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19 December 2019
Eleven people indicted for their roles in a bookmaking and money laundering conspiracyRead the Press Release
Eleven people were indicted in federal court for their roles in a conspiracy to operate an illegal gambling business and a conspiracy to launder monetary instruments.
Stephen Bellipario, aka Tony, 36, of Long Island, New York; Joseph Fowles, aka Matt, 36, of Seaford, New York; Amir Hugh Robinson, 47, of Sunny Isles Beach, Florida; Anthony Pinialis, 64 of Las Vegas, Nevada; Clinton Reider, 41, of Mentor on the Lake; Thomas Reed, 48 of Kirtland Hills, James Ovens, 50 of Willoughby; Michael Tutolo, 53 of Mentor; Maurey Presser, 61 of South Euclid; Alan Bambic, 44 of Painesville; and Ralph Robertson 57 of Chagrin Falls are all charged with conspiracy to operate an illegal gambling business and operating an illegal gambling business. Bellipario, Fowles, Robinson, Pinialis, Ovens, and Tutolo are also charged with conspiracy to launder monetary instruments.
“Identifying fraudulent schemes, including alleged gambling and money laundering enterprises, remains a priority of the Department of Justice and this U.S. Attorney’s Office,” said U.S. Attorney Justin Herdman. “Our partner agencies share in this commitment, which is certainly reflected in the work performed by the Internal Revenue Service and the United States Secret Service that led to these charges.”
“One of the U.S. Secret Service’s priorities is to safeguard the country’s financial system,” stated Jonathan Schuck, Special Agent in Charge of the U.S. Secret Service, Cleveland Field Office. “The U.S. Secret Service, IRS and United States Attorney’s Office were able to successfully collaborate to identify a large complex money laundering scheme that reaches not only domestically but internationally as well.”
“IRS Criminal Investigation is committed to unraveling complex financial transactions and money laundering schemes where individuals attempt to conceal the true source of their money," stated Bryant Jackson, Special Agent in Charge of IRS-Criminal Investigations’ Cincinnati Field Office. “Working collaboratively with the U.S. Secret Service and U.S. Attorney’s Office, IRS-CI will continue our efforts to ensure all those who participated in these schemes are brought to justice.”
The indictment alleges that the conspiracy was made up of bookmakers, more commonly known as bookies, operators of a bookmaking website, and money launderers. Bellipario and Fowles allegedly operated PremierPerHead.com (“PPH”), a gambling website based in Costa Rica. PPH allowed bookmakers to pay a weekly fee per active client account, known as a “pay per head” fee, and provided bookmakers in the Northern District of Ohio and elsewhere with access to an online gambling platform that their clients could use to place and track bets. Specifically, PPH is alleged to have allowed gambling clients to make bets on sporting events and other wagers via the website or by phone. PPH also allegedly tracked clients’ winnings and losses and maintained a dollar balance of the bookmakers’ client accounts.
The indictment alleges that Reider, Ovens, Tutolo, Reed, Presser, Bambic, and Robertson, along with others, operated as bookmakers in the Northern District of Ohio, Eastern Division and utilized the PPH website. The indictment further alleges that the pay per head fees were paid to the PPH website through a variety of payment methods, including money orders, prepaid gift cards, MoneyGram, Western Union, PayPal, Bitcoin and cash payments.
According to the indictment, Robinson and Pinialis assisted in the laundering of proceeds from PPH. Pinialis allegedly collected money orders sent to an address in Las Vegas, Nevada by bookmakers for payment of PPH fees and deposited the money orders into a bank account in his name. Robinson allegedly processed prepaid gift cards sent by bookmakers as payment for PPH fees, which resulted in deposits into his business bank account. Robinson later converted the deposits into Bitcoin in order to transfer the funds to the operators of the PPH website.
The indictment also alleges numerous payments of thousands of dollars from the bookmakers to the operators of PPH. Additionally, the indictment alleges that thousands of dollars of cash was seized from the homes of some of the bookmakers.
An indictment is only a charge and is not evidence of guilt. Defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
If convicted, the defendants’ sentences will be determined by the Court after reviewing factors unique to this case, including the defendants’ prior criminal records, if any, the defendants’ roles in the offense and the characteristics of the violations. In all cases the sentences will not exceed the statutory maximum and in most cases sentences will be less than the maximum.
This case was investigated by the United States Secret Service and the Internal Revenue Service Criminal Investigations. It is being prosecuted by Assistant U.S. Attorneys Carmen Henderson and Alejandro Abreu and Criminal Division Chief Robert Bulford.
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Eagle Butte Man Sentenced for Assault and Brandishing a Firearm During a Crime of ViolenceRead the Press Release
United States Attorney Ron Parsons announced that an Eagle Butte, South Dakota, man convicted of Assault with a Dangerous Weapon and Brandishing a Firearm during and in Relation to a Crime of Violence was sentenced on December 16, 2019, by U.S. District Judge Roberto A. Lange.
William Hawk, Sr., age 31, was sentenced to 8 years in federal prison, followed by 3 years of supervised release, forfeiture of 2 rifles, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Hawk was indicted by a federal grand jury on May 14, 2019. He pled guilty on September 25, 2019.
The conviction stemmed from an incident on May 11, 2019, when Hawk entered a motel in Eagle Butte, with a rifle in his hands and another swung on his back. Hawk spoke to the night clerk and demanded a key to a certain individual’s room. At that time, the individual Hawk was referring to walked into the lobby and Hawk instructed him to walk outside to speak with him. When the individual refused to do so unless he put the gun down, Hawk told the individual that if he did not go outside with Hawk, the individual would be executed in the lobby. At that point, the rifle discharged, and the round struck the door to the registration office. After the shot was fired, the individual ran out of the motel into the parking lot. Hawk pursued him into the parking lot, and fired a shot in the individual’s direction. The bullet struck a parked vehicle. The individual ran to a nearby residence and called 911.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
This case was investigated by the Federal Bureau of Investigation and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. Assistant U.S. Attorney Jay Miller prosecuted the case.
Hawk was immediately turned over to the custody of the U.S. Marshals Service.
Dupree Woman Charged with Assault with a Dangerous Weapon and Child AbuseRead the Press Release
United States Attorney Ron Parsons announced that a Dupree, South Dakota, woman has been indicted by a federal grand jury for Assault with a Dangerous Weapon and Child Abuse.
Cache Hebb, age 23, was indicted on December 10, 2019. She appeared before U.S. Magistrate Judge Mark A. Moreno on December 16, 2019, and pled not guilty to the Indictment.
The maximum penalty upon conviction is 15 years in federal prison and/or a $250,000 fine, 3 years of supervised release, and $200 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on or about March 8, 2019, Hebb assaulted a minor child, who was under the age of seven, with a dangerous weapon, a hairbrush, and did abuse, expose, torture, torment, and cruelly punish the minor child.
The charges are merely accusations and Hebb is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Cheyenne River Sioux Tribe Law Enforcement Services and the Federal Bureau of Investigation. Assistant U.S. Attorney Cameron J. Cook is prosecuting the case.
Hebb was released on bond pending trial. A trial date has not been set.
Domestic violence offenders plead guiltyRead the Press Release
HONOLULU, Hawaii – U.S. Attorney Kenji M. Price for the District of Hawaii announced two important guilty pleas:
-David Benjamin Cordeiro, 37, of Mountain View, Hawaii, pleaded guilty today in federal court to one count of possessing ammunition after having been previously convicted of misdemeanor domestic violence under Hawaii State law, in violation of 18 U.S.C. § 922(g)(9). Sentencing is scheduled for April 22, 2020 before U.S. District Judge Leslie E. Kobayashi. According to court documents and information presented in court, on September 1, 2018, Cordeiro possessed multiple rounds of ammunition, which he fired into a stopped car that an adult female was driving, while she was in the driver’s seat. Cordeiro had previously been convicted of domestic violence against an intimate partner, in violation of Hawaii Revised Statutes § 709-906 (Abuse of Family or Household Members). In light of his prior domestic violence conviction, federal law prohibited Cordeiro from possessing firearms or ammunition.
-Austin Borja-Haumea, 24, of Kekaha, Hawaii, pleaded guilty today in federal court to one count of possessing a firearm while being subject to an active Order for Protection, in violation of 18 U.S.C. § 922(g)(8). Sentencing is scheduled for April 15, 2020 before U.S. District Judge Leslie E. Kobayashi. According to court documents and information presented in court, on February 18, 2018, Borja-Haumea possessed an unloaded shotgun while seated in a car on Kaua’i. Borja-Haumea was prohibited from possessing a firearm because he was subject to an Order for Protection that had been filed by a family member due to domestic violence.
“These prosecutions are examples of the federal law enforcement community holding individuals accountable for possessing firearms and ammunition, when federal law expressly prohibits them from doing so. Law enforcement officials will continue to protect our communities by sending a strong enforcement message to prior offenders who have no business possessing a firearm or ammunition.”
The case against Cordeiro was investigated by the Hawaii County Police Department and the Federal Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). It was prosecuted by Assistant U.S. Attorney Morgan Early.
The case against Borja-Haumea was investigated by the Kaua’i County Police Department and ATF. It was prosecuted by Assistant U.S. Attorney Sean Van Demark.
These prosecutions are part of Project Safe Neighborhoods (PSN), a program that brings together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of its renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
Doctor, Pharmacists, and Marketers in Compounding Pharmacy Kickback Conspiracy SentencedRead the Press Release
Tampa, Florida – Two pharmacists, a physician, and two marketers have been sentenced for conspiring to pay and receive health care kickbacks for prescriptions for compounded creams billed to TRICARE.
On December 17, 2019, U.S. District Judge Mary S. Scriven sentenced Dr. Anthony Baldizzi (56, Treasure Island) to one year and a day in federal prison for his role in the conspiracy. Baldizzi was ordered to forfeit $100,000, including a BMW that he had received as a kickback. On March 7, 2018, Baldizzi had pleaded guilty to conspiracy to commit healthcare fraud and receive kickbacks, and one count of receiving healthcare kickbacks. He will be surrendering his license to practice medicine in January 2020.
On October 18, 2019, U.S. District Judge Elizabeth A. Kovachevich sentenced pharmacist Carlos Mazariegos (42, Palm Harbor) to one year and a day in federal prison for his role in the conspiracy. On April 10, 2017, Mazariegos had pleaded guilty to conspiracy to commit health care fraud. He is no longer a licensed pharmacist.
On November 6, 2019, U.S. District Judge Susan C. Bucklew sentenced pharmacist Benjamin Nundy (42, Ruskin) to a five-year term of probation for his role in the conspiracy. On July 13, 2017, Nundy had pleaded guilty to conspiracy to commit health care fraud. He is no longer a licensed pharmacist.
Mazariegos and Nundy paid $6,404,793.24 in restitution to the United States and forfeited $6,404,793.24 in cash.
On December 18, 2019, U.S. District Judge Mary S. Scriven sentenced the owners of the marketing firm Centurion Compounding, Inc., Frank V. Monte and Kimberley S. Anderson, to 24 months and 18 months in federal prison, respectively. Monte and Anderson also forfeited more than $3 million in property and luxury vehicles, including a Lamborghini, a Porsche, a Ferrari, a Ford GT racing car, a McLaren, and a Mercedes.
According to court documents, in 2014 and 2015, Centurion, a marketing firm located in Pasco County, was operated by Monte and Anderson. Centurion employed sales representatives to market compounded prescription medications—specifically, creams for pain and scars—to beneficiaries of healthcare plans, especially TRICARE. These creams typically ranged in price from $900 to $21,000 for a one-month supply. Centurion representatives marketed the creams to individuals living and working at MacDill Air Force Base in Tampa.
In May 2014, Centurion entered into an exclusive, illegal kickback arrangement with Pinellas County-based LifeCare pharmacy, whereby Centurion and LifeCare agreed to share equally in the profits from the claims paid by health benefit programs, including TRICARE, for compounded medications prescribed to beneficiaries. Baldizzi agreed with Monte, Anderson, and the owners of LifeCare pharmacy (Mazariegos and Nundy), that, in exchange for kickbacks, he would write prescriptions for compounded creams marketed by Centurion to TRICARE beneficiaries. Between May and November 2014, LifeCare billed health insurers, including TRICARE, more than $12.4 million for compounded cream prescriptions written by Baldizzi and marketed by Centurion. LifeCare realized a profit of more than $10 million, which it shared with Baldizzi, Monte, and Anderson.
Even after LifeCare closed and Baldizzi withdrew from the conspiracy, Centurion transferred the existing refills from Baldizzi’s prescriptions to a new pharmacy, which filled the prescriptions and billed TRICARE. In all, Centurion caused TRICARE to be billed more than $50 million for compounded creams prescribed to patients that it had recruited. Following the execution of a federal search warrant in February 2015, Centurion ceased operations, and the United States facilitated the repayment or reversal of more than $48 million in claims to TRICARE.
This case was investigated by the Federal Bureau of Investigation, the U.S. Department of Health and Human Services Office of the Inspector General, the Defense Criminal Investigation Service, and the U.S. Air Force Office of Special Investigations, with assistance from the U.S. Army Criminal Investigation Command, the Naval Criminal Investigative Service, and the Drug Enforcement Administration. It was prosecuted by Assistant United States Attorneys Mandy Riedel and Colin McDonell, with assistance from Assistant United States Attorneys Suzanne Nebesky and Holly Gershow.
Distribution of child pornography sends Gallatin County man to prison for more than 19 yearsRead the Press Release
MISSOULA—A Gallatin County man who admitted distributing child pornography using his smartphone was sentenced today to 19 years and seven months in prison and 15 years of supervised release, U.S. Attorney Kurt Alme said.
In addition, Chief U.S. District Judge Dana L. Christensen ordered Aaron Matthew Manning, 30, to pay $18,000 restitution and to forfeit his smartphone.
Manning pleaded guilty in September to distribution of child pornography.
The prosecution said in court records that the Bozeman Police Department and the Gallatin County Sheriff’s Office were investigating Manning in 2016 for sexually assaulting a 12-year-old child he had met online. During the investigation, law enforcement obtained search warrants for Manning’s smartphone and his Dropbox account, a cloud-based file storage service. Investigators determined that Manning used an application known as KIK on his smartphone to trade child pornography with other KIK users and that in December 2015, Manning sent an image of a prepubescent child engaged in sexually explicit conduct to another KIK user. Manning also communicated with another KIK user and sent the user a link to his Dropbox account, which investigators determined contained images and videos of child pornography.
Assistant U.S. Attorney Cyndee Peterson prosecuted the case, which was investigated by the Bozeman Police Department, the Gallatin County Sheriff’s Office and the Internet Crimes Against Children Task Force.
This case was initiated under the Department of Justice’s Project Safe Childhood initiative, which was launched in 2006 to combat the proliferation of technology-facilitated crimes involving the sexual exploitation of children. Through a network of federal, state and local law enforcement agencies and advocacy organizations, Project Safe Childhood attempts to protect children by investigating and prosecuting offenders involved in child sexual exploitation. It is implemented through partnerships including the Montana Internet Crimes Against Children Task Force. The ICAC Task Force Program was created to assist state and local law enforcement agencies by enhancing their investigative response to technology facilitated crimes against children.
