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Thursday 6 February 2020
Cincinnati Man Convicted of Fentanyl and Heroin TraffickingRead the Press Release
COVINGTON, Ky. - A Cincinnati man was convicted yesterday, by a federal jury in Covington, for participating in an extensive conspiracy to distribute kilogram quantities of heroin and fentanyl.
After two hours of deliberation, following a three-day trial, the jury convicted 37-year old Quintin Tyler Brian Davis of conspiracy to distribute 400 grams or more of fentanyl and one kilogram or more of heroin. They also found him guilty of possessing fentanyl and heroin with the intent to distribute it.
According to testimony at trial, Davis conspired with Ronnie Teets and Donald Hoffman to distribute multiple kilograms of fentanyl and heroin received through delivery services, cut the substances with lactose, and distributed them in the Greater Cincinnati area. Agents seized more than $100,000 in currency, a loaded handgun, and several quantities of heroin and fentanyl from locations in Cincinnati and Florence, Kentucky, in August of 2018.
Davis, Teets, and Hoffman were indicted in December 2018. Davis’ co-defendants previously pleaded guilty to conspiracy charges. Hoffman pleaded guilty in December 2018, and Teets pleaded guilty in April 2019.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky, Keith Martin, Special Agent in Charge, DEA Detroit Field Division; Director Christopher Conners, Northern Kentucky Drug Strike Force; and Chief Eliot Isaac, Cincinnati Police Department, jointly announced the conviction.
The investigation was conducted by the DEA, the Northern Kentucky Drug Strike Force, and Cincinnati Police Department. The U.S. Attorney’s Office was represented in the case by Assistant U.S. Attorney Tony Bracke.
Davis will appear for sentencing on May 21, 2020. He faces up to a maximum of life in prison. However, the Court must consider the U.S. Sentencing Guidelines and the applicable federal sentencing statutes before imposing a sentence.
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Charleston Man Sentenced to 10 Years in Federal Prison for Drug and Gun CrimesRead the Press Release
CHARLESTON, W.Va. – A Charleston man was sentenced to federal prison for armed drug trafficking crimes, announced United States Attorney Mike Stuart. Kevin Huffman, 36, was sentenced to 10 years in prison for possession with intent to distribute methamphetamine and possession of a firearm in furtherance of a drug trafficking crime.
“10 years in federal prison,” said United States Attorney Mike Stuart. “We are tough, tough, tough on crime. Through increased and aggressive efforts to prosecute drug dealers like Huffman, we are making great progress towards safer streets, safer families and a safer West Virginia.”
Huffman previously admitted that he agreed to meet and sell methamphetamine to an individual now known to be a confidential police informant in Dunbar, West Virginia on November 30, 2017. Police approached a vehicle driven by Huffman to the meeting point. Huffman was found sitting on top of a Ruger, model SR, .40 caliber pistol. Following a search of the vehicle driven by Huffman, officers recovered a distribution quantity of methamphetamine and the firearm, as well as cash and Xanax, Diazepam and Clonazepam pills. At the plea hearing, Huffman admitted that he possessed the firearm to further his drug trafficking activities.
The Metropolitan Drug Enforcement Network Team (MDENT) and the Charleston Police Department’s Special Enforcement Unit conducted the investigation. Senior United States District Judge John T. Copenhaver, Jr. presided over the hearing.
This case is being prosecuted as part of the Project Safe Neighborhoods (PSN) program, 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.
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CRA/LA Agrees to Pay $3.1 Million to Resolve Alleged Misuse of Federal Funds for Inaccessible HousingRead the Press Release
CRA/LA agreed to pay $3.1 million to resolve allegations that its predecessor violated the False Claims Act by knowingly failing to comply with federal accessibility laws when it financed and assisted in the development of affordable housing in the City of Los Angeles supported by federal funds, the Department of Justice announced.
CRA/LA is the successor of the Community Redevelopment Agency of the City of Los Angeles, a local redevelopment agency that financed and assisted in the development of multifamily affordable housing using local tax monies and federal community development grants. In June 2011, the State of California dissolved all redevelopment agencies. CRA/LA is winding down the affairs of its predecessor.
“Today’s settlement demonstrates our continuing vigilance to ensure that developers receiving federal grant money for affordable housing satisfy their legal obligations to make such housing accessible to people with disabilities,” said Assistant Attorney General Jody Hunt for the Department of Justice’s Civil Division. “Grant recipients who knowingly discriminate against people with disabilities using taxpayer money will face serious consequences.”
“Despite millions of dollars of federal taxpayer money sent to Los Angeles to create affordable housing over many years, the CRA opted to lie about its failure to ensure that these projects were accessible to everyone,” said U.S. Attorney Nick Hanna for the Central District of California. “This settlement resolves only a small portion of this case, and we are prepared to litigate additional allegations that the City of Los Angeles covered up its failure to comply with federal laws enacted to protect the civil rights of all citizens.”
“The basic tenant of fair housing translates into the premise of equal access for all, this is to include those citizens that face physical and functional challenges,” said Inspector General Rae Oliver Davis of the U.S. Department of Housing and Urban Development. “This settlement reaffirms this office’s steadfast resolve to ensure those who receive federal housing funds abide by this fundamental principle.”
“This case demonstrates HUD’s commitment to holding recipients of federal funds accountable for their failure to comply with HUD’s accessibility requirements,” said General Counsel Paul Compton of the U.S. Department of Housing and Urban Development. “We will continue to collaborate with our partners at the Department of Justice to ensure that HUD participants provide accessible housing to individuals with disabilities.”
Recipients of federal housing development funds must comply with federal accessibility laws, including Section 504 of the Rehabilitation Act, the Americans with Disabilities Act, and the Fair Housing Act. These laws prohibit discrimination against people with disabilities in activities receiving federal financial assistance. For example, they require five percent of all units in certain federally-assisted multifamily housing be accessible for people with mobility impairments and an additional two percent be accessible for people with visual and auditory impairments. Recipients of federal funds must likewise implement accessible programs related to housing, including maintaining a publicly-available list of accessible units with a description of their accessibility features, adopting policies and procedures to ensure that people who need the accessibility features of particular units occupy them, and designating at least one individual to coordinate accessibility efforts.
The settlement resolves claims against CRA/LA in a lawsuit alleging that the CRA/LA’s predecessor, along with the City of Los Angeles, received money from the U.S. Department of Housing & Urban Development based on false claims they were complying with federal accessibility laws. As to the CRA/LA’s predecessor, the United States’ lawsuit alleged at least nine multifamily housing properties fell significantly short of federal accessibility laws since 2005. Examples of alleged defects included:
- slopes and ramps too steep for people in wheelchairs;
- tall thresholds restricting wheelchair access;
- kitchen cabinets, shelves, and surfaces outside the accessible reach range of people in wheelchairs;
- sinks, grab bars, and mailboxes mounted outside the accessible reach range of people in wheelchairs;
- uninsulated pipes below sinks and lavatories;
- a lack of accessible parking spaces; and
- insufficient visual alarms and tactile signs for people with hearing and visual impairments.
The United States’ claims against the City of Los Angeles have not been resolved and are still pending in the litigation.
The agreement announced today partially resolves a lawsuit filed in U.S. District Court in Los Angeles by Mei Ling, a Los Angeles resident who uses a wheelchair, and the Fair Housing Council of San Fernando Valley, a nonprofit civil rights advocacy group. The lawsuit was filed under the qui tam or whistleblower provisions of the False Claims Act, which permit private parties to sue on behalf of the United States when they believe that a party has submitted false claims for government funds, and to receive a share of any recovery. The False Claims Act permits the government to intervene in such a lawsuit, as it has done in this case.
These matters were investigated and litigated by the Civil Division’s Commercial Litigation Branch and the U.S. Attorney’s Office for the Central District of California. HUD’s Office of Inspector General and Office of General Counsel also participated in the investigation.
The claims asserted against the CRA/LA and the City of Los Angeles are allegations only; there has been no determination of liability. The case is captioned United States ex rel. Ling, et al. v. City of Los Angeles, et al., No. CV11-00974-PSG (C.D. Cal.).
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.
Bridgeport Man Pleads Guilty to Firearm OffensesRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that LYNWOOD COGDELL, 32, of Bridgeport, pleaded guilty today in New Haven federal court to two counts of possession of a firearm in furtherance of a drug trafficking offense.
According to court documents and statements made in court, on March 15, 2016, Cogdell was sentenced in federal court to 36 months of imprisonment, followed by three years of supervised release, for possession of a firearm by a convicted felon. He was released from federal prison in June 2018.
On August 10, 2018, while on supervised release, Cogdell was arrested by Stamford Police after he was found in possession of a loaded .40 caliber semi-automatic pistol, and 150 folds of heroin that he intended to distribute.
On April 15, 2019, Cogdell was arrested by Connecticut State Police in Bridgeport after he was found in possession of a loaded .40 caliber semi-automatic pistol, and 58 folds of heroin/fentanyl that he intended to distribute.
Cogdell is scheduled to be sentenced by U.S. District Judge Janet C. Hall in New Haven on May 5, 2020, at which time he faces mandatory term of imprisonment of 10 years and a maximum term of life imprisonment.
Cogdell also faces additional penalties if he is found to have violated the conditions of his supervised release.
This matter has been investigated by U.S. Marshals Service, Stamford Police Department, Bridgeport Police Department, and Connecticut State Police. The case is being prosecuted by Assistant U.S. Attorney Lauren C. Clark.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make neighborhoods safer for everyone.
Birmingham Woman Convicted for Conspiracy to Commit Mail and Wire Fraud and Intimidating a WitnessRead the Press Release
Birmingham, Ala. – Following a three-day bench trial, a Birmingham woman was convicted on charges of conspiracy to commit mail and wire fraud and intimidating a witness, announced U.S. Attorney Jay E. Town and IRS Criminal Investigation Special Agent in Charge Andrew M. Thornton, Jr.
After three days of testimony, U.S. District Court Judge R. David Proctor convicted Quincetta Yvonne Cargill, 48, of one count of conspiracy to commit mail and wire fraud and one count of witness tampering. Cargill represented herself and also took the stand to testify.
“This case was about greed at the expense of too many,” Town said. “The finding of guilt for this individual should forewarn anyone that would commit fraud on the taxpayers by filing false tax returns will be prosecuted to the fullest extent. Thanks to the hard work of the prosecutors and agents the defendant has been brought to justice.”
“Individuals who commit refund fraud and identity theft of this magnitude and with this degree of trickery, dishonesty and deceit, deserve to be punished to the fullest extent of the law," Thornton said. "IRS Criminal Investigation, along with our law enforcement partners and the United States Attorney's Office, remain vigilant in identifying, investigating and prosecuting those individuals who seek to willfully defraud the United States Treasury and blatantly disregard the victims of their schemes.”
Evidence at trial, including witness testimony, bank records, and IRS tax returns, proved that Cargill obtained the names, dates of birth, and social security numbers of individuals, told them she was submitting their information for a federal grant program, and instead caused fraudulent tax returns to be filed with their information. Cargill then directed others to open bank accounts, and used her own bank accounts, to receive tax refund checks from those fraudulently filed returns. In total, Cargill and her co-conspirators obtained more that $1 million from refunds from fraudulent tax returns. Evidence at trial also proved that Cargill attempted to intimidate a witness in her case by sending information about the witness and their potential testimony to members of a motorcycle club, in order to influence or prevent that witness from testifying at trial.
The maximum penalty for conspiracy to commit mail and wire fraud is 20 years in prison and a $250,000 fine. The maximum penalty for witness tampering is 20 years in prison and a $250,000 fine.
IRS-CID investigated the case, which Assistant U.S. Attorney Allison Garnett and Blake Milner are prosecuting.
Berea Man Indicted for Child Pornography CrimesRead the Press Release
LEXINGTON, Ky.- Larry Dale Foley, 48, of Berea, Kentucky, was indicted on Thursday in federal court for receipt, distribution, and possession of child pornography.
The indictment alleges that, on December 17, 2018, Foley received images of child pornography. Foley is also charged with distributing child pornography on December 30, 2018. The indictment alleges that on January 6, 2020, Foley possessed images of child pornography. The indictment seeks forfeiture of Foley’s interest in several cellphones, tablets, laptop computers and flash drives.
The investigation preceding the indictment was conducted by the Department, Federal Bureau of Investigation (FBI), and the Berea Police Department. If anyone has additional information related to the case, they are encouraged to contact the FBI at (859) 254-4038.
Foley’s next appearance before the United States District Court in Lexington is TBD. If convicted, Foley faces a maximum prison sentence of 20 years. However, any sentence following conviction would be imposed by the court after consideration of the United States Sentencing Guidelines and the federal statute governing the imposition of sentences.
Any indictment is an accusation only. A defendant is presumed innocent and is entitled to a fair trial at which government must prove guilt beyond a reasonable doubt.
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Beaumont Couple Guilty of Falsifying Tax ReturnsRead the Press Release
BEAUMONT, Texas –A Beaumont, Texas business owner and his wife have been convicted of federal tax violations in the Eastern District of Texas, announced U.S. Attorney Joseph D. Brown today.
