Latest Records
Newest first across public DOJ and U.S. Attorney press releases.
Friday 28 June 2019
San Diego Contractor Sentenced for Defrauding Federal Agencies, Agrees to Pay $3.2 Million to Resolve Civil AllegationsRead the Press Release
NEWS RELEASE SUMMARY – June 28, 2019
San Diego contractor Andrew Otero and his company A&D General Contracting were sentenced today in San Diego federal court by U.S. District Judge John A. Houston. In November, a federal jury convicted A&D and Otero of fraudulently obtaining over $11 million in government contracts which had been set aside for service-disabled veteran-owned small businesses (SDVOSBs).
Judge Houston sentenced Otero to 18 months in custody and ordered him to pay $400,000 in criminal fines. Judge Houston ordered A&D to pay $1.5 million in criminal fines, and imposed criminal forfeiture of $334,561.
Earlier this month, A&D and Otero settled civil False Claims Act allegations arising out of the same conduct, agreeing to pay the United States $3,259,679. Payment of the civil settlement amount will offset the criminal fines imposed by Judge Houston.
The evidence at trial proved that A&D and Otero created a fraudulent joint venture to secure government contract work. To appear qualified for SDVOSB contracts, Otero and veteran Roger Ramsey initially executed an agreement to create the joint venture, which stated that Ramsey’s company (Action Telecom) would manage the joint venture, employ a project manager for each of the set-aside contracts, and receive the majority of the profits.
However, as proved at trial, Otero and Ramsey signed a secret side agreement that made clear the joint venture was ineligible under the SDVOSB program. The side agreement proved the parties formed the joint venture so that A&D could simply “use the Disabled Veteran Status of Action Telecom” to bid on contracts. The side agreement stated that A&D – not Action Telecom – would run the construction jobs, and “A&D will keep 98% of every payment; Action Telecom will receive 2% of every payment.”
In imposing the sentences, Judge Houston emphasized that Otero’s and A&D’s scheme took contracts away from veterans who “bore the weight of war.” Defendants’ crimes harmed disabled veterans by diverting contracts that should have been awarded to legitimate SDVOSBs, and “snatched” contracts “right out of their hands.” Judge Houston also stated that the sentences would deter government contractors from similar crimes, and make clear that defrauding the programs was not “worth the gamble.”
“The United States sets aside important contract work for service-disabled veterans as one small way to recognize their patriotism and repay the enormous debt we owe them for their service,” said United States Attorney Robert S. Brewer, Jr. “Our office will continue to protect these programs and hold those who abuse them fully accountable.”
The criminal case was prosecuted by Assistant United States Attorneys Rebecca Kanter and Aaron Arnzen. The civil case was brought by Assistant United States Attorneys Joseph Price and Doug Keehn.
CORPORATE DEFENDANTS
A&D General Contracting, Inc., Santee, California
INDIVIDUAL DEFENDANTS
Andrew Otero El Cajon, CA
Criminal Case No. 17CR0879-JAH
Civil Case No. 15CV0441-JAH
SUMMARY OF CHARGES
Count 1: Conspiracy to defraud and commit offenses (18 U.S.C. § 371)
Maximum penalties: 5 years’ imprisonment; 3 years’ supervised release; a fine of $250,000 or twice the gross gain or gross loss resulting from the offense, whichever is greatest; and a mandatory special assessment of $10
Count 2-4: Major fraud against the United States (18 U.S.C. § 1031)
Maximum penalties: 10years’ imprisonment; supervised release; a fine of $1,000,000 per count ($5,000,000 total); and a mandatory special assessment of $100
Counts 5-7: Wire fraud (18 U.S.C. § 1343)
Maximum penalties: 20 years’ imprisonment; a fine of $250,000 or twice the gross gain or gross loss resulting from the offense, whichever is greatest; and a mandatory special assessment of $100
Counts: 10, 14:
False statements (18 U.S.C. § 1001)
Maximum penalties: 5 years’ imprisonment; a fine; and a mandatory special assessment of $100
AGENCIES
Department of Veterans Affairs, Office of Inspector General
Sampson County Members of Violent Drug Trafficking Organization SentencedRead the Press Release
Operation Sugar Hill Gang defendants receive more than a century of time in federal prison.
RALEIGH – The United States Attorney’s Office for the Eastern District of North Carolina announced that ANTONIO KEVIN MCKOY, 32, of Garland, NC, TONY CHEVALLIER, 40, of Clinton, NC, and JABARR RYEHEINE RUDOLPH, 39, of Clinton, NC were sentenced by United States District Judge James C. Dever, III. MCKOY was sentenced to life of imprisonment plus 5 years, followed by 6 years of supervised release. CHEVALLIER was sentenced to 360 months followed by 10 years of supervised release and RUDOLPH was sentenced to 240 months followed by 3 years of supervised release.
A federal jury found all three men guilty of Conspiracy to distribute and possess with the intent to distribute significant quantities of multiple controlled substances, including methamphetamine, heroin, crack cocaine and cocaine, and "Molly". Additional convictions were sustained for the distribution of various controlled substances and multiple firearm related charges.
The investigation giving rise to the charges faced at trial began in 2013. Multiple and extensive investigative techniques were utilized throughout this case. The evidence presented at trial detailed a significant drug trafficking organization (“DTO”) that was built and lead by ANTONIO MCKOY. The DTO maintained contacts with individuals throughout the Southeastern United States who supplied the drugs sold primarily within Eastern North Carolina. In addition to trafficking drugs, the DTO maintained a sophisticated apparatus that was used to launder the proceeds derived from drug sales. The evidence presented at trial showed a trucking company that MCKOY started in early 2016 was used to conceal the money collected in the drug business.
The following additional individuals were charged in relation to the drug conspiracy as part of Operation Sugar Hill Gang Organized Crime Drug Enforcement Task Force (OCDETF) investigation and their sentences are listed below:
- James Daniel McKoy of Garland, North Carolina – 210 months in prison
- Jafa McKoy of Clinton, North Carolina – 209 months in prison
- William Garner of Clinton, North Carolina – 144 months in prison
- Robert Parker of Clinton, North Carolina - 137 months in prison
- Donald Garner of Harrells, North Carolina - 120 months in prison
- Deames Henry of Garland, North Carolina – 120 months in prison
- Gregory Bright of Turkey, North Carolina – 115 months in prison
- Derrick Ingram of Clinton, North Carolina – 114 months in prison
- Brandon Smith of Wilmington, North Carolina – 108 months in prison
- Amanda Burch of Clinton, North Carolina – 96 months in prison
- David Williams of Harrells, North Carolina – 90 months in prison
- Earl Melvin of Clinton, North Carolina – 60 months in prison
- Darryl McKoy of Garland, North Carolina- 48 months in prison
- Derrell Wilson of Warsaw, North Carolina – 42 months in prison
- Andrekia Parker of Clinton, North Carolina – 30 months in prison
- Bryant Carr of Harrells, North Carolina – 27 months in prison
- Harry Oates of Wilmington, North Carolina – 21 months in prison
- Russell Bell of Clinton, North Carolina – 15 months in prison
- Bryan Carr – 12 months in prison
- Braylynn Spencer of Willington, North Carolina– 12 months in prison
- Craig Melvin of Raleigh, North Carolina – 12 months in prison
- Anthony Barnes of Garland, North Carolina – 11 months in prison
- Ryan Carr of Clinton, North Carolina – 36 months’ probation
The case is a federal Organized Crime Drug Enforcement Task Force (OCDETF) criminal matter that was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), the Sampson County Sheriff’s Office, Internal Revenue Service Criminal Investigation, U.S. Probation Office, the North Carolina State Bureau of Investigation, North Carolina State Highway Patrol, and the North Carolina Departments of Revenue and Emergency Management. Assistant United States Attorneys Brad Knott and Toby Lathan prosecuted the case on behalf of the United States.
Rowan County Meth Dealer Sentenced to 16 Years in PrisonRead the Press Release
GREENSBORO, N.C. - A North Carolina resident was sentenced to sixteen years in prison for on June 25, 2019, for distributing methamphetamine, conspiracy, and money laundering in Rowan County, announced United States Attorney Matthew G.T. Martin of the Middle District of North Carolina.
SALVADOR VALADEZ, JR., age 37, of Salisbury, North Carolina, was sentenced to 192 months’ imprisonment by the Honorable Thomas D. Schroeder in federal court in Winston-Salem. VALADEZ pleaded guilty to conspiracy to distribute methamphetamine and conspiracy to commit money laundering in Rowan County. In addition to the prison term he was ordered to serve a five-year term of supervised release after completing his sentence.
According to documents filed in court, a multi-agency, multi-state investigation identified VALADEZ as a large-scale supplier of methamphetamine in Salisbury, Rowan County, North Carolina. Using a cooperating witness, agents recorded a sale of approximately four ounces of methamphetamine by VALADEZ on October 10, 2017, in Salisbury. Other persons engaged in drug trafficking who were identified in this investigation also indicated that VALADEZ was a drug distributor, selling quantities ranging from four ounces to one-half kilogram of methamphetamine. VALADEZ stated to others that he received his supply of methamphetamine by air smuggling and by mail, and that he transferred money to his suppliers through wire services.
This case was investigated by the Rowan County Sheriff’s Department, Salisbury Police Department, North Carolina State Bureau of Investigation, Mocksville Police Department, and Yadkinville Police Department. The case was prosecuted by Assistant United States Attorney Terry M. Meinecke.
###
Repeat Cocaine Kingpin Robert Shepherd Sentenced to 13 Years in Federal PrisonRead the Press Release
WILMINGTON, Del. – A Philadelphia drug trafficker with ties to Wilmington was sentenced by Chief U.S. District Judge Leonard P. Stark on Wednesday, June 26, 2019, to 13 years in prison for conspiring to distribute cocaine. According to court documents and statements made in open court, defendant Robert Shepherd, III, 43, originally from Wilmington, lived an extravagant lifestyle in Philadelphia funded by trafficking cocaine. Shepherd sent kilogram quantities of that cocaine to co-defendant Brian Wilson in Wilmington, Delaware.
Shepherd’s conviction is the result of a long-term New Castle County High Intensity Drug Trafficking Area (“HIDTA”) investigation spearheaded by the FBI Delaware Violent Crime Safe Streets Taskforce. Investigators seized four firearms, over five kilograms of cocaine, and roughly 150 grams of heroin as part of the case. This was Shepherd’s second federal drug conviction. The defendant was sentenced in 2010 for his leading role in distributing over 100 kilograms of cocaine in Philadelphia and Wilmington. Shepherd was under supervision by the federal court at the time that he committed this second drug trafficking offense.
U.S. Attorney Weiss stated, “Robert Shepherd has made a career off the suffering of Delawareans addicted to illegal drugs. The Court’s sentence demonstrates that large scale traffickers will be punished significantly for their crimes. My office will continue to work with our law enforcement partners to ensure that career drug traffickers like Mr. Shepherd are brought to justice.”
Assistant U.S. Attorney Christopher L. de Barrena-Sarobe prosecuted the case. The FBI was assisted in this case by Wilmington Police Department and the Delaware Attorney General’s Office.
The FBI Delaware Violent Crime Safe Streets Taskforce is a part of the New Castle County HIDTA, comprised of the Delaware State Police, Delaware Department of Probation and Parole, New Castle County Police Department, University of Delaware Police Department, and Wilmington Police Department.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the District of Delaware. Related court documents and information is located on the website of the District of Delaware for the District of Delaware or on PACER by searching for Case No. 1:16-cr-00093.
Religion Instructor Sentenced for Illegal Sexual Conduct with Minor StudentRead the Press Release
ALEXANDRIA, Va. – An Alexandria man was sentenced today to 10 years in prison for enticing a minor to engage in sexual conduct and transferring obscene matter to a minor.
According to court documents, Seitu Sulayman Kokayi, 30, was a content developer at the University of Maryland University College campus and a Quran instructor at a mosque in Washington, D.C. from 2009 until his arrest in August 2018. The victim was 15 years of age and was a student of Kokayi until the time of his arrest. Over a three week period in August 2018, Kokayi and the victim communicated by phone on 256 occasions for over 32 hours. They also had 43 FaceTime sessions. Kokayi engaged the minor victim in sexually explicit conversations, proceeding to entice the child to disrobe and engage in sexual acts over FaceTime. Kokayi also exposed himself to the victim, masturbating on FaceTime with the victim on multiple occasions. Also according to court records, Kokayi promoted support for the Islamic State and other violent activity by sending videos and other jihadist propaganda to his students, family members and friends.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the 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.justice.gov/psc.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and John P. Selleck, Acting Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after sentencing by U.S. District Judge Leonie M. Brinkema. Assistant U.S. Attorneys Kellen S. Dwyer, Dennis M. Fitzpatrick and Department of Justice Trial Attorney Joseph Attias 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. 1:18-cr-410.
Raytheon Company Agrees to Pay $1 Million in Settlement of Claim Involving Procurement FraudRead the Press Release
LAS VEGAS, Nev. – United States Attorney Nicholas A. Trutanich announced today that Raytheon Company, a supplier of equipment to various Government agencies, has agreed to pay $1.075 million to resolve allegations that it violated the False Claims Act by inducing the County of Los Angeles, California, to enter into a contract funded by a federal grant, based on misrepresentations regarding Raytheon’s capability to provide the products involved. Raytheon was contracted to provide interoperable dispatch consoles to the County of Los Angeles for its sheriff and fire departments.
The False Claims Act is the United States’ primary civil remedy to redress false claims for government funds and property under government programs and contracts relating to such varied areas as health care, defense and national security, food safety and inspection, federally insured loans and mortgages, highway funds, small business contracts, agricultural subsidies, and disaster assistance.
The case was investigated by the Department of Homeland Security Office of Inspector General. Assistant U.S. Attorney Roger Wenthe from the District of Nevada litigated the case.
The claims resolved by this settlement are allegations only, and there has been no determination of liability.
