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28 February 2020
Employee sentenced to federal prison for defrauding former employerRead the Press Release
Indianapolis – United States Attorney Josh J. Minkler announced today Sandra M. Urich, 54, Indianapolis, was sentenced in federal court for her role in a scheme to steal over $770,000 from her Indianapolis-based employer. Urich was sentenced to 27 months in federal prison by U.S. District Court Judge James R. Sweeney II.
“Businesses must be able to trust their employees,” said Minkler. “This case should serve as a reminder that those who steal from their employer by exploiting that trust, must be, and will be, held accountable.”
For almost 20 years, Urich was a trusted employee who handled order processing and payments for an Indianapolis business that manufactured and distributed products throughout the United States.
In 2011, Urich began secretly diverting customers’ credit card payments to her personal bank accounts. After receiving a customers’ credit card order, Urich would process “refunds” for certain orders. Instead of refunding the money to the customer’s credit card account, she entered her personal debit card numbers so the money was “refunded” to her personal bank accounts.
Urich’s scheme went undetected until the company uncovered her fraud in 2019. Over several years, Urich had taken multiple steps to cover her tracks. For instance, while she ensured that customers actually received the products they ordered, she also erased any reference to the customers’ orders she stole in the company’s shipping and accounting systems.
She would offer discounts to customers if they paid for shipping costs, to avoid the company incurring shipping costs for stolen orders that had been erased from the system.
To avoid detection, she stole relatively small amounts at a time, often just a few hundred dollars, and used specific dollar figures so as to not raise suspicions with the banks and credit card companies.
In over seven years, Urich diverted customer credit card payments nearly 1,000 times, and stole $771,927.04, which she spent largely on personal meals, clothing, and vacations.
This case was investigated by the Federal Bureau of Investigation and the Indianapolis Metropolitan Police Department.
“Ms. Urich abused her position of trust for one reason – simple greed. The fraud scheme she perpetrated not only jeopardized her employer’s business and reputation, but unsuspecting customers whose money she pocketed over the years,” said Special Agent in Charge, Grant Mendenhall, FBI Indianapolis. “This sentence sends a clear message that such illegal practices will not be tolerated. The FBI and our law enforcement partners will continue to aggressively pursue individuals who steal from honest, hardworking Americans.”
According to Assistant United States Attorney Nick Linder, who prosecuted the case for the government, Urich was sentenced to 27 months imprisonment, ordered to pay $771,927.04 in restitution, and serve 2 years of supervised release.
In October 2017, United States Attorney Josh J. Minkler announced a Strategic Plan designed to shape and strengthen the District’s response to its most significant public safety challenges. This prosecution demonstrates the Office’s firm commitment to prosecuting complex, long-running fraud schemes. See United States Attorney’s Office, Southern District of Indiana Strategic Plan Section 5.1.
El Departamento de Justicia Resuelve Denuncias Motivadas por Discriminación en la Vivienda Basada en una Discapacidad con Propietarios y Promotores Inmobiliarions de 11 Complejos de Apartamentos en Puerto RicoRead the Press Release
WASHINGTON, D.C. – El Departamento de Justicia anunció hoy que los propietarios y promotores inmobiliarios de 11 complejos de vivienda multifamiliares en Puerto Rico, cuyos edificios incluyen más de 650 unidades de alquiler, han acordado pagar un total combinado de $335.000 con el fin de resolver denuncias de que ellos habían vulnerado la ley de Vivienda Justa y la ley de Estadounidenses con Discapacidades al construir complejos de apartamentos que no eran accesibles para personas con discapacidades. Como parte del acuerdo, las compañías también acordaron realizar readaptaciones sustanciales para eliminar barreras a la accesibilidad.
Dos Órdenes de Consentimiento separadas, las cuales todavía necesitarían ser aprobadas por el Tribunal de Distrito de los EE. UU. para el Distrito de Puerto Rico, resuelven los pleitos que el Gobierno presentó ante el tribunal, junto con las Órdenes de Consentimiento contra los promotores inmobiliarios radicados en Puerto Rico, Fernando L. Sumaza & Co. Inc. y Star Management Corp. y sus empresas filiales. Conforme los términos de los acuerdos, los acusados deberán tomar medidas correctivas extensas para hacer que los complejos sean accesibles para personas con discapacidades. Estas medidas correctivas incluyen el reemplazo de porciones de la acera cuya inclinación es excesiva, la instalación de vías peatonales y rampas en las aceras con la inclinación apropiada para permitir a personas con discapacidades el acceso desde la acera y las zonas de estacionamiento a las viviendas, el reemplazo de los armarios en los baños y las cocinas para permitir suficiente espacio a personas en silla de ruedas y la eliminación de barreras a la accesibilidad en zonas públicas y de uso común en los complejos. Los acusados pagarán un total combinado de $325.000 para establecer dos fondos de indemnización para compensar a individuos con discapacidades que han sido afectados por las vulneraciones relacionadas con la accesibilidad. Por otra parte, se pagará una sanción civil de $10.000 a los Estados Unidos.
«La ley de Vivienda Justa y la ley de Estadounidenses con Discapacidades prohíben la discriminación por motivos de una discapacidad y garantizan los derechos de personas con una discapacidad a acceder a la vivienda de su elección», declaró Eric Dreiband, Fiscal General Auxiliar de la División de Derechos Civiles. «El Departamento de Justicia seguirá haciendo de manera agresiva que estas leyes se cumplan para asegurar que las viviendas residenciales multifamiliares se construyan con características accesibles».
«El acceso a una vivienda libre de discriminación es un derecho de todo estadounidense y es algo fundamental para el desarrollo de nuestras comunidades», afirmó el Fiscal Federal W. Stephen Muldrow del Distrito de Puerto Rico. «Este acuerdo es un ejemplo de los esfuerzos continuos de nuestra oficina por hacer cumplir las leyes antidiscriminatorias que protegen tales derechos».
Las Órdenes de Consentimiento también requieren que los acusados participen en una capacitación sobre la ley de Vivienda Justa y la ley de Estadounidenses con Discapacidades para garantizar que toda futura construcción de viviendas multifamiliares cumpla con estas leyes y para entregar informes periódicos al Departamento de Justicia.
Los 11 complejos en cuestión, todos de los que fueron construidos con el apoyo financiero del programa del gobierno federal de Crédito Fiscal para la Viviendas para Personas de Bajos Ingresos u otros programas federales, son:
Propiedades afiliadas a Fernando L. Sumaza & Co.
- La Inmaculada Elderly Center, San Juan, PR
- Marie Gardens, Cabo Rojo, PR
- San Cristobal, San Juan, PR
- San Fernando Elderly Center, Mayagüez, PR
- Virgen del Pozo, Sábana Grande, PR
Propiedades afiliadas a Star Management Corp.
- Florida Elderly Center, Florida, PR
- Isabela Elderly Center, Isabela, PR
- Monserrate Elderly Center, PR
- Morovis Elderly Center, PR
- Patillas Elderly Center, Patillas, PR
- Sunrise Elderly Center, San Juan, PR
Las personas que tengan derecho a recibir una parte de los fondos del acuerdo serán identificadas por medio de un proceso establecido en las Órdenes de Consentimiento. Aquellas personas que creen haber sufrido daños y perjuicios a causa de las condiciones inaccesibles de cualquiera de estas propiedades, ya sea cuando ellas o alguien asociado con ellas vivían allí o se planteaban vivir allí, deberían comunicarse con el Departamento de Justicia. Para propiedades afiliadas a Fernando L. Sumaza & Co., Inc. llame gratuitamente al 1-800-896-7743 buzón 6 o envíe un correo electrónico a [email protected]. Para propiedades afiliadas a Star Management, llame gratuitamente al 1-800-896-7743 buzón 9 o envíe un correo electrónico a [email protected].
La ley federal de Vivienda justa prohíbe la discriminación en la vivienda por motivos de discapacidad, raza, color de piel, religión, origen nacional, género, discapacidad o estado familiar. Entre otras cosas, la ley de Vivienda Justa requiere que toda vivienda multifamiliar construida después del 13 de marzo de 1991 disponga de las características básicas de accesibilidad, lo que incluye vías de acceso sin escaleras a todas las unidades de la planta baja y unidades accesibles a personas en silla de ruedas y a otras personas con discapacidades. Promulgada en el año 1990, la ley de Estadounidenses con Discapacidades requiere, entre otras cosas, que instalaciones públicas, tales como oficinas de alquiler en complejos de viviendas multifamiliares diseñados y construidos para una fecha de primera ocupación de los mismos posterior al 26 de enero de 1993, sean accesibles a personas con discapacidades.
La aplicación de la ley de Vivienda Justa es una prioridad de la División de Derechos Civiles. Para más información acerca de la División de Derechos Civiles y las leyes que hace cumplir, vaya a https://www.justice.gov/crt.
Eight Members of South Bay-Backed Drug Trafficking Organizations Charged in Federal IndictmentsRead the Press Release
SAN FRANCISCO – Eight defendants were indicted on narcotics trafficking charges, announced United States Attorney David L. Anderson, Drug Enforcement Administration (DEA) Special Agent in Charge Daniel C. Comeaux, and Homeland Security Investigations (HSI) Special Agent in Charge Tatum King. The defendants were arrested on November 6, 2019, and February 11, 2020, in the areas of San Jose and Tracy, Calif. In addition to the two indictments—one filed on November 14, 2019, and the other filed February 21, 2020—four criminal complaints have been filed in this investigation.
According to the complaints, DEA and HSI have been engaged in an investigation since early 2019 into two South Bay-based drug trafficking organizations. The federal agencies used several tools—including a confidential source to conduct controlled purchases of methamphetamine and court-ordered telephonic communications intercepts—to gather evidence regarding certain targets. For example, one of the complaints describes how on May 5, 2019, a confidential source sought to purchase from Eleazar Garcia, aka Jr, three pounds of methamphetamine. According to that complaint, Garcia obtained the drugs in Mountain View from co-defendant Misael Barajas and then exchanged the drugs in Gilroy with the confidential source for $5,100. Garcia then arranged to have proceeds from the sale of the drugs delivered to Barajas. Similarly, one of the complaints describes how in August of 2019 a confidential source called Garcia to purchase two ounces of cocaine. On this occasion, Garcia allegedly arranged to obtain the drugs from co-defendant Miguel Gallardo Pacheco. According to one of the complaints, the confidential source met with Garcia and Gallardo in a BMW parked in a pre-determined location in San Jose. The confidential source allegedly entered the car, took the cocaine from the middle console of the car and handed $2,200 to Garcia. Garcia counted the money and gave it to Gallardo.
The complaints describe additional transactions involving the possession, sale, and distribution of methamphetamine and cocaine in October and November of 2019. Further, one of the complaints describes the November 6, 2019, arrest of co-defendant Omar Fernando Peralta Sanchez at which time federal agents retrieved 10 pounds of crystal methamphetamine and five gallons of liquid methamphetamine from his residence. In sum, the indictments charge the defendants with the following crimes:
Defendant Age/Residence Charges Maximum PenaltiesMisael Barajas
(charged in the Nov. 14, 2019, and Feb. 20, 2020, indictments)
31/Sunnyvale, Calif.21 U.S.C. §§ 846, 841(a)(1), and (b)(1)(C) – Conspiracy to Distribute and Possess with Intent to Distribute Methamphetamine
Maximum 20 years imprisonment; maximum $1 million fine
21 U.S.C. § 841(a)(1) and (b)(1)(A)(viii) – Possession with Intent to Distribute and Distribution of 500 Grams and More of a Mixture Containing Methamphetamine [two counts] Not less than 10 years imprisonment and up to life; maximum $10 million fine 21 U.S.C. §§ 846, 841(a)(1), (b)(1)(A)(viii), and (b)(1)(C) – Conspiracy to Distribute and Possess with Intent to Distribute 500 Grams and More of a Mixture Containing Methamphetamine, and Cocaine Not less than 10 years imprisonment and up to life; maximum $10 million fineDavid Pecina Garcia
(charged in the Feb. 20, 2020, indictment) 39/San Jose, Calif.21 U.S.C. §§ 846, 841(a)(1), and (b)(1)(C) – Conspiracy to Distribute and Possess with Intent to Distribute Methamphetamine
Maximum 20 years imprisonment; maximum $1 million fine
21 U.S.C. § 841(a)(1) and (b)(1)(A)(viii) – Possession with Intent to Distribute and Distribution of 500 Grams and More of a Mixture Containing Methamphetamine Not less than 10 years imprisonment and up to life; maximum $10 million fineEleazar Garcia, aka Jr
(charged in the Feb. 20, 2020, indictment)
36/Tracy, Calif.21 U.S.C. §§ 846, 841(a)(1), and (b)(1)(C) – Conspiracy to Distribute and Possess with Intent to Distribute Methamphetamine
Maximum 20 years imprisonment; maximum $1 million fine
21 U.S.C. § 841(a)(1) and (b)(1)(A)(viii) – Possession with Intent to Distribute and Distribution of 500 Grams and More of a Mixture Containing Methamphetamine Not less than 10 years imprisonment and up to life; maximum $10 million fine 21 U.S.C. § 841(a)(1) and (b)(1)(C) – Possession with Intent to Distribute and Distribution of Cocaine Maximum 20 years imprisonment; maximum $1 million fineEleazar Garcia, aka Senior
(charged in the Feb. 20, 2020, indictment) 68/Modesto, Calif.21 U.S.C. §§ 846, 841(a)(1), and (b)(1)(C) – Conspiracy to Distribute and Possess with Intent to Distribute Methamphetamine
Maximum 20 years imprisonment; maximum $1 million fineJesus Garcia-Cano, aka Chuche
(charged in the Feb. 20, 2020, indictment) 25/San Jose, Calif.21 U.S.C. §§ 846, 841(a)(1), and (b)(1)(C) – Conspiracy to Distribute and Possess with Intent to Distribute Methamphetamine
Maximum 20 years imprisonment; maximum $1 million fine
21 U.S.C. § 841(a)(1) and (b)(1)(A)(viii) – Possession with Intent to Distribute and Distribution of 500 Grams and More of a Mixture Containing Methamphetamine Not less than 10 years imprisonment and up to life; maximum $10 million fineMiguel Gallardo Pacheco
(charged in the Feb. 20, 2020, indictment) 22/San Jose, Calif. 21 U.S.C. § 841(a)(1) and (b)(1)(C) – Possession with Intent to Distribute and Distribution of Cocaine Maximum 20 years imprisonment; maximum $1 million fineOctavio Paque
(charged in the Nov. 14, 2019, indictment) 35/San Jose, Calif. 21 U.S.C. §§ 846, 841(a)(1), (b)(1)(A)(viii), and (b)(1)(C) – Conspiracy to Distribute and Possess with Intent to Distribute 500 Grams and More of a Mixture Containing Methamphetamine, and Cocaine Not less than 10 years imprisonment and up to life; maximum $10 million fineOmar Fernado Peralta Sanchez
(charged in the Nov. 14, 2019, indictment) 36/San Jose, Calif.21 U.S.C. §§ 846, 841(a)(1), (b)(1)(A)(viii), and (b)(1)(C) – Conspiracy to Distribute and Possess with Intent to Distribute 500 Grams and More of a Mixture Containing Methamphetamine, and Cocaine
Not less than 10 years imprisonment and up to life; maximum $10 million fine
21 U.S.C. § 841(a)(1) and (b)(1)(A)(viii) – Possession with Intent to Distribute and Distribution of 500 Grams and More of a Mixture Containing Methamphetamine Maximum 20 years imprisonment; maximum $1 million fineThe indictments and complaints merely allege that crimes have been committed, and each defendant must be presumed innocent until proven guilty beyond a reasonable doubt. If convicted, the defendants face maximum sentences and fines described in the table above. However, any sentence following conviction would be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant U.S. Attorney Sarah Griswold is prosecuting these cases with the assistance of Laurie Worthen and Jessica Leung. These cases were investigated and prosecuted by member agencies of 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.
