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Friday 14 June 2019
York Man Sentenced to over 21 Years’ Imprisonment on Drug Trafficking ChargesRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Raul Cotto-Rivera, age 41, of York, Pennsylvania, was sentenced on June 11, 2019, to 262 months’ imprisonment followed by five years of supervised release by U.S. District Court Judge Yvette Kane for drug trafficking offenses.
According to United States Attorney David J. Freed, Cotto-Rivera was convicted in March 2018, after a three-day jury trial, of conspiracy to distribute 100 grams and more of heroin and 500 grams and more of cocaine hydrochloride, distribution of heroin (3 counts), possession with intent to distribute heroin and cocaine hydrochloride, distribution of marijuana and possession with intent to distribute cocaine base, cocaine hydrochloride and marijuana,
The charges stemmed from a number of controlled buys of heroin that were made by and through Cotto-Rivera in September and October of 2015. In October 2015, law enforcement obtained and executed a search warrant and located approximately $20,000 in United States currency, a drug ledger, drug packaging material and distribution quantities of cocaine and heroin all in the defendant’s home. While on release, Cotto-Rivera continued to sell drugs and was engaged in the distribution of marijuana from his store. A second search warrant executed in February 2017, located distribution quantities of marijuana and cocaine, drug packaging materials and a loaded stolen firearm.
The investigation was conducted by the FBI Safe Streets Task Force, the York County Drug Task Force, the Pennsylvania State Police, the York Area Regional Police Department, the West Manchester Township Police Department, the York County Sheriff’s Office, the Springettsbury Township Police Department, and the York County District Attorney’s Office. Assistant United States Attorneys Daryl F. Bloom and Carl Marchioli prosecuted the case.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
This case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.
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United States Penitentiary Canaan Inmate Pleads Guilty to Assault of Correctional Officer and Is Sentenced to Serve an Additional 15 Months in PrisonRead the Press Release
WILKES-BARRE - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Johnny Fletcher, age 41, formerly of South Carolina and currently an inmate at the United States Penitentiary Canaan, pleaded guilty on June 12, 2019, before Senior U.S. District Court Judge A. Richard Caputo, to assault on a correctional officer and was immediately sentenced to serve an additional 15 months in prison.
According to United States Attorney David J. Freed, Fletcher admitted to punching a correctional officer on February 5, 2019, after Fletcher set off a metal detector and refused to submit to a search by the correctional officer.
The case was investigated by the Federal Bureau of Investigation and the Bureau of Prisons Special Investigative Service. Assistant United States Attorney Robert J. O’Hara prosecuted the case.
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United States Files False Claims Act Complaint Against Two Compounding Pharmacies and Their Owner for Submitting Inflated Claims and Improperly Waiving Patient CopaymentsRead the Press Release
The Department of Justice announced today that the United States has filed a complaint in intervention against Smart Pharmacy Inc., and SP2 LLC, two compounding pharmacies located in Jacksonville, Florida. The complaint alleges that the pharmacies improperly included the drug aripiprazole, an atypical antipsychotic drug, in compounded pain creams in order to boost the pharmacies’ reimbursement for the prescriptions and that the pharmacies routinely waived patient copayment obligations. The government has also brought claims against Gregory Balotin, a co-owner of the pharmacies, for his involvement in the alleged schemes.
Aripiprazole, which is sold under the brand names Abilify, Abilify Maintena, and Aristada, is approved by the U.S. Food and Drug Administration to treat a number of psychological conditions such as schizophrenia, Tourette’s disorder, irritability associated with autistic disorder, and manic and mixed episodes associated with Bipolar I. The complaint alleges that the defendants crushed pills of aripiprazole and included them in compounded creams used topically for pain treatment while knowing that there was not an adequate clinical basis for adding aripiprazole to the compound. The complaint alleges that, by including the drug in the pain creams, the defendants substantially increased their reimbursement for prescriptions for the creams from Medicare Part D and TRICARE, the federal health care program for active duty military personnel, retirees, and their families.
The government’s complaint also alleges that the defendants improperly waived patient copayments. While copayments may be waived in certain unique circumstances, such as on the basis of financial hardship of the patient, the defendants are alleged to have routinely waived patient copayments without regard for whether a waiver was warranted.
“The Department of Justice will hold accountable health care providers that manipulate the system to improperly enrich themselves at the taxpayers’ expense,” said Assistant Attorney General Jody Hunt for the Department of Justice’s Civil Division. “Dispensing drugs for unproven uses and improperly waiving patient copayments erodes public trust in the health care system and increases the costs borne by federal health care programs.”
“This complaint addresses alarming misconduct by some of the largest compounding pharmacies in our district,” said U.S. Attorney for the Middle District of Florida Maria Chapa Lopez. “We intend to hold providers accountable under the False Claims Act when they put their own economic interests ahead of the medical needs of federal health program beneficiaries.”
“Fraud in government health programs may result in harm to vulnerable populations and needless taxpayer expense,” said Shimon R. Richmond, Special Agent in Charge of the Office of Inspector General for the U.S. Department of Health and Human Services. “All available resources will be used to aggressively investigate these allegations.”
“I applaud the Department of Justice for its continued efforts to hold compounding pharmacies accountable to the American taxpayer,” said Vice Adm. Raquel Bono, director of the Defense Health Agency. “The efforts of the Department of Justice safeguard the health care benefit for our service members, veterans and their families. The Defense Health Agency will continue working closely with the Justice Department, and other state and federal agencies to investigate all those who participated in fraudulent practices.”
“It is of utmost importance to protect the integrity of DoD programs by rooting out fraud, waste, and abuse that diverts and wastes precious American taxpayer dollars intended for our Warfighters, and their families. Allegations of providers unjustly enriching themselves will be met with a coordinated effort amongst all affected agencies to hold those accountable,” said the Defense Criminal Investigative Service Special Agent in Charge Cynthia Bruce, Southeast Field Office.
The lawsuits, United States ex rel. Sanchez v. Smart Pharmacy, Inc., et al., No. 14-cv-1453 (M.D. Fla.), and United States ex rel. Kohli v. Smart Pharmacy, Inc., et al., No. 16-cv-387 (M.D. Fla.), were originally filed in the U.S. District Court for the Middle District of Florida by Amy Sanchez and Ashok Kohli, two former employees of Smart Pharmacy. The lawsuits were filed under the qui tam or whistleblower provisions of the False Claims Act, which permit private parties to sue on behalf of the United States for false claims and to receive a share of any recovery. The Act permits the United States to intervene in such lawsuits, as the United States has done in these cases.
This matter is being handled by the Civil Division’s Commercial Litigation Branch and the U.S. Attorney’s Office for the Middle District of Florida, with assistance from the Defense Criminal Investigative Service, the Department of Health and Human Services Office of Inspector General, the Department of Veterans Affairs Office of Inspector General, the Department of Labor Office of Inspector General, and the Office of Personnel Management Office of Inspector General.
The claims asserted against the defendants are allegations only; there has been no determination of liability.
United States Files False Claims Act Complaint Against Two Compounding Pharmacies and Their Owner for Submitting Inflated Claims and Improperly Waiving Patient CopaymentsRead the Press Release
WASHINGTON – The Department of Justice announced today that the United States has filed a complaint in intervention against Smart Pharmacy Inc., and SP2 LLC, two compounding pharmacies located in Jacksonville, Florida. The complaint alleges that the pharmacies improperly included the drug aripiprazole, an atypical antipsychotic drug, in compounded pain creams in order to boost the pharmacies’ reimbursement for the prescriptions and that the pharmacies routinely waived patient copayment obligations. The government has also brought claims against Gregory Balotin, a co-owner of the pharmacies, for his involvement in the alleged schemes.
Aripiprazole, which is sold under the brand names Abilify, Abilify Maintena, and Aristada, is approved by the U.S. Food and Drug Administration to treat a number of psychological conditions such as schizophrenia, Tourette’s disorder, irritability associated with autistic disorder, and manic and mixed episodes associated with Bipolar I. The complaint alleges that the defendants crushed pills of aripiprazole and included them in compounded creams used topically for pain treatment while knowing that there was not an adequate clinical basis for adding aripiprazole to the compound. The complaint alleges that, by including the drug in the pain creams, the defendants substantially increased their reimbursement for prescriptions for the creams from Medicare Part D and TRICARE, the federal health care program for active duty military personnel, retirees, and their families.
The government’s complaint also alleges that the defendants improperly waived patient copayments. While copayments may be waived in certain unique circumstances, such as on the basis of financial hardship of the patient, the defendants are alleged to have routinely waived patient copayments without regard for whether a waiver was warranted.
“The Department of Justice will hold accountable health care providers that manipulate the system to improperly enrich themselves at the taxpayers’ expense,” said Assistant Attorney General Jody Hunt for the Department of Justice’s Civil Division. “Dispensing drugs for unproven uses and improperly waiving patient copayments erodes public trust in the health care system and increases the costs borne by federal health care programs.”
“This complaint addresses alarming misconduct by some of the largest compounding pharmacies in our district,” said U.S. Attorney for the Middle District of Florida Maria Chapa Lopez. “We intend to hold providers accountable under the False Claims Act when they put their own economic interests ahead of the medical needs of federal health program beneficiaries.”
“Fraud in government health programs may result in harm to vulnerable populations and needless taxpayer expense,” said Shimon R. Richmond, Special Agent in Charge of the Office of Inspector General for the U.S. Department of Health and Human Services. “All available resources will be used to aggressively investigate these allegations.”
“I applaud the Department of Justice for its continued efforts to hold compounding pharmacies accountable to the American taxpayer,” said Vice Adm. Raquel Bono, director of the Defense Health Agency. “The efforts of the Department of Justice safeguard the health care benefit for our service members, veterans and their families. The Defense Health Agency will continue working closely with the Justice Department, and other state and federal agencies to investigate all those who participated in fraudulent practices.”
“It is of utmost importance to protect the integrity of DoD programs by rooting out fraud, waste, and abuse that diverts and wastes precious American taxpayer dollars intended for our Warfighters, and their families. Allegations of providers unjustly enriching themselves will be met with a coordinated effort amongst all affected agencies to hold those accountable,” said the Defense Criminal Investigative Service Special Agent in Charge Cynthia Bruce, Southeast Field Office.
The lawsuits, United States ex rel. Sanchez v. Smart Pharmacy, Inc., et al., No. 14-cv-1453 (M.D. Fla.), and United States ex rel. Kohli v. Smart Pharmacy, Inc., et al., No. 16-cv-387 (M.D. Fla.), were originally filed in the U.S. District Court for the Middle District of Florida by Amy Sanchez and Ashok Kohli, two former employees of Smart Pharmacy. The lawsuits were filed under the qui tam or whistleblower provisions of the False Claims Act, which permit private parties to sue on behalf of the United States for false claims and to receive a share of any recovery. The Act permits the United States to intervene in such lawsuits, as the United States has done in these cases.
This matter is being handled by the Civil Division’s Commercial Litigation Branch and Assistant United States Attorney Collette B. Cunningham for the U.S. Attorney’s Office for the Middle District of Florida, with assistance from the Defense Criminal Investigative Service, the Department of Health and Human Services Office of Inspector General, the Department of Veterans Affairs Office of Inspector General, the Department of Labor Office of Inspector General, and the Office of Personnel Management Office of Inspector General.
The claims asserted against the defendants are allegations only; there has been no determination of liability.
US. Attorney Highlights Recent Project Safe Childhood ConvictionsRead the Press Release
Over the past two weeks, five defendants have pleaded guilty or have been sentenced in the Northern District of Oklahoma for sex crimes involving minors, announced U.S. Attorney Trent Shores. The prosecutions are part of the Department of Justice’s Project Safe Childhood initiative and come on the heels of Operation Broken Heart, a two-month, nationwide operation that netted almost 1,700 suspected online child sex offenders and identified 308 offenders who either produced child pornography or committed child sexual abuse.
The Project Safe Childhood initiative marshals federal, state, and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and identifies and rescues victims.
“Our Project Safe Childhood initiative is crucial to ferreting out criminal deviants who try to sexually exploit minors. We conduct local undercover sting operations as well as use cyber-based investigative techniques to identify these child predators,” said U.S. Attorney Shores. “As a prosecutor, I sought justice for victims of child sexual abuse, human trafficking, and child pornography. I know just how important these cases are, which is why we continue to prioritize them. We must get child predators off our streets and behind bars. I’m thankful for the aggressive prosecution of these cases by Assistant U.S. Attorneys Chris Nassar and Shannon Cozzoni. Moreover, our partnerships with local, state, and federal investigators are crucial to protecting children in northern Oklahoma. There is no more righteous cause than protecting children.”
Levi William Welker, 29, of Tulsa, was sentenced to 17 years in federal prison followed by seven years on supervised release for distribution of child pornography, enticing a minor, and tampering with a witness and evidence. In February 2016, Welker shared child pornography using a bit torrent file sharing network. Investigators initially discovered 68 images on a torrent file which was traced to Welker’s IP address. During a search, investigators located more than 7,000 image and video files of child pornography. Welker also admitted that he later used multiple social media apps and communications devices to manipulate and lure two minor children to engage in sexual activity with him. He pretended to be 16 years old and provided the victims with cell phones in order to secretly communicate. When one of the children’s parents became suspicious, they reported Welker to the Tulsa Police Department. After the investigation commenced, police discovered that Welker messaged one of the victim’s social media accounts, asking her to lie to police and destroy evidence. He also destroyed other digital evidence in an effort to thwart the investigation. The Court remanded Welker into the custody of the U.S. Marshals Service pending transfer to a U.S. Bureau of Prisons facility. The FBI and Tulsa Police Department investigated these crimes.
Kenny Wayne Brown, 52, of Gainesville, Texas, was sentenced to 10 years in federal prison followed by 10 years on supervised release for attempted coercion and enticement of a minor. From Sept. 6 to Sept. 28, 2018, Brown unknowingly initiated contact with an Internet Crimes Against Children task force officer from the Bristow Police Department who was posing as a minor female. Using social media, he engaged the “girl” in explicit sexual conversation and sent pornographic images of himself to the “girl.” He eventually arranged to travel from Texas to Bristow, Oklahoma, in order to engage in sexual activity. During the arrest at the arranged location, Brown attempted to flee from officers nearly striking them with his vehicle until he was eventually stopped and arrested. Investigators discovered that Brown was also charged with online solicitation in May 2018 in Texas. The Bristow Police Department conducted the investigation.
Jeffrey Scott Cooper, 46, of Broken Arrow, was sentenced to 87 months in federal prison followed by five years on supervised release for attempted receipt of child pornography. From Dec. 18 to Dec. 20, 2018, Cooper unknowingly made contact with an officer from the Tulsa Police Department’s Cyber Crimes Task Force posing as a minor female. Using a social media app, Cooper started the conversation with what he believed to be a minor female. He then engaged the “girl” in explicit sexual conversation, eventually arranging to meet in order to engage in sexual activity. On Dec. 20, 2018, investigators arrested Cooper after he arrived in his company car at the arranged meeting location. The Tulsa Police Department and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations conducted the investigation.
