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Monday 27 January 2020
Bay Area Residents Sentenced to Five Years for Counterfeit Currency and Credit Card Fraud SchemesRead the Press Release
SAN FRANCISCO – Nicole Dunlap and Marcus Smith were sentenced to approximately five years in prison for their roles in a currency counterfeiting and credit card fraud scheme, announced United States Attorney David L. Anderson and United States Secret Service Special Agent in Charge Thomas C. Edwards. Defendant Nicole Dunlap was sentenced to 57 months imprisonment; and defendant Marcus Smith was sentenced to 63 months imprisonment. The sentences were handed down by the Honorable Susan Illston, Senior United States District Judge.
Dunlap, 36, and Smith, 37, pleaded guilty to the charges on November 6, 2019. According to their plea agreements, Dunlap and Smith each took part in a conspiracy to manufacture and pass counterfeit one hundred dollar bills. The bills were manufactured in San Francisco and passed or used for payment around the Bay Area. For example, Dunlap admitted to using counterfeit currency at a business in San Francisco, and Smith admitted to carrying counterfeit one hundred dollar bills in Oakland; and each admitted doing so with the intent to defraud. Dunlap and Smith also acknowledged that the conspiracy involved the manufacture of more than 950 counterfeit one hundred dollar bills.
In addition, Dunlap and Smith admitted in their plea agreements to a credit card fraud scheme, involving the possession and use of hundreds of fraudulent credit and identification cards in the identities of numerous victims, as well as card-making equipment in the furtherance of their fraud. In their plea agreements, the defendants stated that they obtained personal information for victims from the Internet and created fraudulent access devices to rent cars, book hotel rooms, rent high-end purses for sale, and make other fraudulent purchases. For example, when Dunlap was arrested, she had in her possession more than one hundred fraudulent cards with various victims’ identities, as well as multiple pieces of access device-making equipment. Upon Smith’s arrest, he also had more than 1500 fraudulent cards with various victims’ identities, as well as multiple pieces of access device-making equipment. The defendants each acknowledged that the total losses from their credit card fraud conspiracy were no less than $250,000.
A federal grand jury indicted Dunlap and Smith in a superseding indictment on June 18, 2019, charging each of them with one count of conspiracy to counterfeit obligations of the United States, in violation of 18 U.S.C. § 371; one count of passing and possessing counterfeit obligations of the United States, in violation of 18 U.S.C. § 472; one count of conspiracy to commit access device fraud, in violation of 18 U.S.C. § 1029(b)(2); one count of fraudulent possession of fifteen or more counterfeit or unauthorized access devices, in violation of 18 U.S.C. § 1029(a)(3); one count of fraudulent possession of device-making equipment, in violation of 18 U.S.C. § 1029(a)(4); and one count of aggravated identity theft, in violation of 18 U.S.C. § 1028A. Dunlap and Smith pleaded guilty on all counts, except the aggravated identity theft counts, which were dismissed.
In addition to the prison terms, Judge Illston sentenced Dunlap and Smith to a three-year period of supervised release and ordered them to pay restitution to the victims of their crimes in amounts to be determined. Dunlap and Smith are in federal custody and will begin serving their sentences immediately.
Four additional co-conspirators have pleaded guilty to related charges for their roles in the counterfeiting conspiracy and await their sentences as indicated in the following chart:
Name Charges Sentence Joshua Barnes Conspiracy to Counterfeit Obligations of the United States, 18 U.S.C. § 371; Counterfeiting Obligations of the United States, 18 U.S.C. § 472; Passing and Possessing Counterfeit Obligations of the United States, 18 U.S.C. § 472 Sentencing pending Erasto Campos a/k/a Eric Campos Conspiracy to Counterfeit Obligations of the United States, 18 U.S.C. § 371; Passing and Possessing Counterfeit Obligations of the United States, 18 U.S.C. § 472 Sentencing scheduled for January 28, 2020 Michael Okeefe Conspiracy to Counterfeit Obligations of the United States, 18 U.S.C. § 371; Passing and Possessing Counterfeit Obligations of the United States, 18 U.S.C. § 472 Sentencing scheduled for April 10, 2020 Michael Suderman Conspiracy to Counterfeit Obligations of the United States, 18 U.S.C. § 371; Passing and Possessing Counterfeit Obligations of the United States, 18 U.S.C. § 472 Status conference regarding sentencing scheduled for February 14, 2020Assistant U.S. Attorney Eric Cheng is prosecuting the case with the assistance of Morgan Byrne. The prosecution is the result of an investigation by the U.S. Secret Service.
Baton Rouge Man Sentenced to Federal Prison for Transferring More than $4.6 Million in Criminal Proceeds as Part of an Unlicensed Money Transmitting BusinessRead the Press Release
United States Attorney Brandon J. Fremin announced today that U.S. District Judge John W. deGravelles sentenced Donovan J. Barker, age 61, of Baton Rouge, Louisiana, to 57 months in federal prison following his conviction for operating an unlicensed money transmitting business. The Court further sentenced Barker to three years of supervised release following his term of imprisonment, and the United States anticipates that the Court will soon order forfeiture in the amount of $642,373.
According to admissions made during Barker’s plea, between September of 2012 and May of 2016, individuals known to Barker conspired to distribute carisoprodol, tramadol, and other substances, by shipping the pills in bulk into the United States, to be broken down into smaller quantities that would then be shipped to individual purchasers. For a time, Barker helped the individuals by accepting the bulk drug shipments at his home and mailing the drugs out to individual purchasers. In January of 2013, law enforcement agents seized more than 50,000 dosage units of tramadol and carisoprodol from Barker’s residence and advised him to stop assisting the effort to import the substances into the United States.
Following the January 2013 seizure, Barker began operating as a money transmitter for the individuals involved in the scheme. As drug sales were generated, Barker would receive the proceeds of the sales (i.e., accept payments for the drugs from the individual buyers) and wire the proceeds to other individuals and businesses. Barker formed and operated several business entities, including Quantum Information Technologies, Caring Partners 1, LLC, Don Western Sky, LLC, Life Positive Services, LLC, and Healthy Life 1, LLC that he used to assist the scheme.
In total, from October 2012 through February 2016, Barker through his businesses, received more than $4.6 million in payments from individuals all across the United States. This included more than $1.3 million in credit card payments made to him via electronic transfer, and more than $750,000 in checks and money orders, from individuals all across the United States who had purchased controlled substances and other substances over the internet. As Barker received the money, he wired the vast majority of the money out to other individuals and businesses, through hundreds of transactions. For instance, he paid the shipping charges incurred by members of the conspiracy, which exceeded $100,000. Moreover, on more than two hundred (200) different occasions, Barker transmitted proceeds from the operation to foreign bank accounts in the Philippines, India, China, and Canada. Accordingly, Barker was unlawfully and knowingly operating an unlicensed money transmitting business, in violation of federal criminal statutes enacted to combat the use of money transmitting businesses to transfer the proceeds of criminal activity.
U.S. Attorney Brandon J. Fremin stated, “In our effort to stop sophisticated criminals who facilitate and finance the illegal distribution of controlled substances, we will use every legal tool at our disposal, including long-term financial investigation and the money laundering and money transmitting statutes. I commend the collaborative efforts of all of the agents and prosecutors who worked on this case and made this unique prosecution a success.”
“The sentencing of Donovan Barker for his role in smuggling funds from illegal drug transactions in and out of the United States is a victory for the American public and a defeat to drug traffickers everywhere. The special agents of IRS Criminal Investigation continue in their mission to disrupt the flow of ill-gotten gains that is the life-blood for these criminals,” said Special Agent in Charge Thomas J. Holloman III, Atlanta Field Office, IRS Criminal Investigation. “We will continue to be relentless in our mission to dismantle these drug trafficking organizations and bring the criminals who run them to justice.”
DEA Assistant Special Agent in Charge Michael R. Sader said, “Criminals who attempt to thwart the efforts of law enforcement through money laundering schemes and businesses will not triumph. The DEA, along with our law enforcement partners, will continue to pursue all avenues to deny drug traffickers and money launderers the one thing they value the most – their profit. The sentencing of this individual should put on notice those who engage in this type of illegal activity.”
“The U.S. Postal Inspection Service is committed to ensuring the U.S. Mails are not used as a tool to distribute narcotics to our communities,” said Adrian Gonzalez, U.S. Postal Inspector in Charge of the Houston Division. “The sentence handed down today should serve as a reminder to other perpetrators engaged in this type of criminal behavior that we will work closely with our law enforcement partners to bring them to justice.”
This matter is being investigated by the Internal Revenue Service-Criminal Investigations, the Drug Enforcement Administration, and the U.S. Postal Inspection Service, with critical assistance from the Louisiana Office of Financial Institutions. The matter is being prosecuted by Assistant United States Attorneys Alan A. Stevens, Kashan Pathan and Robert Piedrahita. The investigation received valuable assistance from the Baton Rouge Police Department, the East Baton Rouge Parish Sheriff’s Office, U.S. Immigration and Customs Enforcement—Homeland Security Investigations, and the Louisiana State Police, and other federal, state, and local agencies.
The investigation is another effort by the Organized Crime Drug Enforcement Task Force (OCDETF) Program that was established in 1982 to mount a comprehensive attack against organized drug traffickers. Today, the OCDETF Program is the centerpiece of the United States Attorney General’s drug strategy to reduce the availability of drugs by disrupting and dismantling major drug trafficking organizations and money laundering organizations and related criminal enterprises. The OCDETF Program operates nationwide and combines the resources and unique expertise of numerous federal, state, and local agencies in a coordinated attack against major drug trafficking and money laundering organizations.
Bakersfield Man Pleads Guilty to Possession with Intent to Distribute Methamphetamine and HeroinRead the Press Release
FRESNO, Calif. — Hacel Alfredo Alvarez, 35, of Bakersfield, pleaded guilty today to possessing with intent to distribute methamphetamine and heroin, U.S. Attorney McGregor W. Scott announced.
According to court documents, Alvarez admitted that he was storing for the purpose of distribution 21 pounds of methamphetamine and over 1 pound of heroin that officers found at his residence in Bakersfield during the execution of a search warrant. The officers also found $8,980 in cash under the mattress in his bedroom.
This case is the product of an investigation by the Southern Tri-County High Intensity Drug Trafficking Area (HIDTA) task force, which consists of agents from Homeland Security Investigations and the Kern County Sheriff’s Office. Assistant U.S. Attorney Karen A. Escobar is prosecuting the case.
Alvarez is scheduled to appear in federal court in Fresno for sentencing on May 18. He faces a mandatory minimum statutory penalty of 10 years and a maximum penalty of life in prison, and a $10 million fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
As Tax Filing Season Opens, IRS Criminal Investigation Highlights Tax Fraud ProsecutionsRead the Press Release
As tax filing season opens this week, the IRS Criminal Investigation Dallas Field Office and the U.S. Attorney’s Office for the Northern District of Texas remind citizens that falsely preparing tax returns and evading taxes are crimes.
Tax payers can view the most current tax tips, forms and scams at www.irs.gov.
“As a new tax filing season begins this week, IRS Criminal Investigation wants to remind people to file accurate tax returns and to choose their tax preparers carefully,” said Tamera Cantu, Special Agent in Charge of the Dallas Field Office. “Those who might consider preparing false and fraudulent tax returns should be aware of the extremely negative consequences that could result in prison time and large tax bills, including substantial fines, interest and penalties.”
“The U.S. Attorney’s Office is committed to prosecuting tax crimes,” said U.S. Attorney Erin Nealy Cox. “We are grateful to our partners at IRS Criminal Investigation for rooting out tax fraud.”
To underscore federal law enforcement’s commitment to pursue those who fail to pay their taxes or otherwise defraud the tax system, below are several tax and tax-related fraud prosecutions that were sentenced in 2019 in the Northern District of Texas:
- Juana Gabriela Ortiz worked for Ebenezer Olayiwola, who owned and operated Peak Insurance and Tax Service. Between 2010 and 2013, Olayiwola and his preparers filed thousands of tax returns claiming more than $35 million in fraudulent tax refunds. Olayiwola admitted to training his preparers to prepare fraudulent tax returns by adding fraudulent Schedules C forms and education credits. Olayiwola’s organization generated approximately millions of dollars in tax preparation fees during that period. Olayiwola was sentenced to 60 months confinement, 3 years supervised release and restitution totaling $30,670,438.98. Ortiz prepared a significant number of false tax returns, and was ordered to pay restitution totaling $3,992,080.
- Francisco Ventura owned numerous tax preparation businesses located in Texas. Subject assisted in teaching training classes for new tax return preparers, supervised other tax return preparers, and reviewed and submitted returns prepared at the business to the IRS. Ventura instructed employees to prepare false income tax returns utilizing false items such as Schedules C and false education credits. Ventura was sentenced to 63 months confinement, 2 years of supervised release and restitution totaling $8,310,261.
- Idrissa Traore and Josseline Cazun-Menendez participated in a stolen identity refund fraud scheme to defraud the IRS. Cazun-Menendez opened at least 66 bank accounts using false identification documents in at least 18 different alias names and Traore opened at least 3 bank accounts in at least 2 alias names also using false identification. Traore maintained organized files of his and Cazun-Menendez’s alias bank account records, debit cards, and fraudulent identification cards. A total of 159 fraudulent tax returns for tax years 2014 through 2017 were associated with fraudulent refunds deposited to the alias accounts. Traore was sentenced to 121 months confinement, 3 years of supervised release and restitution totaling $2,044,547. Cazun-Menendez was sentenced to 60 months confinement, 3 years of supervised release and restitution totaling $1,017,999.
- Mario Antonio Melendez worked for a return preparer who owned numerous tax preparation businesses in the Dallas area. The defendant conspired with the owner to teach return preparation classes instructing employees to prepare fraudulent returns in exchange for a percentage of the owner’s profits. The returns included false education credits and false American Opportunity Tax Credits and resulted in inflated refunds to be paid by the IRS. Melendez was sentenced to 51 months confinement, 1 year of supervised release and restitution totaling $3,885,456.
- Sandra Cantu owned two tax preparation businesses in Dallas and prepared, filed, and caused to be filed income tax returns containing false Schedules A and C. During the period of 2013-2016, her scheme resulted in 1,705 fraudulent returns, 626 of which refunds were paid out. Cantu was sentenced to 48 months confinement, 1 year of supervised release and restitution totaling $1,761,189.12.
The Better Business Bureau is a non-profit that upholds standards for trustworthiness and ethics in business. BBB accepts consumer complaints against businesses and monitors the marketplace for substandard business practices.
In 2019, BBB processed approximately 1,582 reportable complaints against tax return preparers. Approximately 65 of those complaints were for preparers headquartered in the DFW area.
Consumers alleged to BBB that theft of refunds, theft of personal information and identifiers, loss or misappropriation of sensitive data, and late and inaccurate filings are the possible outcomes of choosing the wrong tax preparer.
BBB advises taxpayers to be cautious when choosing a tax preparer. You can check BBB Business Profiles at www.bbb.org. BBB provides the following tips to help you find a tax preparer you can trust:
- Get referrals.