Dominican National Illegally in the United States Sentenced to More Than Five Years in Federal Prison for Selling Heroin in Cecil County, MarylandRead the Press Release
Baltimore, Maryland – U.S. District Judge Richard D. Bennett today sentenced Ivanovich Constanzo Mercedes-Soriano, a/k/a German Pena-Lopez, age 31, of Aberdeen, Maryland, to 63 months in federal prison, followed by one year of supervised release, for conspiring to distribute heroin and cocaine and for making a false claim to U.S. citizenship.
The sentence was announced by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge John Eisert of Homeland Security Investigations (HSI) Baltimore; and Colonel Woodrow W. Jones III, Acting Superintendent of the Maryland State Police (MSP).
According to his plea agreement, Mercedes-Soriano was born in the Dominican Republic and is illegally in the United States. At least as early as June 2017 and continuing until September 26, 2018, Mercedes-Soriano conspired with Elvin Solano-Pena, a/k/a Joseph Allen Fields, and Herme Soriano, a/k/a Miguel Urraca-Gonzalez, and others to distribute crack cocaine and 1000 grams or more of heroin to drug users that lived primarily in Cecil County, Maryland.
In July 16, 2018, Maryland State Police (MSP) developed information that drug users were using a designated phone number, referred to as the “dispatch phone,” to purchase drugs. On July 23, 2018, a drug user called the dispatch phone and spoke to a man who told the customer to meet him at a grocery store in Elkton. Mercedes-Soriano arrived in a black Honda Civic and sold the customer one gram of heroin and .4 grams of crack cocaine.
On August 3, 2018, the same drug user called the dispatch phone and spoke to Solano-Pena. After the call, Soriano arrived at the agreed meeting place and sold the customer .6 gram of heroin and .6 gram of crack cocaine. MSP stopped the vehicle; Soriano was driving, and MSP identified him as the man who sold the drugs. After searching the car, MSP recovered another .4 gram of heroin and $648 in cash, as well as a crack pipe and burnt cocaine. Soriano provided a false name at the time. MSP used social media to attempt to identify him and found pictures of Soriano with Mercedes-Soriano. The two men were later identified as brothers.
Mercedes-Soriano and Soriano were illegal aliens using fraudulently obtained driver’s licenses in their respective alias names. On September 6, 2018, both men were taken into custody by Immigration and Customs Enforcement (ICE) following a traffic stop of the black Honda Civic they were driving. Both men produced fraudulent documents and lied as to their identity, citizenship, and travel to the United States. Both Mercedes-Soriano and Soriano were interviewed by ICE officers after being advised of their rights in Spanish and falsely swore that they were U.S. citizens, born in Puerto Rico. In fact, both men are citizens of the Dominican Republic.
A towing company retrieved the black Honda Civic and stored it in Cecil County. The car was registered in the name of co-defendant Oscar Pilarte-Rivera, a close friend of Mercedes-Soriano, Solano-Pena, and Soriano. Pilarte-Rivera provided assistance to the drug dealers, among other things, by allowing them to use a car registered in his name, knowing the men were involved in drug trafficking. Pilarte claimed possession of the black Honda from police custody.
On September 25, 2018, Mercedes-Soriano called Pilarte-Rivera from jail. The call was in Spanish but Mercedes-Soriano indicated he had tried to call Pilarte-Rivera three times but that he had not answered the phone. The men discussed items in Mercedes-Soriano’s apartment that needed to be picked up. As a result, HSI obtained a federal search warrant for Mercedes-Soriano’s apartment on Stevens Circle in Aberdeen, Maryland and executed it on September 26, 2018. In addition to identity documents for Mercedes-Soriano and other records, law enforcement recovered drugs packaged for distribution. After laboratory testing, it was determined the drugs seized included approximately 160 grams of heroin, 222 grams of heroin and fentanyl, and approximately 32 grams of crack cocaine. The packaging tested positive for Mercedes-Soriano’s DNA.
In his plea agreement, Mercedes-Soriano admitted he sold between one and three kilograms of heroin. Mercedes-Soriano’s phone records reflect the frequency of calls with drug customers and corroborated their individual testimony about drug sales.
As part of his plea agreement and sentence, Mercedes-Soriano will be deported to the Dominican Republic upon his release from prison.
Pilarte-Rivara, Solano-Pena, and Soriano previously pleaded guilty to federal charges for their respective roles in the drug conspiracy and received sentences ranging from time served to four years in federal prison.
United States Attorney Robert K. Hur commended the HSI Baltimore and the Maryland State Police for their work in the investigation and thanked U.S. Immigration and Customs Enforcement’s Enforcement Removal Operations for its assistance. Mr. Hur thanked Assistant U.S. Attorneys Sandra Wilkinson and Paul Riley, who prosecuted the case.
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Diversicare Health Services, Inc. Agrees to Pay $9.5 Million to Resolve False Claims Act AllegationsRead the Press Release
NASHVILLE, Tenn. – February 28, 2020 - Diversicare Health Services, Inc., has agreed to pay $9.5 million to resolve allegations that it violated the False Claims Act by knowingly submitting false claims to Medicare for rehabilitation therapy services that were not reasonable, necessary, or skilled, the Department of Justice announced today. The settlement also resolves allegations that Diversicare submitted forged pre-admission evaluations of patient need for skilled nursing services to TennCare, the state of Tennessee’s Medicaid Program. Diversicare, based in Brentwood, Tennessee, provides skilled nursing and rehabilitation services at approximately 74 facilities across the country.
“Families expect that their loved ones will receive the necessary care to improve their health and quality of life when they entrust them to a facility for care,” said U.S. Attorney Don Cochran. “Companies who engage in a practice of cheating and exploiting public healthcare programs, while subjecting patients to unreasonable and unnecessary treatments in order to increase their profits, will pay a substantial penalty.”
“Today’s settlement demonstrates our commitment to protect patients by ensuring that the care provided to Medicare and Medicaid beneficiaries is dictated by their clinical needs and not by their providers’ financial interests,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division. “Nursing home facilities must be held to account when they provide patients with unnecessary services that may adversely impact their well-being and waste taxpayer dollars.”
The government alleged that from January 1, 2010 through December 31, 2015, Diversicare’s corporate policies and practices were designed to place as many beneficiaries in the highest level of Medicare reimbursement—Ultra High—irrespective of the individual clinical needs of the patients. These profit-driven policies and practices resulted in the provision of unreasonable, unnecessary, and unskilled therapy to many beneficiaries in Diversicare’s skilled nursing facilities. The government alleged that Diversicare submitted claims for Ultra High therapy levels despite evidence that (1) the frequency and duration of physical or occupational therapy were not reasonable or necessary for the patient, (2) the intensity of the physical or occupational therapy was inappropriate for the patient and not reasonable or necessary, (3) services did not require the skills of a therapist to perform them, and (4) speech therapy was medically unnecessary. This included specific instances of improper co-treatment in order to achieve minute thresholds, repetitive and unskilled exercises that did not match plan of care goals to obtain additional minutes, engaging patients in activities contraindicated by underlying medical conditions, inflating Activities of Daily Living (ADL) scores and extending patient lengths of stay beyond what was medically indicated, billing for services that were not provided, using budgets, goals, and quotas to ensure Ultra High therapy was maximized, and threatening or undertaking adverse actions against employees if they failed to meet the budgets, goals, or quotas.
The government also alleged that Diversicare submitted forged, photocopied, or pre-signed physician signatures on pre-admission evaluation certifications required in the submission of claims to TennCare for nursing facility services rendered to TennCare beneficiaries at its associated Tennessee skilled nursing and rehabilitation facilities. TennCare is Tennessee’s Medicaid program jointly funded by the state of Tennessee and the federal government.
As part of the settlement, Diversicare entered into a five-year Corporate Integrity Agreement (CIA) with the HHS-OIG requiring, among other things, the implementation of a risk assessment and internal review process designed to identify and address evolving compliance risks. The CIA requires training, auditing, and monitoring designed to address the conduct at issue in the case.
“This settlement sends a strong message to nursing home chains that provide medically unnecessary therapy services, as alleged in this case,” said Derrick L. Jackson, Special Agent in Charge at the U.S. Department of Health and Human Services, Office of Inspector General in Atlanta. “We will aggressively investigate providers who waste taxpayer dollars and work to recover any money that has been overpaid.”
“We’re committed to playing a part in protecting the tax dollars used to support our most vulnerable residents,” said TBI Director David Rausch. “When companies take advantage of the Medicaid system, we all lose. We’re gratified by this settlement and hope it sends another strong message that, together, we will continue to pursue and prosecute those who profit in illegal ways.”
The settlement resolves allegations originally brought in lawsuits filed under the qui tam, or whistleblower, provisions of the False Claims Act by former Diversicare employees. The act permits private parties to sue on behalf of the government for false claims for government funds and to receive a share of any recovery. The whistleblower reward in this case will be approximately $1.5 million.
The settlement was the result of a coordinated effort by the United States Attorney’s Office for the Middle District of Tennessee and the Civil Division of the Department of Justice; the Office of Inspector General of the Department of Health and Human Services;, the Tennessee Attorney General’s Office; and the Tennessee Bureau of Investigation. The United States is represented by Assistant U.S. Attorney Sarah K. Bogni and Trial Attorney Yolanda Campbell.
The two qui tam cases are captioned as United States ex rel. Haggard v. Diversicare Mgmt. Services, Co. et al., 3:12-cv-00669 (M.D. Tenn) and United States ex rel. Fitzmorris v. Diversicare Health Services, Inc., No. 3:16-cv-03037 (M.D. Tenn). The claims resolved by the settlement are allegations only; there has been no determination of liability.
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Diversicare Health Services Inc. Agrees to Pay $9.5 Million to Resolve False Claims Act Allegations Relating to the Provision of Medically Unnecessary Rehabilitation Therapy ServicesRead the Press Release
Diversicare Health Services Inc., has agreed to pay $9.5 million to resolve allegations that it violated the False Claims Act by knowingly submitting false claims to Medicare for rehabilitation therapy services that were not reasonable, necessary, or skilled, the Department of Justice announced today.
The settlement also resolves allegations that Diversicare submitted forged pre-admission evaluations of patient need for skilled nursing services to TennCare, the state of Tennessee’s Medicaid Program. Diversicare, based in Brentwood, Tennessee, provides skilled nursing and rehabilitation services at approximately 74 facilities across the country.
“Today’s settlement demonstrates our commitment to protect patients and taxpayers by ensuring that the care provided to Medicare and Medicaid beneficiaries is dictated by their clinical needs and not by their providers’ financial interests,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division. “Nursing home facilities provide important services to our vulnerable elderly population, and those facilities must be held to account when they provide patients with unnecessary services that may adversely impact their well-being and waste taxpayer dollars.”
“Families expect that their loved ones will receive the necessary care to improve their health and quality of life when they entrust them to a facility for care,” said U.S. Attorney Don Cochran for the Middle District of Tennessee. “Companies who engage in a practice of cheating and exploiting public healthcare programs, while subjecting patients to unreasonable and unnecessary treatments in order to increase their profits, will pay a substantial penalty.”
The government alleged that from Jan. 1, 2010, through Dec. 31, 2015, Diversicare’s corporate policies and practices were designed to place as many beneficiaries in the highest level of Medicare reimbursement — Ultra High — irrespective of the individual clinical needs of the patients. These profit-driven policies and practices resulted in the provision of unreasonable, unnecessary, and unskilled therapy to many beneficiaries in Diversicare’s skilled nursing facilities. The government alleged that Diversicare submitted claims for Ultra High therapy levels despite evidence that (1) the frequency and duration of physical or occupational therapy were not reasonable or necessary for the patient, (2) the intensity of the physical or occupational therapy was inappropriate for the patient and not reasonable or necessary, (3) services did not require the skills of a therapist to perform them, and (4) speech therapy was medically unnecessary. This included specific instances of improper co-treatment in order to achieve minute thresholds, repetitive and unskilled exercises that did not match plan of care goals to obtain additional minutes, engaging patients in activities contraindicated by underlying medical conditions, inflating ADL scores, extending patient lengths of stay beyond what was medically indicated, billing for services that were not provided, using budgets, goals, and quotas to ensure Ultra High therapy was maximized, and threatening or undertaking adverse actions against employees if they failed to meet the budgets, goals, or quotas.
The government also alleged that Diversicare submitted forged, photocopied, or pre-signed physician signatures on pre-admission evaluation certifications required in the submission of claims to TennCare for nursing facility services rendered to TennCare beneficiaries at its associated Tennessee skilled nursing and rehabilitation facilities. TennCare is Tennessee’s Medicaid program jointly funded by the state of Tennessee and the federal government.
As part of the settlement, Diversicare entered into a five-year Corporate Integrity Agreement (CIA) with the HHS-OIG requiring, among other things, the implementation of a risk assessment and internal review process designed to identify and address evolving compliance risks. The CIA requires training, auditing, and monitoring designed to address the conduct at issue in the case.
“This settlement sends a strong message to nursing home chains that provide medically unnecessary therapy services, as alleged in this case,” said Derrick L. Jackson, Special Agent in Charge at the U.S. Department of Health and Human Services, Office of Inspector General in Atlanta. “We will aggressively investigate providers who waste taxpayer dollars and work to recover any money that has been overpaid.”
“We’re committed to playing a part in protecting the tax dollars used to support our most vulnerable residents,” said Tennessee Bureau of Investigation Director David Rausch. “When companies take advantage of the Medicaid system, we all lose. We’re gratified by this settlement and hope it sends another strong message that, together, we will continue to pursue and prosecute those who profit in illegal ways.”
The settlement, which was based on the company’s ability to pay, resolves allegations originally brought in lawsuits filed under the qui tam, or whistleblower, provisions of the False Claims Act by Mary Haggard and Bryant Fitzmorris, former Diversicare employees. The act permits private parties to sue on behalf of the government for false claims for government funds and to receive a share of any recovery. Ms. Haggard will receive approximately $1.4 million and Mr. Fitzmorris will receive approximately $145,350.
The settlement was the result of a coordinated effort by the Civil Division of the Department of Justice, the U.S. Attorney’s Office for the Middle District of Tennessee, the Office of Inspector General of the Department of Health and Human Services, and the Tennessee Bureau of Investigation.