###
Randolph County Man Gets 14 Years for Dealing MethRead the Press Release
Lewis D. Higgins, 54, of Ruma, Illinois, has been sentenced to 168 months in federal prison on a methamphetamine violation, U.S. Attorney Steven D. Weinhoeft announced today. Higgins previously pleaded guilty to a single-count indictment charging conspiracy to distribute more than 50 grams of methamphetamine. His sentence included a four-year term of supervised release and a fine of $200.
Evidence at the plea and sentencing hearings established that, between 2016 and June 2018, Higgins was involved with co-defendant David M. Bereitschaft and others in the distribution of methamphetamine in Perry and Randolph counties. The judge found that Higgins was responsible for the distribution of 7.5 kilograms of ice (methamphetamine with a purity level of at least 80 percent). Higgins also received an enhanced sentence based on his possession of firearms during the drug conspiracy.
Bereitschaft pleaded guilty to his role in the conspiracy earlier this year and is scheduled to be sentenced on August 13, 2019.
The investigation was conducted by the Randolph County Sheriff’s Office, the Jackson County Sheriff’s Office, the Sparta Police Department, the Chester Police Department, the Tilden Police Department, the Marissa Police Department, the St. Clair County Sheriff’s Office Drug Tactical Unit, the Drug Enforcement Administration, and the FBI. The Randolph County State’s Attorney’s Office also assisted in the investigation.
Owner of Engineering Firms Sentenced to Five Years in Prison for Tax SchemeRead the Press Release
Wagdy A. Guirguis, owner of several engineering businesses, was sentenced today to five years in prison in Honolulu, Hawaii, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and United States Attorney Kenji M. Price for the District of Hawaii.
On Nov. 20, 2018, a jury convicted Guirguis of conspiracy to defraud the United States along with co-conspirator Michael Higa. In addition, Guirguis was also convicted of three counts of filing false corporate income tax returns, one count of failure to file a corporate income tax return, three counts of tax evasion, one count of corruptly endeavoring to obstruct and impede the Internal Revenue Service (IRS), and one count of witness tampering. The convictions arose from a scheme to divert funds from Guirguis’ business entities for his own personal benefit and to avoid the payment of federal employment taxes, corporate and individual income taxes, and IRS penalties.
According to the evidence presented at trial, Guirguis operated numerous engineering businesses. Higa, a Certified Public Accountant (CPA), was the controller of these businesses. Higa also served as a nominee officer of another entity controlled by Guirguis. When the IRS determined Guirguis’ businesses owed over $800,000 in federal employment taxes and assessed an $812,000 penalty, Guirguis and Higa took steps to place income and assets out of the reach of the IRS. For instance, Guirguis and Higa used the nominee entity to fraudulently convey a condominium to Guirguis’ wife. After an IRS revenue officer began questioning Mrs. Guirguis’ sole ownership of this condominium, Guirguis and Higa instructed a bookkeeper to alter the books and records in an attempt to conceal this transaction from the IRS.
From 2001 through 2012, Guirguis and Higa also used the nominee entity to divert approximately $1.3 million from Guirguis’ businesses for Guirguis’ personal use. As a result of their diversion and the concealment efforts, Guirguis’ 2010 through 2012 returns omitted $553,000 in income, resulting in a tax deficiency of $165,000.
In addition, Guirguis filed corporate income tax returns that fraudulently omitted millions of dollars of gross receipts. For one of his businesses, Guirguis simply did not file a corporate tax return, thereby not reporting more than $1.7 million in gross receipts.
After the IRS levied the bank accounts of one business, Guirguis diverted incoming funds owed to that business, directing payment of the funds to a different business. Guirguis also instructed a tenant to disregard IRS collection notices and pay rent directly to him rather than to the IRS. Moreover, Guirguis made false and misleading statements to IRS revenue officers, all in an effort to obstruct the IRS’ efforts to collect on the taxes he and his companies owed.
To impede the criminal investigation into his tax violations, Guirguis falsely told an employee, who had testified before the grand jury, that he did not know about the false backdating in the books of the nominee entity, and asked the employee to sign a false statement to that effect.
In addition to the term of imprisonment, U.S. District Judge Helen Gillmor ordered Guirguis to serve 3 years of supervised release, and to pay a $925 special assessment, $6,730.24 in prosecution costs, and $3,308,868 in restitution to the IRS minus any payments already made to the IRS.
Sentencing for Michael Higa is scheduled for July 1.
Principal Deputy Assistant Attorney General Zuckerman and United States Attorney Price thanked special agents of IRS-Criminal Investigation, who investigated the case, and Tax Division Senior Litigation Counsel John Sullivan and Trial Attorney Anahi Cortada and Assistant United States Attorney Rebecca Perlmutter, who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Owner of Betty Ford Center Reaches Settlement with Justice Department to Improve Access for Individuals with DisabilitiesRead the Press Release
LOS ANGELES – The Hazelden Betty Ford Foundation has entered into a settlement agreement with the United States in which it agrees to remove architectural barriers to access at the Betty Ford Center, a well-known drug and alcohol treatment facility it owns and operates in Rancho Mirage.
The settlement agreement, which was finalized today, resolves allegations that the Betty Ford Center violated the Americans with Disabilities Act (ADA), which prohibits discrimination by places of public accommodation against individuals with disabilities. Hazelden, a Center City, Minnesota-based addiction treatment and advocacy organization, fully cooperated with the government’s investigation.
“People should never be deterred or impeded from seeking treatment for drug or alcohol addiction because of a physical disability,” said United States Attorney Nick Hanna. “Our office will enforce the rights of individuals with disabilities to access healthcare without barriers. We commend Hazelden for taking steps to comply with the ADA to ensure that the Betty Ford Center is accessible to all.”
Under the settlement agreement, Hazelden must:
- Remove existing barriers to access throughout the Betty Ford Center, including in-patient rooms, restrooms and common areas;
- Ensure that any new buildings constructed on the Betty Ford Center campus are accessible;
- Relocate equipment and furniture where necessary to provide equal access to facilities; and
- Modify practices, policies and procedures to ensure that people with disabilities have full and equal access to all of the services offered by the Betty Ford Center.
Assistant United States Attorney Matthew Nickell of the Civil Division’s Civil Rights Section handled this matter in conjunction with the Disability Rights Section of the Justice Department’s Civil Rights Division.
For more information on the ADA or this settlement agreement, please call the toll-free ADA Information Line at 800-514-0301 or 800-514-0383 (TDD), or access the ADA website at http://www.ada.gov.
Owner of Tampa-Area Medical Marketing Company Found Guilty in $2 Million Medicare Fraud SchemeRead the Press Release
Tampa, FL – A federal jury found the owner of a Tampa-area medical marketing company guilty today for his role in an over $2.2 million Medicare fraud scheme involving the payment of kickbacks and bribes to medical clinics in Miami in exchange for the referral of DNA swabs that were obtained from Medicare beneficiaries.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Maria Chapa Lopez of the Middle District of Florida, Special Agent in Charge Michael McPherson of the FBI’s Tampa Field Office and Assistant Inspector General Shimon Richmond of the U.S. Department of Health and Human Services Office of the Inspector General’s (HHS-OIG) Miami Regional Office made the announcement.
Following a four-day trial, David Brock Lovelace, 49, of Land o’ Lakes, Florida, the owner of DBL Management LLC was found guilty of one count of conspiracy to pay health care kickbacks and one count of structuring currency transactions to avoid reporting requirements. Lovelace is expected to be sentenced on Oct. 2, 2019, by U.S. District Judge Susan C. Bucklew of the Middle District of Florida, who presided over the trial.
According to the evidence presented at trial, Lovelace was paid by Clinical Laboratory Company A for each DNA swab that Lovelace arranged to be referred to the laboratory. In order to obtain DNA swabs, Lovelace paid cash kickbacks and bribes to medical clinics in Miami in exchange for the referral of DNA swabs that were obtained from Medicare beneficiaries. Lovelace directed the owners of the medical clinics to collect the DNA of all of the patients at the clinics, regardless of medical necessity.
In the first phase of the scheme, from November 2013 to May 2014, the evidence at trial showed that Lovelace paid these cash kickbacks directly. In the second phase of the scheme, from May 2014 to November 2014, after his arrest on other charges, Lovelace established shell companies, including Healthcare Marketing Florida of Melbourne, Florida, and conspired with nominee owners to facilitate the payment of kickbacks, receipt of fraud proceeds, and transfer of unlawfully obtained DNA samples for medically unnecessary testing. Over the course of the entire conspiracy, Clinical Laboratory Company A submitted over $2.2 million in genetic testing claims and paid Lovelace a percentage of the Medicare reimbursements that it received.
In order to conceal his payment of illegal cash kickbacks, the evidence at trial showed that Lovelace would travel to different ATM’s and bank branches throughout Southern Florida and make separate withdrawals of thousands of dollars in cash in order to avoid the filing of U.S. Department of Treasury “currency transaction reports” for an individual withdrawal of over $10,000.
Lovelace was previously found guilty by a jury in December 2015 of various health care fraud, money laundering and identity theft charges in a case handled by the Criminal Division’s Fraud Section. He is currently serving 14 years in prison.
The case was investigated by the FBI and HHS, and was brought as part of the Medicare Fraud Strike Force, under the supervision of the U.S. Department of Justice, Criminal Division, Fraud Section and the U.S. Attorney’s Office for the Middle District of Florida. The case is being prosecuted by Trial Attorney John Michelich and Acting Assistant Chief Jacob Foster of the Fraud Section.
The Fraud Section leads the Medicare Fraud Strike Force. Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion. In addition, the HHS Centers for Medicare & Medicaid Services, working in conjunction with the HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers.
Our Lady of Lourdes Agrees to Pay over $1.1M to Resolve Claims It Failed to Perform Background Checks, Fraudulently Billed U.S. for Community Service GrantsRead the Press Release
PHILADELPHIA and CAMDEN – United States Attorneys William M. McSwain for the Eastern District of Pennsylvania and Craig Carpenito for the District of New Jersey jointly announced that Our Lady of Lourdes Health Foundation and two related Our Lady of Lourdes companies have agreed to pay $1,143,881.19 to resolve claims arising from Lourdes’ administration of community service grants funded through the Corporation for National and Community Service (CNCS).
From 2012 until 2017, Lourdes administered multiple grants in CNCS’s Senior Corps program, including in the Foster Grandparent Program (FGP), which places seniors in school and community settings to serve alongside youth with exceptional needs, and the Senior Companion Program (SCP), which places seniors in community and residential settings to assist other seniors who have difficulty with tasks of daily living. These programs provide small hourly stipends to the volunteers performing these services, who undergo training and must clear criminal history checks to ensure their suitability for service.
From 2014 until 2017, Lourdes either failed to perform these criminal history checks or failed to keep records of doing so. As a result, 46 individuals were permitted to serve in an FGP or SCP project without any documentation that they received one or more of the required criminal history checks. When a monitoring visit was scheduled in 2017, Lourdes employees cut-and-pasted other background checks in an attempt to conceal this failure from CNCS officials.
In addition, Lourdes employees – including two program supervisors – falsely completed time sheets showing program participants serving hours that were impossible, because the locations at which they were purportedly serving were closed.
When the United States commenced its formal investigation in 2017 and brought these issues to the attention of senior Lourdes management, Lourdes voluntarily relinquished the grants immediately and terminated all of the employees who had participated in the grant administration. Lourdes has actively cooperated with the United States since its senior management was advised of the issues in the grant programs. As part of this cooperation, it performed appropriate criminal history checks on all program participants and determined that all 46 individuals would have been permitted to participate in the programs had those checks been performed in a timely manner originally.
“Criminal history checks are a critical protection for the vulnerable populations with whom Senior Companions and Foster Grandparents work,” said U.S. Attorney McSwain. “Strict compliance with the requirements for these essential safeguards is necessary to ensure that predators do not gain access to potential victims. And every federal grantee, including community service organizations, is required to honestly and openly report the service that its volunteers perform. Every dollar spent on an hour that was not actually served is one that is not available to support other community service efforts.”
“Just as important as the work these volunteers do is the system that has been set up to ensure that they have been thoroughly vetted,” U.S. Attorney Carpenito said. “Whether they failed to keep accurate records of the results of these criminal background checks – or just failed to do them – the results were the same. Our Lady of Lourdes potentially put their clients’ safety at risk. And billing for no-show employees cannot be tolerated, especially when taxpayer dollars are being spent.”
“This fraud deprived school children and senior citizens of promised services and jeopardized their safety with bogus criminal history checks for the volunteers who served them,” said CNCS’s Inspector General Deborah J. Jeffrey. “We hope that the substantial penalties included in this settlement will deter other grantees from similar misconduct. We commend our partners at the Department of Justice for their outstanding efforts in pursuing fraud against national service programs.”
United States Attorneys McSwain and Carpenito praised Lourdes’ work in addressing the issues in these programs: “We appreciate the seriousness with which Lourdes senior management has taken this issue and the prompt, aggressive remedial actions that they took to prevent further harm to CNCS programs and potential harm to vulnerable communities. We hope this settlement will serve as a message to other managers to be vigilant in overseeing government-funded programs and to ensure that employees do not attempt to conceal any non-compliance.”
This investigation was conducted jointly by the United States Attorney’s Offices for the Eastern District of Pennsylvania and District of New Jersey with the Corporation for National and Community Service Office of Inspector General. Assistant United States Attorneys Paul W. Kaufman and Veronica Finkelstein of the Eastern District of Pennsylvania and Jessica O’Neill of the District of New Jersey handled the investigation and settlement. This case was initiated as part of the U.S. Attorney’s Office for the Eastern District of Pennsylvania’s Affirmative Civil Enforcement (ACE) Strike Force focus on grant fraud.
The claims resolved by the settlement are allegations only; there has been no determination of liability.
