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11 December 2019
Alien Indicted on Illegal Reentry ChargesRead the Press Release
RALEIGH – Robert J. Higdon, Jr., United States Attorney for the Eastern District of North Carolina, announces that a federal grand jury in Greenville has returned an indictment charging SIMON LOPEZ-MARIANO, age 46, of Mexico with Illegal Reentry of an Aggravated Felon.
LOPEZ-MARIANO, previously deported and found in Wake County, is alleged to have been previously removed subsequent to an aggravated felony conviction (first-degree attempted robbery). Therefore, if convicted, he would face a maximum imprisonment term of 20 years, a $250,000 fine, and a term of supervised release following any term of imprisonment.
The charges and allegations contained in the indictments are merely accusations. The defendants are presumed innocent unless and until proven guilty in a court of law.
ICE’s Enforcement and Removal Operations and Homeland Security Investigations are investigating the cases.
Afghan Senator Convicted of Federal Welfare FraudRead the Press Release
NEWS RELEASE SUMMARY – December 11, 2019
SAN DIEGO – This morning, Ahmad Yusuf Nuristani pleaded guilty in federal court to Theft of Public Money, admitting that he received over $100,000 in government benefits by concealing foreign travel and residency between July 2015 and December 2018.
During a hearing before U.S. Magistrate Judge Karen S. Crawford, Nuristani admitted that he applied for Supplemental Security Income (SSI) from the Social Security Administration in July 2015. Nuristani acknowledged that he knew an SSI recipient must reside within the United States, and that he was required to report any travel outside of the United States lasting more than thirty days. Nuristani admitted to concealing and repeatedly lying to the Social Security Administration about his foreign travel and residency, and to receiving $27,492.44 in SSI payments and to causing a loss of $73,090.34 to the State of California for health care payments and services as a result of his fraud.
Nuristani, 71, is a former Fulbright Scholar and has been a prominent politician in Afghanistan for many decades. He has previously served as the governor of Herat province, and was the chairman of the Independent Election Commission of Afghanistan during their last presidential election. In September 2018, President Ashraf Ghani appointed Nuristani to the Meshrano Jirga, the upper body of parliament in Afghanistan. Nuristani served as both the head of Afghanistan’s Independent Election Commission and as an Afghan senator even as he received SSI at his claimed address in El Cajon, California.
This case was brought through the Travel and Residency Enforcement Co-Op (TREC), a pilot project of the Social Security Administration, its Office of Inspector General, the California Department of Health Care Services Investigations Division, and the United States Attorney’s Office for the Southern District of California. TREC is designed to detect and prevent misuse of the SSI program, a needs-based program administered by the Social Security Administration and designed to provide a floor of income for the aged, blind or disabled who have little or no income and resources. An individual approved to receive SSI automatically becomes eligible to receive Medi-Cal health benefits from the State of California. Since its formation in 2017, TREC has resulted in 25 federal convictions of individuals who fraudulently concealed foreign travel, foreign residency, and foreign financial resources from the Social Security Administration. To date, TREC has obtained over $2 million in court-ordered restitution to state and federal agencies, and has resulted in a savings of millions more.
Criminal investigators with the Special Inspector General for Afghanistan Reconstruction (SIGAR) also assisted with this investigation.
“I am proud of the work of this office, especially AUSA Jeffrey Hill, and our law enforcement partners for stopping this decades-long fraud, and ending the exploitation of government programs intended to help our country’s most vulnerable,” said United States Attorney Robert S. Brewer, Jr. “Those who abuse the trust of the taxpayer will be brought to justice.”
“Supplemental Security Income provides a lifeline for the elderly and disabled residing within the United States. The Social Security Administration’s Office of the Inspector General and its TREC partners vigorously investigate allegations of foreign travel and residency fraud, and prosecute those who steal from the American taxpayer. My office is pleased to see charges brought in this case, and appreciate that the U.S. Attorney’s Office shares our determination to protect the integrity of this vital income security program,” said Robb Stickley, Special Agent in Charge of the Inspector General’s Office of Investigations in San Francisco.
As a part of his plea agreement, Nuristani has agreed to make full restitution to the Social Security Administration and the California Department of Health Care Services. He faces up to 10 years in federal prison and a fine of up to $250,000 at his sentencing before the Hon. Cynthia A. Bashant on March 9, 2020.
DEFENDANT Case Number 19-cr-4967-BAS
Ahmad Yusuf Nuristani El Cajon, California.
SUMMARY OF CHARGES
Theft of Public Property – Title 18, U.S.C., Section 641
Maximum penalty: 10 years’ imprisonment, $250,000 fine, restitution
AGENCIES
Social Security Administration Office of Inspector General
California Department of Health Care Services Investigations Division
Special Inspector General for Afghanistan Reconstruction (SIGAR)
2 ex-credit union employees get prison for stealing $1MRead the Press Release
HOUSTON – Two suburban women have been ordered to federal prison following their conviction for embezzling from their former employer, announced U.S. Attorney Ryan K. Patrick.
Susanna Guajardo, 43, Pearland, and Grace Garza aka Grace Valencia, 49, Pasadena, pleaded guilty June 19 and Feb. 17, respectively.
Today, U.S. District Judge Lake handed Guajardo and Garza a total of 33 and 21 months in prison, respectively, each to be immediately followed by three years of supervised release. At the hearing, Judge Lake also ordered Guarjardo and Garza o pay $1,154,876 and $1,163,673 in restitution, respectively. In handing down the sentence, the court noted the sentence was appropriate given the long duration of the scheme and the amount of money involved.
Guajardo and Garza were long-time employees at a local credit union. Guajardo was a supervisor in the Accounting Department and Garza was a teller/vault supervisor. Both women admitted to embezzling $1,154,876 by depositing worthless checks from other banks into their credit union accounts. When the checks were returned for insufficient funds, Guajardo failed to deduct the “bounced” amounts from their credit union accounts and concealed the theft by making false entries in the bank’s books and records. Garza also stole $110,000 from the credit union’s vault.
Previously released on bond, Guajardo and Garza were permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.
The FBI conducted the investigation. Assistant U.S. Attorney Belinda Beek is prosecuting the case.
18th Street Gang Leader Indicted for Ordering Murder of 15-Year-Old Victim on Long IslandRead the Press Release
Junior Zelaya-Canales, a regional leader of the 18th Street gang, will be arraigned this afternoon before United States Magistrate Judge Robert M. Levy in federal court in Brooklyn on a fourth superseding indictment charging him with murder in aid of racketeering in connection with the September 2016 fatal shooting of 15-year-old Josue Guzman in Hempstead, New York; conspiracy to murder rival gang members; and attempted murder of rival gang members. The superseding indictment also charged 18th Street gang members Jonathan Zelaya-Diaz with conspiracy to commit murder and attempted murder in aid of racketeering, and Eric Chavez with attempted murder and assault in aid of racketeering. Chavez was arrested on Tuesday and ordered detained pending trial. Zelaya-Diaz remains at large.
Richard P. Donoghue, United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the charges.
As alleged in the superseding indictment and other court filings, the 18th Street gang is a violent street gang with members and associates in Jamaica, Queens, and in various locations across the United States.
“The superseding indictment and arrests announced today are a significant step in dismantling a violent street gang in our district,” stated United States Attorney Donoghue. “This Office, with the assistance of local and federal law enforcement partners, will not relent until violent street gangs that endanger communities have been eradicated.” Mr. Donoghue expressed his grateful appreciation to the Nassau County District Attorney’s Office, Nassau County Police Department, Queens District Attorney’s Office and the New York City Police Department (NYPD) for their assistance with the investigations.
"It defies comprehension these gang members are allegedly murdering and attempting to murder human beings for respect in their gang or in retaliation for some perceived slight,” stated FBI Assistant Director-in-Charge Sweeney. “Josue Guzman was just 15-years-old when he was shot and killed because someone deemed him to be disrespectful. We may never be able to change the mindlessness of a teenager being killed for no reason, but we can certainly make sure anyone who commits such a grotesque act will suffer the consequences.”
The Guzman Murder
In September 2016, Zelaya-Canales allegedly directed two lower-level gang members to kill Josue Guzman to demonstrate their allegiance to 18th Street gang. The murder was ordered, in part, because Guzman was believed to have offended 18th Street gang members. On September 12, 2016, at approximately 1:00 a.m., the Hempstead Police Department responded to a report of shots fired near the intersection of Linden Avenue and Laurel Avenue in Hempstead. There, the police officers found Guzman’s body lying near the curb, shot once in the back of the head. Guzman was pronounced dead at the scene.
Attempted Murder of Rival Gang Members
On July 9, 2017, Zelaya-Canales, Zelaya-Diaz and another 18th Street gang member allegedly directed the shooting of rival gang members over a turf dispute in Woodhaven, Queens. At approximately 10:30 p.m., NYPD officers responded to a 911 call about shots fired in the vicinity of 86th Road in Woodhaven. There, the police officers recovered nine 9-millimeter shell casings.
On August 9, 2017, NYPD detectives investigating the shooting executed a search warrant at Zelaya-Canales’s apartment and recovered a 9-millimeter Ruger handgun with a defaced serial number, four rounds of 9-millimeter ammunition, 56 rounds of .357 magnum ammunition, 34 rounds of .380 caliber ammunition and 23 rounds of .38 ammunition. Ballistic tests subsequently revealed that the Ruger handgun was the weapon that fired the 9-millimeter shell casings found at the scene of the shooting in Woodhaven.
Attempted Murder of “John Doe”
On September 20, 2017, in Jamaica, Queens, Eric Chavez allegedly shot “John Doe” for the purpose of maintaining and increasing his own position in the 18th Street gang, incorrectly suspecting that “Doe” was a member of the rival MS-13 gang. Chavez and another gang member approached “Doe” with guns drawn and searched him for MS-13 gang tattoos, but discovered none. Nevertheless, they shot and wounded “Doe” as he fled.
The charges in the superseding indictment are allegations, and the defendants are presumed innocent unless and until proven guilty.
The government’s case is being prosecuted by Assistant United States Attorneys Soumya Dayananda and Jonathan P. Lax.
The Defendants:
JUNIOR ZELAYA-CANALES (also known as “Terco”)
Age: 23
Queens, New YorkJONATHAN ZELAYA-DIAZ (also known as “Scooby”)
Age: 25
Hempstead, New YorkERIC CHAVEZ (also known as “Lunatico”)
Age: 20
Queens, New YorkE.D.N.Y. Docket No. 18-139 (S-4) (LDH)
10 December 2019
Ute Mountain Ute Man Sentenced to over 23 Years in Federal Prison for Two Violent CrimesRead the Press Release
DURANGO – United States Attorney Jason R. Dunn announced that Wambli Mills, age 23, of Towaoc, Colorado, was sentenced by U.S. District Court Judge Robert E. Blackburn for convictions in two separate cases, to serve, combined, over 23 years (278 months) in federal prison, followed by 7 years on supervised release. Mills appeared at the sentencing hearing in custody, and was remanded at its conclusion. A federal jury found Mills guilty of aggravated sexual assault following a week-long trial before Judge Blackburn on July 18, 2019, in case 18-cr-00415. Separately, Mills pled guilty to assault resulting in serious bodily injury of a federal police officer on September 27, 2019, before Magistrate Judge James Candelaria.
In the first case Mills was sentenced to 200 months in federal prison following an indictment by a federal grand jury, for one count of Sexual Abuse of an Incapable Victim and one count of Aggravated Sexual Abuse within the exterior boundaries of the Ute Mountain Ute Indian Reservation. According to court documents, as well as facts presented during trial and sentencing, Mills anally raped the victim, who was then able to escape and report the incident to the police. Law enforcement located Mills hiding in a nearby field with the victim’s leggings wrapped around his neck and the victim’s underwear on his person. DNA testing conducted by the FBI showed the victim’s DNA on the interior of Mills’ underwear.
In the second case Mills was sentenced to 78 months in federal prison after he and his brother, Wendell Mills, Jr., were indicted by a federal grand jury, for attempted murder and assault charges. According to court documents, as well as facts presented during sentencing, on April 8, 2018, Mills and his brother tackled a Bureau of Indian Affairs Police Officer who was attempting to effectuate an arrest in Towaoc, Colorado, on the Ute Mountain Ute Indian Reservation. While on the ground, Mills attempted to choke the officer while yelling “goodnight officer!” During the struggle, Mills’ brother grabbed the officer’s holstered pistol, causing the gun to discharge into the officer’s leg. As Mills held the officer down, Mills’ brother attempted to murder the officer by aiming what he believed to be a loaded gun at the officer’s head and pulling the trigger several times. A bystander intervened long enough for the officer to deploy his taser weapon and subdue Mills and his brother. Wendell Mills, Jr. was previously sentenced on June 3, 2019, to 121 months imprisonment by Judge Blackburn.
“Wambli Mills has twice demonstrated that he is a significant danger to the Ute Mountain Ute community,” said U.S. Attorney Jason Dunn. “As these sentences show, our office is committed to holding violent offenders in Indian Country accountable for their crimes.”
"The conduct in this case indicates a blatant disregard for the safety of those in our community," said FBI Denver Special Agent in Charge Dean Phillips. "The FBI and our partners are committed to pursuing and bringing justice to those who commit such egregious acts of violence."
These case were investigated by the Bureau of Indian Affairs and the Federal Bureau of Investigation. The defendant was prosecuted by Assistant U.S. Attorneys Jeff Graves, R. Josh Player, and Peter McNeilly.
United States and Croatia Sign Bilateral Agreements Enhancing Law Enforcement CooperationRead the Press Release
On Tuesday, United States Attorney General William P. Barr and Croatia’s Minister of Justice Dražen Bošnjaković signed an extradition and mutual legal assistance agreement on behalf of their nations at the U.S. Department of Justice in Washington, DC.
Attorney General Barr signed the bilateral U.S.-Croatia extradition and mutual legal assistance instruments, which were negotiated this year by the Department of State’s Office of the Legal Adviser and the Criminal Division’s Office of International Affairs.
Croatia’s Minister of Justice Dražen Bošnjaković and U.S. Attorney General William P. Barr“I commend the negotiators from our countries for their work on U.S.-Croatia law enforcement cooperation agreements, and for expeditiously preparing these texts for signature before Croatia begins its EU presidency next month,” said Attorney General Barr. “The instruments will further strengthen our bilateral law-enforcement relationship, improving the ability to extradite fugitives and exchange evidence needed for prosecutions.”
“This is a great achievement which will further strengthen relations between our two countries,” said Minister of Justice Bošnjaković. “These two new agreements respond to the challenges of fighting cross-border crime in a more efficient manner.”
Present at the signing were officials from the U.S. Department of State and the Ministry of Justice of the Republic of Croatia.
Croatia’s Minister of Justice Dražen Bošnjaković and U.S. Attorney General William P. BarrThe new agreements enhance bilateral relations by affording both nations with better information-sharing and cooperative capabilities. The new extradition agreement modernizes the extradition relationship between the countries, which had been governed by a 1901 treaty. The instrument provides a dual-criminality basis for extradition, and it streamlines the procedures to be followed in pursuing extradition. The mutual legal assistance instrument, the first such bilateral instrument between the countries, will better enable prosecutors to exchange information facilitating the prevention, investigation, and prosecution of crime. It will improve cooperation in the fight against terrorism, organized crime, corruption, cybercrime, and other serious transnational criminal offenses.
