Vaughn was a supplier of heroin and fentanyl to the drug trafficking organization, and that law enforcement officials intercepted conversations between Vaughn and his co-conspirator, Christopher Highsmith, discussing drug transactions. Additionally, law enforcement recovered 23 grams of fentanyl and heroin during a traffic stop on May 29, 2019, when the defendant was traveling to Pittsburgh from New York. In connection with his guilty plea, Vaughn accepted responsibility for the distributing or possessing with intent to distribute 39 grams of heroin and fentanyl in the Pittsburgh area.
Judge Stickman scheduled sentencing for October 8, 2020 at 10:30 am. The law provides for a total sentence of not more than 20 years in prison, a fine of up to $1,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of each defendant. Vaughn remains detained pending sentencing.
Assistant United States Attorney Christy C. Wiegand is prosecuting 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.
New Haven Man Sentenced to Prison for Trafficking HeroinRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that JERMAINE FOSTER, 49, of New Haven, was sentenced today by U.S. District Judge Janet C. Hall to 20 months of imprisonment, followed by three years of supervised release, for trafficking heroin.
Pursuant to the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), the sentencing occurred via videoconference.
According to court documents and statements made in court, this matter stems from a joint investigation headed by the DEA New Haven Task Force and the Waterbury and Naugatuck Police Departments into a heroin and cocaine trafficking operation headed by Keith Jordan of Waterbury. The investigation, which included the use of court-authorized wiretaps, physical surveillance and controlled purchases of narcotics, revealed that Jordan was receiving large quantities of heroin from various suppliers, including Brian Hanna, of Brooklyn, New York; Pedro Santos, of Waterbury, and Domingo Alves, of Waterbury, and selling to drug to other distributors and street-level customers. Jordan also purchased and distributed cocaine.
During the investigation, a wiretap identified Larry Hall, of Naugatuck, as Santos’ heroin supplier. Foster was intercepted on the wiretap purchasing bulk quantities of heroin that he sold at a profit to street-level dealers.
On March 13, 2019, a grand jury in Hartford returned an indictment charging Foster, Jordan, Hanna, Santos, Hall and 24 other individuals with various offenses related to the distribution of heroin, fentanyl, cocaine and crack cocaine.
Foster and several codefendants were arrested on March 20, 2019. In association with the arrests, investigators seized approximately 3,000 bags of heroin, 400 grams of cocaine, 350 grams of fentanyl/heroin mixed, 400 grams of heroin, 10 grams of crack, 20 pounds of marijuana, fentanyl patches, a one-kilogram press, four handguns, approximately $120,000 in cash and four vehicles.
On November 6, 2019, Foster pleaded guilty to one count of conspiracy to distribute, and to possess with intent to distribute, 100 grams or more of heroin.
Foster, who is released on a $150,000 bond, is required to report to prison on October 14, 2020.
Jordan, Hanna, Santos and Hall pleaded guilty to related charges and await sentencing.
This investigation has been conducted by the Drug Enforcement Administration New Haven Task Force, Waterbury Police Department and Naugatuck Police Department, with the critical assistance of the U.S. Secret Service, New York Field Office. The DEA New Haven Task Force includes participants from the U.S. Marshals Service, Internal Revenue Service – Criminal Investigation Division, and the New Haven, Hamden, West Haven, North Haven, Branford, Ansonia, Meriden, Derby, Middletown, Naugatuck and Waterbury Police Departments.
The case is being prosecuted by Assistant U.S. Attorneys S. Dave Vatti and Nathaniel J. Gentile.
Nebraska Man Admits Stealing and Selling His Employer’s Confidential InformationRead the Press Release
NEWARK, N.J. – A Nebraska man today admitted engaging in fraudulent activity that exposed his employer’s confidential information, U.S. Attorney Craig Carpenito announced.
Timothy Young, 50, of Moorefield, Nebraska, pleaded guilty by videoconference before U.S. District Judge Katharine S. Hayden in Newark federal court to an information charging him with wire fraud.
According to documents filed in the case and statements made in court:
Young was employed at a data analytics and risk assessment firm based in New Jersey. The company serves customers worldwide, including entities providing insurance and financial services as well as government entities. The company maintains a network that houses, among other things, significant amounts of personally identifiable information.
Without the firm’s approval, Young obtained confidential, non-public information that belonged to the firm. The information included names, logon names, passwords, email addresses, and telephone numbers for some of the company’s clients. Young then attempted to sell the information.
The charge of wire fraud is punishable by a maximum potential penalty of 20 years in prison and a fine of the greater of $250,000, twice the gross profits to Young or twice the gross loss suffered by the victim.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Acting Special Agent in Charge Douglas Korneski in Newark, and task force officers from the N.J. State Police, Jersey City Police Department, Ocean City Police Department, and Federal Protective Service, with the investigation leading to today’s guilty plea. He also thanked the FBI’s Omaha Division, under the direction of Special Agent in Charge Kristi Koons Johnson, for its role in the investigation.
The government is represented by Assistant U.S. Attorney Andrew Kogan of the U.S. Attorney’s Office Cybercrime Unit in Newark.
Mississippi Department of Health Services Agrees to Pay $5 Million to Resolve False Claims Act Liability in Connection with SNAP Quality ControlRead the Press Release
The Mississippi Department of Health Services (MDHS) has agreed to pay the United States $5 million to resolve allegations that it violated the False Claims Act in its administration of the U.S. Department of Agriculture’s (USDA) Supplemental Nutrition Assistance Program (SNAP), the Department of Justice announced today. Until 2008, SNAP was known as the Food Stamp Program.
“SNAP is an important vehicle for helping families in need,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division. “This settlement is another example of the Department’s commitment to protecting taxpayer funds and the vital programs that they support.”
“Although it is appalling that these actions occurred within a state agency entrusted with assisting vulnerable and needy residents, I am heartened that MDHS has resolved its liability and cooperated with our investigation,” said U.S. Attorney William D. Hyslop for the Eastern District of Washington. “Together with our partners in the Justice Department’s Civil Division and the USDA, we will continue to investigate and hold accountable those who misuse and wrongfully obtain SNAP funding.”
“We appreciate the commitment and investigative assistance provided by our partners at the Department of Justice’s Civil Division and the U.S. Attorney’s Office throughout this multi-state investigation,” said Special Agent in Charge Bethanne M. Dinkins of the USDA Office of Inspector General (OIG). “We also wish to note the technical assistance provided by our colleagues in the Office of Audit at OIG. During the investigation, conducted by OIG’s Northeast Regional Office, we worked together to address the concerns of employees of multiple states and others who alleged that the integrity of the SNAP quality control process was weakened by third-party consultants. These concerned individuals reported that cases were not being treated in a consistent manner, and that certain advice from consultants resulted in identified errors being diminished rather than used to improve eligibility determinations. The settlements reached to date send a strong message regarding the government’s commitment to work across agency lines to protect the integrity of SNAP.”
Under SNAP, USDA provides eligible low-income individuals and families with financial assistance to buy nutritious food. Since 2010, SNAP has served on average more than 45 million Americans per month, and provided more than $71 billion annually.
Although the federal government funds SNAP benefits, it relies on the states to determine whether applicants are eligible for benefits, to administer those benefits, and to perform quality control to ensure that eligibility decisions are accurate. The USDA requires that the states’ quality control processes ensure that benefits are correctly awarded, are free from bias, and accurately report states’ error rates in making eligibility decisions.
The USDA reimburses states for a portion of their administrative expenses in administering SNAP, including expenses for providing quality control. It also pays performance bonuses to states that report the lowest and the most improved error rates each year, and can impose monetary sanctions on states with high error rates that do not show improvement.
The settlement resolves allegations that beginning in 2012, MDHS contracted with a consultant known as Julie Osnes Consulting, LLC (Osnes Consulting) to provide advice and recommendations designed to lower its SNAP quality control error rate. The United States alleged that Osnes Consulting’s recommendations, as implemented by MDHS, injected bias into MDHS’s quality control process and resulted in MDHS submitting false quality control data and information to USDA, for which it received undeserved performance bonuses for fiscal years 2012 and 2013.
This is the seventh settlement in this matter, and the sixth settlement with a state agency for manipulating its SNAP quality control findings. The United States has reached previous settlements with state agencies in Virginia, Wisconsin, Texas, Louisiana, and Alaska, as well as with Osnes Consulting and its owner, Julie Osnes. Including this settlement, the United States has now recovered over $41 million in connection with this investigation.