Orlando Man Sentenced to 15 Years in Federal Prison for RobberiesRead the Press Release
Orlando, Florida – U.S. District Judge Paul G. Byron has sentenced Adrian Gomez (20, Orlando) to 15 years in federal prison for committing armed robberies of a pizza delivery driver, a taxi cab driver, and a shoe salesman, and for brandishing and possessing firearms during crimes of violence. Gomez had pleaded guilty on March 27, 2019.
According to court documents, on September 11, 2018, Gomez robbed a Pizza Hut delivery driver at gunpoint, taking approximately $190 in cash, as well as a number of Pizza Hut products. On September 16, 2018, Gomez robbed a shoe salesman at gunpoint, taking from him several pair of shoes worth approximately $800. The following day, Gomez robbed a taxicab driver at gunpoint, taking the driver’s watch, wallet, iPhone X, and approximately $100 in cash.
This case was investigated by the Federal Bureau of Investigation and the Orange County Sheriff’s Office. It was prosecuted by Assistant United States Attorney Chauncey A. Bratt.
This case was brought as part of Project Safe Neighborhoods (“PSN”). PSN is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime. In the Middle District of Florida, U.S. Attorney Maria Chapa Lopez coordinates PSN efforts in cooperation with various federal, state, and local law enforcement officials.
Orange County Man Convicted of Bankruptcy FraudRead the Press Release
Orlando, Florida – United States Attorney Maria Chapa Lopez announces that a federal jury has found Christopher Coburn (34, Winter Garden) guilty of five counts of bankruptcy fraud and two counts of falsification of records in a bankruptcy proceeding. He faces a maximum penalty of 5 years’ imprisonment for each bankruptcy fraud count and up to 20 years in prison for each falsification of records count. His sentencing hearing has been scheduled for September 9, 2019.
According to testimony and evidence presented at trial, Coburn solicited homeowners whose mortgages were in default and offered to rescue their homes from foreclosure. In order to prevent the Federal National Mortgage Association (“Fannie Mae”) and multiple financial institutions holding mortgages from lawfully foreclosing on homeowners’ properties, Coburn engaged a bankruptcy fraud scheme in which he filed or caused to be filed fraudulent bankruptcy petitions in the name of the homeowner, without homeowner’s knowledge or consent, just prior to the scheduled foreclosure sale dates. These fraudulent bankruptcies invoked the automatic stay provision of the bankruptcy code, preventing Fannie Mae and the financial institutions from conducting lawful foreclosure sales and obtaining title to the property. The fraudulent bankruptcy petitions filed by Coburn enabled him to collect fees and allowed him to refer the properties to real estate agents in order to obtain ill-gotten commissions for short-sales. Coburn also filed other false and fraudulent bankruptcy forms in the names of some homeowners relied on by the Office of the United States Trustee and the United States Bankruptcy Court for the Middle District of Florida.
This case was investigated by the Federal Housing Finance Agency—Office of Inspector General, with substantial assistance from the Office of the United States Trustee for the Middle District of Florida. It is being prosecuted by Special Assistant United States Attorney Chris Poor.
Ohio Man Sentenced to Life in Prison for Federal Hate Crimes Related to August 2017 Car Attack at Rally in Charlottesville, VirginiaRead the Press Release
WASHINGTON – James Alex Fields Jr., 22, the Ohio man who drove his car into a crowd of counter-protestors at the “Unite the Right Rally” on Aug. 12, 2017, killing one woman and injuring dozens, was sentenced today in the Western District of Virginia to life in prison for his crimes. Fields previously pleaded guilty to 29 violations of the Matthew Shepard and James Byrd Jr. Hate Crimes Prevention Act, 18 U.S.C. § 249, for the attack.
“Hatred and bigotry have no place in our nation. Violent actions inspired by such warped thinking are a disgrace to our people and our values, and the Department of Justice will not tolerate such depraved acts,” said Assistant Attorney General Eric Dreiband. “Prosecuting hate crimes and acts of domestic terrorism continues to be a top priority for the Department of Justice. Anyone who commits a crime motivated by hatred for the race, color, religion, national origin or other protected trait of any person should be on notice: the United States government will use its enormous power to bring perpetrators to justice, and we will continue to do so for as long as it takes to rid our nation of these vile and monstrous crimes.”
“On August 12, 2017, this defendant committed a hate-inspired act of domestic terrorism that killed 32-year-old Heather Heyer and injured over 30 peaceful protesters,” U.S. Attorney Thomas T. Cullen stated. “We believe that his life sentence furthers the Department of Justice’s substantial interest in prosecuting hate crimes and protecting the civil rights of all Americans. We are grateful for the dedication and hard work of the FBI and the Virginia State Police in investigating this matter and bringing the defendant to justice.”
“Hate crimes are not just an attack on the victim: they are also meant to threaten and intimidate an entire community,” said Special Agent in Charge David Archey of the FBI’s Richmond Division. “This is also a case of domestic terrorism, and we must send a message that terrorism and hatred-inspired violence have no place in our communities. The FBI will continue to work with our law enforcement partners to ensure Virginia’s citizens do not fall victim to violence because of hateful ideologies or intolerance of others. The FBI is grateful to the Office of the United States Attorney, the Virginia State Police, the Charlottesville Police Department, and to all the members of the public who assisted in this investigation.”
At his plea hearing on March 27, Fields admitted under oath that he drove into the crowd of counter-protestors because of the actual and perceived race, color, national origin, and religion of its members. He further admitted that his actions killed Heather Heyer, and that he intended to kill the other victims he struck and injured with his car in the crowd.
Fields also admitted that, prior to Aug. 12, 2017, he used social media accounts to express and promote white supremacist views; to express support for the social and racial policies of Adolf Hitler and Nazi-era Germany, including the Holocaust; and to espouse violence against African Americans, Jewish people, and members of other racial, ethnic, and religious groups he perceived to be non-white.
Fields further admitted that, on Aug. 12, 2017, he attended the “Unite the Right” rally in Emancipation Park in Charlottesville, Virginia. That morning, multiple groups and individuals espousing white-supremacist ideology also attended the rally. These rally participants, including Fields, engaged in chants promoting or expressing white supremacist and other racist and anti-Semitic views.
Shortly before the scheduled start of the Unite the Right rally, law enforcement declared an “unlawful assembly” and required rally participants, including Fields, to disperse. Fields later returned to his vehicle and began to drive on the streets of Charlottesville, Virginia.
Fields drove his car onto Fourth Street, a narrow, downhill, one-way street in downtown Charlottesville. At or around that same time, a racially and ethnically diverse crowd had gathered at the bottom of the hill, at the intersection of Fourth and Water Streets. Many of the individuals in the crowd were celebrating as they were chanting and carrying signs promoting equality and protesting against racial and other forms of discrimination. Fields slowly proceeded in his vehicle down Fourth Street toward the crowd. He then stopped and observed the crowd while idling in his vehicle. With no vehicle behind him, Fields then slowly reversed his vehicle toward the top of the hill and away from the crowd of counter-protestors.
At or around that same time, the members of the crowd began to walk up the hill, populating the streets and sidewalks between the buildings on Fourth Street. Having reversed his car to a point at or near the top of the hill and the intersection of Fourth and Market Streets, Fields stopped again. Fields admitted that he then rapidly accelerated forward down Fourth Street in his vehicle, running through a stop sign and across a raised pedestrian mall, and drove directly into the crowd. Fields’s vehicle stopped only when it struck another stopped vehicle near the intersection of Fourth and Water Streets. Fields then rapidly reversed his car and fled the scene. As Fields drove into and through the crowd, Fields struck numerous individuals, killing Heather Heyer and injuring dozens of people nearby.
The investigation of the case was led by the FBI and was supported by the Charlottesville Police Department and the Virginia State Police. The case is being prosecuted by United States Attorney Thomas T. Cullen, Assistant United States Attorney Christopher Kavanaugh, and Trial Attorney Risa Berkower of the Justice Department’s Civil Rights Division.
Ohio Man Sentenced to Life in Prison for Federal Hate Crimes Related to August 2017 Car Attack at Rally in Charlottesville, VirginiaRead the Press Release
James Alex Fields Jr., 22, the Ohio man who drove his car into a crowd of counter-protestors at the “Unite the Right Rally” on Aug. 12, 2017, killing one woman and injuring dozens, was sentenced today in the Western District of Virginia to life in prison for his crimes. Fields previously pleaded guilty to 29 violations of the Matthew Shepard and James Byrd Jr. Hate Crimes Prevention Act, 18 U.S.C. § 249, for the attack.
“Hatred and bigotry have no place in our nation. Violent actions inspired by such warped thinking are a disgrace to our people and our values, and the Department of Justice will not tolerate such depraved acts,” said Assistant Attorney General Eric Dreiband. “Prosecuting hate crimes and acts of domestic terrorism continues to be a top priority for the Department of Justice. Anyone who commits a crime motivated by hatred for the race, color, religion, national origin or other protected trait of any person should be on notice: the United States government will use its enormous power to bring perpetrators to justice, and we will continue to do so for as long as it takes to rid our nation of these vile and monstrous crimes.”
“On August 12, 2017, this defendant committed a hate-inspired act of domestic terrorism that killed 32-year-old Heather Heyer and injured over 30 peaceful protesters,” U.S. Attorney Thomas T. Cullen stated. “We believe that his life sentence furthers the Department of Justice’s substantial interest in prosecuting hate crimes and protecting the civil rights of all Americans. We are grateful for the dedication and hard work of the FBI and the Virginia State Police in investigating this matter and bringing the defendant to justice.”
“Hate crimes are not just an attack on the victim: they are also meant to threaten and intimidate an entire community,” said Special Agent in Charge David Archey of the FBI’s Richmond Division. “This is also a case of domestic terrorism, and we must send a message that terrorism and hatred-inspired violence have no place in our communities. The FBI will continue to work with our law enforcement partners to ensure Virginia’s citizens do not fall victim to violence because of hateful ideologies or intolerance of others. The FBI is grateful to the Office of the United States Attorney, the Virginia State Police, the Charlottesville Police Department, and to all the members of the public who assisted in this investigation.”
At his plea hearing on March 27, Fields admitted under oath that he drove into the crowd of counter-protestors because of the actual and perceived race, color, national origin, and religion of its members. He further admitted that his actions killed Heather Heyer, and that he intended to kill the other victims he struck and injured with his car in the crowd.
Fields also admitted that, prior to Aug. 12, 2017, he used social media accounts to express and promote white supremacist views; to express support for the social and racial policies of Adolf Hitler and Nazi-era Germany, including the Holocaust; and to espouse violence against African Americans, Jewish people, and members of other racial, ethnic, and religious groups he perceived to be non-white.
Fields further admitted that, on Aug. 12, 2017, he attended the “Unite the Right” rally in Emancipation Park in Charlottesville, Virginia. That morning, multiple groups and individuals espousing white-supremacist ideology also attended the rally. These rally participants, including Fields, engaged in chants promoting or expressing white supremacist and other racist and anti-Semitic views.
Shortly before the scheduled start of the Unite the Right rally, law enforcement declared an “unlawful assembly” and required rally participants, including Fields, to disperse. Fields later returned to his vehicle and began to drive on the streets of Charlottesville, Virginia.
Fields drove his car onto Fourth Street, a narrow, downhill, one-way street in downtown Charlottesville. At or around that same time, a racially and ethnically diverse crowd had gathered at the bottom of the hill, at the intersection of Fourth and Water Streets. Many of the individuals in the crowd were celebrating as they were chanting and carrying signs promoting equality and protesting against racial and other forms of discrimination. Fields slowly proceeded in his vehicle down Fourth Street toward the crowd. He then stopped and observed the crowd while idling in his vehicle. With no vehicle behind him, Fields then slowly reversed his vehicle toward the top of the hill and away from the crowd of counter-protestors.
At or around that same time, the members of the crowd began to walk up the hill, populating the streets and sidewalks between the buildings on Fourth Street. Having reversed his car to a point at or near the top of the hill and the intersection of Fourth and Market Streets, Fields stopped again. Fields admitted that he then rapidly accelerated forward down Fourth Street in his vehicle, running through a stop sign and across a raised pedestrian mall, and drove directly into the crowd. Fields’s vehicle stopped only when it struck another stopped vehicle near the intersection of Fourth and Water Streets. Fields then rapidly reversed his car and fled the scene. As Fields drove into and through the crowd, Fields struck numerous individuals, killing Heather Heyer and injuring dozens of people nearby.
The investigation of the case was led by the FBI and was supported by the Charlottesville Police Department and the Virginia State Police. The case is being prosecuted by United States Attorney Thomas T. Cullen, Assistant United States Attorney Christopher Kavanaugh, and Trial Attorney Risa Berkower of the Justice Department’s Civil Rights Division.
For more information about Department of Justice’s work to combat and prevent hate crimes, visit www.justice.gov/hatecrimes: a one-stop portal with links to Department of Justice hate crimes resources for law enforcement, media, researchers, victims, advocacy groups, and other organizations and individuals.
Nigerian Man Sentenced to Prison for Defrauding the IRSRead the Press Release
ALEXANDRIA, Va. – A Nigerian man who formerly resided in Herndon was sentenced today to one year in prison for his involvement in stealing income tax refunds in 2015 and laundering the proceeds of his crimes.
According to court documents, Odewale Abraham, 50, pleaded guilty to two counts of theft of government money and to two counts of money laundering. Abraham controlled three bank accounts into which income tax refunds were wired. The tax returns were filed electronically in the names of actual taxpayers, but their refunds were fraudulently directed to bank accounts controlled by Abraham.
Abraham would then make cash withdrawals or use debit cards to purchase multiple Money Gram money orders in denominations of $990 or $995 at a Walmart in Vienna. Most of the Money Gram orders were made payable to Odewale Abraham, but were purchased with a debit card from an account that had been fraudulently opened in another person’s name. The purchase of the money orders was designed in whole or in part to conceal the nature and source of the proceeds of the specified unlawful activity.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Raymond Villanueva, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Washington, D.C., and Kelly R. Jackson, Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation (IRS-CI), made the announcement after sentencing by Senior U.S. District Judge Claude M. Hilton. Special Assistant U.S. Attorney Russell L. Carlberg 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. 1:18-cr-167.