Sean Clarke McCain, 32, of Tulsa, was sentenced to 87 months in federal prison followed by five years on supervised release for attempted receipt of child pornography. From Dec.18 to Dec. 20, 2018, McCain unknowingly made contact with an officer from Tulsa Police Department’s Cyber Crimes Task Force posing as a minor female using an online messaging app and attempted to receive photographs of the “minor” engaged in sexually explicit conduct. He then engaged the “girl” in explicit sexual conversation, eventually arranging to meet in order to engage in sexual activity. McCain was later arrested at the arranged meeting location. The Tulsa Police Department and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations conducted the investigation.
Robert Shawn Thomas Davis, 26, of Owasso, pleaded guilty on June 11, to attempted coercion and enticement of a minor. On March 25, 2019, Davis unknowingly initiated contact with an FBI Task Force Officer who was posing as a minor female. Davis engaged the “minor” in sexually explicit conversation, asking to meet her and to bring other children along to engage in sexual activity. He eventually arranged to meet the “minor.” At his plea hearing, Davis admitted that from March 25 to April 4, 2019, he used a social media app on his phone to attempt to persuade, induce and coerce and entice a what he believed was a 13-year-old girl to engage in sexual activity with him. The Court set sentencing for Sept. 24, 2019. Davis faces a minimum sentence of 10 years in prison The Tulsa Police Department and FBI conducted the investigation.
Following their federal prison sentences, all convicted sex offenders are required to comply with requirements designed to restrict their access to children and to register as sex offenders.
Assistant U.S. Attorney Christopher J. Nassar prosecuted these crimes.
U.S. Attorney’s Office to Hold Press Conference Regarding Recent Efforts to Combat Gun Crimes and Violence in Northwest Iowa.Read the Press Release
The United States Attorney’s Office in Sioux City will hold a press conference Monday, June 17, 2019, at 3:30 p.m. where Branch Chief Timothy Duax and other members of law enforcement will discuss recent efforts to confront gun crimes and violence in Northwest Iowa, including the recent charging of 26 defendants for federal gun-related crimes. The press conference will be held at the United States Attorney’s Office located at 600 Fourth St. Suite 670, Sioux City, IA.
Follow us on Twitter @USAO_NDIA.
U.S. Attorney's Office Presents "Fraud - Bingo" Game to Assist Seniors to Avoid ScamsRead the Press Release
COLUMBIA, SOUTH CAROLINA – The Justice Department today announced that it supported a World Elder Abuse Awareness Day event in Lyman, South Carolina on June 13, 2019. Assistant U.S. Attorneys David Stephens and Rob Sneed gave a presentation to seniors from the upstate using “Fraud Bingo” as a platform to provide tips on avoiding scams.
The June 13, 2019, “Lifting Up Voices” was hosted by the Appalachian Council of Governments (AGOG) and South Carolina Department on Aging (SCDOA). The Appalachian Council of Governments serves as the Area Agency on Aging (AAA) for the six-county South Carolina upstate region (Anderson, Cherokee, Greenville, Oconee, Pickens and Spartanburg counties). The AAA provides information and assistance to older adults, persons with disabilities and caregivers. It also operates the Regional Long Term Care Ombudsman Program, the Regional Family Caregivers Program, the I-CARE program, and Appalachian Assisted Rides program. The SCDOA works with a network of regional and local organizations to develop and manage services that help seniors remain independent in their homes and in their communities.
The event was a local effort to raise awareness about elder abuse and neglect in South Carolina communities. Several vendors, local businesses, and organizations contributed to the highly successful event, which included approximately 200 senior citizens. In addition to the ACOG speakers, a member of the City of Spartanburg Police Department presented on “Elder Abuse Recognition and Safety,” which included discussion on personal safety, trust, and situational awareness to avoid victimization.
AUSAs Stephens and Sneed delivered practical tips for seniors to take to prevent getting financially exploited and scammed. They operated a bingo-type game to teach seniors how to recognize and deal with scams. The game is played just like regular Bingo but with an added twist. Each time the Bingo game caller announces the square, participants read aloud the accompanying message found on their bingo card if they have a match. Each square has a message about fraud, ID theft, and scams. When there is a winner the shouts of “Fraud Bingo” ring out.
“The United States Attorney’s Office and Department of Justice (DOJ) are committed to combatting elder abuse, neglect, financial fraud, and scams that target our nation’s seniors,” said United States Attorney Sherri Lydon. She added that elder fraud schemes take a variety of forms that range from small-scale identity thefts involving impersonation of a senior to mass mailing fraud schemes that steal from thousands of elderly annually. “Our mission is to combat elder abuse and financial exploitation, encourage reporting abuse, and educate the public to make America safer for all,” added Lydon.
Find out more about the U.S. Attorney’s Office Elder Fraud program at https://www.justice.gov/usao-sc/elder-justice-initiative, or the Department of Justice’s Elder Justice Initiative at https://www.justice.gov/elderjustice.
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Two Pennsylvania physicians acquitted of drug chargesRead the Press Release
WHEELING, WEST VIRGINIA – After an eight-day trial, Dr. Krishan Kumar Aggarwal, of Moon Township, Pennsylvania, and Dr. Cherian John, of Coraopolis, Pennsylvania, were found not guilty of drug charges, United States Attorney Bill Powell announced.
“The jury returned not guilty verdicts against Dr. Aggarwal and Dr. John. Notwithstanding the verdict, we remain steadfast in our intention to prosecute matters which we believe, based upon the evidence, support prosecution. Jury trials are an adversarial process and do not provide guaranteed results. Though we disagree with the jury in this case, the jury has spoken and that is part of the process, which we have the utmost respect for. Our team worked very hard and this verdict will not deter our efforts on the opioid front,” said Powell.
A federal jury deliberated for nearly eight hours before finding Aggarwal, age 75, and John, age 66, not guilty of one count of “Conspiracy to Distribute Controlled Substances Outside the Bounds of Professional Medical Practice,” and were also indicted on separate counts of “Aiding and Abetting Health Care Fraud,” and “Aiding and Abetting the Distribution of Controlled Substances Outside the Bounds of Professional Medical Practice.” Aggarwal and John were accused of contracting with Redirections Treatment Advocates, LLC, in Weirton, West Virginia, and writing illegitimate prescriptions for suboxone, some of which were paid for by Medicaid and Medicare.
Assistant U.S. Attorneys Sarah E. Wagner and Andrew R. Cogar prosecuted the cases on behalf of the government. The Drug Enforcement Administration, the Federal Bureau of Investigation, and the Inspector General at the U.S Department of Health and Human Services investigated.
Senior U.S. District Judge Frederick P. Stamp, Jr. presided.
Two Men Indicted for Money-Laundering and Bulk Cash Smuggling of Funds from the British Virgin Islands and for Making False Statements to Federal OfficersRead the Press Release
St. Thomas, USVI – A federal Grand Jury returned an indictment against individuals including Akil Erickson, 26, of Orlando, Florida and Mikiel Robin, 21, of the British Virgin Islands, charging them with international money-laundering and bulk cash smuggling, United States Attorney Gretchen C.F. Shappert announced. The indictment also alleges that each defendant made false statements to Customs and Border Protection officers.
According to the indictment, in or about October of 2018, the defendants engaged in a conspiracy with other persons to transport United States currency from the British Virgin Islands to the United States while knowingly avoiding U.S. currency reporting requirements for reporting bulk cash exceeding $10,000. The indictment alleges that the cash was proceeds from the illegal sale of drugs and that the defendants were aware of the money’s origin. According to the indictment, each defendant falsely stated that he was not carrying in excess of $10,000 from the British Virgin Islands to the United States. The indictment also contains a forfeiture allegation of $138,000.
Robin and Akil Erickson appeared for arraignment on June 13, 2019, before Federal Magistrate Judge Ruth Miller and entered pleas of not guilty to the charges, the other two defendant, who remain unidentified at this moment, remain at large. Trial is scheduled for July 29, 2019.
Defendants face up to twenty years imprisonment and a fine of up to $500,000 for money-laundering; up to five years imprisonment for each count of bulk cash smuggling; and up to five years imprisonment for making a false statement to a federal law enforcement officer.
United States Attorney Shappert reminds the public that an indictment is merely a formal charging document and is not evidence of guilt. Every defendant is presumed innocent until and unless proven guilty.
This case is being investigated by Homeland Security Investigations (HSI). It is being prosecuted by Assistant United States Attorney Everard E. Potter.
Two Men Found Guilty of Federal Drug Trafficking and Firearms OffensesRead the Press Release
Anchorage, Alaska – U.S. Attorney Bryan Schroder announced that Dwayne Dollison Jr., 36, and Kenneth Martin Douglas, 34, both of Anchorage, were found guilty yesterday after a 7-day federal jury trial. The jury found Dollison and Douglas guilty of drug trafficking conspiracy, possession of controlled substances with intent to distribute, possession of a firearm in furtherance of a drug trafficking crime, and for being felons in possession of a firearm.
According to evidence presented at trial, the charges all revolve around a conspiracy that ended on Sept. 16, 2017, when Alaska State Troopers stopped both Dollison and Douglas in their vehicle, an SUV, as they approached the Fairbanks area. Another vehicle, a red sedan with whom they were caravanning, stopped as well. The occupants of the red sedan explained that they knew Dollison and Douglas, and they provided a rental receipt for the red sedan bearing Douglas’s name. Both Douglas and Dollison, however, initially denied any connection with the red sedan.
A search of the red sedan later uncovered distribution amounts of methamphetamine, cocaine, and heroin in the vehicle’s trunk. Some of the controlled substances were in socks in a red duffel bag that contained a firearm and clothing belonging to Dollison. Baggies of controlled substances were also found loose in the trunk next to a green duffel bag, which contained a firearm and clothing belonging to Douglas.
Both Dollison and Douglas have prior federal felony convictions and were therefore prohibited from possessing firearms.
As a result of their convictions, Dollison and Douglas face a maximum penalty of up to life in federal prison. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offense and the prior criminal history, if any, of the defendants.
The Alaska State Troopers (AST), the Federal Bureau of Investigation (FBI), the Bureau of Alcohol, Tobacco, Firearms, & Explosives (ATF), the Drug Enforcement Administration (DEA), and the Alaska Department of Public Safety Scientific Crime Detection Laboratory conducted the investigation leading to the successful prosecution of this case. This case is being prosecuted by Assistant U.S. Attorneys Kimberly Sayers-Fay and Allison O’Leary.
Two Drug Traffickers Sentenced for Distribution Resulting in DeathRead the Press Release
BOISE – Vaudencia Ceballos Hamilton, 55, of Hesperia, California, and Matthew Lee Sedillo, 30, of Eagle, Idaho, were sentenced to federal prison for conspiracy to distribute methamphetamine and fentanyl resulting in death, U.S. Attorney Bart M. Davis announced today. Chief U.S. District Judge Nye sentenced Hamilton to 240 months in prison and ordered that she pay a $100,000 fine. On the same day, Senior U.S. District Judge Edward J. Lodge sentenced Sedillo to 121 months in prison. Both defendants, upon completion of their prison time, were ordered to serve an additional three years of supervised release.
According to court records, on August 14, 2017, Dominico Stewart of Nampa, Idaho, was found dead in an alleyway. A toxicology report showed that Stewart had a lethal dose of methamphetamine and fentanyl in his system. The coroner determined that Stewart died of a methamphetamine overdose.
Investigators learned that, just before his death, Stewart had met with Ryan Curtis, a methamphetamine dealer living in Nampa. Curtis had begun distributing what he called “China White”, a common street name for either pure heroin or a mixture of heroin and fentanyl. Curtis gave Stewart a sample of “China White” and asked that Stewart try the substance while Curtis was present so that Stewart understood how potent the drug was.
Shortly after Stewart ingested the substance, he collapsed. Instead of calling emergency services or seeking help for Stewart, Curtis tried to revive Stewart on his own through several different methods, including injecting Stewart with methamphetamine. Ultimately, Stewart died. Curtis did not notify law enforcement of the death, but attempted to conceal his role in Stewart’s death by dumping Stewart’s body in an alleyway in Nampa.
The investigation into Stewart’s death lead them not only to Ryan Curtis, but ultimately to a drug trafficking organization that was distributing methamphetamine and fentanyl in the Treasure Valley. Matthew Sedillo, Herman Sedillo, and Vaudencia Hamilton were all part of a trafficking organization that distributed the drugs that caused Dominico Stewart’s death. Matthew Sedillo worked with his father, Herman Sedillo to transport controlled substances from their source of supply in California, Vaudencia Hamilton. Once in Idaho, they distributed the drugs to others, including Ryan Curtis. As a result of the investigation, officers were able to seize 852.6 grams of methamphetamine and 957.8 grams of fentanyl.
These cases were investigated by the Drug Enforcement Administration and the Nampa Police Department.
These indictments are the result of a joint investigation by the Organized Crime and Drug Enforcement Task Force (OCDETF). The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies. The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply. Program participants include the Federal Bureau of Investigation; Drug Enforcement Administration; Bureau of Alcohol, Tobacco, Firearms and Explosives; U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; Internal Revenue Service-Criminal Investigation; and the U.S. Marshals Service.
These cases were prosecuted by the Special Assistant U.S. Attorney hired by the Ada County Prosecuting Attorney’s Office and the Idaho High Intensity Drug Trafficking Area Board. The Idaho High Intensity Drug Trafficking Board is a collaboration of local law enforcement drug task forces and prosecuting agencies dedicated to addressing regional drug trafficking organizations that operate in Ada and Canyon County.
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Two Men from McKinley County, N.m. Charged with Robbery and Firearm Possession in Indian CountryRead the Press Release
ALBUQUERQUE – Aurelius Jamal Eddie, 18, and Julian C. Silversmith, 42, both from the area of Gallup, N.M. appeared in federal court on June 10, 2019, on charges of robbery for interfering with commerce by threats or violence and discharging a firearm during a crime of violence in Indian Country.
According to a criminal complaint and statements in court, Eddie and Silversmith committed these offenses with other people in Vanderwagen, N.M. on April 18, 2019. Eddie allegedly went inside a store with two other people. At least two of them had pistols. They pointed the guns and yelled at other people inside the store. Eddie shot at the ceiling. Then they left the store with stolen alcohol. Silversmith provided Eddie with the gun used in the robbery. Eddie and Silversmith are currently in custody pending trial. They face up to 20 years in prison if convicted of the robbery offense and from 10 years to life in prison if convicted of the firearm offense. Criminal complaints are only allegations and defendants are presumed innocent until proven guilty.
The FBI investigated this case. Assistant U.S. Attorney Allison Jaros is prosecuting the case.
Suspected High-Level Guatemalan Drug Trafficker Arraigned in San Diego on Charges He Moved Large Quantities of Cocaine on the High SeasRead the Press Release
Assistant U. S. Attorney Sherri Walker Hobson (619) 961-0287
NEWS RELEASE SUMMARY – June 14, 2019
SAN DIEGO – Willian Estuardo Lemus Lara, a suspected high-level cartel boss from Central America, was arraigned in federal court today on maritime cocaine trafficking charges.