The two qui tam cases are captioned United States ex rel. Haggard v. Diversicare Mgmt. Services, Co. et al., 3:12-cv-00669 (M.D. Tenn) and United States ex rel. Fitzmorris v. Diversicare Health Services, Inc., No. 3:16-cv-03037 (M.D. Tenn). The claims resolved by the settlement are allegations only; there has been no determination of liability.
The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
District Man Sentenced to 15 Years in Prison for the Murder of 79-Year-Old ManRead the Press Release
WASHINGTON – Malcolm Cunningham, 24, of Washington, D.C. was sentenced today by Judge Ronna Beck to 18 years’ incarceration, suspending all but 15 years of incarceration for the murder of his great grandmother’s common-law-husband, David Norwood, U.S. Attorney Timothy J. Shea announced. Cunningham previously pled guilty to one count of second degree murder while armed with a sentencing range of 12 to 18 years in prison.
The incident occurred on Easter Sunday 2017. Prior to the murder, Mr. Norwood and his wife (Cunningham’s great-grandmother) had allowed Cunningham to stay in their home for about a year. Two weeks before the murder, Mr. Norwood and Cunningham’s great grandmother finally kicked Cunningham out of the residence as a result of fights he was repeatedly having with other residents. On Easter morning, Cunningham snuck back into the residence where he found Mr. Norwood, alone. Cunningham argued with Mr. Norwood and then took a knife from the kitchen and stabbed him before fleeing the scene. Mr. Norwood remained in the home, injured, until family members found him hours later, unconscious and lying on the floor. A short time later Mr. Norwood died as a result of his injuries.
In announcing the sentence, U.S. Attorney Shea commended the work of those who investigated the case from the Criminal Investigations Division Homicide Branch of the Metropolitan Police Department. He acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialists Lornce Applewhite and Alesha Matthews-Yette and Victim Witness Specialist Marcia Rinker. Finally, U.S. Attorney Shea commended the work of Assistant U.S. Attorney Michael Liebman who prosecuted the case.
District Man Found Guilty of Nationwide PCP Trafficking Conspiracy and Firearms ChargesRead the Press Release
WASHINGTON – Lamont Alvester Johnson, 43, of Washington, D.C., has been found guilty after a jury trial of conspiring to traffic in large quantities of Phencyclidine (PCP), possessing with the intent to distribute large quantities of PCP, possessing a firearm after having previously been convicted of a felony, and possessing a firearm in furtherance of a drug trafficking offense, announced U.S. Attorney Timothy J. Shea, FBI Assistant Director Timothy Slater, ATF Special Agent in Charge Ashan Benedict, Metropolitan Police Department Chief Peter Newsham, U.S. Park Police Chief Gregory Monahan, United States Chief Marshal Lamont Ruffin, and Prince George’s County Police Chief Henry Stawinski.
Johnson was found guilty on February 27, 2020, following a trial in the United States District Court for the District of Columbia before the Honorable Thomas F. Hogan. Sentencing is scheduled for June 11, 2020. Johnson faces a mandatory sentence of life imprisonment in light of his extensive criminal record, including prior convictions for crimes of violence while armed and drug trafficking.
According to the government’s evidence, which included court-authorized wiretaps, search warrants, GPS trackers, and undercover purchases of narcotics, Johnson was the main supplier of PCP to a drug trafficking ring that was indicted in an eight-co-defendant, 55-count indictment. Johnson was supplied gallon-quantities of PCP from West Coast suppliers, and he redistributed the PCP to other wholesale-level PCP suppliers in the District of Columbia. The evidence established that Johnson used threats and intimidation in his PCP trafficking operation, including with an AR-15 assault rifle that was seized from him along with over a kilogram of PCP and related drug trafficking paraphernalia. During the investigation, federal law enforcement officers seized approximately 2.5 kilograms of PCP; ¼ kilogram of heroin; ½ kilogram of cocaine; 50 grams of crack cocaine base; assorted drug trafficking paraphernalia; and firearms, including Johnson’s AR-15 assault rifle, laser scopes, ammunition, and high-capacity magazines.
In announcing the verdicts, U.S. Attorney Shea, FBI Assistant Director Timothy Slater, ATF Special Agent in Charge Ashan Benedict, U.S. Park Police Chief Gregory Monahan, United States Chief Marshal Lamont Ruffin, Chief Peter Newsham of the Metropolitan Police Department, and Prince George’s County Police Chief Henry Stawinski commended the work of the many dedicated people who worked tireless hours on the case, including Special Agents from the FBI’s Washington Field Office and the ATF’s Washington Field Division, Deputy U.S. Marshals, and officers with the Metropolitan Police Department and the U.S. Park Police. They also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office for the District of Columbia, including Assistant U.S. Attorney George Eliopoulos and Assistant U.S. Attorney Nihar Mohanty, who prosecuted the case, as well as Paralegals Rommel Pachoca and Katie Thomas and Legal Assistants Emma Atlas and Kate Abrey.
Clermont Man Sentenced to Federal Prison for Downloading Child PornographyRead the Press Release
Tampa, Florida – U.S. District Judge William F. Jung today sentenced Sean Ferraresi (34, Clermont) to 10 years and 1 month in federal prison for receipt of child pornography. The court also ordered Ferraresi to forfeit the computers he had used to download and store child pornography.
Ferraresi had pleaded guilty on December 13, 2019.
According to court documents, Ferraresi had downloaded thousands of files depicting the sexual abuse of children. In addition, after Ferraresi was arrested, law enforcement officers discovered sexually explicit text messages between Ferraresi and children, including conversations in which Ferraresi solicited nude images from or sent nude images to children.
This case was investigated by the Federal Bureau of Investigation. It was prosecuted by Assistant United States Attorney Colin P. McDonell.
It is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Chicago Drug Dealer Sentenced to Life in Prison for Distribution of Heroin Resulting in DeathRead the Press Release
United States Attorney Ron Parsons announced that a Chicago, Illinois, man was sentenced to life in prison by U.S. District Judge Karen E. Schreier.
Maurice Bellafonta Cathey, a/k/a “Short,” age 39, was convicted of two counts of Conspiracy to Distribute a Controlled Substance, one count of Distribution of a Controlled Substance Resulting in Death, and two counts of Distribution of a Controlled Substance Resulting in Serious Bodily Injury in a November 2019 trial.
On February 24, 2020, U.S. District Court Judge Karen E. Schreier sentenced Cathey to 30 years in federal prison on each conspiracy count and life in prison for the death and serious bodily injury counts, all to run concurrently. Cathey was also ordered to pay $500 to the Federal Crime Victims Fund.
On January 5, 2018, first responders reported to a fatal overdose of a 22-year-old man at an apartment in Sioux Falls, South Dakota. The victim was unresponsive and attempts to revive him were unsuccessful. A friend of the victim who was with him said that the victim had injected himself with heroin. The victim obtained heroin from his friend that had been distributed by Cathey. Minnehaha County Coroner Dr. Kenneth Snell ruled that the victim’s cause of death was heroin and cyclopropyl fentanyl toxicity.
On February 9, 2018, first responders were dispatched to a fast food restaurant on South Minnesota Avenue for a report of cardiac arrest, where they found a 20-year-old woman who was unconscious and not breathing due to a heroin overdose. The victim was revived by first responders with Narcan. Cathey sold the heroin to the victim minutes before her overdose.
On April 23, 2018, first responders were dispatched to an overdose call at an apartment in Sioux Falls. First responders encountered a 24-year-old man who had overdosed on heroin laced with tramadol, 4-ANPP, and fentanyl, ultimately distributed by Cathey and his co-conspirator, Corrod Phillips. The victim was unconscious and not breathing when first responders arrived, but was revived by Narcan.
On May 16, 2018, a 23-year-old man overdosed on heroin in the bathroom of a grocery store in Sioux Falls. First responders found him unconscious and breathing poorly, and were able to awaken him with Narcan. The victim said he purchased the heroin from Phillips less than an hour before his overdose.
Testimony at trial revealed that multiple other overdoses, including at least one additional death, were caused by heroin distributed by Cathey and Phillips.
The Sioux Falls Area Drug Task Force executed multiple search warrants during the investigation at residences connected to Cathey and Phillips. During the execution of these warrants, SFADTF members located dozens of bindles of crack cocaine and heroin, thousands of dollars in U.S. Currency, and numerous items of drug distribution paraphernalia.
“The sentencing of this career felon to life in prison brings a fitting end to one of the saddest chapters in the history of Sioux Falls,” said U.S. Attorney Parsons. “But the story of how our community came together to defeat the opioid crisis is not yet finished, and we all have much more work to do.”
This case was investigated by the Drug Enforcement Administration, the Sioux Falls Area Drug Task Force, the Sioux Falls Police Department, and the U.S. Postal Inspection Service. Assistant U.S. Attorney Jennifer D. Mammenga prosecuted the case.
Cathey was immediately turned over to the custody of the U.S. Marshals Service. Corrod Phillips awaits sentencing.
Cary Man Sentenced to More Than 5 Years Imprisonment on Child Pornography ChargesRead the Press Release
RALEIGH — The United States Attorney for the Eastern District of North Carolina, Robert J. Higdon, Jr., announced that yesterday, Chief United States District Judge Terrence W. Boyle, sentenced CHRISTOPHER THOMAS WARD, 37, of Cary, NC to 70 months imprisonment, followed by a ten year term of supervised release. WARD pled guilty pursuant to a plea agreement on September 25, 2019 to one count of receipt of child pornography.
A 2017 investigation into a file sharing network identified WARD’s IP address as advertising known child pornography files, which were directly downloaded from WARD’s IP address on multiple dates. Law enforcement identified WARD’s residence, and a search warrant was obtained. Investigators executed the search warrant on December 15, 2017 and seized numerous electronic devices.
WARD agreed to speak with investigators and, during the interview, admitted to searching for, downloading and storing child pornography. A forensic review of the seized devices determined that WARD had amassed hundreds of thousands of files containing child pornography images and videos.
This case is part of the Project Safe Childhood initiative, a national program aimed at ensuring that criminals exploiting children are effectively prosecuted by making full use of all available law enforcement resources at every level. For more information about this important national initiative, go to www.projectsafechildhood.gov.
The Cary Police Department (CPD), Cary, North Carolina, and Homeland Security Investigations (HSI) conducted the investigation of this case. Assistant United States Attorney Bryan M. Stephany represented the government.
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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.
Bunch Man Sentenced to 80 Months for Drug ConspiracyRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Robbie Lee Holmes, age 31, of Bunch, Oklahoma, was sentenced to 80 months’ imprisonment, and 5 years of supervised release for Drug Conspiracy, in violation of Title 21, United States Code, Section 846. The charges arose from an investigation by the Tahlequah Police Department, the Cherokee County Sheriff’s Office, the Sequoyah County Sheriff’s Office, and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
The Superseding Indictment alleged that beginning in or about September 2017, and continuing up to and including the date of the Superseding Indictment, within the Eastern District of Oklahoma and elsewhere, the Defendant knowingly and intentionally conspired and agreed with others to possess with intent to distribute and distribute methamphetamine, a Schedule II controlled substance.
United States Attorney Brian J. Kuester said, “Hundreds of people die every year in Oklahoma as a result of methamphetamine. That is why local, state, tribal and federal law enforcement agencies continue to diligently pursue drug trafficking organizations responsible for delivery and distribution of this deadly drug in Oklahoma and throughout the country. Because of successful multi-agency investigations like this one, we continue to identify the distribution networks and organizations that deliver the drugs and the tragic outcomes that follow.”
”The availability of illegal drugs and guns lends to increased violent crime in our communities,” stated ATF Special Agent in Charge Jeffrey C. Boshek II. “ATF is committed to disrupting that cycle through collaborative investigations like this.”
The Honorable Ronald A. White, U.S. District Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, presided over the hearing. Assistant United States Attorney Shannon Henson represented the United States.Buffalo Woman Pleads Guilty for Her Role in Drug ConspiracyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Catherine Ramos, 31, of Buffalo, NY, pleaded guilty before U.S. District Judge Richard J. Arcara to conspiring to possess with intent to distribute cocaine. The charge carries a maximum possible sentence of 20 years imprisonment and a fine of $1,000,000.
Assistant U.S. Attorney Misha A. Coulson, who is handling the case, stated that beginning in May, 2017 through October, 2017, the defendant conspired with others to possess with intent to distribute cocaine. Specifically, Ramos also sold cocaine to an undercover police officer.
The plea is the result of an investigation by the Drug Enforcement Administration, under the direction of Special Agent-in-Charge Ray Donovan.
Sentencing is scheduled for June 5, 2020, at 12:30 p.m. before Judge Arcara.
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Buffalo Man Sentenced for Distribution of CocaineRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, NY - U.S. Attorney James P. Kennedy, Jr. announced today that Daniel Paul, 65, of Buffalo, New York, who was convicted of distribution of crack cocaine, was sentenced to serve 120 months in prison and 6 years of supervised release by United States District Court Judge Richard J. Arcara.
Assistant U.S. Attorney Meghan Tokash, who prosecuted the case, stated that in May of 2017, Paul sold 3.32 grams of crack cocaine to an undercover police officer at a location on Thatcher Street in the city of Buffalo. A life-long drug dealer and career criminal offender under the United States Sentencing Guidelines, Paul’s sentence is in part a reflection of his two prior felony convictions in Erie County court from 2004 for Attempted Criminal Sale of a Controlled Substance 3rd and in 2010 for Attempted Criminal Sale of a Controlled Substance 4th. When announcing Paul’s sentence, Judge Arcara noted the defendant’s age and declining health, however stressed the need to protect the public from those who deal drugs.
The sentencing is the result of an investigation by the Drug Enforcement Administration, under the direction of Special Agent-in-Charge Ray Donovan, New York Field Division, the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Gary Loeffert, and the New York State Police, under the direction of Major Edward Kennedy.
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Brooklyn Center Felon Sentenced to 10 Years in Prison for Illegal Possession of Multiple Firearms and DrugsRead the Press Release
United States Attorney Erica H. MacDonald today announced the sentencing of HURIAH KAREEM BLEDSOE, 40, to 120 months in prison for illegally possessing five firearms and quantities of marijuana, methamphetamine, cocaine, and heroin. BLEDSOE, who pleaded guilty on October 15, 2019, was sentenced today before Judge Susan Richard Nelson in U.S. District Court in St. Paul, Minnesota.
United States Attorney Erica H. MacDonald said, “Mr. Bledsoe, a convicted felon with an extremely violent criminal history, was in possession of multiple firearms, hundreds of rounds of ammunition, and a variety of dangerous drugs – all in the presence of young children. His actions showed no regard for the safety of those children or the broader community.”
According to the defendant’s guilty plea and documents filed in court, on January 2, 2019, and January 6, 2019, law enforcement received complaints from two separate callers stating that BLEDSOE was staying at the Extended Stay Hotel in Brooklyn Center, Minnesota, and he had guns in the hotel room. The callers also stated that there were minors in the hotel room.