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Department of Justice, United States Patent and Trademark Office, and National Institute of Standards and Technology Announce Joint Policy Statement on Remedies for Standard-Essential PatentsRead the Press Release
Today the Justice Department, U.S. Patent and Trademark Office (USPTO), and National Institute of Standards and Technology (NIST) issued a joint policy Statement regarding the treatment of standard-essential patents (SEP) where the patent holder has agreed to license its patents on fair, reasonable, and non-discriminatory (F/RAND) terms. This Statement replaces the 2013 policy statement on SEP remedies issued jointly by the Department of Justice and USPTO.
“Consistent with Article I, Section 8 of the U.S. Constitution, our patent system rewards inventors with an exclusive right to practice their inventions for a limited time,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division. “Today’s Policy Statement recognizes that when licensing negotiations fail, appropriate remedies for patent infringement, including injunctive relief, should be available to SEP holders. The availability of the full range of remedies is necessary in order to preserve competition and incentives for innovation, and for continued participation in standards-setting activities, which can produce substantial benefits for American consumers.”
To this end, the Statement clarifies that a patent owner’s promise to license a patent on F/RAND terms is not a bar to obtaining any particular remedy, including injunctive relief. The agencies make clear that no “special set of legal rules” apply to SEPs, and the courts, the U.S. International Trade Commission, and other decision makers are able to assess appropriate remedies based on current law and relevant facts. According to the Statement, “The particular F/RAND commitment made by a patent owner, the [standard development organization’s] intellectual property policies, and the individual circumstances of licensing negotiations between patent owners and implementers all may be relevant in determining remedies for infringing a standards-essential patent, depending on the circumstances of each case.”
The Statement follows the Justice Department’s withdrawal from the 2013 SEP policy statement, which had been construed incorrectly as suggesting that special remedies applied to SEPs and that seeking an injunction or exclusion order could potentially harm competition.
“Our patent system is what has made the American economy the innovation capital of the world, and we should not misapply the antitrust laws to diminish the incentive to innovate,” said Assistant Attorney General Delrahim.
Since that announcement, many industry participants and policymakers have provided input to the agencies as they prepared the new Statement.
“We value the input provided across the industry and policy spectrum as the agencies drafted a new Statement, in particular the input from Senate Intellectual Property Committee Chairman Thom Tillis and Ranking Member Chris Coons,” said Assistant Attorney General Delrahim. “As the new Statement emphasizes, ultimately, there is no special set of remedies for standard-essential patents. All patent owners have a statutory right to seek injunctive relief, and this joint statement reaffirms that if they do so the agencies will not put a thumb on the scale against them.”
Department of Justice Awards over $800,000 to the City of Aurora for Body Worn CamerasRead the Press Release
DENVER – United States Attorney Jason R. Dunn and the Department of Justice’s Office of Justice Programs announced that the Department of Justice has awarded funding of more than over $62 million to provide services designed to protect officers and improve overall public safety. OJP’s Bureau of Justice Assistance and National Institute of Justice awarded grants to law enforcement departments, local jurisdictions, and training, technical assistance and research organizations throughout the United States.
During this round of funding, the City of Aurora received $852,580 for the Department’s body worn cameras. In total, BJA awarded nearly $20.53 million to 82 law enforcement agencies under its Body- Worn Camera Policy and Implementation Program. Funding will enable grantees to improve their capacity to gather evidence and protect the safety of law enforcement officers and citizens.
“Body worn cameras are an important part of policing, both for officers and the public,” said U.S. Attorney Jason Dunn. “This grant will help make Aurora Police Department better and thus the people of Aurora safer.”
“The Office of Justice Programs stands proudly with the Attorney General and the President in our commitment to the 700,000 sworn law enforcement professionals who selflessly put their lives on the line to keep us all safe,” said OJP’s Principal Deputy Assistant Attorney General Katharine T. Sullivan. “Bulletproof vests, body-worn cameras, health and safety research—these resources will provide officers the training, equipment and strategies needed to enable them to do their jobs effectively and keep them safe from harm.”
The FBI’s official crime data for 2019 reflects a decrease in the number of law enforcement officers feloniously killed between 2018 and 2019 (43 killed through September 2018 and 32 killed as of Sept. 30, 2019). There was also a slight decrease in the number of law enforcement officers reported accidentally killed in 2019 (29) as compared to the same reporting period in 2018 (33).
Still, there were almost 60,000 assaults against officers in 2018, according to the latest data available from the FBI.
Nearly $23 million will support the training and implementation of law enforcement agencies’ body-worn camera programs. Another $21 million will reimburse jurisdictions for up to 50 percent of the cost of body armor vests, while over $14.8 million will support law enforcement safety and wellness programs, research and services.
In addition, over $3 million is allocated for research and evaluation of safety, health and wellness priorities. These investments include the development of ballistic vests, studies of in-vehicle safety and the evaluation of less-lethal technologies to increase police and public safety.
A full list of the awards, organized under specific grant programs and listed awardees by state, is available online at https://go.usa.gov/xpxd3.
Additional information about Fiscal Year 2019 grant awards made by the Office of Justice Programs can be found online at the OJP Awards Data webpage.
The Office of Justice Programs, directed by Principal Deputy Assistant Attorney General Katharine T. Sullivan, provides federal leadership, grants, training, technical assistance and other resources to improve the nation’s capacity to prevent and reduce crime, assist victims and enhance the rule of law by strengthening the criminal and juvenile justice systems. More information about OJP and its components can be found at www.ojp.gov.
Department of Justice Reaches $5.5 Million Settlement with Van Andel Research Institute to Resolve Allegations of Undisclosed Chinese Grants to Two ResearchersRead the Press Release
WASHINGTON — The Department of Justice announced today that Van Andel Research Institute (VARI) has agreed to pay $5,500,000.00 to resolve allegations that it violated the False Claims Act by submitting federal grant applications and progress reports to the National Institutes of Health (NIH) in which VARI failed to disclose Chinese government grants that funded two VARI researchers. The settlement further resolves allegations that in a Dec. 21, 2018 letter, VARI made certain factual representations to NIH with deliberate ignorance or reckless disregard for the truth regarding the Chinese grants.
Andrew Birge, U.S. Attorney for the Western District of Michigan, said, “Our local institutions, like VARI, serve a vital role in raising West Michigan’s profile as a national player in cutting-edge biomedical research, but institutions everywhere must deal honestly and transparently when applying for U.S. government funding and respond appropriately when compliance issues arise. It’s unfair to other grant applicants and to the NIH for any institution to withhold requested information about whether the research that an institution wants the NIH to support may be getting funding from outside sources, specifically including foreign governments. False Claims Act penalties are harsh by design. I sincerely hope the word gets out on the importance of full disclosure with the government.”
“It is imperative that recipients of NIH grant funds properly report all sources of research support, financial interests and affiliations of individual researchers to ensure the proper and effective use of taxpayer dollars,” said Lamont Pugh III, Special Agent in Charge of HHS-OIG’s Chicago Region. “HHS-OIG will continue to investigate allegations of failures to properly report information to ensure the integrity of Departmental programs.”
Obtaining research funding from NIH is a highly competitive process, with only a small portion of eligible applications receiving funding each year. Nondisclosures and false statements to granting agencies are especially harmful because they distort competition, disadvantage applicants who play by the rules, and undermine agencies’ decision-making on the use of their limited resources.
As part of its grants application process, NIH requires recipient institutions to disclose all financial resources—including any other research grants—that are available to researchers and other key research personnel in support of their research endeavors (known as “Other Support” disclosures). Other Support disclosures allow NIH to independently evaluate, among other things, whether research submitted for taxpayer support is being funded by another source. During the term of a grant, NIH also requires recipient institutions to disclose whether certain aspects of federally-funded research will be, or have been, performed outside of the United States (known as “Foreign Component” disclosures). Research institutions, which apply for NIH grants on behalf of researchers and groups of collaborating researchers, make these Other Support and Foreign Component disclosures on or in connection with NIH forms.
VARI is an independent research institute in Grand Rapids, Michigan. Between Jan. 1, 2012, and Aug. 31, 2019, VARI received NIH grants for two researchers, including a researcher identified here as “Professor 1.” The government alleged that in applying for the NIH grants, and in submitting claims for federal grant funds, VARI did not disclose any foreign research funding for those researchers or any foreign components of their NIH-sponsored research. The government alleged, however, that both researchers received research funding from Chinese sources while VARI was applying for and receiving NIH funds on their behalf. The government specifically alleged that between Jan. 2012 and Dec. 2018, Professor 1 received grants and research support from a variety of Chinese sources, including the People’s Republic of China’s Thousand Talents Program. The Thousand Talents Program is in place with the purpose of returning talent, research, and technology to China for China’s benefit.
The government claimed that between Jan. 2012 and June 2018, VARI should have known about these foreign grants and disclosed them to NIH. The government alleged that while VARI had institutional policies and procedures in place to address conflicts of interest, VARI did not take adequate additional steps to investigate the researchers’ foreign funding sources despite receiving specific information about their Chinese affiliations. The government claimed, for example, that a Chinese institution sent VARI a letter stating that Professor 1 was receiving “generous support” from the Chinese Thousand Talents Program. The government also alleged that VARI knew that Professor 1 held a directorship at a Shanghai-based research institute—a collaboration between VARI and the Shanghai Institute of Materia Medica—that would involve Professor 1 applying for Chinese research grants to support work at the foreign institution.
The government claimed that VARI learned about certain of Professor 1’s Chinese grants in June 2018 while reviewing a press release for one of Professor 1’s publications. The government claimed that rather than confirming and disclosing the information to the NIH, VARI removed references to those grants from the proposed funding attributions in its press release. The government alleged that shortly thereafter, VARI received an Aug. 20, 2018 letter from NIH Director Francis S. Collins, M.D., Ph.D. that reminded recipient institutions of the need to disclose “support coming from foreign governments or other foreign entities” for their researchers. The government alleged that VARI then received a Nov. 30, 2018 e-mail from NIH that cited specific concerns about potential nondisclosures relating to Professor 1. The government claimed that VARI did not disclose Professor 1’s Chinese grants to NIH even after receiving this correspondence.
The government claimed that VARI instead retained an outside consulting firm, and, relying on that firm’s advice, sent a Dec. 21, 2018 letter to NIH in which VARI stated that it was not required to disclose information about Professor 1’s foreign grants because “there was no undisclosed overlap of any budgetary resources, commitment, or scientific endeavor” between the Chinese grants and the NIH grants. NIH, however, requires disclosure of all financial resources available in support of an individual’s research endeavors. The government further alleged that VARI, in representing to the agency that “there was no undisclosed overlap” between the Chinese grants and the NIH grants, did not know whether that statement was true.
U.S. Attorney Birge added that institutions concerned about a prior statement on a grant application should know that it is Department of Justice policy that entities or individuals that make “proactive, timely, and voluntary self-disclosures to the Department about misconduct will receive credit during the resolution of a False Claims Act case.”
This case was a cooperative effort among HHS-OIG, the FBI, and the U.S. Attorney’s Office for the Western District of Michigan. Assistant U.S. Attorney Adam B. Townshend represented the United States
The claims resolved by the settlements are allegations only. There has been no determination of liability.
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Defendant Charged in Conspiracy to Transport 13 Kilos of Highly Toxic Fentanyl from Texas to New YorkRead the Press Release
Aurora Betancourt, a Canadian citizen, will be arraigned today in federal court in Brooklyn before United States Magistrate Judge Steven M. Gold on an indictment charging her with conspiring to distribute, and distribution of, fentanyl. Betancourt was arrested in Colombia on December 28, 2018, and extradited to the United States on December 18, 2019.
Richard P. Donoghue, United States Attorney for the Eastern District of New York, William F .Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), and Dermot F. Shea, Commissioner, New York City Police Department (NYPD), announced the extradition and indictment.
“As alleged in the indictment, Betancourt arranged the transportation of what she and her co-conspirators referred to as heroin, but what was in fact fentanyl, a synthetic opioid substitute even more potent than heroin,” stated United States Attorney Donoghue. “Thanks to the outstanding work by law enforcement officers, Betancourt’s alleged plan to flood our streets with this extremely dangerous drug was thwarted, and she will now face justice for her actions.” Mr. Donoghue extended his grateful appreciation to Drug Enforcement Administration Galveston, Texas office and the United States Marshals Service.
“Narcotics such as fentanyl and heroin are destroying lives and terrorizing communities across the United States, as well as here in New York. As alleged, the defendant showed a flagrant disregard for human life and public safety, by arranging with her associates to have a significant amount of fentanyl transported to New York,” stated FBI Assistant Director-in-Charge Sweeney. “Today’s arrest demonstrates the commitment of the FBI and our law enforcement partners to holding accountable anyone who would perpetuate the cycle of addiction contributing to the opioid crisis.”
“Allegedly responsible for attempting to transport 13 kilos of highly addictive fentanyl onto the streets of New York City, Betancourt will now have to answer for her actions that could have resulted in overdoses and deaths in our city,” stated HSI Special Agent-in-Charge Fitzhugh. “Fentanyl has claimed the lives of far too many Americans, and so seizures and arrests like this are an important step to help rid the streets of this deadly epidemic.”
According to court documents, at a meeting in Queens, New York, in July 2017, Betancourt conspired with others to transport narcotics from Houston, Texas, for distribution in the New York metropolitan area. The conspirators referred to the narcotics as “grasa,” a code for heroin. DEA agents seized the narcotics in Texas before they could be transported. Subsequent laboratory testing revealed that the narcotics were actually fentanyl, a highly potent synthetic opioid that can serve as a substitute for heroin and frequently results in overdoses by users. The total weight of the seizure was approximately 13 kilos, at the time the second largest seizure of fentanyl by the DEA. DEA estimated the street value of the fentanyl in New York at approximately $800,000.
If convicted of either count of the indictment, Betancourt faces a mandatory minimum of 10 years’ imprisonment and a maximum of life imprisonment.
The charges in the indictment are allegations, and the defendant is presumed innocent unless and until proven guilty.
The government’s case is being handled by the Office’s International Narcotics and Money Laundering section. Assistant United States Attorney Alicia N. Washington is in charge of the prosecution.
The Defendant:
AURORA BETANCOURT
Age: 35
CanadaE.D.N.Y. Docket No. 18-CR-623 (ARR)
Davis Man Sentenced to over 3 Years in Prison for California Driver’s License FraudRead the Press Release
SACRAMENTO, Calif. — David Sun, 65, of Davis, was sentenced today to three years and one month in prison for a scheme to fraudulently obtain California Class A and Class B commercial driver licenses (CDLs) for the students of his commercial driving school, U.S. Attorney McGregor W. Scott announced.
“He not only knowingly and willfully abused his position of trust for personal gain, but did so at the expense of others, in this document fraud scheme,” said Tatum King, special agent in charge, San Francisco, Homeland Security Investigations. “HSI will continue working with our law enforcement partners to identify and disrupt document fraud and bring to justice those involved in these illegal schemes.”