Dick Brocato, Jr., 68, and his wife, Judith L. Brocato, 65, both of Beaumont, Texas, were convicted on Feb. 5, 2020 by a jury following a three-day trial before U.S. District Judge Marcia A. Crone. The Brocatos were found guilty of conspiracy to defraud the United States for purposes of impeding the government functions of the Internal Revenue Service (IRS) in the collection of income tax and six counts of making and submitting false tax returns on both their personal and business for 2012-2014.
According to information presented in court, the Brocatos owned a lawn service company, Superior Lawn Service, which was operated for tax purposes as an S corporation. The Brocatos were the sole shareholders of the company with Judith Brocato as corporate president, maintaining the books and records of the corporation, and signing the corporate tax returns in that capacity. The Brocatos conspired to defraud the United States for the purpose of impeding, impairing, and obstructing, the lawful government functions of the Internal Revenue Service (IRS) in the ascertainment, computation, assessment, and collection of federal income and other taxes for years 2012, 2013, and 2014. As part of that conspiracy, they filed false corporate and personal income tax returns for years 2012, 2013, and 2014. To facilitate the scheme, the Brocatos underreported income received by checks from numerous customers of the company after having the checks cashed rather than depositing the checks into the company accounts. They then purposefully failed to report the cash income amount on the various tax returns. According to the indictment, the underreported income amounted to $503,281 in 2012, $687,534 in 2013, and $513,498 in 2014. A federal grand jury returned an indictment on Sep. 4, 2019 charging Dick and Judith Brocato with tax violations.
“The obligation of all of us to pay our taxes is important, and no one should forget that there are criminal penalties for failing to pay your taxes as required,” said United States Attorney Joseph D. Brown. “And it is again tax season, so this verdict is a timely reminder.”
Under federal statutes, the Brocatos each face up to 5 years in federal prison at sentencing. The maximum statutory sentence prescribed by Congress is provided here for information purposes, as the sentencing will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the U.S. Probation Office.
This case was investigated by the Internal Revenue Service Criminal Investigation Division and prosecuted by Assistant U.S. Attorneys Robert L. Rawls and John B. Ross
Altoona Man Pleads Guilty in $1 Million Fraud Scheme and Failed to Pay TaxesRead the Press Release
PITTSBURGH, PA - A resident of Blair County, Pennsylvania, pleaded guilty in federal court in Pittsburgh on charges of tax evasion and wire fraud, United States Attorney Scott W. Brady announced today.
Patrick S. LaMarsh, age 40, of Altoona, pleaded guilty to two counts before United States District Judge Cathy Bissoon.
In connection with the guilty plea, between 2011 and 2013, LaMarsh defrauded TracFone and Walmart by selling fraudulently obtained Straight Talk airtime cards on Amazon.com. According to the information provided to the court, LaMarsh fraudulently re-encoded Straight Talk prepaid wireless cards and sold them for a discount, netting in excess of one million dollars in sales. LaMarsh used the proceeds to buy precious metals and a recreational vehicle. In addition, LaMarsh deposited proceeds into nominee bank accounts to conceal income.
Judge Bissoon scheduled the sentencing for June 24, 2020 at 10:00 a.m. The law provides for a total sentence of five years’ imprisonment for each count of conviction for tax evasions, and 20 years imprisonment for each count of conviction for wire fraud, a fine of $4,750,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the criminal history, if any, of the defendant.
Assistant United States Attorney Gregory C. Melucci is prosecuting this case on behalf of the government.
The Internal Revenue Service-Criminal Investigations and United States Secret Service conducted the investigation leading to the indictment in this case.
Wednesday 5 February 2020
Youngstown man sentenced to 12 years for intending to distribute pressed fentanyl pills disguised as Oxycodone and violating the terms of federal supervisionRead the Press Release
Benjamin Ross, 28, of Youngstown, Ohio, was sentenced for his role in a scheme to distribute fentanyl pills, which were pressed, colored and stamped to look like 30 milligram oxycodone hydrochloride pills. Judge John R. Adams sentenced Ross to 144 months of incarceration, to be followed by ten years of supervised release.
According to the indictment and other court records, on May 15, 2019, Ross knowingly and intentionally possessed with the intent to distribute 117.70 grams of fentanyl.
Between March 19, 2019 and May 15, 2019, Ross was in contact with an individual via the WhatsApp mobile messaging platform. These communications revealed that Ross sought to purchase fentanyl pills disguised as oxycodone. During one such communication, Ross complained that the blue color of the pills he had just received did not match the standard oxycodone color and could possibly alert his customers to the fact that the pills were not legitimate oxycodone pills. Ross provided an address to the individual so that the individual could mail the shipment via the U.S. Postal Service. Just prior to May 15, 2019, the individual provided Ross with the tracking number so that Ross would know when to pick up the shipment. The shipment was delivered to the address Ross provided on May 15, 2019. Immediately after Ross picked up the shipment, the Ohio State Highway Patrol conducted a traffic stop. During that traffic stop, a police canine alerted to the odor of narcotics inside the car. Troopers found a bag of round, light-blue pills, which were marked “M” and “30” as if they were 30 milligram oxycodone pills. A laboratory test confirmed the 117.7 grams of pills actually contained fentanyl. At the time of his arrest, Ross was under supervision after serving 57 months for a prior federal firearms conviction. Ross was released from custody and began supervision on March 22, 2019.
Judge Adams found this drug trafficking conviction was a violation of the terms of Ross’ supervised release. Ross was sentenced to 120 months for trafficking fentanyl followed by a consecutive sentence of 24 months for violating his supervised release.
This case was prosecuted by Assistant U.S. Attorneys Patrick Burke and Danielle Angeli Asher following an investigation by the Drug Enforcement Administration, U.S. Postal Inspection Service, The Ohio State Highway Patrol and U.S. Immigration and Customs Enforcement.
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Woman That Overstayed Her Visa Pleads Guilty to ID Theft, Fraud ChargesRead the Press Release
PROVIDENCE – A Dominican national that remained in the United States without permission after her six-month visa expired in June 2003, today admitted that while remaining in the country illegally, she used the stolen identity and Social Security number of a woman living in Puerto Rico to obtain a Rhode Island driver’s license and government financed health care, unemployment, disability, and food stamp benefits.
Sonia Jordain, 54, pled guilty as charged in an indictment returned in U.S. District Court in Providence in June 2019, to false representation of citizenship, false representation of a Social Security number, aggravated identity theft, theft of public money, and two counts of wire fraud.
Jordain admitted to the court that in February 2014, she used the stolen identity and stolen Social Security number when applying for Supplemental Nutrition Assistance Program (SNAP) benefits. On the application, Jordain falsely stated that neither she, nor anyone in her household, was not a United States citizen.
Jordain admitted that in February 2014, she also used the stolen identity and Social Security number to obtain government-paid health care benefits; in May 2016 to obtain a Rhode Island driver’s license; in December 2016 to obtain SNAP benefits; in March 2017 to receive temporary disability insurance (TDI) from the Rhode Island Department of Labor and Training; and in October 2017 to obtain unemployment insurance benefits from the Rhode Island Department of Labor and Training.
According to the government’s evidence, Jordain fraudulently received $40,070 in health care benefits, $5,928 in unemployment insurance benefits, $2,285 in TDI benefits, and $3,800 in SNAP benefits.
She is scheduled to be sentenced on May 7, 2020.
Jordain’s guilty plea before U.S. District Court Judge William E. Smith is announced by United States Attorney Aaron L. Weisman, Homeland Security Investigations Acting Special Agent in Charge Jason Molina, Special Agent in Charge of the Department of Health and Human Services, Office of Inspector General Phillip Coyne, Special Agent in Charge of the New York Region of the Department of Labor Office of Labor Racketeering and Fraud Investigations Michael C. Mikulka, and Bethanne M. Dinkins, Special Agent in Charge of the Northeast Region of the United States Department of Agriculture Office of Inspector General.
The case is being prosecuted by Assistant U.S. Attorney Dulce Donovan.
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Windsor Locks Man Sentenced to 5 Years in Federal Prison for Child Pornography OffenseRead the Press Release
John H. Durham. United States Attorney for the District of Connecticut, announced that BRIAN GREGAN, 33, of Windsor Locks, was sentenced today by U.S. District Judge Janet C. Hall in New Haven to 60 months of imprisonment, followed by five years of supervised release, for soliciting and receiving child pornography.
According to court documents and statements made in court, in June 2017, Gregan and a 13-year-old boy communicated through the Kik messaging application. After the boy informed Gregan that he was 14 years old, they engaged in sexually explicit communications. Gregan sent several sexually explicit pictures of himself to the boy, and he solicited sexually explicit images from the boy. In response to these solicitations, the boy sent sexually explicit pictures and a video of himself to Gregan.
The investigation also revealed that, in 2016, Gregan met a 15-year-old girl online. He requested sexually explicit photographs and videos from the girl. Analysis of Gregan’s Apple iPad revealed a sexually explicit video of the girl made when the girl was under the age of 18.
Gregan was arrested on related state charges on April 6, 2018. On October 7, 2019, he pleaded guilty in federal court to one count of receipt of child pornography.
Gregan, who is released on a $50,000 bond with internet and location monitoring conditions, is required to report to prison on April 7, 2020.
This matter was investigated by the Federal Bureau of Investigation and the Manchester Police Department. The case was prosecuted by Assistant U.S. Attorney Neeraj N. Patel.
This prosecution is part of the U.S. Department of Justice’s Project Safe Childhood Initiative, which is aimed at protecting children from sexual abuse and exploitation. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
To report cases of child exploitation, please visit www.cybertipline.com.
United States Joins Suit Against New Albany Orthopaedic Clinic Alleging False Claims for Medical ServicesRead the Press Release
Oxford, MS - The United States has intervened in a whistleblower suit filed in the U.S. District Court for the Northern District of Mississippi against Mitias Orthopaedics, PLLC. Mitias provides orthopedic care in New Albany, MS.
The suit alleges that Mitias knowingly submitted false claims for FDA-approved name-brand knee injectable devices, and received payment at those rates, but actually purchased and utilized a much cheaper product from a compound pharmacy to increase profit margin.
The lawsuit was originally filed under the qui tam or whistleblower provisions of the False Claims Act by a pharmaceutical sales representative. Under the acts, a private party, known as a relator, can file an action on behalf of the United States and receive a portion of the recovery. The act permits the United States to intervene in and take over the action, as it has done here. If a defendant is found liable for violating the act, the United States may recover three times the amount of its losses plus applicable penalties and costs.
“Our office is committed to protect taxpayer dollars from waste, fraud, and abuse and ensure the integrity of our federal healthcare programs like Medicare, Medicaid, TRICARE and Railroad Medicare,” said U.S. Attorney William C. Lamar for the Northern District of Mississippi. “CMS/Medicare is ready, willing, and able to pay for high-quality products. Any attempt to manipulate the reimbursement system drives up costs for everyone,” Lamar added.
The lawsuit is being handled by the Civil Division within the U.S. Attorney’s Office for the Northern District of Mississippi. Investigative support is being provided by the Department of Health and Human Services Office of Inspector General and Office of General Counsel, the Centers for Medicare and Medicaid Services, and the Food and Drug Administration.
The case is captioned United States ex rel. Gray v. Mitias Orthopaedics, PLLC (3:15-cv-127). The claims alleged in the lawsuit are allegations only, and there has been no determination of liability. The United States will file its own formal complaint as allowed by law.
U.S Attorney Russell Coleman Opens Bowling Green Office with Full-Time Federal Prosecutors for First Time EverRead the Press Release
BOWLING GREEN, Ky. – For the first time in the history of Kentucky there will be a full-time staffed federal prosecutors’ office in Bowling Green, Kentucky, announced United States Attorney Russell Coleman.
“You shouldn’t expect less of your government the further you live from Louisville or the Golden Triangle,” said U.S. Attorney Russell Coleman. “Having a full-time office in Bowling Green will allow us to better collaborate with our many outstanding law enforcement partners throughout SouthCentral Kentucky in the fight to protect Warren and surrounding counties from predators seeking our kids, online thieves targeting our older family members, and historically high levels of drug cartel-produced poison from Mexico.”
Opening the full-time staffed office was a lengthy administrative process, requiring approval from the U.S. Department of Justice in Washington, DC, and ultimately Congress. Historically the unstaffed courthouse office has been used by federal prosecutors making the two hour commute from the U.S. Attorney’s Office in Louisville. Having full-time Assistant U.S. Attorneys in Bowling Green that live in the community will foster deeper working relationships with local law enforcement and state prosecutors that will lead to better outcomes for the citizens of the Southcentral Kentucky region in mitigating the threat of increased drug trafficking in ever more dangerous substances, online elder fraud, and child exploitation.
“The opening of a United States Attorney's Office will both expedite federal cases and foster a closer working relationship with state, local and federal law-enforcement,” said Tommy Loving, Director of Bowling Green-Warren Co. Drug Task Force. “I have personally asked many times over the last 20 years for a full-time United States Attorney's Office to be opened in Bowling Green. I thank United States Attorney Russell Coleman for listening to our needs and opening this office. Without his strong support of law-enforcement this would have never happened and it will be a great asset to the entire region.”
“As the Warren County Attorney, I am thrilled to have the opportunity to partner with the United States Attorney’s Office to provide a collaborative effort between County Government and the Federal Government,” said Warren Co. Attorney Amy Milliken. “This partnership, while unique, will prove to be beneficial to all Warren County citizens. Working together builds strong partnerships and those partnerships equate to friendships. I am excited to work with USA Russell Coleman to make this office, position and partnership a success!”