The settlement was the result of a joint investigation conducted by the USDA-OIG, the U.S. Attorney’s Office for the Eastern District of Washington, and the Department of Justice’s Civil Division, Commercial Litigation Branch. The investigation arose out of a nationwide audit of SNAP Quality Control processes by the USDA-OIG. The claims resolved by the civil settlement are allegations only and there has been no determination of liability.
Middlesex County Man Arrested for Attempting to Set Fire to Trenton Police VehicleRead the Press Release
TRENTON, N.J. – A Middlesex County, New Jersey, man was arrested today for attempting to set fire to a marked police vehicle in Trenton after a demonstration over the death of George Floyd in Minneapolis, Minnesota, U.S. Attorney Craig Carpenito announced.
Justin Spry, 21, of South Plainfield, New Jersey, was arrested by special agents of the FBI and is charged by complaint with one count of attempting to damage or destroy by fire a vehicle owned or possessed by an institution receiving federal financial assistance, and one count of attempting to damage or destroy by fire a vehicle used in and affecting interstate commerce. Spry will make his initial appearance June 3, 2020, by videoconference before U.S. Magistrate Judge Tonianne J. Bongiovanni.
“The conduct described in the criminal complaint demonstrates a deliberate effort to destroy a police vehicle during a demonstration,” U.S. Attorney Carpenito said. “Our office will not hesitate to bring to justice anyone who engages in this kind of destruction. We will work with our law enforcement partners to find these violent perpetrators and charge them appropriately.”
According to the complaint:
On May 31, 2020, large-scale protests were held throughout the United States, including in Trenton, in response to the death of Floyd on May 25, 2020, while in the custody of the Minneapolis Police Department. Although the May 31 protest in Trenton began peacefully, violence erupted later in the day. A group of individuals proceeded along East State Street in downtown Trenton and began to smash store fronts, loot businesses, and attack marked Trenton Police Department vehicles parked along East State Street.
A street camera recorded Spry and another individual attempt to stuff a piece of cloth into the gas tank of a marked police vehicle and ignite it. Law enforcement officers on scene observed Spry as he attempted to ignite the vehicle. Spry noticed the officers and attempted to flee, but was arrested.
Both counts charged in the criminal complaint carry a statutory mandatory minimum term of imprisonment of five years, a maximum potential penalty of 20 years in prison, and a maximum fine of $250,000.
U.S. Attorney Carpenito credited special agents of the FBI and task force officers of the Joint Terrorism Task Force in Newark, as well as special agents of the FBI’s Trenton Resident Agency, under the direction of Acting Special Agent in Charge Douglas Korneski, with the investigation leading to today’s arrest. He also thanked officers of the Trenton Police Department, under the direction of Police Director Sheilah Coley; troopers of the New Jersey State Police, under the direction of Colonel Patrick J. Callahan; and officers of the New Jersey Department of Corrections, under the direction of Commissioner Marcus O. Hicks, for their assistance.
The government is represented by Assistant U.S. Attorneys Alexander E. Ramey and Michelle Gasparian of the U.S. Attorney’s Office’s Criminal Division in Trenton.
The charges and allegations contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Methamphetamine Trafficker Is Sentenced to 14 Years in PrisonRead the Press Release
ASHEVILLE, N.C. – U.S. Attorney Andrew Murray announced today that Matthew Dean Lail, 35, of Valdese, N.C., was sentenced to 168 months in prison and five years of supervised release on federal drug charges. U.S. District Judge Max O. Cogburn Jr. presided over the sentencing.
According to information in filed court documents and today’s sentencing hearing, in June 2018, Lail was on supervised release on state criminal charges. On June 28, 2018, a probation officer with the North Carolina Division of Adult Correction and Juvenile Justice, accompanied by a deputy with the Burke County Sheriff’s Office, arrested Lail at his residence in Valdese, on outstanding warrants for probation violations. Law enforcement conducted a subsequent search of the residence and recovered more than 110 grams of methamphetamine, drug paraphernalia, a firearm and ammunition, and $426 in drug proceeds.
On October 28, 2019, Lail pleaded guilty to possession with intent to distribute methamphetamine. Lail is currently in federal custody and will be transferred to custody of the federal Bureau of Prisons upon designation of a federal facility. Federal sentences are served without the possibility of parole.
In making today’s announcement, U.S. Attorney Murray thanked U.S. Bureau of Alcohol, Tobacco, Firearms & Explosives, the North Carolina Division of Adult Correction and Juvenile Justice and the Burke County Sheriff’s Office for their coordination and partnerships throughout the investigation and prosecution of this case.
Assistant United States Attorney John Pritchard, of the U.S. Attorney’s Office in Asheville, prosecuted the case.
Meds2Go Express Pharmacy, Inc. Sentenced for Role in Drug Diversion SchemeRead the Press Release
Pharmacy Shut Down and Ordered to Pay $250,000 in Community Restitution and Forfeiture
CHARLESTON, W.Va. – Meds2Go Express Pharmacy, Inc. (Meds2Go), a pharmacy located in Alum Creek in Lincoln County, was sentenced for money laundering, announced United States Attorney Mike Stuart. The money laundering conviction arose out of a conspiracy between the pharmacy and Hope Clinic, a pain clinic operating as a pill mill, to dispense compound opioids for no legitimate medical purpose and outside the bounds of professional medical practice. As part of the plea agreement in December 2019, Meds2Go was shut down and has now been ordered to pay $250,000 toward community restitution and forfeiture. The community restitution will be paid for the costs associated with drug abuse treatment in West Virginia to redress the harm caused by illicit opioid usage stemming from the sale of prescription opioids. The West Virginia Crime Victim's Compensation Fund will receive 65% of the community restitution amount, and 35% will be paid to West Virginia Department of Health and Human Resources, Bureau of Behavioral Health and Health Facilities.
“Meds2Go betrayed the trust of the communities it served and our citizens. The pharmacy put profits above safety and aided the growth of the opioid crisis in West Virginia,” United States Attorney Mike Stuart said. “We have taken on the opiate crisis and we are making tremendous progress. We will continue to hold those that place greed above their solemn obligation to serve the best health of our citizens.”
Meds2Go previously admitted that in 2014 and 2015 it filled prescriptions written by physicians employed by Hope Clinic, despite its knowledge that there was no legitimate medical purpose for the prescriptions and that they were prescribed outside the usual course of medical practice. In order to maximize corporate profits, the pharmacy ignored numerous red flags that should have prevented them from dispensing the prescription medications written by Hope Clinic, such as: (1) an abnormally high amount of prescriptions for widely-abused, highly-addictive controlled substances such as oxycodone; (2) prescribed controlled substances to patients for long periods of time; (3) permitted refills before prior prescriptions should have run out; (4) ignored obvious signs that patients were drug addicts; (5) patients travelled long distances and from out of state; (6) multiple Hope Clinic physicians issued prescriptions to the same patient; (7) numerous family members who were all patients of Hope Clinic, came to the pharmacy at the same time; (8) insurance companies refused to pay for prescriptions from Hope Clinic; and (9) cash-only transactions.
Meds2Go further admitted that it engaged in illegal manufacturing of its own supply of oxycodone and methadone due to supply and demand by compounding pills in mass quantities at its locations in Alum Creek and Charleston. Due to the excessive amount of prescriptions for controlled substances written by Hope Clinic, the pharmacy could not obtain enough of a supply of oxycodone and methadone from its distributors. In order to keep up with the demand, the pharmacy bypassed purchase restrictions from the distributor by setting up and purchasing compounding equipment, training its employees to compound pills on a mass scale, purchasing powders and other raw materials, and manufacturing pills containing oxycodone and methadone. The compounded pills were then sold to cash-paying customers who had prescriptions written by Hope Clinic. The pharmacy used the proceeds from the illegal manufacturing and dispensing to carry on the operations of business.
United States District Judge Irene C. Berger imposed the sentence. The investigation was conducted by the U.S. Food and Drug Administration – Office of Inspector General (OIG) and the U.S. Department of Health and Human Services – Office of Inspector General (OIG). Assistant United States Attorneys Andrew Tessman and Steven I. Loew handled the prosecution.
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Man admits to “spoof” email fraud scheme and moreRead the Press Release
HOUSTON – A 64-year-old man has admitted to conspiring to commit money laundering for his role in a complex email fraud scheme, announced U.S. Attorney Ryan K. Patrick.
Kenenty Kim aka Myung Kim engaged in a business email compromise scheme using “spoof” email addresses which have similar names to legitimate email accounts that Kim hacked. He would then use the addresses to create fictitious transactions or to hijack legitimate transactions to convince a victim company or individual to send funds to a bank account Kim actually controlled.