On Sept. 13, after a seven-day trial, a jury found Sun guilty of one count of conspiracy to commit unauthorized access of a computer and to produce identification documents without lawful authority, eight counts of production of identification documents without lawful authority, and one count of conspiracy to produce identification documents without lawful authority and to transfer identification documents produced without lawful authority.
According to court documents and evidence produced at trial, Sun operated a driving school named Commercial Driver Institute USA in the East Bay with a parking lot in Richmond. Sun primarily catered to Mandarin and Cantonese speaking students. He helped students get Class A or Class B commercial driver licenses that allowed them to drive large vehicles like tractor-trailer trucks and buses. Sun typically charged $2,500 to $6,500 per student.
Sun committed two different types of fraud: a testing conspiracy where Sun helped his California students fraudulently bypass the required written and/or behind the wheel driving tests to get commercial licenses, and a residency conspiracy where Sun recruited students from New York and helped them pose as California residents to get a California CDL. Sun would arrange for the licenses to be mailed to the students who had returned to their actual home state of New York.
Sun’s students struggled with the written tests because of their English language limitations so he helped them bypass the written testing requirements for learner’s permits. Those permits were issued from DMV’s Walnut Creek office under one employee’s login from at least November 2014 through January 2016. None of Sun’s students in the conspiracy or charged counts ever went to that Walnut Creek DMV office or passed the tests on the dates indicated in DMV’s records. Sun instructed his students to attempt the written tests, which they did at various DMV offices in the Bay Area. If they failed, Sun often took their DMV receipt, which would show their unique California DMV number, and a fraudulent permit would issue from the Walnut Creek DMV after fraudulent passing scores were entered under the Walnut Creek employee login.
On occasion, Sun provided his students with a Bluetooth device to wear during the driving test, and instructed them to wear a beanie to conceal it, so that Sun could tell the student what to say and do during the test. In addition, on many occasions Sun took his students to a particular licensing registration examiner at the DMV in Santa Rosa with whom Sun had a personal relationship. Evidence at trial showed that Sun was paid extra money to guarantee his students would pass the driving tests.
This case was the product of an investigation by the California Department of Motor Vehicles Office of Internal Affairs and Homeland Security Investigations. Assistant U.S. Attorneys Rosanne L. Rust and Christopher S. Hales prosecuted the case.
Corrupt Guatemalan Mayor Indicted in Eastern District of Texas Designated by Treasury Department under Kingpin Act for Drug Trafficking ActivitiesRead the Press Release
PLANO, Texas – A 44-year-old Guatemalan Mayor has been indicted for drug trafficking activities and extradited to the Eastern District of Texas, announced U.S. Attorney Joseph D. Brown today.
Erik Salvador Suniga Rodriguez, also known as “El Pocho” surrendered to U.S. Drug Enforcement agents in Guatemala this morning and boarded an airplane for extradition to McKinney, Texas. Suniga Rodriguez was indicted by a federal grand jury on June 13, 2018 in the Eastern District of Texas and charged with drug and money laundering violations. Suniga Rodriguez was the mayor of Ayutla, a town on the border with Mexico.
Also today, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) identified Suniga Rodriguez, and the Suniga Rodriguez drug trafficking organization (Suniga Rodriguez DTO or “Los Pochos DTO”) as significant foreign narcotics traffickers pursuant to the Foreign Narcotics Kingpin Designation Act (Kingpin Act).
As a result of today’s actions, all assets in which Suniga Rodriguez has an interest in the United States or in the possession or control of U.S. persons must be blocked and reported to OFAC. OFAC’s regulations generally prohibit all dealings by U.S. persons or within (or transiting) the United States that involve any property or interests in property of blocked persons.
This case is the result of an extensive joint investigation by the Organized Crime Drug Enforcement Task Force (OCDETF). The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
The Criminal Division’s Office of International Affairs of the Justice Department provided significant assistance in securing the defendant’s extradition from Guatemala. This case is being investigated by the U.S. Drug Enforcement Administration and prosecuted by Assistant U.S. Attorney Colleen Bloss.
It is important to note that an indictment should not be considered as evidence of guilt and that all persons charged with a crime are presumed innocent until proven guilty beyond a reasonable doubt.
Connecticut Man Charged with Attempting to Provide Material Support to ISISRead the Press Release
John C. Demers, Assistant Attorney General for National Security, John H. Durham, U.S. Attorney for the District of Connecticut, and Brian C. Turner, Special Agent in Charge of the New Haven Division of the FBI, today announced that Kevin Iman McCormick, 26, of Hamden, Connecticut, has been charged by indictment with attempting to provide material support to the Islamic State of Iraq and al-Sham (ISIS), a designated foreign terrorist organization.
McCormick was arrested on Oct. 21, 2019, and charged by federal criminal complaint. On Oct. 30, 2019, a federal grand jury in New Haven returned an indictment charging McCormick with the offense. The affidavit in support of the criminal complaint was unsealed today.
As alleged in court documents and statements made in court, in October 2019, McCormick made several statements to others expressing a desire to travel to Syria and to fight for ISIS. In one conversation, McCormick stated “I gotta fight bro, because those people, Abu Masa and ISIL, they fought for me bro, I know it, I can feel it, in my heart. So it’s my time to fight . . . It just is what it is bro, it’s just my – it’s just my time to go bro.” When McCormick was asked to elaborate on where he would like to travel, McCormick responded, “I don’t know, I don’t know bro – it’s gotta be like Syria. Where ISIL is at….whichever place is easiest, whichever place I can get there the fastest, the quickest, the easiest, and where I can have a rifle and I can have some people bro. That’s what I need, I need a rifle and I need some people, I need Islamic law, I need, that’s what I need, because if I have these things, it’s going to be very hard to kill me.”
It is also alleged that, on Oct. 12, 2019, McCormick attempted to board a flight from Connecticut to Jamaica, but was prevented by the U.S. Department of Homeland Security. McCormick subsequently told an individual that he wanted to travel to Jamaica, and then onward to Syria to join ISIS. He also indicated that he wanted to acquire weapons.
It is further alleged that, on Oct. 19, 2019, McCormick made a video during which he pledged allegiance to ISIS and its leader, Abu Bakr Al-Baghdadi. Also on that date, he purchased a plane ticket from Toronto, Canada, to Amman, Jordan. On Oct. 21, 2019, McCormick was arrested after he traveled to a small private airport in Connecticut where he expected to board a plane that would fly him to Canada.
McCormick has been detained since his arrest.
The charge of attempting to provide material support to a designated foreign terrorist organization carries a maximum term of imprisonment of 20 years.
An indictment is not evidence of guilt. Charges are only allegations, and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being investigated by FBI’s Joint Terrorism Task Force (JTTF) with the assistance of the Transportation Security Administration (TSA).
The FBI’s JTTF includes participants from the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), Internal Revenue Service – Criminal Investigation Division, Naval Criminal Investigative Service, U.S. Marshals Service, U.S. Citizenship and Immigration Services, Connecticut State Police, Connecticut Department of Correction, Metropolitan Transportation Authority Police Department, Norwich Police Department, Hartford Police Department, Stamford Police Department, Norwalk Police Department, Town of Groton Police Department, UConn Police Department, Yale Police Department, and New York Police Department.
This case is being prosecuted by Assistant U.S. Attorney Douglas P. Morabito and Trial Attorney Justin Sher from the Counterterrorism Section of the Justice Department’s National Security Division.
Colorado Springs Gang Member Sentenced to over 7 Years in Federal Prison for Being A Felon in Possession of A Firearm and AmmunitionRead the Press Release
DENVER – United States Attorney Jason R. Dunn announced that Perry Wayne Suggs, Jr., age 33, of Colorado Springs, Colorado was sentenced today by U.S. District Court Judge William J. Martinez to serve 90 months (7.5 years) in federal prison, followed by 3 years on supervised release for being a felon in possession of a firearm and ammunition. Suggs appeared at the sentencing hearing in custody, and was remanded at its conclusion. ATF Denver Division joined in today’s announcement.
According to court documents and evidence presented at trial, at approximately 6:30 p.m. on January 3, 2018, Colorado Springs Police Officers were dispatched to a “shots fired” call where witnesses stated that a man in a BMW fired at a pedestrian crossing the street. Officers interviewed a mother and daughter who had witnessed the shooting. They provided the make and model of the car, as well as its license plate number, to law enforcement. The pedestrian was legally crossing an intersection when an individual in a black BMW engaged in an altercation with the pedestrian. The pedestrian had nothing in his hands and was several feet from the BMW. The driver of the vehicle pointed a firearm at the pedestrian’s legs, fired, and then fled the scene. A witness took a picture of the car’s license plate and identified the shell casing in the intersection, which was retrieved by the officers.
The victim also called 911 and was interviewed by the police officers. Based on the victim’s information as well as that of other witnesses, officers learned that the black BMW was registered to Perry Suggs, Jr., the defendant, who lived in Colorado Springs. It was determined that Suggs was a member of the Gangster Disciples street gang and had at least one felony conviction. It is against federal law for felons to possess firearms.
Officers executed search warrants at Suggs’ residence and on his BMW. While they were executing these search warrants, officers observed two firearms in plain view inside a vehicle parked at the defendant’s residence, including a black handgun and a black semi-automatic rifle. Officers then secured another search warrant on that vehicle and recovered a Glock handgun and an AR-15 style rifle, as well as ammunition. A test using the NIBIN database (National Integrated Ballistic Information Network) as well as a full forensic examination confirmed that the Glock recovered by officers matched the shell casings found at the scene.
“We are using modern technology and science, coupled with stiff federal penalties, to help rid communities of violent gun crime and gangs,” said U.S. Attorney Jason Dunn. “We will continue to offer our help to law enforcement and stand ready to assist anytime they ask.”
“The Colorado Springs Police Department, NIBIN, and observant members of the community are the reason this investigation was a success,” said ATF Denver Division Acting Special Agent in Charge Doak Dyer. “ATF, along with our law enforcement partners, will use every resource available to protect our communities from violent crime.”
This matter was investigated by the Colorado Springs Police Department and the ATF with the assistance of the Colorado Springs Metro Crime Lab. The defendant was prosecuted by Assistant U.S. Attorneys Emily Treaster and Hetal J. Doshi.
NIBIN is a national database of digital images of spent bullets and cartridge cases that were found at crime scenes or test-fired from confiscated weapons. The Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) manages the system and provides the equipment to crime labs around the country.
Chinese National Pleads Guilty to Federal Mail Fraud and Conspiracy Charges for Trafficking in Counterfeit GoodsRead the Press Release
Baltimore, Maryland –Xiaoying Xu, age 34, a Chinese citizen residing in Covina, California, pleaded guilty today to on a federal conspiracy and mail fraud charges related to her trafficking in counterfeit goods.
The guilty plea was announced by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge Jennifer C. Boone of the Federal Bureau of Investigation, Baltimore Field Office; Special Agent in Charge John Eisert of Homeland Security Investigations (HSI) Baltimore; Postal Inspector in Charge Peter R. Rendina of the U.S. Postal Inspection Service - Washington Division; and Casey Durst, Director of Field Operations, U.S. Customs and Border Protection - Baltimore Field Office.
“Xu sold counterfeit products, representing them to unsuspecting customers as legitimate merchandise bearing the registered trademarks of legitimate companies.” said U.S. Attorney Robert K. Hur. “The sale of counterfeit goods not only defrauds consumers and legitimate companies, but results in American jobs lost, American business profits stolen, and American consumers tricked into receiving substandard products.”
According to her plea agreement, from about August 2016 until approximately April 2019, Xu conspired with others to defraud e-commerce customers by importing and selling counterfeit consumer goods, specifically Pandora jewelry and Ray-Ban sunglasses. Xu used her residence and offices in El Monte and Alhambra, California, as destination points for shipments of counterfeit goods shipped from Hong Kong and China. Xu repackaged the counterfeit goods, then mailed them to unsuspecting customers throughout the United States who believed they had purchased authentic goods.
Xu and other members of the conspiracy obtained funds from the victims of the counterfeit scheme through fraudulently acquired customer accounts opened in the names of other people at a global online payment company. The online payment company sent the victims’ money to Xu by electronic transfer to bank accounts or by check, which Xu cashed at ATMs or deposited into bank accounts opened by co-conspirators.
Xu admits that as a result of her fraudulent conduct, as well as her knowledge of the fraudulent conduct of her co-conspirators, members of the conspiracy sold $2,322,845 worth of counterfeit Pandora and Ray-Ban-branded products to unsuspecting customers, causing a loss to the customers of at least that amount.
Xu faces a maximum sentence of five years in prison for conspiracy to commit mail fraud and a maximum of 20 years in prison for mail fraud. Chief U.S. District Judge James K. Bredar has scheduled sentencing for March 12, 2020.
United States Attorney Robert K. Hur commended the FBI, HSI, U.S. Postal Inspection Service, and U.S. Customs and Border Protection, in Maryland and in Los Angeles, California; Seattle, Washington; and Tampa, Florida for their work in the investigation. Mr. Hur thanked Assistant U.S. Attorneys Peter J. Martinez and Martin J. Clarke, who are prosecuting the case.
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Chinese National Arrested in $23.8 Million Scheme to Sell Counterfeit Laptop Computer Batteries on eBay and AmazonRead the Press Release
LOS ANGELES – A San Gabriel Valley man was arrested today on federal criminal charges that he participated in a $23.8 million scheme to manufacture and ship counterfeit laptop computer batteries and other electronics from China to the United States, where the bogus batteries were sold to unsuspecting buyers in online marketplaces.
Zoulin Cai, a.k.a. “Allen Cai,” 28, of La Puente, was arrested at his residence this morning on a federal grand jury indictment unsealed today. He is scheduled to be arraigned on the indictment this afternoon in United States District Court in downtown Los Angeles.
The three-count indictment alleges that Cai, a Chinese national who moved to Los Angeles County in 2012, worked for Shenzhen Theseus Technology Co. Ltd., a China-based company. Theseus Technology, which was owned and operated by Cai’s relatives, manufactured counterfeit lithium-ion batteries, some of which were designed for laptop computers.
Cai and his co-conspirators sold and shipped the counterfeit batteries to unsuspecting individual buyers via eBay and Amazon, falsely advertising them as brand-name new, genuine, original, or OEM (original equipment manufacturer) products, the indictment alleges. The batteries allegedly bore counterfeit trademarks of companies such as Apple, Dell, HP, and Toshiba, as well as counterfeit certification marks of UL, a company that tests and certifies the safety of electronic products.
Counterfeit lithium-ion laptop batteries pose significant safety risks – including the risk of extreme heat, fire, and explosions – and the batteries that Cai and his co-conspirators allegedly shipped frequently lacked required essential internal safeguards.
“Counterfeit goods are not manufactured with the same care as legitimate products backed by well-known companies and their highly developed intellectual property,” said First Assistant United States Attorney Tracy L. Wilkison. “The batteries involved in this case were sold to numerous unsuspecting online buyers, including one victim whose laptop started smoking and nearly caught fire after the battery was installed. Consumers need to exercise great caution when purchasing discounted items, particularly electronic goods, because these items pose very real safety risks.”