"FBI Louisville welcomes the United States Attorney’s Office (WDKY) full-time to Bowling Green,” said Special Agent In-Charge Robert Brown Jr. “This is a monumental win for Kentucky. Having dedicated federal prosecutors working side by side with our Special Agents in Bowling Green, as well as with other federal and state partners, will only bolster all of our commitments to protecting the citizens of the Western District of Kentucky.”
The announcement was made during a ribbon-cutting ceremony held at the United States District Courthouse in Bowling Green, which will initially accommodate full-time Assistant United States Attorney (AUSA) Madison Sewell who will be joined by Special Assistant United States Attorney (SAUSA) Mark Yurchisin, and yet another full-time AUSA later this year once hired by U.S. Attorney Coleman.
Yurchisin, who was born and raised in Warren County, was sworn-in as the first-ever Bowling Green-based Special Assistant U.S. Attorney on Wednesday during the ribbon-cutting ceremony. He currently serves as an Assistant County Attorney for Warren County Attorney Amy Milliken. Prior to joining the county attorney’s office, Yurchisin served as an Assistant Commonwealth’s Attorney for the 38th Judicial District in Morgantown, Kentucky. As a SAUSA, Yurchisin will serve as a critical link between the U.S. Attorney’s Office and local prosecutors to better protect the people of Southcentral Kentucky from drug trafficking, fraud, and violent crime.
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Two members of Navajo Nation face federal murder chargesRead the Press Release
ALBUQUERQUE, N.M. – Timothy Chischilly, 48, and Stacy Yellowhorse, 48, of Mexican Springs, New Mexico, appeared in federal court in Albuquerque on Feb. 4 for detention hearings on a criminal complaint charging them with murder. A federal magistrate judge ordered them to remain in custody pending trial.
According to the criminal complaint, Chischilly and Yellowhorse allegedly committed the murder within the boundaries of the Navajo Nation, in McKinley County, in late January 2020. The victim was allegedly beaten to death with a sledgehammer. Chischilly and Yellowhorse are members of the Navajo Nation.
The FBI arrested Chischilly and Yellowhorse on February 2. They face up to life in prison if convicted of the charged offense. A criminal complaint is only an accusation. Defendants are presumed innocent unless and until proven guilty.
The Gallup office of the FBI investigated this case with assistance from the Navajo Nation Police Department, the Gallup Police Department, and the New Mexico Office of the Medical Investigator. Assistant U.S. Attorney Allison Jaros is prosecuting the case.
Two Owners of Telemedicine Companies Charged for Roles in $56 Million Conspiracy to Defraud Medicare and Receive Illegal Kickbacks in Exchange for Orders of Orthotic BracesRead the Press Release
The owners of two telemedicine companies were charged in an indictment unsealed yesterday for allegedly orchestrating a nationwide scheme to receive kickbacks and bribes in exchange for the ordering of medically unnecessary orthotic braces (braces) for beneficiaries of Medicare.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, First Assistant U.S. Attorney Rachael Honig of the District of New Jersey, Deputy Inspector General for Investigations Gary Cantrell of the U.S. Department of Health and Human Services Office of Inspector General (HHS-OIG) and Assistant Director Terry Wade of the FBI’s Criminal Investigative Division made the announcement.
Reinaldo Wilson, 51, and Jean Wilson, 49, husband and wife of Richmond Hill, Georgia, the owners of purported telemedicine companies Advantage Choice Care LLC (ACC) and Tele Medcare LLC (Tele Medcare), were each charged with one count of conspiracy to defraud the United States and to pay and receive health care kickbacks, one count of conspiracy to commit health care fraud and wire fraud, three counts of receiving health care kickbacks, and one count of conspiracy to commit money laundering. Reinaldo Wilson and Jean Wilson were arrested this morning and appeared this afternoon before U.S. Magistrate Judge L. Patrick Auld of the Middle District of North Carolina. Reinaldo Wilson is being held pending a bail hearing set for Feb. 11. Jean Wilson was released and will appear for a bail hearing on Feb. 11.
The indictment alleges that Reinaldo Wilson and Jean Wilson owned and operated purported telemedicine companies ACC and Tele Medcare, which had locations in Bayonne, New Jersey, Boca Raton, Florida, and Richmond Hill, Georgia. The indictment further alleges that Reinaldo Wilson and Jean Wilson agreed to solicit and receive illegal kickbacks and bribes from patient recruiters, pharmacies, brace suppliers and others in exchange for the arranging for doctors to order medically unnecessary braces for beneficiaries of Medicare from approximately March 2017 through April 2019. In order to obtain the orders that were transmitted in exchange for kickbacks and bribes, Reinaldo Wilson and Jean Wilson, through ACC and Tele Medcare, recruited and hired health care providers to order braces for Medicare beneficiaries, the indictment alleges. Reinaldo Wilson and Jean Wilson allegedly paid illegal kickbacks and bribes to health care providers to order braces for Medicare beneficiaries that were medically unnecessary, ineligible for Medicare reimbursement and/or not provided as represented.
The indictment further alleges that Reinaldo Wilson, Jean Wilson and others transferred the brace orders to co-conspirator brace suppliers to support in excess of $56 million in false and fraudulent claims to Medicare that were submitted by brace suppliers and that Medicare paid these brace suppliers in excess of $28 million for these claims.
With regard to the money laundering charge, that indictment alleges that between approximately March 2017 and April 2019, Reinaldo Wilson and Jean Wilson agreed to engage in monetary transactions of criminally derived property in amounts greater than $10,000.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
This case was investigated by HHS-OIG and the FBI. Trial Attorney Darren C. Halverson of the Criminal Division’s Fraud Section is prosecuting the case.
The Fraud Section leads the Medicare Fraud Strike Force. Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 15 strike forces operating in 24 districts, has charged more than 4,200 defendants who have collectively billed the Medicare program for nearly $19 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
Any doctors or medical professionals who have been involved with alleged fraudulent telemedicine and DME marketing schemes – including Advantage Choice Care LLC and Tele Medcare LLC – should call to report this conduct to the FBI hotline at 1-800-CALL-FBI.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Two Mexican citizens admit roles in transporting aliens from Canada into MontanaRead the Press Release
GREAT FALLS – Two Mexico citizens who were arrested in Glacier County by Border Patrol agents investigating suspected alien smuggling from Canada pleaded guilty on Tuesday to illegally transporting aliens, U.S. Attorney Kurt Alme said.
Alberto Guillen-Gordillo, 23, and Samuel Velasco-Tovar, 28, each pleaded guilty to transportation of illegal aliens. Each defendant faces a maximum 10 years in prison, a $250,000 fine and three years of supervised release.
U.S. District Judge Brian M. Morris presided and set sentencing for May 5. Guillen-Gordillo and Velasco-Tovar remain detained.
The prosecution said in court records that on Nov. 17 at about 11:15 p.m., Border Patrol agents conducted traffic stops of two vehicles south of the United States-Canada border in Glacier County. In the first vehicle, which was a Chevrolet Suburban, the agent found the driver and nine passengers. All of the passengers admitted to being in the United States illegally. During the stop of the second vehicle, a Chevrolet Tahoe, all of the occupants ran into a nearby field. Agents found eight individuals within one to two minutes. Each of the individuals admitted to being in the United States illegally.
In all, law enforcement transported 19 suspects to the Sweetgrass Border Patrol Station for processing. Four of the transported illegal aliens told agents they had paid from $4,000 to $4,750 to be smuggled into the United States and identified Velasco-Tovar as the foot guide who helped them cross into the United States.
Shortly after the arrests, a Border Patrol agent and Glacier County Sheriff’s deputy went to a Cut Bank hotel where the subjects had been staying to determine if any remaining occupant in one of the hotel rooms was in violation of trafficking laws. Guillen-Gordillo answered the door, identified himself and was taken into custody. Guillen-Gordillo admitted to being in the United States illegally. He rented the Chevrolet Suburban and Chevrolet Tahoe from a Utah car rental company. A co-defendant identified Guillen-Gordillo as the driver of a third vehicle but that he stayed at the hotel because he was not feeling well.
A third co-defendant, Josue Bermudez-Lopez, of Mexico, pleaded guilty in December to illegally transporting aliens and is awaiting sentencing, while a fourth co-defendant has pleaded not guilty.
Assistant U.S. Attorneys Paulette Stewart, Jeff Starnes and Ethan Plaut are prosecuting the case, which was investigated by the U.S. Border Patrol and the Glacier County Sheriff’s Office.
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Two Arrested in Connection with Cryptocurrency Investment FundRead the Press Release
PHOENIX, Ariz. – John Michael Caruso, 28, of Scottsdale, Arizona, and Zachary Salter, 27, of Paradise Valley, Arizona, were both arrested on January 30, 2020, and charged by criminal complaint with conspiracy to commit wire fraud and money laundering.
A criminal complaint is simply the method by which a person is charged with criminal activity and raises no inference of guilt. An individual is presumed innocent until competent evidence is presented to a jury that establishes guilt beyond a reasonable doubt.
If you believe you may have invested money with Caruso or Salter—or their alleged cryptocurrency investment fund, Zima Digital Assets—please contact Special Agent Lamerson or Special Agent Roper at the U.S. Secret Service, Phoenix Field Office, via telephone at (602) 640-5580.
Trenton Man Sentenced to 86 Months in Prison for Possession and Sale of Firearm and Distribution of HeroinRead the Press Release
TRENTON, N.J. – A Trenton man was sentenced today to 86 months in prison for possessing a firearm and ammunition as a convicted felon and for distributing quantities of heroin, U.S. Attorney Craig Carpenito announced.
Kendall Rossi, 41, previously pleaded guilty before Chief U.S. District Judge Freda L. Wolfson to Counts One and Four of an indictment charging him with unlawful possession of a firearm and ammunition as a convicted felon and distribution and possession with intent to distribute controlled substances. Judge Wolfson imposed the sentence today in Trenton federal court.
According to documents filed in this case and statements made in court:
On three occasions between August 2017 and September 2017, Rossi, who previously had been convicted of numerous felonies, and whom law enforcement officials had identified as an unlawful firearms supplier in and around Trenton, sold quantities of heroin and ANPP (a fentanyl analogue) to a confidential law enforcement source. Rossi boasted about his ability to obtain numerous firearms that he could sell. In October 2017, in a controlled transaction supervised by federal law enforcement, Rossi sold the confidential source a .380 caliber semi-automatic firearm and 47 rounds of .380 caliber ammunition. Rossi sold the firearm to the source under the belief that the source would use the firearm in connection with a robbery.
In addition to the prison term, Judge Wolfson sentenced Rossi to three years of supervised release.
U.S. Attorney Carpenito credited special agents of the Bureau of Alcohol, Tobacco, Firearms & Explosives, Newark Division, Trenton Field Office, under the direction of Special Agent in Charge Charlie J. Patterson, with the investigation leading to today’s sentence.
The government is represented by Assistant U.S. Attorney J. Brendan Day of the U.S. Attorney’s Office’s Criminal Division in Trenton.
20-052
Defense Counsel: Alyssa Cimino Esq., Fairfield, New Jersey
Tampa Woman Sentenced to Four Years in Federal Prison for Immigration Fraud Scheme Stretching from Tampa to ChicagoRead the Press Release
Tampa, Florida – U.S. District Judge Susan C. Bucklew today sentenced Erika Paola Intriago (45, Tampa) to four years in federal prison for wire fraud in connection with a fraud scheme involving her posing as an immigration attorney to more than 50 victims in Chicago and Tampa. The court also ordered Intriago to forfeit $53,663, the proceeds of her offense.
Intriago had pleaded guilty on October 31, 2019.
According to court documents, Intriago portrayed herself as an immigration attorney and personal representative offering immigration-related services. She advertised her services on social media, targeting immigrants and immigrant families from Spanish-speaking countries. In fact, Intriago was not a licensed attorney in any state.
At least 55 victims retained and paid Intriago to represent them in immigration-related matters before U.S. Citizenship and Immigration Services (USCIS) and other agencies. To prove that she was acting on the victims’ behalf, Intriago sent fraudulent letters, emails, receipts, documents, and communications to her victims, fraudulently representing that these records were legitimate communications sent from agencies of the United States, including the Department of Homeland Security and USCIS. In actuality, Intriago had either never filed the necessary immigration paperwork, had abandoned the immigration process, or the applications had already been denied without Intriago informing the victims. Intriago also threatened and intimidated victims who complained about her conduct by telling them that she would report their immigration status to U.S. immigration authorities, which Intriago claimed would result in the victims being deported.
“Immigration fraud is a serious threat to our national security,” said HSI Tampa Assistant Special Agent in Charge Michael Cochran. “Her illegal scheme tried to undermine the integrity of our nation’s legal immigration system, while preying on victims who were vulnerable and trying to navigate a path to citizenship.”
“Justice was served today with this sentencing,” said USCIS Tampa District Director Michael Borgen. “The defendant defrauded immigrants in an elaborate unlawful scheme, and USCIS’ Fraud Detection and National Security division is proud to have partnered with HSI and the U.S. Attorney’s Office to continue protecting our immigration system.”
This case was investigated by the Department of Homeland Security, Homeland Security Investigations and the United States Citizenship and Immigration Service. It was prosecuted by Assistant United States Attorney Frank Murray.