- Choose a preparer that is properly registered. A tax preparer must obtain a PTIN from the IRS.
- Look for credentials. Anyone with a PTIN can prepare your tax forms for you, but some tax preparers have more training and qualifications than others. Learn about tax preparer credentials on the IRS website.
- Keep a watchful eye for promises. Be wary of any tax preparation service that promises larger refunds than the competition and avoid tax preparers who base their fee on a percentage of the refund.
- Search for free tax programs. There are several free government programs that prepare taxes free of charge if you meet an income requirement. Visit the IRS’s Free File page for more information.
Timely and accurate filing, in addition to thorough research on a reputable tax preparer will help north Texans navigate the new tax season with ease and confidence.
2 men guilty of trafficking troubled teenagerRead the Press Release
HOUSTON – Two Houstonians have admitted to recruiting a teenager on social media and trafficking her for sex, announced U.S. Attorney Ryan K. Patrick.
In 2017, Demetrius Delaan White, 28, and Deonte Danquise Bailey-Roach, 27, recruited a troubled teenager on social media. They then brought her from her home in Stephenville to Houston to engage in commercial sex acts.
For three days, they posted the minor victim on internet advertisements for commercial sex, during which time more than 300 people expressed an interest. They rented motel rooms for the sex acts, drove her to clients’ homes and took her to a truck stop. They also had her walk on Bissonnet Street, an area commonly known for an open and rampant sex trade.
To induce the minor victim into continuing to engage in the activity, both men gave her ecstasy drugs before the commercial sex acts. They also kept all the cash proceeds.
U.S. District Judge Kenneth M. Hoyt accepted the pleas and will impose sentencing April 13. At that time, White and Bailey-Roach faces up to life in prison and a possible $250,000 maximum fine.
They have been and will remain in custody pending that hearing.
The FBI and the Houston Police Department, both part of the Human Trafficking Rescue Alliance (HTRA), conducted the investigation.
HTRA law enforcement includes members of the Houston Police Department, FBI, Immigration and Customs Enforcement’s Homeland Security Investigations, Texas Attorney General’s Office, IRS-Criminal Investigation, Department of Labor, Department of State, Texas Alcoholic and Beverage Commission, Texas Department of Public Safety, Coast Guard and Sheriff’s Offices in Harris and Montgomery counties in coordination with District Attorney’s offices in Harris, Montgomery and Fort Bend Counties.
Established in 2004, the United States Attorney’s office in Houston formed HTRA to combine resources with federal, state and local enforcement agencies and prosecutors, as well as non-governmental service organizations to target human traffickers while providing necessary services to those that the traffickers victimized. Since its inception, HTRA has been recognized as both a national and international model in identifying and assisting victims of human trafficking and prosecuting those engaged in trafficking offenses.
Assistant U.S. Attorneys Kate Suh and Sebastian Edwards are prosecuting the case.
Sunday 26 January 2020
Todd County Man Indicted for Felon in Possession of a Firearm and AssaultRead the Press Release
United States Attorney Ron Parsons announced that a Todd County, South Dakota, man has been indicted by a federal grand jury for Felon in Possession of a Firearm and Assault by Striking, Beating, and Wounding.
Tyler Reagle, age 37, was indicted on January 22, 2020. He appeared before U.S. Magistrate Judge Mark A. Moreno on January 24, 2020, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in federal prison and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on January 8, 2020, in Todd County, Reagle, having previously been convicted of a felony, knowingly possessed multiple firearms. The Indictment further alleges that, on the same date, Reagle assaulted his domestic partner.
The charges are merely accusations and Reagle is presumed innocent until and unless proven guilty.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of its renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and local communities to develop effective, locally-based strategies to reduce violent crime.
This case is also part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see: https://www.justice.gov/projectguardian.
The investigation is being conducted by the Rosebud Sioux Tribe Law Enforcement Services and the Todd County Sheriff’s Office. Assistant U.S. Attorney Kirk Albertson is prosecuting the case.
Reagle was released on bond pending trial. A trial date has been set for March 23, 2020.
Statement from United States Attorney Jay E. Town on the Shooting of Birmingham Police Department Detective John FinkeRead the Press Release
BIRMINGHAM, Ala. – “This tragedy is a heartbreaking reminder of the dangers all law enforcement face. While they keep us safe. While they do the job. Our thoughts and prayers are with Detective Finke, his family, and all of Birmingham PD. We should never forget that the line of duty is endowed by sacrifice, selflessness, and courage.”
Statement from United States Attorney Jay E. Town on the Shooting of Birmingham Police Department Detective John FinkeRead the Press Release
BIRMINGHAM, Ala. – “This tragedy is a heartbreaking reminder of the dangers all law enforcement face. While they keep us safe. While they do the job. Our thoughts and prayers are with Detective Finke, his family, and all of Birmingham PD. We should never forget that the line of duty is endowed by sacrifice, selflessness, and courage.”
Sioux Falls Man Indicted for Conspiracy to Distribute MethamphetamineRead the Press Release
United States Attorney Ron Parsons announced that a Sioux Falls, South Dakota, man has been indicted by a federal grand jury for Conspiracy to Distribute a Controlled Substance.
Adam Michael Tanner, age 46, was indicted on September 10, 2019. He appeared before U.S. Magistrate Judge Mark A. Moreno on January 23, 2020, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to life in federal prison and/or a $10,000,000 fine, up to life of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that between March 1, 2018, and September 10, 2019, Tanner knowingly and intentionally, combined, conspired, confederated, and agreed with others to knowingly and intentionally distribute and possess with the intent to distribute 500 grams or more of methamphetamine, a schedule II controlled substance.
The charge is merely an accusation and Tanner is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Northern Plains Safe Trails Drug Enforcement Task Force and the Pierre Police Department. Assistant U.S. Attorney Meghan Dilges is prosecuting the case.
Tanner was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
Rosebud Man Indicted for Threatening a Federal OfficerRead the Press Release
United States Attorney Ron Parsons announced that a Rosebud, South Dakota, man has been indicted by a federal grand jury for Influencing a Federal Officer by Threat.
Anthony One Star, Jr., a/k/a Tony One Star, a/k/a Sonny One Star, age 32, was indicted on January 22, 2020. He appeared before U.S. Magistrate Judge Mark A. Moreno on January 24, 2020, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in federal prison and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on December 15, 2019, One Star threatened to murder a law enforcement officer who was employed by the Rosebud Sioux Tribe.
The charge is merely an accusation and One Star is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Rosebud Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Kirk Albertson is prosecuting the case.
One Star was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
Rapid City Men Sentenced for Armed RobberyRead the Press Release
United States Attorney Ron Parsons announced that two Rapid City, South Dakota, men convicted of Interference with Commerce by Robbery and Conspiracy were sentenced by U.S. District Judge Karen E. Schreier.
Corbin Conroy, age 41, was sentenced on January 23, 2020, to 7 years in federal prison on each count, to run concurrent, followed by 3 years of supervised release, and was ordered to pay a $200 special assessment to the Federal Crime Victims Fund.
Wesley Dillon, age 19, was sentenced on November 22, 2019, to 4 years in federal prison on each count, to run concurrent, followed by 3 years of supervised release, and was ordered to pay a $200 special assessment to the Federal Crime Victims Fund.
The convictions stem from Conroy and Dillon brandishing a firearm and forcibly taking money from a casino employee at Rapid City in March 2019.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of its renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and local communities to develop effective, locally-based strategies to reduce violent crime.
This case is also part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see: https://www.justice.gov/projectguardian.
The investigation was conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Rapid City Police Department. Assistant U.S. Attorney Benjamin Patterson prosecuted the case.
Rapid City Man Charged with Illegal Possession of FirearmRead the Press Release
United States Attorney Ron Parsons announced that a Rapid City, South Dakota, man was charged in federal district court with Possession of a Firearm by a Prohibited Person.
Knel-Philip Chery, age 38, was charged on December 17, 2019. Chery appeared before U.S. Magistrate Judge Daneta Wollmann on January 22, 2020, and pleaded not guilty to the charge. The maximum penalty upon conviction is 10 years in federal prison and/or a $250,000 fine, 3 years of supervised release, and a $100 assessment to the Federal Crime Victims Fund. Restitution may also be ordered.
The charge relates to Chery, a previously convicted felon, being in possession of a Smith & Wesson 9mm semi-automatic pistol in October 2019 at Rapid City. The charge is merely an accusation and Chery is presumed innocent until and unless proven guilty.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of its renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and local communities to develop effective, locally-based strategies to reduce violent crime.
This case is also part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see: https://www.justice.gov/projectguardian.
The investigation is being conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives. Assistant U.S. Attorney Benjamin Patterson is prosecuting the case.
Chery was detained pending trial. A trial date has not been set.
Physician Pleads Guilty to Acquiring Controlled Substances by Fraud and Using A Means of Identification of Another to Acquire Controlled Substances by FraudRead the Press Release
PENSACOLA, FLORIDA – Michael T. Harris, 45, of Gulf Breeze, Florida, entered a guilty plea to the
charges of acquiring controlled substances by fraud, and using a means of identification of another
person in connection to the offense of acquiring controlled substances by fraud. The guilty plea
was announced by Lawrence Keefe, United States Attorney for the Northern District of Florida.Documents introduced at the time of the guilty plea allege that between November 4, 2015, and
August 11, 2016, on at least 24 separate occasions, Harris presented fraudulent prescriptions to
various pharmacies in the Santa Rosa County area to obtain methadone, morphine sulfate, oxycodone,
and alprazolam. During that time, Harris worked as a physician at a medical facility in Gulf Breeze
and shared office space with other physicians. Harris forged another physician’s signature or used
the physician’s pre-signed prescriptions without the physician’s authorization. On each occasion,
Harris used a means of identification of the physician without the physician’s authorization,
namely, the physician’s specifically assigned Drug Enforcement Administration Registration number,
to acquire methadone, morphine sulfate, oxycodone, and alprazolam. In total, between the
above-mentioned dates, Harris used fraudulent prescriptions to acquire approximately 1622 methadone
pills, approximately 570 morphine sulfate pills, approximately 120 oxycodone pills, and
approximately 40 alprazolam pills using fraudulent prescriptions.Harris faces up to four years’ imprisonment for the charge of acquiring controlled substances by
fraud, and up to twenty years’ imprisonment for the charge of using a means of identification of
another person in connection to the offense of acquiring controlled substances by fraud. Harris is
scheduled to be sentenced on April 14, 2020.“Society places a large measure of trust in the hands of licensed physicians, and it’s profoundly
disturbing when a respected professional abuses that trust to illegally obtain controlled
substances,” U.S. Attorney Keefe said. “In addition, this doctor’s actions undermined the trust
placed in him by his fellow physicians, pharmacists, and others in the medical profession.”This case resulted from an investigation by the Drug Enforcement Administration, the Santa Rosa
County Sheriff’s Office, and the Gulf Breeze Police Department. Assistant United States Attorney J.
Ryan Love is prosecuting the case.“The DEA Miami Field Division is committed to bringing to justice any medical professional who
violates the law and the trust placed in them by society,” said Kevin W. Carter, Acting Special
Agent in Charge of the DEA Miami Field Division.”The United States Attorney’s Office for the Northern District of Florida is one of 94 offices that
serve as the nation’s principal litigators under the direction of the Attorney General. To access
public court documents online, please visit the U.S. District Court for the Northern District of
Florida website. For more information about the United States Attorney’s Office, Northern District
of Florida, visit http://www.justice.gov/usao/fln/index.html.The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the
history of our agency at www.Justice.gov/Celebrating150Years.Pensacola Executive Sentenced to 40 Months in Federal Prison for Conspiring with Foreign Nationals to Ship Technology to IranRead the Press Release
PENSACOLA, FLORIDA – United States Attorney Lawrence Keefe, of the Northern District of Florida,
today announced that Pensacola business owner James P. Meharg, 60, was sentenced to 40 months in
prison on federal charges of conspiring to sell and export power generating equipment to a
recipient in Iran, and concealing the scheme, as well as having payments routed to Meharg via a
foreign country. Meharg, CEO and president of Turbine Resources International, LLC, in Pensacola,
conspired with citizens of the United Kingdom and Iran to export a large turbine and parts from the
United States to an Iranian recipient, in violation of the Iranian Transactions and Sanctions
Regulations as well as federal criminal law.Meharg, a U.S. citizen, conspired from October 1, 2017, to June 12, 2019, to violate the Iranian
embargo by attempting to export a Solar Mars 90 S turbine core engine and parts from the United
States, for delivery to an end user in Iran. Evidence revealed that on April 25, 2018, Meharg sent
an invoice for $500,000 to a conspirator in the United Kingdom and received two partial payments of
$124,950 each, on May 7 and May 24, 2018, at least one of which was routed through a company in
Dubai. In total, Meharg received approximately $250,000 in funds laundered through foreign accounts
as payment for having the turbine sent to Iran. Law enforcement authorities, however, were able to
seize the turbine before its transatlantic journey to the end user in Iran. That end user, a
conspirator in Iran, is linked to an Iranian energy company. Meharg also falsified documents used
to lawfully export items from the United States.“Exporting technology to Iran is prohibited by law in order to protect the national security
interests of the United States of America, and this defendant chose to put his own self-interest
and greed above such interests,” Keefe said. “Federal imprisonment should send a clear signal that
the United States cannot and will not look the other way when one of its citizens endangers
the safety of our nation.”“Today’s sentence sends a strong message that trade with Iran in violation of U.S. export control
laws and regulations will not be tolerated,’ said Deputy Assistant Secretary for Export
Enforcement, Douglas Hassebrock. ‘The Bureau of Industry and Security will vigorously pursue
parties that seek to profit from illegally supplying materials to Iran.’Assistant United States Attorney David L. Goldberg, who is a National Security Cyber Specialist,
prosecuted the case following a joint investigation by the United States Department of Commerce’s
Bureau of Industry and Security along with the Federal Bureau of Investigation.“This case serves as a reminder to anyone who acts as an agent of the Iranian government in the
United States, that American law enforcement is relentless in our efforts to protect the national
security of this country and the freedoms of our citizens,” said Rachel L. Rojas, Special Agent in
Charge of the FBI Jacksonville Division. “The FBI was proud to support our partners at the
Department of Commerce – Bureau of Industry and Security in this case, and we are committed to
disrupting any similar actions by individuals on behalf of Iran in the future.”Meharg’s prison sentence will be followed by three years of federal supervised release. He was also
ordered to forfeit a monetary judgment in the amount of $250,000.00.The United States Attorney’s Office for the Northern District of Florida is one of 94 offices that
serve as the nation’s principal litigators under the direction of the Attorney General. To access
public court documents online, please visit the U.S. District Court for the Northern District of
Florida website. For more information about the U.S. Attorney’s Office, Northern District of
Florida, visit http://www.justice.gov/usao/fln/index.html.The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the
history of our agency at www.Justice.gov/Celebrating150Years.Hartford Man Sentenced for Unlicensed Receipt of Explosive MaterialsRead the Press Release
United States Attorney Ron Parsons announced that a Hartford, South Dakota, man convicted of Unlicensed Receipt of Explosive Materials was sentenced on January 7, 2020, by U.S. District Judge Karen E. Schreier.
