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Wednesday 22 May 2019
Robert Morgan, Three Others Indicted in Multi-Million Dollar Mortgage Fraud SchemeRead 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 a federal grand jury has returned a 114-count superseding indictment charging Robert Morgan, Frank Giacobbe, Todd Morgan, and Michael Tremiti, with conspiracy to commit wire fraud and bank fraud for their roles in a half billion dollar mortgage fraud scheme. The defendants each face various additional charges such as wire and bank fraud, and money laundering. Todd Morgan and Robert Morgan are also charged with wire fraud conspiracy to defraud insurance companies. The charges carry a maximum penalty of 30 years in prison and a fine in the amount of double the loss caused by the crimes, which is currently estimated to exceed $25,000,000.
During the course of the conspiracy:
• Robert Morgan was the managing member and chief executive officer of Morgan Management. In addition to his role with Morgan Management, he controlled and managed owned a substantial portfolio of real estate holdings;
• Frank Giacobbe owned and operated Aurora Capital Advisors, identified himself as the Principal, and employed others to assist him in brokering, and attempting to broker real estate loans;
• Todd Morgan was employed at Morgan Management, and worked as a Project Manager at the company; and
• Michael Tremiti was employed at Morgan Management, and worked as Director of Finance for the company.Assistant U.S. Attorneys John D. Fabian and Douglas A.C. Penrose, who are handling the case, stated that according to the superseding indictment, between 2007 and June 2017, the defendants conspired with Kevin Morgan, Patrick Ogiony, Scott Cresswell, and others to fraudulently obtain moneys, funds, credits, assets, securities, and other property from financial institutions such as Arbor Commercial Mortgage, LLC and Berkadia Commercial Mortgage, LLC, and government sponsored enterprises, including Federal Home Loan Mortgage Corporation (Freddie Mac), and the Federal National Mortgage Association (Fannie Mae).
The defendants provided false information to financial institutions and government sponsored enterprises overstating the incomes of properties owned by Morgan Management or certain principals of Morgan Management. The false information induced financial institutions to issue loans: (1) for greater values than the financial institutions would have authorized had they been provided with truthful information; and (2) that the financial institutions would not have issued at the time of issuance had they been provided with truthful information. These properties included:
• The Preserve at Autumn Ridge, Watertown, NY;
• The Eden Square Apartments, Cranberry Township, Pennsylvania;
• The Rochester Village Apartments at Park Place, Cranberry Township, Pennsylvania;
• The Reserve at Southpointe, Canonsburg, Pennsylvania;
• 7100 South Shore Drive Apartments, Chicago, Illinois;
• The Avon Commons Apartments, Avon, NY;
• The Morgan Bay Apartments, Houston, Texas;
• Brookwood on the Green, Syracuse, NY;
• The Creek Hill Apartments, Rochester, NY;
• Hickory Hollow, Rochester, NY;
• The Knollwood Manor Apartments, Rochester, NY;
• The Links at Centerpointe, Canandaigua, NY;
• The Nineteen North Apartments, Pittsburgh, Pennsylvania;
• The Overlook at Golden Hills, Lexington, South Carolina;
• The Penbrooke Meadows Apartments, Rochester, NY;
• The Trails of North Hills Apartments, Raleigh, North Carolina;
• The Rivers Pointe Apartments, Syracuse, NY;
• The Union Square Apartments, Rochester, NY;
• The View at MacKenzi, York, Pennsylvania; and
• The Villas of Victor, Rochester, NY.To facilitate the conspiracy:
• Morgan Management provided property management, accounting, and financial reporting services for the properties owned by limited liability companies controlled by defendant Robert Morgan.
• The defendants conspired to manipulate income and expenses for properties to meet debt service coverage ratios (“DSCRs”) required by lending institutions. The manipulation included, among other things, removing expenses from information reported to lenders and keeping two sets of books for at least 70 properties, with one set of books containing true and accurate figures and a second set of books containing manipulated figures to be provided to lenders in connection with servicing and re-financing loans.
• The defendants conspired to present lending institutions with false and fraudulent inflated construction contracts and invoices that falsely reported to the lending institution that the contractor constructing a property was being paid more than the contractor was actually being paid.
• The defendants provided false information to financial institutions and government sponsored enterprises that overstated net incomes of properties and thereby induced financial institutions to: (1) issue loans (a) for greater values than financial institutions would have authorized had they been provided with truthful information; and (b) that the financial institutions would not have issued at the time of issuance had they been provided with truthful information; and (2) forgo contractual rights that would have inured to the financial institutions had the defendants and Morgan Management presented accurate financial information to the financial institutions.