According to the defendant’s guilty plea and documents filed in court, law enforcement obtained search warrants for BLEDSOE’s hotel room and on January 17, 2019, law enforcement executed the warrants and seized five firearms, namely, a North American Arms, model NAA-.22LR, .22LR caliber revolver, a Stoeger, model M3500, 12-gauge short-barreled shotgun, a Ruger, model SR40, .40 caliber semi-automatic handgun, an Imperial Metal Products, model 8, .22 caliber revolver, and a Ceska Zbrojsvka, model 50, 7.65 caliber semi-automatic handgun. Law enforcement also seized hundreds of rounds of ammunition, several high-capacity gun magazines, body armor, a digital scale, $2,320 in cash, and quantities of marijuana, methamphetamine, cocaine, and heroin.
This case is the result of an investigation conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Brooklyn Center Police Department. This case was brought as part of Project Safe Neighborhoods (PSN), an initiative that brings together federal, state, and local law enforcement to combat 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.
Assistant United States Attorneys Emily A. Polachek and Thomas M. Hollenhorst prosecuted the case.
Defendant Information:
HURIAH KAREEM BLEDSOE, 40
Brooklyn Center, Minn.
Convicted:
- Possession with the intent to distribute controlled substances, 1 count
- Felon in possession of firearms, 1 count
Sentenced:
- 120 months in prison
- Three years of supervised release
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Bloomsburg Man Charged with Impeding A Federal OfficerRead the Press Release
WILLIAMSPORT - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Scott Hemingway, age 63, of Bloomsburg, Pennsylvania, was indicted on February 27, 2020, by a federal grand jury on one charge of impeding a federal officer.
According to United States Attorney David J. Freed, the indictment alleges that on March 29, 2018, in Columbia County, Hemingway did strike and cause physical contact with a mail carrier.
The case was investigated by the United States Postal Inspection Service. Assistant U.S. Attorney Alisan V. Martin is prosecuting the case.
Indictments are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law for each offense is 8 years of imprisonment, a $250,000 fine, and a 3 year term of supervised release. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Biotech Officer Sentenced for Securities Fraud and Obstruction of SEC ProceedingRead the Press Release
BOSTON – The former Vice President of Investor Relations for PixarBio Corp., a Boston-based biotech company, was sentenced yesterday on securities fraud charges in connection with a scheme to manipulate trading in the company’s shares and obstruction of proceedings before the Securities and Exchange Commission (SEC).
Kenneth Stromsland, 48, of Rumson, N.J., was sentenced by U.S. Senior District Court Judge Douglas P. Woodlock to six months in home detention, three years of supervised release during which time he must complete 200 hours of community service per year, and ordered to pay a fine of $60,000 and forfeiture of $25,700. In September 2018, Stromsland pleaded guilty to one count of securities fraud through manipulative trading, one count of obstructing an agency proceeding and agreed to cooperate with the government. In April 2018, Stromsland was charged with co-defendant Frank Reynolds, the former chief executive officer of PixarBio. Reynolds was convicted by a federal jury in October 2019, and sentenced on Feb. 18, 2020, to seven years in prison.
Stromsland admitted that beginning in or about November 2016, he engaged in manipulative trades in PixarBio stock that simulated market interest in the stock and artificially pushed up the trading price. These trades included orders to buy at a price much higher than the price of the preceding market transaction.
Stromsland also admitted that during a 2017 SEC investigation into manipulative trading in PixarBio’s stock, he testified falsely before the SEC. In his testimony on three different days, Stromsland falsely denied that he had purchased shares of PixarBio to affect the share price and falsely denied that he had been instructed to do so by PixarBio’s then Chief Executive Officer.
United States Attorney Andrew E. Lelling; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and Carl W. Hoecker, Inspector General of the U.S. Securities and Exchange Commission Office of Inspector General, made the announcement. Assistant U.S. Attorneys Sara Miron Bloom and Leslie A. Wright of Lelling’s Securities and Financial Fraud Unit prosecuted the case.
Auburn Man Convicted of Possessing Firearm after Domestic Violence ConvictionRead the Press Release
Portland, Maine: An Auburn man was convicted yesterday following a two-day jury trial of possessing a firearm after being convicted of a misdemeanor crime of domestic violence, U.S. Attorney Halsey B. Frank announced.
According to court records and evidence presented at trial, in June 2010, Willie Richard Minor, 59, was convicted of Assault in Maine Superior Court. The victim of the assault was his wife at the time. As a result of that conviction, Minor was prohibited from possessing firearms. In November 2016, Minor admitted to having a gun in an interview with the Auburn Police Department. The police subsequently recovered the gun he had described.
Minor was originally convicted and sentenced on the federal charge after a trial in December 2017. While the case was pending on appeal, the Supreme Court of the United States issued a decision, Rehaif v. United States, that changed what the government is required to prove in certain federal firearm possession cases. As a result, the parties agreed to have the original conviction vacated, and the case was remanded for a new trial. At the second trial, the government was required to prove not only that Minor had been convicted of assaulting his wife, but also that he knew he had been so convicted and was aware of certain details of the conviction.
Minor faces up to 10 years in prison and a $250,000 fine. He will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
The Auburn Police Department, the Mechanic Falls Police Department, the Maine State Police Crime Laboratory and the FBI investigated the case.
Armed Drug Trafficker Sentenced to PrisonRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051ROCHESTER, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Lorenzo Wade, 25, of Rochester, who previously pleaded guilty before United States District Judge Elizabeth A. Wolford to the felony charges of possession with intent to distribute a fentanyl analogue and felon in possession of a firearm and ammunition, was sentenced to serve a seven year prison term in the custody of the United States Bureau of Prisons. He also was sentenced to four years of supervised release.
Assistant U.S. Attorney Charles Moynihan, who handled the case, stated that Wade, was arrested after law enforcement officers executed a search warrant at 155 McArdle Street, in the City of Rochester, on July 6, 2018. Officers arrested Wade inside the residence. While searching, officers found over 15 grams of a substance containing heroin, fentanyl and a fentanyl analogue, some of which was packaged for distribution. Officers also found a non-functioning Tec-9 semiautomatic pistol, which was loaded with 37 rounds of ammunition.
After arrest, Wade told officers he bought the handgun for $800. He said he knew the firearm did not function because he had tried it. He said he used the handgun as a prop in the music videos he made. Wade also admitted to selling drugs.
The matter was brought by the United States Attorney’s Office as part of its Project Safe Neighborhoods (PSN) initiative. PSN is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
The sentencing is the result of an investigation by the Greater Rochester Area Narcotics Enforcement Team, the Drug Enforcement Administration, under the direction of Special Agent-in-Charge Ray Donovan and the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent-in-Charge John B. Devito
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Anti Defamation League (ADL) Honors Team that Prosecuted James Fields Jr. with SHIELD Award at 10th Annual Ceremony in Washington, D.C.Read the Press Release
Roanoke, VIRGINIA – On Wednesday, February 26, the Anti Defamation League (ADL) honored a team of local, state, and federal law enforcement partners, who worked together to prosecute James Fields Jr., the white supremacist who was convicted of more than two-dozen hate crimes for a car attack in Charlottesville, Virginia in August 2017, with ADL SHIELD Awards during the group’s 10th Annual awards ceremony at the National Press Club in Washington, D.C.
Since 2010, the ADL annually recognizes law enforcement for significant contributions toward protecting the American people from hate crimes, extremism, and domestic or international terrorism.
Among the recipients of this year’s ADL SHIELD Award were the local, state, and federal agencies, and individuals, that investigated, prosecuted, and assisted in the prosecution, of James Fields, Jr. The ADL recognized contributions from the United States Attorney’s Office for the Western District of Virginia, the Department of Justice, Office of Civil Rights, the Federal Bureau of Investigation, the Virginia State Police, the Charlottesville City Police Department, the Albemarle County Police Department, the City of Charlottesville Commonwealth’s Attorney’s Office, and the University of Virginia Police Department.
“The awful events of August 12, 2017, including James Fields’ act of domestic terrorism, left an indelible mark on the local Charlottesville community, the Commonwealth of Virginia, and our country,” U.S. Attorney Thomas T. Cullen stated today. “Although we couldn’t bring Heather Heyer back or heal the permanent physical and psychological injuries suffered by dozens of others, we could seek meaningful justice for these victims, their families, and the community and send a clear message that hate-inspired acts of violence, murder, and terror will be met with the full and collective force of American law enforcement. I am very proud of our federal, state, and local partners and grateful to the ADL for recognizing their extraordinary achievements.”
On August 12, 2017, after attending the Unite the Right Rally in Charlottesville and returning to his vehicle, Fields drove his car onto Fourth Street, a narrow, downhill, one-way street in downtown Charlottesville. At or around that same time, a racially and ethnically diverse crowd had gathered at the bottom of the hill, at the intersection of Fourth and Water Streets. Many of the individuals in the crowd were celebrating as they were chanting and carrying signs promoting equality and protesting against racial and other forms of discrimination. Fields slowly proceeded in his vehicle down Fourth Street toward the crowd. He then stopped and observed the crowd while idling in his vehicle. With no vehicle behind him, Fields then slowly reversed his vehicle toward the top of the hill.
The members of the crowd began to walk up the hill, populating the streets and sidewalks between the buildings on Fourth Street. Having reversed his car to a point at or near the top of the hill and the intersection of Fourth and Market Streets, Fields stopped again. Fields admitted that he then rapidly accelerated forward down Fourth Street in his vehicle, running through a stop sign and across a raised pedestrian mall, and drove directly into the crowd. Fields’s vehicle stopped only when it struck another stopped vehicle near the intersection of Fourth and Water Streets. Fields then rapidly reversed his car and fled the scene. As Fields drove into and through the crowd, Fields struck numerous individuals, killing Heather Heyer and injuring at least 28 others.
As the ADL recognized, local, state, and federal investigators undertook a massive coordinated investigation in the aftermath of Fields’ act of domestic terrorism. Investigators collected and reviewed over 5,000 hours of video footage related to the Unite the Right Rally, interviewed hundreds of witnesses and victims, and completed an exhaustive review of Fields’ background and social-media profile to develop evidence of his racial and anti-Semitic motivations. As a result of these extraordinary efforts, Fields was convicted of 29 federal hate crimes, as well as first-degree murder in state court, and is currently serving multiple life sentences.
27 February 2020
West Saint Paul Man Pleads Guilty to Armed Robberies of Several Twin Cities Restaurants and Gas StationsRead the Press Release
United States Attorney Erica H. MacDonald today announced the guilty plea of DELFONZO DENELL WALLACE, 30, to eight counts of interference with commerce by robbery, known as the Hobbs Act. The Hobbs Act prohibits actual or attempted robbery affecting interstate or foreign commerce “in any way or degree.” WALLACE, who was charged by an Information on February 20, 2020, entered his guilty plea today before Senior U.S. District Judge Ann Montgomery in U.S. District Court in Minneapolis, Minnesota.
According to the defendant’s guilty plea and documents filed in court, between June 14, 2019, and October 10, 2019, WALLACE, while armed with a dangerous weapon, robbed, in violation of the Hobbs Act, eight separate Twin Cities businesses that were engaged in interstate commerce, including Starbucks, Speedway, Wendy’s, Shuang Hur Supermarket, McDonald’s, and Spitz restaurant. During the robberies, WALLACE used actual and threatened force, violence, and fear of injury against victim employees to steal over $15,000 cash belonging to the businesses and employees. As part of the defendant’s guilty plea and documents filed in court, WALLACE agreed, under the Mandatory Victim Restitution Act, to make restitution to these businesses, as well as to three other business that were robbed between April and September 2019.
This case is the result of an investigation conducted by the Federal Bureau of Investigation (FBI), the Minneapolis Police Department, the St. Paul Police Department, and other local police departments.
Assistant United States Attorney Benjamin Bejar is prosecuting the case.
Defendant Information:
DELFONZO DENELL WALLACE, 30
West St. Paul, Minn.
Convicted:
- Interference with commerce by robbery (Hobbs Act), 8 counts
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
West County Doctor Sentenced to 24 Months in Prison for Making a False Claim to MedicareRead the Press Release
St. Louis, MO – Dr. Brij R. Vaid, M.D., 58, of Ladue, MO, was sentenced today to 24 months of imprisonment and order to pay restitution of $176,912.86 to the Medicare and Missouri Medicaid programs. Dr. Vaid previously pleaded guilty on October 29, 2019, to making a false claim to Medicare. Dr. Vaid’s co-defendant in this case was Nurse Practitioner Donna Waldo. Waldo was sentenced on February 10, 2020, to four years probation, a $4000 fine, and $48,669 as restitution to Medicaid. The Honorable Audrey G. Fleissig imposed the sentence today.
According to court documents, Dr. Vaid was a medical doctor who operated St. Louis Internal Medicine (SLIM), where he saw patients at his medical office in St. Louis County, Missouri. Waldo was a nurse practitioner and advanced practice registered nurse. Waldo worked under the supervision of Dr. Vaid at SLIM.
As alleged in the Superseding Indictment, Dr. Vaid had a large number of patients who received Schedule II controlled substance prescriptions typically every 30 days, including opioid pain relief drugs such as Oxycodone® and Hydrocodone and anti-anxiety drugs such as Xanax®. Dr. Vaid was the only person at his office who had the credentials to legally prescribe these pain management and anti-anxiety drugs.
Dr. Vaid traveled frequently, including trips to New Jersey and India. Given the number of patients needing drugs and his own scheduling challenges, Dr. Vaid often signed numerous prescriptions for controlled substances in advance of patients' visits -- before patients had even visited the office or had an examination. Dr. Vaid instructed his staff, including Waldo, to provide these pre-signed prescriptions for controlled substances to patients later, while he was absent from the office. After patients visited his office, Dr. Vaid and Waldo caused claims for reimbursement to be presented to Medicare and Medicaid in which they represented that Dr. Vaid had met face-to-face with the patients and engaged in complex medical decision-making during the office visits.
In his plea agreement, Dr. Vaid admitted that on February 23, 2015, he was out of the country in India. Waldo saw patient B.T. Dr. Vaid knew that Ms. Waldo would be seeing patient B.T. while Dr. Vaid was in out of town. Dr. Vaid caused the presentation of a false claim to Medicare related to the February 23, 2015, office visit. This claim, submitted under CPT code 99214 to Medicare, falsely stated that Dr. Vaid had provided a face-to-face office visit with patient B.T. when he was really out of town. Before imposing the sentence, U.S. District Judge Audrey G. Fleissig ruled that Dr. Vaid’s conduct created a reckless risk of bodily injury to his patients, given the powerful prescription opioid drugs that he repeatedly provided to patients.
In his plea agreement, Dr. Vaid further admitted that he violated the terms of his probation agreement with the Missouri Board of Registration for the Healing Arts when committing this offense.
“The Missouri Attorney General’s Medicaid Fraud Control Unit works tirelessly every day to root out, investigate, and aggressively prosecute instances of healthcare fraud in Missouri. Working with our federal partners, including the U.S. Attorney’s Office, is a crucial component of that effort, and this case is a great example of how state and federal partnerships can lead to great results" said Eric Schmitt, the Attorney General of Missouri.