Gerald “Jerry” Eldon Gosmire, age 60, was sentenced to 18 months in federal prison, followed by 2 years of supervised release, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Gosmire was indicted by a federal grand jury on July 9, 2019. He pled guilty on November 1, 2019.
On November, 27, 2018, law enforcement officers searched Gosmire's property pursuant to a search warrant. During the search, 37 explosive devices were found. A permit was required to possess explosive devices of that nature and Gosmire did not have one.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Minnehaha County Sheriff's Office, and the U.S. Secret Service. Assistant U.S. Attorney Jeffrey C. Clapper prosecuted the case.
Gosmire was immediately turned over to the custody of the U.S. Marshals Service.
Flandreau Man Charged with Aggravated Sexual Abuse of a ChildRead the Press Release
United States Attorney Ron Parsons announced that a Flandreau, South Dakota, man has been indicted by a federal grand jury for Aggravated Sexual Abuse of a Child.
Cecil Long, age 67, was indicted on January 7, 2020. He appeared before U.S. Magistrate Judge Veronica L. Duffy on January 10, 2020, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to life in federal prison and/or a $250,000 fine, life of supervised release, and up to $300 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that between August 31, 2010, and August 30, 2013, and between August 31, 2015, and August 30, 2016, Long knowingly engaged in, and attempted to engage in, sexual acts with a child who had not attained the age of 12.
The charges are merely accusations and Long is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Federal Bureau of Investigation. Assistant U.S. Attorney Ann M. Hoffman is prosecuting the case.
Long was released on bond pending trial, which has been set for March 17, 2020.
Eagle Butte Woman Indicted on Firearm ChargeRead the Press Release
United States Attorney Ron Parsons announced that an Eagle Butte, South Dakota, woman has been indicted by a federal grand jury for Possession of a Firearm by a Prohibited Person.
Carlee Lucia Condon, age 22, was indicted on January 14, 2020. She appeared before U.S. Magistrate Judge Mark A. Moreno on January 16, 2020, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in federal prison and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on July 2, 2019, Condon, being an unlawful user of and addicted to methamphetamine, knowingly possessed a handgun.
The charge is merely an accusation and Condon is presumed innocent until and unless proven guilty.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of its renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and local communities to develop effective, locally-based strategies to reduce violent crime.
This case is also part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see: https://www.justice.gov/projectguardian.
The investigation is being conducted by the Cheyenne River Sioux Tribe Law Enforcement Services and the Northern Plains Safe Trails Drug Enforcement Task Force. Assistant U.S. Attorney Cameron J. Cook is prosecuting the case.
Condon was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
Friday 24 January 2020
Wilkinsburg Woman Sentenced to 14 Years for Health Care Fraud and Illegal Distribution of Pain MedicationRead the Press Release
PITTSBURGH - A resident of Wilkinsburg, Pennsylvania, has been sentenced in federal court to 14 years' imprisonment and five years supervised release on her conviction of Health Care Fraud and the illegal distribution of prescription opioid pain medication, United States Attorney Scott W. Brady announced today.
Chief United States District Judge Mark R. Hornak imposed the sentence yesterday on Antoinette Adair, age 51. Adair was convicted of one count of Health Care Fraud, one count of Conspiracy to Distribute Oxycodone and Oxymorphone, and eight counts of Possession with the Intent to Distribute and Distribution of Oxycodone and Oxymorphone.
According to information presented to the court, Adair was part of a group of individuals involved in a large-scale Health Care Fraud and pill distribution network. As a part of the criminal enterprise, Adair and others obtained powerful and addictive prescription pain medication through physicians under the false pretense that they intended to use that medication themselves. In fact, they intended to sell the medication for profit to individuals addicted to those medications. Additionally, medication was often paid for through taxpayer-funded health care insurance programs. Thus, the taxpayers ended paying much of the prescription medications that these conspirators sold.
Assistant United States Attorney Brendan T. Conway prosecuted this case on behalf of the government.
United States Attorney Brady commended the Federal Organized Crime Drug Enforcement Task Force (OCDETF) investigation led by the Federal Bureau of Investigation, the Drug Enforcement Administration, the Pennsylvania Office of the Attorney General, the Pittsburgh Bureau of Police, and the Allegheny County Police Department for the investigation leading to the successful prosecution of Adair.
Waterbury Licensed Professional Counselor Pays $39K to Settle False Claims AllegationsRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, today announced that CHANNA SONTAG, LPC, and her business, CHILDREN’S BEHAVIORAL THERAPY LLC, have entered into a civil settlement agreement with the federal and state governments and will pay more than $39,000 to resolve allegations that they violated the federal and state False Claims Acts.
Sontag is a state Licensed Professional Counselor and the owner of Children’s Behavioral Therapy LLC, a private behavioral health practice in Waterbury. Sontag was enrolled as a Licensed Behavioral Health Clinician in Independent Practice in the Connecticut Medical Assistance Program (“CMAP”), which includes the state’s Medicaid program. It is alleged that, on numerous occasions, Sontag billed Medicaid for 60 minutes of one-on-one individual psychotherapy services when, in fact, she had performed individual psychotherapy services for less time.
To resolve the allegations under the federal and state False Claims Acts, Sontag and Children’s Behavioral Therapy LLC will pay $39,471.22 in order to reimburse the Medicaid program for conduct occurring from November 3, 2014 to March 15, 2017. Sontag has also agreed to a voluntary five-year suspension from the Connecticut Medicaid Program as part of the settlement.
Under the False Claims Act, the government can recover up to three times its actual damages, plus penalties of $11,181 to $22,363 for each false claim.
This case stems from a larger investigation into fraudulent activity in the area of behavioral health services, which has been jointly conducted by the Office of the Inspector General of the U.S. Department of Health and Human Services, the Medicaid Fraud Control Unit of the Chief State’s Attorney’s Office and the Connecticut Office of the Attorney General, with support from the Connecticut Department of Social Services.
This matter was handled by Assistant U.S. Attorney Anne Thidemann, and Assistant Attorney General Karla Turekian of the Connecticut Office of the Attorney General.
People who suspect health care fraud are encouraged to report it by calling 1-800-HHS-TIPS or the Health Care Fraud Task Force at (203) 777-6311.
Washington State Man Sentenced to over 17 Years in Federal Prison for Child ExploitationRead the Press Release
Fayetteville, Arkansas – David Clay Fowlkes, Acting United States Attorney for the Western District of Arkansas, announced that Kyle Paul Vance, age 24, of Shelton, Washington, was sentenced today to 210 months in federal prison without the possibility of parole followed by 15 years of supervised release on one count of enticing a minor to Produce to Child Pornography and one count of Receipt of Child Pornography. The Honorable Timothy L. Brooks, United States District Judge, presided over the sentencing hearing in the United States District Court in Fayetteville.
According to court records, in January 12, 2018, a concerned father came to the Gravette Police Department to report that an individual, later identified as Vance solicited sexually explicit images of his 9-year-old daughter via Facebook Messenger. The investigation was turned over to the FBI, who obtained a search warrant for Vance’s Facebook records. Among the records produced by Facebook, law enforcement located a messenger conversation in which Vance solicited multiple sexually explicit images from the minor. The FBI subsequently executed a search warrant on Vance’s residence located in Washington. While at the residence, FBI agents interviewed Vance, who admitted to engaging in online conversations with minors and receiving nude images of underage females.
In October of 2019, Vance was found guilty by a federal jury sitting in Fayetteville of Production of Child Pornography and Knowing Receipt of Child Pornography.
This case was investigated by the Gravette Police Department and the Federal Bureau of Investigation. Assistant United States Attorney’s Carly Marshall and Dustin Roberts prosecuted the case for the United States.
Washington State Couple and Companies Sentenced for Fraud and False Statement in Connection with Renewable Energy Fraud SchemeRead the Press Release
A Richland, Washington couple and their companies, HTG Trucking LLC and Freedom Fuel Inc., were sentenced yesterday in federal court in Richland, Washington for fraud and false statement charges in connection with a renewable energy fraud scheme, announced Assistant Attorney General Jeffrey Bossert Clark of the Justice Department’s Environment and Natural Resources Division and U.S. Attorney for the Eastern District of Washington William D. Hyslop.
Hector Garza Jr., 49, was sentenced to two years in prison to be followed by a three-year term of supervised release. Tammy Garza, 38, was sentenced to four months in prison and one year of supervised release. HTG Trucking LLC and Freedom Fuel Inc. were placed on probation for three years. All of the defendants were ordered to pay restitution to the U.S. Treasury of $284,546 and a $100,000 fine. The defendants had previously pled guilty on June 6, 2019, before the Honorable Salvador Mendoza Jr.
Hector and Tammy Garza and their companies, HTG Trucking and Freedom Fuel, were participants in a conspiracy involving Gen-X Energy Group Inc. (Gen-X), a renewable energy company formerly located in Pasco and Moses Lake, Washington. Between January 2013 and April 2013, Hector Garza and his co-conspirators falsely claimed the production of hundreds of thousands of marketable renewable energy credits, which they then sold for more than $296,000, and filed false claims with the IRS for $284,546 in excise credit refunds. Throughout this period, much of the renewable fuel claimed to be produced at the Gen-X facilities was either not produced or it was re-processed multiple times.
Hector Garza, HTG Trucking and Freedom Fuel pled guilty to conspiring to defraud the United States with respect to the false claims made to the IRS, through the use of the Garzas’ companies, which were used to “round” supposed renewable fuel by driving the same material back and forth between Gen-X’s Moses Lake facility and the Garzas’ businesses in Othello, Washington. This activity enabled the conspirators to generate fraudulent renewable energy credits and tax credits each time the material was “rounded.” Tammy Garza pled guilty to a separate offense of aiding and abetting the use of false statements in connection with the renewable energy credits that were claimed and sold as part of the scheme.
Several conspirators have previously pled guilty and been sentenced in connection with their role in the fraud. In June 2017, Scott Johnson, the former CEO of Gen-X, was sentenced to 97 months in prison in connection with his role in the fraud scheme. In December 2017, Donald Holmes, the former vice president of Gen-X, was sentenced to 78 months of imprisonment. In June 2018, Jin Chul “Jacob” Cha of Tustin, California, was sentenced to 51 months in prison in connection with his role in the fraud.
The case was prosecuted by Assistant U.S. Attorney Dan Fruchter of the Eastern District of Washington; EPA Regional Criminal Enforcement Counsel and Special Assistant U.S. Attorney Karla G. Perrin for the Eastern District of Washington and Senior Trial Attorney Jennifer Leigh Blackwell of the Environment and Natural Resources Division’s Environmental Crimes Section. The IRS-Criminal Investigation and the Environmental Protection Agency’s Criminal Investigation Division investigated the case.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Washington State Couple and Companies Sentenced for Fraud and False Statement in Connection with Renewable Energy Fraud SchemeRead the Press Release
WASHINGTON – A Richland, Washington couple and their companies, HTG Trucking LLC and Freedom Fuel Inc., were sentenced yesterday in federal court in Richland, Washington for fraud and false statement charges in connection with a renewable energy fraud scheme, announced Assistant Attorney General Jeffrey Bossert Clark for the Justice Department’s Environment and Natural Resources Division and U.S. Attorney for the Eastern District of Washington William D. Hyslop.
Hector Garza Jr., 49, was sentenced to two years in prison to be followed by a three-year term of supervised release. Tammy Garza, 38, was sentenced to four months in prison and one year of supervised release. All of the defendants were ordered to pay restitution to the U.S. Treasury of $284,546 and a $100,000 fine. HTG Trucking, LLC and Freedom Fuel, Inc. were sentenced to a three-year term of court supervision. The defendants had previously pled guilty on June 6, 2019, before the Honorable Salvador Mendoza Jr.
Hector and Tammy Garza and their companies, HTG Trucking and Freedom Fuel, were participants in a conspiracy involving Gen-X Energy Group Inc. (Gen-X), a renewable energy company formerly located in Pasco and Moses Lake, Washington. Between January 2013 and April 2013, Hector Garza and his co-conspirators falsely claimed the production of hundreds of thousands of marketable renewable energy credits, which they then sold for more than $296,000, and filed false claims with the IRS for $284,546 in excise credit refunds. Throughout this period, much of the renewable fuel claimed to be produced at the Gen-X facilities was either not produced or it was re-processed multiple times.
Hector Garza, HTG Trucking and Freedom Fuel pled guilty to conspiring to defraud the United States with respect to the false claims made to the IRS, through the use of the Garzas’ companies, which were used to “round” supposed renewable fuel by driving the same material back and forth between Gen-X’s Moses Lake facility and the Garzas’ businesses in Othello, Washington. This activity enabled the conspirators to generate fraudulent renewable energy credits and tax credits each time the material was “rounded.” Tammy Garza pled guilty to a separate offense of aiding and abetting the use of false statements in connection with the renewable energy credits that were claimed and sold as part of the scheme.
Defrauding a renewable energy program in order to steal taxpayer funds is simply unconscionable,” said Hyslop. “I especially want to commend the exceptional investigative work by the Environmental Protection Agency and the Internal Revenue Service in uncovering this complex scheme, and to thank them and the Department of Justice’s Environment and Natural Resources Division for their support and hard work throughout this investigation and prosecution. We will continue to work with our law enforcement partners to ensure that individuals and companies that steal taxpayer dollars are held to account.”
"Mr. and Mrs. Garza's actions to defraud the IRS and the EPA were dishonest and harmful to our community. They conspired with others to steal from honest taxpayers and exploit financial incentives aimed at safeguarding our environment," said IRS-Criminal Investigation Special Agent in Charge Justin Campbell. "IRS-Criminal Investigation will continue to prosecute those who defraud the U.S. for personal gain."
“We will not tolerate environmental fraud in the Renewable Fuels Program, or anywhere else.” said EPA Assistant Administrator for Enforcement and Compliance Assurance Susan Bodine. “This case highlights EPA's resolve in working with partners, nationally, to hold bad actors accountable."
Several conspirators have previously pled guilty and been sentenced in connection with their role in the fraud. In June 2017, Scott Johnson, the former CEO of Gen-X, was sentenced to 97 months in prison in connection with his role in the fraud scheme. In December 2017, Donald Holmes, the former vice president of Gen-X, was sentenced to 78 months of imprisonment. In June 2018, Jin Chul “Jacob” Cha of Tustin, California, was sentenced to 51 months in prison in connection with his role in the fraud.
The case was prosecuted by Assistant U.S. Attorney Dan Fruchter of the Eastern District of Washington; EPA Regional Criminal Enforcement Counsel and Special Assistant U.S. Attorney Karla G. Perrin for the Eastern District of Washington and Senior Trial Attorney Jennifer Leigh Blackwell of the Environment and Natural Resources Division’s Environmental Crimes Section. The IRS-Criminal Investigation and the Environmental Protection Agency’s Criminal Investigation Division investigated the case.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Union Officials Plead Guilty to Violent ExtortionRead the Press Release
Two officials from the local Iron Workers union pleaded guilty today for their role in a brutal assault on a group of non-union ironworkers in Dyer, Indiana. The attack, which left multiple workers with serious injuries, was part of an effort to obtain a contract for the union to assist with the construction of the Plum Creek Christian Academy, a school affiliated with the Dyer Baptist Church.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Thomas L. Kirsch II of the Northern District of Indiana, Special Agent in Charge Irene Lindow, Chicago Regional Office, U.S. Department of Labor, Office of Inspector General (DOL-OIG) and Special Agent in Charge Grant Mendenhall of the FBI’s Indianapolis Field Office made the announcement.