The instruments stem from the legal framework of the U.S.-European Union Agreements on Extradition and Mutual Legal Assistance signed on June 25, 2003, prior to Croatia entering the EU.
United States Files Complaint Seeking Forfeiture of Ancient Sculpture Stolen from Italy and Smuggled into the United StatesRead the Press Release
The United States has filed a civil complaint seeking the forfeiture of an Attic Etruscan votive statuette that was recovered by the FBI and HSI years after it was illegally excavated and smuggled out of Italy. The United States intends to return the artwork to its rightful owner.
The announcement was made by U.S. Attorney for the District of Columbia Jessie K. Liu, Timothy R. Slater, Assistant Director in Charge of the FBI’s Washington Field Office, and Raymond Villanueva, Special Agent in Charge of HSI’s Washington Field Office.
The artwork, an unusually detailed bronze statuette of a young woman, measures approximately 4.5 inches tall. The figurine’s features are believed to be reminiscent of the fifth century B.C.E., when historical Etruria covered what is now Tuscany, in Northern Italy. The statuette has been described as “among the best known examples of small scale Etruscan bronze sculpture.”
The complaint was filed in the U.S. District Court for the District of Columbia and seeks forfeiture of the sculpture on the basis that it represents the proceeds of the interstate transportation of stolen property and possession of stolen goods.
“The recovery of this artwork stolen from Italy and its people reflects our commitment to pursue justice for victims of crime here and abroad,” said Jessie K. Liu, U.S. Attorney for the District of Columbia. “The looting of cultural heritage for profit is unacceptable, and we will continue to assist in the efforts to return such items to their rightful owners.”
“The FBI works to return stolen art to preserve the culture and history of countries around the world,” said Timothy R. Slater, Assistant Director in Charge FBI Washington Field Office. “This action sends a clear message to art dealers and galleries that trafficking in stolen art ultimately does not pay. We encourage those who suspect that a piece of art is stolen to report it to law enforcement so we can return it to its rightful owners. The FBI worked closely with our HSI partners to recover this important piece, and will continue to aggressively investigate theft of cultural property.”
According to the complaint, the statuette is allegedly part of a trove of objects discovered during an illegal excavation in the Tuscan region of Italy. It was allegedly smuggled out of Italy in violation of Italian law to a prominent art gallery in Switzerland that allegedly dealt in antiquities trafficking. In approximately 1989, an American art gallery purchased the statuette and later sold it to a private collector. The statuette resurfaced when the collector tried to sell it using another American art gallery in New York. The offering price for the sculpture was $95,000.
HSI obtained custody of the statuette, and the U.S. Attorney’s Office commenced forfeiture proceedings. The government plans to return the statuette to the Italian Republic upon its filing of a claim of ownership.
The lawsuit is captioned United States v. One Attic Etruscan Votive Statuette of a Female Figure.
This case is being investigated by HSI’s Washington Field Office, the FBI’s Washington Field Office, and U.S. Customs and Border Protection. Assistant U.S. Attorneys Zia M. Faruqui and Arvind Lal, Special Assistant U.S. Attorney Stephanie Williamson, and Supervisory Paralegal Specialist Elizabeth Swienc, all from the U.S. Attorney’s Office for the District of Columbia, are representing the government.
U.S. Citizen Extradited from Brazil Sentenced for Wire Fraud ChargesRead the Press Release
BOSTON – A former accountant was sentenced today in federal court in Boston in connection with a $2 million wire fraud scheme.
Christopher Morris, 48, formerly of Lowell and Chelsea, Mass., was sentenced by U.S. District Court Senior Judge Douglas P. Woodlock to time served (approximately 32 months). Morris was ordered to pay $2,057,874 in restitution and to forfeit approximately $60,000 in cash and jewelry seized from him at the time of his arrest in Brazil. In September 2019, Morris pleaded guilty to four counts of wire fraud and 12 counts of unlawful monetary transactions. In May 2019, Morris was extradited from Brazil to the United States to face charges handed down by a grand jury in the District of Massachusetts in November 2014.
Morris admitted that he participated in a wire fraud scheme targeting his employer PBS Distribution (PBSd), a media distribution business with operations in Allston and elsewhere. Morris’ position gave him access to U.S. mail addressed to PBSd’s accounting department, including checks payable to PBSd. Beginning as early as January 2008 and continuing through September 2012, Morris took more than $2 million in checks under the guise of depositing them into PBSd’s bank accounts, but he instead endorsed them to himself and deposited them into a personal bank account. Morris used his access to PBSd’s accounting system to conceal the theft by, among other steps, fraudulently causing credits to be issued to the accounts of customers whose checks he stole, and by causing PBSd’s general ledger to be altered to show that the same customers had made payments. Morris spent the proceeds of the scheme on a lavish lifestyle that included, among other expenses, year-long apartment rentals in New York City’s Greenwich Village and Tribeca neighborhoods, the down payment, purchase and upkeep of a waterfront condominium in Chelsea, and luxury clothing, dining and travel, including a $16,000 two-week South American cruise.
United States Attorney Andrew E. Lelling; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Joseph W. Cronin, Postal Inspector in Charge of the U.S. Postal Inspection Service, Boston Field Division; and Boston Police Commissioner William G. Gross made the announcement today. The U.S. Marshals Service for the District of Massachusetts and the U.S. Department of Justice’s Office of International Affairs provided assistance with Morris’ extradition to the United States. The U.S. Attorney’s Office would also like to acknowledge Brazilian authorities for their cooperation in this matter. Assistant U.S. Attorney Seth B. Kosto, of Lelling’s Cybercrime Unit, prosecuted the case.
Two Service Members Charged with Distributing Narcotics to Overdose Victim at Electric Zoo Music Festival in 2018Read the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, and Dermot Shea, the Commissioner of the New York City Police Department (“NYPD”), announced today the arrests of LAGARIA SLAUGHTER and TANNER HOWELL, both of whom are service members stationed at a base in New York State, and the unsealing of a Complaint charging SLAUGHTER and HOWELL with distributing Molly on September 1, 2018, to a young woman attending the Electric Zoo music festival in New York, who subsequently died of a drug overdose. The Complaint also charges SLAUGHTER with conspiring to distribute Molly and LSD between May 2018 and March 2019. SLAUGHTER and HOWELL were arrested this morning and will be presented later today in federal court in Manhattan before U.S. Magistrate Judge Sarah L. Cave.
U.S. Attorney Geoffrey S. Berman said: “As alleged, Lagaria Slaughter and Tanner Howell supplied the dangerous drug Molly to a young concert-goer, who overdosed and died after using Molly and other drugs. Tragically, this is not the first time my Office has charged people in connection with the overdose death of a concert-goer at the Electric Zoo festival. Today’s arrests should serve as a dual-purpose reminder: To those who peddle dangerous and potentially lethal drugs, this Office and the NYPD are committed to apprehending and prosecuting you. To prospective users of these drugs, there is nothing ‘recreational’ about drugs that can kill you.”
NYPD Commissioner Dermot Shea said: “The NYPD is committed to bringing those who commit these acts to justice. I commend the members of the Detective Borough Bronx Overdose Squad, the U.S. Attorney’s Office for the Southern District, and the FBI, who dedicated themselves to help move this case forward.”
According to the allegations in the Complaint[1]:
On September 1, 2018, a young woman (“Victim-1”) began experiencing the effects of a drug overdose after using drugs while attending the Electric Zoo music festival (the “Festival”) on Randall’s Island in Manhattan. Victim-1 died on September 3, 2018, after being treated for the overdose at a hospital in Manhattan. Following an investigation by the NYPD, law enforcement identified SLAUGHTER and HOWELL, both members of the U.S. military stationed at a base located in New York State (the “Base”), as individuals who distributed Molly (3,4-methylenedioxymethamphetamine) to Victim-1 on September 1, 2018, while she was attending the Festival and shortly before she fatally overdosed. Medical records show that Victim-1’s death was caused by acute intoxication from the combined effects of multiple drugs, including Molly.
Days earlier, SLAUGHTER had organized a trip to New York City with other service members to attend the Festival. At that time, SLAUGHTER was involved in trafficking both Molly and LSD (lysergic acid diethylamide). From May 2018 to March 2019, SLAUGHTER worked with others to sell Molly and LSD to customers on and off the Base. While in New York City for the Festival, SLAUGHTER and another individual met HOWELL at a nightclub. HOWELL told SLAUGHTER that he was going to the Festival the following day with a large group of friends and they wanted to buy Molly to take while at the Festival. SLAUGHTER agreed to supply the Molly for distribution to the group. The following day, September 1, 2018, HOWELL arranged to purchase 57 capsules of Molly from SLAUGHTER, at a total price of $560. SLAUGHTER and another individual traveled to the Festival to sell the Molly. HOWELL had two female members of his group – Victim-1 and her friend – meet SLAUGHTER and the other individual outside the concert entrance to retrieve the Molly to be used by the group. HOWELL paid for the Molly via electronic payment, and SLAUGHTER provided the 57 capsules of Molly to Victim-1 and her friend. Upon completion of the transaction, Victim-1 and her friend entered the Festival with the Molly. Victim-1 overdosed later that day and died two days later.
On April 24, 2019, law enforcement searched SLAUGHTER’s barracks at the Base. Law enforcement recovered, among other things, approximately 10 capsules of Molly, 55 doses of LSD, and drug packaging materials. Text messages recovered from SLAUGHTER’s cellphone show SLAUGHTER offering to sell hundreds of capsules of Molly to other service members on the Base.
* * *
SLAUGHTER, 25, of Jefferson County, New York, is charged with one count of conspiring to distribute Molly and LSD, and one count of distributing and possessing with intent to distribute Molly. Both counts carry a maximum sentence of 20 years in prison.
HOWELL, 22, of Jefferson County, New York, is charged with one count of distributing and possessing with intent to distribute Molly, which carries a maximum sentence of 20 years in prison.
The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants would be determined by the judge.
Mr. Berman praised the outstanding investigative work of the NYPD.
This case is being handled by the Office’s Narcotics Unit. Assistant United States Attorneys Dominic A. Gentile and Peter J. Davis are in charge of the prosecution.
The charges contained in the Complaint are merely accusations and the defendants are presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint, and the description of the Complaint set forth herein, constitute only allegations, and every fact described should be treated as an allegation.
Two Men Arrested During Operation Independence Day Plead GuiltyRead the Press Release
Two men have pleaded guilty in U.S. District Court to child sex crimes charges, announced U.S. Attorney Trent Shores.
The two defendants were arrested as part of Operation Independence Day, a month-long operation led by the FBI to apprehend child predators and recover victims of child exploitation and sex trafficking. The operation was executed during the month of July.
“There is no more righteous cause than protecting our children from sex predators. Investigators and prosecutors are ever vigilant and act with urgency to bring these predators to justice,” said U.S. Attorney Trent Shores. “Operation Independence Day was a success because of the men and women of law enforcement who came together in a common cause and mission.”
Carnell Lovette Matthews, 43, of Tulsa, pleaded guilty Dec. 5, 2019, to receipt of child pornography. In his plea agreement, Matthews admitted that from April 30, 2019, to May 2, 2019, he used his smart phone to persuade and entice a minor to send him sexually explicit photographs. He also tried to persuade the minor victim to meet with him to engage in sexual activity. Matthews stated that he knew the victim was under 18 years of age. Chief U.S. District Judge John E. Dowdell scheduled sentencing for March 10, 2020. The Broken Arrow Police Department, Tulsa Police Department, and FBI conducted the investigation. Assistant U.S. Attorney Christopher J. Nassar prosecuted the case.
JJason Ray Smith, 40, of Sapulpa, pleaded guilty Dec. 10, 2019, to attempted coercion and enticement of a minor. Smith admitted to using a social media app to communicate with a person he believed to be 14 years of age but who was an undercover officer. He arranged to meet the “girl” in Tulsa with the intent of engaging in sexual activity with her. Smith was arrested on July 3, 2019. U.S. District Judge Gregory K. Frizzell scheduled sentencing for March 5, 2020. The Tulsa Police Department, Tulsa County Sheriff’s Office and FBI conducted the investigation. Assistant U.S. Attorneys Reagan Reininger and Shannon Cozzoni prosecuted the case.
Operation Independence Day is part of the broader Project Safe Childhood initiative. PSC combats the growing epidemic of child sexual exploitation and abuse and was launched in May 2006 by the Department of Justice. Led by United States Attorney’s Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Two Brooklyn Men Charged in Strongarm Extortion SchemeRead the Press Release
TRENTON, N.J. – Two New York men were charged today with conspiracy to commit extortion using threats of force, violence, and fear, U.S. Attorney Craig Carpenito announced.
Francis A. Garzon, 30, and Endrit Kllogjeri, 26, both of Brooklyn, New York, are each charged by complaint with one count of conspiracy to commit extortion. Both individuals appeared today before U.S. Magistrate Judge Douglas E. Arpert in Trenton federal court.
According to documents filed in this case and statements made in court:
From Dec. 1, 2019, through Dec, 9, 2019, Garzon and Kllogjeri, along with another unidentified individual, conspired to extort a resident of Monmouth County, New Jersey, -- “Victim 1” – and the resident’s son, who resided in Brooklyn. Victim 1 was allegedly threatened with physical harm if Victim 1 did not recover a bag containing property allegedly valued at $100,000 from Victim 1’s son, identified in the complaint as “Victim 2.” Garzon further demanded an additional payment of $100,000 as “interest” for Victim 2’s possession of the bag. In connection with issuing oral threats against Victim 1, including assuring that Victim 1 did not “know who [Victim 1 was] dealing with,” Garzon additionally brandished a revolver, pointing the weapon at Victim 1 before cocking the revolver’s hammer. In a series of telephone and in-person conversations over several days following the visit to Victim 1’s home, Garzon continued to threaten Victim 1, even sending Victim 1 cellphone messages containing photographs and videos of Victim 2 and Victim 2’s family.
The count of conspiracy to commit extortion carries a maximum potential penalty of up to 20 years in prison and a fine of up to $250,000 or twice the gross pecuniary gain or loss.
U.S. Attorney Carpenito credited special agents with the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, New Jersey, and the Marlboro Township Police Department, under the direction of Police Chief Peter Pezzullo, with the investigation leading to the charges.
The government is represented by Assistant U.S. Attorney Eric A. Boden of the U.S. Attorney’s Trenton Office.
The charge and allegations contained in the complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Turtle Creek Man Charged with Firearms Law ViolationRead the Press Release
PITTSBURGH, PA – A resident of Turtle Creek, Pennsylvania, has been indicted by a federal grand jury in Pittsburgh on a charge of violating federal firearms laws, United States Attorney Scott W. Brady announced today.
The one-count Indictment named Sean Johnson, Jr., age 25, as the sole defendant.
According to Indictment, on or about November 19, 2019, Johnson, a convicted felon, was found to be in possession of a firearm and 16 rounds of 9mm ammunition. Federal law prohibits a convicted felon from possessing a firearm and/or ammunition..
The law provides for a maximum total sentence of not more than ten years in prison, a fine of not more than $250,000.00 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Brendan T. Conway and Brian M. Czarnecki are prosecuting this case on behalf of the government.