• The defendants employed various mechanisms to mislead inspectors, appraisers, financial institutions and government sponsored enterprises with respect to the occupancy of properties.
• The defendants falsely inflated the amounts owed on properties, by among other things, (1) providing false documentation of obligations purportedly associated with the properties, (2) misrepresenting the actual purchase prices of properties by providing false contracts and contract prices, and (3), as set forth above, presenting false construction contracts and invoices.In the wire fraud conspiracy to defraud insurers, Todd Morgan and Robert Morgan are accused of conspiring with Kevin Morgan and Scott Cresswell to present false and inflated contracts and invoices for repairs to insurers after damages to properties in Robert Morgan’s real estate portfolio. These properties include the Summerwood Apartments in Merrillville, Indiana; the Eden Square Apartments in Cranberry Township, Pennsylvania; and at thirty-four properties in the Rochester, New York area after a March 2017 windstorm in that area.
The defendants are also charged with money laundering conspiracy for engaging in monetary transactions in excess of $10,000 using the proceeds of wire fraud and bank fraud.
The total loss sustained by financial institutions and government sponsored enterprises throughout the mortgage fraud scheme is currently estimated to exceed $25,000,000. The loss resulting from the insurance fraud scheme is currently estimated at approximately $3,000,000.
The defendants made an initial appearance before U.S. Magistrate Judge Michael J. Roemer and were released on conditions.
“The charges announced today reflect this Office’s commitment to ensuring that those who do business with the mortgage, banking, and insurance industries act with honesty and integrity,” stated U.S. Attorney Kennedy. “The scope of the dishonesty and deceit alleged here—both in a geographic sense as well as in terms of the dollar value of the mortgages and properties involved—was expansive. This type of fraud strikes at the very heart of those industries, and I commend the FBI and the FHFA-OIG for the significant resources they devoted to this investigation in order to reveal the full scope of the illegal conduct alleged in this superseding indictment.”
“Today's charges allege Robert Morgan-and the men he surrounded himself with in business-worked hard with a desire to creatively subvert the integrity of the financial industry," said FBI Buffalo Special Agent-in-Charge Gary Loeffert. “In response, we worked just as hard and creatively to put a stop to it. We hope the indictment returned in this case helps to educate and protect the tens of thousands of investors who own mortgage-backed securities.”
Richard Parker, Acting Deputy Inspector General for Investigations for the Federal Housing Finance Agency, Office of Inspector General (FHFA-OIG), said, “the financing of multifamily loans is a significant segment of Fannie Mae’s and Freddie Mac’s portfolio. As these charges demonstrate, FHFA-OIG will work with our partners in law enforcement to investigate and hold accountable those who seek to victimize the entities regulated by FHFA.”
Defendants Kevin Morgan and Patrick Ogiony were previously convicted of conspiracy to commit bank fraud, and defendant Scott Cresswell was previously convicted of conspiracy to commit wire fraud for their roles in the multi-million dollar fraud scheme. All three defendants are awaiting sentencing.
The superseding indictment is the result of an investigation by the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Gary Loeffert, and the Federal Housing Finance Agency, Office of Inspector
General, under the direction of Special Agent-in-Charge Robert Manchak, Northeast Region.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
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Raleigh Man’s Roadside Bathroom Break Leads to Four-Year Federal Firearms SentenceRead the Press Release
RALEIGH — The United States Attorney for the Eastern District of North Carolina, Robert J. Higdon, Jr., announced that today, Chief United States District Judge Terrence W. Boyle sentenced Clifton Eugene Battle, 35, of Raleigh to 48 months’ imprisonment, followed by 3 years of supervised release. Battle pled guilty to one count of possession of a firearm by a convicted felon on February 20, 2019.
The evidence established that on June 26, 2018, a deputy with the Wake County Sheriff’s Office was on patrol when he saw a car stationary in a travel lane of Poole Road in Raleigh. The deputy stopped to find BATTLE standing by the car with the driver’s door open. BATTLE, who had glassy eyes, smelled of alcohol, and was standing over a puddle, explained that he had stopped his car to urinate. The deputy walked around the car, and spotted a Taurus .38 special revolver sitting in plain view on the passenger seat. Deputies searched the car and also recovered a box of ammunition from the trunk.
In 2008, BATTLE was convicted of being a felon in possession of a firearm in a crime he used a revolver to shoot a man. He was on supervised release for that offense when this crime occurred.
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. Since 2017 the United States Department of Justice has reinvigorated the PSN program and has targeted 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.