“Dr. Vaid threatened the health and lives of his patients by prescribing powerful drugs, including opioids, without even a simple examination,” said Curt L. Muller, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services. “Together with our State and Federal law enforcement partners, we will guard taxpayer-funded government healthcare programs and those dependent on their services.”
This case was investigated by the Office of Inspector General for the U.S. Department of Health and Human Services, the Drug Enforcement Administration, the Medicaid Fraud Control Unit of the Missouri Attorney General’s Office, and the U.S. Department of Defense, Office of Inspector General, Defense Criminal Investigative Service, with critical assistance from the U.S. Customs and Border Protection, U.S. Department of Homeland Security and the Missouri Department of Health and Senior Services, Bureau of Narcotic and Dangerous Drugs.
Union County Man Arrested for Mortgage Fraud and Defrauding the Orange Public LibraryRead the Press Release
NEWARK, N.J. – A Union County, New Jersey, man was arrested today by federal agents on charges of mortgage fraud and scheming to defraud the Orange Public Library, U.S. Attorney Craig Carpenito announced.
Shenandoah Adams Sr., a/k/a “Shane Adams Sr.,” 54, of New Providence, New Jersey, is charged by indictment with six counts of wire fraud and two counts of making false statements in connection with a mortgage loan. He is scheduled to appear this afternoon before U.S. Magistrate Judge Leda Dunn Wettre in Newark federal court.
According to the indictment:
Adams was a principal of Adams Property Management and Investment Group Limited Liability Company (Adams Property Management), which purchased property on Hilton Street in East Orange, New Jersey, in 2014. The following year, Adams arranged for a close associate (Individual 1) to obtain a $153,562 loan from a mortgage lender to purchase the Hilton Street property from Adams Property Management. Adams knew that Individual 1 did not have the money to pay the balance of the purchase price of $225,000. At the closing on March 25, 2015, Adams directed Individual 1 to issue a fraudulent check in the amount of $90,280.47 (the balance of the purchase price) to give the false impression that Individual 1 had paid the closing balance. Adams reassured Individual 1 that Adams would not negotiate the check. Adams signed a settlement statement, falsely certifying that Individual 1 paid the closing balance and that the settlement statement was a true and accurate statement of all receipts and disbursements made in connection with the sale of the Hilton Street property, when Adams knew that Individual 1’s check was fraudulent. Adams used Individual 1’s loan proceeds to pay off Adams Property Management’s $100,000 mortgage loan to purchase the Hilton Street Property and to obtain a $26,335.30 check for Adams Property Management.
Although Adams reassured Individual 1 that Adams would fund Individual 1’s mortgage payments, by May 2016 Individual 1’s mortgage payments on the Hilton Street property were substantially in arrears. Adams arranged for Individual 1 to sell the property to another associate for a price of $255,000. The closing on that sale commenced on May 31, 2016; the total amount to pay off Individual 1’s mortgage was $210,565.34. On June 1, 2016, Adams and Individual 1 had a telephone conversation with an out-of-state representative of the mortgage servicer for Individual 1’s lender, during which Adams made false and fraudulent statements to induce the lender to reduce the payoff amount. The lender agreed to reduce Individual 1’s payoff amount to $190,000. At Adams’s direction, Individual 1 cashed the check for the amount of the reduction, $20,665.34, and delivered the cash proceeds to Adams.
Adams also was a principal of VH Electrical and Plumbing Limited Liability Company (VH). On March 11, 2015, Adams, on behalf of VH, entered into a contract with the Orange Public Library to replace the library’s HVAC/Chiller unit for a price of $49,000. The project was funded by a U.S. Department of Housing and Urban Development (HUD) Community Development Block Grant to the library and Orange.
Before getting the contract with the library, Adams sent the library’s executive director, Timur Davis, two fake quotes purportedly from two vendors to give the false impression that VH would replace the library’s chiller for less than those other vendors. After VH had been hired, Adams sent Davis records to give the false impression that Adams was taking steps to order a replacement chiller. Adams received $40,000 from the library, but did not replace the chiller. Davis pleaded guilty on Feb.13, 2020 to making false statements to HUD in connection with the project.
The charges of wire fraud carry a maximum potential penalty of 20 years in prison and a maximum $250,000 fine. The charges of making false statements in connection with a mortgage application carries a maximum potential penalty of 30 years in prison and a maximum potential fine of $1 million.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark; special agents of the U.S. Department of Housing and Urban Development, Office of Inspector General, under the direction of Special Agent in Charge Christina Scaringi; and special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge John R. Tafur, with the investigation leading to today’s arrest.
The government is represented by Assistant U.S. Attorneys J Imbert and Cari Fais of the U.S. Attorney’s Office’s Special Prosecutions Division.
The charges and allegations contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Defense counsel: TBD
U.S. Attorney Announces Women in Leadership Initiative, Appoints New First Assistant U.S. Attorney for UtahRead the Press Release
SALT LAKE CITY– United States Attorney John W. Huber announced today the creation of Utah Women in Leadership (UWIL), an inter-agency initiative designed to bring together employees of the U.S. Attorney’s Office, the Federal Public Defender’s Office, U.S. District Court, the U.S. Probation Office, the U.S. Marshals Service, and other federal agencies and civil practitioners to foster professional development and association.
UWIL will offer quarterly presentations by speakers and panels on a variety of topics, including mentor/mentee relationships, leadership and courage, the art of a balanced life, effective communication, bias/diversity/inclusion, leading out/leaning in, and being the only woman in the room. In addition, UWIL is committed to community service and outreach to younger women who have an interest in federal public service work.
Elizabeth Kronk Warner, Dean of the University of Utah’s S.J. Quinney College of Law, and the first woman and first Native American to hold that title, was the inaugural speaker for UWIL. She spoke on Thursday at the U.S. Attorney’s Office about the experiences that have defined her professionally and personally.
Future speakers for UWIL will include community and business leaders, educators, professional coaches, and athletes, among others.
While the U.S. Attorney’s Office is taking a leadership role in organizing the group, which will be chaired by Jennifer E. Gully, an Assistant U.S. Attorney. A steering committee comprised of representatives from other federal agencies and partners will lead the group.
Steering Committee members for 2020-2021 include Melina Shiraldi, Assistant U.S. Attorney; Daphne Oberg, Assistant Public Defender; Anne Morgan, Chief Deputy Clerk, U.S. District Court; Kathryn Kerkhoff, Special Agent, Department of Transportation, Office of the Inspector General; Carissa Spencer, Special Agent, Housing and Urban Development, Office of the Inspector General; and Elizabeth Schulte, Department of the Interior, Office of the Solicitor.
Huber used Thursday’s inaugural meeting to announce the appointment of a new First Assistant U.S. Attorney for Utah. Andrea Martinez, currently the Deputy Section Chief of Violent Crimes, will become the second in command in the U.S. Attorney’s Office. Her predecessor, Jared Bennett, will begin service as a federal magistrate judge in May.
Ms. Martinez has served in a number of key positions during her 10 years in the office, including Senior Litigation Counsel, Project Safe Childhood Coordinator, and the Violence Against Women Act Coordinator. She has also served as the office’s Diversity Chairperson for more than six years. Prior to joining the U.S. Attorney’s Office in 2010, she was a state court prosecutor for more than eight years.
“Andrea’s demeanor is one of calm confidence and professionalism. She is approachable to all, and impeccably trustworthy. Although strong and certainly one who can hold to a worthy position, she is also humble and willing to see another’s perspective. In her supervisory capacity, she has gained experience in fostering success in others. She has numerous skills that will make her an excellent First Assistant U.S. Attorney in our office,” U.S. Attorney John W. Huber said.
Trucker sentenced for hauling 300 kilograms of marijuana disguised inside clear wrapping paperRead the Press Release
LAREDO, Texas – A 49-year-old Carrizo Springs resident has been ordered to federal prison following his conviction for conspiring to possess with the intent to distribute more than 300 kilograms of marijuana, announced U.S. Attorney Ryan K. Patrick.
Vicente Guajardo-Cantu pleaded guilty Nov. 4, 2019.
Today, U.S. District Judge Marina Garcia Marmolejo sentenced Guajardo-Cantu to serve a 60-month term of imprisonment to be immediately followed by four years of supervised release.
Guajardo-Cantu worked as a truck driver with a North Dakota commercial driver’s license. On Sep. 16, 2017, he arrived at the U.S. Highway 83 checkpoint driving his tractor-trailer. During an initial inspection, a K-9 alerted to the trailer he was hauling. There, authorities ultimately found 28 cellophane bundles of marijuana hidden inside the trailer.
Further investigation also revealed he presented a fraudulent bill of landing during the primary inspection.
The drugs weighed a total of 312 kilograms (688 pounds) with a street value of approximately $200,000.
He has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The Drug Enforcement Administration and Border Patrol conducted the investigation. Assistant U.S. Attorney Francisco J. Rodriguez prosecuted the case.
Three Men Plead Guilty to Drug Federal CrimesRead the Press Release
HUNTINGTON, W.Va. – Three men pled guilty to federal drug crimes before United States District Judge Robert C. Chambers in Huntington, announced United States Attorney Mike Stuart.
“Three more out-of-state drug dealers that were peddling deadly poisons in Huntington stand convicted of their crimes,” said United States Attorney Mike Stuart. “We’re making great progress in Huntington because of partnerships, collaboration, and a focus on tough prosecution.”
Demaurea Davis, 23, of Akron, Ohio, pled guilty to possession with intent to distribute fentanyl. Davis admitted that while serving a state sentence of home confinement, he possessed approximately 40 grams of heroin and fentanyl in his residence. On January 29, 2018, officers searched his residence and located approximately 40 grams of heroin and fentanyl. Davis admitted that he intended to sell the heroin and fentanyl. Davis faces up to twenty years in prison when sentenced on June 8, 2020.
Rudolph Jackson, 42, also of Akron, pled guilty to a five count indictment which charged him with selling heroin and aiding and abetting the possession with intent to distribute methamphetamine and heroin. Jackson admitted that on four separate occasions he sold heroin to a confidential informant in Huntington. Jackson also admitted that on August 22, 2019, officers with the Huntington Police Department executed a search warrant at 702 Washington Avenue, Apartment 7 in Huntington. Officers found distribution quantities of methamphetamine and heroin inside the apartment. Jackson admitted he intended to aid other individuals in selling the methamphetamine and heroin. Jackson faces up to twenty years in prison when sentenced on June 1, 2020.
Alonzo Wayne Clay, Jr., 31, of Austin, Texas pled guilty to possession with intent to distribute crack cocaine. Clay admitted that on September 18, 2019, he fled from officers in his vehicle. Once he stopped his vehicle, officers found approximately 25 grams of crack cocaine and 1,000 ecstasy pills in his vehicle. He admitted he intended to sell the crack cocaine and the ecstasy pills. Clay faces up to twenty years in prison when sentenced on June 8, 2020.
The Huntington Police Department conducted the investigations. Assistant United States Attorney Stephanie Taylor is handling the prosecutions.
The Davis and Jackson cases are being prosecuted as part of Operation Synthetic Opioid Surge (S.O.S.), an enforcement surge that seeks to reduce the supply of deadly synthetic opioids in high impact areas.
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Suburban Man Sentenced to More Than 12 Years in Prison for Amassing Child Pornography CollectionRead the Press Release
CHICAGO — A suburban man has been sentenced to more than a dozen years in federal prison for amassing a collection of nearly 200,000 images and videos of child pornography.
JONATHAN STEPHENS, 50, of Forest Park, used a computer to access file-sharing software and download child pornography. Over a period of at least four years, Stephens amassed a collection of approximately 194,000 sexually explicit images and videos that he stored on computers and external hard drives in his home and which he allowed other users to access and download. Many of the minors in the images and videos were under the age of 12 and forced to engage in sadistic and masochistic conduct.
Stephens pleaded guilty in 2018 to one count of transportation of child pornography. U.S. District Judge Ronald A. Guzman on Wednesday sentenced Stephens to 12 years and seven months in prison, to be followed by nine years of supervised release. Judge Guzman also ordered Stephens to pay $187,500 in restitution to the known child victims.
The sentence was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago office of the FBI. The case was investigated by the FBI’s Child Exploitation and Human Trafficking Task Force, specifically members from the Cook County Sheriff’s Office and Cook County State Attorney’s Investigations Bureau, as well as the Forest Park Police Department.
“The defendant’s victims are numerous,” Assistant U.S. Attorney Jeannice W. Appenteng argued in the government’s sentencing memorandum. “Each child depicted in the images and videos went through a horrible experience and continues to relive that suffering and endure new suffering because of the defendant’s actions.”
The government was represented in the case by Ms. Appenteng and Assistant U.S. Attorney Jared C. Jodrey.
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.
Straw Purchaser Convicted for Role in Firearms TraffickingRead the Press Release
RICHMOND, Va. – A federal jury convicted a Chester man yesterday on charges related to his straw purchase of six firearms.
According to court records and evidence presented at trial, Brandon Andrea Powell, 41, purchased six firearms at three federally licensed firearms dealers in the Richmond area during August and September 2015. When purchasing the firearms, Powell falsely stated that he was the actual purchaser of the firearms, when in fact, he was straw purchasing them for an individual named Trenton Pointer. Pointer provided the guns to Abdul Shashid Davis, who in turn, sold them to an undercover New York City Police Detective.
Powell was convicted of making a false statement to acquire a firearm. He faces a maximum penalty of 40 years in prison at sentencing. 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.
Pointer and Davis were charged, convicted, and sentenced in New York State for their role in this scheme.
Nine other federal defendants have been sentenced for making false statements in connection with this scheme:
Name, Age
Hometown
Felony Conviction
Sentence
Cherie Elanda Wyatt, 42
Richmond
False Statement to Acquire Firearm
1 year of probation
Kevin Edward Wilson, 29
Powhatan
False Statement to Acquire Firearm
2 years of probation, 180 days of home detention
Denise Michelle Sinkford, 41
Richmond
False Statement to Acquire Firearm
2 years of probation, 180 days of home detention
Shanta Teisha Brown, 29
Richmond
False Statement to Acquire Firearm
2 years of probation, 60 days of home detention
Evelyn Jean Collins-Chandler, 54
Richmond
Conspiracy to Make False Statements to Acquire Firearm
2 years of probation, 60 days of home detention
Ebony Danielle Clarke, 34
Richmond
False Statement to Acquire Firearm
3 years of probation, 210 days of home detention
Jeremy Durand Lewis, 35
Chesterfield County
False Statement to Acquire Firearm
2 1/2 years in prison
Yolanda Lisa Stone, 47
Richmond
False Statement to Acquire Firearm
2 years of probation, 7 months of home detention
Jeffrey Quinton Toole, 56
Richmond
False Statement to Acquire Firearm
13 months in prison
This case is 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. Click here for more information about Project Guardian.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Ashan M. Benedict, Special Agent in Charge of the ATF’s Washington Field Division, made the announcement after U.S. District Judge David J. Novak accepted the verdict. Assistant U.S. Attorney Michael C. Moore is prosecuting the case.