The Federal Bureau of Investigation, Monroeville Police Department, the Attorney General’s Office, the Drug Enforcement Agency’s Maryland Office, and the Allegheny County Police Department conducted the investigation leading to the Indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Toledo man sentenced for planning terrorist attack in Toledo’s entertainment districtRead the Press Release
Vincent Armstrong, 24, was sentenced today to 72 months of incarceration for his involvement in planning a terrorist attack at a local Toledo bar. His co-defendant and live-in girlfriend, Elizabeth Lecron, was previously sentenced to 180 months of incarceration and lifetime supervised release.
“This defendant admitted to helping plot and plan a mass-casualty attack in Toledo,” said U.S. Attorney Justin Herdman. “His sentence reflects the seriousness of the charges against him and should serve as a reminder to all who live in our District and beyond - we will never stop working to protect our families, friends and neighbors.”
"Vincent Armstrong's sentence will ensure he remains safely away from the public for some time,” said FBI Special Agent in Charge Eric Smith. “He and his fellow conspirator, Elizabeth LeCron, planned to attack and murder their fellow citizens for no other reason than their infatuation with violence. The FBI once again applauds the public for bringing LeCron and Armstrong's plans to the attention of law enforcement. Without the reporting of their dangerous plans one of our communities could have suffered a horrendous mass shooting. Law enforcement depends on the public's vigilance to counter insidious plots like these."
Toledo Police Chief George Kral said: “With the sentencing of this potential mass murderer, as was the case in his co-conspirators, residents of Toledo and NW Ohio are safer. Sadly, these individuals reside not only in our major cities, but also much closer to home. I commend the relationships and collaborations we have with of local, state and federal law enforcement partners. Toledoans can sleep soundly knowing that law enforcement will never cease in the identification, investigation, and prosecution of those who want to hurt innocent people.”
As set out in court filings and during court hearings, Lecron and Armstrong met and started dating in early 2018. The two became immersed in a subculture that fixated and lionized mass murderers known as the “True Crime Community.” Their obsession included a trip in August 2018 to visit the sights related to the Columbine High School shooting to pay tribute to the shooters.
Lecron and Armstrong privately discussed committing their own mass murder in the Toledo area and referred to this attack as “D-day.” They discussed using bombs and guns to kill, maim, and injure innocent people. They took several steps in preparation for “D-day.” They purchased guns and went to the shooting range to practice their firearm skills. They also printed instructions to make pipe bombs and bought some the necessary components. They detailed their plan and feelings in personal journals. For instance, Armstrong wrote that he had “a vision to kill” and Lecron wrote, “D-day will be my salvation.”
This conduct took place between April 2018 and December 10, 2018.
This case was investigated by the FBI Joint Terrorism Task Force and prosecuted by Assistant U.S. Attorneys Michael Freeman and Tracey Tangeman.
Three South Florida Residents Indicted on Federal Sex Trafficking ChargesRead the Press Release
Law Enforcement Seize www.fosterscareinc.com, an Internet Forum Believed to Facilitate Sex Trafficking
Three South Florida residents face federal charges related to their alleged involvement with a sex trafficking organization. Law enforcement seized a website, www.fosterscareinc.com, which is alleged to have facilitated the sex trafficking.
Ariana Fajardo Orshan, U.S. Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, FBI’s Miami Field Office, and Anthony Salisbury, Special Agent in Charge, Homeland Security Investigations’ (HSI) Miami Field Office made the announcement.
William D. Foster, 48, of Delray Beach, Ashleigh Holloway, 36, of Fort Lauderdale, and Hanah Chan, 30, of Delray Beach, were charged in an indictment unsealed yesterday (Case No. 19-CR-20804). Foster was charged with one count of conspiracy to commit sex trafficking, one count of sex trafficking of a minor and by force, fraud, or coercion, and two counts of sex trafficking by force, fraud, or coercion. Foster, Holloway, and Chan were charged with one count of sex trafficking by fraud and coercion. Foster and Chan were charged with one count of transportation of an individual for prostitution.
Foster was previously arrested on a criminal complaint, following the execution of three residential search warrants in Delray Beach, Florida.
According to the court record, including allegations contained in a criminal complaint, Foster was the leader of a sex trafficking organization. A victim was allegedly recruited into Foster’s sex trafficking organization in or around August 2007 as a minor, and was commercially sex trafficked by Foster both as a minor, and then as an adult, from approximately November 2007 through May 2010.
A second victim was allegedly recruited into Foster’s organization and was commercially sex trafficked by Foster from approximately May 2004 through August 2011.
It is alleged that these victims were moved across state lines for purposes of prostitution. When they were minors, it is alleged Foster arranged for the victims to obtain false identification. In addition, Foster is alleged to have had sex with the victims on multiple occasions, beginning when they were minors.
The court documents allege that at any given time approximately five to fifteen females lived with, and worked for, Foster. The females worked at exotic dance venues in Miami-Dade, Broward, and Palm Beach Counties, and engaged in commercial sex at Foster’s direction. It is alleged that the females were not able to keep any proceeds derived from their prostitution or exotic dancing but instead were compelled to turn over the money to Foster based on his false promises to invest their earnings. The females also reported incidences of domestic violence while living with Foster.
The court filings allege that a third victim contacted law enforcement in September 2019 because she was being pressured to engage in commercial sex by Foster and his organization after being flown from Fort Lauderdale, Florida, to Detroit, Michigan.
Holloway and Chan were charged with Foster in the indictment with sex trafficking by fraud and coercion in connection with the third victim, and Chan and Foster were charged with the transportation of an individual for prostitution in connection with the third victim.
During the course of this investigation, law enforcement identified a website, www.fosterscareinc.com. On November 21, 2019, law enforcement seized the website www.fosterscareinc.com, based on a finding by a U.S. Magistrate Judge that there was probable cause to believe that the website was used, or intended to be used, to commit or facilitate the commission of sex trafficking of children, or by force, fraud, or coercion. It is alleged that Foster had another individual create the website in order to facilitate the sex trafficking enterprise.
On November 19, 2019, Foster was ordered detained pending trial based on a finding by U.S. Magistrate Judge Bruce E. Reinhart in West Palm Beach, Florida, that the defendant poses a danger to the community. Holloway and Chan are scheduled to have their pre-trial detention hearings on December 13, 2019 and to be arraigned on December 19, 2019.
An indictment and criminal complaint are charging documents containing allegations. All defendants are presumed innocent unless proven guilty beyond a reasonable doubt in a court of law.
U.S. Attorney Fajardo Orshan commended the investigative efforts of the FBI, HSI Miami Field Office, HSI Detroit Field Office, Florida Office of Financial Regulation, Delray Beach Police Department, Palm Beach County Sheriff's Office, Hollywood Police Department, Miami-Dade Police Department, and Sebastian Police Department. This case is being prosecuted by Assistant U.S. Attorneys J. Mackenzie Duane and Jessica Kahn Obenauf. Assistant U.S. Attorney Peter A. Laserna is handling the asset forfeiture aspects of the case.
To report suspected human trafficking or to obtain resources for victims, please call 1-888-373-7888; text “BeFree” (233733), or live chat at HumanTraffickingHotline.org. The toll-free phone, SMS text lines, and online chat function are available 24 hours a day, 7 days a week, 365 days a year. Help is available in English, Spanish, Creole, or in more than 200 additional languages. The National Hotline is not managed by law enforcement, immigration or an investigative agency. Correspondence with the National Hotline is confidential and you may request assistance or report a tip anonymously.
To learn more about the National Resource Hotline visit www.humantraffickinghotline.org. To learn more about the U.S. Department of Justice’s efforts to combat human trafficking visit www.justice.gov/humantrafficking.
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.
Three Men Arrested in $722 Million Cryptocurrency Fraud SchemeRead the Press Release
NOTE: A fourth defendant, Silviu Catalin Balaci, was arrested in Germany after the issuance of this press release. The attached indictment has been amended to reflect this.
NEWARK, N.J. – Three men were arrested today in connection with a cryptocurrency mining scheme that defrauded investors of $722 million, U.S. Attorney Craig Carpenito announced.
Matthew Brent Goettsche, 37, of Lafayette, Colorado, and Jobadiah Sinclair Weeks, 38, of Arvada, Colorado, are charged by indictment with conspiracy to commit wire fraud and Goettsche, Weeks, and Joseph Frank Abel, 49, of Camarillo, California, are charged by indictment with conspiracy to offer and sell unregistered securities. Goettsche was arrested in Colorado, Weeks in Florida, and Abel in California. All three are scheduled to have their initial appearances in the districts of their arrests. Two defendants remain at large and their identities remain under seal.
“The indictment describes the defendants’ use of the complex world of cryptocurrency to take advantage of unsuspecting investors,” U.S. Attorney Carpenito said. “What they allegedly did amounts to little more than a modern, high-tech Ponzi scheme that defrauded victims of hundreds of millions of dollars. Working with our law enforcement partners here and across the country, we will ensure that these scammers are held to account for their crimes.”
“Those arrested today are accused of deploying elaborate tactics to lure thousands of victims with promises of large returns on their investments in a bitcoin mining pool, an advanced method of profiting on cryptocurrency,” Paul Delacourt, the Assistant Director in Charge of the FBI’s Los Angeles Field Office said. “The defendants allegedly made hundreds of millions of dollars by continuing to recruit new investors over several years while spending victims' money lavishly.”
“Today’s indictment alleges the defendants were involved in a sophisticated Ponzi scheme involving hundreds of millions of dollars that preyed upon investors all over the world,” John R. Tafur, Special Agent in Charge, IRS Criminal Investigation, Newark Field Office, said. “This was a classic con game with a virtual twist; false promises of large returns for investing in the mining of Bitcoin. IRS Criminal Investigation will continue to work with our law enforcement partners, including the Joint Chiefs of Global Tax Enforcement, to investigate and bring to justice cyber criminals.”
According to documents filed in this case and statements made in court:
From April 2014 through December 2019, the defendants operated BitClub Network, a fraudulent scheme that solicited money from investors in exchange for shares of purported cryptocurrency mining pools and rewarded investors for recruiting new investors. Goettsche, Weeks, and others conspired to solicit investments in BitClub Network by providing false and misleading figures that BitClub investors were told were “bitcoin mining earnings,” purportedly generated by BitClub Network’s bitcoin mining pool. Goettsche discussed with his conspirators that their target audience would be “dumb” investors, referred to them as “sheep,” and said he was “building this whole model on the backs of idiots.” Goettsche directed others to manipulate the figures displayed as “mining earnings” during the course of the conspiracy.
For example, in February 2015, Goettsche directed another conspirator to “bump up the daily mining earnings starting today by 60%,” to which his conspirator warned “that is not sustainable, that is ponzi teritori [sic] and fast cash-out ponzi . . . but sure.” In September 2017, Goettsche sent an email to another conspirator in which he suggested that Bitclub Network “[d]rop mining earnings significantly starting now” so that he could “retire RAF!!! (rich as fuck).” Weeks sent an email in June 2017 to Goettsche and another conspirator in which he remarked that BitClub selling shares in BitClub and then not using the money to purchase mining equipment was “not right.” Goettsche, Weeks, and others obtained the equivalent of at least $722 million from BitClub Network investors.
Goettsche, Weeks, Abel, and others also conspired to sell BitClub Network shares – which were securities – notwithstanding that BitClub Network did not register the shares with the U.S. Securities and Exchange Commission. Weeks and Abel created videos and traveled around the United States and the world to promote BitClub Network. In one video, a conspirator espoused that BitClub Network was “the most transparent company in the history of the world that I’ve ever seen.” In another video, Abel assured investors that BitClub Network was “too big to fail.”
The wire fraud conspiracy charge carries a maximum potential penalty of 20 years in prison, and a fine of up to $250,000. The conspiracy to sell unregistered securities charge carries a maximum penalty of five years in prison and a fine up to $250,000.
U.S. Attorney Carpenito credited special agents and task force officers of the FBI’s Los Angeles Division’s West Covina Resident Agency, under the direction of Acting Assistant Director in Charge Delacourt; special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge John R. Tafur in Newark; and the IRS Los Angeles Field Office, under the direction of Special Agent in Charge Ryan L. Korner, with the investigation leading to today’s charges.
Anyone who believes they may be a victim may visit www.justice.gov/usao-nj/bitclub or the Department of Justice’s large case website www.justice.gov/largecases. There, victims can find more information about the case, including a questionnaire for victims to fill out and submit.
The government is represented by Unit Chief David W. Feder and Assistant U.S. Attorneys Anthony P. Torntore and Jamie L. Hoxie, of the Cybercrime Unit, and Unit Chief Sarah Devlin of the Asset Recovery and Money Laundering Unit of the U.S. Attorney’s Office in Newark.
The charges and allegations contained in the indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
Syracuse Man Sentenced to Prison for Sophisticated Fraud SchemesRead the Press Release
SYRACUSE, NEW YORK – Donald M. Geiss, Jr., age 44, of Syracuse, was sentenced yesterday to 65 months in prison after previously pleading guilty to four counts of wire fraud and two counts of aggravated identity theft in relation to various schemes to defraud he perpetrated on victims in multiple states, announced United States Attorney Grant C. Jaquith and James N. Hendricks, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI).
In previously pleading guilty, Geiss admitted that between approximately August 2016 through August 2017 he perpetrated various fraud schemes on victims in multiple states, including by collecting money from his victims by (1) posing as an investor and pretending to go through the process of buying a business in the Syracuse area in order to gain access to the business; (2) pretending to negotiate the sale of a non-existent computer algorithm for insurance claims to a well-known multinational finance and insurance corporation in New York; (3) convincing a victim to purchase several online video game profiles from other people on Geiss’s behalf; and (4) selling fake and fraudulent “discount” airline tickets over the internet. In perpetrating these various crimes, Geiss used at least one alias, one false identity, and two stolen identities. Geiss ultimately obtained a total of more than $167,000 from his various victims.
Geiss was on supervised release related to a prior federal fraud conviction when he committed all of the crimes for which he was sentenced yesterday. In addition to the 65-month prison sentence, Geiss was also sentenced to serve an additional 6 months in prison for violating the terms of his supervised release by committing the fraud and aggravated identity theft offenses. In total, Geiss will serve 71 months in prison. The Court also ordered Geiss to pay money judgments totaling over $153,000, and to pay restitution to his victims of more than $167,000. Following his release from prison, Geiss will be on supervised release for 3 years.
This case was investigated by the Federal Bureau of Investigation (FBI), and was prosecuted by Assistant U.S. Attorney Michael F. Perry.
Swissvale Man Facing Drug and Gun Possession Charges in Project Safe Neighborhoods CaseRead the Press Release
PITTSBURGH, PA - A resident of Swissvale, Pennsylvania, has been indicted by a federal grand jury in Pittsburgh on federal narcotics and firearms charges, United States Attorney Scott W. Brady announced today.
The six-count superseding indictment named Kevin Darwin-Sewell, 31, as the sole defendant.
According to the Superseding Indictment presented to the court, Darwin-Sewell is charged with possession with intent to distribute heroin and cocaine base, possession of a firearm by a convicted felon, and possession of a firearm in furtherance of a drug trafficking crimes which occurred on July 19, 2016 and February 1, 2017.
The law provides for a maximum total sentence of not less than ten years and up to life in prison, a fine of $1,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history of the defendant.