That effort has been implemented through the Take Back North Carolina Initiative of The United States Attorney’s Office for the Eastern District of North Carolina. This initiative emphasizes the regional assignment of federal prosecutors to work with law enforcement and District Attorney’s Offices on a sustained basis in those communities to reduce the violent crime rate, drug trafficking, and crimes against law enforcement.
The investigation of this case was conducted by the Wake County Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF). Assistant United States Attorneys Jake D. Pugh represented the government.
Providence Kentucky Woman Pleads Guilty to Distributing & Receiving Child PornRead the Press Release
OWENSBORO, Ky. – A Providence, Kentucky, woman has pleaded guilty before United States District Judge Joseph McKinley Jr. for distributing and receiving child pornography, announced United States Attorney Russell M. Coleman.
According to the plea agreement on September 25, 2017, Lucia C. Jenkins, age 50, in Webster County, Kentucky, and elsewhere, knowingly distributed and received child pornography. A federal Grand Jury sitting in Owensboro indicted Jenkins on three charges on July 11, 2018.
Jenkins faces a statutory mandatory minimum term of imprisonment of 5 years and supervised release of at least 5 years and up to any number of years, including life. There is no parole in the federal system.
The case is being prosecuted by Assistant United States Attorney Seth Hancock, the chief of the Paducah, Kentucky branch office, and was investigated by Homeland Security Investigations and the Kentucky State Police.
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This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Portland Man Pleads Guilty to Production of Child PornographyRead the Press Release
PORTLAND, Ore.—Juan Carlos Ramon, 33, of Portland, pleaded guilty today to two counts of production of child pornography after sexually exploiting two minor victims, aged six and eight, using musical.ly, a social media application now known as TikTok.
According to court documents, on or about June 28, 2017, Ramon began communicating with two minors using the musical.ly app. He used the screen name “@lexithetiger” and pretended to be a minor female. Ramon encouraged his victims to play a “Simon Says” type game where he would send sexually explicit photos of a minor female and ask his victims to take and send him photos imitating the positions and acts depicted. The minor victims agreed and sent Ramon a series of progressively more explicit self-produced images. A relative of the two victims later discovered the communications and reported it to law enforcement.
Each count of production of child pornography carries a maximum sentence of 30 years in prison with a 15-year mandatory minimum, a $250,000 fine, a $5,000 special assessment and a life term of supervised release with a five-year mandatory minimum. Ramon will be sentenced on September 5, 2019 before U.S. District Court Judge Robert E. Jones.
As part of the plea agreement, Ramon has agreed to pay restitution to his victims identified by the government prior to sentencing and as ordered by the court.
This case was investigated by FBI Portland’s Child Exploitation Task Force (CETF) and is being prosecuted by Natalie Wight, Assistant U.S. Attorney for the District of Oregon.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
The FBI’s Child Exploitation Task Force (CETF) conducts sexual exploitation investigations – many of them undercover – in coordination with other federal, state, and local law enforcement agencies. The Portland FBI’s CETF consists of agents and task force officers from the Beaverton Police Department, Portland Police Bureau, Tigard Police Department, Hillsboro Police Department, and the Clackamas County Sheriff’s Office. The FBI’s CETF is committed to locating and arresting those who prey on children as well as recovering underage victims of sex trafficking and child exploitation.
Anyone who has information about the physical or online exploitation of children are encouraged to call the FBI at (503) 224-4181 or submit a tip online at www.fbi.gov/tips.
Pharmacist Headed to Federal Prison and Required to Pay $55,000 in Community Restitution for Illegally Distributing Oxycodone and AmphetamineRead the Press Release
DENVER -- A registered pharmacist, Mary Aronson, owner and operator of St. Vrain Pharmacy in Lyons, Colorado, was sentenced for illegal distribution of narcotics before Chief United States District Court Judge Philip Brimmer, announced United States Attorney Jason R. Dunn and DEA Denver Division Special Agent in Charge William T. McDemott. Aronson was sentenced to 6 months in prison, to be followed by 6 months of home detention and 5 years of supervised release. As part of yesterday’s sentence, Aronson is required to forfeit $20,000 and pay an additional $55,000 in community restitution.
The $55,000 community restitution payment is the first of its kind in the District of Colorado and one of the first in the country. By law, the payment will go to two separate victim funds administered by the Colorado Department of Public Safety, Division of Criminal Justice, including a fund designated to receive federal funds for substance abuse programs in the state.