New Haven Man Charged with Illegally Possessing HandgunRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, today announced that a federal grand jury in New Haven has returned an indictment charging ERRIE McCLENDON, also known as “Buck,” 28, of New Haven, with one count of possession of a firearm by a convicted felon.
The indictment was returned on June 11, 2019. McClendon appeared today before U.S. Magistrate Judge Sarah A. L. Merriam in New Haven and entered a plea of not guilty to the charge. McClendon was ordered detained pending trial.
As alleged in the indictment, on May 11, 2019, McClendon possessed a Ruger, model P85, 9mm pistol with an obliterated serial number. Prior to that date, McClendon had been convicted in state court of felony narcotics and larceny offenses.
It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
If convicted of the offense, McClendon faces a maximum term of imprisonment of 10 years.
McClendon has been detained since June 19, 2019, when he was arrested on a state probation violation charge.
U.S. Attorney Durham stressed that charges are only allegations, and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the New Haven Police Department. This case is being prosecuted by Assistant U.S. Attorneys Peter D. Markle and Jocelyn Courtney Kaoutzanis.
This prosecution has been brought through Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make neighborhoods safer for everyone.
Myrtle Beach Man Sentenced to Nearly 4 Years in Federal Prison on Federal Gun ChargeRead the Press Release
Florence, South Carolina --- United States Attorney Sherri A. Lydon announced today that Sedrick Lemont Jenkins, 42, of Myrtle Beach, was sentenced to nearly four years in federal prison after pleading guilty to being a felon in possession of a firearm and ammunition.
Evidence presented to the court showed that on July 30, 2018, Horry County Police Department officers received a call for service in reference to a suspicious car blocking the roadway on a street in Aynor, South Carolina. Upon arrival, officers located the car in question and conducted a traffic stop. Upon approaching the driver, Sedrick Jenkins, officers noted an odor of marijuana coming from the car. Officers deployed a K9 unit, which gave a positive alert to the odor of narcotics, and officers searched the car. During the search, officers found a loaded Smith and Wesson 9mm handgun behind a panel in the passenger side floor compartment. Jenkins is prohibited from possessing a firearm based on his prior federal drug convictions and his prior federal conviction for felon in possession of ammunition.
Chief United States District Judge R. Bryan Harwell of Florence sentenced Jenkins to 46 months in federal prison, to be followed by a three-year term of court-ordered supervision. There is no parole in the federal system.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the Horry County Police Department. It was prosecuted as part of the joint federal, state, and local Project Safe Neighborhoods (PSN), the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime. Assistant United States Attorney Lauren L. Hummel of the Florence office prosecuted the case.
#####
Muskego Small Business Owner Sentenced for Tax EvasionRead the Press Release
Matthew D. Krueger, the United States Attorney for the Eastern District of Wisconsin, announced on June 27, 2019 that Steven M. Rader (age 37) of Muskego, Wisconsin, was sentenced to five months in federal prison for stealing more than $89,000 from the federal government via a tax evasion scheme that began in 2012. Rader was also ordered to pay more than $195,000 in restitution.
Rader’s tax evasion scheme related to an entertainment business he owned and operated starting in 2012. Despite the fact that the business generated significant income, Rader failed to report any of that income on his federal tax returns for the years 2012 to 2014. In total, Rader understated his income by over $500,000 and underpaid his taxes by over $89,000.
Rader also made significant efforts to conceal his tax evasion by filing false amended tax returns and lying to federal investigators about his sources of income.
While sentencing Rader, U.S. District Judge Joseph P. Stadtmueller discussed the vital importance of adequately and appropriately filing tax returns and stated that the sentence imposed was necessary to promote respect for the law as an institution.
“The honest women and men who pay their taxes dutifully deserve to know that tax cheats face time in federal prison. We are committed to defending the integrity of our government by prosecuting tax crimes aggressively.” said U.S. Attorney Krueger.
“Tax violations have incorrectly been referred to as victimless crimes, but it's the honest law-abiding citizen who is harmed when someone such as Steven Rader tries to manipulate our nation's tax system," said Tara Sullivan, IRS Criminal Investigation Special Agent in Charge, Chicago Field Office. "The courts have overwhelmingly and continuously shown that you will be held accountable for such actions, and today's sentencing is a costly reminder."
This matter was investigated by the Criminal Investigation Division of the Internal Revenue Service and was prosecuted by Assistant United States Attorneys Julie F. Stewart and Matthew Jacobs.
# # # #
Meth Distribution in Southern Illinois Lands Missouri Man Behind Bars for 16 YearsRead the Press Release
Scott A. Carnell, 36, of Pacific, Missouri, has been sentenced to 192 months in federal prison on a methamphetamine violation, U.S. Attorney Steven D. Weinhoeft announced today. Carnell previously pleaded guilty to a single-count indictment charging conspiracy to distribute more than 50 grams of methamphetamine. Carnell’s 16-year federal sentence was ordered to run consecutively to a five-year sentence he is currently serving in the Illinois Department of Corrections on an unrelated conviction in Randolph County.
Evidence at the plea and sentencing hearings established that Carnell was involved with numerous others in the distribution of methamphetamine in Southern Illinois. The judge found that Carnell was responsible for the distribution of 2.37 kilograms of ice (methamphetamine with a purity level of at least 80 percent). The offense occurred between 2017 and August 2018, in Jackson, Randolph, and St. Clair Counties.
As part of his sentence, Carnell was also ordered to serve four years on supervised release and pay $300 in fines.
The investigation was conducted by the Randolph County Sheriff’s Office, the Jackson County Sheriff’s Office, the Sparta Police Department, the New Athens Police Department, the Marissa Police Department, the St. Louis County Police Department, the Brentwood (Missouri) Police Department, the Drug Enforcement Administration, and the FBI. The Randolph County State’s Attorney’s Office also assisted in the investigation.
Meridian Man Sentenced to Almost 8 Years in Prison for Cocaine TraffickingRead the Press Release
Jackson, Miss. – Kenneth Dewayne Williams, 45, of Meridian, was sentenced today by Chief U.S. District Judge Daniel P. Jordan III to 95 months in federal prison, followed by 5 years of supervised release, for possession with the intent to distribute 500 grams or more of cocaine, announced U.S. Attorney Mike Hurst and Brad L. Byerley, Special Agent in Charge of the Drug Enforcement Administration (DEA). Williams was also ordered to pay a $1,500.00 fine.
Williams was indicted as the result of an extensive investigation, dubbed "Deadly Dose" which began as an operation targeting illegal narcotics distribution in central Mississippi that involved the distribution of heroin and cocaine. During the investigation, agents intercepted telephone calls between Williams and a coconspirator regarding a cocaine transaction. On December 4, 2017, agents conducted a traffic stop of Williams on Interstate 20, east of Jackson. Agents seized approximately 2 kilograms of cocaine and $17,000.00. Williams pled guilty before Judge Jordan on March 26, 2019.
The case was investigated by the Drug Enforcement Administration, the Mississippi Bureau of Narcotics, the Bureau of Alcohol Tobacco Firearms and Explosives, the U.S. Marshals Service, the Hinds County Sheriff’s Office, the Jackson Police Department, and the Internal Revenue Service. It was prosecuted by Assistant United States Attorney Chris Wansley.
Men Sentenced for Methamphetamine Drug ConspiracyRead the Press Release
NEW BERN – United States Attorney Robert J. Higdon, Jr. announced that today in federal court, United States District Judge Louise W. Flanagan sentenced robert manley narron, 30, of Kenly, North Carolina to 91 months imprisonment, followed by 5 years of supervised release. On May 23, 2019, United States District Judge Louise W. Flanagan sentenced REYES JUAREZ PEREZ, 34, of Selma, North Carolina to 228 months imprisonment, followed by 5 years of supervised release.
The prosecution of NARRON and PEREZ was a part of an Organized Crime and Drug Enforcement Task Force Operation (OCDETF), which has focused on methamphetamine manufacturers and distributors in Johnston county.
NARRON and PEREZ were named in a nine-count Indictment filed on January 19, 2018 charging them with conspiracy to distribute and possess with the intent to distribute five hundred (500) grams or more of a mixture and substance containing a detectable amount of methamphetamine from February 7, 2017 until September 9, 2017; distribution of fifty (50) grams or more of a mixture and substance containing a detectable amount of methamphetamine, aiding and abetting. NARRON was also charged with possession with the intent to distribute five hundred (500) grams or more of a mixture and substance containing a detectable amount of methamphetamine and a quantity of cocaine; and possession of firearms in furtherance of a drug trafficking crime. On April 12, 2018, NARRON pled guilty to the conspiracy charge. On January 15, 2019, PEREZ pled guilty to all charges.
According to the investigation, PEREZ served as a supplier of crystal methamphetamine and supplied NARRON with such drugs, which were further distributed in Johnston County, North Carolina. NARRON and PEREZ sold over 200 grams of crystal methamphetamine to a confidential source working with law enforcement. Law enforcement arrested NARRON and searched his home where they located crystal methamphetamine, ammunition and burnt aluminum strips. Law enforcement arrested PEREZ and searched his home where they located three handguns, one of which was stolen, two rifles, ammunition and seven cell phones in PEREZ’s bedroom. Officers located over $34,000 in another room, over 1 kilogram of crystal methamphetamine, and 493 grams of cocaine. A small child also notified officers of a plastic bag in the kitchen containing 12.48 grams of cocaine.
PEREZ received a sentencing enhancement for maintaining a premises for the purpose of storing and/or distributing a controlled substance during the time of the drug conspiracy.
This case is part of the United States Attorney’s Office’s Take Back North Carolina Initiative. This initiative emphasizes the regional assignment of federal prosecutors to work with law enforcement and District Attorney’s Offices on a sustained basis in those communities to reduce the violent crime rate, drug trafficking, and crimes against law enforcement.
Investigation of this case was conducted by the Drug Enforcement Administration and Johnston County Sheriff’s Office. Assistant United States Attorney Dena King represented the government.
Man Sentenced for Fraud Conspiracy and Identity TheftRead the Press Release
ALEXANDRIA, Va. – A New York man was sentenced today to four and a half years in prison for acquiring and using stolen personal information, including thousands of payment card numbers.
According to court documents, from October 2016 through September 2018, Merlin Laguerre, 31, and his co-conspirators, committed various acts of fraud that resulted in at least $1.3 million in real or intended loss. Members of the conspiracy acquired thousands of stolen payment card numbers, primarily transmitting this account information via email and text messages. Laguerre and members of the conspiracy enriched themselves by using the stolen payment card numbers to make fraudulent purchases, and, at times, did so via the contactless payment features of smartphones. Some of the items fraudulently purchased during the conspiracy included merchandise at retail stores located within the Eastern District of Virginia.
Court documents also indicate that Laguerre tried to aid further acts of fraud even after he was taken into federal custody. In particular, Laguerre used a telephone while detained to provide another person with assistance in navigating websites dedicated to trafficking stolen payment card information.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Charles Dayoub, Acting Special Agent in Charge, Criminal Division, FBI Washington Field Office, and M. Jay Farr, Chief of Police, Arlington County Police Department, made the announcement after sentencing by U.S. District Judge Liam O’Grady. Assistant U.S. Attorneys Alexander P. Berrang and Laura Fong prosecuted the case.
The Henrico County Police Department provided significant assistance during this investigation.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:19-cr-15.
Man Pleads Guilty to Transporting A Minor Across State Lines to Prostitute in Oakland, CaliforniaRead the Press Release
OAKLAND– Eugene Latrell McNeely, aka Sleepy, aka Slim Sleep da Mac, pleaded guilty in federal court to transportation of a minor with intent to prostitute, announced United States Attorney David L. Anderson and Federal Bureau of Investigation Special Agent in Charge John F. Bennett. The Honorable James Donato, U.S. District Judge, accepted the plea.
In pleading guilty, McNeely, 36, of Oakland, admitted that on October 3, 2015, he drove from Oakland to Salem, Oregon, picked up a fourteen-year-old minor female that he had been communicating with by text message and through Facebook messenger, and drove her across state lines back to Oakland, California to work as one of his prostitutes. For approximately three months thereafter, the minor female worked as a prostitute and McNeely was her pimp.
On November 1, 2018, a federal grand jury issued a superseding indictment charging McNeely with one count of transportation of a minor for prostitution, in violation of 18 U.S.C. § 2423(a); one count of sex trafficking of children, in violation of 18 U.S.C. §§ 1591(a)(1), (b)(2), and (c); and two counts of sex trafficking by force, fraud, or coercion, in violation of 18 U.S.C. §§ 1591(a)(1) and (b)(1). McNeely pleaded guilty to the first count. The remaining counts are pending.
McNeely is currently in federal custody awaiting sentencing. Judge Donato scheduled his sentencing hearing for October 16, 2019. The maximum statutory penalty for a violation of 18 U.S.C. § 2423(a) is life in prison, with a mandatory minimum term of ten years’ imprisonment, and a $250,000 fine. Any sentence imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant U.S. Attorneys Ross Weingarten and Shailika Kotiya are prosecuting the case with the assistance of Madeline Wachs. The prosecution is the result of an investigation by the FBI and the Oakland Police Department.
Man from Deming Faces Federal Charges of Possessing Firearm and Immunition as Convicted FelonRead the Press Release
ALBUQUERQUE – Patricio Saborio Fierro, 29, of Deming, N.M., appeared in federal court in Las Cruces, N.M., on Wednesday on a charge of possessing a firearm and ammunition as a convicted felon.
A grand jury returned an indictment on June 19, 2019, charging Fierro with one count of being a felon in possession of a firearm and ammunition. According to the indictment, Fierro knowingly possessed the firearm and ammunition after he was previously convicted of the felony offense of possession with intent to distribute marijuana.