For example, Kim created a spoof email account for a Pinehurst-based construction company. He then used that account to convince another company, based in Huntsville, to send over $200,000 to them. In reality, the account where they sent the funds was actually an account Kim controlled. He then took that money and moved it through several different bank accounts before placing it in an offshore account.
Kim also engaged in the same conduct against the parent company of several major appliance companies. Kim created a spoof account of one of its vendors and used it to convince the company to send more than $300,000 to what it thought was a vendor. The account was actually set up for a different shell company Kim created with a similar name. Again, Kim took that money and eventually placed it in an offshore account.
At a previous hearing, the court also heard about Kim’s numerous credit card fraud schemes. In those, Kim created a system to process credit card payments. He would then obtain a victim’s personal identifying information and charge over $10,000 on their credit cards. Kim also had 36 different credit cards in a variety of names, four different Social Security numbers, two dates of birth, 11 different overlapping addresses and a prior real estate license suspension for engaging in fraud.
In his plea agreement, Kim acknowledged he gained over $700,000 from his various fraud schemes.
U.S. District Judge George C. Hanks accepted the plea today and has set sentencing for Aug. 19. At that time, Kim, of Firecrest, Washington, faces up to 20 years in federal prison and a possible $500,000 fine or twice the amount he intended to obtain as a result of the criminal offense.
Kim has been and will remain in custody pending sentencing.
The FBI conducted the investigation. Assistant U.S. Attorney Adam Laurence Goldman is prosecuting the case.
Man Who Brandished Assault Rifle at Protest Charged with Making ThreatsRead the Press Release
A man who brandished an assault rifle at a Black Lives Matter protest in Lubbock on Saturday has been charged with making interstate threats, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.
According to a criminal complaint unsealed today, Emmanuel Quinones, a 25-year-old local, allegedly brought a loaded Smith & Wesson .223 caliber semi-automatic to a protest decrying the death of George Floyd, a black man who died at the hands of Minneapolis police last month.
In view of the protesters, Mr. Quinones held the rifle at “low ready,” in firing position with the muzzle pointed toward the ground, as panic rippled through the assembled crowd. (Although Texas is an open-carry state, the Texas Penal Code makes it illegal to display a firearm in a public place “in a manner calculated to alarm.”)
Mr. Quinones allegedly refused a Lubbock Police officer’s verbal commands to drop the rifle, and only did so when the officer drew his gun. A protester then tackled Mr. Quinones, who allegedly shouted, “this is a revolution” and “President Trump must die” as he was taken into custody.
During an interview, Mr. Quinones admitted that he previously made social media posts designed to “intimidate” the President and “MAGA instigators.” One such post, shared on Facebook on May 28, intimated that he planned to obtain gun parts “to off racists and MAGA people.”
In the interview, the defendant stated he attended the protest to protect demonstrators from these so-called MAGA (Make America Great Again) instigators, who he planned to shoot on sight. He claimed the police would not have been able to identify these counter-protestors, but that he could have.
“Instead of respecting citizens’ rights to respectfully voice their feelings, this defendant incited panic, putting everyone present – including those he claimed to support – in danger,” said U.S. Attorney Erin Nealy Cox. “We will not tolerate attempts to instill terror or encourage violence at otherwise peaceful protests.”
“The FBI respects the rights of individuals to peacefully exercise their First Amendment rights. In this case, the defendant threatened multiple lives including the President of the United States and that will not be tolerated,” said FBI Dallas Special Agent in Charge Matthew J. DeSarno. “We will continue working with our local, state, and federal partners to apprehend and charge violent instigators who are exploiting legitimate, peaceful protests and engaging in violations of federal law.”
A criminal complaint is merely an allegation of unlawful conduct, not evidence. Mr. Quinones is presumed innocent unless and until proven guilty in a court of law.
He made his initial appearance Tuesday afternoon before U.S. Magistrate Judge D. Gordon Bryant. If convicted, the defendant could face up to five years in federal prison.
The Federal Bureau of Investigation Dallas Field Office, Lubbock Resident Agency, the United States Secret Service, the United States Bureau of Alcohol, Tobacco, Firearms, & Explosives, and the Lubbock Police Department conducted the investigation. Assistant U.S. Attorney Jeff Haag is prosecuting the case.
Ludington Man Pleads Guilty to Stealing from the Lake Michigan Carferry and Filing False Tax ReturnsRead the Press Release
Paul Patrick Piper stole between $550,000.00 and $3,500,000.00 from Lake Michigan Carferry and failed to pay federal income taxes of $363,000
GRAND RAPIDS, MICHIGAN — Paul Patrick Piper, 58, of Ludington, Michigan, pled guilty today to a felony information dated February 21, 2020, setting forth criminal charges of bank fraud and federal income tax offenses. Piper’s guilty plea hearing took place in the United States District Court in Grand Rapids, Michigan, before Chief U.S. District Judge Robert J. Jonker.
According to the felony information and plea agreement, Piper served for many years as the financial controller for Lake Michigan Carferry, the company operating the SS Badger ferry between Ludington, Michigan, and Manitowoc, Wisconsin. Piper defrauded various financial institutions and Lake Michigan Carferry in an amount between $550,000.00 and $3,500,000.00, by overriding normal accounting systems and writing checks directly to himself and to two of his affiliated businesses, Piper Tax & Accounting and Piper Group. Piper either forged the signatures of company owners on these checks or used a signature stamp without the authorization of the owners. Piper hid these transactions in the accounting system by booking these checks to an insurance expense code and by otherwise making false entries to balance company accounts. Additionally, Piper filed false personal income tax returns with the Internal Revenue Service because he knowingly failed to include the income he stole from the Carferry, and other income earned from his tax business, on his federal income tax returns. As part of his plea agreement, Piper agrees to pay to the IRS $363,926.00 in past-due taxes, plus penalties and interest.
A sentencing hearing in the United States District Court in Grand Rapids, Michigan, has been scheduled for August 11, 2020, at 3 p.m. before Chief U.S. District Judge Robert J. Jonker. At that time, Piper faces a maximum term of imprisonment of 30 years for the bank fraud offense and a maximum term of imprisonment of 3 years for filing a false tax return. Piper will also be ordered to pay restitution to his victims and to forfeit certain assets obtained with the proceeds of his criminal offenses. Piper previously forfeited a 2018 Ram Truck, a 2008 Glacier Bay 5th Wheel Recreational Vehicle, and cash in lieu of forfeiture of other assets.
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Louisiana U.S. Attorneys Working with Federal, State, and Local Law Enforcement Partners to Ensure Peaceful ProtestsRead the Press Release
United States Attorneys Brandon J. Fremin, Middle District of Louisiana, David C. Joseph, Western District of Louisiana, and Peter G. Strasser, Eastern District of Louisiana, jointly announced that the U.S. Attorney’s Offices in Louisiana are joining federal, state, and local law enforcement agencies in their efforts to preserve Louisiana citizens’ rights to free speech and assembly while protecting our communities from violence and destruction.
In a statement on Sunday, May 31, U.S. Attorney General William P. Barr noted that federal law enforcement resources would be available to assist state and local leaders in their efforts to ensure peaceful protests and to reestablish law and order. Attorney General Barr said that federal resources will be directed at apprehending and charging the violent radical agitators who have taken over peaceful protests and are engaging in violations of federal law.
According to U.S. Attorneys Fremin, Joseph, and Strasser, joint federal, state, and local coordination is designed to use available federal assets to assist state and local partners in maintaining order and allowing people to peacefully assemble, while protecting against violence and destruction.
Specifically, the U.S. Attorney’s Offices are also working with the Federal Bureau of Investigation (FBI) Joint Terrorism Task Force (JTTF) to identify criminal organizers and instigators, and seek federal prosecutions where applicable. The FBI’s JTTFs are the nation’s front line of defense against terrorism, both international and domestic. Today there are about 200 task forces around the country, including one in the FBI’s New Orleans field office, which supports the state of Louisiana through its local FBI branch offices in Baton Rouge, Shreveport, Lafayette, Alexandria, Lake Charles, and Monroe. The New Orleans JTTF includes state, local and federal agencies.
The tragic events leading to Mr. Floyd’s death in Minnesota are being addressed through our criminal justice system, which is moving quickly. The Minnesota state prosecutor has brought charges against a former Minneapolis police officer and the Department of Justice is also conducting an independent investigation.
“Our Constitutional right to peacefully protest is a time-honored bedrock principle upon which our great nation was founded, and it should be protected,” said U.S. Attorney Fremin. “Also to be protected is innocent life and property often injured by criminals who hijack otherwise peaceful demonstrations in favor of advancing an alternative agenda.” Fremin added, “In recent days, we have seen peaceful demonstrations by well-meaning Louisianans. We appreciate their respect for the rule of law and we support their right to assemble, but make no mistake – criminal behavior will not be tolerated. The responsibility of law enforcement at every level is to maintain law and order in our communities, and we are working around the clock with local, state and federal officials to do just that.”