According to court documents, including the plea agreement, on November 28, 2017, law enforcement agents spoke with a confidential informant who said that Aronson sold her OxyContin pills for over a year-and-a-half, and that she paid $1 per pill. On December 5, 2017, the confidential informant made a controlled purchase that was audio recorded by law enforcement. At that time, the confidential informant provided Aronson $50, who then gave her 20 pills of oxycodone (10 milligram) and 20 pills of amphetamine/dextroamphetamine (20 milligram) without a prescription. Law enforcement conducted two more controlled purchases from the defendant on January 19, 2018, and February 13, 2018. During the investigation, Aronson gave the confidential informant four blank prescription pages and showed her how to fill out a forged prescription. The defendant told the informant “don’t worry, the doctor is dead and will never find out.”
“Prescription opioid abuse continues to be an epidemic that is ravaging our state,” said United States Attorney Jason Dunn. “That’s why we not only seek prison terms for those who choose to violate the law, but we will now begin seeking restitution payments where appropriate to address the public harm being caused to communities.”
“The DEA will continue to investigate registrants who cause harm to the public and fuel the opioid epidemic,” said DEA Denver Division Special Agent in Charge William T. McDermott. “This case shows the opioid epidemic is being fought at all levels to include professionals in a position of trust.”
This matter was investigated by the Drug Enforcement Administration and the Boulder County Drug Task Force. It was prosecuted by Assistant United States Attorneys Suneeta Hazra, Garreth Winstead, and Tonya Andrews.
Case No: 18-cr-475
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Penn Yan Man Charged with Falsifying Inspection Reports for Space PartsRead 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 James Smalley, 41, of Penn Yan, NY, was arrested and charged by criminal complaint with falsifying inspection reports for space parts. The charge carries a maximum penalty of 10 years in prison and a $250,000 fine.
Assistant U.S. Attorney Richard A. Resnick, who is handling the case, stated that according to the complaint, the defendant was a Quality Assurance Engineer at PMI Industries, LLC, a Rochester aerospace precision machining service, specializing in high-tolerance machining for flight critical aerospace parts used to build space flight vehicles by SpaceX and other Department of Defense aerospace contractors. Smalley began his employment at PMI on March 6, 2017, working on contracts for SpaceX, which developed the Falcon launch vehicle family and the Dragon spacecraft family. Falcon and Dragon both currently deliver payloads into Earth orbit for NASA, the Air Force, other United States government agencies and private industry. SQA Services, Inc. (SQA) is a subcontractor to SpaceX, and provides multiple quality assurance functions within the aerospace and defense manufacturing industries.The complaint states that in January 2018, an internal audit by SQA Services, Inc. (SQA), at the direction of SpaceX, revealed multiple falsified source inspection reports and non-destructive testing (NDT) certifications from PMI Industries, LLC, for Falcon 9 and Falcon Heavy flight critical parts. SpaceX notified PMI of the anomalies. Source inspections and NDT are key tools used in the aerospace industry to ensure manufactured parts comply with quality and safety standards. Specifically, the signed source inspection report had a forged signature of the SQA inspector. SpaceX and SQA officials believed the signature of the inspector was photocopied and cut and pasted onto the source inspection report with a computer.
On February 16, 2018, the NASA Launch Services Program alerted the NASA Office of Inspector General (OIG), and Kennedy Space Center (KSC) Resident Agency, regarding the falsified source inspection reports and false NDT certifications created by PMI. Some of the false source inspection reports and false NDT certifications were related to space launch vehicle components that, at the time of discovery, were to be used for the upcoming Transiting Exoplanet Survey Satellite (TESS) mission, which launched from a SpaceX Falcon 9 rocket on April 18, 2018.
The investigation has identified that Smalley, while an employee of PMI, falsified at least 38 source inspection reports for space vehicle parts procured by SpaceX for the construction of the Falcon 9 and Falcon Heavy series of space vehicles. The investigation has also identified at least 76 individual piece parts that were rejected during source inspection or were never inspected by SQA, then subsequently shipped to SpaceX.
A records request from SpaceX identified seven NASA space flight missions, two United States Air Force space flight missions, and one National Oceanic and Atmospheric Administration (NOAA) space flight mission that were affected by parts purchased by SpaceX from PMI.
Subsequently, SpaceX terminated its business relationship with PMI averaged approximately $200,000 per month from the business with SpaceX, as a disqualified supplier. PMI subsequently closed its operation.
“The success of America’s reinvigorated space program depends not just on American ingenuity but on American integrity as well,” stated U.S. Attorney Kennedy. “These charges make clear that those who commit fraud against NASA, the Air Force, the National Oceanic and Atmospheric Administration, who are among the government agencies leading our space program, and those private companies, such as SpaceX, with whom the government partners and contracts in its effort, will be held accountable when they seek to cut corners. Such fraudulent conduct jeopardizes no only the success of the program but the lives of the brave men and women who rely on the integrity of not just the space vehicles themselves but all those who help to design and build them.”