This case is being prosecuted under Project Safe Neighborhoods, a collaborative effort by federal, state and local law enforcement agencies, prosecutors and communities to prevent, deter and prosecute gun crime. The Bureau of Alcohol, Tobacco, Firearms and Explosives, the Pittsburgh Police Department, and the Wilkinsburg Police Department conducted the investigation leading to the superseding indictment in this case. Assistant United States Attorney Gregory C. Melucci is prosecuting this case on behalf of the government.
A superseding indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Stock Promoter Sentenced to 7 Years in Prison in Multi-Million Dollar Securities Fraud CaseRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that Dino Paolucci, age 42, of Mississauga, Ontario, was sentenced to 84 months’ imprisonment by United States District Judge Eduardo C. Robreno for participating in five stock manipulation schemes in 2012 and 2013. In addition, the Court also ordered Paolucci to pay $2 million in forfeiture.
Paolucci’s sentence arose from what is commonly referred to as a “pump and dump” scheme, stemming from his manipulation of the price and trading volume of the stock of five public companies: AGR Tools, Inc. (“AGRT”), LiveWire Ergogenics (“LVVV”), YaFarm Technologies (“YFRM”), Resource Ventures (“REVI”), and Medical Cannabis Payment Solutions (“REFG”). As part of these manipulations, Paolucci and his co-schemers obtained control over the companies, distributed shares of stock to themselves and their nominees through fraudulent means, issued false and misleading press releases and promotions regarding the companies in order to artificially inflate the price and/or trading volume of the stocks, and then sold their shares into the manipulated markets – thereby reaping millions. For good measure, they also concealed all of their illegal activity from the U.S. Securities and Exchange Commission (the “SEC”).
Paolucci played a critical role in the scheme by orchestrating the false and misleading promotions used to “pump up” the stocks in question. He issued most of his promotions by widely distributing email newsletters (“email blasts”) touting the stocks under various business names, including the Bull Exchange, Market Bulls, Best Penny Newsletter, Gain the Green, Insane Pennies, OTC Market Alerts, and Penny Players Club. While Paolucci was disseminating the email blasts, he was also coordinating with his co-schemers regarding the press releases being issued and the stock that they were selling. All of this coordination, however, was hidden from the market and the SEC. For example, Paolucci and his fellow schemers used offshore corporations and brokerage accounts, as well as fake corporations, intermediaries, and even fake names, causing tens of millions of dollars of losses to investors while gaining millions in profits for themselves.
“The United States’ securities laws exist to safeguard the integrity of the markets and to protect individual investors who play by the rules. Accordingly, they must be vigorously enforced,” said U.S. Attorney McSwain. “Schemers like Paolucci and his co-conspirators work hard to cover their tracks, while defrauding investors and harming our securities markets. But we will work even harder to track them down and bring them to justice.”
“Paolucci tricked people into investing under false pretenses, and those victims’ losses became his ill-gotten gains,” said Michael T. Harpster, Special Agent in Charge of the FBI’s Philadelphia Division. “While investors know they’re taking a chance when buying securities, they don’t anticipate the odds being stacked against them from the get-go. This case underscores the FBI’s commitment to protecting the investing public and bringing ‘pump and dump’ fraudsters to justice.”
The case was investigated by the Federal Bureau of Investigation - Philadelphia and Boston Field Offices, with assistance from the Securities and Exchange Commission Offices in Chicago and Boston, the U.S. Department of Justice's Office on International Affairs, the Alberta Securities Commission, and the United States Attorney's Office for the District of Massachusetts. It is being prosecuted by Assistant United States Attorneys Patrick Murray and Judy Smith.
Staten Island Man Admits Robbery, Identity Theft, and Defrauding Numerous Women and BusinessesRead the Press Release
NEWARK, N.J. – A Staten Island, New York, man has admitted robbing a New Jersey business owner in February 2019, defrauding eight New Jersey businesses from July 2016 through January 2019, and defrauding and stealing the identities of three women, U.S. Attorney Craig Carpenito announced today.
Raymond Scura, 30, pleaded guilty before Judge Claire C. Cecchi in Newark federal court on Dec. 9, 2019, to an information charging him with wire fraud affecting a financial institution, aggravated identity theft, and Hobbs Act robbery.
According to the documents filed in this case and statements made in court:
Scura used bad checks and stolen credit cards to obtain goods and services, such as a country club membership, limousine services, luxury hotel expenses, exotic car rentals, and a Rolex watch, in order to appear wealthy and obtain the confidence of his victims, often targeting women. Once he convinced his victims of his purported wealth, he would then steal their identities and accounts to make additional purchases. As a result of his fraud and aggravated identity theft offenses, Scura caused losses to individuals and businesses in excess of $250,000
In February 2019, Scura was a customer of an internet-based business owned and operated by a New Jersey man. To pay for the services of the business, Scura wrote at least one fraudulent check to the victim. When the victim insisted on cash payment, Scura drove with the business owner to a bank, where Scura brandished a gun, threatened to kill the victim, and demanded that the victim deposit a fraudulent check for $10,000 into the victim’s bank account and then withdraw $10,000. The victim did as Scura directed and then gave Scura the $10,000.
The Hobbs Act robbery charge carries a statutory maximum of 20 years in prison and a $250,000 fine, or twice the gain or loss from the offense. The wire fraud affecting a financial institution charge carries a statutory maximum of 30 years in prison, and the aggravated identity theft charge carries a mandatory minimum sentence of two years in prison, which must be served consecutively to any other sentenced imposed. Sentencing is scheduled for April 1, 2020.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, and members of the Belleville Police Department, under the direction of Chief of Police Mark Minichini, with the investigation leading to the guilty plea. He also thanked the Summit Police Department, the Union County Prosecutor’s Office, the Burlington County Prosecutor’s Office, and the Evesham Police Department for their assistance.
The government is represented by Assistant U.S. Attorneys Christopher Amore of the Organized Crime and Gangs Unit and Elaine Lou of the U.S. Attorney’s Office in Newark.
Defense counsel: Saverio Viggiano Esq., Assistant Federal Public Defender, Newark
Schenectady Man Sentenced to 135 Months for Role in Gun Store BurglaryRead the Press Release
ALBANY, NEW YORK – Jose Fontanez, age 38, of Schenectady, New York, was sentenced today to 135 months in prison for stealing, possessing, concealing, and storing firearms stolen from Target Sports, Inc., a federally licensed firearms dealer in Schenectady County.
The announcement was made by United States Attorney Grant C. Jaquith and John B. DeVito, Special Agent in Charge of the New York Field Division of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF).
United States District Judge Norman A. Mordue also sentenced Fontanez to a 3-year term of supervised release and ordered that he pay restitution of $48,775.47.
Fontanez, who has prior felony convictions for robbery and drugs, pled guilty on April 16, 2018. As part of his plea, Fontanez admitted that, on October 22, 2017, he and Christian Roman broke a window to gain entry into Target Sports and then removed dozens of firearms from the store, as well as ammunition and other property, making multiple trips to and from the store with the assistance of Dalmary Morales. Fontanez further admitted that, after making an inventory of the stolen firearms, the two men hid them in a storage unit in Schenectady and, while on the run from law enforcement, enlisted accomplices in Amsterdam, New York, and Rochester, New York, to help retrieve and transport them to various locations in New York. In exchange for their assistance, Fontanez and Roman provided some of the stolen firearms to their accomplices.
Christian Roman, age 25, of Schenectady, pled guilty in 2018 to stealing the firearms from Target Sports, and other, related charges. He was sentenced to 150 months in prison.
Omar DeJesus, age 32, and Onic Martinez, age 34, both of Amsterdam, pled guilty in 2018 for their roles in stealing, transporting and possessing the firearms. Both men were sentenced to 120 months in prison.
Dalmary Morales, age 24, of Schenectady, pled guilty in 2018 to stealing the firearms from Target Sports. She was sentenced to 57 months in prison.
Juan Saez, age 37, of Rochester, pled guilty in 2018 for his role in stealing, transporting and possessing the firearms. He is scheduled to be sentenced on March 20, 2020.
This case was investigated by the ATF, New York State Police, and the Glenville Police Department, and is being prosecuted by Assistant U.S. Attorney Wayne A. Myers.
Saint Paul Felon Sentenced to 94 Months in Prison for Heroin Distribution Conspiracy, Illegal Possession of FirearmsRead the Press Release
United States Attorney Erica H. MacDonald today announced the sentencing of DWIGHT CADARIUS LABON, 32, to 94 months in prison for conspiring to possess with intent to distribute and to distribute heroin and illegally possessing firearms. LABON, who pleaded guilty on August 27, 2019, was sentenced on December 9, 2019, before Judge Eric C. Tostrud in U.S. District Court in St. Paul, Minnesota.
According to the defendant’s guilty plea and documents filed in court, from approximately December 1, 2017, through November 30, 2018, LABON conspired to buy and sell heroin to individuals throughout the Twin Cities. On August 27, 2018, law enforcement executed a search warrant on a vehicle and recovered a loaded Ruger SR9 semi-automatic pistol, which was later determined to have been stolen. LABON acquired the Ruger from one of his heroin customers, with the assistance of his co-Defendant.
According to the defendant’s guilty plea and documents filed in court, on October 25, 2018, LABON entered the Chick N’ Chips restaurant in St. Paul, Minnesota, with a loaded Smith & Wesson 9mm semi-automatic pistol with an obliterated serial number. LABON dropped the loaded Smith & Wesson in a trash can before exiting the restaurant. LABON then met with one of his heroin customers and arranged for the customer to retrieve the Smith & Wesson in exchange for heroin. Because he has prior felony convictions in Hennepin and Ramsey Counties, LABON is prohibited under federal law from possessing firearms at any time.
This case was the result of an investigation conducted by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Minneapolis Police Department, the Hennepin County Sheriff’s Office, and the Saint Paul Police Department. This case was brought as part of Project Safe Neighborhoods (PSN), an initiative that brings together federal, state, and local law enforcement to combat violent crime. This case is also part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws.
Assistant U.S. Attorneys Samantha H. Bates and W. Anders Folk are prosecuting the case.
Defendant Information:
DWIGHT CADARIUS LABON, 32
St. Paul, Minn.
Convicted:
- Conspiracy to distribute and possess with intent to distribute heroin, 1 count
- Felon in possession of firearms, 1 count
Sentenced:
- 94 months in prison
- Four years of supervised release
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Rochester Music Teacher Charged with Production of Child PornographyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051ROCHESTER, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Philip M. Close, 42, of Rochester, NY, was arrested and charged by criminal complaint with production of child pornography. The charge carries a mandatory minimum penalty of 15 years in prison, a maximum of 30 years, and a $250,000 fine.
Assistant U.S. Attorney Meghan K. McGuire, who is handling the case, stated that the defendant owns the Close School of Music on West Ridge Road in the Town of Parma, which offers private music lessons to children and adults of all ages. Close has been teaching music lessons throughout New York State for over 20 years.
According to the complaint, on December 5, 2019, the Monroe County Sheriff’s Office received information from a mother with two children taking lessons at the Close School of Music, that a video camera was attached to the toilet in the bathroom. The parent indicated that earlier that day, while waiting for her child (Minor Victim 1) to finish her music lesson, she used the bathroom. While in the bathroom, the mother observed a small black camera lens facing towards the toilet seat, and a small metallic-looking piece hanging from a wire off of the toilet. The mother grabbed and pulled the wires and found a camera-device and wires taped to the bottom of the toilet with black electrical tape. After finding this camera device, she removed it from the bottom of the toilet, and proceeded to contact 911.
A Monroe County Sheriff’s deputy reported to the Close School of Music and spoke with the defendant who acknowledged that the device was his. Close was taken into custody.
On December 6, 2019, a search warrant was executed at the music school and multiple digital computing devices were seized, including a laptop computer. A preliminary review of the laptop located three videos of Minor Victim 1. One of the videos included Minor Victim 1 using the toilet. Another video shows Minor Victim 1 laying down on a piano bench and Close’s leg. The defendant is seen moving Minor Victim 1’s shirt up to expose her stomach and touching her stomach. Close then begins to touch other parts of Minor Victim 1’s body. Minor Victim 1 is seen sliding under the piano in what appears to be an attempt to prevent the defendant from touching any further.
The defendant made an initial appearance this afternoon before U.S Magistrate Judge Mark W. Pedersen and was held pending a detention hearing on December 17, 2019.
Members of the public who have specific information related to this case are asked to call the Monroe County Sheriff’s Office Tip-line at 1-585-753-4175.
The complaint is the result of an investigation by the Federal Bureau of Investigation, Child Exploitation Task Force, under the direction of Special Agent-in-Charge Gary Loeffert, the Monroe County Sheriff’s Office, under the direction of Sheriff Todd Baxter, and the Monroe County District Attorney’s Office, under the direction of District Attorney Sandra Doorley.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
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Poplar woman admits stabbing man in Wolf Point barRead the Press Release
GREAT FALLS – A Poplar woman today admitted assault charges for stabbing a man multiple times while in a bar in Wolf Point, on the Fort Peck Indian Reservation, U.S. Attorney Kurt Alme said.
Emily Kaye Marie Gourneau, 32, pleaded guilty to assault resulting in serious bodily injury. Gourneau faces a maximum penalty of 10 years in prison, a $250,000 fine and three years of supervised release.
U.S. District Judge Brian M. Morris presided and set sentencing for April 16, 2020. Gourneau was detained pending further proceedings.
The prosecution said in court records that the assault occurred on July 23 at the Water Hole 1 bar in Wolf Point. Gourneau and the victim, who was playing pool, had been socializing. At some point, when the victim walked toward Gourneau from the pool table, Gourneau pulled out a knife and stabbed the victim multiple times, running around the bar chasing after him. The assault was recorded on a security camera. Gourneau left the bar after the assault.
First responders found the victim lying on the floor and severely wounded and bleeding. The victim underwent surgery for multiple stab wounds at a hospital in North Dakota.
Assistant U.S. Attorney Cassady Adams is prosecuting the case, which was investigated by the FBI, Wolf Point Police Department and the Fort Peck Tribes’ Criminal Investigation.
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Operation Results in Federal Indictment Against Five Defendants in Drug Trafficking ConspiracyRead the Press Release
United States Attorney Brandon J. Fremin announced today that a lengthy federal investigation into an extensive drug trafficking network based in Plaquemine, Louisiana, has resulted in the return of a grand jury indictment charging five (5) individuals with narcotics and firearms-related offenses. As discussed in more detail below, the defendants are charged with conspiring to distribute and to possess with the intent to distribute cocaine and cocaine base and some of the defendants are charged with firearm-related offenses.
The charged defendants are listed below, and each faces significant terms of imprisonment, fines, and the forfeiture of proceeds from the illegal activity:
- Larry Hughes, age 60, of Baton Rouge, Louisiana, is charged with conspiracy to distribute and to possess with intent to distribute 500 grams or more of cocaine and 28 grams or more of cocaine base, and possession of a firearm in furtherance of a drug trafficking offense.
- Eric J. Curtis, age 43, of Baton Rouge, Louisiana, is charged with conspiracy to distribute and to possess with intent to distribute 500 grams or more of cocaine and 28 grams or more of cocaine base.
- Alexander J. Brock, Jr., age 54, of Baton Rouge, Louisiana, is charged with conspiracy to distribute and to possess with intent to distribute 500 grams or more of cocaine and 28 grams or more of cocaine base.