“The demonstrations in Louisiana have been peaceful and I applaud Louisianians for exercising their First Amendment rights in a non-violent manner,” said U.S. Attorney David C. Joseph. “However, if anyone uses these peaceful demonstrations to promote violence or property destruction, prosecutors in my office stand ready to use all available resources to assist our federal, state, and local law enforcement partners to enforce the law and protect our communities from acts of violence and lawlessness.”
“Our office remains dedicated to protecting our citizens and upholding their Constitutional rights,” said U.S. Attorney Strasser. “The First Amendment gives every citizen the right to assemble and protest peacefully. Nevertheless, when a few people instigate violence and damage property, we must and will enforce the law. Violence and chaos that disrupts our precious First Amendment Constitutional right shall not be tolerated. Through the collaborative efforts of our local, state, federal and community partners, we will continue both to ensure our citizen’s lawful right of self-expression and work with our first responders to maintain civility.”
Attorney General Barr’s statement is available here: https://www.justice.gov/opa/pr/attorney-general-william-p-barrs-statement-riots-and-domestic-terrorism.
For more information on the FBI’s Joint Terrorism Task Forces, or JTTFs, go to: https://www.fbi.gov/investigate/terrorism/joint-terrorism-task-forces.
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
London Man Sentenced to 180 Months for Methamphetamine TraffickingRead the Press Release
LONDON, Ky.- A London, Ky., man, Ronnie Bowling, 56, was sentenced in federal court on Tuesday to 180 months in prison, by U.S. District Judge Claria Horn Boom, after previously pleading guilty to possession with intention to distribute 500 grams or more of methamphetamine.
According to Bowling’s plea agreement, between February 20, 2019 and February 22, 2019, Bowling engaged in multiple conversations with a distributor, in which they arranged for Bowling to obtain two pounds of methamphetamine. Bowling admitted meeting the distributor at a prearranged meeting location with $15,476.00 in cash to purchase more than 500 grams of methamphetamine that he intended to distribute in the Eastern District of Kentucky.
Bowling pleaded guilty in January 2020.
Under federal law, Bowling must serve 85 percent of his prison sentence and will be under the supervision of the U.S. Probation Office for 10 years.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Jeffrey Todd Scott, Special Agent in Charge, DEA Louisville Field Division; and Sheriff John Root, Laurel County Sheriff’s Department jointly made the announcement.
The investigation was directed by the DEA and Laurel County Sheriff’s Department. The United States was represented by Assistant U.S. Attorney Andrew Trimble.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
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Leader of South Baltimore Drug Shop Sentenced to More Than Five Years in Federal Prison for Crack Cocaine Distribution ConspiracyRead the Press Release
Baltimore, Maryland – U.S. District Judge George L. Russell, III, today sentenced Ceasar Vaughan, age 27, of Baltimore, to 63 months in federal prison, followed by three years of supervised release, for conspiracy to distribute and for possession with intent to distribute crack cocaine.
The sentence was announced by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge Timothy Jones of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) Baltimore Field Division; and Commissioner Michael Harrison of the Baltimore Police Department.
United States Attorney Robert K. Hur stated, “We are committed to working with our law enforcement partners to get guns out of the hands of drug dealers and off of our streets, in order to reduce violent crime in our neighborhoods. If you use a gun, you could face federal time, where there is no parole—ever. Please, put down the guns and save a life—maybe even your own.”
According to Vaughan’s plea agreement, from February to August 2019, Vaughan was one of the leaders of a conspiracy to distribute cocaine base through a drug shop that operated in the 400 block of Furrow Street in South Baltimore. The members of the conspiracy affiliated themselves with the name, “Never Stop Grinding” or “NSG.”
Vaughan and his co-conspirators either sold narcotics directly to customers or assisted each other in the transactions. Vaughan was a leader of the drug shop. During the investigation, between April 24, 2019 and June 20, 2019, Vaughan participated in at least eight sales of crack cocaine during which Vaughan sold crack cocaine himself, corralled other drug shop members to complete sales, entered the stash house to get drugs to facilitate sales, or ordered others to complete sales.
Members of the drug shop also possessed firearms. In music videos posted online, co-conspirators are seen possessing what appear to be firearms, displaying them in their waistbands or pointing them directly at the camera. Several people in the videos are seen wearing “Never Stop Grinding” or “NSG” clothing or jewelry. In addition, on April 1, 2019, members of the Baltimore Police Department arrested a juvenile member of the drug shop with a loaded firearm on the 400 block of Furrow Street, where the drug shop operated. A co-conspirator was with the juvenile at the time of the arrest. During a search warrant executed at the residence of a co-conspirator on August 7, 2019, investigators found a loaded firearm and more than 70 rounds of ammunition.
Vaughan agrees that he conspired to distribute and possess with the intent to distribute 28 grams or more of crack cocaine with his co-conspirators. He further agrees that he was a leader of the conspiracy and that it was reasonably foreseeable that he and the other members of the conspiracy would distribute over 28 grams or more of cocaine base between February 2019 and August 2019.
United States Attorney Robert K. Hur praised the ATF and the Baltimore Police Department for their work in the investigation. Mr. Hur thanked Assistant U.S. Attorneys Brandon Moore and Clinton Fuchs, who prosecuted the case.
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Justice Department Reaches Agreement with Iowa City Community School District, Iowa, to Ensure Accessible PlaygroundsRead the Press Release
The Justice Department today announced that it reached a settlement agreement with the Iowa City Community School District (School District), Iowa, under the Americans with Disabilities Act (ADA). The agreement resolves a complaint filed by parents of children with disabilities alleging that playgrounds in the school district are not accessible to children who use wheelchairs or other mobility devices. Based on the complaint, the Justice Department surveyed playgrounds at twelve school district elementary schools and identified elements of those playgrounds that did not meet the applicable ADA Standards for Accessible Design.
Under the agreement, the school district will ensure that its playgrounds comply with Title II of the ADA and the 2010 ADA Standards for Accessible Design. The school district will remedy violations related to play components; play area amenities, such as benches and picnic tables; accessible routes to play areas; and routes connecting play components.
“Nearly thirty years after passage of the Americans with Disabilities Act, no child with a disability should be prevented from accessing a playground because it has been constructed in violation of the ADA,” said Assistant Attorney General Eric Dreiband of the Civil Rights Division. “This settlement agreement will ensure that children with disabilities can access their school’s playground and play alongside their classmates. We commend the Iowa City Community School District for its ongoing cooperation with this matter, as well as the significant steps it has already taken to ensure that its playgrounds are accessible.”
2020 marks the ADA’s 30th anniversary. The Justice Department continues to advance the nation's goal of equal opportunity, integration, full participation, inclusion, independent living, and economic self-sufficiency for people with disabilities. Through its enforcement and technical assistance tools, the Justice Department strives to eliminate unlawful discrimination against individuals with disabilities.
To read the settlement agreement, please click http://www.ada.gov/iccsd_sa.html. For more information on the Civil Rights Division, please visit www.justice.gov/crt. For more information about the ADA, please call the Justice Department’s toll-free ADA information line at 800-514-0301 (TDD 800-514-0383) or visit www.ada.gov.
Joplin Man Sentenced to 25 Years for Meth ConspiracyRead the Press Release
SPRINGFIELD, Mo. – A Joplin, Missouri, man was sentenced in federal court today for his role in a conspiracy to distribute methamphetamine in Jasper County, Missouri.
Kevin L. Kivett Sr., 59, was sentenced by U.S. District Judge M. Douglas Harpool to 25 years in federal prison without parole.
On Oct. 1, 2019, Kivett pleaded guilty to participating in a conspiracy to distribute methamphetamine in Jasper County from March 8, 2016, through Oct. 3, 2017. Kivett also pleaded guilty to three counts of distributing methamphetamine and one count of possessing methamphetamine with the intent to distribute.
Kivett is the fourth defendant in this case to be sentenced. Co-defendant Melissa R. Kivett, 42, of Pomona, California, has pleaded guilty and awaits sentencing.