“Counterfeit products not only attack the name and value of a known business, but, in many cases, can cause harmful, and sometimes fatal, consequences for the unsuspecting buyer,” said Mark Zito, Acting Special Agent in Charge for Homeland Security Investigations (HSI) Los Angeles. “These fakes have no place in a fair, legitimate marketplace. While we hear about consumer fraud on a daily basis during the holiday season, the public should be assured that HSI, along with our federal and state law enforcement partners – including Customs and Border Protection and the Los Angeles Police Department – is committed to targeting the unscrupulous vendors of substandard merchandise year round. They are the ones who may pay the steep price.”
The counterfeit batteries allegedly were imported, sold, and shipped from warehouses in La Puente and the City of Industry, which Cai ran and where federal agents made undercover purchases of counterfeit laptop batteries from Cai on several occasions.
The indictment further alleges that from 2014 through June 2019, Cai and his co-conspirators fraudulently obtained at least $23.8 million from the sale of counterfeit laptop batteries through eBay and Amazon. They laundered those funds, including more than $18 million wired directly to Chinese bank accounts in the name of Theseus Technology as well as other Chinese businesses involved in the conspiracy. Cai allegedly used his ill-gotten gains for a variety of personal expenses, including monthly payments for a Maserati sports car he leased.
Cai is charged with conspiracy to traffic in counterfeit goods and labels, conspiracy to commit wire fraud and mail fraud, and conspiracy to engage in money laundering.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
If convicted of all charges, Cai would face a statutory maximum sentence of 50 years in federal prison.
This matter was investigated by Homeland Security Investigations, which was assisted in this investigation by the brand-holding companies.
This case is being prosecuted by Assistant United States Attorneys Anil J. Antony and Julia S. Choe of the Cyber and Intellectual Property Crimes Section, and Katherine Schonbachler of the Asset Forfeiture Section.
Charleston Man Sentenced to 46 Months in Federal Prison for Drug CrimeRead the Press Release
CHARLESTON, W.Va. – A Charleston man was sentenced to federal prison for a drug crime, announced United States Attorney Mike Stuart. Jalen Scruggs, 24, was sentenced to 46 months in prison and three years of supervised release for possession with the intent to distribute methamphetamine.
“MDENT’s investigation kept 187 grams of meth from making it out on the streets of Charleston,” said United States Attorney Mike Stuart. “And now this meth dealer will be spending almost four years in federal prison.”
Scruggs previously admitted that he possessed 187 grams of methamphetamine, packaged in eight separate bags, that he intended to sell. During the course of an investigation, law enforcement officers executed a search warrant on Scruggs’ home, where they found the methamphetamine already packaged for sale.
The Metropolitan Drug Enforcement Network Team (MDENT) conducted the investigation. United States District Judge Joseph R. Goodwin imposed the sentence. Assistant United States Attorney Chris Arthur handled the prosecution.
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Cedar Rapids Man Sentenced to Federal Prison for Unlawfully Possessing Loaded FirearmRead the Press Release
A man who illegally possessed a firearm was sentenced today to more than two years in federal prison.
Dante Williams, age 37, from Cedar Rapids, Iowa, received the prison term after a July 17, 2019, guilty plea to being a prohibited person in possession of a firearm. Williams unlawfully possessed a loaded pistol in his waistband at the time of his arrest for public intoxication and disorderly conduct. He was prohibited from possessing firearms based on two prior convictions for misdemeanor crimes of domestic violence. He was also prohibited for being a drug user.
Williams was sentenced in Cedar Rapids by United States District Court Judge C.J. Williams. Williams was sentenced to 27 months’ imprisonment. He must also serve a 3-year term of supervised release after the prison term. There is no parole in the federal system.
Williams is being held in the United States Marshal’s custody until he can be transported to a federal prison.
This case was brought as part of Project Safe Neighborhoods (PSN). PSN is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
This case is also part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see /media/1122011/dl?inline.
The case was prosecuted by Special Assistant United States Attorney Elizabeth Dupuich and Assistant United States Attorney Justin Lightfoot and investigated by the Cedar Rapids Police Department, the Federal Bureau of Investigation and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 18-CR-78-CJW.
Follow us on Twitter @USAO_NDIA.
Cash Rewards for Tips Leading to the Arrest of Six Most Wanted FugitivesRead the Press Release
MACON, Ga. – Authorities in Middle Georgia are actively searching for six Most Wanted fugitives, individuals named as the most dangerous wanted persons by Macon Regional Crimestoppers during the 2019 calendar year, announced Charles “Charlie” E. Peeler, the U.S. Attorney for the Middle District of Georgia. In February, the U.S. Attorney’s Office made a public commitment with Macon Regional Crimestoppers to release a quarterly list throughout 2019 of the Most Wanted violent offenders. Macon Regional Crimestoppers, a community-run organization dedicated to increasing the safety of citizens, has provided rewards up to $1,000 for tips leading to the arrest of the Most Wanted fugitives. To date, 39 of 45 fugitives have been arrested. Law enforcement is searching for six remaining wanted persons. All of the defendants are presumed innocent until and unless proven guilty in a court of law beyond a reasonable doubt. They are:
- Larry M. Bryant, 25, Bibb County, wanted for criminal street gang participation, probation violation;
- Abel Salas De’Leon, 32, Baldwin County, wanted for child molestation and aggravated child molestation;
- Tia Hill, 34, Houston County, wanted for aggravated assault against a peace officer;
- Diego A. Martinez, 41, Bibb County, wanted for child molestation;
- Martin Martinez, 43, Houston County, wanted for aggravated assault with a deadly weapon and cruelty to children;
- Moses A. Rodriquez, 34, Houston County, wanted for aggravated assault and battery.
“The success of Macon Regional Crimestoppers’ Most Wanted effort demonstrates that law enforcement and law abiding citizens in Middle Georgia are teaming up to make our communities safer,” said U.S. Attorney Charlie Peeler. “39 Most Wanted violent offenders have been successfully apprehended in 2019, with only six fugitives still on the run. With the public’s help, authorities will capture them. I want to thank Crimestoppers, our law enforcement partners and the public for their commitment to our collective mission to curb violence, and permanently change our communities for the better.”
“Coming off 43 homicides in Macon-Bibb in 2018, our law enforcement community knew we had to develop an even stronger partnership in 2019 to reduce violence. We established the Top 15 Most Wanted to identify and capture the most violent offenders, and the results have been hugely successful. We will continue this partnership in 2020, and continue to work side-by-side with law enforcement to track down the most violent offenders and develop ways to decrease violent crime in the Macon region,” said Warren Selby, Jr., Chairman of Macon Regional Crimestoppers.
The six remaining Most Wanted defendants are charged with some of the most violent crimes, including child molestation, gang activity and aggravated assault. The defendants are wanted in counties associated with Macon Regional Crimestoppers. For a complete list, and more information about Crimestoppers, visit www.crimestop.us. Macon Regional Crimestoppers is a local non-profit serving Bibb, Baldwin, Houston, Jones, Twiggs, Crawford, Monroe, and Peach counties. The organization partners with law enforcement agencies and community groups to provide anonymous rewards for tips that lead to criminal arrests. Citizens can safely and anonymously report tips at 1-877-68CRIME.
The U.S. Attorney’s Office partnership with Macon Regional Crimestoppers is a part of Project Safe Neighborhoods (PSN), 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.Questions can be directed to Pamela Lightsey, Public Information Officer, United States Attorney’s Office, at (478) 621-2603 or Melissa Hodges, Public Affairs Director (Contractor), United States Attorney’s Office, at (478) 765-2362.
- Larry M. Bryant, 25, Bibb County, wanted for criminal street gang participation, probation violation;
Carroll County Man Facing Federal Indictment for Allegedly Overcharging the U.S. Postal Service Under His Company’s Contract to Perform Maintenance and Repair Services at Postal Service FacilitiesRead the Press Release
Baltimore, Maryland – A federal grand jury has indicted Joseph Liberto, age 45, of New Windsor, Maryland, on federal wire fraud and conspiracy charges in connection with his company’s contract to perform repairs at U.S. Postal Service (USPS) facilities. The indictment was returned on December 18, 2019.
The indictment was announced by United States Attorney for the District of Maryland Robert K. Hur and Special Agent in Charge Scott Pierce of the U.S. Postal Service Office of Inspector General.
According to the 31-count indictment, between 2014 and 2018, Joseph Liberto, President of Sierra Construction LLC, in Frederick, Maryland, contracted with EMCOR-CSC to provide repair services to USPS facilities. EMCOR acted as the clearing house responsible for receiving service calls for needed maintenance and repair work on its customers’ facilities, including the USPS, and assigning such work to service providers, such as Liberto and Sierra. The indictment alleges that Liberto engaged in a scheme to defraud EMCOR and the USPS by fraudulently concealing Sierra’s use of subcontractors to carry out maintenance work it was assigned to perform, making false statements, and providing false documents to EMCOR, in order to overcharge the USPS. The indictment alleges that Sierra obtained approximately $2 million through these fraudulent overbillings.
If convicted, Liberto faces a maximum sentence of 20 years in federal prison for the conspiracy, and for each of the 30 counts of wire fraud. 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. An initial appearance in U.S. District Court in Baltimore has not yet been scheduled.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Robert K. Hur commended the Contract Fraud Investigation Division of the U.S. Postal Service Office of Inspector General for its work in the investigation. Mr. Hur thanked Assistant U.S. Attorney Jefferson M. Gray, who is prosecuting the case.
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CEO of Corporation Based in Shasta County Indicted for Retirement Fund Embezzlement and False StatementsRead the Press Release
SACRAMENTO, Calif. — A federal grand jury returned an 11-count indictment today against Maurice “Buddy” Shoe, 57, formerly of Palo Cedro, charging him with embezzlement from his employees’ retirement funds and false statements regarding those retirement funds, U.S. Attorney McGregor W. Scott announced.
According to court documents, Shoe was the founder and CEO of Joined Inc., a corporation formerly based in Shasta County that provided student recruiting and retention services to Christian colleges and universities throughout the United States. The company provided a 401(k) retirement benefit plan for its employees. From February through November 2015, Shoe embezzled approximately $122,832 from the employee retirement benefit fund, protected under the Employee Retirement Income Security Act of 1974 (ERISA), by withholding funds from employees’ paychecks for 401(k) contributions, but failing to forward those contributions to the 401(k) plan. Shoe also made false statements on a form required under ERISA as to whether there had been a failure to forward participant contributions during the 2015 plan year.
This case is the product of an investigation by the U.S. Department of Labor – Employee Benefits Security Administration, San Francisco Regional Office. Assistant U.S. Attorney Shea J. Kenny is prosecuting the case.
If convicted, Shoe faces a maximum statutory penalty of five years in prison and a $250,000 fine as to each count. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
C.E.O. and Founder of Cash Flow Partners Charged with Multimillion-Dollar Bank Fraud and Securities Fraud SchemeRead the Press Release
NEWARK, N.J. – A Passaic County, New Jersey, man was charged today for a multi-million dollar bank fraud and securities fraud scheme operated through his company, Cash Flow Partners LLC (Cash Flow), U.S. Attorney Craig Carpenito announced.
Edward Espinal, 44, of Wayne, New Jersey, was charged by complaint with one count of conspiracy to commit bank fraud and one count of securities fraud. He is scheduled to have his initial appearance this afternoon before U.S. Magistrate Judge Cathy L. Waldor in Newark federal court.
According to documents filed in this case and statements made in court:
The Bank Fraud Conspiracy
Espinal was the founder and chief executive officer (CEO) of Cash Flow, and controlled the company’s operations. From March 2016 through December 2019, Espinal led and directed a bank fraud conspiracy designed to obtain millions of dollars in loans from banks on the basis of false representations. To attract customers, Cash Flow released internet advertisements and held seminars offering to assist customers with low-paying salaries in obtaining loans. These advertisements included promotional videos featuring Espinal and a former telenovela actor. Customers contacted Cash Flow and were routed to the company’s sales department.
Employees in the sales department then encouraged customers to sign up for various loan programs that Cash Flow provided and to enter into contracts with Cash Flow. Under those contracts, employees would help customers obtain loans from banks. The Cash Flow contracts permitted customers to keep a portion of the loan proceeds and customers agreed to provide the remaining percentage of the proceeds to Cash Flow. Cash Flow agreed to pay off the loans on behalf of its customers.
Cash Flow then used false information and fraudulent document to obtain loans for its customers for which they otherwise would not have qualified, and posed as the customers in communications with the banks.
The Securities Fraud Scheme
From July 2016 through September 2019, Espinal obtained more than $5 million in investments from victim investors on the basis of false and fraudulent pretenses and representations.
Espinal solicited investments from prospective customers using a marketing campaign on Spanish language television channels and the internet, the “Cash Flow TV” YouTube page, and live presentations in Cash Flow’s offices and elsewhere. Espinal also solicited investments from individuals who obtained loans through Cash Flow’s bank fraud conspiracy, encouraging loan customers to invest loan proceeds in Cash Flow’s investment program. Once investors agreed to invest in Cash Flow, Espinal issued “promissory notes” to investors that guaranteed monthly investment returns between 1.25 percent and 4 percent. The promissory notes stated that Cash Flow would return investors’ principal either one year from the date of the promissory note, or 60 days after investors demanded payment. Espinal and other Cash Flow employees signed the promissory notes on behalf of Cash Flow.
Espinal made a number of misrepresentations to investors. He told investors that he would pool their funds with the funds of other investors in investments related to real estate, real estate companies, a gold mine in Ecuador, and construction projects in countries outside of the United States. In reality, Espinal used investor funds to pay returns to earlier investors, to pay for personal expenses for himself, his family, and another Cash Flow employee, to perpetuate the bank fraud scheme, and to market the bank fraud and investment scheme to future victims. Espinal falsely claimed that Cash Flow’s purported real estate fund, Cash Flow Capital, was “licensed” by the Securities and Exchange Commission. He guaranteed monthly returns on investment based on the purported proceeds from the sale of properties in Cash Flow’s investment portfolio. In reality, Espinal did not sell Cash Flow properties, so no profits were derived from the sale of Cash Flow properties.
Two other individuals, Raymundo Torres and Jennie Frias, have previously been charged for their roles in the Cash Flow bank fraud conspiracy. Torres has pleaded guilty.
The conspiracy to commit bank fraud charge carries a maximum potential penalty of 30 years in prison and a $1 million fine. The securities fraud counts carry a maximum penalty of 20 years in prison and a $5 million fine.
Individuals who believe they may have information about this case may contact the FBI at 1-800-CALL-FBI (225-5324).
The U.S. Securities and Exchange Commission (SEC) also filed a civil complaint against Espinal today based on the allegations underlying the securities fraud charge.
U.S. Attorney Carpenito credited special agents of the FDIC-Office of the Inspector General (FDIC-OIG), under the direction of Special Agent in Charge Patricia Tarasca in New York, and 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 charges. He also thanked the SEC for the assistance provided by its Enforcement Division.