According to the documents filed in court, Lemus was the manager of the transportation and distribution cell responsible for facilitating multi-ton quantity cocaine loads via go-fast vessels on the high seas originating from Colombia and Ecuador to Costa Rica and Guatemala. The United States alleged that he sold his cocaine loads to Mexican drug trafficking organizations for transportation to the United States.
The United States further alleged that Lemus was involved in a two-year conspiracy and that he directed the movement of large quantities of cocaine in go-fast vessels across international waters, including facilitating refueling vessels on the high seas during their journey north.
Lemus was indicted by a federal grand jury on January 18, 2018. He was charged with conspiracy to possess with intent to distribute cocaine on board a vessel, and international conspiracy to distribute cocaine. U.S. Magistrate Judge Andy Schopler ordered the defendant detained without bond. Lemus’ next hearing is scheduled for July 19, 2019, before U.S. District Judge Dana M. Sabraw.
“Federal law enforcement officials worked together in three countries to successfully disrupt a dangerous drug trafficking ring that sought to smuggle thousands of kilograms of cocaine into the United States,” said U.S. Attorney Robert Brewer. “Through effective partnerships and outstanding investigation, we intercepted significant loads of this highly addictive stimulant, stripped traffickers of drug profits, and helped to safeguard our communities.”
“I commend the government of Guatemala and all of our foreign and domestic law enforcement partners for their hard work. Their support was instrumental in our joint effort to dismantle this international criminal organization's ability to bring dangerous drugs into our communities and ensure the perpetrators of such attempts are brought to justice,” said David Shaw, special agent in charge for HSI San Diego. “These type of aggressive and coordinated law enforcement efforts are critical to removing the threat posed by criminals flooding American communities with dangerous narcotics, and we will continue to work with our U.S. and international law enforcement partners to bring transnational criminal organizations to justice.”
“DEA protects our communities by hunting down the head of the snake and bringing them to a U.S. courtroom to face U.S. justice,” said DEA Special Agent in Charge Karen Flowers. “The apprehension of a suspected cartel leader highlights what we do best: Leverage all tools across U.S. law enforcement, our foreign counterparts, and work as one to take out anyone, anywhere who profits from the human misery of addiction.”
“This significant case demonstrates what we can accomplish together with intelligence, diligence and commitment to excellence,” said Pete Flores, director of field operations for San Diego. “I commend the CBP task force officer and our partners at HSI, DEA, and the U.S. Attorney’s Office who collaborated to identify, investigate, to bring this man to justice and disrupt this transnational criminal organization.”
During the investigation, federal agents seized approximately 5,900 kilograms, or 13,000 pounds, of cocaine.
This case is the result of ongoing efforts by the Organized Crime Drug Enforcement Task Force (OCDETF), a partnership that brings together the combined expertise of federal, state and local law enforcement. The principal mission of the OCDETF program is to identify, disrupt, dismantle and prosecute high-level members of drug trafficking, weapons trafficking, and money laundering organizations and enterprises.
DEFENDANT Case Number 18CR0390DMS
Willian Estraduo Lemus-Lara Age: 49 Guatemala
SUMMARY OF CHARGES
Count 1 - Conspiracy to Possess with Intent to Distribute Cocaine on Board a Vessel
Maximum penalty: Life in prison, 10-year minimum mandatory; $1 million fine
Count 2 - International Conspiracy to Distribute Controlled Substances
Maximum penalty: Life in prison, 10-year minimum mandatory; $1million fine
INVESTIGATING AGENCIES
Homeland Security Investigations (HSI)
Drug Enforcement Administration (DEA)
Customs and Border Protection (CBP)
U.S. Coast Guard
HSI Joint Task Force Investigations (JTF-I)
HSI Attaché Guatemala City, Guatemala
HSI Attaché Mexico City Mexico
Joint Interagency Task Force-South (JIATF-S)
*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Ship Operator and Two Cargo Ship Engineers Face Federal Charges in Water Pollution Case Involving Dumping of Oily WasteRead the Press Release
LOS ANGELES – A Greek cargo ship operator and two chief engineers of one of its ships have been named in a five-count federal indictment charging them with failing to record the illegal dumping of oily waste into international waters and then obstructing justice by ordering the ship’s crew to lie about it.
A federal grand jury returned the indictment on Thursday against:
- Capital Ship Management Corporation, a ship management company based in Piraeus, Greece;
- Ioan Luca, 54, a Romanian national and from October 2018 to January 2019 the chief engineer of the M/V CMA CGM Amazon, a Liberian-flagged container ship that is nearly 1,000 feet long and is managed by Capital Ship Management Corp.; and
- Ionel Surla, 60, a Romanian national and the chief engineer of the Amazon from May 2018 to October 2018, and who is believed to be in Romania.
The defendants are charged with multiple felonies, including conspiracy to fail to maintain an accurate oil record book and to defraud the United States, failure to maintain an accurate oil record book, falsification of records in a matter of federal administration, witness tampering, and obstruction of justice.
Pursuant to international treaties and U.S. law, all large ships, such as the Amazon, are required to use pollution-control technology, including an oily water separator, to remove oil from bilge water that is discharged into the ocean.
The indictment alleges that Luca and, previously, Surla ordered crew members to use a portable pump and flexible hoses in the ship’s engine room to transfer oil-contaminated bilge water to a tank designed to hold clean water, then dispose of the water directly overboard into international waters, avoiding use of the oily water separator.
Luca and Surla then failed to record such discharges in the ship’s oil record book, a document required by federal law. The Amazon’s ports of call include various ports in Asia, Egypt, and Canada, as well as the Port of Los Angeles, according to the indictment. While at the Port of Los Angeles on January 11, the ship presented the false oil record book to U.S. Coast Guard inspectors during an inspection, the indictment alleges.
Capital Ship Management and Luca also have been charged with obstruction of justice and witness tampering for allegedly instructing crew members to lie to the Coast Guard about events that occurred on the ship while at sea. In conducting the investigation, Coast Guard personnel relied on the statements of the ship’s crew as well as documents, the indictment states.
If convicted of all charges, Luca faces a statutory maximum sentence of 61 years in federal prison while Surla faces a statutory maximum sentence of 11 years in federal prison. Capital Ship Management and Luca, who was arrested last month and is free on bond, were previously named in a criminal complaint.
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.
In a related case, Marian Gavriluta-Strat, 37, a Romanian national and the Amazon’s second engineer, has agreed to plead guilty to an information charging him with failure and causing the failure to maintain an accurate oil record book. Gavriluta-Strat is scheduled to enter a guilty plea to the charges on June 19. He faces a statutory maximum sentence of six years in federal prison.
This case was investigated by the United States Coast Guard Investigative Service.
This matter is being prosecuted by Assistant United States Attorneys Heather C. Gorman, Erik M. Silber, and Paul G. Stern of the Environmental and Community Safety Crimes Section.
Second New York Broker-Dealer Pleads Guilty to Rigging Bids for Financial Instruments in Violation of Antitrust LawRead the Press Release
Industrial and Commercial Bank of China Financial Services LLC (ICBCFS) pleaded guilty to an antitrust charge and was sentenced to pay a criminal fine in excess of $3 million for its involvement in a bid-rigging conspiracy involving certain financial instruments, the Department of Justice announced today.
ICBCFS admitted, as part of a guilty plea, that from May 2012 until at least August 2014, it conspired with other institutions and individuals to submit rigged bids to borrow pre-release American Depository Receipts (ADRs). ICBCFS’s plea is the second in the ongoing criminal antitrust investigation; Banca IMI Securities Corp. previously pleaded guilty for its role in the conspiracy and was sentenced to pay a fine in excess of $2 million on May 10, 2019.
Worldwide, thousands of publicly traded companies list their shares of common stock only on foreign stock exchanges. Most U.S. investors are unable to purchase or sell such foreign shares. The U.S. Securities and Exchange Commission, however, permits four U.S. depository banks to create ADRs, which represent foreign ordinary shares and can be traded in the United States. Through the purchase and sale of ADRs, U.S. investors are able to gain exposure to — including the ability to receive dividends from — companies whose common stock is listed only on foreign stock exchanges.
ICBCFS pleaded guilty to conspiring to borrow pre-release ADRs from U.S. depository banks at artificially suppressed rates. During the conspiracy, a U.S. depository bank began using an auction-style process and invited ICBCFS and other broker-dealers to submit competitive bids for rates to borrow ADRs. In response, ICBCFS and its co-conspirators intensified their coordination in an effort to artificially increase their profits under the auction-style process. On at least 24 occasions, ICBCFS reached an agreement with one or more co-conspirators as to the bids they would submit to U.S. depository banks. On many occasions, the conspirators agreed that they would all submit the same bid.
“In today’s proceeding, the Department of Justice and its law enforcement partners held to account another broker-dealer for its role in suppressing competition and rigging bids in the financial services industry,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division. “The competitive integrity of financial markets is essential to their efficient operation, and the Antitrust Division will continue to aggressively prosecute collusion that corrupts our financial markets.”
“As evidenced by this latest guilty plea, the FBI’s investigation into big ridding for ADRs is broad and deep,” said Assistant Director Robert Johnson of the FBI’s Criminal Investigative Division. “Not only are we bringing the conspirators to justice, we are sending a message to the entire financial industry: you are not above the law. The FBI can and will investigate bid rigging and all fraudulent schemes. You will be caught.”
“This guilty plea is an example of the FBI’s commitment to investigating companies when they operate outside the law and conspire to cheat and dominate the marketplace,” said FBI Washington Field Office, Acting Assistant Director in Charge, John P. Selleck. “I would like to thank the FBI agents and analysts who have worked on this complex investigation and are committed to holding those companies accountable who disregard the rule of law for their own financial gain.”
The Securities and Exchange Commission also separately announced today that ICBCFS has agreed to settle charges that it violated federal securities laws by improperly handling pre-release ADRs.
The Washington Criminal II Section of the Antitrust Division and the FBI’s International Corruption Squad in Washington, D.C. are conducting the investigation into bid rigging in the market for pre-release ADRs. Anyone with information in connection with this investigation is urged to call the Antitrust Division’s Washington Criminal II Section at 202-598-4000 or visit www.justice.gov/atr/contact/newcase.html.
Schuylkill County Man Guilty of Heroin Trafficking ConspiracyRead the Press Release
SCRANTON—The United States Attorney’s Office for the Middle District of Pennsylvania announced that Anthony Navarro-Velez, age 33, of Shenandoah, Pennsylvania, pleaded guilty on June 6, 2019, before Senior U.S. District Court Judge James M. Munley, to conspiracy to distribute and possess with intent to distribute more than a kilogram of heroin.
According to United States Attorney David J. Freed, the defendant admitted to participating in the conspiracy during 2014 and 2015. Navarro-Velez admitted that he and others in the conspiracy distributed between one and three kilograms of heroin, which is approximately equivalent to between 40,000 and 120,000 retail bags of heroin.
Judge Munley ordered a pre-sentence investigation to be completed, and scheduled sentencing for September 9, 2019.
The case was investigated by the Federal Bureau of Investigation, the Pennsylvania State Police, and the Shenandoah Police. Assistant U.S. Attorney Francis P. Sempa is prosecuting the case.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
This case was also brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.
The maximum penalty under federal law for this offenses is life imprisonment, a term of supervised release following imprisonment, and a fine. There is also a mandatory minimum sentence of 10 years’ imprisonment. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Rosebud Man Indicted for Failure to Register as a Sex OffenderRead the Press Release
United States Attorney Ron Parsons announced that a Rosebud, South Dakota, man has been indicted by a federal grand jury for Failure to Register as a Sex Offender.
Jason Kimmel, Sr., age 37, was indicted on June 11, 2019. He appeared before U.S. Magistrate Judge Mark A. Moreno on June 13, 2019, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in federal prison and/or a $250,000 fine, 5 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
Kimmel was convicted of Sexual Abuse of a Minor in 2005. As a result of this conviction, he is required to register as a sex offender for his natural lifetime. It is alleged that between March 25, 2019, and April 24, 2019, Kimmel, a person required to register under the Sex Offender Registration and Notification Act, and a sex offender by reason of conviction under Federal Law, failed to properly register as a sex offender.
The charge is merely an accusation and Kimmel is presumed innocent until and unless proven guilty.
The investigation is being conducted by the U.S. Marshals Service. Assistant U.S. Attorney Michael J. Elmore is prosecuting the case.
Kimmel was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
Rogers Man Sentenced to 1 Year in Federal Prison for Social Security FraudRead the Press Release
Fayetteville, Arkansas - Duane (DAK) Kees, United States Attorney for the Western District of Arkansas, announced that Mike Bailey, age 49, of Rogers, Arkansas, was sentenced this week to 12 months in federal prison followed by three years of supervised release, and restitution in the amount of $123,181.00 for one count of Theft of Government Funds. The Honorable Timothy L. Brooks presided over the sentencing hearing in the United States District Court in Fayetteville.
According to court records, Bailey applied for Social Security Disability Benefits in 2003 citing pain and mental health issues, but was denied. In 2005, Bailey was approved for Social Security Benefits. Pursuant to the application, Bailey agreed to notify the Social Security Administration of any changes in his ability to work and his employment status. In 2017, Bailey completed a “Continuing Disability Review Report,” and claimed that he had not worked since his last medical decision. Subsequently, investigators discovered that Bailey was self-employed as a fishing guide for the past eight (8) years, and had lead 3-4 trips per week during that period. In April 2018, investigators observed Bailey’s work as a fishing guide. Investigators were able to observe Bailey completing tasks that he indicated that he was unable to complete. Bailey exhibited mental acuity inconsistent with his earlier professed mental limitations. Bailey admitted that he did receive Social Security Disability Benefits that he knew he was not entitled. Bailey’s scheme resulted in an aggregate value of $123,181.00, which he was not entitled to receive.
Bailey was indicted by a federal grand jury in July 2018, and entered a guilty plea in January 2019.
This case was investigated by Detective Charles Briscoe of the Office of the Inspector General, Social Security Administration, working jointly with the Arkansas Attorney General’s Office (AG), United States Secret Service, and Arkansas Game and Fish Commission. Assistant United States Attorney Amy Driver prosecuted the case for the United States.
Prosecutors from the United States, Colombia and Mexico Strengthen Their Commitment to Dismantling Transnational Criminal OrganizationsRead the Press Release
On June 12 to 14, in Cartagena, Colombia, prosecutors from Colombia, Mexico, and the United States came together for the second Transnational Criminal Organizations (TCO) Working Group. The mission of the Working Group is to engage in specialized training and to develop joint strategies and best practices to dismantle the transnational criminal organizations that threaten the three nations.
During the Working Group, experienced prosecutors from the three nations benefited from trainings on international judicial cooperation and money laundering, and began developing a road map for the development or dissemination of best practices and effective strategies to dismantle these dangerous enterprises. This effort is all the more critical given the increasing interconnectedness between Mexican cartels and Colombian drug trafficking organizations, which collaborate to improve their profits and ability to traffic narcotics, humans, weapons and other contraband into the United States, threatening its national security.