This case is being prosecuted by Supervisory Assistant U.S. Attorney Randall D. Eggert. It was investigated by the Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the FBI, the Missouri State Highway Patrol, the Illinois State Police, the Ozarks Drug Enforcement Team, the Jasper County, Mo., Sheriff’s Department, the Duquesne, Mo., Police Department, the Pomona, Calif., Police Department, and the Ontario, Calif., Police Department.OCDETF
This case is part of the Department of Justice’s Organized Crime and Drug Enforcement Task Force (OCDETF) program. The OCDETF program is the centerpiece of the Department of Justice’s drug supply reduction strategy. OCDETF was established in 1982 to conduct comprehensive, multilevel attacks on major drug trafficking and money laundering organizations. Today, OCDETF combines the resources and expertise of its member federal agencies in cooperation with state and local law enforcement. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking organizations, transnational criminal organizations, and money laundering organizations that present a significant threat to the public safety, economic, or national security of the United States.Jackson Man Sentenced to Almost Six Years in Prison under Project EJECT for Trafficking MethamphetamineRead the Press Release
Jackson, Miss – Corey Deonte Collins, 29, of Jackson, was sentenced today by U.S. District Court Judge Carlton W. Reeves to 70 months in prison, followed by 4 years of supervised release, for possessing with intent to distribute methamphetamine, announced U.S. Attorney Mike Hurst and Michelle A. Sutphin, Special Agent in Charge of the Federal Bureau of Investigation in Mississippi.
Collins was indicted following a drug trafficking investigation in the Jackson area. On February 19, 2019, and again on March 1, 2019, Collins sold approximately 26 grams of methamphetamine to an individual. Subsequent analysis by the Drug Enforcement Administration laboratory revealed the methamphetamine was 99% pure.
Subsequently, Collins pled guilty before Judge Reeves on March 2, 2020.
The Federal Bureau of Investigation investigated the case. It was prosecuted by Assistant United States Attorney Bert Carraway.
This case is part of Project EJECT, an initiative by the U.S. Attorney’s Office for the Southern District of Mississippi under the U.S. Department of Justice’s Project Safe Neighborhoods (PSN) and Project Guardian. EJECT is a holistic, multi-disciplinary approach to fighting and reducing violent crime through prosecution, prevention, re-entry and awareness. EJECT stands for “Empower Justice Expel Crime Together.” PSN is bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities.
Illinois Man Sentenced to over 17 Years in PrisonRead the Press Release
HAMMOND- Philip A. Rice, 44, of Dolton, Illinois was sentenced before U.S. District Court Judge Philip Simon upon his plea of guilty to production of child pornography, announced U.S. Attorney Kirsch.
Mr. Rice was sentenced to 210 months in prison followed by 5 years supervised release.
According to documents in the case, the defendant induced a minor female to engage in sexually explicit activity online via Facebook Messenger on multiple occasions when the female was between the ages of 10 to 12 years old. Law enforcement learned about the incident when a concerned citizen found the defendant’s abandoned mobile phone at a strip club in Indiana and reported it to police after finding disturbing images of child pornography on the device. Further forensic investigation revealed that the defendant possessed over 200 images of child pornography.
“Mr. Rice received a long prison sentence today for preying on children to satisfy his devious urges,” said U.S. Attorney Thomas L. Kirsch II. “We have always been very active in arresting and prosecuting those who commit crimes against children and this will continue.”
This case was investigated by Homeland Security Investigations and the Federal Bureau of Investigations with the assistance of the Indiana State Police and Lake Station Police. This case is being prosecuted by Assistant United States Attorneys Molly Kelley and Abizer Zanzi.
Guatemalan indicted for assaulting federal officerRead the Press Release
LAREDO, Texas – A 22-year-old citizen of Guatemala has been charged with forcibly assaulting a Border Patrol (BP) agent, announced U.S. Attorney Ryan K. Patrick.
A federal grand jury returned an indictment today against Josue Edilmar Ramirez-Pimentel. He is expected to appear for his arraignment next week before a U.S. magistrate judge in Laredo.
The criminal complaint alleges that on March 11, authorities responded to call that six people were attempting to make illegal entry into the United States near Richter’s Ranch in Laredo. As they attempted to apprehend the group, several individuals ran back towards the river, according to the allegations.
Ramirez-Pimentel, however, allegedly ran towards an agent. The agent then shined his flashlight at Ramirez-Pimentel and gave him commands in Spanish to stop and lay down, according to the charges. Ramirez-Pimentel allegedly did not comply and collided with the agent, causing him to hit his head on the ground.
Ramirez-Pimentel continued to struggle and struck the agent’s face with his forearm, according to the charges. The charges allege that as additional authorities arrived, they were eventually able to restrain and place Ramirez-Pimentel under arrest.
If convicted, Ramirez-Pimentel faces up to eight years in prison.
The FBI and Border Patrol conducted the investigation. Assistant U.S. Attorney Jennifer Day is 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.Guatemalan Man Sentenced to Prison for Illegally Reentering the United States After Being DeportedRead the Press Release
A man who illegally returned to the United States after being deported was sentenced today to almost three months in federal prison.
Orlando Quinonez-Revolorio, age 39, a citizen of Guatemala illegally present in the United States and residing in Waterloo, Iowa, received the prison term after a guilty plea today to one count of illegal reentry into the United States.
At the guilty plea portion of the hearing, Quinonez-Revolorio admitted he had previously been deported from the United States in August 2009 and illegally reentered the United States without the permission of the United States government. In November 2019, Quinonez-Revolorio’s illegal presence in the United States came to the attention of immigration agents following his arrest in Black Hawk County, Iowa, on state criminal charges.
Quinonez-Revolorio was then sentenced in Cedar Rapids by United States District Court Judge C.J. Williams. Quinonez-Revolorio was sentenced to 82 days’ imprisonment. He must also serve a one-year term of supervised release after the prison term. There is no parole in the federal system.
Quinonez-Revolorio is being held in the United States Marshal’s custody until he can be turned over to immigration officials.
The case was prosecuted by Assistant United States Attorney Daniel C. Tvedt and investigated by Department of Homeland Security, Immigration and Customs Enforcement, Enforcement and Removal Operations.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 20-CR-2015. Follow us on Twitter @USAO_NDIA.
Glens Falls Man Sentenced to 60 Months for Bank RobberyRead the Press Release
ALBANY, NEW YORK – Nelson L. Gouge, age 47, of Glens Falls, New York, was sentenced today to 60 months in prison for bank robbery.
The announcement was made by United States Attorney Grant C. Jaquith; Thomas F. Relford, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI); and Warren County Sheriff Jim LaFarr.
Gouge pled guilty on October 7, 2019 as his trial was set to begin. As part of his plea, Gouge admitted that on January 12, 2018, at approximately 1 p.m., he walked into the Trustco Bank branch on Route 9L in Lake George, New York, after attempting to conceal his face by use of a neck warmer. Gouge went to a line where a bank employee was standing, put a hard, black case on the counter and handed the employee a note that read, “I Have a weapon this is a robbery Just put all the money in the bag think about you and your employees + friends.” The bank employee did not have a drawer of money at her station, so she went to another station and took money out of the drawer. The employee turned back to her station where Gouge was holding a bag. The employee put money in the bag and Gouge left with $4,301.
The Warren County Sheriff’s Department quickly identified Gouge as a suspect and arrested him that night in South Glens Falls, New York.
U.S. District Judge Mae A. D’Agostino also sentenced Gouge to serve a 3-year term of supervised release, to begin after his term of imprisonment, and ordered Gouge to pay $2,587 in restitution, representing the amount of money not recovered by police.
This case was investigated by the Warren County Sheriff’s Department, New York State Police, Warren County District Attorney’s Office, and the FBI, and was prosecuted by Assistant U.S. Attorney Douglas Collyer.
Ft. Pierre Woman Sentenced for Federal Program TheftRead the Press Release
United States Attorney Ron Parsons announced that a Fort Pierre, South Dakota, woman convicted of Theft from a Program Receiving Federal Funds was sentenced on June 1, 2020, by Chief Judge Roberto A. Lange, U.S. District Court.
Pamela Duncan, age 53, was sentenced to 1 year of probation, restitution in the amount of $4,000, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Duncan was indicted by a federal grand jury on October 17, 2019. She pled guilty on February 27, 2020.
Between January 2017 and August 2018, in the District of South Dakota, while employed as an agent of the United Sioux Tribes of South Dakota Development Corporation (USTDC), Duncan, not the rightful owner, did embezzle, steal, obtain by fraud, and intentionally misapply property worth at least $5,000, from USTDC, an organization receiving Federal funds. Duncan removed property and applied funds for personal use, such as laptop computers, gym memberships, attorney services, payroll advances, and travel reimbursement.
This case was investigated by the U.S. Attorney’s Office and the Federal Bureau of Investigation. Assistant U.S. Attorney Michael J. Elmore prosecuted the case.