- Malcolm J. Jackson, age 47, of Baton Rouge, Louisiana, is charged with conspiracy to distribute and to possess with intent to distribute 500 grams or more of cocaine and 28 grams or more of cocaine base, possession of a firearm in furtherance of a drug trafficking offense, and felon in possession of a firearm.
- Shaheed Thompson, age 33, of Plaquemine, Louisiana, is charged with conspiracy to distribute and to possess with intent to distribute 500 grams or more of cocaine and 28 grams or more of cocaine base.
U.S. Attorney Brandon J. Fremin stated, “This indictment is another example of how coordinated efforts between federal and local law enforcement can remove organized drug traffickers from our streets and protect our communities from their poisonous products. I want to thank our prosecutor, the FBI Capitol Area Gang Task Force, the Iberville Parish Sheriff’s Office, along with ATF, DEA, U.S. Marshal’s Service, and East Baton Rouge Parish Sheriff’s Office for their tremendous work on this case.”
FBI New Orleans Division Special Agent in Charge Bryan A. Vorndran stated, “Whether in a major city, or a small town like Plaquemine, the FBI is focused on public safety and the welfare of our communities. As a result of this joint investigation between the FBI Baton Rouge Capital Area Gang Task Force, Iberville Parish Sheriff’s Office, ATF, DEA, U.S. Marshal’s Service, and East Baton Rouge Sheriff’s Office, a significant amount of illegal narcotics and weapons are off the streets. The FBI New Orleans Field Office will continue to work with our law enforcement partners to aggressively investigate drug and gang activity, as well as violent crime affecting our Louisiana neighborhoods.”
Iberville Parish Sheriff Brett Stassi stated, “I’m very proud of our partnership with U.S. Attorney Fremin. When he took office he made a commitment to join me in protecting the people of Iberville Parish. This indictment is another great step in fulfilling that promise. We look forward to future activities between our offices.”
This matter is being investigated by the Federal Bureau of Investigation Baton Rouge Capitol Area Gang Task Force and the Iberville Parish Sheriff’s Office and is being prosecuted by Assistant United States Attorney Jamie A. Flowers, Jr.
The investigation that led to this indictment is another effort by the Organized Crime Drug Enforcement Task Force (OCDETF) Program that was established in 1982 to mount a comprehensive attack against organized drug traffickers. Today, the OCDETF Program is the centerpiece of the United States Attorney General’s drug strategy to reduce the availability of drugs by disrupting and dismantling major drug trafficking organizations and money laundering organizations and related criminal enterprises. The OCDETF Program operates nationwide and combines the resources and unique expertise of numerous federal, state, and local agencies in a coordinated attack against major drug trafficking and money laundering organizations.
NOTE: An indictment is an accusation by a grand jury. The defendants are presumed innocent until and unless adjudicated guilty at trial or through a guilty plea.
Ocean Springs Man Sentenced on Drug ChargesRead the Press Release
Gulfport, Miss – Robert Benjamin Jones, 33 of Ocean Springs, was sentenced today by Senior U.S. District Judge Louis Guirola, Jr. to 23 months in federal prison for conspiracy to possess with intent to distribute controlled substances, announced U.S. Attorney Mike Hurst and Special Agent in Charge Jere T. Miles with Immigration and Customs Enforcement’s Homeland Security Investigations in New Orleans.
Jones was on supervised release for a prior possession with intent to distribute charge when United States Postal authorities found Schedule III and IV narcotics shipped to him from Serbia. On June 27, 2018, agents made a controlled delivery of the drugs to the home Jones was living in with his girlfriend and child. Jones spotted the agents while coming home from work and turned away. Agents seized cash, digital scales, pills, liquid steroids and electronic devices from the home. The devices showed Jones used the internet and had been obtaining the drugs from several foreign countries as far back as 2017. The following day, June 28, 2018, four additional international packages of pills addressed to Jones were seized at the Ocean Springs Post Office.
Jones was convicted of the same offense in 2015 and was on supervised release at the time of his arrest. Jones was revoked and sentenced to an additional 36 months on the 2015 case, the 23 months in the 2018 case were ordered to be served consecutively by Judge Guirola. Following completion of his prison terms Jones will have 3 years of supervised release.
The case was investigated by the United States Postal Service and Homeland Security Investigations. The case was prosecuted by Assistant United States Attorney Annette Williams.
North Carolina Man Pleads Guilty to Federal Firearms Charge for the 2002 Murder of an Employee of an Upper Marlboro BusinessRead the Press Release
Greenbelt, Maryland – Levy Steven Moore, age 49, of Pollocksville, North Carolina, pleaded guilty today in U.S. District Court in Maryland to the federal charge of murder resulting from using, carrying, brandishing, and discharging a firearm during and in relation to a crime of violence.
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; Chief Henry P. Stawinski III of the Prince George’s County Police Department; and Prince George’s County Sheriff Melvin C. High.
According to his plea agreement, on October 25, 2002, Moore and at least one accomplice planned to rob the victim-employee of the cash belonging to a business where the victim worked. As part of his duties, the victim-employee deposited the business’ cash proceeds and obtained money to be used in the operation of the business at a bank in Capitol Heights, Maryland.
As detailed in his plea agreement, Moore and his accomplice drove to the business and waited outside for the victim-employee to leave with the cash deposit. Moore was armed with a firearm and his accomplice was driving their vehicle as they followed the victim-employee from the business in Upper Marlboro, Maryland to the bank in Capitol Heights. The victim-employee made the deposit and was returning to his car with a money bag containing $2,200, which represented the business’ daily operating funds, when he was confronted by Moore. Moore attempted to take the money bag from the victim and shot the victim, who collapsed to the ground. The victim sustained a gunshot wound to the left side of the base of the neck, which caused his death. Moore admitted that he took the money bag, then got into the getaway vehicle driven by his accomplice. According to the plea agreement, while fleeing the scene the robbers struck the victim’s vehicle, ran over the victim, and left the dying victim lying in the bank parking lot.
Moore faces a maximum sentence of life in prison. U.S. District Judge Paul W. Grimm has scheduled sentencing for June 29, 2020, at 9:30 a.m. Moore remains detained.
United States Attorney Robert K. Hur commended the FBI, the Prince George’s County Police Department, and the Prince George’s County Sheriff’s Office for their work in the investigation. Mr. Hur thanked Assistant U.S. Attorneys William D. Moomau and Gregory D. Bernstein, who are prosecuting the case.
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North Carolina Man Charged with Committing 3 Murders in Connecticut in November 2015Read the Press Release
United States Attorney John H. Durham, New Haven State’s Attorney Patrick Griffin, Special Agent in Charge Brian C. Turner of the New Haven Division of the Federal Bureau of Investigation, Hamden Police Chief John Cappiello and New Haven Police Chief Otoniel Reyes today announced that a federal grand jury in New Haven returned an indictment yesterday charging EDWARD MICHAEL PARKS, also known as “Lee” and “Trouble,” 33, of Raleigh, North Carolina, with kidnapping and murdering two individuals in Hamden, and killing a third victim in New Haven to stop him from advising law enforcement what had occurred.
As alleged in statements made in court, on November 16, 2015, Parks was in an apartment on Shelton Avenue in New Haven to conduct an illegal sale of firearms. Damian Connor and Tamar Lawrence were also present in the apartment. When another individual left the apartment with firearms that he had not paid for, Parks, who was armed, held Connor and Lawrence against their will. Parks collected money and valuables from Connor and Lawrence, and then forced them to travel in Connor’s car to Hamden where Connor said he could get more money. They were followed in another vehicle by Devante Williams and another individual. After the vehicles arrived at 676 Mix Avenue in Hamden, Parks shot and killed Connor and Lawrence. Parks then left the scene with Williams and others in the second vehicle and returned to New Haven.
It is further alleged that, when Parks appeared to believe that Williams was anxious about the murders of Connor and Lawrence, Parks shot and killed Williams in the area of Sherman Court in New Haven.
The indictment charges Parks with two counts of kidnapping resulting in death, and one count of witness tampering by killing. If convicted of the charges, Parks faces a maximum term of imprisonment of life, or death if the government seeks the death penalty in this matter.
Parks is currently incarcerated in federal custody following an unrelated conviction for drug and firearm offenses in the Eastern District of North Carolina.
“This prosecution represents a tragic example of how lives can be ruined when firearms are illegally possessed and traded,” said U.S. Attorney Durham. “I thank our partners in the FBI, Hamden Police Department, New Haven Police Department and New Haven State’s Attorney’s Office for their collaborative work in bringing to justice an individual we allege to be responsible for three cold-blooded killings.”
“This case is a great example of the results obtained from cooperative efforts between federal, state and local law enforcement agencies,” said State’s Attorney Griffin.
“The investigation by the Hamden and New Haven police departments into these horrific murders has resulted in justice being served, and today our community is safer for it,” said FBI Special Agent in Charge Turner.
“I would like to thank the families of the victims for their patience and trust,” said Hamden Chief Cappiello. “I hope this indictment gives them some sense of peace and closure. I would also like to thank New Haven Detective Sergeant Bertram Ettienne, Hamden Detective Jomo Crawford, the FBI Safe Street Violent Task Force and the Offices of the U.S. Attorney and New Haven State’s Attorney. This case demonstrates that by working together we were able to get a violent individual off the streets.”
“Today, after 4 years of an in-depth homicide investigation, the New Haven Police Department and our law enforcement partners are able to bring justice to the family of Devante Williams,” said New Haven Assistant Chief Karl Jacobson. “We would like to extend a special thank you to the Williams family for their patience and understanding while investigators worked diligently to make this day a reality. We would also like to thank our law enforcement partners, the New Haven Police homicide detectives, Hamden Police homicide detectives, U.S Attorney’s Office, New Haven State’s Attorney’s Office, Federal Bureau of Investigation and the Department of Correction as justice would not have prevailed without them.”
U.S. Attorney Durham stressed that an indictment is only a charge and 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 investigation is being conducted by the Federal Bureau of Investigation, the Hamden Police Department and New Haven Police Department.
The case is being prosecuted by Assistant U.S. Attorneys Anthony E. Kaplan, Peter D. Markle and Jocelyn C. Kaoutzanis, and Assistant State’s Attorney Seth Garbarsky, who has been cross-designated as a Special Assistant U.S. Attorney in this matter.
Niagara Falls Man Arrested on Child Pornography ChargeRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Carl Anthony, 66, of Niagara Falls, NY, was arrested and charged by criminal complaint with attempted production of child pornography. The charge carries a mandatory minimum penalty of 15 years in prison, a maximum of 30 years, and a $250,000 fine.
Assistant U.S. Attorney Charles M. Kruly, who is handling the case, stated that according to the complaint, on June 19, 2019, Town of Niagara Police received a complaint regarding a now-13 year old female (Minor Victim) who had been surreptitiously video recorded while changing and showering. The defendant was identified as the individual responsible for making the recording.
On July 9, 2019, a federal search warrant was executed at Anthony's Niagara Falls residence. A hard drive that was seized during the execution of the search warrant was found to contain two videos, both of which showed the Minor Victim changing and showering in a bathroom.
The defendant made an initial appearance before U.S. Magistrate Judge Michael J. Roemer. Subject to a home inspection, Anthony will be released on a number of conditions, including home detention.
The complaint is the result of an investigation by the Federal Bureau of Investigation, Buffalo Office, under the direction of Special Agent-in-Charge Gary Loeffert.
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New York Man Pleads Guilty to Providing Material Support to TerroristsRead the Press Release
St. Louis – Nihad Rosic, 31, of Utica, New York, pleaded guilty today to one count of conspiring to provide material support to terrorists and one count of providing material support to terrorists. Rosic appeared today before Judge Catherine D. Perry who accepted his plea and set his sentencing for April 16, 2020.
Also charged in the indictment are: Ramiz Zijad Hodzic, his wife Sedina Unkic Hodzic, and Armin Harcevic, all of St. Louis County, Missouri, and Mediha Medy Salkicevic, of Schiller Park, Illinois. All defendants were charged and convicted of conspiring to provide material support and resources to terrorists.
According to court documents, Nihad Rosic, agreed with co-defendant Ramiz Hodzic and others that they would provide material support, that being money and materials identified in the indictment, to Abdullah Ramo Pazara and others who engaged in combat against various entities and personnel in Syria and elsewhere. Such combat necessarily involved the unlawful, willful, deliberate, and premeditated killing of persons abroad. In May 2014, Defendant Rosic communicated directly with Pazara concerning Defendant Rosic’s plans to travel to Syria, meet Pazara, and join him in combat against various persons and entities in Syria.
“Nihad Rosic tried twice to travel to Syria to fight with terrorists,” said Special Agent in Charge Richard Quinn of the FBI St. Louis Division. “On both occasions he was prevented from doing so by the FBI Joint Terrorism Task Force. He will now be held accountable for providing assistance to terrorists.”
Rosic faces up to 15 years imprisonment and/or fines of up to $250,000, per count. In determining the actual sentence, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
Assistant Attorney General Demers and U.S Attorney Jensen commended the St. Louis FBI and all of the Joint Terrorism Task Force Joint partners for their commitment and tenacity in a lengthy and complex investigation as well as their dedication to this successful prosecution.
This case was investigated by the St. Louis FBI’s Joint Terrorism Task Force, U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), U.S. Postal Inspection Service, St. Louis Metropolitan and St. Louis County Police Departments. The case is being prosecuted by Assistant U.S. Attorneys Matthew Drake, Howard Marcus and Kenneth Tihen of the Eastern District of Missouri and Assistant United States Attorney Stephen Green of the United States Attorney’s Office in the Northern District of New York.
New York Man Pleads Guilty to Providing Material Support to TerroristsRead the Press Release
Nihad Rosic, 31, of Utica, New York, pleaded guilty today to one count of conspiring to provide material support to terrorists and one count of providing material support to terrorists. Rosic appeared today before Judge Catherine D. Perry who accepted his plea and set his sentencing for April 16, 2020.
Also charged in the indictment are: Ramiz Zijad Hodzic, his wife Sedina Unkic Hodzic, and Armin Harcevic, all of St. Louis County, Missouri, and Mediha Medy Salkicevic, of Schiller Park, Illinois. All defendants were charged and convicted of conspiring to provide material support and resources to terrorists.
According to court documents, Rosic, agreed with co-defendant Ramiz Hodzic and others that they would provide material support, that being money and materials identified in the indictment, to Abdullah Ramo Pazara and others who engaged in combat against various entities and personnel in Syria and elsewhere. Such combat necessarily involved the unlawful, willful, deliberate, and premeditated killing of persons abroad. In May 2014, Rosic communicated directly with Pazara concerning Rosic’s plans to travel to Syria, meet Pazara, and join him in combat against various persons and entities in Syria.
Rosic faces up to 15 years imprisonment and/or fines of up to $250,000, per count. In determining the actual sentence, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
Assistant Attorney General Demers and U.S Attorney Jensen commended the St. Louis FBI and all of the Joint Terrorism Task Force Joint partners for their commitment and tenacity in a lengthy and complex investigation as well as their dedication to this successful prosecution.
This case was investigated by the St. Louis FBI’s Joint Terrorism Task Force, U.S. Immigration and Customs Enforcement (ICE), Homeland Security Investigations (HSI), U.S. Postal Inspection Service, St. Louis Metropolitan and St. Louis County Police Departments. The case is being prosecuted by Assistant U.S. Attorneys Matthew Drake, Howard Marcus and Kenneth Tihen of the Eastern District of Missouri and Assistant U.S. Attorney Stephen Green of the U.S. Attorney’s Office in the Northern District of New York.