The TCO Working Group is a direct outgrowth of Presidential Executive Order 13773 – Enforcing Federal Law with Respect to Transnational Criminal Organizations and Preventing International Trafficking – which recognized the threat that transnational criminal organizations, including transnational drug cartels, pose to the national security of the United States. In the Executive Order, President Trump prioritized the need to increase cooperation and information sharing with foreign counterparts, and to enhance their operational capabilities via increased security sector assistance, all with the goal of dismantling TCO. Since the 2017 Executive Order was issued, the President has continually reiterated the need to immediately attack the ability of these organizations to traffic narcotics and other criminality into the United States.
The U.S. Department of Justice’s Office of Overseas Prosecutorial Development, Assistance and Training (OPDAT), which is housed under the Department’s Criminal Division, seized on the momentum from the Dec. 6 to 7, 2017 “Trilateral Summit Against Transnational Organized Crime,” to spearhead the TCO Working Group. The Attorneys General from the United States, Mexico and Colombia converged at the Trilateral Summit to strengthen their commitment to international judicial cooperation and to reinforce joint strategies to dismantle transnational organized crime, such as narcotics trafficking, money laundering, and public corruption. Via a Joint Declaration, the three Attorneys General called on their respective institutions to increase the exchange of best practices to effectively dismantle TCO and to develop joint capacity building and training programs for those charged with investigating and prosecuting TCO. With this clear mandate, OPDAT Colombia and OPDAT Mexico sponsored the first TCO Working Group in August 2018 in Mexico City, Mexico.
Participating in the TCO Working Group meeting was U.S. Attorney Maria Chapa Lopez for the Middle District of Florida; representatives of the Fiscalía General de la Nación (FGN) of Colombia including Claudia Carrasquilla, head of the National Organized Crime Unit and Ricardo Carriazo, head of the National Drug Trafficking Unit of FGN; representatives of the Fiscalía General de la República (FGR) of Mexico, OPDAT Resident Legal Advisors (RLAs) in Colombia and México and Assistant U.S. Attorneys from the federal districts of Arizona, Southern District of California, Middle District of Florida, Southern District of Florida, Northern District of Georgia, District of New Jersey, District of New Mexico, Eastern District of Texas, Southern District of Texas, Western District of Texas and District of Utah; trial attorneys from the Criminal Division’s Money Laundering and Asset Recovery Section and representatives from the Criminal Division’s International Criminal Investigative Training and Assistance Program (ICITAP); the U.S. Drug Enforcement Administration (DEA); U.S. Customs and Border Protection; U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) and the Colombian National Police.
“Global cooperation is the key to mitigating threats to our national security and thwarting borderless crimes,” said U.S. Attorney Maria Chapa Lopez for the Middle District of Florida. “The OPDAT Program continues to provide us, and our international partners, with the vital tools, information, and resolve necessary to defeat criminals, wherever they operate.”
"We held the trilateral meeting between the U.S., Colombian and Mexican prosecutors, where we've discussed issues of absolute importance for the dismantling of transnational criminal organizations that affect the national security of our countries,” said Ricardo Carriazo, Director of the Special Unit against Drug Trafficking for the Colombian Attorney General’s Office. “The results in this exchange of experiences and good practices will be seen soon in the development of international judicial operations. "
OPDAT spearheads and organizes this critical event in coordination with the U.S. Department of State’s Bureau of International Narcotics and Law Enforcement Affairs (INL).
For photos of this event, please see here.
Prosecutors from the United States, Colombia and Mexico Strengthen Their Commitment to Dismantling Transnational Criminal OrganizationsRead the Press Release
WASHINGTON – On June 12 to 14, in Cartagena, Colombia, prosecutors from Colombia, Mexico, and the United States came together for the second Transnational Criminal Organizations (TCO) Working Group. The mission of the Working Group is to engage in specialized training and to develop joint strategies and best practices to dismantle the transnational criminal organizations that threaten the three nations.
During the Working Group, experienced prosecutors from the three nations benefited from trainings on international judicial cooperation and money laundering, and began developing a road map for the development or dissemination of best practices and effective strategies to dismantle these dangerous enterprises. This effort is all the more critical given the increasing interconnectedness between Mexican cartels and Colombian drug trafficking organizations, which collaborate to improve their profits and ability to traffic narcotics, humans, weapons and other contraband into the United States, threatening its national security.
The TCO Working Group is a direct outgrowth of Presidential Executive Order 13773 – Enforcing Federal Law with Respect to Transnational Criminal Organizations and Preventing International Trafficking – which recognized the threat that transnational criminal organizations, including transnational drug cartels, pose to the national security of the United States. In the Executive Order, President Trump prioritized the need to increase cooperation and information sharing with foreign counterparts, and to enhance their operational capabilities via increased security sector assistance, all with the goal of dismantling TCO. Since the 2017 Executive Order was issued, the President has continually reiterated the need to immediately attack the ability of these organizations to traffic narcotics and other criminality into the United States.
The U.S. Department of Justice’s Office of Overseas Prosecutorial Development, Assistance and Training (OPDAT), which is housed under the Department’s Criminal Division, seized on the momentum from the Dec. 6 to 7, 2017 “Trilateral Summit Against Transnational Organized Crime,” to spearhead the TCO Working Group. The Attorneys General from the United States, Mexico and Colombia converged at the Trilateral Summit to strengthen their commitment to international judicial cooperation and to reinforce joint strategies to dismantle transnational organized crime, such as narcotics trafficking, money laundering, and public corruption. Via a Joint Declaration, the three Attorneys General called on their respective institutions to increase the exchange of best practices to effectively dismantle TCO and to develop joint capacity building and training programs for those charged with investigating and prosecuting TCO. With this clear mandate, OPDAT Colombia and OPDAT Mexico sponsored the first TCO Working Group in August 2018 in Mexico City, Mexico.
Participating in the TCO Working Group meeting was U.S. Attorney Maria Chapa Lopez for the Middle District of Florida; representatives of the Fiscalía General de la Nación (FGN) of Colombia including Claudia Carrasquilla, head of the National Organized Crime Unit and Ricardo Carriazo, head of the National Drug Trafficking Unit of FGN; representatives of the Fiscalía General de la República (FGR) of Mexico, OPDAT Resident Legal Advisors (RLAs) in Colombia and México and Assistant U.S. Attorneys from the federal districts of Arizona, Southern District of California, Middle District of Florida, Southern District of Florida, Northern District of Georgia, District of New Jersey, District of New Mexico, Eastern District of Texas, Southern District of Texas, Western District of Texas and District of Utah; trial attorneys from the Criminal Division’s Money Laundering and Asset Recovery Section and representatives from the Criminal Division’s International Criminal Investigative Training and Assistance Program (ICITAP); the U.S. Drug Enforcement Administration (DEA); U.S. Customs and Border Protection; U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) and the Colombian National Police.
“Global cooperation is the key to mitigating threats to our national security and thwarting borderless crimes,” said U.S. Attorney Maria Chapa Lopez for the Middle District of Florida. “The OPDAT Program continues to provide us, and our international partners, with the vital tools, information, and resolve necessary to defeat criminals, wherever they operate.”
"We held the trilateral meeting between the U.S., Colombian and Mexican prosecutors, where we've discussed issues of absolute importance for the dismantling of transnational criminal organizations that affect the national security of our countries,” said Ricardo Carriazo, Director of the Special Unit against Drug Trafficking for the Colombian Attorney General’s Office. “The results in this exchange of experiences and good practices will be seen soon in the development of international judicial operations. "
OPDAT spearheads and organizes this critical event in coordination with the U.S. Department of State’s Bureau of International Narcotics and Law Enforcement Affairs (INL).
Ponchatoula Woman Pleads Guilty to Obstructing JusticeRead the Press Release
NEW ORLEANS – U.S. Attorney Peter G. Strasser announced that ANGEL PERILLOUX, age 38, of Ponchatoula, pleaded guilty to a one-count bill of information charging her with obstruction of justice.
According to the court documents, PERILLOUX obstructed a federal grand jury investigation by soliciting individuals to remove evidence from an impounded vehicle. PERILLOUX discussed several unsuccessful attempts to break into the vehicle on recorded jail calls. Ultimately, at PERILLOUX’s direction, an employee of Cooper’s Salvage Yard and Wrecker Service removed a firearm and drug money from a vehicle and provided them to PERILLOUX.
PERILLOUX faces a maximum term of imprisonment of ten years, a fine of $250,000, three years supervised release after imprisonment, and a $100 special assessment. U.S. District Judge Carl J. Barbier set sentencing for October 3, 2019.
The Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Tangipahoa Parish Sheriff’s Office investigated this matter. The case was prosecuted by Assistant United States Attorney Maria M. Carboni.
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Pickens County Sheriff to Plead Guilty to Wire Fraud and Tax ChargesRead the Press Release
Pickens County Sheriff to Plead Guilty to Wire Fraud and Tax Charges
BIRMINGHAM – Today a federal indictment was unsealed against the longstanding sheriff of Pickens County for wire fraud and filing false tax returns, announced U.S. Attorney Jay E. Town, FBI Special Agent in Charge Johnnie Sharp, Jr. and IRS-Criminal Investigation Special Agent in Charge Thomas J. Holloman. Also today, a plea agreement was filed in federal district court. According to that agreement, the defendant has agreed to plead guilty to one count of wire fraud and one count of filing a false tax return.
The nine-count indictment filed in U.S. District Court charges Pickens County Sheriff DAVID EUGENE ABSTON, of Gordo, with seven counts of wire fraud and two counts of filing a false tax return.
“A sitting county sheriff is alleged to have defrauded a food bank and a church for his personal gain at the expense of the underprivileged that the food bank serves,” Town said. “Our office will continue to aggressively pursue and prosecute public officials who violate the public trust for their own personal gain.”
“No matter what your career or position is within our communities, all U.S. citizens are obligated to comply with the tax laws,” said Holloman. “Honest and law abiding citizens are fed up with the likes of those who use deceit and fraud to line their pockets as well as skirt their tax obligations.”
According to the indictment, as sheriff of Pickens County, Abston was responsible for the care and custody of prisoners housed in the Pickens County Jail. That responsibility included feeding inmates housed in the jail. In exchange, Abston was entitled to receive a specified food allowance per prisoner per day from the state of Alabama and other governmental entities. Between 2014 and 2018, Abston received more than $400,000 in food allowance money from the state of Alabama and other governmental entities. During that same period, Abston—like many sheriffs in Alabama—had a practice of keeping for himself any food allowance money that he did not spend to feed inmates.
During that same period Abston engaged in a scheme to defraud the West Alabama Food Bank, as well the Highland Baptist Church of Gordo, Alabama—where Abston was a member—in order to reduce his jail food expenses and increase the amount of food allowance money he could keep.
The West Alabama Food Bank (WAFB) is a non-profit based in Tuscaloosa, Alabama, with the stated mission of helping to alleviate hunger and food insecurity in nine West Alabama counties. WAFB collects donations of food and distributes that food to partner agencies such as churches, soup kitchens, and food pantries. To become a partner agency with WAFB, a church must submit an application stating, among other things, that the church will distribute food in compliance with WAFB policy. The criteria for a church’s partnering with WAFB include a requirement that the church use the food it receives solely to serve the ill, needy, or infants. In turn, WAFB provides food to its partner agencies for a nominal fee to help cover the costs of food maintenance and storage.
According to the indictment, in 2014 Abston convinced Highland Baptist Church in Gordo, Alabama, to permit him to open a bank account to be used for a church food pantry with WAFB. Abston opened that bank account, in the name of the Highland Baptist Church Food Pantry. Abston was the sole signatory on the account.
Around the same time, Abston applied, on behalf of the Highland Baptist Church Food Pantry, to become a partner agency of WAFB. The application to WAFB claimed that the “general program” of the church food pantry would be to help “feed poor” and “children from disadvantage[d] and poor neighborhoods.” The application claimed that the food pantry would use unemployment, sickness, and poverty as eligibility guidelines for food. The application said nothing about the food pantry’s providing any food to inmates in the Pickens County Jail.
Between 2014 and 2018, Abston wrote more than $80,000 in checks from his own bank account to the church food pantry bank account, and wrote more than $80,000 in checks from the food pantry bank account to WAFB in exchange for food.
According to the indictment, Abston used a significant portion of that food to feed inmates in the Pickens County Jail.
The indictment also alleges that Abston filed false tax returns for the 2015 and 2016 tax years, because he failed to report all of his income for those years.
Each count of wire fraud carries a maximum penalty of 20 years and a fine of up to $250,000. The maximum penalty for filing a false tax return is three years in prison and a $100,000 fine for each count.
The Federal Bureau of Investigation and Internal Revenue Service investigated the case, which Assistant U.S. Attorney John B. Ward is prosecuting.
An indictment contains only charges and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
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Petal Woman Pleads Guilty to Conspiracy to Commit Bank FraudRead the Press Release
Hattiesburg, Miss. – Martina Tashay Wade, 34, of Petal, pled guilty today before Senior U.S. District Judge Keith Starrett to a Criminal Information charging her with conspiracy to commit bank fraud, announced U.S. Attorney Mike Hurst and Inspector in Charge Chris Cave with the U.S. Postal Service Office of Inspector General, Southern Area Field Office.
In November 2015, Wade conspired to commit bank fraud and participated in the execution of a scheme to obtain money from Citizens Bank by presenting an altered $5,000 check, which had her name added for cashing, and on which she was paid due to her false representation.
Wade will be sentenced by Judge Starrett on October 2, 2019, at 9:45 a.m, in Hattiesburg.
The case was investigated by the U.S. Postal Inspection Service and prosecuted by Assistant U.S. Attorney Andrea Jones.
Pennsylvania Woman Charged with Fraud for Perpetrating “Grandparents Scheme”Read the Press Release
PHILADELPHIA – United States Attorney William M. McSwain announced today that Yahaira Diaz, 33, of Pottsville, Pennsylvania, was charged by Information with aggravated identity theft, mail fraud, and access device fraud. The charges against the defendant stem from her participation in what has been popularly dubbed the “Grandparents Scheme”, a type of elder financial abuse. The charges come one day in advance of “World Elder Abuse Awareness Day” on June 15, 2019.
As alleged in the Information, the scheme operated as follows: an individual called an elderly victim posing as the grandchild of the victim, or posing as an attorney representing the grandchild. The caller claimed that the grandchild was in a vehicular accident and was arrested for driving under the influence (or some type of legal trouble). The caller then said that the grandchild needed money for bail or legal representation, and persuaded the victim to send thousands of dollars in cash via overnight delivery service to an address where the schemers retrieved the package. The schemers then continued to call the victim and demand more money until the victim realized that he or she had been defrauded and stopped sending money.
In those telephone calls, to further convince the grandparents to send cash, the co-schemers described the grandchild’s situation as increasingly serious: claiming that the grandchild had been arrested for driving under the influence; that a pregnant woman was involved in the accident; that the pregnant woman and her unborn child were injured or killed; that the grandchild would not be released from prison without additional funds; and that legal and other fees were mounting.