Statement from United States Attorney Jay E. Town on the Death of Kimberly Police Department Officer Nick O’RearRead the Press Release
BIRMINGHAM, Ala. – “Kimberly PD Officer Nick O’Rear’s end of watch has come to soon. Our thoughts and prayers are with his family, friends and fellow officers. This tragedy is yet another heartbreaking reminder of the dangers all law enforcement face while we enjoy the safety they provide us. We must ask ourselves how we can all join together to bridge the respect deficit for law enforcement that is directly and indirectly leading to violence against our brave men and women of the badge. Enough is enough.”
St. Thomas Man Who Mailed Drugs in Candy Wrappers to New York Pleads Guilty to Conspiracy to Distribute CocaineRead the Press Release
St. Thomas, USVI – Kemo Riley, of St. Thomas, pled guilty yesterday to one count of conspiracy to distribute cocaine, United States Attorney Gretchen C.F. Shappert announced. The Honorable Curtis V. Gomez, Chief Judge, District Court of the Virgin Islands, accepted the guilty plea.
In his plea agreement, Riley admitted to mailing a package to an individual in New York containing more than 250 grams of cocaine concealed in candy bar wrappers on May 28, 2019. Riley faces up to twenty years’ imprisonment, a three-year term of supervised release, and a fine of up to $1,000,000. Judge Gomez scheduled defendant Riley’s sentencing for June 4, 2020, at 9 a.m.
The case was investigated by the U.S. Postal Service and the Department of Homeland Security, and is being prosecuted by Assistant United States Attorneys Jennifer Blecher and Nathan Brooks.
St. Louis County Dentist Sentenced to 18 Months After Issuing Illegal Prescriptions for Opioid Narcotic Drug and Medicare FraudRead the Press Release
St. Louis, MO – Bradley A. Seyer, D.D.S., 53, of Florissant, Missouri, was sentenced today to 18 months of imprisonment and a $50,000 fine. Previously, on June 26, 2019, Dr. Seyer pleaded guilty to two felony charges of making false statements to Medicare and illegally issuing prescriptions for narcotic opioid drugs, including Hydrocodone, without a legitimate medical purpose.
According to the plea agreement, Dr. Seyer provided a prescription for Hydrocodone to a woman identified by her initials E.A. Dr. Seyer had a personal relationship with E.A. that lasted over ten years. Dr. Seyer gave E.A. money and jewelry, and took her on vacation trips. During their relationship, defendant prescribed E.A. with over 14,000 units of various anti-anxiety and opioid narcotic pain relief drugs. Dr. Seyer prepared and kept some dental treatment records for E.A., but they were incomplete. Dr. Seyer’s records failed to contain all of the prescriptions that he issued for E.A. Further, the records did not document office visits and examinations by Dr. Seyer of E.A. before he issued some of the prescriptions to her.
In his plea agreement, Dr. Seyer admitted that he and E.A. together consumed some "street" and prescription drugs for recreational purposes. E.A. often requested prescription drugs by text, leading Dr. Seyer to call in the prescriptions at her request. E.A. was depressed and had suicidal ideation, and had a history of mental illness. On several occasions during the Summer of 2018, Dr. Seyer and E.A. discussed her desire to commit suicide. Ultimately, E.A. died at her home during July, 2018 of a fentanyl overdose, although Dr. Seyer did not prescribe fentanyl to E.A.
Further, in the plea agreement, Dr. Seyer admitted that he prescribed Tramadol® to E.A.’s father, identified by his initials in the plea agreement as G.A. G.A. has Medicare coverage. Dr. Seyer had no records showing any dental treatment for G.A. However, Dr. Seyer issued five prescriptions to E.A. using G.A.'s name, and Medicare paid for these five prescriptions, including a Tramadol® prescription dated December 2, 2015.
Shortly after Dr. Seyer pled guilty in this case, effective August 28, 2019, the Missouri Legislature restricted the ability of dentists to write prescriptions for long-acting, extended release, or high dosage opioids. Mo. Rev. Stat. § 332.361(4)-(5).
“The DEA will utilize all the enforcement tools we have against medical professionals who knowingly and willfully prescribe opioid prescriptions improperly,” said Special Agent in Charge William Callahan of the Drug Enforcement Administration St. Louis Division. “I commend the Missouri Legislature for recognizing this opioid prescribing challenge by regulating the ability of dentists to write prescriptions for certain kinds of opioids.”
Curt Mueller, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General, Kansas City Region, stated, “Our office will continue to vigorously pursue healthcare providers who submit improper claims for reimbursement to publicly funded healthcare programs and, more specifically abuse their position by irresponsibly prescribing narcotics that endanger the well-being of their patients.”
“The Missouri Attorney General’s Medicaid Fraud Control Unit works tirelessly every day to ensure that Missouri citizens are protected from Medicaid fraud and fraudulent actors are held accountable. I appreciate the opportunity to work with our federal and local partners on this case,” said Attorney General Eric Schmitt.
This case was investigated by the Department of Public Safety for the City of Des Peres, Missouri and the U.S. Drug Enforcement Administration, with assistance from the Bureau of Narcotic and Dangerous Drugs of the Missouri Department of Health and Human Services, the U.S. Department of Health and Human Services, Office of the Inspector General, and the Medicaid Fraud Control Unit of the Missouri Attorney General’s Office.
St. Croix Man Arrested on Federal Charges for Allegedly Mailing over a Pound of Cocaine from St. Croix to South CarolinaRead the Press Release
St. Croix, USVI – United States Attorney Gretchen C.F. Shappert announced today that Damian Anthony Lang of St. Croix was arrested February 4, 2020 for the charge of Conspiracy to Possess with Intent to Distribute Cocaine.
According to court documents, Lang is accused of mailing two parcels from the U.S. Virgin Islands to Spartanburg, South Carolina on December 7, 2019. The parcels were intercepted and contained approximately 462 grams of a white powdery substance which field-tested positive for cocaine.
Lang was arraigned on February 4, 2020 in federal court on St. Croix and detention, preliminary and removal hearings are scheduled for February 5, 2020 at 9:00 a.m. According to court documents, Lang is currently on release pending trial in an unrelated federal case, No. 2015-13, for the charge of Felon in Possession of Ammunition.
The South Carolina case is investigated by Homeland Security Investigations, U.S. Customs and Border Patrol, United States Postal Inspection Service, and the Spartanburg County Sheriff’s Office. It is being prosecuted by Assistant U.S. Attorneys Melissa P. Ortiz and Alphonso Andrews in the U.S. Virgin Islands.
United States Attorney Gretchen C.F. Shappert reminds the public that a criminal complaint is merely a formal charging document and is not evidence of guilt. Every defendant is presumed innocent until and unless proven guilty.
Spokane Developer and Preservationist Sentenced to One Year of Home Confinement and Ordered to Pay a $60,000 Fine Plus Restitution and Forfeiture for His Role in Insurance Fraud and Money Laundering SchemeRead the Press Release
Spokane – William D. Hyslop, United States Attorney for the Eastern District of Washington, announced today that Richard Ronald Wells, age 71, of Spokane, Washington and Coeur d’Alene, Idaho, was sentenced after having pleaded guilty on April 30, 2019, to six counts of mail fraud, one count of conspiracy to commit mail and wire fraud, one count of money laundering, and one count of conspiracy to commit money laundering.
Chief United States District Judge Thomas O. Rice sentenced Wells to a 1-year term of home confinement, to be followed by a 3-year term of court supervision, and ordered him to pay a $60,000 fine. Chief Judge Rice also ordered Wells to pay restitution in the amount of $179,876 and forfeiture of $179,876. Wells forfeited this amount and paid it in full to the court registry prior to sentencing.
According to information disclosed during court proceedings, Wells admitted to participating in one staged accident in Liberty Lake, Washington, involving his $59,557 Ram pickup truck being intentionally driven into co-defendant Chris Frangella’s Ford F-150 pickup truck trailering another individual’s 36-foot Baja cigar boat. In an effort to pursue a fraudulent insurance claim, Wells lied to police and the insurance company by claiming he was the driver of the “at fault” vehicle and that it was an accident, when neither were true. The insurance proceeds fraudulently generated from the phony accident totaled $338,266. The scheme enabled Wells to eliminate approximately $80,000 in personal debt (a $20,000 loan borrowed from another individual and $59,557 he owed a credit union on his Ram truck).
Wells’ fraudulent claim also enabled co-conspirator, Sandra Talento, to collect an insurance payout for fictitious personal injuries claimed to occur in the same incident. Talento pleaded guilty on June 6, 2019, to twenty-five felonies in connection with her role in this and other staged accidents. Talento was sentenced on November 7, 2019, to a 5-year and 10-month term of imprisonment, a 3-year term of court supervision, and was ordered to pay restitution in the amount of $2,100,000 and forfeiture of $2,100,000.
According to information disclosed during court proceedings, Wells also laundered proceeds from another staged accident involving other individuals. These proceeds were derived from a September 21, 2016, staged automobile accident in Rescue, California, involving defendants Misael Reyes-Tajimaroa (using the fake identity “Andrew Arceo”), Brittany Jo Harris, Alexander Arceo and others that generated fraudulent insurance settlement payouts totaling approximately $312,838. On February 21, 2017, and February 28, 2017, an insurance company issued a $90,000 check and a $62,500 check as a result of this accident. Wells, and Reyes-Tajimaroa (using the identity “Andrew Arceo”), were listed as co-payees on each check. Both checks were deposited into Wells’ bank account. On March 20, 2017, Wells issued a $20,000 check payable to another individual, and a $15,000 check payable to a bank. A day later, Wells withdrew $100,319.56 via cashier’s check from his bank account which was used to pay off another individual’s mortgage on a property located in Spokane, Washington.
United States Attorney Hyslop, said “Ron Wells’ fraudulent conduct needlessly caused health care providers, emergency personnel and police officers to expend precious resources that otherwise could have been used to assist true victims. He lied to police and an insurance company in furtherance of an insurance fraud scheme and then he laundered criminal proceeds to disguise their illegal origin. Wells committed serious crimes here. In spite of the fact that he was once a respected community leader and developer in our region, he sacrificed that when he cheated, lied and laundered money. The sentence imposed reflects the role Wells played in the scheme and the fact that he benefitted from his fraud at the expense of the insurance system. This case should send a strong message that we will investigate and prosecute those who may seek to line their pockets through fraud and who launder their ill-gotten gains.”
Federal Bureau of Investigation Special Agent in Charge Raymond P. Duda, said "Here is an individual who let greed get in the way of doing the right thing. Now Mr. Wells is learning the real-life consequences of the decisions he made."
“Today Ronald Wells was held accountable for his participation in the staged accident conspiracy that generated more than $5.5 million dollars of fraudulent insurance proceeds and endangered the public. While our heroic first responders were treating conspirators like Wells at the accident scenes they could not respond to legitimate emergency calls,” said IRS-Criminal Investigation Special Agent in Charge Justin Campbell. “IRS-Criminal Investigation is proud to work alongside the FBI and the U.S. Attorney’s Office to bring this conspiracy to justice.”
This investigation was conducted by the Federal Bureau of Investigation, IRS Criminal Investigation, United States Marshals Service, and the United States Attorney’s Office for the Eastern District of Washington, with assistance from the National Insurance Crime Bureau. This case is being prosecuted by George J.C. Jacobs, III and Brian M. Donovan, Assistant United States Attorneys for the Eastern District of Washington.
Son and Mother Arrested in Connection with Branded Restaurant Fraud SchemeRead the Press Release
PHOENIX, Ariz. – Frank Capri, 52, of Scottsdale, Arizona, and his mother Debbie Corvo, 68, of Cave Creek, Arizona, appeared before U.S. Magistrate Judge Michelle H. Burns following their arrest earlier today. On January 28, 2020, a federal grand jury returned a 16-count indictment charging Capri, Corvo, and another individual with wire fraud and conspiracy to commit money laundering in connection with the operation of various branded restaurant locations in Arizona and across the United States. The trial is currently scheduled for April 7, 2020, before United States District Judge John J. Tuchi.
An indictment is simply the method by which a person is charged with criminal activity and raises no inference of guilt. Individuals are presumed innocent until proven guilty beyond a reasonable doubt.
Seven Rockford Residents Arrested on Federal Drug or Firearm ChargesRead the Press Release
ROCKFORD — Seven Rockford residents have been arrested by law enforcement officers on federal drug-trafficking and firearm charges.
DEREK D. JACOBS, also known as “Showtime” and “G,” 27, and RICO L. TURNER, 27, were arrested on charges of conspiracy to distribute fentanyl and heroin in Rockford from July through August 2019. The indictment returned last week also charged Jacobs with one count of distribution of heroin and two counts of distribution of fentanyl, and charged Turner with three counts of distribution of fentanyl.
Additional arrests in related cases included:
MICHAEL A. ALEXANDER, also known as “Big Mike,” 43, who was charged with four counts of distribution of cocaine base or “crack,” and one count of distribution of crack cocaine, fentanyl, and heroin.
RASHOD C. DAVIS, also known as “Rock,” 24, who was charged with one count of distribution of heroin and one count of distribution of a mixture containing fentanyl and heroin.
MARCUS I. RAYMOND, 24, TERRAIL HUNTER, 48, and CHARLES DAVIS, 26, were each charged in separate cases with illegally possessing a firearm as a convicted felon.