New Jersey Man, Avowed Member of White Supremacist Group, Pleads Guilty to Making False StatementsRead the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced that Fred Arena, 41, of Salem, NJ, entered a plea of guilty before United States District Court Judge John R. Padova on charges of making false statements to government agents. Arena, who was an employee of a federal contractor at the Philadelphia Navy Yard and as such was required to obtain a federal security clearance, lied to obtain the clearance. He also subsequently lied to federal investigators who asked him about his answers to questions on the security clearance paperwork. He was arrested and detained in October 2019, and is currently in federal custody.
On January 10, 2019, Arena completed the standard Form SF-86 to obtain a federal security clearance for his employment. On that form, he was required to disclose whether he had ever been a member of an organization that used (or advocated the use of) force or violence to prevent others from exercising their constitutional rights. He falsely answered that he had not. In fact, Arena was an avowed member of Vanguard America, a white supremacist group that fits that description. On the same application, Arena was asked whether he had property repossessed within the past seven years. He falsely answered that he had not. In fact, Arena had previously defaulted on a car loan, and his car was repossessed within the seven year window.
“Lying on federal security clearance forms and to government agents will land you in big trouble,” said U.S. Attorney McSwain. “And the nature of Arena’s deception – attempting to conceal his affiliation with a white supremacist group in order to obtain employment with a federal contractor – is extremely disturbing. Furthermore, no employee working for the federal government in any capacity has any business being a member of a white supremacist group or espousing white supremacist views. Employees paid with American taxpayer dollars are held to the highest standards so as to ensure their commitment to serve the public in a fair, lawful manner.”
“Joining a group that espouses extremist ideology is not itself illegal — but lying to the FBI certainly is,” said Michael T. Harpster, Special Agent in Charge of the FBI's Philadelphia Division. “Arena lied about his history to obtain a security clearance he never should’ve had. He then lied to the federal agents who questioned him about it. If the people we interview think they can deceive us without consequence, vital investigations will be stymied and our justice system sorely compromised.”
The case was investigated by the Federal Bureau of Investigation – Joint Terrorism Task Force, the Defense Counterintelligence and Security Agency, the Gloucester County Prosecutor’s Office, the Salem County Prosecutor’s Office, the New Jersey State Police, the Camden County Police Department, the Naval Criminal Investigative Service (NCIS), and the New Jersey Office of Homeland Security and Preparedness, with assistance from the Philadelphia Police Department, and is being prosecuted by Assistant United States Attorney for the Eastern District of Pennsylvania Joseph LaBar and Assistant United States Attorney for the District of New Jersey Martha Nye.
New Castle Woman Sentenced for Defrauding Social SecurityRead the Press Release
PITTSBURGH, PA- A resident of New Castle, PA, has been sentenced in federal court to three years’ probation and must pay $26,917.55 in restitution to the Social Security Administration on her conviction of charges related to Social Security fraud, United States Attorney Scott W. Brady announced today.
United States District Judge Marilyn J. Horan imposed the sentence on Shawna Stelter, 37.
According to information presented to the court, Stelter failed to disclose that her husband was part of her household when applying for and receiving Supplemental Security Income ("SSI") benefits, and, as a result, received $26,917.55 in SSI benefits to which she knew she was not entitled, from June of 2014 to September of 2016. The court was further informed that Stelter made a false statement on her Redetermination Summary on October 30, 2014, when she further claimed that her husband was not part of her household, and that her household only consisted of herself and her two children.
Assistant United States Attorney Christy C. Wiegand prosecuted this case on behalf of the government.
The Social Security Administration, Office of the Inspector General conducted the investigation leading to prosecution of Stelter.
Natchez Man Sentenced to Prison under Project EJECT for Stealing Firearm from Licensed Firearms DealerRead the Press Release
Natchez, Miss. – Javonte Lamar Butler, 20, of Natchez, was sentenced today by Senior U.S. District Judge David C. Bramlette III to 15 months in prison, followed by 3 years of supervised release, for stealing a firearm from a business that is licensed to sell firearms, announced U.S. Attorney Mike Hurst and Kurt Thielhorn, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). Butler was also ordered to pay a $1500 fine and $359 in restitution to the victim.
On December 14, 2018, Butler visited Peddlers Antique Pawn and Salvage, a federally licensed reseller of firearms, located in Natchez, Mississippi. While a store employee assisted two other persons, Butler reached into a glass display case, removed a pistol, and left the store without lawfully purchasing it. Butler was indicted on June 14, 2019 for stealing a firearm from a business licensed to sell firearms. Butler pled guilty before Judge Bramlette on August 1, 2019.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and prosecuted by Assistant United States Attorney Bert Carraway.
This case is part of Project EJECT, an initiative by the U.S. Attorney’s Office for the Southern District of Mississippi under the U.S. Department of Justice’s Project Safe Neighborhoods (PSN). EJECT is a holistic, multi-disciplinary approach to fighting and reducing violent crime through prosecution, prevention, re-entry and awareness. EJECT stands for "Empower Justice Expel Crime Together." PSN is bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Former Attorney General Jeff Sessions 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.
NDTX Round-Up December 10Read the Press Release
On December 3, Severo Elizalde-Abelardo, 39, was sentenced to 33 years and 9 months in federal custody for conspiracy to distribute a controlled substance. Elizalde-Abelardo managed and directed multiple drug deals between his codefendants. He instructed his coconspirators to meet with customers and count the money. When his home was searched, officers found 13 kilograms of methamphetamine, a handgun, and 20 pounds of MSM. This case was investigated by the High Intensity Drug Trafficking Areas Program, Drug Enforcement Administration, Internal Revenue Service, Homeland Security Investigations, Fort Worth Police Department, and Dallas Sheriff Office and prosecuted by AUSA Phelesa Guy.
On December 3, Jerson Gutierrez-Ramos, 20, was sentenced to 39 years and 7 months in federal custody for racketeer influenced and corrupt organizations conspiracy. Gutierrez-Ramos was associated with the Irving Loco Salvatruchas clique. Gutierrez-Ramos and other gang members attacked two victims in their home, beating them with a metal bar and machete with the intent to kill. This is one example of ten different victims listed in court documents that Gutierrez-Ramos attacked in order to increase his position within the gang. This case was investigated by Homeland Security Investigations, Immigration and Customs Enforcement, Irving Police Department, and Dallas Police Department, and prosecuted by AUSA Gary Tromblay.
On December 6, Desmond Howard Greer, 26, was sentenced to 10 years in federal custody for the possession of a firearm by a convicted felon. Greer was found to be in the possession of a multi-caliber rifle in violation of the terms of his prior conviction. This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and was prosecuted by AUSA John Boyle.
Mountain View Woman Indicted for Social Security Fraud, Identity TheftRead the Press Release
SPRINGFIELD, Mo. – A Mountain View, Missouri, woman who is currently a fugitive from justice has been indicted by a federal grand jury for a Social Security fraud scheme that utilized the stolen identity information of another person.
Laura A. Oglesby, 46, was charged in an eight-count indictment returned under seal by a federal grand jury in Springfield, Missouri, on Oct. 1, 2019. That indictment has been unsealed and made public in order to assist in her apprehension.
The public’s assistance is requested in locating Oglesby, who is a fugitive from justice. Individuals who have information regarding her whereabouts are encouraged to call the Social Security Administration, Office of Inspector General, at 855-829-8922.
The federal indictment alleges that on three separate occasions Oglesby fraudulently applied to receive a Social Security card by using the personal identity information of another person, which she claimed was her own. The indictment also alleges that Oglesby used a fraudulent Social Security number in a student account promissory note submitted to an educational institution (identified as “University A”). On each of those four occasions, the indictment alleges, Oglesby used the stolen identity information of another person.
Oglesby is charged with three counts of intentionally furnishing false information to the Social Security Administration, one count of the false representation of a Social Security number, and four counts of aggravated identity theft.
The charges contained in this indictment are simply accusations, and not evidence of guilt. Evidence supporting the charges must be presented to a federal trial jury, whose duty is to determine guilt or innocence.
This case is being prosecuted by Assistant U.S. Attorney Steven M. Mohlhenrich. It was investigated by Social Security Administration – Office of Inspector General and the Mountain View, Mo., Police Department.
Minneapolis Man Sentenced to 265 Months in Prison for Methamphetamine TraffickingRead the Press Release
United States Attorney Erica H. MacDonald today announced the sentencing of CARLOS MENDOZA SERRATO, 35, to 265 months in prison for conspiring to distribute methamphetamine. SERRATO, who pleaded guilty on July 9, 2019, was sentenced earlier today before Judge Joan N. Ericksen in U.S. District Court in Minneapolis, Minnesota.
According to the defendant’s guilty plea and documents filed in court, from at least June 2015 through October 2018, SERRATO acted as the facilitator and organizer of a drug trafficking organization. SERRATO conspired with his co-defendants and others to traffic methamphetamine and other controlled substances into and throughout Minnesota. In support of the organization, SERRATO delivered and arranged for the delivery of methamphetamine to his sub-distributors, collected funds, vehicles, and various other items from the sale of methamphetamine and other controlled substances. Throughout the course of the investigation into SERRATO’s drug trafficking organization, which affected multiple states, law enforcement seized more than 85 pounds of methamphetamine as well as additional quantities of cocaine, heroin, and marijuana.
This case was the result of an investigation conducted by Homeland Security Investigations, the Minneapolis Police Department, and the Drug Enforcement Administration.
Assistant U.S. Attorney Allen A. Slaughter is prosecuting the case.
Defendant Information:
CARLOS MENDOZA SERRATO, a/k/a “Michoacan,” a/k/a “Micho,” 35
Minneapolis, Minn.
Convicted:
- Conspiracy to distribute methamphetamine, 1 count
Sentenced:
- 265 months in prison
- Five years of supervised release
###
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Michigan man sentenced for drug distributionRead the Press Release
CLARKSBURG, WEST VIRGINIA – Delon Phillip Price, of Dearborn, Michigan, was sentenced today to 63 months incarceration for drug distribution, U.S. Attorney Bill Powell announced.
Price, also known as “Pedro,” age 28, pled guilty to one count of “Distribution of Heroin Within 1,000 Feet of a Protected Location” in August 2019. Price admitted to selling heroin near West Virginia University in November 2017.
Assistant U.S. Attorney Zelda E. Wesley prosecuted the case on behalf of the government. The Mon Metro Drug & Violent Crimes Task Force, a HIDTA-funded initiative, investigated.
Senior U.S. District Judge Irene M. Keeley presided.
Mexican citizen admits illegally transporting aliens from Canada into MontanaRead the Press Release
GREAT FALLS – A citizen of Mexico today admitted he illegally transported aliens for compensation after he was arrested in November in Glacier County by Border Patrol agents who were investigating suspected alien smuggling from Canada, U.S. Attorney Kurt Alme said.
Josue Bermudez-Lopez, 26, pleaded guilty to transportation of illegal aliens. Bermudez-Lopez faces a maximum 10 years in prison, a $250,000 fine and three years of supervised release.
U.S. District Judge Brian M. Morris presided and set sentencing for Feb. 13, 2020. Bermudez-Lopez was detained.
The prosecution said in court records filed in the case that on Nov. 17 at about 11:15 p.m., Border Patrol agents conducted traffic stops of two vehicles south of the United States-Canada border in Glacier County. In the first vehicle, which was a Chevrolet Suburban, the agent found the driver and nine passengers. All of the passengers admitted to being in the United States illegally. During the stop of the second vehicle, a Chevrolet Tahoe, all of the occupants ran into a nearby field. Agents found eight individuals within one to two minutes. Each of the individuals admitted to being in the United States illegally.
One of the persons caught in the field and seated on the ground against a Border Patrol vehicle was recognized as Bermudez-Lopez. Bermudez-Lopez initially denied his identity. An agent found nearby a discarded fanny pack that contained a Mexican passport with Bermudez-Lopez’s photo and name.
In all, law enforcement transported 19 suspects to the Sweetgrass Border Patrol Station for processing. Four of the transported illegal aliens told agents they had paid from $4,000 to $4,750 to be smuggled into the United States and identified two of Bermudez-Lopez’s co-defendants as a driver and a foot guide.
Bermudez-Lopez admitted to being in the United States illegally and to knowingly transporting illegal aliens for compensation on Nov. 17 and on a previous occasion.
Three co-defendants indicted with Bermudez-Lopez pleaded not guilty on Tuesday.
Assistant U.S. Attorneys Paulette Stewart, Jeff Starnes and Ethan Plaut are prosecuting the case, which was investigated by the U.S. Customs and Border Protection and the Glacier County Sheriff’s Office.
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Mexican Citizen Sentenced for Attempting to Deliver Methamphetamine Contained in Pizza BoxRead the Press Release
United States Attorney Joe Kelly announced that on December 9, 2019, Senior United States District Judge Laurie Smith Camp sentenced Hugo Lopez-Ortiz, of Mexico, to an 87-month term of imprisonment, to be served in the U.S. Bureau of Prisons. There is no parole in the federal system.
On August 25, 2018, DEA investigators became aware that Lopez-Ortiz would be delivering methamphetamine to a customer on behalf of a Mexican supplier at a Kicks gas station near Eppley Airfield. On August 26, 2018, Omaha Police Department officers approached Lopez-Ortiz as he stood in the parking lot of the gas station holding a pizza box. Lopez-Ortiz consented to a search of his person and of the items he was holding. Officers found close to 3½ pounds of methamphetamine within the pizza box and Lopez-Ortiz was arrested.
Investigators subsequently searched Lopez-Ortiz’s nearby hotel room and recovered more than $13,000.00 from under the bed, which was later forfeited. At sentencing, Lopez-Ortiz claimed that at the time of the offense, he was gainfully employed by the Ford Motor Company at a manufacturing facility in Hermosillo, Mexico. Travel records showed that Lopez-Ortiz had recently traveled to Omaha from Mexico.
Lopez-Ortiz will be removed from the United States by immigration authorities after completing his term of imprisonment.
The case was primarily investigated by the Drug Enforcement Administration – Omaha Field Division, the Omaha Police Department, and the Southwest Iowa Narcotics Task Force.
Mexican Alien with Involuntary Manslaughter Conviction Sentenced for Illegal ReentryRead the Press Release
RICHMOND, Va. – A Mexican national was sentenced today for six years in prison for illegally reentering the United States following removal after a felony conviction.
According to court documents and evidence presented at trial, Rodrigo Martinez-Mendoza, 43, first made illegal entry into the United States in 1993. In 1996 in Texas, he was convicted of forgery. Immigration authorities learned of the matter and commenced removal proceedings. Following processing, Martinez-Mendoza was then released on his own recognizance. In May 1997, Martinez-Mendoza failed to appear at his scheduled hearing, and was ordered deported to Mexico, and a warrant was issued. In August 2005, law enforcement encountered Martinez-Mendoza at Fort Lee Army Base in Petersburg, and he was then processed for deportation. In September 2005, Martinez-Mendoza was removed to Mexico at taxpayer expense. Thereafter on an unknown date, at an unknown location, he illegally returned to the United States.