Diaz allegedly played a leadership role in this scheme, which she and her co-schemers perpetrated in Allentown and Bethlehem, Pennsylvania. For example, she identified and arranged for access to residential locations where her co-schemers instructed victims to send the fraud proceeds. Diaz recruited and controlled additional participants in the scheme who allowed her to use their residences for the receipt of proceeds, and who helped retrieve the packages and shared the proceeds with other co-schemers.
Diaz engaged in numerous incidents of the Grandparents Scheme as well as credit card fraud, which is also charged in the Information. In the Grandparents Scheme, Diaz and her co-schemers defrauded at least 10 elderly victims of at least $158,800 and attempted to defraud those victims of at least an additional $69,000. If convicted, the defendant faces a maximum possible sentence of 72 years in prison, including a mandatory minimum term of two years in prison.
“Crimes against the elderly target some of the most vulnerable people in our society, and schemes like the ‘Grandparent Scheme’ are particularly heinous because they prey on a senior’s love for their family,” said U.S. Attorney McSwain. “The Department of Justice is committed to protecting our seniors from fraud, and my Office will continue to prioritize prosecuting criminals who prey on our elderly residents.”
“Trying to scam strangers out of money is criminal,” said Michael T. Harpster, Special Agent in Charge of the FBI's Philadelphia Division. “Specifically targeting elderly victims because you figure they're easy marks is cruel. The FBI will never stop working to shut down elder fraud schemes like this to protect older folks and help them hang on to their hard-earned money.”
“Crimes like these against our elderly citizens are taken very seriously by law enforcement. The Bethlehem Police Department, working with its Federal partners, will investigate, arrest and prosecute individuals involved in criminal scams like these ‘Grandparent Scams,” said Mark DiLuzio, Chief of Police, Bethlehem Police Department. “As Chief, I would like to personally thank U.S. Attorney McSwain and his Office, the FBI, U.S. Postal inspectors, the Northampton County District Attorney’s Office and Bethlehem Police Detectives who all worked collectively and brought this person and her partners to justice. On behalf of all elderly citizens in the City of Bethlehem, thank you!”
The case was investigated by the Federal Bureau of Investigation, the United States Postal Service, the Bethlehem Police Department, and the Northampton County District Attorney’s Office, and is being prosecuted by Deputy United States Attorney Louis D. Lappen.
An indictment, information, or criminal complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
The Department of Justice is committed to combating elder fraud. The Department’s historic 2018 and 2019 Elder Fraud Sweeps collectively brought criminal and civil actions against more than 500 defendants responsible for defrauding more than $1.5 billion from at least 3 million victims.
The Department of Justice also provides a variety of resources relating to elder fraud victimization through its Office of Victims of Crime (OVC), which has announced a new competitive solicitation addressing enhanced multidisciplinary teams for older victims of abuse and financial exploitation (up to $375,000 each) and funding for a National Multidisciplinary Team Technical Assistance Center (for up to $3 million), which will help facilitate the expansion of elder abuse case review across the nation. The deadline is July 7, 2019.
More information about the Department’s efforts to help American seniors is available at its Elder Justice Initiative webpage. For more information about the Consumer Protection Branch and its enforcement efforts, visit its website. Elder fraud complaints may be filed with the FTC at www.ftccomplaintassistant.gov or at 877-FTC-HELP.
PSN Amarillo Taskforce Arrests 4 Alleged Cocaine DealersRead the Press Release
A Project Safe Neighborhoods - Amarillo Taskforce arrested four defendants while executing search warrants at two North Heights area crack houses, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.
All defendants have been charged via criminal complaint with distribution and possession with intent to distribute cocaine or cocaine base, and all remain in federal custody pending trial.
Among those arrested during the PSN - Amarillo raid was Earnest Tywane Drone, 39, a well-known dealer who allegedly sold cocaine to a confidential government source last month. Other defendants include: Joseph Dean Taylor, Treson Blake Fugit, and Trevon Montel Monroe.
Officers recovered crack cocaine, marijuana, and a pistol with ammunition during the raids, which occurred late last month.
The Project Safe Neighborhoods - Amarillo initiative – a coalition of federal and local law enforcement focused on a high-crime hotspot in Amarillo – uses a three-pronged approach that combines traditional enforcement with community outreach and recidivism reduction to drive down violent crime.
Criminal charges are merely an allegations of wrongdoing, not evidence. All defendants in this case are presumed innocent until proven guilty in a court of law.
The joint operation was conducted by Amarillo DPS – Criminal Investigation Division, Amarillo DPS – Texas Highway Patrol, Amarillo DPS Air-Wing, the Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms & Explosives, the Amarillo Police Department, the U.S. Marshals’ North Texas Fugitive Task Force, Homeland Security Investigations, the Federal Bureau of Investigation, and the Randall County Sheriff’s Office. Assistant U.S. Attorneys Josh Frausto and Sean Taylor are prosecuting the case.
Previously Convicted Sex Offender from Albuquerque Sentenced to 330 Months in Federal Prison for Making Child PornographyRead the Press Release
ALBUQUERQUE – James Highfield, 64, of Albuquerque, N.M., was sentenced in federal court on June 4, 2019, to 330 months in prison on six counts of production of visual depictions of children engaged in sexually explicit conduct.
Highfield previously pleaded guilty to these offenses on February 22, 2019. In his plea agreement, he admitted using his cellular telephone to take sexually explicit photographs of three children less than 18 years old from September 22, 2017, to October 15, 2017. Highfield committed these offenses although he was required to register as a sex offender based on prior convictions for other sexual offenses.
Homeland Security Investigations and the Bernalillo County Sheriff’s Office investigated this case with the Second Judicial District Attorney’s Office. Assistant U.S. Attorney Sarah Mease prosecuted the case as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s Criminal Division’s Child Exploitation and Obscenity Section, 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 information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
The case also was brought as a part of the New Mexico Internet Crimes Against Children (ICAC) Task Force’s mission, which is to locate, track, and capture Internet child sexual predators and Internet child pornographers in New Mexico. There are 86 federal, state and local law enforcement agencies associated with the New Mexico ICAC Task Force, which is funded by a grant administered by the New Mexico Attorney General’s Office. Anyone with information relating to suspected child predators and suspected child abuse is encouraged to contact federal or local law enforcement.
Owner of Lewiston Counseling Agency Convicted of Health Care FraudRead the Press Release
Portland, Maine. United States Attorney Halsey B. Frank announced Nancy Ludwig, 65, of Lewiston, Maine, was convicted in U.S. District Court following a 5-day jury trial of health care fraud conspiracy, paying kickbacks, using fraudulent medical documents, and obstructing an audit.
According to testimony at trial, Ludwig was the owner of Facing Change, a mental health and substance abuse counseling agency in Lewiston. Abdirashid Ahmed was a Somali interpreter. From about November 2015 until May 2018, Ludwig conspired with Ahmed and others to commit health care fraud. The evidence showed that beginning in February 2015, Ludwig agreed to pay Ahmed a kickback in return for Ahmed bringing MaineCare beneficiaries to Facing Change. Ahmed and other employees at Facing Change then submitted false claims to MaineCare for counseling and interpreter services. In 2016, in response to a MaineCare regulatory change, Ludwig and Ahmed conspired to change the diagnosis of many of those clients to schizophrenia so they could remain eligible to receive MaineCare reimbursement for services at Facing Change. In 2016, auditors with the MaineCare Program Integrity Unit audited Facing Change. Ludwig and many of her employees conspired to manufacture false records in an attempt to deceive the auditor. The fraud continued until May 1, 2018 when federal and state agents executed search warrants at Facing Change and Ahmed’s business.
Ludwig faces up to ten years in prison, three years of supervised release and a $250,000 fine. She will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
On May 24, 2019, Ahmed pleaded guilty to conspiring to commit health care fraud. In addition to Ahmed and Ludwig’s convictions, five other individuals have been convicted of federal health care crime felonies for their involvement in this case and two other individuals have agreed to civil settlements.
These convictions and civil settlements are the result of a three-year collaborative investigation conducted by the U.S. Department of Health and Human Services-Office of Inspector General, the FBI, and the Maine State Medicaid Fraud Control Unit. The investigation started because of the auditing work done by the MaineCare Program Integrity Unit.
Owner of Mortgage Elimination Company Found Guilty in White Plains Federal Court of $38 Million Fraud ConspiracyRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that JACQUELINE GRAHAM was convicted at trial on Wednesday, June 12, 2019, of participating in a conspiracy to commit bank fraud, wire fraud, and mail fraud in connection with a fraudulent debt-elimination scheme to defraud homeowners and banks. GRAHAM was found guilty of the one count she faced after a two-week trial before U.S. District Judge Nelson S. Román.
Manhattan U.S. Attorney Geoffrey S. Berman said: “Jacqueline Graham preyed on vulnerable homeowners who could not afford their mortgage payments during a time of crisis in the housing market. Because of her greed, these homeowners ended up financially worse off than when they found her. We will continue to work with our law enforcement partners to bring to justice those who victimize the vulnerable.”
According to the Indictment in the case and the evidence presented at trial:
From at least 2011 to at least 2012, JACQUELINE GRAHAM partnered with Bruce Lewis and John Ruzza in operating the Valhalla, New York-based Terra Foundation (“Terra”) – which was originally known as the Pillow Foundation – which held itself out as a business that would investigate and eliminate mortgage loans in exchange for fees, soliciting clients who were having difficulties making their mortgage payments. In fact, however, Terra engaged in a wide-ranging scheme to defraud clients, county clerks’ offices, and banks.
The fraudulent scheme, which was created by GRAHAM and Lewis, involved Terra performing “audits” of clients’ mortgages, sending pseudo-legal paperwork to the banks and/or lenders holding the mortgages, and ultimately filing purported mortgage discharges with the relevant county clerks’ offices, which discharges were signed by Lewis or other co-conspirators, claiming falsely to represent the banks and/or mortgage lenders. As a result, anyone doing a title search for one of Terra’s clients would see that the client’s mortgage had been satisfied. The mortgages had not, however, been discharged, and the mortgages were eventually reinstated, after the clients paid their fees.
In order to effectuate the scheme, GRAHAM, Lewis, and Ruzza involved others, including Rocco Cermele, who was Terra’s director of operations and who recruited clients, among other duties; Paula Guadagno, who did real estate title work for, and filed discharges on behalf of, Terra; and Anthony Vigna, a lawyer and CPA who worked in Terra’s offices.
To profit from their scheme, GRAHAM and her co-conspirators charged various fees to Terra’s clients.
In total, GRAHAM and her co-conspirators filed over 60 fraudulent discharges in Westchester and Putnam Counties in New York, and in Connecticut. The fraudulent discharges claimed to discharge mortgages with a total loan principal of nearly $38 million.
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GRAHAM, 53, formerly of Levittown, Pennsylvania, was convicted of one count of conspiracy to commit bank fraud, wire fraud, and mail fraud. The count carries a maximum sentence of 30 years in prison.
Lewis, 67, formerly of Alaska and Washington State, pled guilty to one count of wire fraud relating to the Terra scheme, which carries a maximum sentence of 20 years in prison.
Vigna, 61, of Thornwood, New York, pled guilty to one count of participating in a conspiracy to commit bank fraud, wire fraud, and mail fraud relating to the Terra scheme, which carries a maximum sentence of five years in prison.
Cermele, 56, of Yonkers, New York, pled guilty to one count of participating in a conspiracy to commit mail, wire, and bank fraud, and one count of wire fraud, each relating to the Terra scheme, each of which carries a maximum potential sentence of 30 years in prison, and three additional counts of wire fraud relating to other crimes, each of which carries a maximum potential sentence of 20 years in prison.
The statutory maximum penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendants would be determined by the court.
All defendants are awaiting sentencing.
Mr. Berman praised the outstanding investigative work of the Federal Bureau of Investigation. Mr. Berman also thanked the Office of the Westchester County District Attorney’s Office and the Department of Housing and Urban Development for their assistance in the case.
This case is being handled by the Office’s White Plains Division. Assistant United States Attorneys David Felton, Michael Maimin, and James McMahon are in charge of the prosecutions.
Omaha Man Sentenced to Five Years for Distributing Child PornographyRead the Press Release
United States Attorney Joe Kelly announced that Benjamin Kabourek, 36, of Omaha was sentenced today in federal court for distributing child pornography. The Honorable Robert F. Rossiter, Jr. sentenced Kabourek to 5 years’ imprisonment. There is no parole in the federal system. After his release from prison Kabourek will serve a 10-year term of supervised release and be required to register as a sex offender. Kabourek must also pay $2,000 in restitution to one of the children whose image he received and maintained on his computer.
Between December, 2016 and January, 2017 Kabourek was observed distributing images of child pornography over the internet. A federal search warrant was served by members of the FBI Child Exploitation Task Force. A search of Kabourek’s electronic devices revealed a video and 7 images of prepubescent minors engaged in sexually explicit conduct.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorney’s Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case was investigated by the Omaha FBI's Cyber Crime Task Force (CCTF).
Omaha Man Sentenced for Violent Crime SpreeRead the Press Release
United States Attorney Joe Kelly announced that U.S. District Judge Robert F. Rossiter, Jr. sentenced Tyree C. Carney, 26, today to 25 years in federal prison to be followed by 3 years of supervised release. Carney was also ordered to pay $192,898.22 in restitution for the money taken and losses sustained by victims. Carney previously pleaded guilty to conspiracy to commit robbery for his involvement in several crimes of violence between September 23, 2016 and June 12, 2017, and several counts of brandishing a firearm.
U.S. Attorney Kelly remarked, “Carney’s twenty-five year sentence sends a message that the most violent offenders will be imprisoned for lengthy periods of time where they can no longer prey on members of our community. The collaboration of multiple law enforcement agencies was instrumental in achieving Carney’s conviction.”
On September 23, 2016, Carney and another individual robbed the Springfield State Bank in Springfield, Nebraska. Brandishing a firearm, wearing gloves, sunglasses and covering his face Carney went behind the teller counter, demanded money, took a purse from a teller and filled it with $47,022.60 of the bank’s money. The robbers then fled the bank getting into a waiting car. On November 15, 2016, Carney and another individual robbed the American National Bank in Crescent, Iowa. They went into the bank with their faces concealed, displayed handguns, demanded employees get on the ground, and demanded the employees open their drawers and the bank vault. After getting the $94,028, they fled the bank in a vehicle they had carjacked from a woman in southeast Omaha earlier that day. After the robbery, the vehicle was found abandoned in north Omaha.
On March 25, 2017, Carney and another individual, while brandishing firearms and covering their faces, robbed the Cornerstone Bank in Murray, Nebraska. Several employees were ordered to the ground and had their hands zip-tied. One of the employees was ordered to empty the teller drawers and open the vault. Carney and his associate took an undisclosed amount of money and fled the bank. Around 8:15 a.m. on June 12, 2017, Carney and another individual were involved in carjacking a vehicle in north Omaha. Several hours later, they used that vehicle when they drove to the U.S. Bank in Underwood, Iowa and robbed it. With their identities concealed, they ordered employees to the ground, zip-tied them and were able to get into the vault. They left the bank, with $47,801, in the car they had stolen earlier. The bank robberies and carjackings formed the basis for the conspiracy and two of the firearm charges.