The charges were announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Timothy Jones, Special Agent-in-Charge of the Chicago Field Division of the U.S. Bureau of Alcohol, Tobacco, Firearms & Explosives; and Dan O’Shea, Rockford Police Chief. The FBI, Winnebago County Sheriff’s Office, and Illinois State Police assisted in the investigation. The government is represented by Assistant U.S. Attorney Vincenza Tomlinson.
Jacobs, Turner, Alexander, Rashod Davis, and Hunter appeared before U.S. Magistrate Judge Lisa A. Jensen in federal court in Rockford. Alexander pleaded not guilty and stipulated to detention. Jacobs, Turner, and Hunter each pleaded not guilty and remain in custody pending detention hearings. The hearings for Jacobs and Turner are scheduled for Feb. 6, 2020, and the detention hearing for Hunter is scheduled for Feb. 5, 2020. Rashod Davis was placed on home incarceration with location monitoring.
The public is reminded that charges contain only accusations and are not evidence of guilt. Each defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
The conspiracy count against Jacobs and Turner carries a five-year mandatory minimum prison sentence and a maximum sentence of 40 years. Each count against Jacobs, Turner, Alexander, and Rashod Davis for distribution of heroin, a mixture containing heroin and fentanyl, and crack cocaine carry a maximum sentence of 20 years. The charge of illegal possession of a firearm by a convicted felon against Raymond, Hunter, and Charles Davis carries a maximum sentence of ten years. If convicted, the Court must impose a reasonable sentence under federal sentencing statutes and the advisory United States Sentencing Guidelines.
Federal charges were also announced last week against three Rockford-area residents for alleged drug trafficking.
Holding drug dealers and illegal firearm possessors accountable through federal prosecution is a centerpiece of Project Guardian and Project Safe Neighborhoods (PSN) – the Department of Justice’s violent crime reduction strategies. Project Guardian focuses specifically on investigating, prosecuting, and preventing gun crimes, and it emphasizes the importance of using modern technologies to promote gun crime intelligence. In the Northern District of Illinois, U.S. Attorney Lausch and law enforcement partners have deployed the Guardian and PSN programs to attack a broad range of violent crime issues facing the district.
Sacaton Man Sentenced to 14 Years for Abusive Sexual Contact with a MinorRead the Press Release
PHOENIX, Ariz. – On February 3, 2020, Earl Edward Lara, 60, of Sacaton, Arizona, an enrolled member of the Gila River Indian Community, was sentenced by U.S. District Judge Michael T. Liburdi to 168 months in prison, to be followed by lifetime supervised release. He will also be required to register as a sexual offender. The defendant pleaded guilty on October 8, 2019, to Abusive Sexual Contact with a Minor.
The investigation in this case was conducted by the Gila River Police Department. The prosecution was handled by Raynette Logan, Assistant U.S. Attorney, District of Arizona, Phoenix.
Queens Man Pleads Guilty to Kidnapping That Resulted in the Murder of 24-Year-Old New Rochelle WomanRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today that JAVIER ENRIQUE DA SILVA ROJAS (the “defendant” or “DA SILVA”) pled guilty in White Plains federal court to kidnapping Valerie Reyes (the “Victim”) in New Rochelle, New York, and unlawfully transporting her to Connecticut, where her body was found approximately a week later. DA SILVA, who was arrested in Flushing, Queens, in February 2019, pled guilty today before U.S. District Judge Vincent L. Briccetti.
U.S. Attorney Geoffrey S. Berman said: “As he admitted today in court, Javier Da Silva committed a horrid kidnapping that resulted in the tragic death of Valerie Reyes, a young woman with her entire adult life ahead of her. Thanks to the excellent work of the FBI and our local law enforcement partners, Da Silva is now facing serious consequences.”
According to the criminal Information filed today, as well as other public documents, and statements made during today’s court proceeding:
DA SILVA and the Victim were previously in a romantic relationship, which ended in approximately April 2018. In the late evening of January 28, 2019, DA SILVA rented a car from a garage in Flushing, New York, and drove to the Victim’s residence in New Rochelle, New York, arriving in the early morning hours of January 29, 2019. Before he entered the Victim’s home, DA SILVA switched his phone to “airplane mode.” DA SILVA then kidnapped the Victim – covering her mouth with several layers of packing tape and binding her feet and hands with packing tape and twine and putting her in a suitcase – before disposing of her body in Connecticut. Over the ensuing days, DA SILVA used the Victim’s debit card on various occasions to withdraw approximately $5,350 in cash from her bank account. DA SILVA also sold an iPad belonging to the Victim in the days following her death.
On January 30, 2019, Valerie Reyes was reported missing to the New Rochelle Police Department. A few days later, on February 5, 2019, her body was recovered in a red suitcase alongside a public road in the Town of Greenwich, Connecticut. The Connecticut Medical Examiner’s Office later concluded that the Victim died of homicidal asphyxiation.
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DA SILVA, 25, pled guilty to one count of kidnapping. The charge carries a maximum term of life in prison. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by a judge. DA SILVA is scheduled to be sentenced by Judge Briccetti on May 21, 2020, at 11:00 a.m.
Mr. Berman praised the outstanding work of the Federal Bureau of Investigation’s (“FBI”) Westchester County Safe Streets Task Force, the FBI New Haven Division, the New Rochelle Police Department, the Greenwich Police Department, the Westchester County District Attorney’s Office, the Westchester County Department of Public Safety, and the Westchester County Real Time Crime Center.
This case is being handled by the Office’s White Plains Division. Assistant United States Attorneys Sam Adelsberg, Mathew Andrews, and Andrew Dember are in charge of the prosecution.
Queens Man Indicted on Sexual Exploitation and Child Pornography ChargesRead the Press Release
A 12-count indictment was filed this afternoon in federal court in Brooklyn charging Orlando Lopez with travelling across a state line with intent to commit aggravated sexual abuse of a child, sexual exploitation of a child and possession of child pornography.
Richard P. Donoghue, United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), Melinda Katz, Queens County District Attorney, and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the charges.
“As alleged, for years Lopez horribly victimized numerous young children, some of whom we are still endeavoring to identify,” stated United States Attorney Donoghue. “In addition to his unthinkable abuse of these young children – many of them infants – Lopez compounded his atrocities by producing thousands of photos and videos of his crime and we pledge to prosecute him to the fullest extent.” Mr. Donoghue expressed his grateful appreciation to the Queens County District Attorney’s Office for their assistance with the case.
“The conduct alleged here is horrendous. Mr. Lopez allegedly used friendships with his victims' parents as a means to access children he wouldn't generally have contact with, which leads us to believe there are more victims out there. Readers should be stunned into action by an investigation like this,” stated FBI Assistant Director-in-Charge Sweeney. “We are asking anyone who has had any contact with Mr. Lopez at any point to call 1-800-CALL-FBI. Please take a moment to make this call. The ages and numbers of victims are another warning that we must do more as a society to protect our children.”
“The defendant charged in this Federal indictment is alleged to have violated numerous children for years – and additionally recorded and took still photos of these alleged vile acts,” stated Queens District Attorney Katz. “When I was a member of the Assembly, I authored legislation to hold pedophiles accountable for sexually abusing children. Child predators will be held accountable and prosecuted as we work with our law enforcement partners to end the abuse of innocent children.”
“This defendant is accused of preying on the most vulnerable members of our communities – our children. Together with the Unites States Attorney’s office, the FBI and Queens District Attorney’s office, our NYPD investigators worked relentlessly to bring justice for victims of sexual abuse and exploitation,” stated NYPD Commissioner Shea.
According to the indictment and other court filings, for over a decade, Lopez repeatedly sexually abused more than a dozen children, many of whom lived near his Queens residence. Between approximately May 2010 and June 2018, Lopez produced thousands of explicit photos and videos of one female child who was two years-old when the abuse began. Law enforcement also recovered thousands of other photos and videos from Lopez’s residence depicting him engaging in sexual activity with children. In July 2018, Lopez transported one seven-year-old girl across state lines with the intent to sexually abuse her. In order to gain access to his victims, Lopez attempted to befriend their parents.
The government’s investigation is ongoing. Anyone with information about sexual exploitation by Lopez is asked to contact the FBI at 1-800-CALL-FBI.
If convicted, Lopez faces a mandatory minimum sentence of 30 years and up to life in prison for the transportation charge, and a minimum of 15 years and up to 30 years in prison on each of the child exploitation charges.
The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty.
This prosecution is part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices, 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.
The government’s case is being prosecuted by Assistant United States Attorney Tanya Hajjar.
The Defendant:
ORLANDO LOPEZ
Age: 64
Jamaica, QueensE.D.N.Y. Criminal Docket No. 20-52 (EK)
Providence Man Charged with Trafficking Meth, Crack CocaineRead the Press Release
PROVIDENCE – A Providence man currently serving a term of state probation, having completed a sentence of eight years with 30 months to serve at the ACI for drug trafficking, today was ordered detained in federal custody following an investigation and his arrest by members of the FBI Safe Streets Gang Task Force into his alleged trafficking of crystal methamphetamine (meth) and crack cocaine.
Casimiro Pereira, 27, was arrested on Friday as Safe Streets Task Force members executed a federal court-authorized search of his Providence residence, where they allegedly seized, among other items, crystal meth.
It is alleged that on at least five occasions between July 25, 2019, and January 28, 2020, while under law enforcement surveillance, Pereira delivered varying amounts of crystal meth and crack cocaine in exchange for cash.
It is alleged that on July 25 and on August 15, 2019, Pereira sold 20 grams of crystal meth for $360, and that between October 1, 2019, and January 28, 2020, he allegedly delivered between 1.45 and 7 grams of crack cocaine for between $100 and $300.
Each alleged transaction was monitored by members of the FBI Safe Streets Gang Task Force. The drugs were quickly seized by members of law enforcement.
It is alleged that during Friday’s pre-dawn search of Pereira’s residence, agents and officers seized over 140 grams of crystal meth, 8 grams of crack cocaine, and various items used in the preparation, packaging, and distribution of crystal meth and crack cocaine.
Pereira, charged by way of a criminal complaint with distribution of 5 grams or more of crystal methamphetamine and distribution of cocaine base, made his initial appearance in U.S. District Court in Providence today before U.S. District Court Magistrate Judge Patricia A. Sullivan.
Pereira’s arrest and initial appearance are announced by United States Attorney Aaron L. Weisman and Special Agent in Charge of the FBI Boston Division Joseph R. Bonavolonta.
A federal criminal complaint is merely an accusation. A defendant is presumed innocent unless and until proven guilty.
The case is being prosecuted by Assistant United States Attorneys Christine D. Lowell and Sandra R. Hebert.
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Pennsylvania man sentenced for role in a drug distribution operationRead the Press Release
CLARKSBURG, WEST VIRGINIA – Armand Taylor, of Penn Hills, Pennsylvania, was sentenced today to 18 months incarceration for his role in a drug distribution operation, U.S. Attorney Bill Powell announced.
Taylor, also known as “Scrap,” age 26, pled guilty to one count of “Distribution of Heroin” in October 2019. Taylor admitted to selling heroin in June 2017 in Harrison County.
Assistant U.S. Attorney Zelda E. Wesley prosecuted the case on behalf of the government. The case was investigated by the Greater Harrison Drug and Violent Crimes Task Force and the West Virginia State Police Bureau of Criminal Investigation.
Senior U.S. District Judge Irene M. Keeley presided.Pen Yan Man Pleads Guilty to Falsifying Inspection Reports for Space PartsRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y.--U.S. Attorney James P. Kennedy, Jr. announced today that James Smalley, 42, of Penn Yan, NY, pleaded guilty before U.S. District Judge Elizabeth A. Wolford to falsifying inspection reports for space parts. The charge carries a maximum penalty of 15 years in prison and a $500,000 fine.
Assistant U.S. Attorney Richard A. Resnick, who is handling the case, stated that the defendant was a Quality Assurance Engineer at PMI Industries, LLC, a Rochester aerospace precision machining service, specializing in high-tolerance machining for flight critical aerospace parts used to build space flight vehicles by SpaceX and other Department of Defense aerospace contractors. Smalley began his employment at PMI on March 6, 2017, working on contracts for SpaceX, which developed the Falcon launch vehicle family and the Dragon spacecraft family. Falcon and Dragon both currently deliver payloads into Earth orbit for NASA, the Air Force, other United States government agencies and private industry. SQA Services, Inc. (SQA) is a subcontractor to SpaceX, and provides multiple quality assurance functions within the aerospace and defense manufacturing industries.
In January 2018, an internal audit by SQA Services, Inc. (SQA), at the direction of SpaceX, revealed multiple falsified source inspection reports and non-destructive testing (NDT) certifications from PMI Industries, LLC, for Falcon 9 and Falcon Heavy flight critical parts. SpaceX notified PMI of the anomalies. Source inspections and NDT are key tools used in the aerospace industry to ensure manufactured parts comply with quality and safety standards.Specifically, the signed source inspection report had a forged signature of the SQA inspector. SpaceX and SQA officials believed the signature of the inspector was photocopied and cut and pasted onto the source inspection report with a computer.