Thomas Williamson Sr., 68, and Jeffrey Veach, 56, pleaded guilty to one count of extortion conspiracy before U.S. Magistrate Judge John Martin of the Northern District of Indiana.
Veach is the current president of Local 395 of the International Association of Bridge, Structural, Ornamental, and Reinforcing Iron Workers (Local 395), based in Portage, Indiana. Prior to his recent retirement, Williamson was a business agent for Local 395. Under federal law, following their guilty pleas, Veach will forfeit his position as president and both men will be barred from holding any union position for at least 13 years following the end of any prison sentences they may serve.
Pursuant to their plea agreements, Williamson and Veach admitted that on Jan. 7, 2016, they conspired to use actual and threatened violence to obtain contracts for Local 395 – a business contract from general contractor Lagestee-Mulder of Illinois, and/or a labor contract from D5 Iron Works (D5), also of Illinois. Prior to Jan. 7, 2016, the two defendants had learned that D5 was performing structural ironwork for the Dyer Baptist Church, which was located in Local 395’s “territory.” They also knew that D5 was not signed up to a labor contract with Local 395.
On the afternoon of Jan. 6, 2016, Williamson visited the church jobsite to talk to the foreman of the D5 crew and convince him to “sign up” with Local 395, or to stop work on the site. After being told to leave the site, Williamson went across the street to the church. Once inside, he confronted a youth pastor for the church and told him that it was “unethical” to use non-union labor for the construction site. Williamson offered to get “his guys” on the jobsite instead. The next morning, Williamson returned to the jobsite, this time accompanied by co-defendant Veach. The D5 foreman again refused to join the union and asked the two defendants to leave the site. Williamson became angry and grabbed the foreman’s jacket, calling him, among other things, a “scab bastard.” As they left the site, Williamson remarked to Veach that the two of them were going to have to “take things back to old school.”
The two defendants then gathered up about 10 rank-and-file members of Local 395 to return to the jobsite that afternoon. Once at the jobsite, the union members immediately attacked the D5 workers and beat them with fists and loose pieces of hardwood, kicking them while they were on the ground. As a result of the attack, one D5 worker sustained a broken jaw that required several surgeries and extended hospitalization.
The DOL-OIG, the FBI and the Dyer Police Department investigated the case. Trial Attorneys Alexander Gottfried and Robert Tully of the Criminal Division’s Organized Crime and Gang Section are prosecuting the case. Through its Labor Unit, the Organized Crime and Gang Section supports federal criminal prosecution in cases involving labor-management relations, internal union affairs, and the operation of employee pension and health care plans. Assistant Chief for Labor-Management Racketeering Gerald Toner provided invaluable assistance in the prosecution of this case.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Union Officials Plead Guilty to Violent ExtortionRead the Press Release
WASHINGTON – Two officials from the local Iron Workers union pleaded guilty today for their role in a brutal assault on a group of non-union ironworkers in Dyer, Indiana. The attack, which left multiple workers with serious injuries, was part of an effort to obtain a contract for the union to assist with the construction of the Plum Creek Christian Academy, a school affiliated with the Dyer Baptist Church.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Thomas L. Kirsch II of the Northern District of Indiana, Special Agent in Charge Irene Lindow, Chicago Regional Office, U.S. Department of Labor, Office of Inspector General (DOL-OIG) and Special Agent in Charge Grant Mendenhall of the FBI’s Indianapolis Field Office made the announcement.
Thomas Williamson Sr., 68, and Jeffrey Veach, 56, pleaded guilty to one count of extortion conspiracy before U.S. Magistrate Judge John Martin of the Northern District of Indiana.
Veach is the current president of Local 395 of the International Association of Bridge, Structural, Ornamental, and Reinforcing Iron Workers (Local 395), based in Portage, Indiana. Prior to his recent retirement, Williamson was a business agent for Local 395. Under federal law, following their guilty pleas, Veach will forfeit his position as president and both men will be barred from holding any union position for at least 13 years following the end of any prison sentences they may serve.
Pursuant to their plea agreements, Williamson and Veach admitted that on Jan. 7, 2016, they conspired to use actual and threatened violence to obtain contracts for Local 395 – a business contract from general contractor Lagestee-Mulder of Illinois, and/or a labor contract from D5 Iron Works (D5), also of Illinois. Prior to Jan. 7, 2016, the two defendants had learned that D5 was performing structural ironwork for the Dyer Baptist Church, which was located in Local 395’s “territory.” They also knew that D5 was not signed up to a labor contract with Local 395.
On the afternoon of Jan. 6, 2016, Williamson visited the church jobsite to talk to the foreman of the D5 crew and convince him to “sign up” with Local 395, or to stop work on the site. After being told to leave the site, Williamson went across the street to the church. Once inside, he confronted a youth pastor for the church and told him that it was “unethical” to use non-union labor for the construction site. Williamson offered to get “his guys” on the jobsite instead. The next morning, Williamson returned to the jobsite, this time accompanied by co-defendant Veach. The D5 foreman again refused to join the union and asked the two defendants to leave the site. Williamson became angry and grabbed the foreman’s jacket, calling him, among other things, a “scab bastard.” As they left the site, Williamson remarked to Veach that the two of them were going to have to “take things back to old school.”
The two defendants then gathered up about 10 rank-and-file members of Local 395 to return to the jobsite that afternoon. Once at the jobsite, the union members immediately attacked the D5 workers and beat them with fists and loose pieces of hardwood, kicking them while they were on the ground. As a result of the attack, one D5 worker sustained a broken jaw that required several surgeries and extended hospitalization.
The Department of Labor-Office of Inspector General, the Federal Bureau of Investigation and the Dyer Police Department investigated the case. Trial Attorneys Alexander Gottfried and Robert Tully of the Criminal Division’s Organized Crime and Gang Section are prosecuting the case. Through its Labor Unit, the Organized Crime and Gang Section supports federal criminal prosecution in cases involving labor-management relations, internal union affairs, and the operation of employee pension and health care plans. Assistant Chief for Labor-Management Racketeering Gerald Toner provided invaluable assistance in the prosecution of this case.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
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Two Men Sentenced to Prison for Their Roles in an Investment Fraud Scheme Targeting Elderly VictimsRead the Press Release
Two men were sentenced to prison for their roles in a multimillion-dollar investment fraud scheme targeting the elderly and other vulnerable victims.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney R. Andrew Murray of the Western District of North Carolina and Inspector in Charge David McGinnis of the U.S. Postal Inspection Service’s Charlotte Division made the announcement.
Robert Leslie Stencil, 62, of Charlotte, North Carolina, and Michael Allen Duke, 51, of Richardson, Texas, were each sentenced by U.S. District Judge Max O. Cogburn Jr. of the Western District of North Carolina. Stencil was sentenced to 135 months in prison, and was also ordered to pay $2,745,239 in restitution and to forfeit $868,317.58. Duke was sentenced to 70 months in prison, and was ordered to pay $1,635,485 in restitution.
Following a three-week trial in January 2019, Stencil and Duke were each found guilty of one count of conspiracy to commit mail and wire fraud. In addition, Stencil was found guilty of 13 counts of mail fraud, 13 counts of wire fraud and four counts of money laundering. Duke was found guilty of three counts of mail fraud, one count of wire fraud and one count of money laundering.
According to the evidence presented at trial, from 2012 through 2016, Stencil, Duke and their co-conspirators sold millions of dollars of worthless stock in a sham company named Niyato Industries Inc. (Niyato). Stencil played the role of Niyato’s chief executive officer. Duke was Stencil’s top salesperson. Together with their co-conspirators, Stencil and Duke portrayed Niyato as a leader in its field, manufacturing electric vehicles and converting gasoline vehicles to run on compressed natural gas. Stencil, Duke and their co-conspirators told victims that Niyato was run by a team of high-profile executives, and that Niyato had patented technology, state-of-the-art facilities and valuable contracts. They also told victims that Niyato would use 97 percent of the money it raised selling stock to grow its business and expand operations. Stencil, Duke and their co-conspirators used high-pressure tactics when pitching Niyato stock to victims, the evidence showed. Among other things, they sold victims on the opportunity to “get in on the ground floor,” offering them a portion of a supposedly limited supply of pre-IPO stock at $.50 per share and promising them a 10- to 16-fold return when Niyato went public. From 2012 to 2016, Stencil, Duke and their co-conspirators repeatedly told victims that an IPO was imminent, the evidence showed.
In reality, Niyato had no patents, facilities, products or plans to commence an IPO. Niyato’s true business was the sale of worthless stock. Stencil, Duke and their co-conspirators used nearly all of the money raised by selling Niyato stock for their own personal benefit, with Stencil paying salespeople – like Duke – half or nearly half of the money they solicited from each investor on behalf of Niyato. Moreover, Stencil used Niyato’s bank account as his own personal piggybank, the evidence showed.
The evidence showed that, together, Stencil, Duke and their co-conspirators sold approximately $2.8 million in stock to approximately 140 victims, many of whom were elderly or vulnerable for other reasons.
Five other defendants have pleaded guilty in this matter and have already been sentenced, namely Nicholas Fleming, 64, of Northridge, California; Martin Delaine Lewis, 53, of Frisco, Texas; Paula Saccomanno, 62, of Boca Raton, Florida; Kristian F. Sierp, 48, of Costa Rica; and Dennis Swerdlen, 65, of Boca Raton, Florida. Daniel Thomas Broyles Sr., 62, of Beverly Hills, California, was also charged and remains a fugitive. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
This case was investigated by the U.S. Postal Inspection Service. Trial Attorney Christopher Fenton of the Criminal Division’s Fraud Section is prosecuting the case.
The Criminal Division’s Fraud Section plays a pivotal role in the Department of Justice’s fight against white collar crime around the country.
Individuals who believe that they may be a victim in this case should visit the Fraud Section’s Victim Witness website for more information.
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 Defendants Sentenced in Poly-Drug Distribution Conspiracy Originating in CaliforniaRead the Press Release
United States Attorney Joe Kelly announced that on January 23, 2020, Chief United States District Judge John M. Gerrard sentenced Marvin Moua and Meng Her to terms of imprisonment of 151 months and 37 months, respectively. Moua, 35, and Her, 38, conspired together and with others to transport narcotics including methamphetamine, marijuana, and psilocybin mushrooms from California to Nebraska, and then distributed the drugs in Nebraska, Iowa, and in other states. Billy Fang is a remaining co-conspirator in the case and will be sentenced at a later date.
In early 2019, investigators learned that a mobile home in Omaha was being used by the drug trafficking organization to package narcotics for further distribution. Investigators thereafter identified several members of the group and determined that they also used residences in Storm Lake, Iowa. Over the course of the investigation, agents obtained warrants to search the residences in Omaha and Storm Lake. On May 2, 2019, investigators recovered close to five pounds of methamphetamine from a suitcase inside a residence in Storm Lake. Investigators also seized approximately 74 pounds of marijuana and a stolen firearm within a second residence, as well as baggies of methamphetamine and marijuana, two AR-15-style rifles, and a Glock handgun inside a car parked inside an enclosed garage.
The case was investigated by the Drug Enforcement Administration, Omaha Field Division, the Iowa Division of Narcotics Enforcement, and the Storm Lake (Iowa) Police Department.
Two Central Illinois Hunters Banned for Illegal PracticesRead the Press Release
PEORIA, Ill. – The former host of a cable hunting show, Christopher Brackett, of East Peoria, Ill., and the owner of a waterfowl outfitting service, Rick A. Hamm, of Chillicothe, Ill., have each been banned from hunting during their respective terms of probation. Both central Illinois men were sentenced in separate, unrelated cases for federal hunting violations of the Lacey Act.
Brackett, 41, former host of “Fear No Evil,” a cable show that aired on the Outdoor Channel, is banned from hunting worldwide and cannot possess firearms during his sentence of 30 months of probation. U.S. District Judge Michael M. Mihm further ordered Brackett to pay $3,500 in restitution to the State of Indiana and to pay a $26,500 fine.
Hamm, 58, owner of “Show Me Your Snows,” a waterfowl outfitting service, is banned from hunting and guiding worldwide during his sentence of 24 months of probation. U.S. District Judge James E. Shadid further ordered Hamm to serve five days in jail, to pay $2,500 in restitution to the State of Illinois and the U.S. Fish and Wildlife Service, and to pay a $50,000 fine.
Brackett was sentenced on Jan. 15, 2020, for unlawful transportation of wildlife, in violation of the Lacey Act. Brackett pleaded guilty in July 2019, to killing two bucks within minutes of each other, during the December 2013 filming of an episode of his cable show, when the state of Indiana permitted hunters to kill only one buck per season. Brackett further admitted that he transported the second, 11-point buck he had nicknamed the “Unicorn Buck,” for its unique antler formation, to his home in East Peoria. Brackett featured the “Unicorn Buck” kill on his television show in 2014. Brackett instructed his cameraman and producer to hide footage of the first buck killed, a smaller eight-point buck, and instructed an employee to destroy an eight-point rack prior to charges being filed against him,
Hamm was sentenced on Jan. 16, 2020, to unlawful sale of wildlife, in violation of the Lacey Act. Hamm pleaded guilty in September 2019, to using an electronic caller to lure geese into shooting range during a guided hunt in December 2015, in Fulton County, Ill., knowing it was unlawful under the Migratory Bird Treaty Act and Illinois conservation regulations.
In a prior federal case, in 2000, Hamm was fined $5,000 for federal violations of the Migratory Bird Treaty Act dealing with shooting waterfowl over the bag limit, transporting untagged waterfowl, and hunting with lead shot.
Hamm’s co-defendants, Trent Gustafson, Zachary Entwistle, James Schupp, and J. Weston Schupp, were each sentenced to six months of probation, during which each is banned from waterfowl hunting, and ordered to pay a fine of $1,500.
Assistant U.S. Attorney Katherine Legge represented the government in the case prosecutions. The U.S. Fish and Wildlife Service conducted the case investigations with the assistance of both the Illinois and Indiana Departments of Natural Resources.
Tulsa Man Convicted of Sex Trafficking through Force and CoercionRead the Press Release
TULSA, Okla. –A federal jury today returned a guilty verdict against a man who trafficked a woman through force and coercion then attempted to obstruct the investigation into his crimes, announced U.S. Attorney Trent Shores.
Ramar Travelle Palms, 31, was convicted of the sex trafficking through the use of force, fraud and coercion; attempted obstruction of sex trafficking enforcement; and transporting an individual for prostitution.