“The NASA Office of Inspector General will continue to aggressively investigate those who undermine NASA operations and jeopardize U.S. space launch missions by their fraudulent actions,” said Special Agent-in-Charge John Corbett, Central Field Office.”
“The Air Force Office of Special Investigations (AFOSI), along with its law enforcement partners, has, and always will, aggressively identify, investigate, and neutralize anyone who attempts to commit aircraft and space vehicle part fraud and put our nation's warfighters at risk,” stated Special Agent-in-Charge Wendell W. Palmer, AFOSI, Office of Procurement Fraud.
“According to the criminal complaint, James Smalley took the act of forgery to a new level,” said FBI Buffalo Special Agent-in-Charge Gary Loeffert. “A potentially catastrophic level with the potential to not only cost millions of dollars, but also jeopardize years of irreplicable work.”
The defendant will make an initial appearance before U.S. Magistrate Judge Jonathan W. Feldman on May 23, 2019, at 1:00 p.m.
The complaint is the result of an investigation by the NASA Office of Inspector General, under the direction of Special Agent-in-Charge John Corbett, Central Field Office; the Air Force Office of Special Investigations, under the direction of Special Agent-in-Charge Wendell W. Palmer, Office of Procurement Fraud; and the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Gary Loeffert.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
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Okmulgee Man Pleads Guilty to Firearm Possession During Drug TraffickingRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Johnny Scott Sadler, age 48, of Okmulgee, Oklahoma entered a guilty plea to Possession Of A Firearm In Furtherance Of A Drug Trafficking Crime, in violation of Title 18, United States Code, Section 924(c)(1)(A), punishable by not less than 5 years imprisonment consecutive to any other conviction, a fine up to $250,000.00, or both.
The Indictment alleges that on or about February 23, 2019, within the Eastern District of Oklahoma, the defendant, did knowingly possess a firearm, to wit: One (1) Bushmaster Firearms Inc., Model BACR, Multi caliber semi-automatic rifle (.223 caliber barrel), serial number SRR00194, in furtherance of a drug trafficking crime for which he may be prosecuted in a court of the United States.
The charges arose from an investigation by the Okmulgee County Sheriff’s Office and the Federal Bureau of Investigation.
The Honorable Steven P. Shreder, U.S. Magistrate Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, accepted the plea and ordered the completion of a presentence investigation report.
Assistant United States Attorney Shannon Henson represented the United States.
Ohio County man admits to firearms chargeRead the Press Release
WHEELING, WEST VIRGINIA – Xavier C. Coyle, of Wheeling, West Virginia, has admitted to a firearms charge, United States Attorney Bill Powell announced.
Coyle, age 29, pled guilty today to one count of “Unlawful Possession of a Firearm.” Coyle, having previously been convicted of a felony, admitted to having 9mm pistol in December 2019 in Marshall County.
Coyle faces up to 10 years incarceration and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
This case was brought as part of Project Safe Neighborhoods (PSN). Project Safe Neighborhoods is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
Assistant U.S. Attorney Robert H. McWilliams, Jr. is prosecuting the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Marshall County Drug & Violent Crimes Task Force, a HIDTA-funded initiative, investigated.
Senior U.S. District Judge Frederick P. Stamp, Jr. presided.
Nurse Practitioner Sentenced to over Six Years in Prison for Unlawful Dispensing of Opioids and Health Care FraudRead the Press Release
LAS VEGAS, Nev. – A nurse practitioner was sentenced today to 78 months in federal prison followed by three years of supervised release and ordered to pay restitution in the amount of $3,749,121.29 for unlawfully dispensing prescription opioids and Medicare and Medicaid fraud, announced United States Attorney Nicholas A. Trutanich for the District of Nevada, Special Agent in Charge Aaron C. Rouse for the FBI’s Las Vegas Division, and Special Agent in Charge Christian J. Schrank for the Office of Inspector General of the U.S. Department of Health and Human Services, Los Angeles Region.
Alejandro “Alex” Incera, aka Alexander Jiminez-Incera, an Advance Practice Registered Nurse, 48, of Las Vegas, previously pleaded guilty to eight counts of distribution of controlled substance and eight counts of health care fraud. United States District Judge James Mahan presided over the sentencing hearing.