Special assistance in this investigation and prosecution was provided by the New York City Police Department and the New York County District Attorney’s Office.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case Nos. 3:18-cr-37, 56, 77, 86, 110, 120, 138, 154, and 3:19-cr-13.
Stevens Point Man Sentenced to 18 Years for Producing Child PornographyRead the Press Release
MADISON, WIS. - Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Nicholas Kvatek, 41, Steven Point, Wisconsin, was sentenced today by U.S. District Judge William M. Conley to 18 years in federal prison for producing child pornography. This term of imprisonment is to be followed by 25 years of supervised release. Kvatek pleaded guilty to this charge on November 26, 2019.
Following the execution of a search warrant at Kvatek’s home, law enforcement officers found two videos of Kvatek sexually assaulting a then 14-year-old girl. In addition to the two videos produced by Kvatek which were the subject of his guilty plea, officers also found numerous images of prepubescent and toddler girls being sexually assaulted. Kvatek did not appear in these images.
In sentencing the defendant, Judge Conley was concerned about the fact that Kvatek had a lengthy criminal history that seemed to be escalating. Judge Conley also expressed concerns about the defendant’s history of drug use and was concerned the defendant did not understand the seriousness of his actions.
The charge against Kvatek was the result of an investigation conducted by Stevens Point Police Department and the Portage County Sheriff’s Office. The prosecution of the case has been handled by Assistant U.S. Attorney Elizabeth Altman.
This investigation was a part of Project Safe Childhood, a nationwide initiative to combat child sexual exploitation and abuse. Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims.
Statement of U.S. Attorney William M. McSwain Regarding Proposed Drug Injection Site in South PhiladelphiaRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain released the following statement regarding the proposed drug injection site in South Philadelphia today:
Yesterday morning, Safehouse announced during a press conference that it intends to open a heroin injection site in South Philadelphia next week – although it did not specify the precise location or the precise date, in keeping with Safehouse’s consistent lack of transparency in dealing with the community. By contrast, I wanted to update the community on the efforts of the U.S. Attorney’s Office to prevent this proposed site from opening. First, yesterday afternoon, my Office filed its official Notice of Appeal with the U.S. District Court, which begins the process of the U.S. Court of Appeals for the Third Circuit’s review of the District Court’s decision. Second, my Office will be filing a motion today for the District Court to stay its final order during the pendency of the appeal.
This request for a stay is critically important. My Office filed suit against Safehouse in the first place to bring order, reason and fairness to a potentially explosive situation. The current dispute over injection sites should be settled in the courts, not in the streets. But, that court process is not over, and I believe that a stay is appropriate so that the dispute will continue to be resolved via careful, reasoned analysis and not deteriorate into a literal street fight. Here, a stay would preserve the status quo while the Third Circuit examines the legality of the proposed site, and would prevent the chaos that would occur should Safehouse lurch forward with an opening while the case is still ongoing.
This unnecessary chaos was on full display at Safehouse’s press conference yesterday morning. That press conference was a dumpster fire.
The press conference featured, among other things, understandably angry South Philadelphia residents yelling at former Governor Rendell, calling him unworthy of the title of Governor and berating him as a “sneak” for hiding his intention to locate the first injection site in South Philadelphia, as well as a sitting City Councilman (Mark Squilla) screaming at Safehouse’s founders that their proposal was “horrible and a disgrace” and “not a part of democracy” because he and his constituents had never been informed about Safehouse’s plans.
It also featured plenty of logical inconsistency: Governor Rendell, for example, claimed that an injection site in Philadelphia would have saved the life of his friend’s son (who tragically overdosed in his parents’ home) on the assumption that this young man would have traveled from the suburbs to the site to inject. Immediately contradicting this, Safehouse co-founder Ronda Goldfein, in response to angry questions from South Philadelphia residents who fear that the site would draw addicts to their neighborhood, adamantly insisted that “nobody” from outside the South Philadelphia neighborhood would use the site. Goldfein quickly became irritated with the residents’ legitimate questions; things got so bad that she threw in the towel and deferred any questions to an imaginary, future community meeting to be held at an unnamed time and place.
The sad fact is that Safehouse’s secretive, haphazard “plan” has not been vetted with any of the affected neighborhood residents, community groups, City Council members, State Representatives or State Senators. It is being unfairly foisted on them on the assumption that they don’t matter. It is treating them like fools.
The residents of Philadelphia deserve better than this. And my Office will continue to fight for it – and for them.
Statement of U.S. Attorney Kennedy Regarding the Cayuga Nation of Indians Dispute in Seneca County, NYRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051The United States Attorney’s Office for the Western District of New York shares the public's concerns regarding the impact that this internal dispute within the Cayuga Nation of Indians has on the public safety of all members of our community. My Office, together with the Department of Justice—Office of Tribal Justice (DOJ-OTJ), and other DOJ components, is collecting information regarding the pre-dawn events of February 22, 2020, and assessing whether any violations of applicable law occurred. We are engaged in ongoing discussions with Department of Interior, Bureau of Indian Affairs (BIA), regarding both the circumstances giving rise to the incident, the incident itself, and potential responses. In addition, we have requested the assistance of both BIA as well as DOJ's Community Relations Service (CRS) in the dispute. Across the Department of Justice, our paramount objective is the preservation of public safety. We will continue to work with our federal, state, and local partners in pursuit of that goal, as we do all that we can to ensure that all involved exhibit respect not only for applicable law—but for one another as well.
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St. Louis County Business Owner Pleads Guilty to Failing to Pay over Employee Withholding Taxes and Failing to File Personal Tax ReturnsRead the Press Release
St. Louis, MO – Craig Gustafson, 45, of Grover, MO, pled guilty to twenty counts of failing to remit employee withholding taxes to the Internal Revenue Service, and four counts of failing to file personal income tax returns. Gustafson appeared today before U.S. District Judge Rodney Sippel who accepted his plea and set sentencing for June 5, 2020.
According to the plea agreement, Gustafson owned and operated Consumers Periodical Service of Missouri, Inc., a magazine subscription business in St. Louis County, Missouri. From 2013 through 2017, Gustafson withheld quarterly federal income and social security taxes from his employees, but failed to remit those taxes to the Internal Revenue Service as required. Gustafson issued annual W-2 forms to his employees which reflected the withheld taxes in order to lull those employees into believing that their withheld taxes had been properly remitted to the Internal Revenue Service. Further, for the tax years 2013 through 2016, Gustafson failed to file his own annual personal income tax forms and failed to pay personal income taxes owed to the Internal Revenue Service. During that period, Gustafson earned at least $670,400 from his company, and the tax loss to the United States from his failure to file tax forms and pay over required taxes was $131,296.
“Employers have a responsibility to their employees to withhold the proper amount of taxes and pay those taxes over to the IRS,” said IRS Criminal Investigation Special Agent in Charge Karl Stiften. “When employers fail to do so, it results in a loss of revenue to the United States government, but more importantly, it could affect their employees’ Medicare and Social Security benefits.”
The failure to remit employee withholding taxes charges each carry a maximum possible penalty of five years imprisonment, a fine of $10,000 or both imprisonment and a fine. The failure to file annual tax forms charges each carry a maximum possible penalty of one year imprisonment, a fine of $25,000, or both imprisonment and a fine. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the Internal Revenue Service, Criminal Investigation. Assistant United States Attorney Lindsay McClure-Hartman is handling the case for the United States Attorney’s Office.
Springfield Man Sentenced to 10 Years for Illegal FirearmRead the Press Release
SPRINGFIELD, Mo. – A Springfield, Missouri, man has been sentenced in federal court for illegally possessing a firearm.
Dionysus Azeria Hale, 40, was sentenced by U.S. District Judge Brian C. Wimes on Monday, Feb. 24, to 10 years in federal prison without parole, which is the statutory maximum for this offense.
On Aug. 14, 2019, Hale pleaded guilty to being a felon in possession of a firearm.
According to court documents, Springfield police officers executed a search warrant at Hale’s residence on Feb. 20, 2019, as part of an investigation into the distribution of heroin and/or fentanyl. In Hale’s front right pocket were two zipper pouches that contained a total of $3,264. Officers found a loaded Glock .40-caliber semi-automatic pistol with an extended capacity magazine in the bedroom. Hale’s sentence reflects the court’s ruling that Hale used or possessed the firearm in connection with a drug-trafficking offense.
Under federal law, it is illegal for anyone who has been convicted of a felony to be in possession of any firearm or ammunition. In 2001, Hale was convicted of possession of a controlled substance in two separate cases and was given a suspended two-year sentence, but his probation was revoked due to incurring numerous violations. In 2002, Hale was convicted of possession with the intent to distribute and possession of a controlled substance and had his parole revoked numerous times for various violations. While on parole, Hale committed and was convicted of possession with intent to distribute a controlled substance, and once again had his probation and parole revoked due to numerous violations.
While on supervision for possession with intent to distribute a controlled substance, Hale committed and was convicted of being a felon in possession of a firearm. Hale was sentenced to 80 months in federal prison and released on Jan. 6, 2017. Upon being placed on supervised release, he incurred violations that led to a revocation of his supervised release and received a seven-month sentence and a new two-year term of supervised release. While on his new term of supervised release, he committed this offense of being a felon in possession of a firearm.
This case was prosecuted by Assistant U.S. Attorney Ami Harshad Miller. It was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Springfield, Mo., Police Department.
Project Safe Neighborhoods
The U.S. Attorney’s Office is partnering with federal, state, and local law enforcement to specifically identify criminals responsible for significant violent crime in the Western District of Missouri. A centerpiece of this effort is Project Safe Neighborhoods, a program that brings together all levels of law enforcement to reduce violent crime and make neighborhoods safer for everyone. Project Safe Neighborhoods is an evidence-based program that identifies the most pressing violent crime problems in the community and develops comprehensive solutions to address them. As part of this strategy, Project Safe Neighborhoods focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.South Carolina man sentenced to 30 years in prison for the kidnapping and sexual assault of an Alabama womanRead the Press Release
Anthony Ingram, 32, was sentenced today for kidnapping and sexually assaulting an Alabama woman. United States District Judge Sara Lioi sentenced Ingram to 30 years in prison followed by five years of supervised release. A jury previously convicted Ingram after a week-long trial in October.
According to court records and evidence presented at trial:
Ingram worked for a cross-country trucking company. On August 10, 2018, Ingram, while in Michigan, offered to transport an Alabama woman to Indiana so she could retrieve her vehicle. Unbeknownst to the woman, Ingram had no intention of taking her to Indiana. Instead, Ingram drove the woman into Ohio and repeatedly ignored her pleas to be released from the truck. Hours later, Ingram pulled the truck over on the Ohio Highway near Hudson, Ohio, where he forced the woman into the rear of the cab, struck her in the face, threatened her with a weapon and sexually assaulted her. After the attack, Ingram continued driving into Pennsylvania. Ingram stopped at a rest stop along the Pennsylvania highway, at which time the woman was able to escape and call for help. Ingram fled and was arrested hours later in Pennsylvania.
The Federal Bureau of Investigation and the Ohio State Highway Patrol investigated the case, with assistance from the Beaver Township Police Department, Pennsylvania State Police, and the Summit County Prosecutor’s Office. The case was prosecuted by Assistant U.S. Attorneys Peter Daly and Aaron Howell.
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Six Indicted on Federal Drug Charges in DanvilleRead the Press Release
Danville, VIRGINIA – In an indictment returned under seal earlier this month and unsealed recently following the defendants’ recent arrests, a federal grand jury sitting in U.S. District Court in Roanoke has charged six Danville-area residents with conspiring to distribute and possess with the intent to distribute methamphetamine. United States Attorney Thomas T. Cullen and Special Agent in Charge Ashan M. Benedict of the Bureau of Alcohol, Tobacco, Firearms, and Explosives [ATF] Washington Field Division announced the indicted today.
Charged in the indictment are Darrell William Murdock, 33, of Danville, Va., Steven Ray Dove, 41, of Danville, Va., Bendi Annette Davis, 47, of Ringgold, Va., Steven Wayne Flynn, 41, of Orange, Va., Lianna Nicole Parker, 30, of Lynchburg, VA, and Misty Nicole Kiley, of Danville, Va.
The grand jury charged all six defendants with one count of conspiracy to distribute and possess with the intent to distribute methamphetamine. In addition, Murdock is charged with two counts of distribution of methamphetamine, one count of distribution and possession with the intent to distribute methamphetamine, and one count of possession of a firearm in furtherance of a drug trafficking crime. Davis is charged with two counts of distribution of cocaine and one count of distribution of methamphetamine. Dove is charged with two counts of distribution of methamphetamine, one count of distribution and possession with the intent to distribute methamphetamine, and one count of illegal possession of a firearm by a previously convicted felon. Flynn is charged with one count of illegal possession of a firearm by a previously convicted felon and one count of possession of a firearm in furtherance of a drug trafficking crime.
The investigation of the case was conducted by Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Drug Enforcement Administration, and the Danville Police Department. Assistant United States Attorney Rachel Swartz is prosecuting the case for the United States.
A Grand Jury Indictment is only a charge and not evidence of guilt. The defendants are entitled to a fair trial with the burden on the government to prove guilt beyond a reasonable doubt.
Researcher at University Arrested for Wire Fraud and Making False Statements About Affiliation with a Chinese UniversityRead the Press Release
UPDATE
The defendant in this case, Anming Hu, was acquitted by the court of the charges alleged in the indictment described in the press release below.
Anming Hu, a an Associate Professor in the Department of Mechanical, Aerospace and Biomedical Engineering at the University of Tennessee, Knoxville (UTK) was arrested today on a federal indictment and charged with three counts of wire fraud and three counts of making false statements.
“Hu allegedly committed fraud by hiding his relationship with a Chinese university while receiving funding from NASA,” said Assistant Attorney General for National Security John C. Demers. “This is just the latest case involving professors or researchers concealing their affiliations with China from their American employers and the U.S. government. We will not tolerate it.”
“The United States Attorney’s Office takes seriously fraudulent conduct that is devised to undermine federally-mandated funding restrictions related to China and Chinese universities,” said U.S. Attorney J. Douglas Overbey for the Eastern District of Tennessee. “The University of Tennessee has cooperated with the investigation, and the U.S. Attorney’s Office values the university’s assistance in this matter.”
The indictment alleges that beginning in 2016, Hu engaged in a scheme to defraud the National Aeronautics and Space Administration (NASA) by concealing his affiliation with Beijing University of Technology (BJUT), a university in China. Federal law prohibits NASA from using appropriated funds on projects in collaboration with China or Chinese universities. As alleged in the indictment, Hu’s false representations and omissions to UTK about his affiliation with BJUT caused UTK to falsely certify to NASA that UTK was in compliance with this federal law.
If convicted, Hu faces up to 20 years in federal prison and a fine up to $250,000 on each of the wire fraud counts, and up to five years in prison on each of the false statement counts.
The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the assigned judge. In all cases, defendants are presumed innocent until and unless proven guilty; indictments merely contain allegations supported by probable cause.
The case is being investigated by the FBI, the Offices of the Inspectors General for NASA and the Department of Energy. The case is being prosecuted by Assistant U.S. Attorneys Casey Arrowood and Frank Dale of the Eastern District of Tennessee, and Trial Attorney Nathan Charles of the National Security Division’s Counterintelligence and Export Control Section.