The FBI arrested Fierro in Las Cruces on Tuesday. Fierro is currently in custody awaiting a detention hearing next Tuesday, July 2. He faces up to 10 years in prison if convicted of this offense. An indictment is only an accusation. A defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
The Las Cruces office of the FBI investigated this case with assistance from the Deming Police Department. Assistant U.S. Attorney Maria Y. Armijo of the Las Cruces Branch Office
Man from Casamero Lake, N.m., Charged with Assault Causing Serious Bodily Injury to Child in Indian Country Serious Bodily Injury to Child in Indian CountryRead the Press Release
ALBUQUERQUE – Kevin Ernest Lewis, 31, of Casamero Lake, N.M., appeared in federal court in Albuquerque today on charges of assault and child abuse resulting serious bodily injury to his daughter in Indian Country.
According to a criminal complaint, Lewis committed the offenses on May 28, 2019. He allegedly got into a fight with his girlfriend while driving back from a casino. Lewis beat his girlfriend with his fists and choked her. When he later got out of the car, she moved into the driver’s seat and drove home without him.
Lewis went to his girlfriend’s house where her mother tried to stop him from coming inside. Lewis responded by punching her mother and knocking her to the ground. Lewis then attacked his girlfriend again while she was holding their 4-month-old daughter in her arms. Lewis pulled his girlfriend outside of the house and knocked her to the ground causing their daughter to hit her head on concrete. Lewis kicked the child repeatedly as his girlfriend tried to shield her with his body. The child suffered a fractured skull and cerebral hemorrhage.
Lewis is currently in custody. He faces up to 10 years in prison if convicted of assault resulting in serious bodily injury and 18 years in prison if convicted of child abuse. A criminal complaint is only an accusation. A defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt at trial.
The Navajo Nation Department of Criminal Investigations investigated this case. Assistant U.S. Attorney Michael D. Murphy is prosecuting the case.
Long-Time Redmond, Washington Investment Advisor Sentenced to Prison for Defrauding Investors of more than $3 MillionRead the Press Release
A long-time investment advisor in Redmond, Washington was sentenced today in U.S. District Court in Seattle to five years in prison for defrauding more than 15 investors of more than $3 million, announced U.S. Attorney Brian T. Moran. DENNIS GIBB, 72, the President and owner of Sweetwater Investments Inc., pleaded guilty in March 2019, to wire fraud and falsification of records with the intent to obstruct a matter within the jurisdiction of the Securities and Exchange Commission (SEC). Simultaneously, GIBB and Sweetwater investment entered into a consent decree with the SEC liquidating the Sweetwater Income Flood LP Fund and barring GIBB from further investment activity. At the sentencing hearing, Chief U.S. District Judge Ricardo S. Martinez said GIBB “entered into a scheme and deliberately, intentionally and knowingly stole money from people who came to him…. Many victims, late in their lives, entrusting him with money they intended to get them through the last years of their lives.”
“Those who invested with this defendant were not looking for the ridiculously large profits promised by some Ponzi schemers – they invested with the defendant because he promised them a secure, if modest, payout,” said U.S. Attorney Brian T. Moran. “Instead, over more than a decade this defendant stole their savings, retirement funds, future home down payments, and children’s education funds. To make matters worse, he provided victims with false tax documents, causing some to pay additional taxes on non-existent gains. This defendant not only robbed the victims financially, he stole their peace of mind and their trust.”
According to the criminal case filings and the SEC consent decree, GIBB created Sweetwater Income Flood Limited Partnership, a private fund Gibb managed, in 2008. As early as 2007, he began soliciting investors for the fund targeting those who wanted steady retirement income in the near future. Between 2007 and 2018, about 25 investors put about $7.3 million into the fund. GIBB secretly transferred more than $3.1 million from the fund for his own expenses. To hide his theft, GIBB sent investors falsified quarterly account statements. When the SEC began an examination of the Sweetwater Investments in May 2018, GIBB provided false records to examiners indicating the fund had been liquidated.
GIBB agreed to forfeit a money judgment of $3,197,401. The Court also ordered restitution of $4,233,616. This amount includes approximately $1.77 million that remained in the Income Flood fund at the time of Gibb’s consent decree and guilty plea. Gibb agreed to turn these funds over to the SEC for disbursement to victims, and the funds will be disbursed as part of the restitution order.
The case was investigated by the SEC and the FBI. The case is being prosecuted by Assistant United States Attorney Matthew Diggs.
Kenneth Francis Lee Sentenced to 30 Months in Federal Prison for Tax EvasionRead the Press Release
KNOXVILLE, Tenn. - On June 27, 2019, Kenneth Francis Lee, 48, of Sevierville, Tennessee, was sentenced by the Honorable Thomas A. Varlan, U.S. District Judge, to serve 36 months in federal prison for tax evasion and willful failure to file tax returns. Upon his release from prison, Lee will be supervised by the U.S. Probation Office for 3 years. Lee was also ordered to pay $372,531 to the Internal Revenue Service (IRS) in restitution.
Lee waived indictment by a federal grand jury and pled guilty to a bill of information on January 31, 2019. Lee admitted that he disguised income from his businesses, TNDSYS, LLC and Tennessee Data Systems, in order to evade the payment of tax debts that he owed to the IRS. Lee further admitted that he willfully failed to file personal income tax returns in 2014, 2015, and 2016.
This investigation was conducted by the Federal Bureau of Investigation (FBI) and the Criminal Investigation Division of the IRS. Assistant U.S. Attorney Bart Slabbekorn represented the United States in court proceedings.
Kanawha County Man Sentenced for Mail FraudRead the Press Release
Sentenced to eighteen months in federal prison for stealing from law firm and real estate company
CHARLESTON, W.Va. – Robert Casdorph was sentenced to eighteen months of incarceration, announced United States Attorney Mike Stuart. Casdorph, 58, of Charleston, West Virginia previously entered a guilty plea to the federal felony offense of Mail Fraud on February 6, 2019. He was also ordered to pay restitution in the amount of $134,755.44, to the law firm and real estate company where he was previously employed, as well as an insurance company that paid back a portion of defendant’s theft. United States Attorney Mike Stuart praised the work of the United States Postal Inspection Service.
“Cases like these literally defy explanation. Casdorph was trusted by his employer to the level that he was even promoted to help manage the company’s money. Instead of returning that trust with honest, hard work, Casdorph devised a terrible scheme to steal for one reason – personal greed,” said United States Attorney Mike Stuart. “Returning trust by biting the hand that feeds you. Makes no sense. We prosecute cases like these to the fullest extent of the law.”
Casdorph previously worked at a Charleston, West Virginia law firm and land company as a runner. In 2011, he was internally promoted to receive accounts and help manage money. Casdorph devised a scheme to defraud the law firm by including personal bills within the bills that the law firm was required to pay. He would present a check for signature that included both the law firm/land company bill and his personal bills totaled together. These included power, water, cell phone, state and local taxes and credit card bills. Casdorph would then place the check in the mail. This scheme went on for four years, lasting through 2016. Casdorph also used firm monies to renovate his home. Finally, Casdorph forged the name of a law firm member on three checks and gave the checks to local vendors. The total financial loss to the law firm and real estate company was at least $134, 755.44. Casdorph is no longer employed by the law firm/land company.
United States District Judge Joseph R. Goodwin presided over the hearing. Assistant United States Attorney Erik S. Goes handled the prosecution.
Follow us on Twitter: @SDWVNews and @USAttyStuart
###
Informational: Federal Court arraignmentsRead the Press Release
The U.S. Attorney’s Office announced that the following persons were arraigned or appeared this week before U.S. Magistrate judges on indictments handed down by the Grand Jury or on criminal complaints. The charging documents are merely accusations and defendants are presumed innocent until proven guilty:
Appearing in Billings before U.S. Magistrate Judge Timothy J. Cavan and pleading not guilty on June 25 was:
Maxwell West, 29, of Billings, on charges of passing/uttering counterfeit obligations or security of the United States. If convicted of the most serious crime, West faces a maximum 20 years in prison, a $250,000 fine and three years of supervised release. He was detained pending further proceedings. The case was investigated by the Secret Service. Pacer case reference. 17-141.
Nicholas John Montano, 34, of Billings, on charges of conspiracy to possess with intent to distribute methamphetamine and possession with intent to distribute meth. If convicted of the most serious crime, Montano faces a minimum mandatory 10 years to life in prison, a $10 million fine and at least five years of supervised release. Montano was detained pending further proceedings. The case was investigated by the FBI’s Transnational Organized Crime West unit. Pacer case reference. 18-123.
Appearing on June 27 was:
Byrne Martin Mestas, 62, of Billings, Steven Paul Furlong, 49, of Billings, and Jerry Ray Schuster, 55, of Billings, on charges of conspiracy to possess with intent to distribute meth, and possession with intent to distribute meth. If convicted of the most serious crime, Mestas, Furlong and Schuster face a minimum mandatory 10 years to life in prison, a $10 million fine and at least five years of supervised release. All three co-defendants were detained pending further proceedings. The case was investigated by the FBI task force and the Eastern Montana High Intensity Drug Trafficking Area Task Force. Pacer case reference. 19-88.
Michael Armando Sanchez, 27, of Bakersfield, Ca, on charges of conspiracy to possess with intent to distribute heroin and possession with intent to distribute controlled substances. If convicted of the most serious crime, Sanchez faces a minimum mandatory 10 years to life in prison, a $10 million fine and at least five years of supervised release. Sanchez was detained pending further proceedings. The case was in investigated by the FBI task force and the Eastern Montana High Intensity Drug Trafficking Area Task Force. Pacer case reference. 19-87.
Dawn Marie Davis, also known as Dawn Marie Hinebauch, 33, of Laurel, on charges of conspiracy to possess with intent to distribute meth and distribution of meth. If convicted of the most serious crime,
Davis faces a minimum five years to 40 years in prison, a $5 million fine and at least four years of supervised release. Davis was detained pending further proceedings. The case was investigated by the FBI task force and the Eastern Montana High Intensity Drug Trafficking Area Task Force. Pacer case reference. 19-89.Havalah Anne Ireland, 32, of Billings, on charges of conspiracy to possess with intent to distribute meth and possession with intent to distribute meth. If convicted of the most serious crime, Ireland faces a minimum mandatory 10 years to life in prison, a $10 million fine and at least five years of supervised release. The case was investigated by the FBI task force and the Eastern Montana High Intensity Drug Trafficking Area Task Force. Pacer case reference. 19-83.
Appearing in Great Falls before U.S. Magistrate Judge John T. Johnston and pleading not guilty on June 25 was:
Delwin Paul Calflooking, Sr., 37, of Browning, on charges of assault resulting in serious bodily injury, strangulation and assault resulting in substantial bodily injury to a dating partner. If convicted of the most serious crime, Calflooking faces a maximum 10 years in prison, a $250,000 fine and three years of supervised release. Calflooking was detained pending further proceedings. The case was investigated by the FBI. Pacer case reference. 19-42.
Appearing on June 26 was:
Nicole Smith, 34, Cut Bank, on charges of possession with intent to distribute. If convicted of the most serious crime, Smith faces a minimum mandatory 10 years to life in prison, a $10 million fine and five years of supervised release. Smith was detained pending further proceedings. The case was investigated by the FBI, Glacier County Sheriff’s Office and Blackfeet Tribal law enforcement. Pacer case reference. 19-46.
If any of the above cases are of interest to your media organization and the community it serves, we encourage you to monitor the progress of the case regularly through the U.S. District Court calendar and the PACER system.
To establish a PACER account, which will allow you to review documents filed in the case, please go to, http://www.pacer.gov/register.html. To access the district court’s calendar, please go to https://ecf.mtd.uscourts.gov/cgi-bin/PublicCalendar.pl.
XXX
Health Care Foundation Agrees to Pay $1.1 Million to Resolve Claims It Failed to Perform Background Checks, Fraudulently Billed United States for Community Service GrantsRead the Press Release
CAMDEN, N.J. – A health care foundation and two related companies have agreed to pay $1.1 million to resolve claims arising from their administration of federally funded community service grants, U.S. Attorneys Craig Carpenito, District of New Jersey, and William M. McSwain, Eastern District – Pennsylvania, announced today.
From 2012 until 2017, Our Lady of Lourdes Health Foundation and two related companies administered multiple grants funded through the Corporation for National and Community Service (CNCS)’s Senior Corps program. These included the Foster Grandparent Program, which places seniors in school and community settings to work with youth with exceptional needs, and the Senior Companion Program, which places seniors in community and residential settings to assist seniors who have difficulty with tasks of daily living. These programs provide small hourly stipends to the volunteers performing these services, who undergo training and must clear criminal history checks to ensure their suitability for the work.
From 2014 until 2017, Lourdes either failed to perform these criminal history checks or failed to keep records of doing so. As a result, 46 individuals were permitted to work on an FGP or SCP project without any documentation that they received one or more of the required criminal history checks. When a monitoring visit was scheduled in 2017, Lourdes employees cut-and-pasted other background checks in an attempt to conceal this failure from CNCS officials.
Lourdes’ employees – including two program supervisors – falsely completed time sheets showing program participants working hours that were impossible, because the locations at which they were purportedly working were closed.
When the United States commenced its formal investigation in 2017 and brought these issues to the attention of senior Lourdes management, Lourdes voluntarily relinquished the grants immediately and terminated all of the employees who had participated in the grant administration. Lourdes has actively cooperated with the United States since its senior management was advised of the issues in the grant programs. As part of this cooperation, it performed appropriate criminal history checks on all program participants and determined that all 46 individuals would have been permitted to participate in the programs had those checks been timely performed.
“Just as important as the work these volunteers do is the system that has been set up to ensure that they have been thoroughly vetted,” U.S. Attorney Carpenito said. “Whether they failed to keep accurate records of the results of these criminal background checks – or just failed to do them – the results were the same. Our Lady of Lourdes potentially put their clients’ safety at risk. And billing for no-show employees cannot be tolerated, especially when taxpayer dollars are being spent.”