The case was brought as part of The Guardians Project, a federal law enforcement initiative to coordinate efforts between participating agencies, to promote citizen disclosure of public corruption, fraud, and embezzlement involving federal program funds, contracts, and grants, and to hold accountable those who are responsible for adversely affecting those living in South Dakota’s Indian country communities. The Guardians Project is another step of federal law enforcement’s on-going efforts to increase engagement, coordination, and positive action on behalf of tribal communities. Led by the U.S. Attorney’s Office, the participating agencies include: Federal Bureau of Investigation; the Offices of Inspector General for the Departments of Interior, Health and Human Services, Social Security Administration, Agriculture, Transportation, Education, Justice, and Housing and Urban Development; Internal Revenue Service, Criminal Investigation Division; U.S. Postal Inspector Service; U.S. Postal Service, Office of Inspector General.
For additional information about The Guardians Project, please contact the U.S. Attorney’s Office at (605) 330-4400. To report a suspected crime, please contact law enforcement at the federal agency’s locally listed telephone number.
Four agencies in the Western District of Texas received 2020 COPS Grants totalling over $6 million for 50 new positionsRead the Press Release
The Department of Justice today announced nearly $400 million in grant funding through the Department’s Office of Community Oriented Policing Services (COPS Office) COPS Hiring Program (CHP). The Attorney General announced funding awards to 596 law enforcement agencies across the nation, which allows those agencies to hire 2,732 additional full-time law enforcement professionals. The awards announced today are inclusive of the $51 million announced in May as part of Operation Relentless Pursuit.
“The Department of Justice is committed to providing the police chiefs and sheriffs of our great nation with needed resources, tools, and support. The funding announced today will bolster their ranks and contribute to expanding community policing efforts nationwide,” said Attorney General William P. Barr. “A law enforcement agency’s most valuable assets are the men and women who put their lives on the line every day in the name of protecting and serving their communities.”
The COPS Hiring Program is a competitive award program intended to reduce crime and advance public safety through community policing by providing direct funding for the hiring of career law enforcement officers. In addition to providing financial support for hiring, CHP provides funding to state, local, and tribal law enforcement to enhance local community policing strategies and tactics. In a changing economic climate, CHP funding helps law enforcement agencies maintain sufficient sworn personnel levels to promote safe communities. Funding through this program had been on hold since the spring of 2018 due to a nationwide injunction that was lifted earlier this year.
CHP applicants were required to identify a specific crime and disorder problem focus area and explain how the funding will be used to implement community policing approaches to that problem focus area. Forty-three percent of the awards announced today will focus on violent crime, while the remainder of the awards will focus on a variety of issues including school-based policing to fund school resource officer positions, building trust and respect, and opioid education, prevention, and intervention. The COPS Office received nearly 1,100 applications requesting more than 4,000 law enforcement positions.
The complete list of awards can be found here. To learn more about CHP, please visit https://cops.usdoj.gov/chp. For additional information about the COPS Office, please visit www.cops.usdoj.gov.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Former USPS Employee Admits Stealing Nearly $40,000 in Postal Money OrdersRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that KEITH SANFORD, 33, of Litchfield, pleaded guilty today before U.S. Magistrate Judge Donna F. Martinez to one count of theft of government property stemming from his embezzlement of nearly $40,000 in postal money orders while working for the U.S. Postal Service.
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, between July 2017 and December 2018, Sanford was employed by the U.S. Postal Service and worked on a rotating basis at the Granby, West Granby and East Hartland Post Offices. Between April and December 2018, Sanford issued 139 postal money orders totaling $39,937.02 to himself and, in certain instances, his associates, without remitting payment for them. Sanford received all of the proceeds from this scheme.
Sanford is scheduled to be sentenced by U.S. District Judge Vanessa L. Bryant on September 9, 2020, at which time he faces a maximum term of imprisonment of 10 years. He is released on a $25,000 bond pending sentencing.
This matter has been investigated by the U.S. Postal Service Office of Inspector General and is being prosecuted by Assistant U.S. Attorney Maria del Pilar Gonzalez.
Former Memphis Attorney Pleads Guilty to Scheme to Defraud ClientsRead the Press Release
Memphis, TN – Former Memphis attorney Michael Constantine Skouteris, age 50, entered a guilty plea to a charge of bank fraud in connection with a scheme to defraud clients. U.S. Attorney D. Michael Dunavant for the Western District of Tennessee announced the guilty plea today.
A federal grand jury returned an indictment against Skouteris in August 2019, alleging that between 2011 and January 2016, Skouteris engaged in a scheme to defraud his clients by settling cases without notifying his clients and forging their endorsements on the settlement checks made jointly payable to him and the client. The indictment alleged that Skouteris then deposited the checks to bank accounts he maintained at Suntrust Bank and First Tennessee Bank. According to the indictment, Skouteris fraudulently obtained in excess of $600,000 during the course of the scheme.
U.S. Attorney D. Michael Dunavant said, "Licensed attorneys who steal from their clients betray the trust of that fiduciary relationship, and are a threat to the public. This guilty plea holds Skouteris accountable for that breach of trust, and will hopefully achieve justice by recovering restitution for the victims and reminding the legal community of the high standards of their profession."
A sentencing hearing is currently set for September 24, 2020, before United States District Judge Mark S. Norris. Skouteris faces a maximum penalty of up to 30 years imprisonment, a fine of up to $1,000,000, and five years supervised release.
This case was investigated by the Federal Bureau of Investigation.
Assistant U.S. Attorney Carroll L. André III is prosecuting this case on behalf of the government.
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Former Harrison County Constable Convicted of Using a Minor to Produce Sexually Explicit Images and VideosRead the Press Release
LEXINGTON, Ky.- A Cynthiana, Kentucky, man was convicted on Tuesday, by a federal jury sitting in Lexington for using a minor to produce sexually-explicit images and videos.
After one hour of deliberation, following a day and half trial, the jury convicted 37-year-old William Michael Fields Jr., of two counts of employing, using, persuading, enticing, or coercing a minor to engage in sexually explicit conduct for the purpose of making a visual depiction of that conduct.
According to testimony at trial, Fields used a 17-year-old minor to produce sexually explicit images in the back of an ambulance in Bourbon County, on March 17, 2019. The evidence also revealed that the Defendant used the same minor to produce five videos and two images of sexually explicit conduct at the Emergency Medical Training Facility in Bourbon County, on March 23, 2019.
Fields, a former Harrison County Constable and Paris Fire Department firefighter, was indicted in October 2019.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Jerry C Templet Jr., Special Agent in Charge, Department of Homeland Security, U.S. Immigration and Customs Enforcement; Daniel J. Cameron, Kentucky Attorney General, and Chief E. Douglas Robinson, Cynthiana Police Department; and jointly announced the conviction.
The investigation was conducted by ICE and the Cynthiana Police Department with assistance from the Kentucky OAG Cyber Crimes Branch. The United States was represented in the case by Assistant U.S. Attorneys Erin Roth and Mary Melton.
Fields will appear for sentencing on September 4. He faces a minimum of 15 years and a maximum of 60 years in prison. However, the Court must consider the U.S. Sentencing Guidelines and the applicable federal sentencing statutes before imposing a sentence.
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 the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
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Former Groton Postmaster Sentenced for Stealing Government FundsRead the Press Release
BOSTON – A former United States Postal Service (USPS) employee was sentenced today in federal court in Boston for stealing approximately $7,000 in government money.
Adam Lavertue, 37, of Dracut, was sentenced today by U.S. District Court Judge Richard G. Stearns to two years of probation, 500 hours of community service, and ordered to pay restitution to the USPS. In March 2020, Lavertue pleaded guilty to one count of embezzlement and theft of public money, property or records.
Lavertue began working the USPS in April 2008 and became Postmaster of the Groton Post Office in June 2015. In this role, Lavertue performed a variety of managerial and administrative tasks to facilitate the daily operations of the Post Office, including maintaining the facility’s operational functions, handling customer transactions and managing mail clerks and delivery staff. In February 2017, Lavertue began using the purchase charge card issued to the Groton Post Office to make over $500 in personal purchases, including food, beverages and tobacco products. Additionally, Lavertue used Post Office Voyager cards, which are used by USPS mail couriers to fuel the official USPS delivery vehicles, to fuel his personally owned vehicle, charging over $5,000 in fuel. Lavertue also stole over $1,000 in cash from his assigned cash register drawer and reserve at the Groton Post Office. Lavertue’s scheme cost the USPS approximately $7,000.