“The jury got it right, and I thank them for their service. Human trafficking is a vile and repugnant crime, and it’s happening right here in Oklahoma. So called “pimps” like Mr. Palms dehumanize victims through psychological abuse and sexual exploitation. They control victims with violence and threats,” said U.S. Attorney Trent Shores. “The victim in this case, however, was also a survivor. She testified in this case, facing her tormentor as he sat across the courtroom. I hope her courage and this guilty verdict will give hope to others that help is out there. The Tulsa Police Department and U.S. Attorney’s Office remain deeply committed to ensuring every victim’s voice is heard. Together, we will work tirelessly to eradicate human trafficking in our community. From the traffickers who supply commercial sex to the ‘Johns’ who demand it, you will be prosecuted.”
During the four-day trial, the United States showed that Palms trafficked the victim in Tulsa, Oklahoma City, Dallas, and Houston. Palms forced the victim to advertise on CityXGuide.com and book hotel rooms in her name, particularly in areas that were closer to higher paying, wealthier johns. He provided the money to advertise and book the rooms but did not allow his name to be associated with the activity in an effort to distance himself legally from the activity.
A Tulsa Police officer testified that he originally met the victim in November 2018 in Tulsa. The Vice officer answered an online advertisement for a “$100 Quick Visit” with the victim, which indicates a short prostitution visit. When the officer arrived, he noticed Palms at the bottom of the stairs watching him enter the hotel. Once with the victim, the officer identified himself and the two discussed the trafficking operation. The victim revealed that she did not willingly participate in prostitution.
The United States argued that the victim did not simply enter into a mutual agreement with Palms to participate in the sex trade as the defense contended. Prosecutors showed that Palms glorified the pimp lifestyle and bragged about making money from selling women. They argued that Palms controlled the victim, the trafficking operations and the money he received from exploiting the victim. They stated that Palms was a “finesse pimp” who used charm to gain the victim’s trust and affection. Then he also began to use control, fear and violence to force and keep the victim in a life of prostitution. The victim described how Palms abused her, often strangling her, when he was angry or she did not produce enough money. The victim also testified that she witnessed Palms violently abusing another female he trafficked.
In the prosecution’s closing, Assistant U.S. Attorneys Christopher Nassar and Edward Snow reminded the jury that this trafficking case was about money, violence, fear and control. Assistant U.S. Attorney Nassar described how Palms targeted a vulnerable woman, isolated her, degraded her and imposed his will and force upon her, leading the victim to live in fear if she ever “stepped out of line.” He reminded the jury that the only thing Palms cared about was using the victim to make money. The prosecutors asked the jury to follow the evidence and find Palms guilty.
The Tulsa Police Department conducted the investigation. Assistant U.S. Attorneys Christopher Nassar and Edward Snow prosecuted the case.
Top Executives Plead Guilty to Participating in a Billion Dollar Ponzi Scheme—the Biggest Criminal Fraud Scheme in the History of the Eastern District of CaliforniaRead the Press Release
SACRAMENTO, Calif. — The owners of DC Solar, a Benicia-based company, pleaded guilty today to charges related to a billion dollar Ponzi scheme— the biggest criminal fraud scheme in the history of the Eastern District of California. The government’s investigation has resulted in the largest criminal forfeiture in the history of the District with over $120 million in assets forfeited that will go to victims, and has returned $500 million to the United States Treasury, with more to come, U.S. Attorney McGregor W. Scott announced.
Jeff Carpoff, 49, of Martinez, pleaded guilty today to conspiracy to commit wire fraud and money laundering. His wife, Paulette Carpoff, 46, pleaded guilty today to conspiracy to commit an offense against the United States and money laundering. According to court documents, between 2011 and 2018, DC Solar manufactured mobile solar generator units (MSG), solar generators that were mounted on trailers that were promoted as able to provide emergency power to cellphone towers and lighting at sporting events. A significant incentive for investors were generous federal tax credits due to the solar nature of the MSGs.
The conspirators pulled off their scheme by selling solar generators that did not exist to investors, making it appear that solar generators existed in locations that they did not, creating false financial statements, and obtaining false lease contracts, among other efforts to conceal the fraud. In reality, at least half of the approximately 17,000 solar generators claimed to have been manufactured by DC Solar did not exist.
U.S. Attorney Scott stated: “This billion dollar Ponzi scheme hurt investors and took money from the United States Treasury. This case represents not only the largest criminal fraud scheme in the history of the District, it also represents the largest criminal forfeiture in the history of the District with over $120 million in assets forfeited. All of this money will be returned to the victims. This scheme also targeted the United States Treasury, and we have returned $500 million to the Treasury to date. Agents, investigators and attorneys from various federal agencies are still working to continue to return money to victims and the United States Treasury. Today’s guilty pleas sends a strong message that fraudsters will get caught and will pay for their crimes. You can run, but you cannot hide.”
The forfeiture included seizing and auctioning 148 of the Carpoffs’ luxury and collector vehicles, including the 1978 Firebird previously owned by actor Burt Reynolds. This historical auction resulted in recouping approximately $8.233 million for victims. In addition to their collection of luxury and collector vehicles, Jeff and Paulette Carpoff used money from the scheme to pay for a minor-league professional baseball team and a NASCAR racecar sponsorship; to purchase luxury real estate in California, Nevada, the Caribbean, Mexico, and elsewhere; a subscription private jet service; a suite at a professional football stadium; and jewelry.
“The Carpoffs and their co-conspirators wove a web of lies and deceit in a massive fraud scheme. Meticulous review and analysis of millions of documents revealed the operation and true intention of the scheme,” said Special Agent in Charge Sean Ragan. “The FBI is committed to our partnerships with the Internal Revenue Service Criminal Investigation, Federal Deposit Insurance Corporation Office of Inspector General, and U.S. Marshals Service. Together, we seek to uncover fraud that exploits investors and taxpayers, ensuring criminals face justice.”
“By all outer appearances this was a legitimate and successful company,” said Kareem Carter, Special Agent in Charge IRS Criminal Investigation. “But in reality it was all just smoke and mirrors — a Ponzi scheme touting tax benefits to the tune of over $900 million. IRS CI is committed to investigating those who take advantage and impact the financial well-being of others for their own personal gain.”
“The Federal Deposit Insurance Corporation, Office of Inspector General (FDIC-OIG) is pleased to join our law enforcement colleagues in announcing these guilty pleas,” stated Special Agent in Charge Wade Walters for the FDIC OIG San Francisco Regional Office. “The defendants conspired with others to create a fraudulent business venture that duped unsuspecting entities, including banks, to invest approximately $1 billion, which the two later used to support a lavish lifestyle. They also knowingly engaged in a money laundering transaction involving criminally derived property. The FDIC-OIG is committed to ensuring that those who use our Nation’s banks to undermine the integrity of the financial system will be held accountable.”
Four defendants have previously pleaded guilty to federal criminal charges related to the fraud scheme since October. Joseph W. Bayliss, 44, of Martinez, and Ronald J. Roach, of Walnut Creek, each pleaded guilty to related charges on Oct. 22, 2019. Robert A. Karmann, 53, of Clayton, pleaded guilty to related charges on Dec. 17, 2019. Ryan Guidry, 53, of Pleasant Hill, pleaded guilty to related charges on Jan. 14, 2020. A seventh co-conspirator is scheduled to plead guilty on Feb. 11. The investigation into the fraud remains ongoing.
This case is the product of an investigation by the Federal Bureau of Investigation, IRS‑Criminal Investigation, and the Federal Deposit Insurance Corporation Office of Inspector General. Assistant U.S. Attorneys André M. Espinosa and Kevin C. Khasigian are prosecuting the case.
Jeff and Paulette Carpoff are scheduled to be sentenced by U.S. District Judge John A. Mendez on May 19. Jeff Carpoff faces a maximum statutory penalty of 30 years in prison. Paulette Carpoff faces a maximum statutory penalty of 15 years in prison. The actual sentences, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Toledo, Ohio man indicted and arrested for sex trafficking juvenilesRead the Press Release
A Toledo man was arrested January 23, 2020 for sex trafficking two juveniles in Toledo, Ohio.
Tyrone Cannon, aka “Bama,” 24, was indicted January 8, 2020 on two counts of Sex Trafficking of Minors between April and May. One count charges sex trafficking of a 17-year old female juvenile, while the other count charges sex trafficking of a 16-year old female juvenile.
If convicted, the defendant faces a mandatory minimum sentence of 10 years on each count and designation as a sex offender. The sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
The investigation of this matter was conducted by the Federal Bureau of Investigation, Toledo Police Department, and the Northwest Ohio Human Trafficking and Child Exploitation Task Force. The case is being prosecuted by Assistant U.S. Attorneys Tracey Ballard Tangeman and Ranya Elzein.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
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Three Louisiana Residents Charged for Conspiring to File False Tax ReturnsRead the Press Release
A federal grand jury in New Orleans, Louisiana, returned an indictment today charging three Louisiana residents with one count of conspiracy to defraud the United States, 14 counts of aiding and assisting in the preparation of a fraudulent tax return, three counts of wire fraud, and three counts of aggravated identity theft, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and the U.S. Attorney’s Office, Eastern District of Louisiana.
According to the indictment, throughout 2015, Morgan Antoine, Jennifer Austin, and Brittany Patterson conspired to file false tax returns for clients of Pelican Income Tax and Payroll Service, a tax preparation business located in Kenner and Westwego, Louisiana. The coconspirators allegedly prepared client returns reporting false income, false withholdings, and false dependents, in order to cause the Internal Revenue Service (IRS) to pay inflated refunds. The indictment further alleges that the coconspirators charged fees as high as $1,100 for preparing tax returns, which they often deducted from the clients’ refunds.
The indictment also charges that to conceal their involvement in the fraud, the coconspirators filed returns in the name of a third party whose personal identifying information was stolen. Finally, the indictment alleges that Antoine and Patterson each falsified their own personal returns claiming false dependents.
If convicted, Antoine, Austin, and Patterson each face a statutory maximum sentence of five years in prison for the conspiracy charge and three years for each count of aiding and assisting in the preparation of a fraudulent tax return. Antoine and Patterson face an additional twenty years in prison for each count of wire fraud and a two-year mandatory minimum for each count of aggravated identity theft. They also face a period of supervised release, restitution, and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman and the U.S. Attorney’s Office, Eastern District of Louisiana thanked special agents of IRS-Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorney Carter Guice and Trial Attorneys Lauren Castaldi and Jessica Kraft of the Tax Division, who are prosecuting this case.
Additional information about the Tax Division and its enforcement efforts may be found on the Division’s website.
Three Louisiana Residents Charged for Conspiring to File False Tax ReturnsRead the Press Release
WASHINGTON – A federal grand jury in New Orleans, Louisiana, returned an indictment today charging three Louisiana residents with one count of conspiracy to defraud the United States, 14 counts of aiding and assisting in the preparation of a fraudulent tax return, three counts of wire fraud, and three counts of aggravated identity theft, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and the U.S. Attorney’s Office, Eastern District of Louisiana.
According to the indictment, throughout 2015, Morgan Antoine, Jennifer Austin, and Brittany Patterson conspired to file false tax returns for clients of Pelican Income Tax and Payroll Service, a tax preparation business located in Kenner and Westwego, Louisiana. The coconspirators allegedly prepared client returns reporting false income, false withholdings, and false dependents, in order to cause the Internal Revenue Service (IRS) to pay inflated refunds. The indictment further alleges that the coconspirators charged fees as high as $1,100 for preparing tax returns, which they often deducted from the clients’ refunds.
The indictment also charges that to conceal their involvement in the fraud, the coconspirators filed returns in the name of a third party whose personal identifying information was stolen. Finally, the indictment alleges that Antoine and Patterson each falsified their own personal returns claiming false dependents.
If convicted, Antoine, Austin, and Patterson each face a statutory maximum sentence of five years in prison for the conspiracy charge and three years for each count of aiding and assisting in the preparation of a fraudulent tax return. Antoine and Patterson face an additional twenty years in prison for each count of wire fraud and a two-year mandatory minimum for each count of aggravated identity theft. They also face a period of supervised release, restitution, and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman and the U.S. Attorney’s Office, Eastern District of Louisiana thanked special agents of IRS-Criminal Investigation, who conducted the investigation, and Assistant U.S. Attorney Carter Guice and Trial Attorneys Lauren Castaldi and Jessica Kraft of the Tax Division, who are prosecuting this case.
Additional information about the Tax Division and its enforcement efforts may be found on the Division’s website.
Three Aliens Indicted on Illegal Reentry Charges, Illegal and Unlawful Alien in Possession of a Firearm, Visa Fraud, and False Representation of a Social Security NumberRead the Press Release
RALEIGH – Robert J. Higdon, Jr., United States Attorney for the Eastern District of North Carolina announces that a federal grand jury in Raleigh has returned indictments charging CARLOS ROBERTO VAZQUEZ-MORALES, age 27, of Mexico, and JOSE PARTIDA-COYT, age 51, of Mexico with Illegal Reentry of a Deported Alien.
Additionally, the grand jury returned a superseding indictment charging ESTUARDO CAMEY-GONZALEZ, age 50, of Guatemala, with illegal and unlawful alien in possession of a firearm, visa fraud and false representation of a social security number.
If convicted of illegal reentry, VAZQUEZ-MORALES, previously deported twice and found in Carteret County, would face maximum penalties of two years’ imprisonment, a $250,000 fine, and a term of supervised release following any term of imprisonment.
If convicted of illegal reentry subsequent to a felony conviction (identity theft), PARTIDA-COYT, previously deported and found in Johnston County, would face maximum penalties of ten years’ imprisonment, a $250,000 fine, and a term of supervised release following any term of imprisonment.
If convicted of illegal alien in possession of a firearm, visa fraud, and false representation of a social security number, CAMEY-GONZALEZ would face maximum penalties of 65 years imprisonment, a $1,000,000 fine, and a term of supervised release following any term of imprisonment.
The charges and allegations contained in the indictments are merely accusations. The defendants are presumed innocent unless and until proven guilty in a court of law.
ICE’s Enforcement and Removal Operations and Homeland Security Investigations are investigating the cases.
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The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Streamwood Man Sentenced to Nearly 7 Years in Prison for Enticing Underage Boy to Produce Sexually Explicit VideosRead the Press Release
CHICAGO — A Streamwood man was sentenced today to nearly seven years in federal prison for enticing a 16-year-old boy to produce sexually explicit videos of himself.
MICHAEL LIEDTKE, 35, pleaded guilty last year to one count of receipt of child pornography. U.S. District Judge Elaine E. Bucklo imposed a sentence of six years and eleven months in federal prison.
The sentence was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Douglas S. Beidler, Acting Deputy Special Agent-in-Charge of the Chicago office of the FBI; and Robert Berlin, DuPage County State’s Attorney. The Carol Stream Police Department provided valuable assistance. The government was represented by Assistant U.S. Attorneys Abigail Peluso and Matthew McCrobie.
Liedtke admitted in a plea agreement that in December 2016 he enticed the 16-year-old boy to create two sexually explicit videos and send them to Liedtke via cellphone. During a court-authorized search of Liedtke’s home last year, law enforcement discovered an external disk drive that contained 29 images and six videos of children engaged in sexually explicit conduct. Each of the children depicted in the images and videos was identified as a known child victim by the National Center for Missing and Exploited Children.