“Criminal history checks are a critical protection for the vulnerable populations with whom Senior Companions and Foster Grandparents work,” U.S. Attorney McSwain said. “Strict compliance with the requirements for these essential safeguards is the surest way to be sure that predators do not gain access to potential victims. And every federal contractor, including community service organizations, is required to honestly and openly report the work that its employees perform. Every dollar spent on an hour that was not really worked is one that is not available to support other community service efforts.
“This fraud deprived school children and senior citizens of promised services and jeopardized their safety with bogus criminal history checks for the volunteers who served them,” CNCS’s Inspector General Deborah J. Jeffrey said. “We hope that the substantial penalties included in this settlement will deter other grantees from similar misconduct. We commend our partners at the Department of Justice for their outstanding efforts in pursuing fraud against national service programs.”
U.S. Attorneys Carpenito and McSwain praised Lourdes’ work in addressing the issues in these programs: “We appreciate the seriousness with which Lourdes senior management has taken this issue and the prompt, aggressive remedial actions that they took to prevent further harm to CNCS programs and potential harm to vulnerable communities. We hope this settlement will serve as a message to other senior managers to be vigilant in overseeing government-funded programs and to ensure that their employees do not attempt to conceal any non-compliance.”
This investigation was conducted jointly by the U.S. Attorney’s Offices for the District of New Jersey and the Eastern District of Pennsylvania, as well as the CNCS Office of Inspector General. Assistant U.S. Attorneys Jessica O’Neill of the District of New Jersey and Paul W. Kaufman and Veronica Finkelstein of the Eastern District of Pennsylvania handled the investigation and settlement.
The claims resolved by the settlement are allegations only; there has been no determination of liability.
19-189
Harrison County woman sentenced for role in methamphetamine distribution operationRead the Press Release
CLARKSBURG, WEST VIRGINIA – Stormetta Hawkins, of Clarksburg, West Virginia, was sentenced today to 12 months incarceration for her role in a methamphetamine distribution operation, United States Attorney Bill Powell announced.
Hawkins, age 26, pled guilty to one count of “Distribution of Methamphetamine” in March 2019. Hawkins admitted to selling methamphetamine in July 2018 in Harrison County.Assistant U.S. Attorney Zelda E. Wesley is prosecuting the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Greater Harrison Drug & Violent Crimes Task Force, a HIDTA-funded initiative, investigated. The United States Marshal Service assisted.
The investigation was funded in part by the federal Organized Crime Drug Enforcement Task Force Program (OCDETF). The OCDETF program supplies critical federal funding and coordination that allows federal and state agencies to work together to successfully identify, investigate, and prosecute major interstate and international drug trafficking organizations and other criminal enterprises.
U.S. District Judge Thomas S. Kleeh presided.
Gang Leader Sentenced to 17 Years in Prison for Violent Crime in Aid of RacketeeringRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today that LEONARD MATHEWS was sentenced to 17 years in prison for ordering a shooting that left three people injured, and for distributing crack cocaine. MATHEWS was convicted of assault with a dangerous weapon in aid of racketeering, as well as firearms, ammunition, and crack cocaine distribution offenses following a seven-day jury trial in October 2018. The sentence was imposed by U.S. District Judge J. Paul Oetken.
According to allegations in the Indictment and evidence introduced at trial:
MATHEWS is a leader, or “big homie,” in the Gangsta Milla Bloods, or “GMB,” a subset of the United Bloods Nation gang that operates in the Bronx and engages in racketeering activity, including narcotics distribution. On October 20, 2017, MATHEWS ordered a subordinate gang member to shoot someone with whom MATHEWS previously had a physical altercation. The shooting resulted in the injury of three innocent bystanders on Morris Avenue between East Kingsbridge Road and East 196th Street in the Bronx. On the night of the shooting, following a closed-door meeting with MATHEWS and other members of the gang, the same Bloods foot soldier that MATHEWS ordered to do the shooting stabbed and left for dead one of the principal witnesses to the shooting.
* * *
Judge Oetken sentenced MATHEWS, 27, of the Bronx, New York, to 84 months in prison on one count of aiding and abetting or willfully causing assault with a dangerous weapon in aid of racketeering, one count of aiding and abetting or willfully causing the possession of ammunition by a felon, and one count of distribution and possession with intent to distribute crack cocaine. In addition, Judge Oetken sentenced MATHEWS to a mandatory minimum sentence of 10 years in prison for one count of aiding and abetting or willfully causing the discharge of a firearm during and in relation to a crime of violence, to be served consecutively to the 84-month sentence imposed on the other counts.
Mr. Berman praised the investigative efforts of the Bronx Violent Crimes Squad of the New York City Police Department.
The case is being prosecuted by the Office’s General Crimes Unit. Assistant United States Attorneys Justin V. Rodriguez, Dominic A. Gentile, and Emil J. Bove III are in charge of the prosecution.
Forsyth County Man Sentenced to 13-1/2 Years in Prison for Distributing Child PornographyRead the Press Release
GREENSBORO, N.C. – A Forsyth County man who pleaded guilty to possession of child pornography was sentenced to 13-1/2 years in prison today, announced Matthew G.T. Martin, United States Attorney for the Middle District of North Carolina.
KIP LANDON KALE, 38, of Lewisville, North Carolina, pleaded guilty on March 4, 2019, to one count of distribution of child pornography. He was sentenced today by United States District Judge N. Carlton Tilley, Jr. to 162 months of imprisonment followed by 25 years of supervised release. He was ordered to pay $5,000.00 in restitution to a victim depicted in a video he distributed.
In 2018, KALE was convicted of Possession of Obscenity with Intent to Disseminate in Davidson County and placed on probation. On January 1, 2019, a Federal Bureau of Investigation (FBI) Online Covert Employee (OCE) began communicating with “rockslyde007,” later identified as KALE, using a mobile messaging application. The OCE saw that rockslyde007 belonged to a group using that application known to be associated with trafficking child pornography, and engaged rockslyde007 in an online chat. User rockslyde007 sent the OCE two child pornography videos involving prepubescent minors and a hyperlink to a cloud storage account containing 56 additional child pornography videos. During the chat with the OCE, which continued until January 4, 2019, rockslyde007 claimed to have sexually exploited two minors under the age of ten.
On January 4, 2019, the FBI’s investigation traced IP addresses used by rockslyde007 to KALE’s residence and his place of employment. FBI agents responded to KALE’s residence the same day and, after confirming his phone matched the one used by rockslyde007, placed him under arrest.
This case was investigated by the Federal Bureau of Investigation, prosecuted by Assistant United States Attorney Eric L. Iverson, and brought as part of Project Safe Childhood, a nationwide initiative by the Department of Justice to combat online child sexual exploitation and abuse. Led by United States Attorneys' 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.
###
Former Wall Street Trader Charged in Manhattan Federal Court for Ponzi SchemeRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, and Angel M. Melendez, the Special Agent-in-Charge of the New York Field Office of Homeland Security Investigations, announced today the unsealing of a Complaint in Manhattan federal court charging PAUL A. RINFRET with securities fraud and wire fraud charges. The Complaint alleges that RINFRET engaged in a years-long scheme to defraud investors by selling limited partnership interests in an entity through which RINFRET purported to trade in futures contracts relating to the S&P 500 utilizing a bespoke algorithm he had developed. RINFRET allegedly touted extremely high returns on his trading. In truth and in fact, as alleged, RINFRET simply stole most of the investors’ money in order to fund his lavish lifestyle. RINFRET was arrested this morning in Manhasset, New York, and will be presented this afternoon before Magistrate Judge Robert W. Lehrburger in Manhattan federal court.
Manhattan U.S. Attorney Geoffrey S. Berman said: “As alleged, Paul Rinfret deceived investors at every step: He lied about his past returns to get them to invest. He lied about having invested all of their money, when he was actually spending much of it on things like jewelry, cars, and a Hamptons vacation home. He lied about how their money was growing. His alleged lies stop today. We will work tirelessly with our law enforcement partners to stop this kind of alleged Ponzi scheme in its tracks and bring defendants like Rinfret to justice.”
Special Agent-in-Charge Melendez said: “As alleged, Paul Rinfret willfully and continually defrauded his investors, the very people he was tasked with serving, in a multimillion-dollar Ponzi scheme that served to enrich only him. The special agents of our El Dorado Task Force will continue to expose such fraud at the national and international levels and assure that such financial predators are brought to justice.”
As alleged in the Complaint unsealed today in Manhattan federal court:[1]
From at least 2016 through 2019, RINFRET engaged in a scheme to defraud potential and actual investors in an entity called Plandome Partners L.P. for his own personal gain and for the gain of his family members. RINFRET offered potential investors the ability to invest in Plandome Partners through the purchase of limited partnership interests. In soliciting investments, RINFRET falsely represented to potential and actual investors (the “Victims”) that he would use all of their investment funds to trade futures contracts tied to the Standard & Poor’s 500 index using a propriety trading algorithm he had developed, taking for himself a fee equivalent to 25% of the net profits on the trades.
Through his fraudulent scheme, RINFRET obtained more than $19 million in total from approximately six Victims on the false claim that he would utilize their investment funds for trading. RINFRET’s lies and misrepresentations were varied and many. For example, RINFRET claimed that Plandome Partners traded through certain brokerage accounts, one of which simply did not exist, and two of which were not open at a time when RINFRET claimed to be trading in those accounts.
Further, RINFRET used only a small portion of the Victims’ invested funds to engage in actual trading. Instead, RINFRET used most of the Victims’ money to purchase luxury goods and high-end vacation rentals for himself and family members. For example, RINFRET used the Plandome Partners account to spend almost $50,000 on a luxury Hamptons vacation rental, more than $40,000 on jewelry, and tens of thousands of dollars on the event venue where his son held his engagement party.
When RINFRET did actually engage in trading with Victims’ funds, he generated losses. But, to prevent his Victims from seeking a return of their money, and to induce additional investments, RINFRET falsely reported excellent investment performance results to the Victims through false and fraudulent monthly account statements that RINFRET typically emailed to the Victims. RINFRET also sent fabricated brokerage account statements to the Victims.
* * *
RINFRET, 70, of Manhasset, New York, is charged with one count of wire fraud, which carries a maximum sentence of 20 years in prison, and one count of securities fraud, which carries a maximum sentence of 20 years in prison. The statutory maximum and minimum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Anyone with information about the crimes charged in the Complaint should call the United States Attorney’s Office at 866-874-8900.
Mr. Berman praised the investigative work of the New York Field Office of Homeland Security Investigations. He also thanked the Newark Field Office of Homeland Security Investigations, under the direction of Special Agent-in-Charge Brian Michael. Mr. Berman also thanked the United States Postal Inspection Service, the United States Internal Revenue Service, the New York City Police Department, and the New York City Sherriff’s Office, which assisted in the investigation. Mr. Berman also thanked the Securities and Exchange Commission, which has brought and filed a civil enforcement action against the defendant.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Robert L. Boone and Amanda Kramer are in charge of the prosecution.
The charges contained in the Complaint are merely accusations, and the defendant is 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.
Former U.S. Navy Member Sentenced for Credit Card Fraud and Identity Theft SchemeRead the Press Release
NEWS RELEASE SUMMARY – June 28, 2019
SAN DIEGO – Fedrick Emery of San Diego was sentenced in federal court today to 45 months in custody and 3 years of supervised release for a fraud scheme he began while an active duty member of the U.S. Navy. According to his plea agreement, Emery and his co-conspirators obtained credit card numbers belonging to real individuals and created counterfeit credit cards and gift cards that Emery then used at over twenty Marine Corps Exchange (“MCX”) locations and Navy Exchange (“NEX”) locations in San Diego and around the country. Between April 2017 and February 2018, Emery’s fraud resulted in a loss of over $75,000 to the MCX and NEX.
At the same time, from approximately December 2017 to May 2018, Emery stole the identities of four individuals and used their personal information to obtain car loans, personal loans, and credit cards. With the stolen information, Emery purchased at least seven luxury automobiles and racked up thousands of dollars in debt that he immediately defaulted on. In all, Emery’s bank fraud resulted in a loss of over $290,000 to nine different banks.
“The financial toll exacted by identity theft can be crippling, and the emotional trauma can be equally devastating,” said United States Attorney Robert S. Brewer. “These were not victimless crimes. This office will vigorously prosecute those who cavalierly steal the identities of honest citizens and compromise the integrity our financial institutions.”
“This plea is the result of successful investigative efforts between NCIS and our partner agencies,” said NCIS Southwest Field Office Special Agent in Charge Garrett Waugh. “Fedrick Emery used fraudulent credit cards to defraud U.S. Navy and U.S. Marine Corps Exchanges, and used the identities of numerous unsuspecting victims to obtain bank loans and purchase vehicles. NCIS appreciates the assistance of our partners in combating fraud that decreases Department of the Navy readiness and wastes taxpayer money.”
According to court documents, during the conspiracy Emery and his co-conspirators referred to what they were doing as “New Money.” Emery flaunted his unearned wealth on Instagram, posting pictures of himself in the luxury automobiles he purchased using the identities of others, and with stacks of cash. Defendant was discharged in absentia from the U.S. Navy under other than honorable conditions in October 2017.
DEFENDANT Case Number 18cr3230-JLS
Fedrick Emery Age: 23 San Diego, CA
SUMMARY OF CHARGES
Conspiracy – Title 18, U.S.C., Section 371
Maximum penalty: 5 years’ imprisonment and $250,000 fine
Aggravated Identity Theft – Title 18 U.S.C., Section 1028A
Penalty – Mandatory two years consecutive imprisonment, and $250,000 fine
AGENCY
Naval Criminal Investigative Service
United States Secret Service
El Cajon Police Department
Former U.S. Government Contractor Pleads Guilty to Falsifying Training CertificatesRead the Press Release
A former U.S. government contractor pleaded guilty today to making counterfeit training certificates for individuals seeking employment on government contracts in Afghanistan.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, Special Inspector General for Afghanistan Reconstruction (SIGAR) John F. Sopko, Special Agent in Charge Robert E. Craig Jr. of the Defense Criminal Investigative Service (DCIS) Mid-Atlantic Field Office, Director Frank Robey of the U.S. Army Criminal Investigation Command’s (CID) Major Procurement Fraud Unit and Assistant Director Robert Johnson of the FBI’s Criminal Investigative Division made the announcement.