The government is represented by Assistant U.S. Attorneys Ari B. Fontecchio of the Economic Crimes Unit and J. Stephen Ferketic of the U.S. Attorney’s Office Opioid Abuse Prevention and Enforcement Unit in Newark.
The charges and allegations contained in the complaints are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Defense counsel: Telesforo Del Valle Esq., New York
Butte pastor sentenced to probation, ordered to pay $288,757 for stealing from churchRead the Press Release
MISSOULA—The pastor of the United Pentecostal Church in Butte was sentenced today to five years of probation and ordered to pay $288,757 for embezzling from the church organization over a four-year period, U.S. Attorney Kurt Alme said.
Kenneth Emmett Hogue, 66, of Butte, pleaded guilty in August to wire fraud.
Chief U.S. District Judge Dana L. Christensen presided.
The prosecution said in court documents filed in the case that Hogue began serving as pastor of the United Pentecostal Church in Butte in 1982. In April 2012, Hogue was elected secretary/treasurer of the Rocky Mountain District of the UPC. Hogue’s duties as secretary/treasurer included making church offering deposits at the bank, writing checks for church expenses, maintaining financial records and preparing annual financial statements in conjunction with the church’s annual conferences.
From June 2012 to July 2016, Hogue embezzled $288,757 from the church. He admitted the fraud to church personnel and during an FBI interview in March 2018. Hogue carried out the scheme by using a debit card that belonged to the District to withdraw cash from ATMs, by issuing an unauthorized check to himself from a District bank account and by opening a new bank account in the name of the District, without permission, and transferring money into that account. He later removed the transferred money using ATM transactions.
Assistant U. S. Attorney Tim Racicot prosecuted the case, which was investigated by the FBI.
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Bullhead Man Sentenced to 5 Years for ManslaughterRead the Press Release
United States Attorney Ron Parsons announced that a Bullhead, South Dakota, man was sentenced on December 16, 2019, by U.S. District Judge Charles B. Kornmann, as a result of a jury convicting him of involuntary manslaughter.
Daniel Brown, age 29, was sentenced to 60 months in federal prison, to be followed by 3 years of supervised release. He was ordered to pay $100 to the Federal Crime Victims Fund.
According to court documents, on or about September 8, 2018, in Bullhead, Daniel Brown unlawfully killed Dionne Brown Otter by operating a motor vehicle recklessly while under the influence of alcohol and a controlled substance. Brown had a blood alcohol content of .22 percent and methamphetamine in his system. While driving up an unmaintained steep hill that had a walking path, Brown lost control of his crew cab truck, causing it to roll down the hill. As a result of the roll, two people were ejected, including Dionne Brown Otter. The second individual also sustained serious injuries.
This case was investigated by the Federal Bureau of Investigation, the Bureau of Indian Affairs – Office of Justice Services, and the South Dakota Highway Patrol. Assistant U.S. Attorney Jeremy Jehangiri prosecuted the case.
Brown was remanded to the custody of the U.S. Marshals Service.
Bullhead Man Charged with Vehicular BatteryRead the Press Release
United States Attorney Ron Parsons announced that a Bullhead, South Dakota, man has been indicted by a federal grand jury for Vehicular Battery.
Frank Chapman, age 30, was indicted on December 16, 2019. He appeared before U.S. Magistrate Judge Mark A. Moreno on December 13, 2019, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in federal prison and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on July 25, 2019, in Dewey County, Chapman drove a motor vehicle while under the influence of alcohol and caused serious bodily injury to another individual.
The charge is merely an accusation and Chapman is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Cheyenne River Sioux Tribe Law Enforcement Services. Assistant U.S. Attorney Jay Miller is prosecuting the case.
Chapman was released on bond pending trial. A trial date has not been set.
Browning man sentenced for molesting childrenRead the Press Release
GREAT FALLS—A Browning man who admitted to sexually molesting two children on the Blackfeet Indian Reservation was sentenced today to 27 months in prison, a lifetime of supervised release and ordered to pay $442 restitution, U.S. Attorney Kurt Alme said.
Edward Dean Cassidy, 53, pleaded guilty in September to abusive sexual contact of a minor.
U.S. District Judge Brian M. Morris presided.
Court records filed by the prosecution said that from 2014 to 2016, Cassidy sexually molested two minor children, who were under the age of 12 years.
Assistant U.S. Attorney Ryan Weldon prosecuted the case, which was investigated by the FBI.
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Broward County School Board Employee Charged with Bribery and ExtortionRead the Press Release
A former supervisor of the Broward County School Board Physical Plant Operations Division has been charged with bribery and extortion under color of official right.
Ariana Fajardo Orshan, U.S. Attorney for the Southern District of Florida and George L. Piro, Special Agent in Charge of the FBI’s Miami Field Office made the announcement.
Richard Allen Ellis Jr., 49, of Hollywood, Florida, was charged in an 8-count indictment with bribery concerning programs receiving federal funds and extortion under color of official right (Case No. 19cr60369). Yesterday, he was arraigned on the charges before U.S. Magistrate Judge Alicia O. Valle in Fort Lauderdale.
The indictment alleges, between September 26, 2018, and December 17, 2018, Ellis, while working as a Broward County School Board employee in the Custodial/Grounds Department, accepted four cash payments from an individual who worked for a contractor who did work at various Broward County public schools. The indictment further states that these payments had been occurring as early as 2016. The payments were made to Ellis, to ensure a steady flow of work for the contractor and the individual, and timely payment of the contractor’s invoices. Ellis is alleged to have accepted bribe payments wrongfully induced by his official position.
An indictment is a formal accusation of criminal conduct, not evidence of guilt. The defendant is presumed innocent unless and until proven guilty in a court of law.
U.S. Attorney Fajardo Orshan commended the FBI for its investigative efforts. This case is being prosecuted by Assistant U.S. Attorney Cynthia R. Wood.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or at http://pacer.flsd.uscourts.gov.
Bergen County Orthopedic Surgeon Charged with Failing to Pay over Payroll Taxes and Failing to Report a Foreign Bank AccountRead the Press Release
NEWARK, N.J. – A federal grand jury today indicted an orthopedic surgeon for failing to pay over payroll taxes to the IRS and failing to report a foreign bank account, U.S. Attorney Craig Carpenito announced.
Brian Mehling, 54, of Hackensack, New Jersey, was charged in an 11-count indictment with 10 counts of failing to collect, account for, and pay over payroll taxes for one quarter in 2014, three quarters in 2015, three quarters in 2016, two quarters in 2017, and one quarter in 2018, and one count of failing to report a foreign bank account holding more than $10,000 for calendar year 2018.
According to documents filed in this case and statements made in court:
Mehling, an orthopedic surgeon, started Mehling Office Management LLC, in order to pay himself and other employees as part of his medical practice. Since the year 2006, Mehling has been involved with the IRS Collection Division due to his failure to pay his quarterly employment taxes for Mehling Office Management and other entities Mehling owned and controlled. Instead, Mehling chose to spend the majority of his money on other ventures, such as traveling around the world, on his personal rental properties, and promoting his stem cell research company.
Mehling was responsible for withholding payroll taxes from the gross salary and wages of his businesses’ employees to cover individual income, Social Security, and Medicare tax obligations. For at least 10 tax quarters, Mehling’s business withheld tax payments from its employees’ checks, but Mehling failed to pay over in full the payroll taxes due to the IRS. Additionally, Mehling did not report a bank account in France that at one point held more than $10,000 in 2018.
The 10 counts of failing to collect, account for, and pay over payroll taxes each carry a maximum penalty of five years in prison, and a $250,000 fine, or twice the gross gain or loss from the offense. The count alleging failure to report a foreign bank account carries a maximum penalty of five years in prison, and a $250,000 fine.
U.S. Attorney Carpenito credited special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge John R. Tafur.
The government is represented by Assistant U.S. Attorney Leah Gould of the U.S. Attorney’s Office Criminal Division in Newark.
The charges and allegations in the indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Berea, Ohio Man Sentenced to 35 Years for Sexually Exploiting ChildrenRead the Press Release
Cody Swinnerton, 25, of Berea, was sentenced to 35 years in prison with 25 years supervised release to follow. He was also ordered to pay $45,900 in special assessments. He previously pleaded guilty on September 10, 2019 to seven counts of Sexual Exploitation of Children, and one count each of Receipt and Possession of Child Pornography after he contacted several children between the ages of 12 and 15 and coerced them into sending him sexually explicit images.
According to an affidavit in the case and information presented at sentencing:
Swinnerton began his exploitation of children in 2013 when he engaged in sexual conduct with a sleeping child and then videotaped the assault with his cellphone. Thereafter, Swinnerton attended athletic events, like the Little League World Series in South Williamsport, Pennsylvania, where he would take pictures of the preteen athletes. He would later contact the young athletes on social media sites like Instagram and Snapchat to congratulate them and share photos. Simultaneously, he would contact the boys online using a teenage female persona and solicit, entice and coerce them to send sexually explicit images of themselves.
Swinnerton used this technique to gain access to a young teenage boy and his family in New York. After an extended period of Instagram chats, Swinnerton moved to New York and gained access to the young athlete’s home by, among other things, befriending the family. On more than one occasion, Swinnerton sexually assaulted the sleeping minor and recorded the assault. Swinnerton used memorabilia he acquired during his job with the Cleveland Cavaliers to entice this victim and others to communicate with him.
The case came to the attention of law enforcement when the Ohio Internet Crimes Against Children Task Force received a tip that Swinnerton appeared to be enticing and coercing minors to produce sexually explicit images. Swinnerton controlled multiple accounts and targeted minors between the ages of 12 and 15 on Instagram and Facebook.
Swinnerton contacted the victims’ friends and family to coerce the victims into producing more images. He also threatened the victims in an effort to get them to produce sexually explicit images. Further investigation revealed potential victims in Ohio, Tennessee, Iowa, Texas, Australia, Austria and France.
A search warrant was executed at Swinnerton’s Berea residence on January 25, 2019. Relatives said Swinnerton was on vacation in Australia at the time of the search, however, ICAC investigators were able to seize several of Swinnerton’s computer devices. A forensic review of Swinnerton’s laptop revealed hundreds of sexually explicit images of preteen and teenage boys. Further investigation revealed that Swinnerton was staying in Australia with another victim and his family. Swinnerton surreptitiously recorded sexually explicit videos of the Australian boy even after learning that Ohio investigators had executed the search warrant on his house.
“Let this 35-year prison sentence send a message to those would sexually assault and exploit our children,” said United States Attorney Herdman. “We will find you anywhere in the world and we will never quit until you are brought to justice and held accountable for the unspeakable harm you have caused.”
“This case is a disturbing reminder that international borders are no longer a hindrance for online predators,” said Vance Callender, special agent in charge of HSI for Michigan and Ohio. “However, this sentence should ensure victims around the world that Homeland Security Investigations and our partners in the international law enforcement community are committed to aggressively targeting those engaged in these heinous acts.”
“This defendant's conduct should serve as a warning to parents that offenders are creating fictitious identities to groom, threaten and exploit children on today's popular Internet sites and social media apps,” said David Frattare, Commander of the Ohio Internet Crimes Against Children Task Force. “Online child exploitation offenders understand the power that these inappropriate images and videos have when it comes to continuing this victimization.”
Australian Federal Police (AFP) Assistant Commissioner Debbie Platz said alarmingly, the volume of reports concerning the sexual exploitation of children is increasing and the appetite for the vile material can lead to vulnerable children suffering devastating harm. “Today’s outcome sends a strong message to child sex offenders that you are not anonymous online,” Assistant Commissioner Platz said. “It does not matter where you live, or if you are in a different country to your victims, police will track you down and prosecute you. The partnership forged between HSI and the AFP in countering child exploitation on a global level was pivotal to the successful outcome in this matter.”
Australian Border Force Commander, Investigations, Graeme Grosse said this result was a great example of international partner agencies, working together to protect children on a global scale.
“The ABF has assisted our international partners in catching and bringing this individual to justice who was actively seeking out children with the intent to exploit and abuse them for his own gratification.” he said. “Anybody who is involved in this type of activity should know that there is nowhere to hide and the international law enforcement community is actively seeking you out to ensure are stopped and you face the full force of the law.”
This investigation was conducted by Homeland Security Investigations, the Ohio Internet Crimes Against Children Task Force, HSI-Canberra, the Australian Federal Police and Australian Border Force. The case is being prosecuted by Assistant U.S. Attorney Carol M. Skutnik.
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Baltimore Department of Public Works Supervisor Facing Federal Indictment for Using DPW Resources to Install Water, Sewer, and Fire Line Services Without Paying City Fees or Obtaining PermitsRead the Press Release
Baltimore, Maryland – A federal grand jury has indicted Ronald Maurice Smith, age 46, of Baltimore, Maryland, on the federal charges of extortion and being a felon in possession of a gun. A related criminal information was also filed charging Philip Michael Loverde, age 38, of Glen Burnie, Maryland, with extortion. The indictment and criminal information were both filed on December 18, 2019.
The federal charges were announced by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge Jennifer C. Boone of the Federal Bureau of Investigation, Baltimore Field Office; and Commissioner Michael Harrison of the Baltimore Police Department.
According to Smith’s 10-count indictment, from January 2014 to February 2016, Smith, who was a supervisor in the Baltimore City Department of Public Works’ Water and Waste Management Division (DPW), personally enriched himself and others by using Baltimore City employees, equipment, and materials to install new and upgraded water, sewer, and fire line services for private developers and property owners without obtaining the required permits, approvals, and inspections, without paying the Baltimore City fees for water, sewer, and/or fire line service installation permits and traffic control, and without installing water meters while charging lower prices to the private developers and property owners than City-approved, bonded, and licensed utilities contractors would charge.
Specifically, the indictment alleges that Smith used his authority as a DPW supervisor to cause DPW workers, using DPW equipment, to make a street cut to access the public water main, and install a pipe to connect the water main to a location for a water meter vault, and from that location to a private property, all without obtaining the necessary permits. Smith was paid in cash by the private property owner or developer either because Smith asked for a cash payment or because Smith caused his co-conspirator, licensed plumber Philip Loverde, one of the owners of All Service Plumbing and Drain Cleaning and All Service Plumbing and Heating, to create a false All Services invoice to submit to the private property owner or developer, when in fact, the indictment alleges that Smith and DPW crews performed the work. According to the indictment, when All Services was paid, Loverde cashed the check and provided the cash to Smith.
The indictment alleges that to conceal the scheme, Smith caused other DPW employees to create and submit false DPW service requests and work orders. According to the indictment, Smith caused DPW personnel to place metal plates over the street cuts DPW personnel made to install the new water service and eventually used DPW equipment, personnel, and materials to re-pave where the street cuts and excavation had occurred. The indictment alleges that Smith received at least $64,000 as a result of the scheme.
Finally, on February 5, 2016, Smith, who has a previous felony conviction, allegedly illegally possessed a .380-caliber handgun.