On February 16, 2018, the NASA Launch Services Program alerted the NASA Office of Inspector General (OIG), and Kennedy Space Center (KSC) Resident Agency, regarding the falsified source inspection reports and false NDT certifications created by PMI. Some of the false source inspection reports and false NDT certifications were related to space launch vehicle components that, at the time of discovery, were to be used for the upcoming Transiting Exoplanet Survey Satellite (TESS) mission, which launched from a SpaceX Falcon 9 rocket on April 18, 2018.
The investigation has identified that Smalley, while an employee of PMI, falsified at least 38 source inspection reports for space vehicle parts procured by SpaceX for the construction of the Falcon 9 and Falcon Heavy series of space vehicles. The investigation has also identified at least 76 individual piece parts that were rejected during source inspection or were never inspected by SQA, then subsequently shipped to SpaceX.
A records request from SpaceX identified seven NASA space flight missions, two United States Air Force space flight missions, and one National Oceanic and Atmospheric Administration (NOAA) space flight mission that were affected by parts purchased by SpaceX from PMI.
Subsequently, SpaceX terminated its business relationship with PMI averaged approximately $200,000 per month from the business with SpaceX, as a disqualified supplier. PMI subsequently closed its operation.
“With space representing our nation’s next frontier, my office will remain vigilant to ensure that American ingenuity does not fall victim to indolence,” noted U.S. Attorney Kennedy. “Failure to comply with quality control measures undermines the integrity of essential equipment and technology.”
The plea is the result of an investigation by the NASA Office of Inspector General, under the direction of Special Agent-in-Charge John Corbett, Central Field Office; the Air Force Office of Special Investigations, under the direction of Special Agent-in-Charge Wendell W. Palmer, Office of Procurement Fraud; and the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Gary Loeffert.
Sentencing is scheduled for May 13, 2020, at 2:00 p.m. before Judge Wolford.
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Owners of Greensboro Temporary Staffing Firms Plead Guilty to Employment Tax FraudRead the Press Release
WASHINGTON – Two Greensboro, North Carolina, business owners pleaded guilty today to failing to pay over employment taxes to the Internal Revenue Service (IRS), announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina.
According to documents and information provided to the court, Rebecca Adams, 57, and her daughter Elizabeth Wood, 40, operated a temporary staffing business in Greensboro that changed names twice, even though it did not otherwise change its actual business operations. Adams and Wood withheld taxes from employees’ paychecks but did not pay those taxes over to the IRS.
In 2015, Wood began serving a criminal sentence in North Carolina after pleading guilty to embezzling employee state tax withholdings that were due to the State. During Wood’s period of incarceration, her mother, Adams, withheld taxes from employees’ paychecks, but did not pay those taxes over to the IRS. Adams also did not file the required quarterly payroll tax return. Upon being released from prison in 2015, Wood resumed her role at the staffing business and continued to withhold taxes from employees’ paychecks, but again did not pay the taxes over to the IRS.
U.S. Senior District Judge N. Carlton Tilley Jr., scheduled Adams’s sentencing for May 22, 2020, and Wood’s sentencing for May 29, 2020. They each face a statutory maximum sentence of five years in prison, as well as a period of supervised release and monetary penalties. As part of their plea agreements, the defendants have agreed to pay restitution to the IRS.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin thanked agents of IRS-Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorney Frank Chut and Trial Attorney Kevin Schneider of the Tax Division, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the Division’s website.
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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Owners of Greensboro Temporary Staffing Firms Plead Guilty to Employment Tax FraudRead the Press Release
Two Greensboro, North Carolina, business owners pleaded guilty today to failing to pay over employment taxes to the Internal Revenue Service (IRS), announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina.
According to documents and information provided to the court, Rebecca Adams, 57, and her daughter Elizabeth Wood, 40, operated a temporary staffing business in Greensboro that changed names twice, even though it did not otherwise change its actual business operations. Adams and Wood withheld taxes from employees’ paychecks but did not pay those taxes over to the IRS.
In 2015, Wood began serving a criminal sentence in North Carolina after pleading guilty to embezzling employee state tax withholdings that were due to the State. During Wood’s period of incarceration, her mother, Adams, withheld taxes from employees’ paychecks, but did not pay those taxes over to the IRS. Adams also did not file the required quarterly payroll tax return. Upon being released from prison in 2015, Wood resumed her role at the staffing business and continued to withhold taxes from employees’ paychecks, but again did not pay the taxes over to the IRS.
U.S. Senior District Judge N. Carlton Tilley Jr., scheduled Adams’s sentencing for May 22, 2020, and Wood’s sentencing for May 29, 2020. They each face a statutory maximum sentence of five years in prison, as well as a period of supervised release and monetary penalties. As part of their plea agreements, the defendants have agreed to pay restitution to the IRS.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin thanked agents of IRS-Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorney Frank Chut and Trial Attorney Kevin Schneider of the Tax Division, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the Division’s website.
Notification Advisory for Victims Affected by Bukoski’s Dos-For-Hire Booter ServiceRead the Press Release
Anchorage, Alaska – U.S. Attorney Bryan Schroder announced that David Bukoski, 24, of Hanover Township, Pennsylvania, was recently sentenced for operating a long-running Denial of Service (DoS) for-hire service, known as Quantum Stress, which allowed paying users to conduct wide-ranging attacks on individual and corporate victim domains and networks, preventing them from being able to access the internet. In August 2019, Bukoski pleaded guilty as charged for aiding and abetting computer intrusions, and he was sentenced for his conduct on Feb. 4, 2020.
Due to the large number of potential victims in this case, Chief U.S. District Judge Timothy M. Burgess issued an order directing the government to employ alternative victim notification procedures so that any member of the community at large who believes they may be a crime victim is made aware of their potential rights.
The government is asking that members of the community who believe they may be a victim of Bukoski’s criminal activities, to please contact (907) 271-3041 to reach the Victim-Witness Unit at the U.S. Attorney’s Office, District of Alaska.
The victim-witness program of the U.S. Attorney’s Office, District of Alaska, provides information, services, and support to individuals during federal prosecutions. Case updates will be provided on the U.S. Attorney’s Office, District of Alaska website at https://www.justice.gov/usao-ak/case-updates. A restitution hearing in this case is scheduled for May 5, 2020, at 10:30 A.M. in Anchorage.
According to public court filings, Bukoski became the subject of a federal investigation when FBI agents began investigating individuals in the United States and abroad operating what were suspected to be the longest running and most prevalent DoS-for-hire services. These websites, which offered what are often called “booter” or “stresser” services, are a mechanism by which criminals can manipulate (in most cases stolen) bandwidth and architecture for the purpose of damaging the targeted victim’s access to the internet by flooding them with internet traffic with the intent of causing damage or financial loss. The FBI’s investigation ultimately identified Bukoski as one of the individuals operating and profiting from one of these booter services under the domain “quantumstress.net.”
The investigation revealed that Bukoski made a number of different subscription plans available to his approximately 70-80,000 subscribers between 2011 and 2018, all of which entailed payment by the subscriber in exchange for some period of access to attack infrastructure controlled by Bukoski. It was further revealed that Bukoski’s booter service had been used both by individuals outside of Alaska to attack Alaskan victims, as well as individuals in Alaska to attack others outside.
This case was the product of an investigation conducted by the FBI’s Anchorage Field Office and the FBI’s Cyber Initiative and Resource Fusion Unit (CIRFU). The case against Bukoski was prosecuted by Assistant U.S. Attorney Adam Alexander of the U.S. Attorney’s Office for the District of Alaska.
Northwest Arkansas Man and Woman Sentenced to More Than 10 Years Combined in Federal Prison for Drug TraffickingRead the Press Release
Fayetteville, Arkansas – David Clay Fowlkes, Acting United States Attorney for the Western District of Arkansas announced that Matthew Barnes, age 29, from Bentonville, Arkansas was sentenced to 77 months imprisonment followed by 3 years supervised release and Sonia Werline, age 24, from Fayetteville, Arkansas was sentenced to 51 months followed by 3 years supervised release for Aiding and Abetting in the Possession of More Than 50 Grams of Methamphetamine with Intent to Distribute. The Honorable Timothy L. Brooks presided over the sentencing hearings in the United States District Court in Fayetteville.
According to court records, narcotics investigators encountered Barnes and Werline at a Fayetteville motel and questioned them regarding suspected drug trafficking. After Barnes and Werline admitted to possessing a large quantity of methamphetamine, investigators located approximately one kilogram of methamphetamine under the sink.
The methamphetamine was subsequently sent to the DEA crime lab in Miami, Florida where it was found to contain 977 grams of actual methamphetamine.
Barnes and Werline were indicted by a federal grand jury in June of 2019 and entered guilty pleas in September of 2019.
This case was investigated by the Fourth Judicial Drug Task Force, the Drug Enforcement Administration and the Washington County Sheriff’s Office. Assistant United States Attorney Amy Driver prosecuted the case for the United States.
North Suburban Man Pleads Guilty to Orchestrating $9.6 Million Fraud SchemeRead the Press Release
CHICAGO — A north suburban man pleaded guilty today to federal fraud and tax offenses in connection with a $9.6 million fraud scheme.
ROBERT GORODETSKY, 27, of Northbrook, pleaded guilty to one count of wire fraud and one count of filing a false tax return. U.S. District Judge Elaine E. Bucklo set sentencing for April 29, 2020.
The guilty plea was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Kathy A. Enstrom, Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago; and Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI. The government is represented by Assistant U.S. Attorney Patrick J. King, Jr.
Gorodetsky admitted in a plea agreement that from 2014 to 2018 he schemed to defraud an individual of approximately $9.6 million in connection with purported stock market investments and wagers on sporting events. Gorodetsky represented himself as a successful “day trader” who would invest the individual’s money in the stock market and share in the profits, the plea agreement states. After initially obtaining approximately $953,000 from the individual, Gorodetsky invested only $215,000 of it and pocketed the rest for his personal use, the plea agreement states.
Gorodetsky later falsely told the individual that his investments had increased to $2 million, and that the purported gains should be put toward sports wagers, according to the plea agreement. Gorodetsky induced the individual to invest approximately $8.74 million of additional funds to wager on sports. Gorodetsky used much of this money for purposes unrelated to sports wagering, including personal expenditures such as living expenses, travel and entertainment costs, and luxury automobiles and jewelry, the plea agreement states. In all, Gorodetsky’s fraud scheme resulted in a loss to the individual of approximately $7.1 million.
The tax offense pertains to Gorodetsky’s failure to report the money he received from the individual as income on his tax returns, resulting in an approximate tax loss of more than $2.65 million.
Wire fraud is punishable by up to 20 years in prison, while the tax charge carries a maximum sentence of three years. The Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.
Norfolk Man Pleads Guilty to First Degree Murder in Indian CountryRead the Press Release
United States Attorney Joe Kelly announced that Joseph Lloyd James, 48, of Norfolk, entered a plea of guilty today in federal court in Omaha to First Degree Murder in Indian Country. James murdered Phyllis Hunhoff, of Yankton, South Dakota, on the Santee Sioux Indian Reservation in Nebraska. United States District Court Judge Brian C. Buescher ordered a presentence investigation report and set sentencing for May 6, 2020 at 10 a.m. in Omaha. James’s plea agreement mandates a life sentence. As part of his plea agreement, he waives his right to appeal, to seek a pardon, or commutation.
Phyllis Hunhoff regularly traveled from her home in Yankton to her mother’s home in Utica, South Dakota. Her regular practice was to call her mother upon returning to Yankton. On November 4, 2018, at approximately 10 p.m., Phyllis Hunhoff left her mother’s residence, alone, to drive home to Yankton. She did not call her mother as she did not make it home. Having not heard from her daughter, her mother began repeatedly calling her phone to determine her whereabouts. All calls were unanswered.
James and other men were near Phyllis Hunhoff’s mother’s residence as she was leaving. James and another man encountered Phyllis Hunhoff outside of the residence and got into her car with her inside. James, Phyllis Hunhoff, and another man traveled to Norfolk, Nebraska, arriving at about 11:00 p.m. When they arrived in Norfolk, James remained in the vehicle, and the other man left the vehicle. James drove Phyllis Hunhoff’s vehicle, with her inside, to the Santee Sioux Indian Reservation in Knox County, Nebraska.
During the early morning hours of November 5, 2018, while on the Santee Sioux Indian Reservation, James killed Phyllis Hunhoff. He stabbed her with a knife and strangled her. She died in her vehicle as a result of the bleeding and strangulation. James drove Phyllis Hunhoff’s vehicle to a gas station on the Santee Sioux Indian Reservation. Video from the gas station showed James putting gasoline into her vehicle and driving away. Later, James returned in the same vehicle to the gas station and pumped gasoline into a soda bottle. James put the bottle containing the gasoline into the vehicle. He then drove to a wooded location on the Santee Sioux Indian Reservation in Knox County, Nebraska, where he set fire to Hunhoff’s body and her vehicle to conceal evidence of the murder. He abandoned the body and vehicle and left the area.
Law enforcement officers investigated the murder and obtained evidence, including surveillance footage of James at the gas station during the early morning hours of November 5, 2018. Santee Police recovered the shirt James was wearing when he killed Phyllis Hunhoff from a trash receptacle. Her DNA was on James’ shirt. James’s DNA was on clothing Phyllis Hunhoff was wearing when he killed her.