Antonio Jones, 40, of Yorktown, Virginia, pleaded guilty to one count of making false statements before U.S. District Judge Donald C. Coggins of the District of South Carolina. Sentencing has not yet been scheduled.
As part of his guilty plea, Jones admitted to making and/or causing to have made false Department of Transportation hazardous material (HAZMAT) training certificates to help an individual get a job handling HAZMAT in Afghanistan. A South Carolina-based contractor accepted the fake HAZMAT certificate as proof that Jones’s client had attended a training course prescribed by federal regulation and was otherwise suitable for employment when in fact, the client had not attended the HAZMAT course or any other HAZMAT course, Jones admitted.
Jones was charged in a 13-count indictment on Dec. 12, 2018. The indictment alleges that he and a co-conspirator purported to offer job placement services to individuals seeking employment in Afghanistan and elsewhere. In fact, according to the indictment, they created fake training certificates and false resumes to make their clients appear more qualified than they actually were, and used the false documents to apply for jobs on their clients’ behalf.
This case was investigated by SIGAR, the FBI, DCIS and the U.S. Army CID. The case is being prosecuted by Trial Attorney Michael P. McCarthy of the Criminal Division’s Fraud Section.
Former Superintendent of Rockbridge County Regional Jail Charged in Superseding IndictedRead the Press Release
Lynchburg, VIRGINIA – A federal grand jury sitting in U.S. District Court for the Western District of Virginia in Roanoke returned a superseding indictment yesterday. The superseding indictment still contains the original charges against two former Rockbridge County Regional Jail officials, including federal civil rights violations, falsifying documents to obstruct justice, but also charges the former superintendent of the jail with mail fraud, and conspiracy to commit mail fraud. First Assistant United States Attorney Daniel P. Bubar and David Archey, Special Agent in Charge of the FBI’s Richmond Division made the announcement.
In a superseding indictment returned yesterday, the grand jury charged John Marshal Higgins, 61, of Lexington, Va., with four counts of deprivation of rights under color of law, with two of the four counts alleging that Higgins denied detainees medical care of their serious medical needs, resulting in bodily injury, two counts of conspiracy to commit mail fraud, and 15 counts of mail fraud.
In addition, Gary Andrew Hassler, 59, of Lexington, Va., is charged with two counts of falsifying documents in order to obstruct a federal investigation.
According to the superseding indictment, during his tenure as superintendent of the jail, Higgins, acting under the color of law, failed to protect the rights of inmates at the Rockbridge County Regional Jail from physical abuse, which resulted in serious bodily injury to the inmates.
In addition, the indictment alleges that Higgins, acting under the color of law, failed to protect the rights of inmates at the regional jail by failing to provide inmates with medical treatment, resulting in bodily injury.
The indictment also accuses Hassler, the former head nurse at Rockbridge County Regional Jail, with falsifying medical documents to impede a federal investigation. Specifically, on or about March 5, 2017, the indictment claims that Hassler falsified a jail medical log for an inmate by falsely claiming that on February 28, 2017, the inmate refused his medication. Additionally, Hassler is accused of falsifying a Rockbridge Regional Jail Incident Report dated March 5, 2017 by falsely reporting an inmate refused medical care on March 1, 2017.
The new charges in the superseding the indictment allege that Higgins, while superintendent of the jail, agreed to accept prescription drugs for his own personal use without charge from a pharmaceutical company contracted to provide medication to inmates at the Rockbridge Regional Jail in exchange for the jail maintaining a business relationship with the pharmaceutical company.
Furthermore, the new charges in the superseding indictment allege that Higgins agreed to accept things of value from the family of an inmate at the Rockbridge Regional Jail in exchange for providing preferential treatment to the inmate.
The investigation of the case was conducted by the Federal Bureau of Investigation and the Virginia State Police. The Commonwealth Attorney’s Office for Rockbridge County assisted with the investigation. Assistant United States Attorneys Zachary T. Lee and Matthew Miller will prosecute the case for the United States.
A Grand Jury Indictment is only a charge and not evidence of guilt. The defendants are entitled to a fair trial with the burden on the government to prove guilt beyond a reasonable doubt.
Former Steel Valley Authority Financial Manager Sentenced to Prison for EmbezzlementRead the Press Release
PITTSBURGH - A resident of Westmoreland County has been sentenced in federal court to one-and-one-half years’ (18 months’) incarceration and five years of supervised release on her conviction of bank fraud and mail fraud, United States Attorney Scott W. Brady announced today.
United States District Judge Cathy Bissoon imposed the sentence on Nicolette Gizzi, age 46, of North Huntingdon, PA.
According to information presented to the court, from December 2009 through approximately June 2016, Gizzi, who was employed as the Financial Manager for Steel Valley Authority, embezzled by issuing checks to herself and her credit card company, without authorization, and then forging the required signatures. The checks were drawn on Steel Valley Authority’s business bank account. Steel Valley Authority is funded primarily by federal grants. Additionally, Gizzi, who has a prior federal fraud conviction in South Carolina, defrauded the United States Attorney’s Office for the District of South Carolina as it attempted to collect restitution for her previous victim.
Prior to imposing sentence, Judge Bissoon imposed an obstruction of justice sentencing enhancement based on false statements Gizzi made to the United States Probation Office during the course of a Presentence Interview.
U.S. Attorney Brady said, "Nicolette Guzzi perpetrated her fraud scheme on an economic development organization that is primarily funded through grants from the U.S. Department of Labor. An important part of our work is ensuring that public monies are used for their intended purposes, as we have demonstrated through this prosecution."
"Nicolette Gizzi devised a scheme to embezzle over $82,000 in Workforce Innovation and Opportunity Act funds from her employer at the expense of job seekers who were eligible for those resources. We will continue to work with our law enforcement partners and the U.S. Department of Labor’s Employment Training Administration to protect the integrity of services designed to strengthen and improve America’s workforce," said Richard Deer, Special Agent-in-Charge, Philadelphia Region, U.S. Department of Labor Office of Inspector General.
Assistant United States Attorney Lee J. Karl prosecuted this case on behalf of the government.
United States Attorney Brady commended the U.S. Department of Labor, Office of Inspector General, the Federal Bureau of Investigation and the U.S. Department of Housing and Urban Development, Office of Inspector General for the investigation leading to the successful prosecution of Gizzi.
Former Microsoft Director of Sports Marketing Sentenced to 28 Months in Prison for Wire FraudRead the Press Release
The former Director of Sports Marketing and Alliances at Microsoft was sentenced today in U.S. District Court in Seattle to 28 months in prison, and three years of supervised release for wire fraud for his scheme to profit by stealing from Microsoft. JEFF TRAN, a/k/a TRUNG TRAN, 45 of Seattle, used his position at Microsoft to attempt to steal more than $1.5 million through the creation and submission of fraudulent invoices and the unauthorized use of other Microsoft assets. At the sentencing hearing Chief U.S. District Judge Ricardo S. Martinez asked TRAN why he stolen the money. TRAN told the court he was still trying to answer why he did it.
According to records filed in the case, TRAN oversaw Microsoft’s promotional relationship with the National Football League (NFL). Tran’s scheme began in January of 2016. Tran, who was responsible for distributing Microsoft’s Super Bowl tickets to Microsoft employees, secretly misappropriated over $40,000 worth of 2016 Super Bowl tickets and sold them to a New York ticket broker. He repeated this activity the following year, this misappropriating tickets worth more than $200,000 for the 2017 Super Bowl.
Tran continued his theft after the 2017 Super Bowl. In March 2017, TRAN persuaded a Microsoft vendor to invoice Microsoft $775,000 for supposed services the vendor had never provided. Tran explained the request by telling the vendor the services had been provided by another company that could not bill Microsoft directly because it had not gone through Microsoft’s accreditation process. At Tran’s direction, Microsoft paid the $775,000 invoice to the vendor, and the vendor forwarded the proceeds to Tran.
In July 2017, Tran attempted to repeat the invoicing scheme, and asked the vendor to prepare a $670,000 invoice for services it had not provided. This time, the vendor became suspicious and reported Tran’s activity to Microsoft. When Microsoft confronted Tran, Tran made false statements to corporate investigators, destroyed evidence, and attempted to persuade witnesses to lie to investigators.
Tran returned $775,000 to Microsoft days after being confronted. Tran returned the remaining stolen funds after entering into a plea agreement with the government.
In asking for a prison sentence, prosecutors wrote to the Court that, “When Tran stole from Microsoft, the company was already paying him hundreds of thousands of dollars annually to do a job most people would envy. Tran’s decision to steal when he already occupied a lucrative and privileged position makes his conduct more volitional, and the crime more reprehensible, than crimes committed by people who steal, deal drugs, or commit other crime to put food on the table.”
TRAN has already paid restitution to Microsoft of $1,036,000. Chief Judge Martinez also imposed a $50,000 fine.
The case was investigated by the FBI. The case was prosecuted by Assistant United States Attorney Seth Wilkinson.
Former Broward County Residents Charged with Export Control Violations for Illegally Exporting Hundreds of Parts for AR-15 Assault RiflesRead the Press Release
Two former Broward County residents were arrested on June 26, 2019, based on a complaint charging them with conspiracy to violate and attempted violations of the Arms Export Control Act (AECA) and International Traffic in Arms Regulations (ITAR) (18 U.S.C. 371 and 22 U.S.C. 2778).
Ariana Fajardo Orshan, U.S. Attorney for the Southern District of Florida, and Anthony Salisbury, Special Agent in Charge, Homeland Security Investigations (HSI), Miami Field Office, made the announcement.
John James Peterson, 60, and Brunella Zuppone, 67, were charged with conspiracy to violate the AECA and ITAR, and attempts to illegally export to Argentina defense articles, specifically, parts and components for AR-15 assault rifles, which were smuggled across international borders by a transnational weapons trafficking group in Argentina. They each had their initial appearance before U.S. Magistrate Judge Lisette M. Reid.
According to the complaint and other court documents, Peterson and Zuppone illegally exported without a required license from the U.S. Department of State, to the Argentine weapons trafficking organization, thousands of AR-15 assault rifle parts. The investigative efforts of HSI agents in the Miami Field Office along with HSI agents stationed in Argentina, and their proactive cooperation with Argentine law enforcement officials between October and December 2019, led to the execution of search warrants in Florida and Argentina that resulted in the seizure of the equivalent of fifty-two (52) AR-15 assault rifles in Florida and in Argentina: 189 long arms, 156 handguns, one mortar round, one hand grenade, over 30,000 rounds of assorted caliber ammunition, five vehicles, and $110,000 in cash. On June 26, 2019, Argentina’s National Gendarmeria conducted an operation that led to the arrest of 25 subjects and the seizure of thousands of firearms and explosive materials.
U.S. Attorney Fajardo Orshan commended the investigative efforts of HSI, U.S. Customs and Border Protection and the U.S. Postal Inspection Service. The case is being prosecuted by Assistant U.S. Attorney Ricardo Del Toro and Trial Attorney Evan Turgeon of the Counterintelligence and Export Control Section of the Department of Justice’s National Security Division.
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 on http://pacer.flsd.uscourts.gov.
Florida Man Sentenced for Role in International Money Laundering SchemeRead the Press Release
BOSTON – A Florida man was sentenced yesterday in connection with his role in an international money laundering scheme designed to hide the illicit proceeds of business email compromise (BEC) schemes.
Angel De Jesus Lara Nieto, 26, of Fort Lauderdale, Fla., was sentenced by U.S. District Court Judge Richard G. Stearns to 41 months in prison and three years of supervised release. In March 2019, Lara pleaded guilty to one count of conspiracy to engage in money laundering.
According to court documents, Lara and his co-conspirators were members of an organization that engaged in wire fraud, money laundering, and related criminal activity. Lara recruited at least four others to act as money mules for the organization, meaning that each was served as the nominal owner of numerous shell companies and opened bank accounts in that company’s name for the purpose of receiving, withdrawing, and transferring proceeds of criminal activity. Lara himself also engaged in the same conduct—opening shell bank accounts and receiving fraud proceeds—personally laundering over one million dollars in fraudulent funds.
Lara was charged specifically for an incident that occurred in January 2018, where co-conspirators gained access to email accounts belonging to a Massachusetts attorney engaged in real estate closings. Emails sent from Lara’s co-conspirators to recipients in the District of Massachusetts in January and February of 2018 “spoofed” the real estate attorney’s account in a an attempt to cause the purchaser in a real estate transaction to transfer $475,000, which was intended to be used for payment in connection with a real estate transaction, to a shell account of a money mule recruited and controlled by Nieto. Fortunately, that attempted fraud was discovered before the wire transfer took place.
United States Andrew E. Lelling and Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Office, made the announcement today. Assistant U.S. Attorneys David J. D’Addio and Amy Harman Burkart of Lelling’s Cybercrime Unit are prosecuting the case.
Felon Pleads Guilty for Possessing a Firearm During Altercation at Galleria MallRead the Press Release
St. Louis, MO – Jermaine R. Clay, 23, of St. Louis, MO, pleaded guilty to one felony count of felon in possession of a firearm stemming from an altercation at the Galleria Mall. Clay appeared in federal court this afternoon before U.S. District Judge Rodney W. Sippel who accepted his plea and set his sentencing date for September 26, 2019.
According to court documents, on June 10, 2018, Clay was at the Galleria Mall when a fight broke out. After Richmond Heights Police Officers responded to the area, Clay was seen running across Brentwood Boulevard toward The Boulevard with a black satchel on his right side. Police pursued him. Clay pulled a black semi-automatic pistol from the satchel and threw it. Clay also threw the satchel. Clay continued running.