From January 2018 to about May 2018, Incera had an agreement with co-defendants Robert D. Harvey, a surgical technician, and Dr. Horace P. Guerra to distribute Hydrocodone and Oxycodone to patients without a legitimate medical purpose in exchange for cash payments. Incera wrote illegal opioid prescriptions on prescriptions with his name and DEA number for patients without a medical purpose.
Furthermore, between July 2016 to about December 2017, Incera defrauded Medicare and Medicaid by writing Lidocaine, Modafinil, and Diclofenac Sodium prescriptions to patients without a legitimate medical purpose and at times without having examined the patient at all. These prescriptions were filled and processed by Atlas Pharmacy who paid Incera approximately $30,000 in exchange for patient referrals. The Medicare and Medicaid programs were defrauded out of approximately $3.7 million.
Dr. Guerra was sentenced to 12 months in federal prison, Harvey was sentenced to six months in federal prison, and both face three years of supervised release following incarceration. Co-defendant Leslie Kalyn, aka Leslie Feth, a Doctor of Nursing, was also charged for her alleged role in the opioid distribution conspiracy. A jury trial is scheduled on September 23, 2019.
The case was investigated by the FBI, the Office of Inspector General of the U.S. Department of Health and Human Services, and the Nevada Attorney General’s Office Medicaid Fraud Control Unit. Assistant United States Attorney Nadia Ahmed and Assistant Chief Kilby MacFadden from the Department of Justice Fraud Section prosecuted the case.
The District of Nevada was selected as one of 12 districts nationally to participate in the Opioid Fraud and Abuse Detection Unit, a program that utilizes data to help combat the devastating opioid crisis. The District of Nevada has assigned prosecutors that focus on investigating and prosecuting health care fraud related to medical professionals who prescribe opioids, that unlawfully divert of dispense prescription opioids for illegitimate purposes.
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North Carolina Man Sentenced for Multiple Armed RobberiesRead the Press Release
RICHMOND, Va. – A North Carolina man was sentenced today to 18 years in prison for committing two armed bank robberies.
According to court documents, Allen E. Piner, Jr., 46, of Wallace, robbed the Argent Federal Credit Union and the Citizens Bank & Trust, both at gunpoint, on two separate occasions. On Sept. 1, 2017, Piner walked into the Citizens Bank & Trust, located in Chester brandishing a firearm and demanding money from two tellers working at the counter. In fear for their lives, the tellers gave Piner $5,000 before he fled the scene and got away.
On Oct. 11, 2017, Piner walked into the Argent Federal Credit Union, located in Midlothian, and pointed a firearm at the teller, demanding cash from her drawer. Fearing for her life, the teller complied with Piner’s demands, but unknown to Piner, the teller gave him currency with a GPS tracker. Local law enforcement tracked Piner within minutes, setting up a roadblock a short distance from the bank. After a short car chase, Piner fled his vehicle and scaled a fence while armed. When Piner turned toward the pursuing officers with his gun, a Chesterfield Police officer shot Piner one time to disable him, after which officers promptly rendered lifesaving first aid to him. The money, GPS tracker, and a firearm were all recovered at the scene.
This is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
This case was investigated by the FBI’s Richmond’s Central Virginia Violent Crimes Task Force.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and David W. Archey, Special Agent in Charge of the FBI’s Richmond Field Office, made the announcement after U.S. District Judge John A. Gibney Jr. accepted the plea. Assistant U.S. Attorneys Peter S. Duffey and David V. Harbach II are prosecuting the case.
The Chesterfield Police Department provided significant assistance during the investigation.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:18-cr-15.
New Jersey Man Charged with Attempting to Provide Material Support to Hamas, Making False StatementsRead the Press Release
A Somerset County, New Jersey, man was arrested today for attempting to provide material support to Hamas, lying on his application to enlist in the U.S. Army, and making threats against pro-Israel supporters. Assistant Attorney General for National Security John C. Demers, U.S. Attorney Craig Carpenito for the District of New Jersey, FBI Assistant Director for Counterterrorism Michael McGarrity and Special Agent in Charge Gregory W. Ehrie of the FBI’s Newark Field office made the announcement.
Jonathan Xie, 20, of Basking Ridge, New Jersey, was arrested this morning and is charged by complaint with two counts of attempting to provide material support to a designated terrorist organization, two counts of making false statements, and one count of transmitting a threat in interstate commerce. He is scheduled to appear this afternoon before U.S. Magistrate Judge Mark Falk in Newark federal court.
“According to the allegations in the complaint, Xie sent money intended for Hamas and tried to join our military hoping to learn skills that would help him commit violence in our country,” said Assistant Attorney General Demers. “Thanks to the agents, analysts, and prosecutors working on this investigation, Xie is now in custody and will be held accountable for his crimes.”