United States Attorney Joe Kelly expressed his appreciation for the hard work and cooperation of multiple law enforcement agencies in both Nebraska and South Dakota. “The quick and thorough work of these agencies, coupled thereafter with the acquisition of digital evidence, resulted in holding James accountable for this horrific crime and tragic loss for the Hunhoff family,” said USA Kelly.
FBI Special Agent in Charge Kristi Johnson added, “The FBI’s partnership with the Santee Sioux Nation Tribal Police, Knox County Sheriff, and Nebraska State Patrol were vital to the success of this investigation. So long as our Native American partners face terrible crimes like this on reservation land, the FBI stands ready to work alongside them as we together seek justice for all.”
The case was investigated by the Federal Bureau of Investigation, the Nebraska State Patrol, Knox County Sheriff’s Office, Santee Sioux Nation Tribal Police, Yankton County Sheriff’s Office, Yankton Police Department (South Dakota), Norfolk Police Department, the University of Nebraska Medical Center, the Nebraska State Fire Marshal, and the Lincoln Police Department.
New Haven Crack Dealer Sentenced to 4 Years in Federal PrisonRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that TYRESE HARGROVE, also known as “T.Y.,” 38, of New Haven, was sentenced today by U.S. District Judge Vanessa L. Bryant in Hartford to 48 months of imprisonment, followed by five years of supervised release, for his role in a New Haven drug trafficking ring.
According to court documents and statements made in court, in June 2017, the FBI’s New Haven Safe Streets/Gang Task Force initiated an investigation into a New Haven drug trafficking organization headed by Jermayne Butler. The investigation, which included physical surveillance, 13 controlled purchases of narcotics, and court-authorized wiretaps on multiple phones, revealed that members of the organization were distributing crack cocaine and oxycodone in the New Haven area.
Hargrove purchased distribution quantities of crack cocaine from Butler and then sold the drug in smaller quantities to his own customers. During the investigation, law enforcement made four controlled purchases of crack from Hargrove.
On February 8, 2018, a grand jury in New Haven returned a 30-count indictment charging Hargrove, Butler and 17 other individuals with various offenses. Hargrove pleaded guilty on November 16, 2018.
Butler pleaded guilty on August 9, 2019, and awaits sentencing.
This matter is being investigated by the FBI’s New Haven Safe Streets/Gang Task Force, which includes members from the New Haven Police Department, Milford Police Department, West Haven Police Department and Connecticut Department of Correction. The case is being prosecuted by Assistant U.S. Attorneys Patrick F. Caruso and David C. Nelson.
Multiple-Time Convicted Felon Who Had Violent Encounter with Law Enforcement Admits Possessing Cocaine, Oxycodone, and A FirearmRead the Press Release
NEWARK, N.J. – A Union County, New Jersey man who was previously convicted of several felonies admitted that he possessed and intended to distribute drugs and that he possessed a handgun to aid his drug distribution, U.S. Attorney Craig Carpenito announced today.
Arthur Forman, 37, pleaded guilty on Feb. 4, 2020 to a Superseding Information charging him with possession with the intent to distribute cocaine and oxycodone, possession of a firearm in the course of committing that drug crime, and being a previously convicted felon in possession of a firearm. Forman entered his plea before United States District Judge Katharine S. Hayden in Newark federal court.
According to documents filed in this case and statements made in court:
During an encounter with the Plainfield, NJ police Department on October 13, 2017, Forman resisted arrest by violently choking a Plainfield detective. While trying to evade capture, Forman transferred a bag containing the cocaine and firearm to a family member, who attempted to dispose of the bag and its contents by throwing it out a window. During a subsequent search of Forman’s bedroom, Plainfield police officers found numerous oxycodone pills and paraphernalia used to grind pills and package drugs for sale. Forman today acknowledged that he possessed the drugs and gun. Forman also acknowledged that he was previously convicted in 2016 in Union County, New Jersey of resisting arrest and eluding, a felony under New Jersey state law.
The combined charges are punishable by a maximum sentence of 30 years to life in prison.
U.S. Attorney Carpenito credited the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the leadership of Special Agent in Charge Charlie J. Patterson; the Plainfield Police Division, under the leadership of Police Director Lisa Burgess; and the Union County Prosecutor’s Office, under the direction of Acting Prosecutor Lyndsay V. Ruotolo, with the investigation leading to the guilty plea.
The government is represented by Assistant U.S. Attorneys Joshua L. Haber and Desiree Grace Latzer of the U.S. Attorney’s Office Criminal Division in Newark.
Defense counsel: James Lisa, Esq., Jersey City, NJ
Multiple Life Sentences Handed Down in Bradenton Gang Racketeering and Murder CaseRead the Press Release
Tampa, Florida – U.S. District Judge William F. Jung today sentenced Jordan Rodriguez (Bradenton, 26) to, among other things, three terms of life imprisonment. Rodriguez’s co-defendants, Alfonzo Churchwell (Bradenton, 32) and Andrew Thompson (Bradenton, 25) were also sentenced to multiple life terms of imprisonment last month. All three individuals were found guilty on November 5, 2019, following a three-and-a-half-week jury trial. See
summary chart for a complete list of charges and sentences.According to evidence presented during the trial, the defendants were engaged in a violent and deadly rivalry with others in Oneco, a community in Bradenton. The men worked together to traffic in controlled substances and to control and protect their drug business with violence and murder. Rodriguez, Churchwell, and Thompson were responsible for at least four murders. Their racketeering enterprise maintained a “trap house” that was used to distribute heroin, cocaine, crack cocaine, marijuana, and other drugs.
“Our thoughts and prayers remain with the families of the murdered victims,” stated U.S. Attorney Maria Chapa Lopez. “We are deeply committed to dismantling violent criminal organizations.” “The Department of Justice, working closely with our partners at all levels of law enforcement, will continue to use every available resource to protect vulnerable communities from the scourge of violent drug crime.
“The announcement of these sentences means that these individuals will no longer be able to hurt, harm or intimidate this community,” said ATF Special Agent in Charge Daryl McCrary. “ATF has worked extensively with the Manatee County Sheriff’s Office to reduce violent crime and also with the victims’ families to bring closure to those who have suffered through these senseless acts of violence.”
Manatee County Sheriff Rick Wells said, “Our goal has always been to find violent drug traffickers who are destroying lives in our community, and hold them accountable. We appreciate the hard work of the United States Attorney’s Office for bringing this case to a successful conclusion.”
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Manatee County Sheriff’s Office, and the State Attorney’s Office (Twelfth Judicial Circuit). It was prosecuted by Assistant United States Attorneys Natalie Hirt Adams and Christopher F. Murray.
Montana Broker Found Guilty in Multimillion-Dollar Fraud SchemeRead the Press Release
A federal jury found a Montana man guilty yesterday for his role as a broker for a Swiss company involved in a multimillion-dollar international fraud scheme.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Nicholas A. Trutanich of the District of Nevada and Special Agent in Charge Aaron C. Rouse of the FBI’s Las Vegas Field Office made the announcement.
Following a five-day trial, Sean Finn, 51, of Whitefish, Montana, was found guilty of one count of conspiracy to commit wire fraud and securities fraud, four counts of wire fraud and four counts of securities fraud. He was acquitted of one count of wire fraud. Sentencing has been scheduled for May 12, 2020, before U.S. District Judge Kent J. Dawson of the District of Nevada, who presided over the trial.
According to the evidence presented at trial, Finn conspired with others in the United States and Switzerland to promote investments and loan instruments that he knew to be fictitious. Finn and his co-conspirators told victims that, for an up-front payment ranging from $100,000 to $1 million, a Swiss company known as Malom Group AG (Malom), whose name stood for “Make A Lot Of Money,” would provide access to lucrative investment opportunities and substantial cash loans. The evidence showed that to effectuate this scheme, the defendant and his co-conspirators provided victims with fabricated bank documents purporting to show that Malom held hundreds of millions of dollars in overseas bank accounts, as well as documents falsely stating that Malom had previously closed similar deals. The evidence showed that when victims wired their money into an escrow account controlled by the co-conspirators, the money was released and disbursed to, among others, Finn for his own personal use. The evidence further showed that shortly before he was indicted in 2013, Finn fled to Canada, where he was arrested in 2014 and ultimately extradited back to the United States in 2018. According to the evidence presented at trial, losses to the victims from the scheme totaled approximately $4 million.
Finn was charged together with five other defendants. Two of these defendants, Anthony Brandel and James Warras, were found guilty of conspiracy and multiple counts of wire fraud and securities fraud following a jury trial in 2015. Brandel and Warras were each sentenced to 87 months in prison, followed by three years of supervised release, on Aug. 3, 2016. A third defendant, Joseph Micelli, pleaded guilty to conspiracy to commit wire fraud and securities fraud in 2015 and was sentenced to 60 months in prison, followed by three years of supervised release, on Feb. 23, 2016. The other two defendants, Martin Schlaepfer and Hans-Jurg Lips, remain at large outside the United States. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The FBI’s Las Vegas Field Office investigated the case. Assistant Deputy Chief Anna G. Kaminska and Trial Attorney Blake C. Goebel of the Criminal Division’s Fraud Section prosecuted the case with assistance from the Criminal Division’s Office of International Affairs and the U.S. Attorney’s Office for the District of Nevada. Deputy Chief Brian Young of the Fraud Section previously handled the prosecution. The Securities and Exchange Commission’s Enforcement Division, which conducted a parallel civil-enforcement investigation, as well as the Royal Canadian Mounted Police, also provided valuable assistance.
The Criminal Division’s Fraud Section plays a pivotal role in the Department of Justice’s fight against white-collar crime around the country.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Montana Broker Found Guilty in Multimillion Dollar Fraud SchemeRead the Press Release
LAS VEGAS, Nev. – A federal jury found a Montana man guilty Tuesday for his role as a broker for a Swiss company involved in a multimillion-dollar international fraud scheme.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Nicholas A. Trutanich of the District of Nevada and Special Agent in Charge Aaron C. Rouse of the FBI’s Las Vegas Field Office made the announcement.
Following a five-day trial, Sean Finn, 51, of Whitefish, Montana, was found guilty of one count of conspiracy to commit wire fraud and securities fraud, four counts of wire fraud and four counts of securities fraud. He was acquitted of one count of wire fraud. Sentencing has been scheduled for May 12, 2020, before U.S. District Judge Kent J. Dawson of the District of Nevada, who presided over the trial.
According to the evidence presented at trial, Finn conspired with others in the United States and Switzerland to promote investments and loan instruments that he knew to be fictitious. Finn and his co-conspirators told victims that, for an up-front payment ranging from $100,000 to $1 million, a Swiss company known as Malom Group AG (Malom), whose name stood for “Make A Lot Of Money,” would provide access to lucrative investment opportunities and substantial cash loans. The evidence showed that to effectuate this scheme, the defendant and his co-conspirators provided victims with fabricated bank documents purporting to show that Malom held hundreds of millions of dollars in overseas bank accounts, as well as documents falsely stating that Malom had previously closed similar deals. The evidence showed that when victims wired their money into an escrow account controlled by the co-conspirators, the money was released and disbursed to, among others, Finn for his own personal use. The evidence further showed that shortly before he was indicted in 2013, Finn fled to Canada, where he was arrested in 2014 and ultimately extradited back to the United States in 2018. According to the evidence presented at trial, losses to the victims from the scheme totaled approximately $4 million.
Finn was charged together with five other defendants. Two of these defendants, Anthony Brandel and James Warras, were found guilty of conspiracy and multiple counts of wire fraud and securities fraud following a jury trial in 2015. Brandel and Warras were each sentenced to 87 months in prison, followed by three years of supervised release, on Aug. 3, 2016. A third defendant, Joseph Micelli, pleaded guilty to conspiracy to commit wire fraud and securities fraud in 2015 and was sentenced to 60 months in prison, followed by three years of supervised release, on Feb. 23, 2016. The other two defendants, Martin Schlaepfer and Hans-Jurg Lips, remain at large outside the United States. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The FBI’s Las Vegas Field Office investigated the case. Assistant Deputy Chief Anna G. Kaminska and Trial Attorney Blake C. Goebel of the Criminal Division’s Fraud Section prosecuted the case with assistance from the Criminal Division’s Office of International Affairs and the U.S. Attorney’s Office for the District of Nevada. Deputy Chief Brian Young of the Fraud Section previously handled the prosecution. The Securities and Exchange Commission’s Enforcement Division, which conducted a parallel civil-enforcement investigation, as well as the Royal Canadian Mounted Police, also provided valuable assistance.
The Criminal Division’s Fraud Section plays a pivotal role in the Department of Justice’s fight against white-collar crime around the country.
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Monroeville Man Admits Guilt in Marriage Fraud SchemeRead the Press Release
PITTSBURGH, PA - A resident of Monroeville pleaded guilty in federal court on Monday to conspiracy to commit marriage fraud, United States Attorney Scott W. Brady announced today.
Makhan Singh, 53, pleaded guilty to one count before United States District Judge Arthur J. Schwab.
In connection with the guilty plea, the court was advised that from in and around 2011 through in and around October of 2018, Makhan Singh conspired with his brother Rajinder Singh, and United States citizen Dawn Haroulakis, to knowingly facilitate or enter into a marriage for the purpose of evading the immigration laws. The court was further advised that Makhan Singh offered to pay Ms. Haroulakis if she would marry his brother, Rajinder Singh, so that Rajinder, a native and citizen of India, could obtain legal permanent residency in the United States. Ms. Haroulakis agreed to the sham marriage, and Makhan Singh then made payments of more than $15,000 to Ms. Haroulakis in exchange for her marriage to Rajinder Singh.