United States Attorney Andrew E. Lelling; Matthew Modafferi, Special Agent in Charge of the United States Postal Service Inspector General; and Joseph W. Cronin, Inspector in Charge of the U.S. Postal Inspection Service made the announcement today. Assistant U.S. Attorney Eugenia M. Carris of Lelling’s Public Corruption & Special Prosecutions Unit prosecuted the case.
Former Arlington Pastor Sentenced to More Than 24 Years for Child ExploitationRead the Press Release
A former Arlington pastor was sentenced today to 293 months in federal prison for sexual exploitation of a child, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.
39-year-old Brett Jarad Monroe, former associate pastor at Heritage Baptist Church in Arlington, Texas, pleaded guilty in January to one count of sexual exploitation of a child.
"No child should ever have to endure the pain of sexual exploitation,” said U.S. Attorney Nealy Cox. “The allegations in this case are particularly disturbing due to the defendant’s employment at the time of the offense as a pastor in a position of trust. The United States Attorney’s Office along with law enforcement partners will use every available tool to identify, arrest, and hold child predators accountable.”
“This individual’s actions were revolting, and the harm he caused to innocent children is devastating and forever lasting. His conduct was particularly disturbing because he was a trusted member of the community,” said Ryan L. Spradlin, special agent in charge of HSI Dallas. “Protecting the most innocent members of our society is a top priority for HSI and we will never relent in our efforts to put monsters in disguise, like Monroe, where they belong - behind bars!”
Federal agents executed a search warrant at Monroe’s residence on December 11, 2019. Monroe admitted to agents that he used his cellphone to create secret recordings of a minor female victim while she showered at his Arlington, Texas home. According to court documents, Monroe converted the video into still images which he saved in an online storage account.
At sentencing, an agent testified that Monroe admitted to sending, receiving, and trading child pornography online for years to fuel his pornography addiction. He also confessed to surreptitiously recording multiple other minor victims showering in his residence.
This investigation was led by Homeland Security Investigations with the assistance of the Arlington Police Department, Fort Worth Police Department, and Texas DPS. Assistant U.S. Attorney A. Saleem is prosecuting this case. U.S. District Judge Reed O’Connor handed down the sentence.
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 U.S. Attorneys’ Offices and CEOS, Project Safe Childhood brings together 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.
Former Administrator of Texarkana Assisted Living Facility Sentenced for Federal ViolationsRead the Press Release
TEXARKANA, Texas – A 43-year-old Little Rock, AR man has been sentenced to federal prison for federal violations in the Eastern District of Texas, announced U.S. Attorney Stephen J. Cox today.
Antonio Otero pleaded guilty on Oct. 29, 2019 to charges of equity skimming and was sentenced to 46 months in federal prison today by U.S. District Judge Robert W. Schroeder III. Otero was also ordered to pay restitution in the amount of $2 million to the U.S. Department of Housing and Urban Development.
According to information presented in court, from before 2011 until October 2015, Otero was the administrator of the Magnolia Alzheimer’s Assisted Living facility in Texarkana, Texas, and was instrumental in the founding and operation of the facility. In order to secure millions of dollars in necessary funding, Otero obtained a loan that was insured by the U.S. Department of Housing and Urban Development (HUD.) The HUD insured loan provided a favorable interest rate and did not require the owners of the Magnolia to take personal responsibility for the loan in the event of a default. Instead, HUD would suffer the financial loss in the event that the Magnolia defaulted on the loan. As a condition of this federal benefit, Otero and the owners of the Magnolia agreed to be bound by a regulatory agreement with HUD that prohibited them from removing equity from the Magnolia unless the loan was being paid and the Magnolia had surplus cash.
Instead of paying the HUD insured loan, Otero engaged in a scheme to skim equity from the Magnolia. For example, Otero took money from the Magnolia to pay for $3,952 of camera equipment, a $3,247 watch, $2,520 in landscaping for his personal residence, a $27,408 personal mortgage payment, a $12,750 down payment on a personal vehicle, and $1,540 tickets to a Dallas Cowboys football game. Additionally, he took money from the Magnolia and gave it to other individuals, including $13,000 for cosmetic surgery, $5,500 for a loan repayment, and $30,000 in equity distributions. In total, Otero took personal responsibility for causing a loss to the United States in the amount of $2 million.
This case was investigated by the Fort Worth Office of the U.S. Department of Housing and Urban Development’s Office of Inspector General and prosecuted by Assistant U.S. Attorney Jonathan R. Hornok.
Florida Man Sentenced to 4½ Years in Prison for Fraudulent Acquisition of Valuable Artworks Using Stolen IdentitiesRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that ANTONIO DIMARCO was sentenced in Manhattan federal court today to 54 months in prison for participating in a conspiracy to commit wire fraud, based on his attempt to fraudulently acquire millions of dollars’ worth of artworks from art galleries, auction houses, and private collectors from around the world. U.S. District Judge Valerie E. Caproni presided over the defendant’s sentencing.
U.S. Attorney Geoffrey S. Berman said: “Antonio DiMarco was a serial conman and deceiver who stole people’s identities, placed winning bids on renowned artworks he couldn’t afford, and defrauded lenders and insurers with false claims of ownership. As the Court noted today, DiMarco would lie to anyone if it suited his interests. DiMarco received a prison sentence commensurate with the severity of his crimes.”
As alleged in the underlying Complaint, Indictment, public filings, and statements made in open court:
From at least as early as November 2017 through and including October 2018, DIMARCO and a co-conspirator attempted to acquire millions of dollars’ worth of artworks from around the world using a variety of methods, including through appropriating the identity and financial information of a particular victim, and creating and presenting a slew of fraudulent documents.
For example, in November 2017, DIMARCO attempted to purchase artworks by Mark Rothko and Ad Reinhardt at an auction house located in New York, New York. DIMARCO obtained access to the auction through the use of an elderly victim’s identity documents, including her passport, and bank account information showing that the victim held liquid assets in excess of $7 million. DIMARCO and his co-conspirator further presented false information indicating that the victim had authorized DIMARCO to bid on her behalf, when in reality, the victim knew nothing about DIMARCO’s plan to purchase artworks in her name. DIMARCO won the auction, bidding close to $6.5 million for the Rothko work, and $1,155,000 for the Reinhardt work. As DIMARCO in fact lacked funds to pay for the art, however, the auction house suffered a loss of close to $1.4 million.
Continuing throughout late 2017 through at least May 2018, DIMARCO and his co-conspirator attempted to purchase artworks from approximately 20 galleries and collectors throughout the world. Indeed, DIMARCO and his co-conspirator entered into completed sales agreements for more than 60 artworks totaling in excess of $150 million. Among other works, DIMARCO entered into a contract for a $16.5 million Matisse painting. None of these works was ever paid for, yet to entice the galleries and collectors to continue to hold the artwork for DIMARCO and his co-conspirator, they passed strings of false excuses for non-payment. This also caused galleries and collectors to suffer monetary losses.
Having failed to obtain valuable artworks that he had contracted to buy but never paid for, DIMARCO then began to seek out ways to monetize artworks that he had not acquired, by creating a series of false documents designed to deceive financiers and insurers into believing that in fact he owned the artworks. DIMARCO did this in hopes of obtaining funds based on the value of those artworks. DIMARCO was arrested in the course of executing this scheme, after having arranged a showing of high-value artwork he convinced others that he owned.
DIMARCO further orchestrated two additional frauds conducted in the midst of the art scheme: a ploy to deprive a victim of hundreds of thousands of dollars through false representations concerning the purposes for providing the funds, and a scheme to purchase a high-end property in Manhattan using a fraudulently altered bank statement.
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In addition to his prison term, DIMARCO was also sentenced to three years of supervised release and ordered to pay $2,384,050.00 in restitution.
Mr. Berman praised the outstanding investigative work of the Federal Bureau of Investigation’s Art Crime Team and encourages anyone with information relating to theft, looting, or fraud in the art market to contact the FBI’s Art Crime Team in New York at (212) 384-1000.
These cases are being handled by the Office’s Money Laundering and Transnational Criminal Enterprises Unit. Assistant United States Attorneys Tara M. La Morte and Abigail S. Kurland are in charge of the prosecution.
Florida Man Pleads Guilty, Sentenced to Federal Supervision for Falsely Claiming to Represent the Village People BandRead the Press Release
EUGENE, Ore.—A Florida man pleaded guilty and was sentenced to federal supervised release today for falsely claiming to represent The Village People band and swindling $12,500 from The Mill Casino in North Bend, Oregon, announced U.S. Attorney Billy J. Williams.
Howard Harlib, 67, was sentenced to time served in federal prison and three years’ supervised release. Harlib has been in state custody in Florida since 2016 after being convicted of unrelated charges.