“Homegrown violent extremists like Xie are a serious threat to national security,” U.S. Attorney Carpenito said. “The actions that he took and planned to take made that threat both clear and present, and we commend our law enforcement partners for working closely with us to stop him before he could carry out his plans to commit violence on American soil. We will continue to do everything in our power to safeguard our country and its citizens from the threat of terrorism, whether that threat comes from abroad or – as here – from within.”
“The FBI is committed to stopping anyone who attempts to assist terrorist organizations or who threatens to commit acts of violence in our communities,” said Assistant Director McGarrity. “The threat from homegrown violent extremists who self-radicalize remains persistent. While more Americans may be familiar with ISIS, we take seriously those who wish to help any designated terrorist organization. I commend the hard work of the Newark Joint Terrorism Task Force on this case.”
“The FBI remains vigilant in its efforts to protect the public from those who support terrorist groups and ideologies,” Special Agent in Charge Ehrie said. “Thanks to the hard work and determination of our agents and their law enforcement partners on the Joint Terrorism Task Force, this defendant’s further support to terrorism was disrupted and a threat to the safety of our community was averted. This case also illustrates the value of public awareness and participation. When you report suspicious activity, you become a force multiplier in the mission to keep America safe.”
According to documents filed in this case and statements made in court:
In April 2019, Xie appeared in an Instagram Live video wearing a black ski mask, and stated that he was against Zionism and the neo-liberal establishment. When asked by another participant in the video if he would go to Gaza and join Hamas, Xie stated “yes, If I could find a way.” Later in the video, Xie displayed a Hamas flag and retrieved a handgun. He then stated “I’m gonna go to the [expletive] pro-Israel march and I’m going to shoot everybody.” In subsequent Instagram posts, Xie stated, “I want to shoot the pro-israel demonstrators . . . you can get a gun and shoot your way through or use a vehicle and ram people . . . all you need is a gun or vehicle to go on a rampage . . . I do not care if security forces come after me, they will have to put a bullet in my head to stop me.”
In December 2018, Xie sent $100 via Moneygram to an individual in Gaza who Xie believed to be a member of the Al-Qassam Brigades – a faction of Hamas that has conducted attacks, to include suicide bombings against civilian targets inside Israel. At approximately the same time that Xie sent the money, he posted on his Instagram account “Just donated $100 to Hamas. Pretty sure it was illegal but I don’t give a damn.” In April 2019, Xie sent a link to a website for the Al-Qassam Brigades to an FBI employee who was acting online in an undercover capacity. Xie described the website as a “Hamas” website and stated he had previously sent a donation to the group. Xie then sent screenshots of the website to the undercover employee and demonstrated how to use a new feature on the website that allows donations to be sent via Bitcoin. On or about April 26, 2019, Xie sent a donation of approximately $20 in Bitcoin (including transaction fees) via the website as a test to see whether the Bitcoin feature worked.
In February 2019, Xie stated that he wanted to join the U.S. Army “to learn how to kill… So I can use that knowledge.” He stated “Idk [I don’t know] if I pass the training…If I should do lone wolf. That is why I have to learn military techniques from the Army . . .” Consistent with his plan to join the U.S. Army, Xie completed a Security Clearance Application for National Security Positions in February 2019. He answered “no” to the question “Have you EVER associated with anyone involved in activities to further terrorism?” An error occurred in processing Xie’s application and Xie was required to complete the application a second time approximately ten days later. He again answered “no” to the question.
The investigation revealed additional social media accounts for Xie, including a YouTube account which contained, among other things, a playlist containing videos, many of which advocated or propagandized Soldiers for Allah, the war in Syria, Hezbollah (a foreign terrorist organization), and the Houthi movement in Yemen, as well as support for Bashar al Assad, Saddam Hussein, and North Korea. Around April 20, 2019, FBI surveillance observed Xie outside of the Trump Tower building in New York City. Shortly thereafter, according to Instagram records, Xie posted two photos to his Instagram account: One with the words “I want to bomb Trump Tower” imposed over the building image and the other with the words “[S]hould I bomb Trump Tower,” a “Yes/No” poll, and an emoji of a bomb imposed over the Trump Tower building image.
Xie also posted on Instagram his desire to blow up the Israeli Embassy in New York, and the need for “someone … to get a truck filled with explosives and blow up the Coachella event.”
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark; and the U.S. Department of Defense, Army Counterintelligence, 902d Military Intelligence Group, with the investigation leading to today’s arrest.