“Martinez-Mendoza is a serious threat to public safety,” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “In addition to an involuntary manslaughter conviction for killing a man during a drunken fight, he has a criminal record that includes DWI, lying to the police, and he has illegally entered the United States on multiple occasions. The Department of Justice is committed to prioritizing criminal immigration enforcement, especially those like Martinez-Mendoza, who enter this country illegally only to commit further crimes. They will be held accountable, prosecuted, and removed.”
In October 2009, Martinez-Mendoza was arrested by officers of the ICE Fugitive Operations Team in Chester, and later pleaded guilty to illegal reentry and served four months before again being deported to Mexico at taxpayer expense. On an unknown date, Martinez-Mendoza illegally returned to the United States.
In December 2017, in Petersburg, Martinez-Mendoza was arrested by law enforcement officers from the U.S. Marshals Capital Area Regional Fugitive Task Force on state charges of felony malicious wounding. In October 2018, he was convicted of involuntary manslaughter in Richmond Circuit Court and sentenced to a term of five years in prison with four years suspended.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Russell Hott, Field Office Director for U.S. Immigration and Customs Enforcement’s (ICE) Enforcement and Removal Operations (ERO) Washington, D.C., made the announcement after sentencing by Senior U.S. District Judge Henry E. Hudson. Assistant U.S. Attorney S. David Schiller prosecuted the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:17-cr-164.
Menominee Man Receives 4-year Prison Sentence for Aggravated Assault and Illegal Firearms Possession on Menominee Indian ReservationRead the Press Release
Matthew D. Krueger, U.S. Attorney for the Eastern District of Wisconsin, announced that Jeremy Nunway (age: 40), a former resident of the Menominee Indian Reservation, received a sentence in separate cases in United States District Court for the Eastern District of Wisconsin in Green Bay. Nunway, an enrolled member of the Menominee Indian Tribe of Wisconsin, pleaded guilty on September 25, 2019, to Possession of a Firearm by a Prohibited Person, and Domestic Assault by Strangulation. At a hearing on December 5, 2019, United States District Judge William C. Griesbach imposed a total sentence of 48 months in prison, followed by 36 months on supervised release.
The investigation revealed that on October 9, 2018. Nunway possessed a loaded SKS 7.62x39mm rifle, which was in the defendant’s residence in a remote area of the Menominee Indian Reservation. A previous felony conviction prohibited Nunway from possession of a firearm. Officers with the Menominee Tribal Police Department and Menominee Conservation Department discovered the rifle while investigating a domestic violence incident involving Nunway and a Menominee woman.
On April 17, 2019, Nunway strangled and assaulted the same woman, with whom he was involved in a domestic relationship, while at a residence in Middle Village, which is on the Menominee Indian Reservation. The woman sustained injuries during the incident that required medical attention.
In sentencing Nunway, Judge Griesbach observed that in both incidents Nunway engaged in violent offenses, where Nunway was “abusive and brutal to others,” which required punishment. Judge Griesbach also observed the need to deter others who might consider engaging in violence against women, or in similar actions despite legal prohibitions against possessing firearms.
The Menominee Tribal Police Department and Federal Bureau of Investigation investigated the case. It was prosecuted by Assistant United States Attorney Andrew J. Maier.
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Men Sentenced to Prison for Conspiring to Introduce Narcotics to Federal Prison in Butner, North CarolinaRead the Press Release
NEW BERN – United States Attorney Robert J. Higdon, Jr., announced that United States District Judge Louise W. Flanagan sentenced federal inmate CHARLIE MORGAN to a 15-month term of imprisonment followed by a 3-year term of supervised release for conspiracy to distribute and possess with intent to distribute the opiate Buprenorphine, commonly referred to by the brand name Suboxone. The 15-month term was in addition to, and consecutive to MORGAN’S 24-month term of imprisonment imposed for violation of his supervised release for this crime. Judge Flanagan previously sentenced co-defendant JEFFREY NEWKIRK to a term of 12 months and 1 day imprisonment to run consecutive to his current federal sentence. NEWKIRK also received a 3-year term of supervised release.
Beginning in November 2017, MORGAN, who was on supervised release at the time, and then-federal-inmate NEWKIRK began to communicate with the purpose of introducing contraband into the Federal Correctional Complex in Butner, North Carolina (“FCC Butner”). The contraband in question was Buprenorphine, a Schedule III Controlled Substance. Based on information obtained from monitoring the communications, on December 6, 2017, the FCC Butner mailroom intercepted a package mailed to NEWKIRK containing 25 photographs. Upon further inspection of the package, staff discovered two stacks of orange colored film. Pharmacy staff identified the film as Buprenorphine.
Mr. Higdon commented: “The introduction of drugs and contraband into federal correctional institutions is a nationwide concern. The safety and security of both staff and inmates are compromised when inmates have access to dangerous drugs and contraband. As such, the U.S. Attorney’s Office for the Eastern District of North Carolina is dedicated to pursuing prosecution of these introductions of contraband cases in addition to any discipline the Bureau of Prisons may impose.”
Special Assistant United States Attorney Michael Bredenberg represented the government in this case.
McKeesport Felon Charged with Illegally Possessing AmmunitionRead the Press Release
PITTSBURGH, PA - A resident of McKeesport, Pennsylvania, has been indicted by a federal grand jury in Pittsburgh on a charge of violating federal firearms laws, United States Attorney Scott W. Brady announced today.
The one-count Indictment named Curtis Farrar, age 29, as the sole defendant.
According to Indictment, on or about November 19, 2019, Farrar, a convicted felon, was found to be in possession of 20 rounds of 9mm ammunition. Federal law prohibits a convicted felon from possessing a firearm and/or ammunition..
The law provides for a maximum total sentence of not more than ten years in prison, a fine of not more than $250,000.00 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Brendan T. Conway and Brian M. Czarnecki are prosecuting this case on behalf of the government.
The Federal Bureau of Investigation, Monroeville Police Department, the Attorney General’s Office, the Drug Enforcement Agency’s Maryland Office, and the Allegheny County Police Department conducted the investigation leading to the Indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Marketing Executive for Two Global Companies Sentenced to 41 Months in Federal Prison for Defrauding Her Employers, Resulting in Losses of More Than $855,000Read the Press Release
Greenbelt, Maryland – U.S. District Judge Peter J. Messitte today sentenced Rebecca Jelfo, age 47, of Silver Spring, Maryland, to 41 months in federal prison, followed by three years of supervised release, for a federal wire fraud charge in related to a scheme Jelfo executed to defraud two employers of a total of at least $855,000 by submitting fraudulent and inflated invoices. Judge Messitte also ordered Jelfo to forfeit any proceeds or property obtained as a result of the scheme, and to pay restitution in the full amount of the loss, which is $855,587.25.
The sentence was announced by United States Attorney for the District of Maryland Robert K. Hur and Special Agent in Charge Jennifer C. Boone of the Federal Bureau of Investigation, Baltimore Field Office.
According to her plea agreement, from approximately 2008 until December 2015, Jelfo was Head of Marketing and Communications for the Americas for Company A, a global airline. Between January 4, 2016 and January 31, 2018, Jelfo was a Senior Director of Luxury Brand Marketing – Partnerships and Promotions for Company B, a global hospitality company. As part of Jelfo’s duties at both companies, she contracted with marketing vendors and was responsible for approving certain marketing invoices.
Jelfo admitted that beginning while she was employed at Company A and continuing throughout her employment with Company B, Jelfo participated in an over-invoicing scheme designed to defraud her employers. Specifically, Jelfo submitted or caused to be submitted, false and inflated invoices purported to be for various marketing services or products provided to her employer. Jelfo knew that the invoices did not accurately reflect the products or services provided by the vendors, but nevertheless took steps to make sure that Company A and Company B paid the false invoices. After the companies paid the invoices, Jelfo instructed the vendors to remit payments to cover her personal debts.
As detailed in her plea agreement, Jelfo instructed three separate vendors to remit payments to cover her personal expenses. Specifically, from as early as May 21, 2015 through August 24, 2016, Vendor A remitted payments for Jelfo’s personal expenses totaling $263,697, including a $13,000 payment to Jelfo’s Neiman Marcus credit card account and a $28,000 payment to Jelfo’s Saks Fifth Avenue credit card account. Vendor A also purchased $15,000 in American Express gift cards, some of which Jelfo used to make purchases at a high-end furniture store in Washington, D.C.
Similarly, while employed by Company B, Jelfo submitted false invoices purporting to come from Vendor B. After Company B paid the invoices to Vendor B, Vendor B remitted payments to Jelfo’s personal credit card accounts. For example, on November 14, 2017, Vendor B sent $106,302 to Jelfo’s American Express account, which was received from Company B as part of two fraudulently inflated invoices. On at least one occasion, Jelfo instructed Vendor C to submit an inflated invoice to Company B and provided Vendor C with fraudulent documentation that appeared to justify the inflated invoice. Based on Jelfo’s request, Vendor C sent an invoice to Company B requesting a payment of $74,880. After receiving the payment from Company B, Vendor C made a $64,851.24 payment to Jelfo’s personal credit card account, as instructed by Jelfo.
Jelfo admitted that between May 21, 2016 and January 31, 2018, she stole at least $855,587.25 from Company A and Company B as a result of this scheme.
United States Attorney Robert K. Hur commended the FBI for its work in the investigation and thanked investigators from the victim companies for their assistance. Mr. Hur thanked Assistant U.S. Attorneys Erin B. Pulice and Gregory D. Bernstein, who prosecuted the case.
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Man from Roswell sentenced to 207 months in prison for firearm and drug offenses after shooting at police following high-speed chase in 2017Read the Press Release
ALBUQUERQUE, N.M. – Jose Manuel Diaz-Montelongo, 32, of Roswell, New Mexico was sentenced yesterday in federal court to 207 months in prison for discharging a firearm during a drug trafficking crime and possession with intent to distribute methamphetamine.
Diaz-Montelongo pleaded guilty to these offenses on February 21, 2018. According to public court documents, Diaz-Montelongo led police officers in Roswell on a high-speed chase on September 24, 2017. Diaz-Montelongo then barricaded himself inside his car for more than two hours before fleeing to a rifle range where he used a berm as cover while shooting at police officers and deputy sheriffs with an assault rifle. Diaz-Montelongo eventually surrendered to law enforcement. Police recovered the assault rifle, two pistols, and about 54.6 grams of methamphetamine from the scene.
Homeland Security Investigations investigated this case with assistance from the New Mexico State Police, Roswell Police Department, and Chaves County Sheriff’s Office. Assistant U.S. Attorney Aaron O. Jordan of the Las Cruces Branch Office prosecuted the case.
Lincoln Man Sentenced for CyberstalkingRead the Press Release
United States Attorney Joe Kelly announced that Alec Eiland, 20, of Lincoln, Nebraska, was sentenced December 5, 2019, in Lincoln to two years in prison by Chief United States District Judge John Gerrard for cyberstalking. In addition to his prison sentence, Eiland will be required to serve three years on supervised release.
In the fall of 2018, Eiland engaged in a social media campaign to terrorize two primary victims and their close family members. Eiland became fixated on the first victim when they were co-workers. When the victim did not return Eiland’s romantic interest, Eiland took the victim’s image and contact information and posted it online misrepresenting the victim as being interested in forced sexual encounters with strange men. The victim received numerous threats of sexual assault, and Eiland himself threatened to place a bomb in the victim’s vehicle. He invited the victim to kill herself to avoid being raped by himself and others. Eiland engaged in a pattern of surveillance on the victim’s residence and let the air out of the victim’s tires while the victim was at work one day. Eiland expanded his threats and harassment to the victim’s family, focusing on a young child in the family.
This case was investigated by the Federal Bureau of Investigation.
Lewis County Man Sentenced to 60 Months on Drug ConvictionsRead the Press Release
UTICA, NEW YORK – Derek Damuth, age 25, of Lowville, New York, was sentenced today to 60 months in prison by United States District Judge David N. Hurd based on his conviction for possessing with the intent to distribute in excess of 40 grams of a mixture of fentanyl and heroin, announced United States Attorney Grant C. Jaquith, Lewis County District Attorney Leanne K. Moser, Special Agent in Charge of United States Drug Enforcement Administration, New York Division (DEA) Raymond P. Donovan, and New York State Police Superintendent Keith Corlett. Damuth was also ordered to serve four years of supervised release following his release from prison.
As part of his guilty plea in this case, Damuth admitted that in November 2018, he possessed more than forty grams of a substance containing fentanyl, 17 ounces of marijuana, additional quantities of cocaine and heroin, and drug-trafficking paraphernalia. Damuth further admitted that he intended to distribute the drugs.
This case was investigated by the United States Drug Enforcement Administration (DEA) and the New York State Police, with assistance from the Lewis County District Attorney’s Office, and was prosecuted by Assistant U.S. Attorney Nicolas Commandeur.
Lead defendant pleads guilty in drug conspiracy that produced, distributed powerful synthetic opioidRead the Press Release
AUGUSTA, GA: A Georgia man who operated an industrial-scale illegal pill-manufacturing operation has admitted to the main charge in a drug trafficking conspiracy, representing the final guilty plea among the defendants.
Walker Christian Forrester, 25, of Loganville, Ga., entered a guilty plea in U.S. District Court in Augusta to Conspiracy to Possess with Intent to Distribute and to Distribute Controlled Substances (Carfentanil, Alprazolam and marijuana), said Bobby L. Christine, U.S. Attorney for the Southern District of Georgia.
The charge carries a penalty of up to life in prison, and there is no parole in the federal system.
“This drug trafficking conspiracy distributed massive amounts of dangerous illegal drugs, including deadly synthetic opioids, throughout the streets of Georgia and through the Dark Web,” said U.S. Attorney Christine. “Our federal, state and local law enforcement agencies did outstanding work in investigating and shutting down these merchants of misery and bringing them to justice, where substantial federal prison terms await.”
Other defendants who have pled guilty in the conspiracy are:
- Kolbie Hadden Watters, 23, of Augusta, Ga., who pled guilty to Conspiracy to Possess with Intent to Distribute and to Distribute Controlled Substances, and Possession of a Firearm in Furtherance of a Drug Trafficking Crime;
- Jonathan Britt Lester, 23, of Loganville, Ga.; who pled guilty to Conspiracy to Possess with Intent to Distribute and to Distribute Controlled Substances (Carfentanil, Alprazolam and marijuana);
- Armand Sananda Saedi, 28, of Atlanta, Ga., who pled guilty to Conspiracy to Possess with Intent to Distribute and to Distribute Controlled Substances (Alprazolam); and,
- Morgan McKenzie Slaton, 23, of Hoschton, Ga., who pled guilty to Conspiracy to Distribute and Possession with Intent to Distribute a Controlled Substance (Alprazolam).
According to court documents and testimony, the co-defendants participated in a drug conspiracy dating back to 2016 that imported large amounts of drugs purchased with cryptocurrency on the Dark Web, used industrial-grade machinery to manufacture pills, and sold the drugs on the Dark Web and throughout Georgia. At its peak, the operation produced as many as 200,000 pills per month, yielding profits of up to $18,000 per month.
Forrester first came to the attention of the U.S. Drug Enforcement Administration around Sept. 2017 after he purchased an industrial-grade pill press. Two months later, Forrester, Watters and a juvenile were arrested on state charges in Harlem, Ga., in November 2017 after a traffic stop in which Harlem police officers found more than 5,200 counterfeit Xanax pills, marijuana and a sawed-off shotgun in the vehicle.