The satchel and firearm were both seized by law enforcement. The satchel contained six bags of marijuana, cocaine base, and a cell phone. The firearm was a loaded Smith & Wesson, MP40, with a 40 caliber magazine. The firearm was stolen.
Clay was later apprehended, and a computer check revealed that he was a convicted felon.
Clay faces a maximum sentence of ten years in prison and a fine of not more than a $250,000. He may be subject to a mandatory minimum sentence of 15 years and a maximum sentence greater than described. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
The Drug Enforcement Administration and the Richmond Heights Police Department investigated this case. Assistant United States Attorney Beth Orwick is handling the case for the U.S. Attorney’s Office.
Federal Inmate Sentenced to Four Months’ Imprisonment for EscapeRead the Press Release
SCRANTON – The United States Attorney’s Office for the Middle District of Pennsylvania announced that on June 27, 2019, United States District Court Judge James Munley sentenced Raymond Collazo, age 34, to four months of imprisonment, for escaping from federal custody.
According to United States Attorney David J. Freed, Collazo was a federal inmate at Schuylkill Federal Prison Camp (FCI Schuylkill), where he was serving a 130-month sentence for heroin trafficking and firearms offenses. Collazo absconded on March 15, 2018, but returned to custody shortly thereafter. Judge Munley imposed the four-month sentence to run consecutively to Collazo’s existing sentence.
The case was investigated by the U.S. Marshals Service and by Officers with FCI Schuylkill. Assistant United States Attorney Phillip J. Caraballo prosecuted the case.
# # #
Federal Grand Jury Indicts Montebello Man with Causing Fentanyl Overdose that Resulted in DeathRead the Press Release
LOS ANGELES – A Montebello resident has been charged by a federal grand jury with providing a woman a fatal dose of the synthetic opioid fentanyl.
Edwin Oliva, 28, was named Thursday in a superseding indictment with distribution of fentanyl resulting in death.
Oliva has been in federal custody since his arrest in this case on March 6. He was subsequently charged in an indictment with three felonies: possession with intent to distribute more than four pounds of heroin, possession with intent to distribute fentanyl, and carrying a firearm during and in relation to and possessing a firearm in furtherance of a drug trafficking crime. The three counts in the initial indictment are included in the four-count superseding indictment.
According to an affidavit in support of a criminal complaint filed in the case, Oliva told law enforcement officials that the victim was an acquaintance who arrived at his residence shortly after midnight on February 28. Oliva allegedly gave the victim drugs, which resulted in a fatal overdose. Oliva admitted to law enforcement that fentanyl was the drug he gave the victim, according to court documents. A pathologist employed by the Los Angeles County Medical Examiner-Coroner concluded the victim died as a result of the effects of fentanyl and alcohol.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Oliva previously entered not guilty to the charges in the initial indictment. He will be arraigned early next month on the superseding indictment. United States District Judge André Birotte Jr. previously scheduled a trial date of November 5 for this case.
If convicted of charge of distribution of fentanyl resulting in death, Oliva would face a mandatory minimum sentence of 20 years in federal prison and a statutory maximum sentence of life imprisonment. Additionally, the heroin-related offense carries a mandatory minimum 10-year sentence and a potential sentence of life in prison.
This matter was investigated by the Drug Enforcement Administration and the Montebello Police Department.
This case is being prosecuted by Assistant United States Attorney Gabe Podesta of the General Crimes Section.
Essex County Man Convicted of Wire Fraud and Aggravated Identity TheftRead the Press Release
NEWARK, N.J. – An Essex County, New Jersey, man was convicted for his role in a scheme to steal victims’ personal information, use it to obtain replacement credit cards and then use the cards to purchase high-value items from retailers, U.S. Attorney Craig Carpenito announced today.
Richard Adebayo, 42, of East Orange, New Jersey, was convicted June 27, 2019, on all counts of an indictment charging him with one count of conspiracy to commit wire fraud, 14 counts of wire fraud and two counts of aggravated identity theft following a nine-day trial before Judge Madeline Cox Arleo in Newark federal court. The jury deliberated one day before returning the guilty verdicts.
According to documents filed in this case and the evidence at trial:
Adebayo and Amos Peter Agbajaife, 41, of Newark, were originally charged by complaint on in September 2014 and indicted in January 2019. Adebayo was arrested in 2014 and Agbajaife remains at large.
From March 2014 to April 2014, Adebayo and Agbajaife fraudulently obtained personal identifying information, including dates of birth, Social Security numbers, and passwords, of credit card holders. They used the information to fraudulently obtain replacement credit cards in the victims’ names and then used the cards to purchase high-value items from retail stores.
Adebayo was carrying a laptop computer when he was arrested. A forensic analysis of the computer revealed the stolen identities, including names, Social Security numbers, dates of birth, addresses, bank account information, and credit card information of several victims. Law enforcement confirmed that more than $200,000 in fraudulent charges were incurred on the credit cards of the victims.
Each count of wire fraud and conspiracy to commit wire fraud carries a maximum potential penalty of 20 years in prison and a fine of up to $250,000, or twice the gain to the defendant or loss to another, whichever is greater. The counts of aggravated identity theft carries a mandatory term of two years in prison, which must run consecutively to any term of imprisonment imposed for other counts of the indictment. Sentencing is scheduled for Sept. 25, 2019.
U.S. Attorney Carpenito credited special agents of the U.S. Department of Homeland Security, Homeland Security Investigations (HSI), under the direction of Special Agent in Charge Brian Michael, with the investigation leading to conviction.
The government is represented by Assistant U.S. Attorneys Catherine Murphy and Jamel Semper of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
The pending charges against Agbajaife are merely accusations, and he is presumed innocent unless and until proven guilty.
Defense counsel: Christopher D. Adams Esq., Holmdel, New Jersey; and Tara Breslow-Testa Esq., Red Bank, New Jersey
Encompass Health Agrees to Pay $48 Million to Resolve False Claims Act Allegations Relating to its Inpatient Rehabilitation FacilitiesRead the Press Release
Encompass Health Corporation (formerly known as HealthSouth Corporation), the nation’s largest operator of inpatient rehabilitation facilities (IRFs), has agreed to pay $48 million to resolve allegations that some of its IRFs provided inaccurate information to Medicare to maintain their status as an IRF and to earn a higher rate of reimbursement, and that some admissions to its IRFs were not medically necessary.
“This settlement demonstrates our commitment to ensuring that those who participate in federal healthcare programs follow the rules,” said Assistant Attorney General Jody Hunt for the Department of Justice’s Civil Division. “Medicare and Medicaid providers who seek to profit inappropriately at the expense of taxpayers will be held accountable.”
Medicare and Medicaid use information about patients’ diagnoses to determine whether a facility is properly classified as an IRF, and to determine the level of reimbursement the facility is awarded for specific patients. The government alleged that beginning in 2007, in order to insure compliance with Medicare’s rules regarding classification as an IRF, and to increase Medicare reimbursement, some Encompass IRFs falsely diagnosed patients with what they referred to as “disuse myopathy” when there was no clinical evidence for this diagnosis. Additionally, Encompass IRFs allegedly admitted patients who were not eligible for admission to an IRF because they were too sick or disabled to participate in or benefit from intensive inpatient therapy.
“This important civil settlement concludes a lengthy, comprehensive investigation that brought to light a nationwide scheme that the government contends was intended to defraud our fragile public health programs,” said U.S. Attorney Maria Chapa Lopez. “In doing so, we confirm our commitment to civil health care fraud enforcement as a key component of the mission of our office.”
The settlements resolve allegations raised in three lawsuits filed by Dr. Emese Simon M.D., a former contract physician employed at an Encompass inpatient rehabilitation facility in Sarasota, Florida; Melissa Higgins the former Director of Therapy Operations at Encompass’s inpatient rehabilitation facility in Arlington, Texas; and Dr. Darius Clarke M.D. the former Medical Director at Encompass’s inpatient rehabilitation facility in Richmond, Virginia, and his company, Restorative Health & Wellness P.L.L.C. The lawsuits were filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private individuals to sue on behalf of the government for false claims and to share in any recovery. Here, the whistleblowers collective share of the settlement will be $12.4 million.
The settlement was the result of a coordinated effort by the Civil Division of the Department of Justice, the Unite States Attorney’s Office for the Middle District of Florida, and the U.S. Department of Health and Human Services Office of Inspector General.
The three cases are captioned United States ex rel. Simon, et al. v. HealthSouth Corp., et al.; Case No. 08-CV-236 (M.D. Fla.); United States ex rel. Higgins v. HealthSouth Corp.; Case No. 3:12 CV 2496 (N.D. Tex.); and United States ex rel. Clarke et al. v. HealthSouth Corp.; Case No. 1:12 CV 853 (E.D. Va.). The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Encompass Health Agrees to Pay $48 Million to Resolve False Claims Act Allegations Relating to Its Inpatient Rehabilitation FacilitiesRead the Press Release
WASHINGTON – Encompass Health Corporation (formerly known as HealthSouth Corporation), the nation’s largest operator of inpatient rehabilitation facilities (IRFs), has agreed to pay $48 million to resolve allegations that some of its IRFs provided inaccurate information to Medicare to maintain their status as an IRF and to earn a higher rate of reimbursement, and that some admissions to its IRFs were not medically necessary.
“This settlement demonstrates our commitment to ensuring that those who participate in federal healthcare programs follow the rules,” said Assistant Attorney General Jody Hunt for the Department of Justice’s Civil Division. “Medicare and Medicaid providers who seek to profit inappropriately at the expense of taxpayers will be held accountable.”
Medicare and Medicaid use information about patients’ diagnoses to determine whether a facility is properly classified as an IRF, and to determine the level of reimbursement the facility is awarded for specific patients. The government alleged that beginning in 2007, in order to insure compliance with Medicare’s rules regarding classification as an IRF, and to increase Medicare reimbursement, some Encompass IRFs falsely diagnosed patients with what they referred to as “disuse myopathy” when there was no clinical evidence for this diagnosis. Additionally, Encompass IRFs allegedly admitted patients who were not eligible for admission to an IRF because they were too sick or disabled to participate in or benefit from intensive inpatient therapy.
“This important civil settlement concludes a lengthy, comprehensive investigation that brought to light a nationwide scheme that the government contends was intended to defraud our fragile public health programs,” said U.S. Attorney Maria Chapa Lopez. “In doing so, we confirm our commitment to civil health care fraud enforcement as a key component of the mission of our office.”
The settlements resolve allegations raised in three lawsuits filed by Dr. Emese Simon M.D., a former contract physician employed at an Encompass inpatient rehabilitation facility in Sarasota, Florida; Melissa Higgins the former Director of Therapy Operations at Encompass’s inpatient rehabilitation facility in Arlington, Texas; and Dr. Darius Clarke M.D. the former Medical Director at Encompass’s inpatient rehabilitation facility in Richmond, Virginia, and his company, Restorative Health & Wellness P.L.L.C. The lawsuits were filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private individuals to sue on behalf of the government for false claims and to share in any recovery. Here, the whistleblowers collective share of the settlement will be $12.4 million.
The settlement was the result of a coordinated effort by the Civil Division of the Department of Justice, the Unite States Attorney’s Office for the Middle District of Florida, and the U.S. Department of Health and Human Services Office of Inspector General. In the Middle District of Florida, the case was handled by Assistant United States Attorney Sean O'Keefe.
The three cases are captioned United States ex rel. Simon, et al. v. HealthSouth Corp., et al.; Case No. 08-CV-236 (M.D. Fla.); United States ex rel. Higgins v. HealthSouth Corp.; Case No. 3:12 CV 2496 (N.D. Tex.); and United States ex rel. Clarke et al. v. HealthSouth Corp.; Case No. 1:12 CV 853 (E.D. Va.). The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Effingham Woman Sentenced to 6 1/2 Years in Federal Prison on Methamphetamine Related ChargesRead the Press Release
Melissa J. Reynolds, 28, of Effingham, Illinois, has been sentenced to 78 months in federal prison on methamphetamine-related charges, Steven D. Weinhoeft, U.S. Attorney for the Southern District of Illinois, announced today.
Reynolds previously pleaded guilty to four counts in a federal indictment. Count 1 charged that from January to October 2018, Reynolds conspired with others to distribute 5 grams or more of actual methamphetamine. Counts 2-4 charged that Reynolds distributed methamphetamine on three specified dates in June and July 2018. All of Reynolds’ crimes occurred in Effingham County.
The sentence imposed on Reynolds includes a four-year term of supervised release.
The investigation in this case was conducted by the Southeastern Illinois Drug Task Force.
Denver man sentenced to more than 20 years in prison for meth trafficking, firearms crimesRead the Press Release
BILLINGS—Nathan Thomas Trujillo, a Denver resident who admitted to trafficking methamphetamine in the Billings community, was sentenced on June 27 to 20 years and eight months in prison and five years of supervised release, said U.S. Attorney Kurt Alme.
Trujillo pleaded guilty in December to conspiracy to possess with intent to distribute meth, possession with intent to distribute meth and possession of a firearm in furtherance of a drug trafficking crime.
U.S. District Judge Susan P. Watters presided.
In August 2018, drug task force agents began investigating a Billings area dealer, later identified as Trujillo, but who was living under a stolen identity to avoid arrest on an outstanding warrant. Agents made multiple buys from a co-conspirator and learned that Trujillo traveled to Denver to obtain pound quantities for re-distribution in the Billings area.
Agents executed search warrants on Trujillo’s vehicle and apartment. From the vehicle, agents seized about 429 grams, for about 15 ounces, of meth from his vehicle, a 9mm pistol, a digital scale and plastic baggies. The 429 grams of meth is the equivalent of about 3,432 individual doses. Agents also found additional firearms, illegal drugs and drug paraphernalia. From Trujillo’s apartment, agents seized another firearm and more drug paraphernalia.
Assistant U.S. Attorney Colin Rubich prosecuted the case, which was investigated by the Eastern Montana High Intensity Drug Trafficking Area Task Force and the FBI task force.
The case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
XXX