On May 15, 2018, Carney went into the Wells Fargo at 3536 Comstock in Bellevue, Nebraska, pointed a gun at a teller and demanded money. The bank had bulletproof glass at the teller counter. The teller did not comply with Carney’s demands and he left the bank. He pleaded guilty to brandishing a firearm during the attempted robbery.
"This sentence today reflects our determination to make an impact on violent crime in the Omaha metro area," said Acting Special Agent in Charge John Barrios. "We appreciate the active collaboration of our state and local partners who share our resolve to keep our communities safe."
The FBI Great Plains Violent Crime Task Force, comprised of FBI agents, Omaha Police Department detectives, Nebraska State Patrol Investigators and Papillion Police Department Detectives, is responsible for the investigation into the bank robberies for which Carney was convicted. The task force was assisted by Cass County Sheriff’s Office, Omaha Police Department Robbery Unit, Sarpy County Sheriff’s Office, Pottawattamie County Sheriff’s Office, and Bellevue Police Department.
Niagara Falls Man Going to Prison for Selling Cocaine and CrackRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Rico Freeman, 35, of Niagara Falls, NY, who was convicted of conspiracy to distribute five kilograms or more of cocaine and 280 grams or more of crack cocaine, was sentenced to serve 15 years in prison and 10 years of supervised release by U.S. District Judge Lawrence J. Vilardo.
Assistant U.S. Attorneys Meghan A. Tokash and Joseph M. Tripi, who handled the case, stated that between May 2016 and June 2017, the defendant conspired with others to operate a high-traffic and extremely profitable cocaine and crack cocaine distribution network in Western New York.
Freeman obtained quantities of cocaine and crack cocaine from a local source of supply during the course of this conspiracy. The defendant would then sell the cocaine and crack cocaine directly to customers, or have other co-defendants conduct sales on his behalf.
On May 24, 2017, federal agents executed a search warrant on Freeman's apartment on Main Street in Niagara Falls and seized drug scales and packaging. Residue collected from the scales tested positive for cocaine.
The defendant was arrested along with co-defendants Ramone Westbrook, Corey Bradberry, and Darius Dix, aka Darius Jenkins, who were all previously convicted.
The sentencing is the result of an investigation by the Drug Enforcement Administration, under the direction of Special Agent-in-Charge Ray Donovan, New York Field Division; the Bureau of Alcohol, Tobacco, Firearms, and Explosives, under the direction of Special Agent-in-Charge John B. Devito, New York Field Division; the Internal Revenue Service, Criminal Investigation Division, under the direction of Special Agent-in-Charge Jonathan D. Larson, New York Field Office; the Niagara County Drug Task Force and Sheriff’s Department, under the direction of Sheriff James Voutour; the Lockport Police Department, under the direction of Chief Stephen Preisch; the Niagara Falls Police Department, under the direction of Bryan DalPorto; and the Niagara County District Attorney’s Office, under the direction of Caroline A. Wojtaszek.
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Newton Woman Pleads Guilty to Commercial Driver’s License FraudRead the Press Release
Jackson, Miss. –Tonya Levera Davis, 49, of Newton, pled guilty today before U.S. District Judge Carlton W. Reeves to aggravated identity theft and to making false statements, announced U.S. Attorney Mike Hurst and Department of Transportation, Office of Inspector General Regional Special Agent in Charge Todd Damiani.
Davis was employed by the Mississippi Department of Public Safety, Newton Department of Motor Vehicles, as a driver’s license examiner. Her employment included the administration of driver’s license applications, both written and computer tests, as well as the administration of Commercial Driver’s License (CDL) testing. Davis was an authorized tester of the written skills portion of the CDL test, but not for the road skills portion.
From June 2016 through May 2018, Davis authorized CDLs to applicants that had not passed the written or road skills portions of the test. She sold CDLs to over 88 unqualified applicants by providing answers to the written skills test. She would further pass the unqualified applicant and use state issued identification numbers of other third party testers to pass unqualified applicants and issue fraudulent CDLs.
Davis is scheduled to be sentenced by Judge Reeves on September 13, 2019, at 8:45 a.m. She faces a maximum penalty of 5 years in federal prison and a $250,000.00 fine.
The case was investigated by the United States Department of Transportation-Office of Inspector General, Federal Bureau of Investigation, Mississippi Department of Public Safety, Mississippi Bureau of Investigation and the Federal Motor Carrier Safety Administration. It is being prosecuted by Assistant United States Attorney Erin Chalk.
New York Man Sentenced to 20 Years in Prison for Attempting to Join ISIS in YemenRead the Press Release
Earlier today in federal court in Brooklyn, Mohamed Rafik Naji was sentenced to 20 years imprisonment to be followed by five years supervised release by United States District Judge Frederic Block for attempting to provide material support or resources to the Islamic State of Iraq and al-Sham (ISIS), a foreign terrorist organization. Naji pleaded guilty to the charge in February 2018.
Assistant Attorney General for National Security John C. Demers, U.S. Attorney Richard P. Donoghue for the Eastern District of New York, Assistant Director-in-Charge William F. Sweeney Jr. of the FBI’s New York Field Office and Commissioner James P. O’Neill of the New York City Police Department (NYPD) announced the sentence.
“Time and again, the United States has brought to justice those who have traveled from here to try and fight for ISIS,” said Assistant Attorney General Demers. “This is just what Naji did. Today’s sentence holds him accountable for his crime and I want to thank the agents, analysts, and prosecutors who are responsible for this result.”
“With today’s sentence, Naji has been held accountable for trying to enter a foreign war zone and join ISIS’ murderous cause,” said United States Attorney Donoghue. “This Office, together with the FBI, the NYPD and all the members of the FBI Joint Terrorism Task Force will take every step necessary to incapacitate terrorists like Naji and protect the American people. I commend the Task Force for its outstanding work in this case.”
“Extremists like Mr. Naji believe murdering innocent people advances their political agendas,” said FBI Assistant Director-in-Charge Sweeney. “In the end, Mr. Naji, like many others before him, find the only thing their actions lead to is a different vantage point from which to watch the world pass by – through the steel bars of a federal prison. Mr. Naji will remember today as sentencing day, nothing more. Working day in and day out with our partners on the FBI Joint Terrorism Task Force, safeguards have been put in place to secure Times Square and other popular attractions so any would be terrorist will find it extremely difficult to carry out their plans. Our unified goal is to remain proactive and prevent acts before they occur, and once again I would like to thank all of those who ensure our safety.”
“This case is a reminder that New York City remains the top target for terrorism in the U.S.,” said NYPD Commissioner O’Neill. “The NYPD and its partners in law enforcement will never relent in the fight against terror. I want to thank the dedicated members of the JTTF who worked on this investigation to keep our City safe and the prosecutors from the Eastern District of New York.”
By late 2014, Naji had become a committed supporter of ISIS’s murderous cause as he repeatedly promoted and distributed ISIS propaganda with violent themes and messages on social media. In March 2015, Naji traveled from New York to Yemen in an effort to join ISIS. Naji also used social media to advise another person he could travel to join ISIS, but unbeknownst to Naji, that individual was a confidential source of information for the government (the CS). In an online conversation with the CS, Naji proclaimed his allegiance to ISIS, stating, “I belong to Islamic state only.”
Following his return to the United States in September 2015, Naji continued to express his support for ISIS and violent jihad. In July 2016, following the ISIS-inspired terrorist truck attack in Nice, France, that killed scores of innocent civilians, Naji told the CS how easy it would be to carry out a similar attack in Times Square, explaining that ISIS “want[s] an operation in Times Square” and stating that an ISIS “reconnaissance group . . . put up scenes of Times Square.” Naji further explained, “if there is a truck, I mean a garbage truck and one drives it there to Times Square and crushes them . . . Times Square day.”
Naji has been incarcerated since his arrest in Brooklyn in November 2016.
The government’s case is being handled by the Office’s National Security and Cybercrime Section. Assistant United States Attorney Ian C. Richardson is in charge of the prosecution, with assistance from Trial Attorney Jacqueline L. Barkett of the National Security Division’s Counterterrorism Section.
New Salem Man Charged with Child Pornography OffensesRead the Press Release
BOSTON - A New Salem man was charged yesterday in federal court in Springfield with child pornography offenses.
Nicholas Conkey, 33, was charged with two counts of distribution of child pornography, two counts of receipt of child pornography, and one count of possession of child pornography.
At various times in 2018 and 2019, Conkey is alleged to have sent and received child pornography by email. On Jan. 18, 2019, he is alleged to have been in possession of child pornography depicting children younger than 12-years-old.
Possession of child pornography carries a sentence of no greater than 20 years in prison and the charges of distribution and receipt of child pornography carry a mandatory minimum sentence of five years and up to 20 years in prison. All three charges provide for a mandatory minimum sentence of five years and up to a lifetime of supervised release and a fine of up to $250,000 fine. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling and Peter C. Fitzhugh, Special Agent in Charge of Homeland Security Investigations in Boston, made the announcement. Assistant U.S. Attorney Alex J. Grant of Lelling’s Springfield Branch Office is prosecuting the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ offices and CEOS, Project Safe Childhood marshals federal, state and local resources to 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.
The details contained in the charging document are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
New Orleans Man Pleads Guilty to Hancock Whitney Bank RobberyRead the Press Release
NEW ORLEANS – U.S. Attorney Peter G. Strasser announced that JOHN L. MURRAY, age 66, pled guilty yesterday before United States District Judge Eldon E. Fallon to a one count indictment for bank robbery in violation of Title 18, United States Code, Section 2113(a).
According to court documents, MURRAY robbed the Hancock Whitney Bank located at 2421 St. Claude Avenue in New Orleans, Louisiana on February 13, 2019. MURRAY faces a sentence of up to twenty years, a $250,000.00 fine, and three years of supervised release after imprisonment. Sentencing is scheduled for September 19, 2019 at 2:00 p.m.
U.S. Attorney Strasser praised the work of the Federal Bureau of Investigation and the New Orleans Police Department in investigating this matter. Assistant United States Attorney Julia K. Evans is in charge of the prosecution.
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New Jersey Broker Pleads Guilty in “Cherry-Picking” SchemeRead the Press Release
BOSTON – A former New Jersey securities broker pleaded guilty in federal court in Newark, N.J. today to charges of defrauding his clients by engaging in a multi-year “cherry-picking” scheme.
Michael Bressman, 61, of Montville, N.J., formerly of FCG Advisors and FCG Wealth Management in Chatham, N.J., pleaded guilty to securities fraud and investment advisor fraud. U.S. District Judge Esther Salas of the District of New Jersey scheduled sentencing for November 2019. On Sept. 11, 2018, Bressman was charged by indictment in the District of Massachusetts, and the case was transferred to the District of New Jersey on Nov. 8, 2018.
Bressman misused his access to an omnibus or “allocation” account to obtain at least $700,000 in illicit trading profits over a six-year period ending in February 2018. Bressman used the allocation account to place trades and cherry-picked profitable trades, which he then transferred to his own account and the account of family members, while placing unprofitable trades in other customers’ accounts.
The charge of securities fraud provides for a sentence of no greater than 20 years in prison, five years of supervised release and a fine of $5 million. The charge of investment advisor fraud provides for a sentence of no greater than five years in prison, two years of supervised release and a fine of $250,000. Sentences are imposed by a federal district court judge based on the U.S. Sentencing Guidelines and other statutory factors. Pursuant to the plea agreement, the government recommended a sentenced of 24 to 40 months in prison.
United States Attorney Andrew E. Lelling and Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division made the announcement today. The SEC’s Market Abuse Unit in New York provided assistance with the investigation. Assistant U.S. Attorney Eric Rosen of Lelling’s Securities and Financial Fraud Unit and Assistant U.S. Attorney Courtney Howard of the District of New Jersey are prosecuting the case.
Nashville Heroin Distributor Sentenced to 30 Years in Federal PrisonRead the Press Release
NASHVILLE, Tenn. – June 14, 2019 – Brandon Bradford, 40, of North Chicago, Illinois, was sentenced yesterday in U.S. District Court to 30 years in prison for conspiring to distribute a kilogram or more of heroin, announced U.S. Attorney Don Cochran for the Middle District of Tennessee. Bradford was convicted by a federal jury in November 2018, following a four-day trial.
Bradford, along with Terrell Pierson, aka, Tank, 33, and Justin Joplin, aka, Fat Boy, 35, both from the Chicago area, and Krystin Pape, 33, of Nashville, were indicted in May 2016 and later pleaded guilty. Pierson and Joplin were previously sentenced to 10 years in federal prison and Pape will be sentenced next week.
“I commend our prosecution team and our law enforcement partners at the Metropolitan Nashville Police Department and the FBI for working to build a strong case and disrupt the supply of heroin coming to our community,” said U.S. Attorney Cochran. “This case is just one of many that these dedicated individuals undertake on a daily basis and I’m grateful for their commitment to do all they can to make Nashville and Middle Tennessee a safer place.”
The prosecution arose out of an investigation into heroin trafficking by the Metropolitan Nashville Police Department’s Gang Unit and the FBI in 2015, which identified Brandon Bradford as a heroin supplier who was obtaining large quantities of heroin from the Chicago, Illinois area. Bradford conspired with several others, including Pape, Pierson and Joplin, to obtain multiple kilograms of heroin from the Chicago area on a regular basis and to distribute that heroin in the Nashville area from around September of 2014 through April 20, 2016. Based on the evidence at trial, Bradford was conservatively responsible for more than 18 kilograms of heroin that were sold on the streets of Nashville.
The evidence at trial revealed that the amounts transported from the Chicago area for distribution in Nashville during the conspiracy ranged from approximately 50-100 grams and increased quickly to kilogram quantities as the conspiracy progressed. As the operation grew larger, Bradford directed Pierson and Joplin, his half-brother, to move from the Chicago area to Nashville to assist him in running the operation, along with Pape. Bradford and they shared a residence in the Bellevue area of Nashville where they frequently repackaged and prepared heroin for delivery to customers in Nashville. Bradford, as the leader of the operation, determined the pricing for the heroin and controlled the money.
Pape and Joplin were arrested when a search warrant was executed at the residence on Stacy Drive, on April 20, 2016, and Pierson was arrested shortly thereafter. Bradford was arrested 15 months later, in August 2017, at a hotel in New Albany, Indiana, after being actively sought by law enforcement. At the time of his arrest, Bradford was in possession of more than 300 grams of heroin.
“This sentencing is the culmination of a collective effort between federal and local law enforcement to combat heroin trafficking in our community," said Special Agent in Charge of the Memphis Division of the Federal Bureau of Investigation M. A. Myers. "We will continue to be relentless in our mission to disrupt and dismantle drug trafficking organizations and bring the criminals who run them to justice.”