Researcher at University of Tennessee Arrested for Wire Fraud and Making False Statements About Affiliation with A Chinese UniversityRead the Press Release
Knoxville, Tenn. – U.S. Attorney J. Douglas Overbey and FBI Special-Agent-in-Charge Joseph E. Carrico announced today the arrest of a researcher at the University of Tennessee, Knoxville (UTK), following the return of a federal grand jury’s indictment. Anming Hu, 51, an Associate Professor in the Department of Mechanical, Aerospace and Biomedical Engineering at UTK, is charged with three counts of wire fraud and three counts of making false statements.
The indictment alleges that beginning in 2016, Hu engaged in a scheme to defraud the National Aeronautics and Space Administration (NASA) by concealing his affiliation with Beijing University of Technology (BJUT) in China. Federal law prohibits NASA from using federally appropriated funds on projects in collaboration with China or Chinese universities. As alleged in the indictment, Hu’s false representations and omissions to UTK about his affiliation with BJUT caused UTK to falsely certify to NASA that UTK was in compliance with federal law.
“The United States Attorney’s Office takes seriously fraudulent conduct that is devised to undermine federally-mandated funding restrictions related to China and Chinese universities,” said U.S. Attorney J. Douglas Overbey for the Eastern District of Tennessee. “The University of Tennessee has cooperated with the investigation, and the U.S. Attorney’s Office values the university’s assistance in this matter.”
“Hu allegedly committed fraud by hiding his relationship with a Chinese university while receiving funding from NASA,” said Assistant Attorney General for National Security John C. Demers. “This is just the latest case involving professors or researchers concealing their affiliations with China from their American employers and the U.S. government. We will not tolerate it.”
“The FBI and its federal government, private-sector, and academic partners will continue to investigate and collaborate to counter these efforts at concealment, wherever they occur,” said FBI Special-Agent-in-Charge Joseph E. Carrico.
If convicted, Hu faces up to 20 years in federal prison and a fine up to $250,000 on each of the wire fraud counts, and up to five years in prison on each of the false statement counts.
The maximum potential sentences in this case are prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendants will be determined by the assigned judge. In all cases, defendants are presumed innocent until and unless proven guilty; indictments merely contain allegations supported by probable cause.
The case is being investigated by the Federal Bureau of Investigation, the Offices of the Inspectors General for NASA and the Department of Energy, and the Department of Homeland Security-Homeland Security Investigations. The case is being prosecuted by Assistant U.S. Attorneys Casey Arrowood and Frank Dale of the U.S. Attorney’s Office for the Eastern District of Tennessee, and Trial Attorney Nathan Charles of the Department of Justice’s National Security Division’s Counterintelligence and Export Control Section.
This case is part of the Department of Justice’s China Initiative, which reflects the strategic priority of countering national security threats and reinforces the President’s overall national security strategy. In addition to identifying and prosecuting those engaged in trade secret theft, hacking and economic espionage, the initiative will increase efforts to protect our critical infrastructure against external threats including direct foreign investment, supply chain threats and the foreign agents seeking to influence the American public and policymakers without proper registration.
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Queens Pharmacy Owner Found Guilty of Health Care Fraud and Money Laundering Charges for Role in Billing SchemeRead the Press Release
BROOKLYN, NY – A federal jury in Brooklyn returned a guilty verdict last night against pharmacy owner Yuriy Barayev on one count of health care fraud and seven counts of money laundering for his role in a scheme to defraud Medicare by billing for prescription medications that were not provided to patients. The verdict followed a four-day trial before United States District Judge Edward R. Korman. When sentenced, Barayev faces up to 10 years in prison for health care fraud and up to 20 years in prison on each of the money laundering counts.
Richard P. Donoghue, United States Attorney for the Eastern District of New York, Brian A. Benczkowski, Assistant Attorney General of the Justice Department’s Criminal Division, Scott J. Lampert, Special Agent-in-Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), and Jonathan D. Larsen, Special Agent-in-Charge, Internal Revenue Service Criminal Investigation (IRS-CI), announced the verdict.
As proven at trial, from November 2013 to December 2015, Barayev engaged in a scheme to defraud Medicare by submitting claims for hundreds of medications that were never dispensed through his pharmacy, Woodhaven Rx. The evidence further showed that Barayev laundered the proceeds of his health care fraud scheme through a shell company owned by his wife, and then spent the money on himself, his family and friends.
This case was investigated by HHS-OIG and IRS-CI. Trial Attorneys Sarah Wilson Rocha and Debra Jaroslawicz, and Assistant Chief A. Brendan Stewart of the Criminal Division’s Fraud Section are prosecuting the case.
The Fraud Section leads the Medicare Fraud Strike Force. Since its inception, Strike Force prosecutors filed more than 1,750 cases charging more than 3,800 defendants who collectively billed the Medicare program approximately $15 billion; 2,643 defendants pleaded guilty and 338 others were convicted in jury trials; and 2,424 defendants were sentenced to imprisonment for an average term of approximately 50 months. Medicare payment trends demonstrate the positive impact of Strike Force enforcement and prevention efforts.
The Defendant:
YURIY BARAYEV
Age: 45
Queens, New YorkE.D.N.Y. Docket No. 18-CR-318 (ERK)
Queens Pharmacy Owner Found Guilty of Health Care Fraud and Money Laundering Charges for Role in Billing SchemeRead the Press Release
A federal jury found a New York pharmacy owner guilty Wednesday of health care fraud and money laundering charges for his role in a scheme to defraud Medicare by billing for prescription medications that were not provided to patients.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Richard P. Donoghue of the Eastern District of New York, Special Agent in Charge Scott J. Lampert of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Office of Investigations and Acting Special Agent in Charge Jonathan Larsen of Internal Revenue Service Criminal Investigation’s (IRS-CI) New York Field Office made the announcement.
After a four-day trial, Yuriy Barayev, 45, of Queens, New York, was found guilty of one count of health care fraud and seven counts of money laundering. U.S. District Judge Edward R. Korman of the Eastern District of New York, who presided over the trial, will sentence Barayev at a later date.
According to evidence presented at trial, from November 2013 to December 2015, Barayev engaged in a scheme to defraud Medicare by submitting claims for prescription medications that were not actually dispensed to patients. Barayev billed Medicare for hundreds of medications that were never dispensed through his pharmacy, Woodhaven Rx, the evidence showed. The evidence further showed that Barayev laundered the proceeds of his health care fraud scheme by transferring money to a shell company owned by his wife and then spending the money to benefit himself, his family and others close to him.
This case was investigated by HHS-OIG and IRS-CI. Trial Attorneys Sarah Wilson Rocha and Debra Jaroslawicz and Assistant Chief A. Brendan Stewart of the Criminal Division’s Fraud Section are prosecuting the case.
The Fraud Section leads the Medicare Fraud Strike Force. Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 15 strike forces operating in 24 districts, has charged more than 4,200 defendants who have collectively billed the Medicare program for nearly $19 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
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.
Previously convicted sex offender from Las Cruces faces federal child pornography and kidnapping charges in New MexicoRead the Press Release
ALBUQUERQUE, N.M. – Clarence Ransom, 52, of Las Cruces, New Mexico, appeared in federal court in Las Cruces today for arraignment on charges of attempted coercion and enticement of a minor, attempted production of child pornography, solicitation of child pornography, committing a federal offense as a registered sex offender, international parental kidnapping, and failure to report international travel as a sex offender.
A grand jury returned an indictment against Ransom on Jan. 15 charging these offenses. The indictment accuses Ransom of attempting to coerce and entice a child under the age of 18 to engage in sexual activity in Doña Ana County, New Mexico between May 16, 2019 and May 25, 2019. The indictment also accuses Ransom of attempting to produce child pornography with the child.
According to a criminal complaint, Ransom was previously convicted in 1991 of engaging in unlawful sexual acts with a minor. He is required to register as a sex offender and must notify authorities in advance before traveling internationally. Ransom allegedly kidnapped two victims, who are his children, by taking them to Mexico when they should have been in their mother’s custody and without approval to travel outside the United States.
Mexican law enforcement arrested Ransom on Dec. 1, 2019 and later turned him over to U.S. authorities at the border. Ransom made an initial appearance in federal court in the District of Arizona on Dec. 5, 2019 before being transported to New Mexico.
Ransom is currently in custody pending trial. Indictments and criminal complaints are only accusations. A defendant is presumed innocent until proven guilty.
The FBI and Las Cruces Police Department investigated this case with assistance from law enforcement in Mexico. Assistant U.S Attorneys Tilli M. Villalobos, Mark A. Saltman and Dustin Segovia are prosecuting the case.
Plant City Man Sentenced to Seven Years for Possessing Firearm and AmmunitionRead the Press Release
Tampa, Florida – U.S. District Judge Mary S. Scriven has sentenced James Bailey (33, Plant City) to seven years in federal prison for possessing a firearm and ammunition as a convicted felon. The court also ordered Bailey to forfeit the firearm and ammunition.
Bailey had pleaded guilty on October 24, 2019.
According to court documents, on March 12, 2019, law enforcement officers responded to a 911 call regarding an aggravated assault with a deadly weapon. Upon arrival, the officers encountered Bailey and located a loaded sawed-off shotgun, with an obliterated serial number, at the rear of his vehicle. Bailey then fled on foot, but was apprehended after a short foot chase. Following his arrest, Bailey admitted to possessing the firearm. Witnesses also confirmed that Bailey had pointed the shotgun out of his car’s window. Bailey, an 11-time convicted felon, was prohibited from possessing a firearm or ammunition.
This case was investigated by the Federal Bureau of Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Plant City Police Department. It was prosecuted by Assistant United States Attorney David C. Waterman.
This case was brought as part of Project Safe Neighborhoods (“PSN”). PSN is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime. In the Middle District of Florida, U.S. Attorney Maria Chapa Lopez coordinates PSN efforts in cooperation with various federal, state, and local law enforcement officials.
Paterson Police Sergeant Charged with Conspiracy to Violate Civil Rights and Filing False Police ReportRead the Press Release
NEWARK, N.J. – A federal grand jury today charged a sergeant with the Paterson Police Department with conspiring with other officers to violate individuals’ civil rights, and submitting a false police report to conceal their illegal activity, U.S. Attorney Craig Carpenito announced.
Sergeant Michael Cheff, 49, of Paterson, New Jersey, was charged in a two-count indictment with conspiring to deprive individuals of civil rights under color of law and with falsifying a police report. Cheff was previously charged by criminal complaint in January 2020. He will be arraigned in federal court on a date to be determined.
According to documents filed in this and other cases, and statements made in court:
Eudy Ramos, Daniel Pent, Jonathan Bustios, Matthew Torres, and Frank Toledo were police officers with the Paterson Police Department. Cheff supervised their activities and approved their reports and other paperwork related to arrests and seizures of money, narcotics, and firearms. Ramos, Pent, Bustios, Torres, and Toledo, while on official duty, violated the civil rights of individuals in Paterson. They stopped and searched motor vehicles without any justification and stole cash and other items from the occupants. They also illegally stopped and searched individuals in buildings or on the streets of Paterson and seized cash from them. They concealed their activities by submitting to Cheff false reports that omitted, or lied about, their illegal activities. Cheff signed off on those false police reports, and routinely received a portion of these stolen monies from some of these officers. In 2016, Cheff told one of the officers to start “tagging,” or logging into evidence, some of the money that the officer was stealing, because effecting narcotics arrests without logging money into evidence would otherwise raise questions.
On Nov. 14, 2017, Cheff joined Bustios, Ramos, and Torres in stealing cash from an apartment in Paterson. Bustios, Ramos, and Torres stopped and arrested an individual in Paterson. Bustios stole a few hundred dollars from the individual during the arrest, then the officers went to the individual’s apartment, and were joined by Cheff. Torres stayed behind to guard the arrested individual, who was handcuffed in a police car, while Cheff, Ramos, and Bustios obtained consent to search the apartment by lying to the individual’s mother.
Cheff, Ramos, and Bustios then searched the individual’s room. Cheff located a safe inside a closet in the room and took money and narcotics from the safe. He handed a small portion of the money to Bustios and told Bustios to log it into evidence. Cheff put the rest of the money in his pocket. After the search, in a bathroom at the Paterson police station, Cheff gave Torres and Ramos a portion of the stolen money. Cheff also approved a police report that falsely stated that the officers had recovered $319 from on top of a shelf in the individual’s room.
Later that day, Bustios and Toledo exchanged text messages discussing Cheff’s theft of money. Bustios said, among other things, that Cheff “got us for over a stack today,” that “there was a safe” and that Cheff “grabbed the cash.” According to the individual whose apartment was searched, the safe contained approximately $2,700, and all of it was missing after the search was completed.
The conspiracy to violate civil rights charge carries a maximum penalty of 10 years in prison. The false records charge carries a maximum penalty of 20 years in prison. The maximum fine for each count is $250,000.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation leading to today’s indictment. He also thanked the Passaic County Prosecutor’s Office, under the direction of Prosecutor Camelia M. Valdes, the Paterson Police Department, under the direction of Paterson Police Director Jerry Speziale and Paterson Police Chief Ibrahim “Mike” Baycora, and the Paterson Police Department Office of Internal Affairs for their assistance in the investigation.
The government is represented by Assistant U.S. Attorney Rahul Agarwal, Deputy Chief of the Criminal Division, and Assistant U.S. Attorney Lee M. Cortes Jr., Chief of the Health Care Fraud Unit.
The charges and allegations contained in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Defense counsel: John Lynch Esq., Union City
Pair Charged with Dealing in Firearms Without A License, at Least 48 Firearms Purchased, Some Seized at US/Mexico BorderRead the Press Release
SALT LAKE CITY – Norma Llamas Rodriguez, age 46, of Moreno Valley, California, and her son, Carlos Arturo Garcia, age 21, of West Valley City, are charged with firearms trafficking in a seven-count federal indictment unsealed Monday afternoon.
According to the indictment, from about June 10, 2017, and continuing until at least Feb. 12, 2019, Llamas Rodriguez and Garcia purchased at least 48 firearms in transactions conducted through FFLs. The indictment alleges that at no time did either defendant possess a Federal Firearms License (FFL) required to be lawfully engaged in the business of dealing in firearms.
Seven of the firearms Llamas Rodriguez and Garcia purchased were FN M249S rifles, which are semi-automatic belt-fed tripod mount rifles. Llamas Rodriguez and Garcia purchased the rifles from FFLs between Nov. 20, 2018, and Feb. 12, 2019 for approximately $7,485-$7,895 using U.S. Postal money orders. During the same period, the indictment alleges the pair transferred firearms to others without conducting lawful transfers through FFLs.