In addition to charges in the drug conspiracy, Watters and Lester also face state charges in Walton County of felony murder and aggravated assault in the death of Chase David Loffler, 25, whose body was found buried in the backyard of Lester’s Loganville home in April 2018. The two are accused of beating and suffocating Loffler, a suspected co-conspirator, and burying his body in a shallow grave.
All six defendants face sentencing at a later date.
“Addressing the country’s opioid epidemic continues to be one of DEA’s top priorities,” said Robert J. Murphy, the Special Agent in Charge of the DEA Atlanta Field Division. This defendant ran an industrial illegal pill-manufacturing operation that delivered deadly doses of poison (namely synthetic opioids) to the community. DEA, its law enforcement partners and the U.S. Attorney’s Office will continue to deploy every available resource to stop such criminals like this defendant from distributing these dangerous and potentially deadly substances.”
“This case demonstrates the commitment of law enforcement agencies at every level to end an epidemic in our society that is killing our citizens,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “The fact that this defendant faces a potential life sentence is an example how serious this crime is and a warning to anyone else who might contemplate doing the same.”
“Dark Web purchases provide a false sense of anonymity to criminals who believe their actions will be invisible to law enforcement. These illegally imported pill presses, producing thousands of counterfeit pills an hour, can wreak havoc on a community,” said acting Special Agent in Charge Robert Hammer, who oversees Homeland Security Investigations (HSI) operations in Georgia and Alabama. “These guilty pleas are a testament to the resolve of the entire law enforcement community to combat the opioid crisis and get these dangerous pills off the streets.”
“The illegal manufacture and distribution of opioids can result in overdoses and deaths, fueling the national opioid crisis,” said Special Agent in Charge Justin D. Green, Food and Drug Administration (FDA) Office of Criminal Investigations Miami Field Office. “The FDA remains committed to working with our law enforcement partners to disrupt and dismantle illegal prescription drug manufacturing and distribution networks, including those that import illicit raw materials from overseas to make counterfeit drugs, and misuse the internet to distribute those drugs with reckless disregard of the risk to public health and safety.”
“Criminals need to clearly understand that law enforcement agencies across the globe work together daily to root out crime,” said Christopher Grey, spokesperson for the U.S. Army Criminal Investigation Command (CID). “We share information and continually support each other's investigations. There is no better example of that interagency cooperation than this case and how one piece of information led to more and more evidence to unravel this dangerous drug trafficking conspiracy.”
The case was investigated under the Organized Crime Drug Enforcement Task Forces (OCDETF), the premier U.S. Department of Justice program to dismantle multi-jurisdictional drug trafficking organizations. Agencies involved in the investigation include the FBI, the Drug Enforcement Administration (DEA), the U.S. Food and Drug Administration’s Office of Criminal Investigations (FDA-OCI), the Internal Revenue Service (IRS), the U.S. Army Criminal Investigative Command (CID), the U.S. Postal Inspection Service (USPIS), Homeland Security Investigations (HSI), the U.S. Marshals Service, and the Harlem Department of Public Safety. The case is being prosecuted for the United States by Assistant U.S. Attorney Patricia Rhodes.
Justice Department Announces Deferred Prosecution Agreement with HSBC Private Bank (Suisse) SARead the Press Release
Bank Admits to Helping U.S. Taxpayers Conceal Income and Assets from the United States;
Agrees to Pay $192.35 Million Penalty
MIAMI – HSBC Private Bank (Suisse) SA (HSBC Switzerland), a private bank headquartered in Geneva, has entered into a deferred prosecution agreement (DPA) with the Department of Justice today in the U.S. District Court for the Southern District of Florida, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Department of Justice’s Tax Division, United States Attorney for the Southern District of Florida Ariana Fajardo Orshan, and Chief Don Fort for Internal Revenue Service (IRS), Criminal Investigation. HSBC Switzerland admitted to conspiring with U.S. taxpayers to evade taxes and, as part of the agreement, HSBC Switzerland will pay $192.35 million in penalties.
“HSBC Switzerland conspired with U.S. accountholders to conceal assets abroad and evade taxes that every American must pay,” said Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Department of Justice’s Tax Division. “Banks, asset managers and other financial firms enable such crimes – and we will hold these institutions to account, right along with the taxpayers that use them to facilitate and disguise illegal activities.”
“Financial institutions that conspire with U.S. accountholders to hide income in undeclared bank accounts abroad, to avoid being held accountable for tax obligations and augment corporate profit, face substantial criminal and civil penalties for their illicit conduct,” said U. S. Attorney Fajardo Orshan for the Southern District of Florida. “In this case, HSBC Switzerland will pay a total civil and criminal fine of more than $192 million, to include a civil forfeiture of $71.8 million, for proceeds illegally derived from their conduct. We remain committed to the investigation and prosecution of individuals who evade their taxes and the financial institutions that assist them in doing so.”
“Taxpayers and financial institutions each have the most basic responsibilities to pay taxes and report suspicious activity regarding financial transactions. When financial institutions devise a massive tax evasion scheme and actually facilitate the activity, they not only must be held accountable, they must take actions to ensure this behavior will not happen again,” said Don Fort, Chief, IRS Criminal Investigation. “The integrity of our nation’s tax system depends on voluntary compliance and fair, consistent enforcement of the law. We owe it to all Americans to hold financial institutions accountable just as we would hold individual taxpayers accountable. Today’s DPA shows that engaging in this type of behavior has consequences.”
According to court documents, HSBC Switzerland admits that between 2000 and 2010 it conspired with its employees, third-party and wholly owned fiduciaries, and U.S. clients to: 1) defraud the United States with respect to taxes; 2) commit tax evasion; and 3) file false federal tax returns. In 2002, the bank had approximately 720 undeclared U.S. client relationships, with an aggregate value of more than $800 million. When the bank’s undeclared assets under management reached their peak in 2007, HSBC Switzerland held approximately $1.26 billion in undeclared assets for U.S. clients.
According to the terms of the DPA, HSBC Switzerland will cooperate fully with the Tax Division and the IRS. The DPA also requires HSBC Switzerland to affirmatively disclose information it may later uncover regarding U.S.-related accounts, as well as to disclose information consistent with the Department’s Swiss Bank Program relating to accounts closed between Jan. 1, 2009 and Dec. 31, 2017. Under the DPA, prosecution against the bank for conspiracy will be deferred for an initial period of three years to allow HSBC Switzerland to demonstrate good conduct. The agreement provides no protection for any individuals.
The $192.35 million penalty against HSBC Switzerland has three parts. First, HSBC Switzerland has agreed to pay $60,600,000 in restitution to the IRS, which represents the unpaid taxes resulting from HSBC Switzerland’s participation in the conspiracy. Second, HSBC Switzerland agreed to forfeit $71,850,000 to the United States, which represents gross fees (not profits) that the bank earned on its undeclared accounts between 2000 and 2010. Finally, HSBC Switzerland agreed to pay a penalty of $59,900,000. This penalty amount takes into consideration that HSBC Switzerland self-reported its conduct, conducted a thorough internal investigation, provided client identifying information to the Tax Division, and extensively cooperated in a series of investigations and prosecutions, as well as implemented remedial measures to protect against the use of its services for tax evasion in the future.
According to court documents filed as part of the DPA, the bank assisted U.S. clients in concealing their offshore assets and income from U.S. taxing authorities. To conceal its clients’ assets and income from the IRS, HSBC Switzerland employed a variety of methods, including relying on Swiss bank secrecy to prevent disclosure to U.S. authorities, using code-name and numbered accounts and hold-mail agreements, and maintaining accounts in the names of nominee entities established in tax haven jurisdictions, such as the British Virgin Islands, Liechtenstein, and Panama, that concealed the client’s beneficial ownership of the accounts.
In an effort to attract new U.S. clients, and maintain existing relationships with U.S. clients, HSBC Switzerland bankers took trips to the United States. Between 2005 and 2007, at least four HSBC Switzerland bankers traveled to the United States to meet at least 25 different clients. One banker also attended Design Miami, a major annual arts and design event in Miami, Florida, in an effort to recruit new U.S. clients to open undeclared accounts with HSBC Switzerland.
In early 2008, in response to a public U.S. criminal investigation into UBS AG, the largest bank in Switzerland, for tax and securities violations in connection with its maintaining undeclared accounts for U.S. clients, HSBC Switzerland began a series of policy changes to restrict its cross-border business with U.S. persons, but the bank did not immediately cease that business. In fact, some HSBC Switzerland bankers assisted clients in closing their accounts in a manner that continued to conceal their offshore assets, such as withdrawing the contents of their accounts in cash.
Acting Deputy Assistant Attorney General Goldberg, U.S. Attorney Fajardo Orshan, and Chief Fort commended special agents of IRS-Criminal Investigation, who investigated this case, as well as Senior Litigation Counsel Mark F. Daly, Assistant Chief Jason H. Poole, and Trial Attorney Grace E. Albinson of the Tax Division, who prosecuted this case. Acting Deputy Assistant Attorney General Goldberg and U.S. Attorney Fajardo Orshan also thanked Assistant U.S. Attorneys Thomas P. Lanigan and Danielle N. Croke of the Southern District of Florida, Assistant U.S. Attorney Gordon Kromberg of the Eastern District of Virginia, and agents with the United States Postal Service for their assistance in this case.
Justice Department Announces Deferred Prosecution Agreement with HSBC Private Bank (Suisse) SARead the Press Release
HSBC Private Bank (Suisse) SA (HSBC Switzerland), a private bank headquartered in Geneva, has entered into a deferred prosecution agreement (DPA) with the Department of Justice today in the U.S. District Court for the Southern District of Florida, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Department of Justice’s Tax Division, United States Attorney for the Southern District of Florida Ariana Fajardo Orshan, and Chief Don Fort for Internal Revenue Service (IRS), Criminal Investigation. HSBC Switzerland admitted to conspiring with U.S. taxpayers to evade taxes and, as part of the agreement, HSBC Switzerland will pay $192.35 million in penalties.
“HSBC Switzerland conspired with U.S. accountholders to conceal assets abroad and evade taxes that every American must pay,” said Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Department of Justice’s Tax Division. “Banks, asset managers and other financial firms enable such crimes – and we will hold these institutions to account, right along with the taxpayers that use them to facilitate and disguise illegal activities.”
“Financial institutions that conspire with U.S. accountholders to hide income in undeclared bank accounts abroad, to avoid being held accountable for tax obligations and augment corporate profit, face substantial criminal and civil penalties for their illicit conduct,” said U. S. Attorney Fajardo Orshan for the Southern District of Florida. “In this case, HSBC Switzerland will pay a total civil and criminal fine of more than $192 million, to include a civil forfeiture of $71.8 million, for proceeds illegally derived from their conduct. We remain committed to the investigation and prosecution of individuals who evade their taxes and the financial institutions that assist them in doing so.”
“Taxpayers and financial institutions each have the most basic responsibilities to pay taxes and report suspicious activity regarding financial transactions. When financial institutions devise a massive tax evasion scheme and actually facilitate the activity, they not only must be held accountable, they must take actions to ensure this behavior will not happen again,” said Don Fort, Chief, IRS Criminal Investigation. “The integrity of our nation’s tax system depends on voluntary compliance and fair, consistent enforcement of the law. We owe it to all Americans to hold financial institutions accountable just as we would hold individual taxpayers accountable. Today’s DPA shows that engaging in this type of behavior has consequences.”
According to court documents, HSBC Switzerland admits that between 2000 and 2010 it conspired with its employees, third-party and wholly owned fiduciaries, and U.S. clients to: 1) defraud the United States with respect to taxes; 2) commit tax evasion; and 3) file false federal tax returns. In 2002, the bank had approximately 720 undeclared U.S. client relationships, with an aggregate value of more than $800 million. When the bank’s undeclared assets under management reached their peak in 2007, HSBC Switzerland held approximately $1.26 billion in undeclared assets for U.S. clients.
According to the terms of the DPA, HSBC Switzerland will cooperate fully with the Tax Division and the IRS. The DPA also requires HSBC Switzerland to affirmatively disclose information it may later uncover regarding U.S.-related accounts, as well as to disclose information consistent with the department’s Swiss Bank Program relating to accounts closed between Jan. 1, 2009 and Dec. 31, 2017. Under the DPA, prosecution against the bank for conspiracy will be deferred for an initial period of three years to allow HSBC Switzerland to demonstrate good conduct. The agreement provides no protection for any individuals.
The $192.35 million penalty against HSBC Switzerland has three parts. First, HSBC Switzerland has agreed to pay $60,600,000 in restitution to the IRS, which represents the unpaid taxes resulting from HSBC Switzerland’s participation in the conspiracy. Second, HSBC Switzerland agreed to forfeit $71,850,000 to the United States, which represents gross fees (not profits) that the bank earned on its undeclared accounts between 2000 and 2010. Finally, HSBC Switzerland agreed to pay a penalty of $59,900,000. This penalty amount takes into consideration that HSBC Switzerland self-reported its conduct, conducted a thorough internal investigation, provided client identifying information to the Tax Division, and extensively cooperated in a series of investigations and prosecutions, as well as implemented remedial measures to protect against the use of its services for tax evasion in the future.
According to court documents filed as part of the DPA, the bank assisted U.S. clients in concealing their offshore assets and income from U.S. taxing authorities. To conceal its clients’ assets and income from the IRS, HSBC Switzerland employed a variety of methods, including relying on Swiss bank secrecy to prevent disclosure to U.S. authorities, using code-name and numbered accounts and hold-mail agreements, and maintaining accounts in the names of nominee entities established in tax haven jurisdictions, such as the British Virgin Islands, Liechtenstein, and Panama, that concealed the client’s beneficial ownership of the accounts.
In an effort to attract new U.S. clients, and maintain existing relationships with U.S. clients, HSBC Switzerland bankers took trips to the United States. Between 2005 and 2007, at least four HSBC Switzerland bankers traveled to the United States to meet at least 25 different clients. One banker also attended Design Miami, a major annual arts and design event in Miami, Florida, in an effort to recruit new U.S. clients to open undeclared accounts with HSBC Switzerland.
In early 2008, in response to a public U.S. criminal investigation into UBS AG, the largest bank in Switzerland, for tax and securities violations in connection with its maintaining undeclared accounts for U.S. clients, HSBC Switzerland began a series of policy changes to restrict its cross-border business with U.S. persons, but the bank did not immediately cease that business. In fact, some HSBC Switzerland bankers assisted clients in closing their accounts in a manner that continued to conceal their offshore assets, such as withdrawing the contents of their accounts in cash.
Acting Deputy Assistant Attorney General Goldberg, U.S. Attorney Fajardo Orshan, and Chief Fort commended special agents of IRS-Criminal Investigation, who investigated this case, as well as Senior Litigation Counsel Mark F. Daly, Assistant Chief Jason H. Poole, and Trial Attorney Grace E. Albinson of the Tax Division, who prosecuted this case. Acting Deputy Assistant Attorney General Goldberg also thanked Assistant U.S. Attorneys Thomas P. Lanigan and Danielle N. Croke of the Southern District of Florida, Assistant U.S. Attorney Gordon Kromberg of the Eastern District of Virginia, and agents with the U.S. Postal Service for their assistance in this case.