“MNPD officers and our federal partners are so serious about interdicting heroin and holding traffickers accountable because people are dying,” Chief Steve Anderson said. “Nearly four times as many persons died in Nashville last year from drug overdoses than from the crime of murder. I am grateful for the relationship we share with the U.S. Attorney’s Office and other federal law enforcement agencies as we investigate cases like this.”
This case was prosecuted by Assistant U.S. Attorneys Phillip H. Wehby and Brooke K. Schiferle.
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Monroe County Man Was Sentenced to 11 Years in Prison for Role in Heroin and Cocaine Trafficking ConspiracyRead the Press Release
WILKES-BARRE - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Joseph Morales, age 27, of Tobyhanna, Pennsylvania, was sentenced on June 12, 2019, by Senior U.S. District Court Judge A. Richard Caputo to eleven years’ imprisonment and ten years on supervised release for his role in a Monroe County-based heroin and cocaine trafficking conspiracy.
According to United States Attorney David J. Freed, Morales previously pleaded guilty to conspiring with others to distribute between 700 grams and one kilogram of heroin (which is equivalent to 28,000 to 40,000 individual doses of heroin), as well as between 840 grams and 2.8 kilograms of crack cocaine, in the Monroe County area between May and July 2015. Morales was one of eleven individuals indicted by a grand jury in July 2015 and charged with conspiring to distribute heroin, powder cocaine and crack cocaine in the Monroe County area.
The case was investigated by the Drug Enforcement Administration (DEA) and the Pocono Mountain Regional Police Department. Assistant United States Attorney Robert J. O’Hara prosecuted the case.
This case is part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local and tribal enforcement and the local community to develop effective, locally-based strategies to reduce crime.
This case was also brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.
This prosecution is also part of an extensive investigation by the Organized Crime Drug Enforcement Task Force (OCDETF). OCDETF is a joint federal, state, and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional level drug trafficking organizations and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.
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Monroe County Man Pleads Guilty to Heroin and Cocaine TraffickingRead the Press Release
WILKES-BARRE - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Sherquille Ernest, age 26, of Mount Pocono, Pennsylvania, pleaded guilty on June 12, 2019, before U.S. District Court Senior Judge A. Richard Caputo to the charge of conspiracy to distribute heroin and crack cocaine.
According to United States Attorney David J. Freed, Morales admitted to participating in a conspiracy to distribute between 20 and 40 grams of heroin (which is equivalent to 800 to1,600 individual doses of heroin), as well as between 28 and 112 grams of crack cocaine, in the Monroe County area between May and July 2015. Ernest was one of eleven individuals indicted by a grand jury in July 2015, and charged with conspiring to distribute heroin, powder cocaine and crack cocaine in the Monroe County area.
Judge Caputo ordered a presentence report to be completed. Sentencing will be scheduled at a later date.
The investigation was conducted by the Drug Enforcement Administration (DEA) and the Pocono Mountain Regional Police Department. Assistant United States Attorney Robert J. O’Hara is prosecuting the case.
This case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The charge carries a mandatory minimum sentence of five years in prison. The maximum penalty under federal law is up to forty years in prison, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Minnesota Attorney Sentenced to 168 Months in Prison for Multi-Million Dollar Pornography Film Copyright Fraud SchemeRead the Press Release
United States Attorney Erica H. MacDonald today announced the sentencing of PAUL R. HANSMEIER, 37, to 168 months in prison for orchestrating a multi-million dollar fraud scheme to obtain payments from extortion victims to settle sham copyright infringement lawsuits by lying to state and federal courts throughout the country. HANSMEIER, who pleaded guilty on August 17, 2018, was sentenced today before Judge Joan N. Ericksen in U.S. District Court in Minneapolis, Minnesota. HANSMEIER’S co-defendant JOHN L. STEELE also pleaded guilty to his role in the scheme. STEELE is scheduled to be sentenced on July 9, 2019.
United States Attorney Erica MacDonald said, “Paul Hansmeier abandoned his sworn oath to uphold the law and chose instead to use coercion and lies to exploit victims and deceive judges. The sentence he received today is a just consequence for his actions.”
“Today's sentence for Paul Hansmeier is the just result for an attorney who abused his license to practice law and disgraced himself and the bar in so many ways,” said Jill Sanborn, Special Agent in Charge of the FBI's Minneapolis Division. “Hansmeier’s role in this salacious fraud scheme exploited victims by misusing his position of trust as an officer of the court. The FBI is grateful for the victims who came forward in this case because their information was critical to our work.”
“Today justice has been served with the fourteen-year sentencing of Mr. Hansmeier,” stated Tara Sullivan, IRS Criminal Investigation Special Agent in Charge of the Chicago Field Office. “Mr. Hansmeier greatly misused his position as an attorney by preying upon unsuspecting individuals for nothing but pure power and greed. IRS Criminal Investigation is proud to have worked alongside with the U.S. Attorney’s Office and the FBI to dismantle this money laundering enterprise created by Hansmeier and his partner.”
According to his guilty plea and documents filed in court, between 2011 and 2014, HANSMEIER and STEELE, both practicing lawyers, executed a scheme to obtain millions of dollars by threatening copyright lawsuits against individuals who allegedly downloaded pornographic movies from file-sharing websites. HANSMEIER admitted in court during his plea that he and STEELE created a series of sham entities, which he and STEELE surreptitiously controlled, to obtain copyrights to pornographic movies – some of which they filmed themselves – and then uploaded those movies to file-sharing websites like “The Pirate Bay” in order to lure people to download the movies. The defendants then filed bogus copyright infringement lawsuits that concealed both their role in distributing the movies, and their personal stake in the outcome of the litigation. After filing the lawsuits, HANSMEIER and STEELE gained authority from the courts to subpoena internet service providers (“ISPs”) for identification information of the subscriber who controlled the IP address used to download the movie. With that information, the defendants used extortionate tactics such as letters and phone calls to threaten victims with enormous financial penalties and public embarrassment unless they agreed to pay a $3,000 settlement fee.
According to the Indictment, the plea agreement, and other court documents, in November 2011, in order to distance themselves from the specious lawsuits and any potential fallout, HANSMEIER and STEELE created and used Prenda Law, among other law firms, to pursue their fraudulent lawsuits. HANSMEIER acknowledged at his plea hearing that he and STEELE exerted de facto control over Prenda Law throughout the scheme, but recruited a now-deceased Illinois attorney to pretend to own and control the law firm.
In October 2012, the defendants changed their tactics and began filing lawsuits falsely alleging that computer systems belonging to their sham clients had been hacked. To facilitate their phony “hacking” lawsuits, HANSMEIER and STEELE recruited individuals who had been caught downloading pornography from a file-sharing website, to act as ruse “defendants.” These ruse defendants agreed to be sued and permit HANSMEIER and STEELE to conduct early discovery against their supposed “co-conspirators” in exchange for HANSMEIER and STEELE waiving their settlement fees. During his plea hearing, HANSMEIER admitted that the allegations of “hacking” in these complaints were made up.
In total, HANSMEIER and STEELE obtained approximately $3 million from the fraudulent copyright lawsuits.
This case is the result of an investigation conducted by the FBI and the Criminal Investigation Division of the IRS.
Assistant U.S. Attorneys Benjamin F. Langner and David J. MacLaughlin of the District of Minnesota, and Senior Trial Counsel Brian Levine of the Criminal Division’s Computer Crime and Intellectual Property Section, prosecuted the case.
Defendant Information:
PAUL R. HANSMEIER, 37
Woodbury, Minn.
Convicted:
- Conspiracy to commit mail fraud and wire fraud, 1 count
- Conspiracy to commit money laundering, 1 count
Sentenced:
- 168 months in prison
- Two years of supervised release
- Restitution in the amount of $1,541,527.37
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
Mexican Citizen Pleads Guilty to Drug Conspiracy and Immigration ChargeRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Giovani Ramirez-Soto, 27, a citizen of Mexico, pleaded guilty before Senior U.S. District Judge William M. Skretny to conspiracy to possession with intent to distribute, and to distribute, one kilogram or more of heroin. Soto also pled guilty to being a removed alien unlawfully found in United States. The charges carry a mandatory minimum penalty of 10 years in prison, a maximum of life, and a $10,000,000 fine.
Assistant U.S. Attorney Timothy C. Lynch, who is handling the case, stated that beginning sometime in 2018 and continuing until July 26, 2018, the defendant conspired with co-defendant Humberto Martinez-Vega to sell heroin.
On July 26, 2018, a New York State Police Trooper conducted a traffic stop of a red Honda Accord, with Alabama license plates, driving on Route 20A in the Town of Warsaw in Wyoming County. The trooper approached the vehicle, which was being driven by Martinez-Vega with Ramirez-Soto as a passenger. Martinez-Vega gave the trooper an expired Georgia identification card, and told the trooper he was looking for work.
Martinez-Vega gave the trooper consent to search the vehicle. A NYSP K9 Trooper was brought to the scene. The K9 alerted to several areas of the vehicle and a subsequent search recovered 1,200 grams of suspected heroin, and approximately 421 grams of suspected methamphetamine hidden behind the front dashboard of the vehicle.
Further investigation determined that the defendants were illegally present in the United States.
Charges remain pending against Humberto Martinez-Vega. The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
The plea is the result of an investigation by the New York State Police, under the direction of Major Edward Kennedy, and the Drug Enforcement Administration, under the direction of Special Agent-in-Charge Ray Donovan, New York Field Division.
Sentencing is scheduled for September 25, 2019, at 11:00 a.m. before Judge Skretny.
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Member of Maryland MS-13 Extortion Operation in DC Suburbs Is Convicted After Federal TrialRead the Press Release
Greenbelt, Maryland –A federal jury has convicted Gerdandino Delgado-Escobar, a/k/a “Pumba,” age 24, of Hyattsville, a member of La Mara Salvatrucha, or MS-13, of conspiracy to interfere with interstate commerce by extortion. The verdict was returned late on June 13, 2019.
The guilty verdict was announced by United States Attorney for the District of Maryland Robert K. Hur; Acting Assistant Director in Charge John P. Selleck of the FBI Washington Field Office; Special Agent in Charge Jennifer C. Boone of the Federal Bureau of Investigation, Baltimore Field Office; Acting Special Agent in Charge Cardell T. Morant of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Baltimore Field Office; Special Agent in Charge Jesse R. Fong of the U.S. Drug Enforcement Administration (DEA) Washington Field Division; Acting Chief Marcus Jones of the Montgomery County Police Department; Chief Henry P. Stawinski III of the Prince George’s County Police Department; Chief Amal Awad of the City of Hyattsville Police Department; Prince George’s County State’s Attorney Aisha Braveboy; and Montgomery County State’s Attorney John McCarthy.
“We will not tolerate the fear and violence perpetrated by MS-13 in Maryland,” said U.S. Attorney Robert K. Hur. “This prosecution sends a strong message to MS-13 gang members that federal, state, and local law enforcement will continue to work together to find and bring to justice MS-13 members who prey on our neighborhoods.”
MS-13 is a violent gang composed primarily of immigrants or descendants of immigrants from El Salvador, with members operating in the State of Maryland, including Montgomery County, Prince George’s County, Anne Arundel County, and Frederick County, and throughout the United States. Branches or “cliques” of MS-13 often work together cooperatively as “Programs,” with the purpose of increasing the gang’s levels of organization, violence, extortion, and other criminal activity, and to assist one another in avoiding detection by law enforcement.
According to trial evidence, in the Washington, DC metropolitan area, MS-13 generated income from various sources, including the extortion of money from businesses. Targeted businesses included drug dealers, brothels, unlicensed “stores” where food, alcoholic beverages, and cigarettes were sold, as well as legitimate businesses, including food and beverage sellers and distributors.
The evidence presented at the four-day trial proved that Delgado-Escobar was a member and associate of the Langley Park Salvatrucha (“LPS”) clique of MS-13. From at least March 2013, Delgado-Escobar, working with other MS-13 members and associates, extracted weekly extortion payments known as “rent” from victim business owners for operating in territory controlled by the LPS and Sailors cliques of MS-13. According to trial testimony, the payments were generally about $40 to $50 per week for beer delivery businesses and around $115 per week for brothel owners.
As proven during the trial, Delgado-Escobar and his co-conspirators extorted numerous business owners operating in the Langley Park area. Delgado-Escobar conspired with other MS-13 members and associates to obtain money from the victims through the use of actual and threatened force, violence, and fear. According to the trial evidence, in one instance a victim who delivered beer was grabbed by the neck, had a gun put to his head and was threatened with the murder of his entire family if the victim did not pay MS-13 for operating a business in its territory. MS-13 members referred to these extortion payments as “rent.”
Delgado-Escobar remains detained pending his sentencing, which has not yet been scheduled.
U.S. Attorney Robert K. Hur thanked the FBI Washington and Baltimore Field Offices, HSI Baltimore, the DEA Washington Field Office, the Prince George’s County Police Department, the Montgomery County Police Department, the Prince George’s County State’s Attorney’s Office, the City of Hyattsville Police Department, and the Montgomery County State’s Attorney’s Office for their work in this investigation. Mr. Hur commended Assistant U.S. Attorneys William D. Moomau and Catherine K. Dick, who are prosecuting this case.
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Media Advisory – Peninsula Violent Crime SummitRead the Press Release
WHAT: Federal, state, and local law enforcement and community partners will hold the Peninsula Violent Crime Summit on Monday, June 17, at NASA’s Langley Research Center in Hampton.
WHERE: NASA Langley Research Center, 2 Langley Blvd, Hampton, VA
WHEN: Arrive at NASA June 17 at 3:45 p.m.
DETAILS: Members of the media are invited to attend the final wrap-up of the event from approximately 4:00 p.m. to 4:30 p.m. Photography and B-Roll videography will be permitted inside of the event hall only.
Following the wrap-up, co-hosts of the summit will hold a press conference and take questions. After the press conference, select law enforcement officials will be available for one-on-one interviews. Community partners may also be available for one-on-one interviews.
RSVP: Please RSVP by Noon on June 17 to Joshua Stueve at: [email protected]. If you do not RSVP, you will NOT be permitted to enter the facility. No exceptions.
CO-HOSTS: U.S. Attorney G. Zachary Terwilliger; Chief Terry Sult, Hampton Police Division; Chief Steve Drew, Newport News Police; Commonwealth’s Attorney Howard Gwynn, Newport News Commonwealth’s Attorney’s Office; Deputy Commonwealth’s Attorney Sheree Konstantinou, Hampton Commonwealth’s Attorney’s Office.
LAW ENFORCEMENT PARTNERS: Federal Bureau of Investigation (FBI); Drug Enforcement Administration (DEA); Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF); U.S. Postal Inspection Service; U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Gloucester Sheriff’s Office; Virginia State Police; James City County Police; York-Poquoson Sheriff's Office; York County Commonwealth’s Attorney’s Office.
COMMUNITY PARTNERS: Newport News City Council; Ministers to the Queens Plaza Community; Newport News Youth Gang Outreach Unit; CBC World Ministry; Newport News Police Homicide Support Group; Catalyst Effect; Phantom Eagle Engineering; Newport News Citizens United for Action; Hawkins, Burcher & Boester; others.