Liedtke also admitted in the plea agreement that in January 2019 he possessed and operated a video camera that he intentionally hid in the ceiling of a public restroom at the DuPage County Training Academy in Carol Stream. Recordings from the camera depicted the unclothed body parts of approximately 400 people using the restroom, including approximately 300 children under the age of 18. Liedtke acknowledged in the plea agreement that he placed the video camera in the restroom to obtain the images.
After Liedtke pleaded guilty in federal court, the DuPage County State’s Attorney’s Office moved to dismiss the parallel state criminal charges filed against Liedtke.
“My office will continue to prosecute and hold accountable those individuals who prey upon our youth,” said U.S. Attorney Lausch. “We appreciate the outstanding work of our colleagues at the DuPage County State’s Attorney’s Office, as well as our federal, state, and local law enforcement partners, who worked together to bring justice on behalf of the victims in this case.”
“Thanks to the coordinated efforts of law enforcement and prosecutorial partners at all levels, Mr. Liedtke will be held accountable for victimizing hundreds of our community’s most vulnerable citizens,” said FBI Acting Deputy SAC Beidler. “The FBI will always strive to safeguard our youth from those who seek to exploit them.”
“I would like to thank the U.S. Attorney’s Office for their work in removing this sexual predator from society,” DuPage County State’s Attorney Berlin said. “Mr. Liedtke’s deviant actions demonstrate his complete disregard for others and society as a whole. While this has been a very disturbing case, Mr. Liedtke’s guilty plea and nearly seven-year sentence underscores the close partnership shared by local and federal authorities working together to keep our communities safe.”
If you believe you are a victim of sexual exploitation, you are encouraged to contact the National Center for Missing and Exploited Children by logging on to www.missingkids.com/home or by calling 1-800-843-5678. The service is available 24 hours a day, seven days a week.
St. Croix Resident Who Supplied over 20 Kilos of Cocaine at the Cyril E. King Airport for Transport Pleads Guilty to Drug Possession with Intent to DistributeRead the Press Release
St. Thomas, USVI –Jakwaan Sweeny, Jr., 21, of St. Croix, pleaded guilty in District Court before Judge Curtis Gomez, to possession with intent to distribute cocaine, United States Attorney Gretchen C.F. Shappert announced.
According to court records, on September 24, 2018, Sweeney provided Shahime Ludvig, Jr. with 22.78 kilos of cocaine at the Cyril E. King Airport and a plane ticket to Atlanta. The cocaine was packaged as 20 individualized bricks and placed in a checked bag. Once in Atlanta, the coconspirator was to deliver the cocaine to another member of the cocaine conspiracy.
On the day of travel, Sweeney’s co-conspirator entered the Cyril E. King Airport and checked the bag for the flight. During a routine screening, a specially trained narcotics detection canine "alerted" on the bag. Customs and Border Protection officers in St. Thomas opened the bag and discovered the cocaine. Homeland Security Investigations arrested Ludvig prior to him boarding the flight. Ludvig entered a guilty plea in federal court in 2018.
Under federal law, Sweeney faces a minimum sentence of 10 years in prison and a maximum fine of $10,000,000.
This case was investigated by Homeland Security Investigations. It is being prosecuted by Assistant United States Attorney Everard E. Potter.
South Bend, Indiana Man Entered Plea of GuiltyRead the Press Release
SOUTH BEND – United States Attorney Thomas L. Kirsch, II announced that Christopher Kinds, 34, of South Bend, Indiana pled guilty before United States District Court Judge Damon Leichty, sitting in South Bend. Kinds admitted to possessing over 500 grams of methamphetamine with the intent to distribute, and he admitted to possessing a firearm after having been convicted of a felony.
According to documents filed in this case, on September 5, 2019, investigators searched Mr. Kinds’ home and storage units at a rental facility, all in South Bend. Investigators arrested Mr. Kinds the same day. Investigators recovered over 2 kilograms of methamphetamine from his home and 37 firearms from him, his home, and his storage units. Mr. Kinds has a 2006 felony conviction in St. Joseph County where he was sentenced to 4 years in prison.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives with the assistance of the South Bend Police Department, St. Joseph County Drug Investigations Unit, and St. Joseph County SWAT Team. The case was handled by Assistant U.S. Attorneys Molly Donnelly and Kim Schultz.
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Sixth and Final Defendant Sentenced to Prison for Sophisticated International Cellphone Fraud SchemeRead the Press Release
A citizen and resident of the Dominican Republic was sentenced today in Miami, Florida, to 65 months in prison for multiple criminal charges in connection with a sophisticated global cellphone fraud scheme that involved compromising cellphone customers’ accounts in the United States and “cloning” their phones to make fraudulent international calls.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Ariana Fajardo Orshan of the Southern District of Florida and Special Agent in Charge George L. Piro of the FBI’s Miami Field Office made the announcement.
Edgar Estarlin Peralta Lopez, 42, pleaded guilty earlier to one count of conspiracy to commit wire fraud, access device fraud, the use, production or possession of modified telecommunications instruments and the use or possession of hardware or software configured to obtain telecommunications services; one count of wire fraud and one count of aggravated identity theft. He was sentenced by U.S. District Judge Beth Bloom of the Southern District of Florida.
According to the plea agreement, Peralta and his co-conspirators participated in a scheme to steal access to existing cellphone accounts, and fraudulently open new cellphone accounts, using the personal information of individuals around the United States.
Peralta admitted that he played at least two roles in the conspiracy. First, he was a telecommunications trafficker. Specifically, Peralta would contract with telecommunication companies to transmit international calls for them for payment and then route those calls through cellphones reprogrammed with stolen or compromised telecommunications identifying information located at “call sites” in the United States. Peralta and other co-conspirators transmitted thousands of calls to Cuba, Jamaica, the Dominican Republic and other countries with high calling rates. The calls were later billed to United States customers’ compromised accounts. Second, Peralta was a “line” supplier, providing his co-conspirators with stolen or compromised telecommunications identifying information that they then used to reprogram the cellphones they controlled at call sites.
In addition, Peralta admitted to trafficking in approximately 3,158 combinations of stolen or compromised telecommunications identifying information, which were found in around over 1,390 emails he exchanged with co-conspirators. Verizon Wireless reported that fraudulent use of just three of these combinations resulted in a loss of over $33,000. Peralta admitted to a loss amount of at least $315,800.
Peralta is a citizen of the Dominican Republic. He was arrested in the Dominican Republic at the request of the United States and then, in August 2019, extradited to Miami where he is currently in custody.
Peralta is the sixth and last defendant to be sentenced in the case. Previously, defendants Edwin Fana, Farintong Calderon, Jose Santana, Ramon Batista and Braulio de la Cruz pleaded guilty to similar charges and have already been sentenced to prison terms ranging from 36 months to 75 months.
The FBI Miami’s Cyber Task Force investigated the case, dubbed Operation Toll Free, which is part of the FBI’s ongoing effort to combat large-scale telecommunications fraud. The Criminal Division’s Office of International Affairs handled the extradition in this matter, with assistance from the U.S. Marshals Service. Senior Counsel Matthew A. Lamberti of the Criminal Division’s Computer Crime and Intellectual Property Section is prosecuting the case.
Seaford Man Pleads Guilty to Tax ChargeRead the Press Release
WILMINGTON, Del. – A Seaford man pleaded guilty today to filing a false tax return.
According to court documents, Lorne “Bob” Adams, 49, filed a false 2015 Federal Income Tax Return, omitting approximately $165,000 in income. Pursuant to his plea agreement, Adams further admitted to outstanding tax liabilities for 2013, 2014, and 2016. In total, Adams agreed to make restitution to the Internal Revenue Service totaling $112,628.00.
Adams pleaded guilty to Making False Statements on a Tax Return, and faces a maximum penalty of 3 years in prison when sentenced on May 29, 2020. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
“Lorne Adams’ failure to report all of his income is a felony offense that carries severe consequences,” said IRS Criminal Investigation Special Agent in Charge Guy Ficco. “As we approach the beginning of tax filing season, would-be tax cheats are reminded that engaging in similar criminal behavior could result in a prison sentence.”
David C. Weiss, U.S. Attorney for the District of Delaware, made the announcement after U.S. District Judge Richard G. Andrews accepted the plea. Assistant U.S. Attorney Lesley F. Wolf is prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the District of Delaware. Related court documents and information is located on the website of the District Court for the District of Delaware or on PACER by searching for Case No. 1:19-cr-143.
San Francisco Man Sentenced to More Than 16 Years in Prison for Crimes Related to Illegal Fentanyl Pill Manufacturing OperationRead the Press Release
SAN FRANCISCO - Kia Zolfaghari was sentenced today to 200 months in prison for conspiring to distribute fentanyl, announced United States Attorney David L. Anderson and Drug Enforcement Administration Special Agent in Charge Daniel C. Comeaux. The sentence was handed down by the Honorable Susan Illston, Senior United States District Judge.
Zolfaghari, 43, of San Francisco, pleaded guilty to the fentanyl conspiracy charge as well as weapons and money laundering charges on July 12, 2019. According to his plea agreement, Zolfaghari admitted that from May of 2014 until June of 2016 he agreed with others to distribute and possess with intent to distribute fentanyl.
Fentanyl, a Schedule II controlled substance, is a highly potent opiate that can be diluted with cutting agents to create counterfeit pills that attempt to mimic the effects of oxycodone. Typically, counterfeit pills made with fentanyl can be obtained at a lower cost than genuine oxycodone. However, small variations in the amount or quality of fentanyl can have significant effects on the potency of the counterfeit pills, raising the danger of overdoses. The San Francisco medical examiner’s office recently reported a large spike in fentanyl-related deaths—in 2019, 234 deaths in San Francisco are estimated to have involved fentanyl, compared with 90 in 2018.
In this case, Zolfaghari admitted that his role in the conspiracy included buying a pill press, using it to manufacture pills, and selling the pills, principally online. Zolfaghari admitted he stamped the pills in a manner consistent with genuine oxycodone and advertised the pills as oxycodone, but that the pills did not contain oxycodone and instead contained fentanyl.
In his plea agreement, Zolfaghari also described the roles of two of his co-conspirators in the drug trafficking conspiracy. For example, Zolfaghari acknowledged that one of his co-conspirators assisted him in the operation by packaging and mailing pills as well as cleaning up after he manufactured the pills. Additionally, Zolfaghari explained that another co-conspirator assisted him by maintaining a post office box for the delivery of the fentanyl powder that he used to make pills and by delivering the powder that arrived in that post office box. Zolfaghari admitted that over the course of the conspiracy he made over $400,000 through his sales, and sold at least 13,000 fentanyl pills. As described below, Zolfaghari spent the proceeds of his drug trafficking enterprise on luxury goods.
Zolfaghari also pleaded guilty to conspiring to launder the proceeds of the drug trafficking operation. Specifically, Zolfaghari admitted that sometime before May 1, 2014, he agreed with others to engage in several financial transactions to conceal the source and ownership of the proceeds of his drug sales. For example, he arranged to be paid in the digital currency bitcoin; he used unlicensed bitcoin brokers to exchange the bitcoin for cash; and he directed a co-conspirator to purchase gift cards with the cash. Zolfaghari further admitted that these transactions were intended to conceal the source and ownership of the funds. Zolfaghari also admitted he used the proceeds from his drug trafficking operation to make a $40,000 down payment (and additional monthly payments) on a 2015 Audi RS5 Coupe, which retailed for close to $80,000; to make payments on an apartment in San Francisco; and to purchase luxury goods such as high-end watches, designer shoes, and jewelry.
Zolfaghari was arrested on June 10, 2016. At the time of his arrest, Zolfaghari was found in possession of a Smith & Wesson handgun and 500 pills containing fentanyl.
On November 29, 2016, a federal grand jury returned a superseding indictment against Zolfaghari, charging him with four counts of distribution and possession with intent to distribute fentanyl, in violation of 21 U.S.C. §§ 841(a)(1) and (b)(1)(B); four counts of distribution and possession with intent to distribute 40 grams or more of fentanyl, in violation of 21 U.S.C. §§ 841(a)(1) and (b)(1)(B); four counts of engaging in money laundering in violation of 18 U.S.C. § 1957; and one count each of conspiracy to manufacture, to possess with intent to distribute, and to distribute 400 grams or more of fentanyl, in violation of 21 U.S.C. § 846; using, carrying, or possessing a firearm during and in relation to a drug trafficking crime, in violation of 18 U.S.C. § 924(c); and conspiracy to launder drug proceeds, in violation of 18 U.S.C. § 1956(h). Also charged in the case were King Edward Harris, II, 37, of Oxnard, and Zolfaghari’s wife, Candelaria Dagandan Vazquez, 44.
In April 2017, Zolfaghari and Vazquez jumped bail and failed to appear for hearings in this case. In February 2019, the United States Marshals Service and the Mexican Federal Police located Zolfaghari and Vazquez in Mexico and returned them to the United States.
In addition to the prison term, Judge Illston sentenced Zolfaghari to a five-year period of supervised release to follow his prison term, and ordered him to pay a $300 special assessment.
On February 9, 2018, Judge Illston sentenced Vazquez to 151 months imprisonment for her role in the conspiracy. On September 22, 2017, Judge Illston sentenced Harris to five years in prison for possession and distribution of 40 grams or more of fentanyl.
Assistant U.S. Attorney Nikhil Bhagat is prosecuting the case with the assistance of Linda Love. The prosecution is the result of an investigation by the Drug Enforcement Administration, Homeland Security Investigations, the Internal Revenue Service Criminal Investigation Division, the United States Postal Inspection Service, and U.S. Customs and Border Protection, with assistance from the United States Marshals Service, the San Francisco Police Department, the San Francisco Fire Department, and the Mexican Federal Police. This case is the product of an extensive investigation by the Organized Crime Drug Enforcement Task Force, a focused multi-agency, multi-jurisdictional task force investigating and prosecuting the most significant drug trafficking organizations throughout the United States by leveraging the combined expertise of federal, state and local law enforcement agencies.
Real Estate Developer Pleads Guilty to Bank Fraud, Aggravated Identity TheftRead the Press Release
PROVIDENCE, RI – A former construction project manager for a Newport-based real estate development company pled guilty in federal court in Providence on Thursday to twelve counts of bank fraud and two counts of aggravated identity theft charges, admitting that he created a scheme that defrauded banks, construction companies, and his employer of more than $200,000.
Gregory Meeker, 57, of Barrington, who oversaw various real estate development projects for Landings Real Estate Group (Landings), including the Newport Beach Club and Long Meadow Landings projects, admitted that two months after being employed by Landings in December 2015, he devised a scheme to submit invoices to Landings, many of which were false or inflated, in the names of subcontractors. Landings made checks payable to the subcontractors that were then provided to Meeker for delivery. Instead of delivering the checks to the subcontractors, Meeker forged endorsements on the back of the checks and deposited them into his own bank account.
Meeker admitted that in some instances, false invoices and subsequently forged endorsements on checks bore the names of individual subcontractors as opposed to business names, including at least two individuals known to him.