Judge Schwab scheduled sentencing for August 6, 2020. The law provides for a total sentence of five years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant. The defendant remains on bond pending sentencing.
Assistant United States Attorney Christy C. Wiegand is prosecuting this case on behalf of the government.
The Department of Homeland Security, Immigration and Customs Enforcement conducted the investigation that led to the prosecution of Singh, in connection with the Pittsburgh Document and Benefit Fraud Task Force (DBFTF). The DBFTF is a multi-agency partnership established to focus on high-impact criminal investigations involving the use of fraudulent documents in furtherance of immigrations benefit applications and petitions, financial fraud, criminal work-site enforcement, and public benefits fraud. The Pittsburgh DBFTF consists of the following agencies: Homeland Security Investigations, US Citizenship and Immigration Services, the Social Security Administration-Office of the Inspector General, the Internal Revenue Service-Criminal Investigations, US Department of State-Diplomatic Security Service, US Department of Agriculture- Office of the Inspector General, US Department of Labor- Office of the Inspector General, and the Pennsylvania Office of the Attorney General.
Missouri Businessman Arrested on Antitrust Charge for Rigging Bids at Online Government AuctionsRead the Press Release
A federal grand jury returned an indictment charging Alan Gaines, a Missouri resident, with participating in a conspiracy to rig bids submitted to the General Services Administration (GSA) at online auctions for surplus government equipment, the Department of Justice announced.
According to the indictment filed in the U.S. District Court in Minneapolis, Gaines conspired to rig bids at public online GSA auctions of surplus government equipment from about July 2012 until as late as May 2018. Gaines is the third individual charged in this investigation. Two co-conspirators, Marshall Holland and Igor Yurkovetsky, previously pleaded guilty in the investigation.
“Rigging bids at government auctions cheats taxpayers out of the benefits of competition and steals from the public purse,” said Assistant Attorney General Makan Delrahim of the Department of Justice. “This indictment affirms the Division’s commitment to safeguarding online markets and holding to account individuals who rig bids.”
“The general public deserves a level playing field when doing business with the government,” said GSA Inspector General Carol Ochoa. “GSA OIG is committed to prosecuting individuals who corrupt the system put in place for fair and competitive bidding.”
The GSA operates GSA Auctions, which offers the general public the opportunity to bid electronically on a wide variety of federal assets, including computer equipment that is no longer needed by government agencies. GSA Auctions sells that equipment via its online auctions, and the proceeds of the auctions are distributed to the government agencies or the U.S. Treasury general fund. According to the charge, the primary purpose of the conspiracy was to suppress and eliminate competition. Additionally, the co-conspirators obtained the equipment by agreeing which co-conspirators would submit bids for particular lots offered for sale by GSA Auctions and which co-conspirator would be designated to win a particular lot.
Gaines is charged with violating the Sherman Act, which carries a maximum penalty of 10 years in prison and a $1 million criminal fine for individuals. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine. An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt.
The ongoing investigation into bid rigging at GSA auctions is being conducted by the Antitrust Division’s Chicago Office and the GSA Office of Inspector General’s Great Lakes Regional Investigations Office in Chicago, Illinois. Anyone with information concerning bid rigging or fraud related to GSA auctions should contact the Chicago Office of the Antitrust Division at 312-984-7200, the Antitrust Division’s Citizen Complaint Center at 888-647-3258, visit http://www.justice.gov/atr/report-violations or email the GSA Office of Inspector General at [email protected].
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Mishawaka, Indiana Man Sentenced to 120 Months in PrisonRead the Press Release
SOUTH BEND - Kenneth Sanders, age 39, of Mishawaka, Indiana was sentenced before South Bend District Court Judge Jon E. DeGuilio for conspiracy to distribute over 500 grams of a mixture or substance containing methamphetamine and over 100 grams of a mixture or substance containing heroin, announced U.S. Attorney Kirsch
Mr. Sanders was sentenced to 120 months in prison followed by 5 years of supervised release.
According to documents in this case, between October and November of 2018, Mr. Sanders along with other individuals conspired to distribute methamphetamine out of a home located in South Bend, Indiana. In November, law enforcement executed a search warrant in South Bend where they found over four pounds of methamphetamine, money which had been used to buy drugs that same day from Mr. Sanders, along with Mr. Sanders and another person. Mr. Sanders has twice been convicted of felonies, one of which involved violence. Mr. Sanders admitted to knowing that methamphetamine was an illegal substance as well his role in the distribution of methamphetamine.
This case was investigated by the Drug Enforcement Administration and the Bureau of Alcohol, Tobacco, Firearms and Explosives with the assistance of the Michigan City Police Department, the LaPorte County Drug Task Force, and the Indiana State Police. The case was handled by Assistant U.S. Attorney Frank Schaffer.
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Michigan man sentenced to prison, ordered to pay $208,718 restitution in cryptocurrency scamRead the Press Release
MISSOULA—A Michigan man who admitted defrauding two Missoula persons in a cryptocurrency scam was sentenced today to one year and one day in prison followed by three years of supervised release and ordered to pay $208,718 restitution, U.S. Attorney Kurt Alme said.
James Matthew Thomas, 35, of Midland, MI, pleaded guilty in October to wire fraud and money laundering.
U.S. District Judge Donald W. Molloy presided.
The prosecution said in court documents filed in the case that the evidence showed Thomas contacted Victim 1, who lives in Missoula, through LinkedIn in March 2018. The two had met several years earlier while working together on the east coast. Thomas asked Victim 1 if he wanted to invest in cryptocurrency for a few days with a rate of return of 30 to 40 percent. Thomas said he worked with CoinPoint, an internet advertising company that pushed people to participating company websites, and that CoinPoint was looking for investors.
Victim 1 sent Thomas $6,948 worth of virtual currency. A few days later, Thomas sent the victim $9,203 worth of virtual currency, which was about a 30 percent return on the victim’s investment. Based on the return, Victim 1 talked with a second victim and some of his friends and family members. The second victim invested $185,000 with Thomas and the friends and family members agreed to contribute another $500,000.
Much of the money taken in from Victim 1’s friends and family was never converted to virtual currency or forwarded to Thomas. When Victim 1 realized Thomas was scamming him, he was able to return most of that money.
As the scam progressed, Thomas told Victim 1 the investments were doing well and that he was getting rich. Victim 1 asked to be included on communications with CoinPoint and started receiving emails from various purported CoinPoint employees.
The FBI later determined the email addresses were fake and associated with another domain name – coinpointpartners.net – that was not associated with the real CoinPoint. Investigators also determined that Thomas had registered the fake domain name, coinpointpartners.net, the day after Victim 1 asked to be included in communications.
When Victim 1 tried to remove some money from the CoinPoint investment because it was doing so well, he encountered delays and various explanations. Victim 1 independently contacted CoinPoint and received information that led him to believe he had likely been scammed by Thomas.
The FBI interviewed CoinPoint’s owner, who said the company had never worked with Thomas or Victim 1.
As part of scam, Thomas used investment proceeds from the victims to buy a vehicle in New Jersey for $10,245.
Assistant U.S. Attorney Tim Racicot prosecuted the case, which was investigated by the FBI.
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Martinsburg woman admits to role in cocaine, heroin, and fentanyl distribution operationRead the Press Release
MARTINSBURG, WEST VIRGINIA – Devale Montray Jackson, of Martinsburg, West Virginia, has admitted to his role in a cocaine, heroin, and fentanyl distribution operation, U.S. Attorney Bill Powell announced.
Jackson, age 58, pled guilty to one count of “Unlawful Use of Communication Facility.” Jackson admitted to using a phone to arrange a heroin sale in Berkeley County in December 2018.
Jackson is facing up to four years incarceration and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Lara K. Omps-Botteicher, Special Assistant U.S. Attorney C. Lydia Lehman, also with the Berkeley County Prosecuting Attorney’s Office, and Assistant U.S Attorney Timothy D. Helman, are prosecuting the case on behalf of the government. The Federal Bureau of Investigation; the West Virginia State Police; the Eastern Panhandle Drug & Violent Crimes Task Force, a HIDTA-funded initiative; the Berkeley County Prosecuting Attorney’s Office, the Berkeley County Sheriff’s Office, the Jefferson County Sheriff’s Office, the Martinsburg Police Department, the Charles Town Police Department, and the Ranson Police Department investigated.
The investigation was funded by the federal Organized Crime Drug Enforcement Task Force Program (OCDETF). The OCDETF program supplies critical federal funding and coordination that allows federal and state agencies to work together to successfully identify, investigate, and prosecute major interstate and international drug trafficking organizations and other criminal enterprises.
U.S. Magistrate Judge Robert W. Trumble presided.
Man Sentenced for Medicaid Fraud Scheme Related to Child AbuseRead the Press Release
NORFOLK, Va. – A Hampton man was sentenced today to over four years in prison for defrauding Medicaid out of approximately $109,000.
According to court documents, Maurice Moody, 41, and Dena Major, 49, conspired to defraud the Virginia Medicaid program out of approximately $109,000 by submitting fraudulent claims to Medicaid for their severely disabled son’s care, which he was eligible to receive. Major was the child’s primary caregiver and under Medicaid rules, she was also in charge of hiring a personal care aide to help in his care. Despite knowing that Medicaid does not permit the hiring of a parent to be a personal care aide, Major hired Moody to be their child’s personal care aide and falsely stated that Moody was the child’s uncle.
Moody also submitted claims for personal care hours provided to his son when Moody was incarcerated, and when he was out of the area traveling. In September 2015, the child was removed from Major’s custody on allegations of abuse and neglect. Nonetheless, Moody and Major continued to bill Medicaid for his care from September 2015 to April 2016. When challenged, the pair attempted to use another minor and pass him off as their child with the Medicaid service facilitator.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Martin Culbreth, Special Agent in Charge of the FBI’s Norfolk Field Office, made the announcement after sentencing by Chief U.S. District Judge Mark S. Davis. Assistant U.S. Attorney Joseph L. Kosky prosecuted the case. The Virginia Medicaid Fraud Control Unit assisted in the investigation.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:19-cr-033.
Montana Broker Found Guilty in Multimillion-Dollar Fraud SchemeRead the Press Release
WASHINGTON – A federal jury found a Montana man guilty yesterday for his role as a broker for a Swiss company involved in a multimillion-dollar international fraud scheme.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Nicholas A. Trutanich of the District of Nevada and Special Agent in Charge Aaron C. Rouse of the FBI’s Las Vegas Field Office made the announcement.
Following a five-day trial, Sean Finn, 51, of Whitefish, Montana, was found guilty of one count of conspiracy to commit wire fraud and securities fraud, four counts of wire fraud and four counts of securities fraud. He was acquitted of one count of wire fraud. Sentencing has been scheduled for May 12, 2020, before U.S. District Judge Kent J. Dawson of the District of Nevada, who presided over the trial.
According to the evidence presented at trial, Finn conspired with others in the United States and Switzerland to promote investments and loan instruments that he knew to be fictitious. Finn and his co-conspirators told victims that, for an up-front payment ranging from $100,000 to $1 million, a Swiss company known as Malom Group AG (Malom), whose name stood for “Make A Lot Of Money,” would provide access to lucrative investment opportunities and substantial cash loans. The evidence showed that to effectuate this scheme, the defendant and his co-conspirators provided victims with fabricated bank documents purporting to show that Malom held hundreds of millions of dollars in overseas bank accounts, as well as documents falsely stating that Malom had previously closed similar deals. The evidence showed that when victims wired their money into an escrow account controlled by the co-conspirators, the money was released and disbursed to, among others, Finn for his own personal use. The evidence further showed that shortly before he was indicted in 2013, Finn fled to Canada, where he was arrested in 2014 and ultimately extradited back to the United States in 2018. According to the evidence presented at trial, losses to the victims from the scheme totaled approximately $4 million.
Finn was charged together with five other defendants. Two of these defendants, Anthony Brandel and James Warras, were found guilty of conspiracy and multiple counts of wire fraud and securities fraud following a jury trial in 2015. Brandel and Warras were each sentenced to 87 months in prison, followed by three years of supervised release, on Aug. 3, 2016. A third defendant, Joseph Micelli, pleaded guilty to conspiracy to commit wire fraud and securities fraud in 2015 and was sentenced to 60 months in prison, followed by three years of supervised release, on Feb. 23, 2016. The other two defendants, Martin Schlaepfer and Hans-Jurg Lips, remain at large outside the United States. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The FBI’s Las Vegas Field Office investigated the case. Assistant Deputy Chief Anna G. Kaminska and Trial Attorney Blake C. Goebel of the Criminal Division’s Fraud Section prosecuted the case with assistance from the Criminal Division’s Office of International Affairs and the U.S. Attorney’s Office for the District of Nevada. Deputy Chief Brian Young of the Fraud Section previously handled the prosecution. The Securities and Exchange Commission’s Enforcement Division, which conducted a parallel civil-enforcement investigation, as well as the Royal Canadian Mounted Police, also provided valuable assistance.
The Criminal Division’s Fraud Section plays a pivotal role in the Department of Justice’s fight against white-collar crime around the country.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
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