Media AdvisoryRead the Press Release
CEDAR RAPIDS, IA – On June 17, 2019, five men will be sentenced in federal district court in Cedar Rapids, Iowa, following their convictions for drug, robbery, and gun crimes related to the fatal shooting of an individual in Coggon, Iowa, in February 2017. On June 18, 2019, at 11:00 a.m. the United States Attorney’s Office and the Linn County Sheriff’s Office will hold a press conference at the United States Attorney’s Office in the federal courthouse, 111 Seventh Avenue SE, in Cedar Rapids to announce the results of those sentencing hearings.
Additionally, United States Attorney Peter E. Deegan, Jr. will announce recent Project Safe Neighborhood gun charges in Eastern Iowa at the press conference. Representatives from federal and local law enforcement will be present.
Event Details
When: June 18, 2019
Where: Cedar Rapids Federal Courthouse (United States Attorney’s Office), 111 Seventh Avenue SE
Time: 11:00 a.m.
A press release will be provided and interview opportunities will be available.
Please RSVP to Tony Morfitt at [email protected] if you plan to attend.
Follow us on Twitter @USAO_NDIA.
Massachusetts Man Pleads Guilty to Fentanyl TraffickingRead the Press Release
Portland, Maine: United States Attorney Halsey B. Frank announced that Cameron Soto, 26, of Fairhaven, Massachusetts, pleaded guilty yesterday in U.S. District Court to distribution of fentanyl.
According to court records, on March 14, 2017, the defendant distributed fentanyl to a resident of St. George, Maine who died as a result. The following day, the defendant distributed fentanyl to a person working with law enforcement.
As a result of the plea, the defendant faces between 16 and 24 years in prison, a $2,000,000 fine and six years to life on supervised release. He will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
This case was investigated by the Maine Drug Enforcement Agency, the Knox County Sheriff’s Office and Rockland Police Department, with assistance from the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Massachusetts Chiropractor Pleads Guilty to Tax EvasionRead the Press Release
The owner of a chiropractic business pleaded guilty today to tax evasion, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.
According to an indictment filed in June 2018, Richard Rogers, a Northborough, Massachusetts, chiropractor, operated his practice from his residence. Rogers was charged with evading his taxes from 2012 through 2016 by concealing his income from the Internal Revenue Service (IRS) through a variety of methods. Rogers encouraged his clients to pay in cash, used a nominee bank account to negotiate check payments when he was not paid in cash, paid creditors using postal money orders, and used credit card accounts opened with a fictitious social security number. Rogers also concealed the ownership of his residence by titling the property in the name of a trust. Rogers did not file federal tax returns from at least 2008 through 2016, despite his obligation to do so.
United States District Judge Timothy S. Hillman scheduled sentencing for Sept. 10, 2019. Rogers faces a maximum sentence of five years in prison, three years of supervised release, and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman thanked special agents of IRS-Criminal Investigation, who conducted the investigation, and Assistant Chief John N. Kane and Trial Attorney Carl F. Brooker of the Tax Division, who are prosecuting the case.
Additional information about the Tax Division’s enforcement efforts can be found on the division’s website.
Maryland Man Sentenced to Five Years for Role in Large-Scale Narcotics ConspiracyRead the Press Release
WASHINGTON – Lonnell Tucker, 42, of Temple Hills, Md., was sentenced today to five years in prison stemming from his role in a large-scale narcotics conspiracy, announced U.S. Attorney Jessie K. Liu, Ashan M. Benedict, Special Agent in Charge of the Washington Field Division of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), and Peter Newsham, Chief of the Metropolitan Police Department (MPD).
Tucker, Anthony Fields, 45, of Washington, D.C., and Abdul Samuels, 45, of Washington, D.C., were found guilty on March 21, 2019, following a trial in the U.S. District Court for the District of Columbia before the Honorable Amit P. Mehta. Tucker was convicted of conspiracy to distribute and possess with intent to distribute heroin from on or about June 1, 2017 through February 1, 2018. Judge Mehta sentenced Tucker to a prison term of five years. Following his prison term, Tucker will be placed on 36 months of supervised release.
In June 2017, ATF began investigating the trafficking of narcotics from the Next Level Cuts barbershop located in the 2400 block of MLK, Jr., Avenue, SE and adjoining property above. Law enforcement discovered a coordinated drug trafficking operation that was centered at the barbershop and extended into Maryland through surveillance, controlled purchases from inside and outside the barbershop, residential search warrants, cellphone searches, arrests, jailhouse calls, pleas, and cooperating witnesses. The investigation established that drug traffickers used the barbershop and adjoining property as a stash location.
The investigation led to a series of arrests beginning in February 2018. These arrests led to the recovery of three firearms from the barbershop, one firearm in a residence, the seizure of more than $7,000 in cash, and without packaging, the seizure of more than 300 grams of PCP, more than 150 grams of heroin, more than 100 grams of fentanyl, boxes of suboxone strips, and more than 100 grams of a cutting agents.
During the trial, officers and agents of the Prince George’s County Police Department, Metropolitan Washington Airports Authority, and the Maryland Office of the State Prosecutor, testified regarding separate arrests of coconspirators during the course of ATF’s investigation, which resulted in the seizure of narcotics, drug paraphernalia, and U.S. currency.
Tucker was previously prosecuted in the D.C. Superior Court and convicted of drug trafficking felony offenses on three separate occasions. In 2010, he was convicted of two counts of distributing PCP. In 1999 and 2000, he was convicted of possessing crack cocaine with an intent to distribute.
On June 13, 2019, Fields was sentenced to 16 years of incarceration to be followed by eight years of supervised release. Samuels has not yet been sentenced for his role in the drug trafficking conspiracy. Three other defendants – Darryl Smith, 41, of Washington, D.C., James Venable, 47, of Fort Washington, Md., and Lacy Hamilton, 42, of Suitland, Md. – pled guilty earlier to federal charges. Another defendant remains at large as a fugitive. Smith managed the barbershop and was sentenced to 80 months in prison relating to his possession of narcotics in the barbershop on February 1, 2018, and for his possession of packaged fentanyl and a loaded firearm following an arrest by MPD in December 2017 outside of the barbershop. Venable, another conspirator, was sentenced to a 37-month prison term following his possession of narcotics and a firearm in both Washington, D.C. during a December 2017 arrest by MPD and at his residence in Maryland on February 1, 2018. Venable also acknowledged selling narcotics to an ATF confidential informant in July 2017. Hamilton was sentenced to a 15-month prison term for selling narcotics outside the barbershop and in Maryland as part of the charged narcotics conspiracy.
In announcing the sentence, U.S. Attorney Liu, Special Agent in Charge Benedict, and Chief Newsham commended the assistance provided by officers and agents of the Prince George’s County Police Department, Metropolitan Washington Airports Authority, and the Maryland Office of the State Prosecutor. They also acknowledged the efforts of those who handled the case from the U.S. Attorney’s Office, including Assistant U.S. Attorneys Christopher Macchiaroli and Gregory Rosen of the Violent Crime and Narcotics Trafficking Section, and Paralegal Specialist Candace Battle.
Man from Fruitland, N.m., Pleads Guilty to Assault Resulting in Serious Bodily Injury in Indian CountryRead the Press Release
ALBUQUERQUE – Harry Jim, Jr., 36, of Fruitland, N.M., pleaded guilty in federal court yesterday to assault resulting in serious bodily injury in Indian Country.
In Jim’s plea agreement, he admitted driving while intoxicated and causing a vehicle collision within the Navajo Nation. The victim of the collision suffered a broken finger and leg.
Jim is currently in custody/out of custody awaiting sentencing. He faces up to 10 years in prison.
The Farmington office of the FBI investigated this case. Assistant U.S. Attorney Joseph M. Spindle is prosecuting the case.
Man from Chimayo, N.m., Pleads Guilty to Assault Resulting in Serious Bodily Injury in Indian CountryRead the Press Release
ALBUQUERQUE – Ricky Martinez, 27, of Chimayo, N.M., pleaded guilty in federal court on June 13, 2019, to assault resulting in serious bodily injury in Indian Country.
In Martinez’s plea agreement, he admitted committing this offense in Rio Arriba County on September 2, 2017. Martinez assaulted the victim by stabbing him with a knife in the face, neck, chest, and back causing extreme pain. The assault happened within the boundaries of Ohkay Owingeh Pueblo. The victim is an Indian. Martinez is not an Indian.
Martinez is currently in custody awaiting sentencing. He faces 41 to 51 months in prison.
The Santa Fe office of the FBI investigated this case with the Ohkay Owingeh Police Department. Assistant U.S. Attorney Allison C. Jaros is prosecuting the case.
Lexington Man and Semiconductor Company Indicted for Theft of Trade SecretsRead the Press Release
BOSTON – A Chinese born naturalized U.S. citizen living in Lexington, and a company he and his wife established, were charged in federal court in Boston in connection with stealing proprietary information from his former employer, Analog Devices, Inc. (ADI), a semiconductor company headquartered in Norwood. Yu is also charged with allegedly selling and illegally exporting integrated circuits that incorporated ADI’s stolen trade secrets.
Haoyang Yu, a/k/a “Jack Yu,” a/k/a “Harry Yu,” a/k/a “Jack Tricon,” 40, of Lexington, was arrested and charged along with his company, Tricon MMIC LLC, in an indictment unsealed today. Yu was indicted on four counts of theft of trade secrets; four counts of copying, uploading, downloading, and attempted copying, uploading, and downloading of a trade secret; four counts of possession and attempted possession of a trade secret; and three counts of smuggling. Tricon MMIC LLC was also indicted on three counts of smuggling. Yu will appear this afternoon in federal court in Boston.
“Theft of trade secrets from American companies is a pervasive economic and national security threat, which makes Massachusetts, a worldwide leader in technological research and innovation, a target,” said United States Attorney Andrew E. Lelling. “Yu is charged with a massive theft of proprietary trade secret information from his former employer for the purpose of setting up his own company and marketing their products as his own. Today’s charge should make it clear that combating the theft of trade secrets from American businesses is one of my office’s top priorities.”
“Today’s actions are the result of the seamless coordination and collaborative counter proliferation efforts by the Office of Export Enforcement, the Justice Department, Homeland Security Investigations, NCIS and the FBI,” said Acting Special Agent in Charge William Higgins of the Office of Export Enforcement. “The Boston Field Office, Office of Export Enforcement will continue to work with all its Law Enforcement partners to stem illicit trade that threatens U.S. national security and undermines U.S. foreign policy. We will continue to vigorously pursue violators wherever they may be.”
“Violations of U.S. export laws like the ones charged in this case are serious offenses that undermine national security through the illegal export of sensitive U.S. technology and compromise the economic viability of American companies,” said Peter C. Fitzhugh, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s (ICE), Homeland Security Investigations, Boston. “Today’s enforcement actions could not have occurred without the coordinated efforts of a very dedicated team of law enforcement partners that included members of HSI’s Counter-Proliferation Investigations Center, the agency’s specialized unit dedicated to preventing the illegal export of U.S. technology and protecting American businesses by combating transnational criminal networks and violators of our export laws.”
“As alleged, Mr. Yu stole trade secrets from his employer for his own financial gain,” said Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division. “We are deeply concerned about American innovation ending up in the wrong hands, and the FBI is committed to investigating rogue actors and foreign nations who steal our trade secrets, technology, and proprietary information for military or economic gain. While we all welcome fair competition, we cannot and will not tolerate stealing and cheating. It’s illegal, unethical, and unfair, and this type of conduct hurts American businesses, jobs, and consumers, and in many instances, jeopardizes our national security.”
NCIS Northeast Field Office Special Agent in Charge Leo S. Lamont stated: “NCIS works closely with our partners in the FBI, HSI, and Department of Commerce to aggressively combat the theft of trade secrets and the illegal export of sensitive defense technologies. These crimes not only weaken our national security but also jeopardize the safety of our brave men and women in uniform.”
According to the charging document, Yu was born in Harbin, China, and first came to the United States in 2002 through the student visa program. He became a lawful permanent resident in June 2009, and a naturalized U.S. citizen in March 2017. In July 2014, Yu started working at ADI as a principal design engineer.
As alleged in the indictment, Yu worked for ADI designing and developing parts of monolithic microwave integrated circuits (MMICs), which are used in radio, cellular, and satellite communications as well as defense and aerospace applications. As a result of his work, Yu had access to data and information relating to the present and future product designs, schematics, manufacturing files and testing procedures. It is alleged that, while working for ADI, Yu downloaded hundreds of highly confidential schematic design files and modeling files that belonged to ADI, and copied portions of those files into spreadsheets which he uploaded to his personal Google drive account. The files Yu allegedly stole from ADI were worth millions of dollars.
In March 2017, approximately five months before he resigned from ADI, Yu and his wife established Tricon MMIC LLC, which according to its website, “specializes in wide band MMIC amplifiers,” and serves customers in “defense and aerospace, test and instrumentation, [and] satellite communications.”
On July 31, 2017, Yu resigned from ADI and signed an agreement affirming that he had surrendered all proprietary information or data. Nevertheless, in December 2018, Yu allegedly had propriety ADI files in his possession. Furthermore, since creating Tricon in March 2017, Yu marketed and sold approximately 20 ADI designs as his own, and even used the same semiconductor fabrication plant as ADI. Yu used the Tricon website to target ADI customers, claiming that Tricon could better serve customers because ADI “has hit many customers by sudden announcements of obsolete parts.” For each purported obsolete part, Tricon listed a replacement part on its website. These replacement parts contained specifications identical to or substantially similar to ADI.
It is alleged that since leaving ADI, from August 2017 to June 2019, Yu has been working at a cleared defense contractor while simultaneously operating Tricon and selling parts that are identical to, or substantially similar, to ADI products and which incorporate ADI’s stolen trade secrets. Yu has also allegedly used Tricon to illegally export several parts to Spain by concealing both his name and the export control classification number of the parts being exported on the shipping documents.
ADI, the named victim of the Yu’s theft of trade secrets, has been cooperating with the government throughout this investigation.
The charge of stealing, copying, downloading, and possessing a trade secret provides for a sentence of no greater than 10 years in prison, three years of supervised release and a fine of $250,000. The charge of smuggling goods from the United States provides for a sentence of no greater than 10 years in prison, three years of supervised release and a fine of $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
U.S. Attorney Lelling; Acting DOC – Office of Export Enforcement SAC Higgins; HSI Boston SAC Fitzhugh; FBI Boston SAC Bonavolonta; and NCIS SAC Lamont made the announcement today. The following agencies also assisted in this investigation: Customs and Border Protection; Coast Guard Investigative Service; Defense Criminal Investigative Service; Massachusetts State Police; Lexington Police Department; and Hingham Police Department. Assistant U.S. Attorney B. Stephanie Siegmann, Chief of Lelling’s National Security Unit, and Assistant U.S. Attorney George Varghese, of Lelling’s National Security Unit, are prosecuting the case.
The details contained in the charging documents are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
UPDATE: In April 2022, Haoyang Yu was acquitted by a federal jury of 18 counts of the charges alleged in the indictment. He was convicted of one count of possessing a stolen trade secret.