If convicted, Smith and Loverde each face a maximum sentence of 20 years in federal prison for extortion under color of official right. Smith also faces a maximum of 10 years in federal prison for being a felon in possession of a gun. 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. An initial appearance in U.S. District Court in Baltimore, has not yet been scheduled for Smith or Loverde.
An indictment or criminal information is not a finding of guilt. An individual charged by indictment or criminal information is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Robert K. Hur commended the FBI and Baltimore Police Department for their work in the investigation. Mr. Hur thanked Assistant U.S. Attorney Joyce K. McDonald, who is prosecuting these cases.
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Albany Attorney Sentenced to 54 Months on Money Laundering, False Tax Filing ConvictionsRead the Press Release
ALBANY, NEW YORK – Richard J. Sherwood, age 59, of Guilderland, New York, was sentenced today to 54 months in federal prison for conspiring to steal approximately $11.8 million from estates for which he served as an attorney and fiduciary.
The announcement was made by:
- United States Attorney Grant C. Jaquith;
- New York Attorney General Letitia James;
- James N. Hendricks, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI); and
- Jonathan D. Larsen, Special Agent in Charge of the New York Field Office of IRS-Criminal Investigation.
Senior United States District Judge Lawrence E. Kahn also ordered Sherwood to serve a 1-year term of supervised release, to pay $5,560,505 in restitution, and to forfeit the following as proceeds of his crimes: 12 bank and brokerage accounts, and a house overlooking Galway Lake in Saratoga County.
In a related case prosecuted by the New York Attorney General’s Office, Sherwood pled guilty, in Albany County Court, to grand larceny in the first degree, and was sentenced this afternoon to a concurrent term of 3 to 9 years in state prison.
Sherwood’s co-conspirator, Thomas K. Lagan of Cooperstown, New York, was sentenced on December 11 to 78 months in federal prison, to run concurrent with a state sentence of 4 to 12 years in prison.
United States Attorney Grant C. Jaquith stated: “Our society depends on attorneys to be honest and ethical. Richard Sherwood desecrated that trust when he stole millions of dollars from clients who relied on him to transfer their money to churches and other beneficiaries after they died. His seven-year criminal conspiracy is all the more disturbing because Sherwood was also Guilderland Town Justice at the time. Today’s sentence punishes Sherwood for his despicable conduct and requires him to repay every last dime that he stole.”
FBI Special Agent in Charge James N. Hendricks stated: “Richard Sherwood stole millions of dollars from estates meant for charities, churches, and civic organizations, while at the same time serving as an elected judge. Today’s sentencing affirms that the FBI has zero tolerance for attorneys who exploit their clients, and we will continue to work with our partners to make sure these criminals are brought to face justice.”
IRS-CI Special Agent in Charge Jonathan D. Larsen stated: “As demonstrated by the sentencing of co-conspirator Thomas Lagan last week and now Mr. Sherwood’s sentence today, IRS-Criminal Investigation continues to make tax law enforcement a key priority. Protecting victims is also one of our most important objectives. The sentences imposed in these cases illustrate the consequences of lying and stealing from the federal government and innocent taxpayers. They also underscore the government’s commitment to prosecuting tax fraud. Today’s sentence should serve as a warning and deterrent to others.”
Sherwood practiced primarily in the area of trusts and estates. Starting in about 2006, he provided estate planning and related legal services to Capital Region philanthropists Warren and Pauline Bruggeman, and to Pauline’s sister, Anne Urban, all of Niskayuna, New York. Sherwood was advising the Bruggemans when, in 2006, they signed wills directing that all their assets go to charities, churches and civic organizations, aside from bequests to Anne Urban and Julia Rentz, Pauline’s other sister.
Warren Bruggeman died in April 2009, and Pauline died in August 2011. At the time of her death, Pauline had personal and trust assets valued at approximately $20 million.
In pleading guilty to charges of money laundering conspiracy and filing a false tax return, Sherwood admitted that after Pauline Bruggeman’s death, he and Lagan conspired to steal millions of dollars from her estate as well as from Anne Urban, who died in 2013. Their conspiracy came to include the diversion and transfer to themselves of several million dollars belonging to Julia Rentz, a resident of Ohio, who was suffering from dementia at the time of the thefts and died in 2013.
Sherwood admitted that he and Lagan stole $11,831,563, and that nearly $3.6 million was transferred outright to him, with an additional $1.96 million transferred to an entity, Empire Capital Trust, LLC, that he and Lagan controlled. Sherwood also admitted that he transferred to himself the Bruggeman family camp located on Galway Lake.
Sherwood admitted that he and Lagan induced Anne Urban to create a trust whose purpose, unknown to her, was to allow him and Lagan to transfer Bruggeman/Urban assets to themselves. Sherwood and Lagan also set up more than 10 bank accounts, and created a limited liability company (Empire Capital Trust, LLC), to first conceal the theft of the money and then transfer the money to themselves.
Sherwood pled guilty to filing false federal tax returns in 2013 and 2015. These returns were false because he did not report, as other income, about $4.7 million that he received from the fraudulent scheme.
Sherwood served as Guilderland Town Justice from 2014 until his arrest on February 23, 2018. He resigned his position on March 5, 2018. He was disbarred on September 13, 2018.
The federal case was investigated by the FBI and IRS-CI, and was prosecuted by Assistant U.S. Attorney Michael Barnett. Assistant U.S. Attorneys Adam J. Katz and Alicia G. Suarez prosecuted the asset forfeiture aspects of the case.
The state case was prosecuted by Assistant Attorneys General Christopher Baynes and Matthew Peluso of the Attorney General’s Public Integrity Bureau, under the supervision of Bureau Chief Travis Hill. The Criminal Justice Division is led by Chief Deputy Attorney General Jose Maldonado. The investigation was led by Investigator Mark Spencer of the Attorney General’s Investigations Bureau, under the supervision of Deputy Chief Investigator Antoine Karam. The Investigations Bureau is led by Acting Chief John Reidy. Financial analysis was provided by Principal Auditor Investigator Meaghan Scotellaro of the Forensic Audit Section under the supervision of Deputy Chief Auditor Sandy Bizzarro and Chief Auditor Edward J. Keegan, Jr. Senior Analyst Sara Pogorzelski assisted in the investigation.
18 December 2019
Woodward Defendant Sentenced to More Than 13 Years for Gun Possession and Violence While DetainedRead the Press Release
OKLAHOMA CITY – SCOTT ALLEN JONES, 32, of Woodward, Oklahoma, has been sentenced to 161 months in prison for possessing a firearm and ammunition after a felony conviction, as well as for assaults on detention officers while in the custody of the U.S. Marshals Service, announced U.S. Attorney Timothy J. Downing.
According to an indictment filed on September 5, 2018, Jones possessed a .40 caliber pistol and various kinds of ammunition on August 21, 2018, after he had been convicted of a felony. He was ordered detained pending trial in the custody of the U.S. Marshals Service.
Later that month, on September 17, 2018, Jones assaulted three detention officers at the Logan County Jail, where he was being held pursuant to a contract with the Marshals Service. As described in a separate indictment filed on July 17, 2019, he struck each officer in the head and thereby interfered with the performance of their official duties. A probable cause affidavit filed in Logan County District Court states that Jones refused to cooperate with jailers and punched them with his fists before they were able to use a taser to subdue him.
On December 18, 2018, a jury found Jones guilty on the count charging possession of a firearm and ammunition. Jones pleaded guilty to all three assault counts on August 22, 2019.
On December 16, 2019, U.S. District Judge David L. Russell sentenced Jones to ten years in prison on the firearm count, to be followed by three years of supervised release. The court further sentenced Jones to 41 months in prison for the three assaults and ordered that sentence to run consecutively, that is, to be served after the ten-year firearm sentence.
This case is the result of an investigation by the Federal Bureau of Investigation—Oklahoma City Field Office, with assistance from the Bureau of Alcohol, Tobacco, Firearms, and Explosives; U.S. Marshals Service; the Woodward County Sheriff’s Office; and the Logan County Sheriff’s Office. Assistant U.S. Attorneys Nicholas J. Patterson and Jacquelyn M. Hutzell prosecuted the case.
This case is part of Project Safe Neighborhoods and Project Guardian, the Department of Justice’s signature initiatives to reduce gun violence and enforce federal firearms laws. For more information about Project Guardian, please see the Attorney General’s announcement here.
Reference is made to court filings for further information. To download a photo of U.S. Attorney Downing, click here.
Wilkes-Barre Man Sentenced to 98 Months’ Imprisonment for Drug Trafficking and Firearms OffensesRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced that on December 17, 2019, United States District Court Judge A. Richard Caputo sentenced Nigel Deshawn Velardo, age 23, of Wilkes-Barre, Pennsylvania, to 98 months’ imprisonment and a four-year term of supervised release, for being in possession with intent to distribute fentanyl and possession of firearms in furtherance of drug trafficking.
According to United States Attorney David J. Freed, on March 8, 2019, Velardo was found in possession of fentanyl and five semi-automatic handgun-style firearms, which were seized pursuant to a search warrant in Wilkes-Barre.
The case was investigated by the Federal Bureau of Investigation and the Wilkes-Barre Police Department. Assistant U.S. Attorney Jeffery St John prosecuted the case.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
This case was also brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.
This case is also part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. The United States Attorney’s Office has prosecuted this case with support from the following Project Guardian partners: [list partners here]. For more information about Project Guardian, please see https://www.justice.gov/opa/pr/attorney-general-william-p-barr-announces-launch-project-guardian-nationwide-strategic-plan.
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Virginia Man Sentenced to Five Years in Prison for Gun TraffickingRead the Press Release
CAMDEN, N.J. – A Virginia man has been sentenced to 60 months in prison for conspiring to traffic 35 guns into New Jersey, U.S. Attorney Craig Carpenito announced today.
Shawn K. Harvey, 54, of Locust Grove, Virginia, was previously convicted of one count of conspiracy to traffic firearms and three counts of trafficking firearms following a two-week trial before U.S. District Judge Noel L. Hillman. Judge Hillman imposed the sentence Dec. 17, 2019, in Camden federal court.
According to documents filed in this case and the evidence presented at trial:
Shawn K. Harvey and his son, Shawn M. Harvey, a/k/a “Munchy,” 29, also of Locust Grove, were originally arrested in August 2016 after agents from the Bureau of Alcohol, Tobacco and Firearms (ATF) directed and supervised a sting operation using a confidential informant, who purchased firearms from the Harveys at a parking lot in Pennsauken, New Jersey. Ultimately, the Harveys sold 35 firearms – including assault-style rifles, revolvers, shotguns and semi-automatic handguns – in 11 separate transactions spanning several weeks. One of these firearms was reported stolen in Virginia and many of the guns were brand new and came with ammunition.
In addition to the prison term, Judge Hillman sentenced Shawn K. Harvey to three years of supervised release. Shawn M. Harvey previously pleaded guilty and is scheduled to be sentenced Jan. 8, 2020.
U.S. Attorney Carpenito credited ATF special agents, under the direction of Special Agent in Charge Charlie J. Patterson, Newark Field Division, with the investigation leading to the sentencing.The government is represented by Assistant U.S. Attorney Sara A. Aliabadi of the U.S. Attorney’s Office Criminal Division in Camden.
Defense counsel: A. Harold Kokes Esq., Pleasantville, New JerseyUnited States Attorney Mike Stuart's Statement on Attorney General Barr's Launch of Operation Relentless PursuitRead the Press Release
CHARLESTON, W.Va. – United States Attorney Mike Stuart issued the following statement:
“Every citizen deserves to live without fear of violence. Under Attorney General Barr’s leadership, the Department of Justice has implemented an “all hands on deck” approach to making communities safer. The men and women in blue, who willingly put themselves in harm’s way every day to protect each of us, can be just as confident in this administration’s backing of law enforcement. The launch of Operation Relentless Pursuit demonstrates the Department’s boundless commitment to combatting violent crime in cities throughout the country that continue to be plagued by it. The Operation further demonstrates our commitment to federal, state and local law enforcement by supporting them with additional manpower and financial resources to fight violent crime. While we are fortunate that West Virginia cities have not experienced increases in violent crime as have other areas in the country, West Virginians must also know that this United States Attorney is proud to stand beside Attorney General Barr and our federal, state and local law enforcement partners to continue the fight against violent crime in our communities and support those working so valiantly to protect and serve.”
For more information on Operation Relentless Pursuit, please see the Department of Justice press release below.
The United States Department of JusticeFOR IMMEDIATE RELEASE
WWW.JUSTICE.GOV/NEWS
WEDNESDAY, DECEMBER 18, 2019
ATTORNEY GENERAL WILLIAM P. BARR ANNOUNCES LAUNCH OF OPERATION RELENTLESS PURSUITThe Operation Will Surge Federal Law Enforcement Resources into Seven of America’s Most Violent Cities
WASHINGTON – Today, Attorney General William P. Barr announced the launch of Operation Relentless Pursuit, an initiative aimed at combating violent crime in seven of America’s most violent cities through a surge in federal resources.
Joined at a press conference in Detroit, Michigan, by Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Acting Director Regina Lombardo, Drug Enforcement Administration (DEA) Acting Administrator Uttam Dhillon, FBI Director Christopher A. Wray, and U.S. Marshals Service Director Donald W. Washington, Attorney General Barr pledged to intensify federal law enforcement resources into Albuquerque, Baltimore, Cleveland, Detroit, Kansas City, Memphis, and Milwaukee – seven American cities with violent crime levels several times the national average.
“Americans deserve to live in safety,” said Attorney General William P. Barr. “And while nationwide violent crime rates are down, many cities continue to see levels of extraordinary violence. Operation Relentless Pursuit seeks to ensure that no American city is excluded from the peace and security felt by the majority of Americans, while also supporting those who serve and protect in these communities with the resources, training, and equipment they need to stay safe.”
“The men and women of ATF are deeply committed to and focused on reducing crime gun violence in our communities,” said ATF Acting Director Regina Lombardo. “We are proud that our efforts have significantly contributed to the historic reductions in violence that our nation has realized in recent years. Operation Relentless Pursuit combines the resources of ATF, DEA, FBI, and U.S. Marshals to support our state and local law enforcement partners in those cities that – regrettably – continue to be plagued by rates of violent crime that are simply too high. Through Relentless Pursuit, we pledge to hold accountable the trigger-pullers, firearm traffickers, violent criminals and those who supply them the guns to terrorize our communities. ATF will aggressively utilize every available tool, including our crime gun enforcement teams, National Integrated Ballistic Information Network and firearms tracing to identify, investigate and support the prosecution of the most violent firearm offenders.”
“Drug traffickers – including cartels and street gangs – will stop at nothing to turn a profit, often using violence and intimidation to expand their reach,” said DEA Acting Administrator Uttam Dhillon. “This targeted surge of resources will further strengthen our ability to work with our federal, state, and local partners to pursue the worst offenders and make our communities safer.”
“The FBI remains committed to providing our specialized expertise and resources to assist our federal, state and local partners fighting violent crime,” said FBI Director Christopher A. Wray. “We are here today to reaffirm our dedication to reducing violent crime in the cities selected for Operation Relentless Pursuit to combat the threats that arise from gangs and criminal enterprises that drive violence in the communities we are sworn to protect.”