According to court documents, in August 2015, The Mill Casino, owned and operated by the Coquille Indian Tribe, received a flier from Harlib advertising the opportunity to book The Village People for a show at the casino. Casino employees contacted Harlib, who spoke with them about dates, pricing, and other matters involved in the booking. The same day, Harlib sent the casino a brochure with information about his company, Premier Entertainment. Harlib claimed the band had a show in Las Vegas, Nevada the night before one of the dates discussed with the casino and, therefore, traveling to North Bend would not be an issue.
Later, Harlib emailed the casino an artistic engagement contract, which the casino signed and returned to Harlib with a check for $12,500. Harlib cashed the check two days later. In January 2016, the casino discovered that The Village People were scheduled to appear in Florida the same day they were booked to play in North Bend. After having difficulty reaching Harlib, the casino contacted another representative of the band. The representative confirmed that Harlib did not have any association with the band. Harlib later admitted he had no authority to book the band.
Harlib’s history of frauds and swindles dates back decades, to at least 1992. In 2004, he was convicted of third degree grand theft in Florida for the same exact scheme: contracting with two victims to have The Temptations, The Supremes, and Jimmie Walker perform at their venues. After spending five years in prison for that conviction, Harlib spent another five years in prison for impersonating a doctor and possessing a variety of prescription medications.
On April 29, 2019, Harlib was charged by federal criminal information with one count of wire fraud. He pleaded guilty today to the same charge.
During his sentencing, U.S. District Court Judge Ann L. Aiken ordered Harlib to pay $12,500 in restitution to the Coquille Indian Tribe.
This case was investigated by the FBI and prosecuted by Gavin W. Bruce, Assistant U.S. Attorney for the District of Oregon.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
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Five Utah Agencies Get COPS Office Awards to Hire Full-Time Law Enforcement ProfessionalsRead the Press Release
SALT LAKE CITY – Five Utah agencies are receiving funding through the Department of Justice’s Office of Community Oriented Policing Services (COPS Office) COPS Hiring Program (CHP).
The Attorney General announced funding awards to 596 law enforcement agencies across the nation Tuesday afternoon, which allows those agencies to hire 2,732 additional full-time law enforcement professionals. The COPS Office received nearly 1,100 applications requesting more than 4,000 law enforcement positions.
The City of American Fork, the Wayne County Sheriff’s Office, and the Willard Police Department will each get $125,000 to fund one officer. The City of Orem has been awarded $375,000 to fund three officers. Salt Lake City is getting $1,250,000 to fund 10 officers.
“The Department of Justice is committed to providing the police chiefs and sheriffs of our great nation with needed resources, tools, and support. The funding announced today will bolster their ranks and contribute to expanding community policing efforts nationwide,” said Attorney General William P. Barr. “A law enforcement agency’s most valuable assets are the men and women who put their lives on the line every day in the name of protecting and serving their communities.”
“This critical funding will bring 16 new law enforcement officers to agencies in Utah where they will address local needs,” U.S. Attorney John W. Huber said today. “These agencies identified specific community issues and needs where COPS funding could be effectively applied. We appreciate the COPS Office providing funding to Utah agencies. It will be put to good use.”
The COPS Hiring Program is a competitive award program intended to reduce crime and advance public safety through community policing by providing direct funding for the hiring of career law enforcement officers. In addition to providing financial support for hiring, CHP provides funding to state, local, and tribal law enforcement to enhance local community policing strategies and tactics. In a changing economic climate, CHP funding helps law enforcement agencies maintain sufficient sworn personnel levels to promote safe communities. Funding through this program had been on hold since the spring of 2018 due to a nationwide injunction that was lifted earlier this year.
CHP applicants were required to identify a specific crime and disorder problem focus area and explain how the funding will be used to implement community policing approaches to that problem focus area. Of the awards announced today, 43 percent will focus on violent crime, while the remainder of the awards will focus on a variety of issues including school-based policing to fund school resource officer positions, building trust and respect, and opioid education, prevention, and intervention.
To learn more about CHP, please visit https://cops.usdoj.gov/chp. For additional information about the COPS Office, please visit www.cops.usdoj.gov.
Felon Sent to Federal Prison for Unlawfully Possessing a FirearmRead the Press Release
A Princeton, Texas, man was sentenced May 29, 2020, to more than six years in federal prison after possessing a gun as a felon.
Rodolfo Velasco, age 36, from Princeton, Texas, received the prison term after a March 10, 2020, guilty plea to one count of Possession of a Firearm by a Felon.
Information presented by the United States at the detention, change of plea, and sentencing hearings revealed that on or about May 30, 2019, Velasco illegally possessed a pistol and ammunition. He was prohibited from possessing guns because he had been previously convicted of possession of a controlled substance in Minnesota in 2003 and of distribution of methamphetamine in Nebraska in 2011. Velasco’s unlawful possession was discovered when law enforcement apprehended him as a fugitive for a parole violation, following a foot pursuit. When he was captured he was in possession of a stolen pistol and ammunition.
Velasco was sentenced in Sioux City by United States District Court Chief Judge Leonard T. Strand. Velasco was sentenced to 77 months’ imprisonment. He must also serve a one-year term of supervised release after the prison term. There is no parole in the federal system.
Velasco is being held in the United States Marshal’s custody until he can be transported to a federal prison.
This case was brought as part of Project Safe Neighborhoods (PSN). PSN is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
This case is also part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. The United States Attorney’s Office has prosecuted this case with support from our Project Guardian partners. For more information about Project Guardian, please see /media/1122011/dl?inline.
The case was investigated by the United States Marshal’s Service and the Sioux City Police Department. The case was prosecuted by Assistant United States Attorney Forde Fairchild.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 19-4057.
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Federal grants will provide major boost to law enforcement agencies in the Southern District of GeorgiaRead the Press Release
SAVANNAH, GA: The Department of Justice today announced nearly $400 million in grant funding through the Department’s Office of Community Oriented Policing Services (COPS Office) COPS Hiring Program (CHP), with more than $4.5 million going to agencies in the Southern District of Georgia.
The Attorney General announced the awards to 596 law enforcement agencies across the nation, which allows those agencies to hire 2,732 additional full-time law enforcement professionals.
“The Department of Justice is committed to providing the police chiefs and sheriffs of our great nation with needed resources, tools, and support. The funding announced today will bolster their ranks and contribute to expanding community policing efforts nationwide,” said Attorney General William P. Barr. “A law enforcement agency’s most valuable assets are the men and women who put their lives on the line every day in the name of protecting and serving their communities.”
“The U.S. Attorney’s Office is proud of our partnerships with state and local law enforcement agencies in the Southern District, and we know these grants will provide valuable funding to help these agencies protect and serve their communities,” said Bobby L. Christine, U.S. Attorney for the Southern District of Georgia.
Of 11 grants awarded in Georgia, six of them are to agencies in the Southern District, including:
- The city of Savannah, receiving $1.875 million to hire 15 additional officers;
- Glynn County, receiving $1,402,620 to hire eight additional officers;
- The Burke County Sheriff’s Office, receiving $649,679 to hire six additional officers;
- The Dublin Police Department, receiving $375,000 to hire three officers;
- The Montgomery County Sheriff’s Office, receiving $110,888 to hire one officer; and,
- The Treutlen County Sheriff’s Office, receiving $92,682 to hire one officer.
The COPS Hiring Program is a competitive award program intended to reduce crime and advance public safety through community policing by providing direct funding for the hiring of career law enforcement officers. In addition to providing financial support for hiring, CHP provides funding to state, local, and tribal law enforcement to enhance local community policing strategies and tactics. In a changing economic climate, CHP funding helps law enforcement agencies maintain sufficient sworn personnel levels to promote safe communities. Funding through this program had been on hold since the spring of 2018 due to a nationwide injunction that was lifted earlier this year.
CHP applicants were required to identify a specific crime and disorder problem focus area and explain how the funding will be used to implement community policing approaches to that problem focus area. Forty-three percent of the awards announced today will focus on violent crime, while the remainder of the awards will focus on a variety of issues including school-based policing to fund school resource officer positions, building trust and respect, and opioid education, prevention, and intervention. The COPS Office received nearly 1,100 applications requesting more than 4,000 law enforcement positions.
The complete list of COPS grant awards can be found here: https://cops.usdoj.gov/pdf/2020AwardDocs/chp/Award_List.pdf?utm_medium=email&utm_source=govdelivery. To learn more about CHP, please visit https://cops.usdoj.gov/chp. For additional information about the COPS Office, please visit www.cops.usdoj.gov.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.