Meeker also admitted that he provided Landings with false paperwork related to GMC Construction, an entity he previously operated, including a false name and address, and a Social Security number of an unrelated individual. He prompted Landings to issue over $12,000 in checks to GMC Construction, which he endorsed and deposited into his own bank accounts.
Additionally, Meeker admitted that he forged the endorsement of the Town of Portsmouth on the back of three checks made payable to “Town of Portsmouth – Inspection Department.” He deposited the checks into one of four bank accounts he used for his fraudulent activity.
Gregory Meeker’s guilty plea before U.S. District Court Judge Mary S. McElroy to twelve counts of bank fraud and two counts of aggravated identity is announced by United States Attorney Aaron L. Weisman and Special Agent in Charge of the FBI Boston Division Joseph R. Bonavolonta.
Meeker is scheduled to be sentenced on April 7, 2020.
Bank Fraud is punishable by statutory penalties of up to thirty years' imprisonment, five years' supervised release, and a fine of $1,000,000. Aggravated identity theft is punishable by a term of imprisonment of two years, to be served consecutive to any other term of incarceration ordered in this matter, to be followed by one year supervised release.
The case, investigated by the Federal Bureau of Investigation, is being prosecuted by Assistant United States Attorneys Sandra R. Hebert and Christine D. Lowell.
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Press Conference to Follow Sentencing of Pair from West Virginia in Kidnapping of Elderly VictimsRead the Press Release
Knoxville, Tenn. – Joshua Small, 52, and Joni Amber Johnson, 36, both of Princeton, West Virginia, are scheduled for sentencing on January 27, 2020, for their roles in a conspiracy to assault, kidnap and rob elderly victims The sentencing hearing is scheduled for 10:00 a.m. before the Honorable Chief Judge Pamela Reeves in the United States Courthouse in Knoxville.
From May 2018 to July 2018, Small and Johnson went on a spree of armed home invasions and kidnappings throughout West Virginia, Virginia, and East Tennessee. Small and Johnson targeted the homes of elderly victims, forcing entry into their residences, holding victims at gunpoint, and binding their hands and feet. Small and Johnson would then ransack the homes, stealing jewelry, valuables, heirlooms, and cash.
The home invasions were noteworthy for the egregious amount of violence directed towards the victims. In a home invasion in Dandridge, Tennessee, Small struck a 72-year-old male victim in the neck, bound his hands and feet with power cords, and shoved him down a flight of stairs into the basement. During a home invasion in Princeton, West Virginia, the two surreptitiously entered the home of an 88-year-old woman, holding her at gunpoint and ripping off her Life Alert necklace. Small then struck her in the head, knocking her unconscious and causing a substantial injury before fleeing the home with her pocket book. In Jefferson County, Tennessee, Small and Johnson forced their way into an 81-year-old man’s home, struck him in the head and neck, bound his hands and feet, gagged him, robbed him of $3,200 and fled. In total, Small and Johnson attacked, terrorized, kidnapped and robbed seven elderly victims.
Immediately following the sentencing hearing in this matter, U.S. Attorney J. Douglas Overbey and FBI Special Agent in Charge Joseph Carrico will make a statement and take questions from the media outside the Courthouse.
Assistant United States Attorneys Alan Kirk and Kevin Quencer represented the United States at trial and will continue to do so at sentencing.
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Plummer Man Pleads Guilty to StrangulationRead the Press Release
COEUR D’ALENE – Brian Quilly Lozon, 40, of Plummer, Idaho, pleaded guilty to strangulation of an intimate partner, U.S. Attorney Bart M. Davis announced today. Sentencing for Lozon is set for April 10, 2020, before U.S. District Judge B. Lynn Winmill at the federal courthouse in Coeur d’Alene.
According to court records, Lozon and the victim were in multiple altercations in June 2019. During one of these altercations, Lozon used his hands to grab the victim by the throat and impeded her ability to breathe. Later, during the same altercation, Lozon used his forearm to again apply pressure to her throat. Eventually the victim was able to get away from Lozon and seek help.
Strangulation is punishable by up to 10 years in federal prison, a fine of up to $250,000, and a term of supervised release of up to three years.
This case was investigated by Federal Bureau of Investigation and Coeur d’Alene Tribal Police Department.
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Pittsburgh Felon with Nazi Obsession Charged with Illegal Possession of a FirearmRead the Press Release
PITTSBURGH, PA - A criminal complaint has been filed in federal court against a resident of Pittsburgh, Pa., charging him with possession of a firearm by a convicted felon, United States Attorney Scott W. Brady announced today.
The one-count Criminal Complaint named Dennis Alan Riggs, 50, as the sole defendant. Riggs made his initial appearance in federal court on Wednesday. Today he appeared before U.S. Magistrate Judge Lisa Pupo Lenihan. Riggs waived his preliminary exam and was ordered detained following the presentation of evidence by the government during his detention hearing.
According to the Criminal Complaint, on January 22, 2020 at approximately 6 a.m., FBI Special Agents and Task Force Officers executed a federal search warrant at 1540 Hatteras Street on Pittsburgh’s North Side as part of an ongoing investigation. During the search, law enforcement located seven firearms: a Ruger .223 Caliber AR-15 style rifle; a Ruger .22 caliber revolver; a Harrington & Richardson shotgun; a .38 special revolver; a Colt .38 Caliber revolver; a US revolver, 32 Caliber, which was loaded and with the hammer cocked; and a Harrington & Richardson shotgun. Agents also located multiple rounds of ammunition in the residence. Riggs is prohibited from possessing a firearm because he was convicted on March 30, 1994, of Aggravated Assault in the Court of Common Pleas of Allegheny County. Federal law prohibits an individual who has been convicted of a felony from possessing a firearm or ammunition.
According to information presented at the detention hearing, Riggs was aware that he was prohibited from possessing a weapon due to a prior felony conviction. Agents found on his phone a video depicting Riggs wearing Nazi apparel, offering Nazi salutes and loading and unloading an AR-15 style rifle; a video of the 2019 Christchurch, New Zealand mosque shootings which killed 51; images of the defendant with firearms; and a photograph of Dylann Roof with his current Bureau of Prisons contact information. Roof was convicted in the 2015 massacre at Emanuel African Methodist Episcopal Church in Charleston, South Carolina. Riggs decorated his house with Nazi and Hitler posters and pictures; possessed numerous other weapons, knives and daggers; and had hundreds of bottles of liquor and alcohol. The government also presented evidence showing six of the seven guns found during the search were loaded.
"Riggs’s Nazi videos, photos and paraphernalia clearly show his obsession with hate-based violence. His cache of firearms clearly shows his capability to act on that obsession," U.S. Attorney Brady said. "Our Office is committed to identifying, disrupting and preventing such potential threats to our community."
"This is a coordinated effort to keep our community safe," said FBI Pittsburgh Special Agent in Charge Robert Jones. "I commend our Joint Terrorism Task Force (JTTF), which includes our local, state and federal partners, for their investigative efforts in identifying and arresting this suspect. The FBI uses all of our resources to make sure firearms are kept out of the hands of those prohibited from having them."
The law provides for a maximum term of imprisonment of 20 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Jessica L. Smolar is prosecuting this case on behalf of the government.
The FBI Pittsburgh Joint Terrorism Task Force conducted the investigation leading to the criminal complaint in the case. Members of the FBI’s Joint Terrorism Task Force who were directly involved in this investigation include: FBI, Pennsylvania State Police, Allegheny County Police Department, Allegheny County Probation, and the Pittsburgh Bureau of Police.
A criminal complaint is only a charge and is not evidence of guilt. A defendant may not be prosecuted unless, within 30 days, a grand jury has found probable cause to believe that the defendant is guilty of an offense.
Pittsburgh Felon with Nazi Obsession Charged with Illegal Possession of a FirearmRead the Press Release
PITTSBURGH, PA - A criminal complaint has been filed in federal court against a resident of Pittsburgh, Pa., charging him with possession of a firearm by a convicted felon, United States Attorney Scott W. Brady announced today.
The one-count Criminal Complaint named Dennis Alan Riggs, 50, as the sole defendant. Riggs made his initial appearance in federal court on Wednesday. Today he appeared before U.S. Magistrate Judge Lisa Pupo Lenihan. Riggs waived his preliminary exam and was ordered detained following the presentation of evidence by the government during his detention hearing.
According to the Criminal Complaint, on January 22, 2020 at approximately 6 a.m., FBI Special Agents and Task Force Officers executed a federal search warrant at 1540 Hatteras Street on Pittsburgh’s North Side as part of an ongoing investigation. During the search, law enforcement located seven firearms: a Ruger .223 Caliber AR-15 style rifle; a Ruger .22 caliber revolver; a Harrington & Richardson shotgun; a .38 special revolver; a Colt .38 Caliber revolver; a US revolver, 32 Caliber, which was loaded and with the hammer cocked; and a Harrington & Richardson shotgun. Agents also located multiple rounds of ammunition in the residence. Riggs is prohibited from possessing a firearm because he was convicted on March 30, 1994, of Aggravated Assault in the Court of Common Pleas of Allegheny County. Federal law prohibits an individual who has been convicted of a felony from possessing a firearm or ammunition.
According to information presented at the detention hearing, Riggs was aware that he was prohibited from possessing a weapon due to a prior felony conviction. Agents found on his phone a video depicting Riggs wearing Nazi apparel, offering Nazi salutes and loading and unloading an AR-15 style rifle; a video of the 2019 Christchurch, New Zealand mosque shootings which killed 51; images of the defendant with firearms; and a photograph of Dylann Roof with his current Bureau of Prisons contact information. Roof was convicted in the 2015 massacre at Emanuel African Methodist Episcopal Church in Charleston, South Carolina. Riggs decorated his house with Nazi and Hitler posters and pictures; possessed numerous other weapons, knives and daggers; and had hundreds of bottles of liquor and alcohol. The government also presented evidence showing six of the seven guns found during the search were loaded.
"Riggs’s Nazi videos, photos and paraphernalia clearly show his obsession with hate-based violence. His cache of firearms clearly show his capability to act on that obsession," U.S. Attorney Brady said. "Our Office is committed to identifying, disrupting and preventing such potential threats to our community."
"This is a coordinated effort to keep our community safe," said FBI Pittsburgh Special Agent in Charge Robert Jones. " I commend our Joint Terrorism Task Force (JTTF), which includes our local, state and federal partners, for their investigative efforts in identifying and arresting this suspect. The FBI uses all of our resources to make sure firearms are kept out of the hands of those prohibited from having them."
The law provides for a maximum term of imprisonment of 20 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Jessica L. Smolar is prosecuting this case on behalf of the government.
The FBI Pittsburgh Joint Terrorism Task Force conducted the investigation leading to the criminal complaint in the case. Members of the FBI’s Joint Terrorism Task Force who were directly involved in this investigation include: FBI, Pennsylvania State Police, Allegheny County Police Department, Allegheny County Probation, and the Pittsburgh Bureau of Police.
A criminal complaint is only a charge and is not evidence of guilt. A defendant may not be prosecuted unless, within 30 days, a grand jury has found probable cause to believe that the defendant is guilty of an offense.
Pawtucket Man Admits to Foreign Travel to Engage in Sex with a Minor, Transferring Obscene Material, Receiving Child PornographyRead the Press Release
PROVIDENCE – A Pawtucket man appeared in U.S. District Court in Providence today and admitted to a judge that he traveled to Canada in April 2019, to engage in illicit sexual activity with a 13-year-old female he befriended on social media.
Herbert J. Rodas, 23, also admitted that he sent the girl obscene photographs of himself and that he successfully encouraged her to send him sexually explicit photographs of herself.
Appearing before U.S. District Court Judge Mary S. McElroy, Rodas pleaded guilty to engaging in illicit sexual conduct with a minor in foreign places, transferring obscene material to a minor, and receipt of child pornography, announced United States Attorney Aaron L. Weisman, Homeland Security Investigations Acting Special Agent in Charge Jason Molina, and Rhode Island State Police Superintendent Colonel James M. Manni.
In June 2019, the Winnipeg Police Service contacted the Rhode Island State Police Internet Crimes Against Children Task Force (ICAC) and Homeland Security Investigations (HSI) in Providence to report the sexual assault of a 13-year-old female. Winnipeg Police developed information that Rodas had travelled from the United States to Canada to engage in sexual activity with the minor victim with whom he had been communicating online since January 2019.
Today, Rodas admitted to the court that on April 25, 2019, he flew to Canada, rented a hotel room in his name for which he paid cash, and over the next three days he met with the victim on several occasions to engage in illicit sexual activity.
On July 11, 2019, ICAC Task Force members and HSI agents arrested Rodas. A court-authorized search of Rodas’ Pawtucket residence that day resulted in the seizure of Rodas’ passport, an airline boarding pass from Toronto to Boston for Rodas’ return trip from Canada in April 2019, a Super 8 Motel receipt, and several electronic devices.
He is scheduled to be sentenced on April 25, 2020.
Engaging in illicit sexual conduct with a minor in foreign places is punishable by up to 30 years imprisonment and lifetime supervised release. Transferring obscene material to a minor is punishable by up to 10 years’ imprisonment and 5 years’ supervised release. Receipt of child pornography is punishable by a term of incarceration of 5-30 years, to be followed by lifetime supervised release.
The case is being prosecuted by Assistant United States Attorney John P. McAdams.
United States Attorney Aaron L. Weisman thanks the Winnipeg Police Service for their assistance in the investigation of this matter.
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Owner of Kitsap County guardianship business pleads guilty to stealing from disabled and elderly clientsRead the Press Release
Tacoma – A Kitsap County man who ran a business serving as a financial guardian for elderly or disabled clients pleaded guilty today in U.S. District Court in Tacoma to Social Security Fraud – Representative Payee Fraud. WAYNE JEROME HOUSTON, 61, of Port Ludlow, Washington owned and operated Cross Point Services LLC, a guardianship organization for disabled and vulnerable adults. Between November 2010 and December 2018, HOUSTON stole as much as $280,000 from client accounts and used the money for his own expenses. HOUSTON is scheduled for sentencing by U.S. District Judge Ronald B. Leighton on April 17, 2020.
“This defendant stole from those he was supposed to protect at least 240 separate times,” said U.S. Attorney Brian T. Moran. “He betrayed the clients who needed his help, as well as the Kitsap County Superior Court Judges who appointed him, believing he could be trusted to make sure disabled and vulnerable adults were protected.”
According to the plea agreement, HOUSTON and his company were responsible for managing the financial affairs of 15-20 clients a month. HOUSTON had access to the clients’ bank accounts so he could pay rent, utilities and other bills for them. Social Security benefits were paid into some of the accounts, for at least 13 clients who required a representative payee to manage their benefits. HOUSTON was the representative payee for at least 13 disabled clients. Beginning in 2010, HOUSTON used his position as guardian to write checks from the victim accounts to himself, to Cross Point Services, or to cash, and used ATMs to withdraw money from client accounts and used it for his own expenses. HOUSTON targeted clients who had significant income or resources so that the theft was less likely to be detected.