ATF special agents in Utah launched an investigation in February 2019 after receiving information from an FFL concerned about a suspicious purchase. The FFL reported that they had listed an FN Model M249S belt-fed rifle for sale for $7,900. A buyer in Utah attempted to purchase the firearm. According to a complaint in the case, the FFL was concerned that it might be a scam so he reviewed additional information and noticed that the Utah purchaser had used the account to purchase two other FN M249S rifles within the past month. The FFL contacted the sellers of the other rifles and they did not report any issues. After the FFL received a U.S. Postal money order for the firearm, Llamas Rodriguez reached out to him and requested a refund for the firearm. The FFL reported Llamas was “spooked” and wanted her money back. The FFL started researching Llamas Rodriguez on the internet and then contacted the ATF after he became suspicious with her purchase of $24,000 worth of firearms in such a short period of time, according to the complaint.
The complaint alleges that ATF continued to investigate the two FN M249S rifles Llamas Rodriguez purchased and learned that the firearms were shipped to FFLs in Salt Lake City and Murray where Llamas Rodriguez and Garcia picked them up. They also found that between October 2017 and December 2018, Llamas had purchased an additional 22 AR-15 type rifles and four handguns from one of the FFLs.
ATF served a search warrant at two mobile homes in South Salt Lake City on Feb. 14, 2019. Agents found three firearms, documentation showing wire transfers to/from Mexico, multiple firearm operator manuals, and $7,400 in cash. Llamas Rodriguez was not at the residence. Garcia was there and, according to the complaint, told agents Llamas Rodriguez was buying the firearms for Hispanic males in California and was on her way to California with one of the FN M249S rifles.
During the investigation, ATF agents learned on March 3, 2018, six AR-15 firearms were seized at the Nogales Port of Entry on a bus entering Mexico from the United States. Four of those firearms were traced to Llamas Rodriguez. Records show Llamas Rodriquez purchased the firearms just two days prior on March 1, 2018. Agents traced two others to purchases she made on Feb. 22, 2018.
The indictment charges the pair with one count of dealing in firearms without a license. Llamas Rodriguez is also charged with four counts of false statements in the acquisition of a firearm and Garcia is charged with two counts of making a false statement in the acquisition of a firearm. The maximum potential penalty for dealing in firearms without a license is five years in prison. Each of the false statements in the acquisition of a firearm counts has a potential sentence of 10 years in prison.
Llamas Rodriguez was arrested on the complaint in California and had an initial appearance in federal court in California. She was released on conditions, including a $100,000 bond. She had an initial appearance in Salt Lake City Monday afternoon where she entered a plea of not guilty to the charges. She continues on the conditions of release set in California. Llamas Rodriguez is in the country on a green card. She is a former resident of West Valley City.
Garcia, a U.S. citizen, was taken into custody when he came to the federal courthouse Monday afternoon. He had an initial appearance Tuesday and entered a not guilty plea to the charges. He was released on conditions of supervised release.
Nitro Woman Pleads Guilty to Theft of Social Security Income BenefitsRead the Press Release
Defendant fraudulently obtained over $74,000
HUNTINGTON, W.Va. – A Nitro, West Virginia woman entered a guilty plea to the felony offense of fraudulently obtaining Social Security Income benefits, announced United States Attorney Mike Stuart. Teresa Ahrent, 56, faces up to 5 years of incarceration when she is scheduled to be sentenced on June 8, 2020. She will also be required to pay restitution back to the United States Social Security Administration. United States Attorney Mike Stuart praised the work of the United States Social Security Administration-Office of Inspector General (SSA-OIG) and the Social Security Administration (SSA).
“Social security and government benefit fraud is rampant and epidemic. Stealing government benefits is an abhorrent repugnant act,” said United States Attorney Mike Stuart. “The bottom line is this- steal social security or any other government benefit and we will prosecute you to the fullest extent of the law. If we catch you ripping off the system and the taxpayers, we will hold you accountable. No excuse is acceptable. We are working closely with the Social Security Administration to identify fraudsters and hold them accountable.”
Ahrent applied for Title XVI Social Security benefits in January 2005 as a representative payee on behalf of her adult daughter. These Social Security benefits are based on income and living arrangements, and create a duty on the representative payee to report a change in income or living arrangements. In 2005, Ahrent indicated that her daughter resided with her in her (then) home in Hurricane, Putnam County, West Virginia. In 2010, Ahrent’s adult daughter was removed from Ahrent’s home and began to live in Mildred Mitchell-Bateman psychiatric hospital in Huntington, where Ahrent’s daughter resided for nine years. Every year, Ahrent represented to the SSA that her adult daughter resided in Ahrent’s home in Hurricane, when in fact her daughter was living full time at the Bateman hospital and Ahrent had moved to Nitro, Kanawha County, West Virginia. In 2019, the Social Security Administration learned of the fraud and referred the case to the Office of Inspector General. On April 30, 2019, Ahrent gave a detailed statement to federal investigator with the Office of Inspector General and a representative with the Social Security Administration admitting that her daughter did not reside in her home and that she was receiving money that she was not entitled to receive. From June 2010 through May 2019, Ahrent received $74,641 in Social Security benefits in excess of the amount she was due.
United States District Judge Robert C. Chambers presided over the hearing. Assistant United States Attorneys Erik S. Goes and Julie White handled the prosecution.
Follow us on Twitter: @SDWVNews and @USAttyStuart
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Niagara Falls Man Pleads Guilty for His Role in Drug ConspiracyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Wayne Payne, 63 of Niagara Falls, NY, pleaded guilty before U.S. District Judge Lawrence J. Vilardo to conspiring to possess with intent to distribute 500 grams or more of cocaine. The charge carries a mandatory minimum penalty of five years in prison, a maximum penalty of 40 years, and a fine of $5,000,000.
Assistant U.S. Attorney Laura A. Higgins, who is handling the case, stated that between May 2017 and November 2017, the defendant conspired with Lavon Parks and others to sell cocaine in the Niagara Falls and Buffalo, NY areas. Specifically, Payne drove Parks to meet with other individuals to perform drug transactions and to collect drug proceeds from lower-level distributors who worked for Parks. Defendant also drove Parks to meet with out-of-state suppliers, who provided bulk quantities of cocaine which would be transported back to Niagara Falls for distribution.
On November 30, 2017, during a trip to Houston, Texas, the defendant, Parks, and Parks’ father, James Parks, were stopped for several traffic infractions. A subsequent consensual search of the rental vehicle revealed four packages of cocaine wrapped with plastic and duct tape concealed in the spare tire area.
Lavon and James Parks are currently charged in federal court with narcotics conspiracy and discharge of firearm causing death involving the murder of Kevin Turner. The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
The plea is the result of an investigation by the Niagara Falls Police Department, under the direction of Superintendent Thomas Licata; the Drug Enforcement Administration, under the direction of Special Agent-in-Charge Ray Donovan, New York Field Division; the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Gary Loeffert; the Bureau of Alcohol, Tobacco, Firearms and Explosives, under the direction of Special Agent-in-Charge John B. Devito, New York Field Division; the U.S. Postal Inspection Service, under the direction of Inspector-in-Charge Joseph W. Cronin of the Boston Division; and the Lackawanna Police Department, under the direction of Chief James Michel.
Sentencing is scheduled for July 17, 2020, at 1:00 p.m. before Judge Vilardo.
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Morgan County man admits to crossing state lines to have sex with a minorRead the Press Release
MARTINSBURG, WEST VIRGINIA – Elmer Leroy Kerns, of Paw Paw, West Virginia, has admitted to a sex charge, U.S. Attorney Bill Powell announced.
Kerns, age 44, pled guilty to one count of “Interstate Travel for Sex with a Minor.” Kerns admitted to traveling across state lines to engage in sexual activity with a person under the age of 18. The crime took place in July 2019 in the Northern District of West Virginia and elsewhere.
Kerns faces up to 30 years incarceration and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Kimberley D. Crockett is prosecuting the case on behalf of the government. The West Virginia State Police investigated.
U.S. Magistrate Judge Robert W. Trumble presided.Montgomery County Attorney Sentenced to Five Years in Prison for Stealing from His Former Law FirmRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that Craig A. Cohen, 55, of Blue Bell, PA was sentenced to 60 months’ imprisonment, three years’ supervised release and ordered to pay over $3.4 million in restitution by United States District Court Eduardo C. Robreno for his scheme to steal money from various entities through his work as an attorney.
The defendant pleaded guilty to mail fraud in November 2019. For approximately eight years, Cohen worked for a Philadelphia-based law firm. He specialized in representing insurance companies in subrogation matters, particularly those matters involving losses generated by water damage. As a subrogation attorney, Cohen filed claims on behalf of insurance companies to obtain recoveries against product manufacturers and class action settlement funds after the insurance companies covered losses of insured individuals due to water damage resulting from defective products.
Over the course of approximately four years, from 2015 through 2019, Cohen engaged in a fraudulent scheme to obtain millions of dollars in financial recoveries from product manufacturers and class action settlement funds. He committed this fraud by filing fraudulent subrogation claims that illegally funneled the financial recoveries directly to him.
Cohen operated the scheme primarily from his home in Blue Bell where he created a legal entity, WLSP, PLLC (“WLSP”), which he used to file the fabricated claims. He also opened a post office box in Philadelphia and created internet domains and email addresses for his company so that his fraudulent business could function effectively and appear legitimate.
In total, Cohen submitted dozens of fraudulent claims, causing losses to numerous victims, including product manufacturers, class action settlement funds, insurance companies, and his employer, for a total loss of over $3.4 million.
“Attorneys take an oath to uphold the law and to act in the best interest of their clients – not to use their position to steal,” said U.S. Attorney McSwain. “Mr. Cohen went to great lengths to deceive and defraud his employer, its clients, and other entities of millions of dollars. This is illegal conduct for an employee in any line of work, but it is especially reprehensible for a lawyer.”
“Cohen’s elaborate fraud scheme spanned several years, during which he stole more than $3.4 million of his victims’ money,” said Tara A. McMahon, Acting Special Agent in Charge of the FBI’s Philadelphia Division. “He lied to his employer and clients, fabricated supporting evidence, and cashed in on bogus claims. The FBI is committed to bringing such egregious financial crimes to light and the perpetrators to justice.”
The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Deputy United States Attorney Louis D. Lappen.
Misdemeanor Count Against Scott Warren DismissedRead the Press Release
Yesterday, the United States Attorney’s Office filed a motion to dismiss the remaining misdemeanor count against Scott Warren, for which he was found guilty. Senior District Judge Raner Collins granted the motion in court this morning. The dismissal is only as to the specific offense in Count 1 of the information. Dismissing the remaining count of conviction in this case does not foreclose the United States from prosecuting Warren for other crimes in the Cabeza Prieta National Wildlife Refuge, should he violate the law.
“While we continue to evaluate appellate options after an adverse ruling in a similar case, we want to ensure consistency in our prosecution of these violations moving forward,” said United States Attorney Michael Bailey. “But to be clear, these groups must follow the law, even when delivering true humanitarian aid, and we will continue to prosecute those who intentionally help illegal immigrants evade law enforcement detection while deceptively cloaking their illegal acts as ‘humanitarian aid.’”
Meyersdale Woman Sentenced for Defrauding Social SecurityRead the Press Release
JOHNSTOWN, Pa. – A resident of Meyersdale, Pa. has been sentenced in federal court in Johnstown to one day of imprisonment, three years’ supervised release, including one year of home confinement, and restitution in the amount of $251,000 to the Social Security Administration on her conviction of conversion of government funds, United States Attorney Scott W. Brady announced today.
United States District Judge Kim R. Gibson imposed the sentence on Donalee Harvey, 73, of Meyersdale, Pa.
According to information presented to the court, from Dec. 3, 1997, to March 2, 2018, Harvey did receive and convert falsely to her own use a total of $164,862, which represents approximately 236 separate Social Security Administration benefit payments made to another person, to which she was not entitled.
Assistant United States Attorney Arnold P. Bernard, Jr. prosecuted this case on behalf of the government.
Mr. Brady commended the Social Security Administration, Office of Inspector General for the investigation that led to the successful prosecution of Harvey.
Mexican National Illegally Entered the United States Six Times, Sentenced for Drug-Trafficking, Illegal FirearmRead the Press Release
KANSAS CITY, Mo. – A Mexican national in Kansas City, Missouri, has been sentenced in federal court for his role in a conspiracy to distribute marijuana, illegally possessing a firearm, and illegally entering the United States for the sixth time.
Uriel L. Martinez, 24, was sentenced by U.S. District Judge Stephen R. Bough on Wednesday, Feb. 26, to six years in federal prison without parole.
Co-defendant Omar A. Bustillos, 34, of Kansas City, Missouri, pleaded guilty to his role in the drug-trafficking conspiracy on Tuesday, Feb. 25. Bustillos admitted he was responsible for distributing or possessing at least 1.966 kilograms of heroin, 2.6 kilograms of methamphetamine, and 4.8 kilograms of marijuana.
On Oct. 21, 2019, Martinez pleaded guilty to conspiracy to distribute marijuana, possessing firearms in furtherance of a drug-trafficking crime, and illegally reentering the United States.
Martinez had previously been deported from the United States on five separate occasions between April 12, 2015, and April 19, 2018.
According to court documents, Martinez’s role in the drug-trafficking conspiracy was limited to marijuana. Martinez was responsible for distributing or possessing at least 50 kilograms of marijuana. Both Martinez and Bustillos admitted that $64,600 seized by law enforcement was proceeds from the sale of illegal drugs.
According to court documents, Martinez was arrested in California in 2017 when law enforcement officers found 98 large marijuana plants (approximately six to eight feet in height and four to five feet in width) on the property where he had been living. The total weight of the plants was 5,100 pounds. Martinez failed to appear in court and those charges are still pending.
Detectives with the Kansas City, Missouri, Police Department executed a search warrant on the residence of co-defendant Nathan R. Carpenter, 28, of Kansas City, Missouri, on Jan. 8, 2019, and seized nearly a kilogram of heroin, more than 1.2 kilograms of marijuana, 86.19 grams of methamphetamine, a stolen Romarm 7.62x39 caliber, AK-style rifle, a Taurus .22-caliber handgun and a Remington .22-caliber semi-automatic rifle. Carpenter told investigators he was holding the approximately two pounds of heroin for Bustillos and his girlfriend, co-defendant Tonya Marie Thomas, 34, of Kansas City, Missouri, who were Carpenter’s suppliers for narcotics.
On Jan. 15, 2019, detectives executed a search warrant at the residence of Thomas and Martinez (where Bustillos also resided before his arrest on unrelated state charges). They seized more than a kilogram of heroin, 605.81 grams of methamphetamine, more than 4.7 kilograms of marijuana, 31 acetaminophen/hydrocodone pills, a Smith and Wesson .40-caliber handgun, a Stoeger 9mm handgun, an SCCY 9mm handgun, $20,283, and two drug ledgers. Officers also found $44,317 in Thomas’s vehicle, along with approximately 73.26 grams of marijuana. Thomas told detectives she had been selling methamphetamine since Bustillos was arrested, and estimated selling a quarter pound of methamphetamine every day during the previous two weeks.
Martinez, Carpenter, Bustillos and Thomas are among six defendants who have pleaded guilty in this case. Martinez is the first defendant to be sentenced.
This case is being prosecuted by Assistant U.S. Attorney Brad K. Kavanaugh. It was investigated by the Kansas City, Mo., Police Department.