“The U.S. Marshals Service is proud of the integral role we play in supporting Attorney General Barr’s strong leadership and commitment to combating violent crime and enhancing public safety throughout our nation,” said U.S. Marshals Service Director Donald W. Washington. “We will continue to work with our local, state, and federal partners to make communities safer by addressing violent crime at its core and taking the worst of the worst fugitives and other felons off the streets.”
The operation will involve increasing the number of federal law enforcement officers to the selected cities, as well as bulking up federal task forces through collaborative efforts with state and local law enforcement partners. The surge in federal agents will be complemented by a financial commitment of up to $71 million in federal grant funding that can be used to hire new officers, pay overtime and benefits, finance federally deputized task force officers, and provide mission-critical equipment and technology.
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AG
19-1421
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U.S. Attorney’s Office for the Northern District of Oklahoma Collects More Than $3 Million in Civil and Criminal Actions in Fiscal Year 2019Read the Press Release
U.S. Attorney Trent Shores announced today that the Northern District of Oklahoma collected $3,199,436.92 in criminal and civil actions in Fiscal Year 2019. Of this amount, $1,211,753.29 was collected in criminal actions and $1,987,683.63 was collected in civil actions.
Additionally, the Northern District of Oklahoma worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $1,632,217.49 in cases pursued jointly. Of this amount, $686.89 was collected in criminal actions and $1,631,530.60 was collected in civil actions.
“The United States Attorney’s Office, working on behalf of American taxpayers and victims of crime, recovered more than $3 million in criminal and civil actions in fiscal year 2019. We recovered money defrauded from government programs and pursued substantial amounts in restitution and fines that go to victims or help provide critical victim related services,” said U.S. Attorney Trent Shores. “The Asset Recovery Unit is a critical part of our team, and they do such great work for the cause of justice. I am so proud of our team of Assistant U.S. Attorneys, investigators, paralegals, and legal assistants who work diligently to see that victims are restored, restitution and fines are paid, and civil financial obligations are satisfied.”
U.S. Attorneys’ Offices, along with the Justice Department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims Fund, which distributes the funds collected to federal and state victim compensation and victim assistance programs.
Also, the U.S. Attorney’s Office in the Northern District of Oklahoma working with partner agencies and divisions, collected $1,324,755 in asset forfeiture actions in FY 2019. Forfeited assets deposited into the Department of Justice Assets Forfeiture Fund are used to restore funds to crime victims and are equitably shared for a variety of local, state, tribal, and federal law enforcement purposes.
In one case in the Northern District of Oklahoma, the court ordered a criminal defendant to pay $368,329 in restitution to the victim. The Asset Recovery Unit seized and forfeited two vehicles, a financial account, and proceeds from the sale of the convicted embezzler’s home. The government provided the funds as restitution to the victim. In another case, the Asset Recovery team seized more than $400,000 in real property, financial accounts, vehicles, and a yacht. The funds were also provided to the victim in the case.
In the Civil Division, the False Claims Act is an important tool used by the Affirmative Civil Enforcement Unit to protect the integrity of federal funds, such as taxpayer-funded health care programs. The Act allows the government to address losses it sustains by providing for treble damages and civil monetary penalties for each false claim made to the government. In April alone, two doctors settled with the United States for more than $350,000 for allegedly accepting illegal kickbacks. In both cases, the doctors immediately began making payments to restore taxpayer dollars illegally collected in the kickback schemes.
U.S. Attorney's Office collects more than $181 million in civil & criminal actions in fiscal year 2019Read the Press Release
COLUMBUS, Ohio – U.S. Attorney David M. DeVillers announced today that the Southern District of Ohio was involved in the collection of approximately $181.5 million over the past fiscal year.
The Southern District of Ohio collected more than $98 million in criminal and civil actions in fiscal year 2019. Of this amount, nearly $91.5 million was collected in criminal actions and approximately $6.7 million was collected in civil actions.
Additionally, the Southern District of Ohio worked with other U.S. Attorney’s Offices and components of the Department of Justice to collect an additional $79.5 million in cases pursued jointly by these offices.
“Our collection figures make clear that our work delivers a significant return on public investment,” said U.S. Attorney DeVillers.
The largest single recovery in a criminal case this year involved a fine ordered against GS Caltex Corporation for nearly $46.7 million, which was paid in full.
GS Caltex Corporation was one of five South Korean oil companies involved in rigging bids to defraud the U.S. Department of Defense.
Throughout the course of a conspiracy that lasted more than a decade, the five South Korean oil companies conspired to raise the price of key contracts that provided fuel on U.S. military bases in South Korea.
Assistant United States Attorneys in the Southern District of Ohio worked with the Antitrust and Civil Divisions of the Department of Justice to obtain guilty pleas and criminal fines, civil penalties and damages to the United States totaling more than $350 million.
The largest civil collections were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts were collected on behalf of numerous federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education.
The U.S. Attorney’s office, working with partner agencies and divisions, collected approximately $4 milllion in asset forfeiture actions in FY 2019. Forfeited assets deposited into the Department of Justice Assets Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.
The U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and criminal debts owed to federal crime victims. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid to the victim, criminal fines and felony assessments are paid to the department’s Crime Victims Fund, which distributes the funds collected to federal and state victim compensation and victim assistance programs.
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U.s. Attorney John C. Anderson of the District of New Mexico to Announce Stream of Law Enforcement Resources to Address Persistent Violent Crime in AlbuquerqueRead the Press Release
U.S. ATTORNEY JOHN C. ANDERSON OF THE DISTRICT OF NEW MEXICO TO ANNOUNCE STREAM OF LAW ENFORCEMENT RESOURCES TO ADDRESS PERSISTENT VIOLENT CRIME IN ALBUQUERQUE
****** MEDIA ADVISORY ******
ALBUQUERQUE, N.M. – United States Attorney John C. Anderson will announce Attorney General William P. Barr’s new initiative to reduce violent crime in Albuquerque.
WHO:
John C. Anderson
United States Attorney for the District of New Mexico
Sonya K. Chavez
United States Marshal for the District of New Mexico
James C. Langenberg
Special Agent in Charge of the Albuquerque Field Office
Federal Bureau of Investigation
Monique Y. Villegas
Special Agent in Charge of the Phoenix Field Division
Bureau of Alcohol, Tobacco, Firearms and Explosives
Kyle W. Williamson
Special Agent in Charge of the El Paso Division
Drug Enforcement Administration
Mike Geier
Chief of Police
Albuquerque Police Department
Manuel Gonzales III
Sheriff
Bernalillo County Sheriff’s Office
WHAT:
The United States Attorney and Department of Justice law enforcement leaders will announce their participation in a new violent crime reduction initiative.
WHEN:
Wednesday, December 18, 2019
12:30 p.m. MST (2:30 P.M. EST)
WHERE:
The United States Attorney’s Office for the District of New Mexico
201 Third Street N.W.
Suite 900
Albuquerque, New Mexico 87102
OPEN PRESS
NOTE: All media representatives must present government-issued photo I.D. (i.e., driver’s license) as well as valid
media credentials.
Media representatives must arrive by 12:00 p.m. MST. Inquiries regarding logistics should be directed to Assistant U.S. Attorney Sean J. Sullivan at 505-224-1514.
Do not reply to this message. If you have questions, please use the email addresses and telephone numbers for the contacts in the message.
Turner Woman Sentenced for Embezzlement from Employee Benefit PlanRead the Press Release
PORTLAND, Maine: A Turner woman was sentenced today in federal court in Portland for embezzling from an employee benefit plan, U.S. Attorney Halsey B. Frank announced.
U.S. District Judge George Z. Singal sentenced Melissa Greenlaw, a/k/a Melissa Moore, 46, to 12 months and one day in prison and three years of supervised release. The court also ordered Greenlaw to pay $137,262.16 in restitution to the victims of the offense. Greenlaw pleaded guilty on June 4, 2019.
According to court records, Greenlaw was the Vice President of Operations for a health care company. In that capacity, she was a fiduciary for the company’s Deferred Savings and Profit Sharing Plan, a defined contribution 401(k) plan for employees to save for retirement. The plan was funded by amounts withheld from participating employees’ paychecks. From approximately July 2011 until May 2014, Greenlaw directed that funds that had been contributed by employees for deposit into the plan instead be used to pay company operating expenses, including bonuses and personal expenses for herself. Greenlaw misappropriated approximately $133,000 in employee contributions from the plan.
The U.S. Department of Labor, Office of Inspector General, Office of Investigations; and the U.S. Department of Labor, Employee Benefits Security Administration investigated the case.
Tracy Resident Sentenced to 3 Years in Prison for “H-1B” Visa Fraud and Aggravated Identity TheftRead the Press Release
SACRAMENTO, Calif. — Abhijit Prasad was sentenced today to three years in prison for visa fraud and aggravated identity theft. In addition, the Honorable Charles R. Breyer, U.S. District Judge in the Northern District of California, ordered the forfeiture of $1,193,440.
The case originated in Sacramento when the grand jury there indicted Prasad in 2016, but the case was ultimately tried in San Francisco following a court order transferring the case. U.S. Attorney David Anderson for the Northern District of California and U.S. Attorney McGregor W. Scott for the Eastern District of California made the announcement.
Prasad, 52, was found guilty by a jury on Aug. 5 of 19 counts of visa fraud, two counts of fraudulent obtainment of foreign visas, and two counts of aggravated identity theft. According to the evidence at trial, Prasad filed 19 petitions for H-1B nonimmigrant visas containing false statements, made under penalty of perjury, as to purported work projects to be performed at locations in California, including Cisco Systems. The evidence at trial showed that Cisco had no expectation that the foreign workers who were the beneficiaries of the visa petitions would actually work at Cisco on an existing work project. The evidence at trial further showed that the defendant knowingly submitted forged Cisco documents to United States Citizenship and Immigration Services in support of his claims that the beneficiaries would work at Cisco.
Finally, the evidence at trial showed that Prasad fraudulently used the digital signature of a Cisco employee, who was not authorized to sign Cisco employment documents, to create a document that would leave the impression that two of the H-1B workers had an existing work project at Cisco. Prasad obtained two of the H-1B visas using this fraudulent document that purports to be a fully executed Cisco contract.
The case is the product of an investigation by the U.S. Department of State, Diplomatic Security Service’s representative to the Document and Benefit Fraud Task Force (DBFTF), overseen by Homeland Security Investigations. The DBFTF is a multi-agency task force that coordinates investigations into fraudulent immigration documents. U.S. Citizenship and Immigration Service’s Office of Fraud Detection and National Security also assisted with the investigation. Assistant U.S. Attorneys Audrey B. Hemesath and Michael A. Rodriguez prosecuted the case. Assistant U.S. Attorney Karen D. Beausey handled the forfeiture.
Tracy Resident Sentenced to Three Years in Prison for “H-1B” Visa Fraud and Aggravated Identity TheftRead the Press Release
SAN FRANCISCO —Abhijit Prasad was sentenced today to 36 months in prison following his conviction at trial for visa fraud and aggravated identity theft. The sentence was handed down by the Honorable Charles R. Breyer, U.S. District Judge in the Northern District of California.
U.S. Attorney David Anderson for the Northern District of California and U.S. Attorney McGregor W. Scott for the Eastern District of California made the announcement.
Prasad, 52, was found guilty by a jury on August 5, 2019, of 19 counts of visa fraud, two counts of fraudulent obtainment of foreign visas, and two counts of aggravated identity theft. The case originated in Sacramento where a federal grand jury indicted Prasad in 2016. The case ultimately was tried in San Francisco following a court order transferring the case there. According to the evidence at trial, Prasad filed 19 petitions for H-1B nonimmigrant visas containing false statements, made under penalty of perjury, as to purported work projects to be performed at locations in California, including Cisco Systems. The evidence at trial showed that Cisco had no expectation that the foreign workers who were the beneficiaries of the visa petitions would actually work at Cisco on an existing work project. The evidence at trial further showed that the defendant knowingly submitted forged Cisco documents to United States Citizenship and Immigration Services in support of his claims that the beneficiaries would work at Cisco.
In addition, the evidence at trial showed that Prasad fraudulently used the digital signature of a Cisco employee, who was not authorized to sign Cisco employment documents, to create a document that would leave the impression that two of the H-1B workers had an existing work project at Cisco. Prasad obtained two of the H-1B visas using this fraudulent document that purports to be a fully executed Cisco contract.
In addition to the prison term, Judge Breyer ordered Prasad to forfeit $1,193,440.87. Prasad is in federal custody and will begin serving his prison term immediately.
Assistant U.S. Attorneys Audrey B. Hemesath, Michael A. Rodriguez, and Karen Beausey are prosecuting the case. The case is the product of an investigation by the U.S. Department of State, Diplomatic Security Service’s representative to the Document and Benefit Fraud Task Force (DBFTF), overseen by Homeland Security Investigations. The DBFTF is a multi-agency task force that coordinates investigations into fraudulent immigration documents. U.S. Citizenship and Immigration Service’s Office of Fraud Detection and National Security also assisted with the investigation.
Three Plead Guilty to Participating in Drug Trafficking Conspiracy in Nashua AreaRead the Press Release
CONCORD - George Cruz, 30, of Nashua, Isaiah Kinard, 30 of Manchester, and Melvin Nooks, Jr., 29, of Fitchburg, Massachusetts, have pleaded guilty in federal court to participating in a conspiracy to distribute crack cocaine, United States Attorney Scott W. Murray announced today.
According to court documents and statements made in court, all three defendants were members of a drug trafficking organization that distributed crack cocaine and other drugs to various customers in the Nashua area. Cruz and Melvin Nooks Jr. were responsible for distributing over 280 grams of crack cocaine.
Cruz pleaded guilty on December 17, 2019, and is scheduled to be sentenced on March 31, 2020. Kinard and Nooks pleaded guilty today. Kinard is scheduled to be sentenced on March 31, 2020. Nooks Jr. is scheduled to be sentenced on April 1, 2020.
“The distribution of crack cocaine endangers all of our citizens,” said U.S. Attorney Murray. I commend the FBI agents and Nashua Police Officers who worked together to end this harmful criminal conspiracy. Drug traffickers should be aware that federal, state, and local law enforcement agencies are working together every day to put them out of business and bring them to justice.”
“Today, Cruz, Kinard, and Nooks finally accepted responsibility for trafficking crack cocaine in and around Nashua, NH after learning the hard way that the FBI and our law enforcement partners are committed to keeping illegal drugs out of our neighborhoods and schools,” said Joseph R. Bonavolonta Special Agent in Charge of the FBI Boston Division. “We will continue to work with our law enforcement partners to prevent criminal enterprises like this one from inflicting more to damage our community.”
This matter was investigated by the Federal Bureau of Investigation and the Nashua Police Department. The case is being prosecuted by Assistant U.S. Attorneys Georgiana Konesky and Anna Krasinski.
This case was supported by the Organized Crime Drug Enforcement Task Force (OCDETF). The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations.