The amount stolen is still under investigation but is between $150,000 and $280,941. Of that, approximately $83,000 was Social Security Administration benefit funds.
Social Security Fraud – Representative Payee Fraud is punishable by up to 5 years in prison and a $250,000 fine. Under the terms of the plea agreement prosecutors will recommend no more than 40 months in prison. Judge Leighton is not limited by the recommendation and the ultimate sentence will be determined by the Court based on the advisory Sentencing Guidelines and other statutory factors.
The case was investigated by the Social Security Administration Office of Inspector General (SSA-OIG) and the Kitsap County Sheriff’s Office. The case is being prosecuted by Special Assistant United States Attorney Benjamin Diggs. Mr. Diggs is an attorney with the Social Security Administration specially designated to prosecute fraud cases in federal court.
Owings Mills Man Pleads Guilty to Federal Charge of Possessing A Firearm in Furtherance of Drug TraffickingRead the Press Release
Baltimore, Maryland – Timothy Herndon, age 29, of Owings Mills, Maryland, pleaded guilty on January 22, 2020 to possession of a firearm in furtherance of a drug trafficking crime.
The guilty plea was announced by United States Attorney for the District of Maryland Robert K. Hur and Acting Special Agent in Charge Toni Crosby of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Baltimore Field Division.
United States Attorney Robert K. Hur stated, “Timothy Herndon brought danger to our community through the deadly combination of guns and drugs. Now he likely eight years in federal prison, where there is no parole—ever. Please, put down the guns and save a life—maybe even your own.”
According to the plea agreement, on the morning of May 16, 2019, ATF Special Agents executed a search warrant at Herndon’s residence in Owings Mills. After being read his Miranda warnings, Herndon told agents that he had placed a firearm in a shoebox in the second-floor bedroom. Agents recovered that firearm, then searched the rest of the residence.
In the living room, agents recovered one clear bag containing multiple black plastic zip lock baggies of cocaine base (crack) and approximately $2,000 in U.S. currency. In the kitchen trashcan under the trash bag, they found additional small black zip lock baggies of cocaine base (crack), a black shopping bag containing razor blades, multiple clear plastic bags, and one round of 9-millimeter ammunition.
From underneath the dishwasher, agents recovered the following: three loaded firearms; two clear plastic sandwich bags containing cocaine; additional drug paraphernalia; and a paper bag containing a large amount of United States currency. Agents found a total of nearly $40,000 in cash inside of the residence.
Herndon and the government have agreed that, if the Court accepts the plea agreement, Herndon will be sentenced to 96 months (8 years) in federal prison. U.S. District Judge Ellen L. Hollander has scheduled sentencing for March 27, 2020 at 2:00 p.m.
United States Attorney Robert K. Hur commended the Bureau of Alcohol, Tobacco, Firearms and Explosives for their work in the investigation. Mr. Hur thanked Assistant U.S. Attorneys Zachary Stendig and Lindsey McCulley, who are prosecuting the case.
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Operation Shutdown Corner Update: Two Defendants Enter Guilty Pleas to Federal Drug CrimesRead the Press Release
BECKLEY, W.Va. – Two men pled guilty today for their participation in a drug trafficking operation in Raleigh County, announced United States Attorney Mike Stuart. David Dove, 49, of Scarbro, pled guilty to conspiracy to distribute 50 grams or more of a substance containing methamphetamine, while Christopher Redden, 40, of Beckley, entered guilty pleas to conspiracy to distribute a quantity of a substance containing methamphetamine and being an unlawful drug user in possession of a firearm. Dove and Redden were charged as a result of a long-term investigation known as Operation Shutdown Corner.
“Operation Shutdown Corner did just that – it shut down a significant meth trafficking organization,” announced United States Attorney Mike Stuart. “Meth is now the most pressing drug problem in my District. We’re fighting back through successful joint law enforcement efforts like this that dismantle significant drug trafficking organizations bringing large amounts of meth into our region.”
Dove admitted that between June 2018, and September 17, 2019, he worked with other members of a drug trafficking organization (DTO) operating in Raleigh County, West Virginia to distribute methamphetamine. Dove admitted that during this time period he supplied other members of the drug trafficking organization with distribution quantities of methamphetamine knowing that it the other members would resell the methamphetamine illegally. Dove admitted he was participating in recorded conversations regarding drug activity and to meeting with other members of the DTO to distribute and exchange controlled substances. Dove also admitted that when he was arrested, law enforcement officers found two “eight-balls” of methamphetamine that he intended to distribute. Dove admitted that he was responsible for distributing between 1.5 kilograms and 5 kilograms of methamphetamine during this time period.
Christopher Redden admitted that between January 2019 and September 17, 2019, he participated in the drug trafficking organization by working with Stephanie McClung and others to distribute methamphetamine and heroin within the Southern District of West Virginia. During this time period, Redden admitted to obtaining approximately 50 grams of methamphetamine a month and a quantity of heroin that he intended to re-distribute. Redden admitted that at times he was “fronted” the drugs, or given drugs without paying for them, and then selling the drugs for profit to pay back the supplier. Other times he admitted to paying for the drugs up front. Additionally, Redden admitted that on September 18, 2019 when he was arrested, he was in possession of a Taurus, model G2C, 9mm semi-automatic pistol that he had received as payment for methamphetamine. He also admitted that at the time he possessed the firearm he knew he was an unlawful user of controlled substances and therefore prohibited from possessing any firearms.
Stuart commended the cooperative investigative efforts of the Federal Bureau of Investigation (FBI), the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the United States Postal Inspection Service (USPIS), the Beckley/Raleigh County Drug and Violent Crimes Task Force, the Raleigh County Sheriff’s Office, the Beckley Police Department, and the West Virginia State Police.
Both Dove and Redden are scheduled to be sentenced on May 4, 2020. Dove faces a mandatory minimum period of five years and up to forty years in prison and a $5 million fine. Redden faces up to thirty years for the drug and gun charge and a fine of up to $1,250,000.
Assistant United States Attorney Timothy D. Boggess is in charge of the prosecutions. United States District Judge Frank W. Volk presided over the hearings.
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Operation Fall of the House of Usher Helps Dismantle Multi-State Methamphetamine Drug Trafficking OrganizationRead the Press Release
WILMINGTON – United States Attorney Robert J. Higdon, Jr. announced that over the course of the last several months in federal court, 32 defendants have been sentenced in a large-scale methamphetamine trafficking investigation.
The investigation was part of an Organized Crime Enforcement Task Force (OCDETF) investigation entitled Operation “Fall of the House of Usher,” which was undertaken in direct response to the explosion of kilogram amounts of extremely potent methamphetamine (with purities as high as 99%) being imported into Duplin, Sampson and New Hanover Counties. According to the DEA, the methamphetamine was so pure that some users reported consuming heroin to counter balance the effects. The initial focus of the investigation was WILLIAM USHER who imported multiple kilograms of methamphetamine from at least four separate Drug Trafficking Organizations in California and Georgia.
An OCDETF investigation is a joint federal, state, and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional level drug trafficking organizations, and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.
This case is a classic example of the combining of an OCDETF operation with our Take Back North Carolina Initiative. DEA and FBI task force officers were able to identify members and associates of this large scale organization and then partner with the United States Attorney’s Office to develop a strategy to dismantle this organization. After being armed with local intelligence, law enforcement was able to utilize the substantial resources and tools of the federal government to help break the back of this organization. The success of this case would not have been possible without these partnerships.
The defendants’ convictions and sentencings were the culmination of an investigation that started in early 2017 focusing on the shift from local clandestine methamphetamine labs to high purity methamphetamine produced on a large scale outside North Carolina and being smuggled into Eastern North Carolina. As part of the investigation, federal and local law enforcement conducted controlled purchases of methamphetamine and heroin, executed search warrants and conducted traffic stops. Information was also used to make arrests in California and South Carolina.
Forty-one defendants were charged in this investigation, forty have pled guilty in federal court, and thirty-two have been sentenced to date. One defendant, Brandon Dudley, went to trial and was convicted by a jury. He is currently pending sentencing. Of the thirty-two defendants sentenced, the combined sentence for all defendants is 3,351 months, which equates to an average sentence for this operation to 104 months. According to law enforcement, the organization was responsible for the importation and distribution of more than 50 kilograms of methamphetamine. A total of 40 firearms and more than $400,000.00 in currency and property have been seized.
Some of the defendants include:
- WILLIAM USHER, 33, of Duplin County, NC. USHER pled guilty to conspiracy to possess with intent to distribute 500 grams or more of methamphetamine, Possession with intent to distribute 50 grams or more of methamphetamine, distribution of a quantity of methamphetamine (aiding and abetting) and possession of a firearm in furtherance of a drug trafficking crime. USHER was sentenced to 180 months’ imprisonment.
- KEVIN WHITE, 42, of Duplin County, NC. WHITE pled guilty to Conspiracy to Possess With Intent to Distribute 50 Grams or More of Methamphetamine, Distribution of a Quantity of Methamphetamine, Possession With Intent to Distribute a Quantity of Methamphetamine and Possession of a Firearm in Furtherance of a Drug Trafficking Crime. WHITE was sentenced to 132 months’ imprisonment.
- KEVIN FAIRCLOTH, 38, of Duplin County, NC, pled guilty to Conspiracy to Possess With Intent to Distribute 500 Grams or More of Methamphetamine, Possession With Intent to Distribute a Quantity of Methamphetamine and Possession of a Firearm in Furtherance of a Drug Trafficking Crime. FAIRCLOTH was sentenced to 144 months’ imprisonment.
- ERIC HERNANDEZ, 24, of Sampson County, NC, pled guilty to Possession With Intent to Distribute a Quantity of Methamphetamine and Conspiracy to Possess With the Intent to Distribute 50 Grams or More of Methamphetamine. HERNANDEZ was sentenced to 102 months’ imprisonment.
- BRIAN SHOLAR, 53, of Duplin County, NC, pled guilty to Conspiracy to Possess With Intent to Distribute 500 Grams or More of Methamphetamine and Possession With Intent to Distribute a Quantity of Methamphetamine. SHOLAR was sentenced to 120 months’ imprisonment.
- MARCUS SPANN, 19, of South Carolina, pled guilty to Conspiracy to Distribute and Possess With Intent to Distribute 28 Grams or More of Cocaine Base (Crack) and a Quantity of Heroin, Distribution and Possession With Intent to Distribute a Quantity of Heroin and Aiding and Abetting and Possession of a Firearm in Furtherance of a Drug Trafficking Crime. SPANN was sentenced to 48 months’ imprisonment.
- ERIC DUDLEY, 39, of Duplin County, NC, pled guilty to Conspiracy to Distribute and Possess With Intent to Distribute 50 Grams or More of Methamphetamine and Possession With Intent to Distribute and Distribute a Quantity of Methamphetamine. DUDLEY was sentenced to 220 months’ imprisonment.
- HECTOR MENOCAL-RUIZ, 28, of Duplin County, NC, pled guilty to Conspiracy to Distribute and Possess With the Intent to Distribute 5 Kilograms or More of Cocaine and Possession of a Firearm in Furtherance of a Drug Trafficking Crime. MENOCAL-RUIZ was sentenced to 180 months’ imprisonment.
- DAVID GIGUIERE, 61, of Duplin County, NC, pled guilty to Conspiracy to Distribute and Possess With the Intent to Distribute 50 Grams or More of Methamphetamine and Distribution of a Quantity of Methamphetamine and Aiding and Abetting. GIGUIERE was sentenced to 120 months’ imprisonment.
- JAVIER MERCADO, 41, of California, pled guilty to Conspiracy to Distribute and Possess With the Intent to Distribute 50 Grams or More of Methamphetamine. MERCADO was sentenced to 168 months’ imprisonment.
- JESUS RIOS, 39, of California, pled guilty to Conspiracy to Distribute and Possess With Intent to Distribute More Than 50 Grams of Methamphetamine. RIOS was sentenced to 120 months’ imprisonment.
- AARON ROBICHAUX, 37, of New Hanover County, NC, pled guilty to Conspiracy to Distribute and Possess With Intent to Distribute 500 Grams or More of Methamphetamine, Possession With Intent to Distribute a Quantity of Methamphetamine and a Quantity of Cocaine and Felon in Possession of a Firearm. ROBICHUAX was sentenced to 252 months’ imprisonment.
- JULIO NAJERA, 26, of Sampson County, NC, pled guilty to Conspiracy to Distribute and Possess With Intent to Distribute 50 Grams or More of Methamphetamine, Distribution of 50 Grams or More of Methamphetamine and Possession With Intent to Distribute 50 Grams or More of Methamphetamine. NAJERA was sentenced to 144 months’ imprisonment.
The remaining defendants are scheduled to be sentenced over the course of the next few months.
The Drug Enforcement Administration (DEA), Federal Bureau of Investigation (FBI), Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF), Duplin, New Hanover County and Sampson County Sheriffs’ Office, and the North Carolina State Bureau of Investigation conducted the investigation of this case. Assistant United States Attorneys Timothy Severo, Murphy Averitt and Bradford Knott prosecuted this case on behalf of the government. This OCDETF operation was nominated and received the Eastern District of North Carolina OCDETF Operation of the Year.
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.
One-day prison sentence vacated as result of U.S. Attorney’s Office appealRead the Press Release
DAYTON – Today the Sixth Circuit Court of Appeals filed an opinion vacating a one-day sentence that the U.S. Attorney’s Office appealed as unreasonably low in a child exploitation case.
Andrew Demma, 41, of Dayton, pleaded guilty in June 2017 to possessing child pornography involving pre-pubescent minors.
According to the Court of Appeal’s opinion, the FBI obtained and executed a search warrant in August 2015 at Demma’s residence and seized several electronic devices from the residence, finding more than 3,600 images and 230 videos of child pornography in Demma’s possession. Many of the images depicted adult men raping and otherwise sexually abusing pre-pubescent girls.
Demma was sentenced in October 2018 to one day in prison (under Bureau of Prison rules, the day on which Demma was processed by the Marshals following his arrest would have constituted the “one day” in prison).
At sentencing, psychologists testifying on behalf of the defense stated Demma’s use of child pornography stemmed from results of combat trauma during deployments with the United States military in Iraq. The Court of Appeals in its ruling specifically noted, however, “that there is no evidence in the record to support the proposition that military veterans suffering from PTSD typically become addicted to child pornography.”
Following sentencing, the government appealed, arguing that the effectively non-custodial sentence was unreasonably low.
The Sixth Circuit Court of Appeals took note of the size and nature of Demma’s child pornography collection and the fact he accessed child pornography on a daily basis by the use of complex software. The Sixth Circuit opinion also emphasized the serious and continuing harm inflicted upon victims of child pornography, and the need for sentences in this area to deter similar offenses.
Today’s opinion vacates Demma’s sentence, and the case has been sent back to the district court for re-sentencing. No re-sentencing date has been set as yet.
Appellate Chief Mary Beth Young argued the appeal on behalf of the United States. Demma’s criminal case was investigated by the FBI and prosecuted by Assistant Deputy Criminal Chief Laura I. Clemmens and Assistant United States Attorney Andrew J. Hunt.
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