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Three Men Sentenced to Federal Prison for Smuggling Nearly $200 Million of Cocaine on Board A Semi-Submersible SubmarineRead the Press Release
Tampa, Florida – U.S. District Judge Susan C. Bucklew has sentenced three Colombian nationals to federal prison terms for conspiracy to distribute and to possess with the intent to distribute five kilograms or more of cocaine while onboard a vessel subject to the jurisdiction of the United States. Carlos Chavez-Aguirre (35), Yesid Caicedo Asprilla (50), and David Hurtado Vallecilla (45) were sentenced to 20, 12, and 11 years, respectively. They had pleaded guilty in August and September 2019.
According to court documents, on June 18, 2019, while on routine patrol in the East Pacific Ocean, the United States Coast Guard (USCG) Cutter Munro located a 50-ft long self-propelled semi-submersible submarine with a sealed cabin approximately 92 nautical miles northwest of Tumaco, Colombia, in international waters.
USCG law enforcement officers boarded the semi-submersible submarine while it was still moving. The boarding led to the arrest of five individuals, and the recovery of 7,683 kilograms of cocaine (almost 17,000 pounds) worth approximately $192 million.
The two remaining defendants are scheduled to be sentenced on January 14, 2020 and February 12, 2020.
Carlos Chavez-Aguirre had previously been convicted of conspiracy to distribute and to possess with the intent to distribute five kilograms or more of cocaine while onboard a vessel subject to the jurisdiction of the United States.
“This case highlights the interagency cooperation that fuels the mission of the Panama Express Strike Force; which is to disrupt and dismantle transnational criminal organizations,” said FBI Tampa Division Special Agent in Charge Michael F. McPherson.
“This high-profile narcotics interdiction case was the result of the investigative efforts HSI and our partner agencies at the Panama Express Strike Force conduct on a daily basis,” said HSI Tampa Assistant Special Agent in Charge Hector Colon.
This case was investigated by the Panama Express Strike Force, an Organized Crime Drug Enforcement Task Force (OCDETF) comprised of agents and analysts from the United States Coast Guard Investigative Service, the Drug Enforcement Administration, the Federal Bureau of Investigation, Homeland Security Investigations, the Naval Criminal Investigative Service, and U.S. Southern Command's Joint Interagency Task Force South. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking and money laundering organizations and those primarily responsible for the nation’s drug supply. The case was prosecuted by Assistant United States Attorney Diego F. Novaes.
Theryn Jones and Arius Hopkins Convicted of 2014 Murder of Shaquille MalcomRead the Press Release
Geoffrey S. Berman, United States Attorney for the Southern District of New York, announced that THERYN JONES, a/k/a “Ty,” a/k/a “Old Man Ty,” a/k/a “Tyballa,” and ARIUS HOPKINS, a/k/a “Scrappy,” a/k/a “Scrap,” were convicted of the January 2, 2014, murder of Shaquille Malcolm, 20, in the Bronx, New York. JONES and HOPKINS were convicted yesterday following a two-week trial before U.S. District Judge Lewis A. Kaplan.
U.S. Attorney Geoffrey S. Berman said: “Nearly six years ago, 20-year-old Shaquille Malcolm was shot 13 times and killed in a Bronx apartment lobby. A unanimous jury has now held Jones and Hopkins responsible for this terrible crime.”
As reflected in the Indictment, and according to the evidence introduced at trial:
THERYN JONES was a high-ranking leader of the Mac Balla gang and the leader of a large-scale drug trafficking organization that distributed crack cocaine out of a residential building in the Allerton section of the Bronx, New York. Because Shaquille Malcolm and others were encroaching on JONES’s drug territory, JONES directed HOPKINS and another person to murder Malcolm.
On January 2, 2014, HOPKINS and another individual shot Shaquille Malcolm multiple times in the lobby of an apartment building located at 2818 Bronx Park East in the Bronx, New York. Malcolm died at the scene.
* * *
JONES, 42, of the Bronx, New York, and HOPKINS, 25, of the Bronx, New York, were each convicted of using a firearm to commit murder in furtherance of a drug trafficking crime (Count One), which carries a mandatory minimum sentence of five years in prison and a maximum sentence of life in prison, and murder while engaged in a conspiracy to distribute 280 grams and more of crack cocaine (Count Two), which carries a mandatory minimum sentence of 20 years’ in prison and a maximum sentence of life in prison. JONES and HOPKINS are scheduled to be sentenced on May 7, 2020.
Mr. Berman praised the outstanding investigative work of the New York City Police Department.
This case is being handled by the Office’s Violent and Organized Crime Unit. Assistant United States Attorneys Michael K. Krouse, Danielle R. Sassoon, Margaret Graham, and Jessica Fender are in charge of the prosecution.
Texas Man Pleads Guilty to Cocaine ConspiracyRead the Press Release
KANSAS CITY, Mo. – A San Elizario, Texas, man has pleaded guilty in federal court to his role in a conspiracy to distribute large quantities of cocaine in the metropolitan area.
Armando Rosales Jr., 30, pleaded guilty before U.S. Chief District Judge Beth Phillips on Tuesday, Dec. 17, to participating in the drug-trafficking conspiracy that lasted from October 2013 to Nov. 15, 2018.
By pleading guilty, Rosales admitted that he was a courier for a drug-trafficking organization. Investigators had received information that a shipment of cocaine was being delivered to the Kansas City, Missouri, metropolitan area. On Dec. 18, 2017, a DEA investigator stopped the Ford F-150 pickup Rosales was driving near Sweetwater, Texas. The investigator searched Rosales’s vehicle and found eight packages completely wrapped in electrical tape in the rear seat back of the truck. The packages contained a total of approximately eight kilograms of powder cocaine. Rosales admitted he was transporting the cocaine to the Kansas City metropolitan area.
According to the plea agreement, the drug-trafficking organization was purchasing cocaine for approximately $27,000 to $27,500 per kilogram. Accordingly, the value of the eight kilograms that Rosales transported was at least $216,000.
Co-defendant Miguel Armendariz-Rascon, 31, a citizen of Mexico residing in Olathe, Kansas, has also pleaded guilty to his role in the conspiracy. Armendariz-Rascon admitted that he aided a co-conspirator in providing $491,211 in illicit drug proceeds – which was seized by law enforcement – to another co-conspirator. Armendariz-Rascon admitted the money represented the proceeds of the distribution of more than 17 kilograms of cocaine.
Under federal statutes, Rosales and Armendariz-Rascon are each subject to a mandatory minimum sentence of five years in federal prison without parole, up to a sentence of 40 years in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendants will be determined by the court based on the advisory sentencing guidelines and other statutory factors. Sentencing hearings will be scheduled after the completion of presentence investigations by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Trey Alford and Special Assistant U.S. Attorney Robert Smith. It was investigated by the Drug Enforcement Administration, the FBI, IRS-Criminal Investigation and the Lee’s Summit, Mo., Police Department.
Suspended Andover Attorney Sentenced for Tax FraudRead the Press Release
BOSTON – A former attorney from Andover was sentenced yesterday to two years in prison for engaging in a years-long scheme to defraud the IRS.
Daniel P. Gibson, 62, was sentenced by U.S. District Judge Indira Talwani to 24 months in prison, two years of supervised release, and restitution in an amount to be determined at a later time. In May 2019, Gibson was convicted following trial of two counts of tax fraud and one count of conspiring to defraud the IRS.
At trial, the evidence showed that Gibson conspired with his accountant to prepare and file false tax returns in the tax years 2005, 2006, 2008 and 2009 that intentionally underreported approximately $3.7 million in income earned by the law firm of which Gibson was the managing partner. As a result, Gibson underreported his personal income by approximately $2.5 million and avoided taxes of more than $875,000.
United States Attorney Andrew E. Lelling and Kristina O’Connell, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston, made the announcement today. Assistant U.S. Attorneys Sara Miron Bloom and William B. Brady of Lelling’s Criminal Division prosecuted the case.
State Department Employee and Spouse Indicted for Trafficking in Counterfeit Goods from U.S. EmbassyRead the Press Release
WASHINGTON— A U.S. Department of State employee and his spouse were arrested today for their role in an international conspiracy to traffic in counterfeit goods from the U.S. Embassy in Seoul, Korea.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Billy J. Williams of the District of Oregon and Deputy Assistant Secretary Ricardo Colón of the Department of State Diplomatic Security Service made the announcement.
Gene Leroy Thompson Jr., 53, and Guojiao “Becky” Zhang, 39, were indicted by a grand jury in Eugene, Oregon, and charged with conspiracy and trafficking in counterfeit goods. According to the indictment and other court documents, from September 2017 through December 2019, Thompson Jr. and Zhang allegedly sold counterfeit Vera Bradley handbags from e-commerce accounts to persons throughout the United States.
Thompson Jr. is employed by the U.S. Department of State as an Information Programs Officer at the U.S. Embassy in Seoul, Korea. Thompson Jr. used his State Department computer to create numerous accounts on a variety of e-commerce platforms, all from within a secure space within the Embassy designed to protect classified information. Once Thompson Jr. created these accounts, Zhang took primary responsibility for operating the accounts, communicating with customers, and procuring merchandise to be stored in the District of Oregon. Thompson Jr. and Zhang also directed a co-conspirator in the District of Oregon to ship items to purchasers across the United States.
An indictment is merely an accusation, and the defendants are presumed innocent unless and until proven guilty.
The Diplomatic Security Service Office of Special Investigations investigated the case with assistance from the U.S. Postal Inspection Service. Senior Counsel Frank Lin of the Criminal Division’s Computer Crime and Intellectual Property Section, Trial Attorney Jay Bauer of the Criminal Division’s Human Rights and Special Prosecutions Section and Assistant U.S. Attorney Amy Potter of the District of Oregon are prosecuting the case.
U.S. v. Thompson et. al. IndictmentState Department Employee and Spouse Indicted for Trafficking in Counterfeit Goods from U.S. EmbassyRead the Press Release
A U.S. Department of State employee and his spouse were arrested today for their role in an international conspiracy to traffic in counterfeit goods from the U.S. Embassy in Seoul, Korea.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Billy J. Williams of the District of Oregon and Deputy Assistant Secretary Ricardo Colón of the Department of State Diplomatic Security Service made the announcement.
Gene Leroy Thompson Jr., 53, and Guojiao “Becky” Zhang, 39, were indicted by a grand jury in Eugene, Oregon, and charged with conspiracy and trafficking in counterfeit goods. According to the indictment and other court documents, from September 2017 through December 2019, Thompson Jr. and Zhang allegedly sold counterfeit Vera Bradley handbags from e-commerce accounts to persons throughout the United States.
Thompson Jr. is employed by the U.S. Department of State as an Information Programs Officer at the U.S. Embassy in Seoul, Korea. Thompson Jr. used his State Department computer to create numerous accounts on a variety of e-commerce platforms, all from within a secure space within the Embassy designed to protect classified information. Once Thompson Jr. created these accounts, Zhang took primary responsibility for operating the accounts, communicating with customers, and procuring merchandise to be stored in the District of Oregon. Thompson Jr. and Zhang also directed a co-conspirator in the District of Oregon to ship items to purchasers across the United States.
An indictment is merely an accusation, and the defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The Diplomatic Security Service Office of Special Investigations investigated the case with assistance from the U.S. Postal Inspection Service. The Criminal Division’s Office of International Affairs provided assistance. Senior Counsel Frank Lin of the Criminal Division’s Computer Crime and Intellectual Property Section, Trial Attorney Jay Bauer of the Criminal Division’s Human Rights and Special Prosecutions Section and Assistant U.S. Attorney Amy Potter of the District of Oregon are prosecuting the case.
St. Louis Man Pleads Guilty to Selling Drugs that Killed 19-year-old Chesterfield WomanRead the Press Release
St Louis – Gary Scott Hancock, 30, of St. Louis, Missouri, entered a guilty plea to one count of Distribution of a Controlled Substance Resulting in Death before the Honorable Ronnie L. White today. Hancock is scheduled to appear for sentencing on March 25, 2020.
According to court documents, 19-year-old T.G. was found unresponsive in a relative’s home in Chesterfield, Missouri on October 13, 2018. She was pronounced deceased, and a subsequent post-mortem examination revealed that she died as a result of acute fentanyl intoxication. An examination of T.G.’s phone and text messages revealed that on the evening of October 12, 2018, T.G. had exchanged text messages with a person who identified himself as “Scott.” “Scott” agreed to sell T.G. “5 beans” of “raw fenny [ ] mixed [ ] with some sort of cut” for $20. “Scott” texted T.G. that she would have to meet him at his home, and he provided her his street address in the 4300 block of Delor. Between the time of the messages and her death, evidence placed T.G. in the area of the 4300 block of Delor.
Hancock was arrested in February 2019 after he was located at his home in the 4300 block of Delor. During a video recorded interview, Hancock admitted that he had communicated with T.G. on the night of October 12, 2018, and that he typically went by his middle name, Scott. Hancock confirmed that he agreed to sell T.G. “5 beans” of fentanyl on October 12, 2018 and that T.G. had come to his residence and made the purchase.
Hancock now faces a 20-year mandatory minimum federal prison sentence. “Every individual has a clear choice when it comes to the poison that is fentanyl. Pick it up or put it down. We want you to put it down. If you do, you save your life and the lives of others. Sadly, that didn’t happen here. And when it doesn’t, you will be prosecuted federally and serve significant prison time in a facility far from the Saint Louis area,” said United States Attorney Jeff Jensen following today’s guilty plea.
The case was investigated by the Chesterfield Police Department, assisted by the Drug Enforcement Administration.
St. John, Indiana Man Pleads Guilty to Securities FraudRead the Press Release
HAMMOND- Richard E. Gearhart, 69, of St. John, Indiana has tendered his plea of guilty to conspiracy to commit securities fraud, announced U.S. Attorney Kirsch.
“Fraud schemes targeting the elderly, among the most vulnerable of victims, are particularly egregious crimes,” said US Attorney Thomas L. Kirsch, II. “My Office and our law enforcement partners are committed to prosecuting white collar crimes like those committed in this case.”
According to court documents, between in or about January 2008 and continuing through in or about March 2013, Gearhart, the owner of Asset Preservation Specialists, Inc., along with his co-conspirator, knowingly, willfully, and intentionally engaged in a securities fraud scheme in which he and his co-conspirator sold securities to more than 25 investor victims through false statements, misrepresentations, and omissions of material facts. Gearhart’s actions resulted in misleading the investor victims into purchasing securities from him and his co-conspirator whereby the victims’ investments were used for the personal benefit of Gearhart and his co-conspirator including funding businesses they owned without disclosing this information to the investor victims. In Gearhart’s plea agreement, he agreed to serve 5 years in prison and pay restitution to all victims impacted by the fraud, subject to the approval of the court. The sentencing date will be determined by the court at a later date. George R. McKown is scheduled to proceed to trial on January 27, 2020.
The case was the result of an investigation by the U.S. Postal Inspection Service, the Federal Bureau of Investigation, and the Indiana Secretary of State, Securities Division and is being prosecuted by Assistant United States Attorney Toi Denise Houston.
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