Each count of attempt to provide material support to a designated terrorist organization carries a maximum penalty of 20 years in prison and a $250,000 fine. Each count of making false statements carries a maximum penalty of five years in prison and a $250,000 fine. The count of transmitting a threat in interstate commerce carries a penalty of five years in prison and a $250,000 fine.
The government is represented by Assistant U.S. Attorney Joyce M. Malliet of the U.S. Attorney’s Office National Security Unit and Trial Attorney Bridget Behling of the U.S. Department of Justice’s Counterterrorism Section of the National Security Division.
The charges and allegations contained in the complaint are merely accusations and the defendant is presumed innocent unless and until proven guilty.
Mother and Two of Her Sons Among 11 Defendants Charged in Federal Drug and Gun Investigation in ChicagoRead the Press Release
CHICAGO — Eleven individuals, including a woman and two of her sons, are facing criminal charges as part of a federal drug and gun investigation in Chicago.
During the multi-year investigation, law enforcement seized 29 firearms and associated ammunition, a machete and sheath, approximately a kilogram of cocaine, 78 pounds of marijuana, more than $190,000 in suspected illicit cash proceeds, and diamond jewelry, Rolex watches and designer clothing appraised at more than $300,000. Much of the alleged drug trafficking occurred on the South Side of Chicago.
All eleven defendants were arrested last week. Detention hearings for many of the defendants are being held this week in U.S. District Court in Chicago.
The charges were announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Jeffrey S. Sallet, Special Agent-in-Charge of the Chicago office of the Federal Bureau of Investigation; and Eddie Johnson, Superintendent of the Chicago Police Department. Substantial assistance was provided by the Internal Revenue Service Criminal Investigation Division, Cook County Sheriff’s Department, Evergreen Park Police Department, Joliet Police Department, Orland Park Police Department, and Bolingbrook Police Department. Assistant U.S. Attorneys Ankur Srivastava and Sheri Wong represent the government.
According to charges filed in federal court, RAKIM ASAD, 26, of Chicago, and his mother, HARRIETTE MCPHERSON, 46, of Chicago, conspired with each other and DERRICK MCNEAL, 46, of Chicago, to possess cocaine and marijuana with the intent to deliver. Asad is also charged with knowingly possessing a loaded handgun in furtherance of a drug trafficking crime.
During the investigation, law enforcement seized from Asad a Rolex watch and two necklaces, according to the indictment against him. Attached to the necklaces were 14-carat gold pendants with the initials “LAFA” written in diamonds, the indictment states. The initials are an apparent reference to Asad’s suspected affiliation with LAFA, a Chicago street gang.
Four of the defendants are charged with conspiring to rob a drug dealer of marijuana in Chicago and Bridgeview in the summer of 2017. The charges allege that KELVIN EVERETT, 38, of Chicago, GREGORY BLACKWELL, 29, of Chicago, QUINCY WRIGHT, 37, of Chicago, and JERRY PEOPLES, 42, of Chicago, possessed a loaded rifle and handgun during an attempted robbery of the dealer on June 13, 2017, in Bridgeview. Everett, Blackwell, Wright and Peoples are also charged with illegal possession of the rifle and handgun, due to having prior felony convictions that prohibited them from lawfully possessing a firearm.
The charges further allege that RACHAD LUCAS, 38, of Calumet City, stored controlled substances in a storage unit in Calumet City. Lucas is also charged with possessing marijuana with the intent to distribute, knowingly possessing a handgun in furtherance of a drug trafficking crime, and illegally possessing the handgun as a previously convicted felon.
Three other defendants face various drug charges: RACHAD UNDERWOOD, 42, of Chicago, CALVIN WOODS, 28, of Chicago, and SINCERE BRANNON, 19, of Chicago. Brannon, who is also McPherson’s son, faces an additional charge of knowingly possessing a firearm in furtherance of a drug trafficking crime.
The public is reminded that charges contain only accusations and are not evidence of guilt. The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. The charges carry maximum penalties ranging from 20 years to life in prison. If convicted, the Court must impose reasonable sentences under federal sentencing statutes and the advisory U.S. Sentencing Guidelines.
Middletown, New Jersey, Investment Manager and Former Fire Chief Sentenced to 15 Years in Prison for Running Ponzi Scheme to Steal More Than $10 MillionRead the Press Release
NEWARK, N.J. – An investment manager with an office in Middletown, New Jersey, was sentenced today to 180 months in prison for running a Ponzi scheme, concealing losses, faking investment returns, and stealing more than $10 million in investor money, U.S Attorney Craig Carpenito announced today.
Vincent P. Falci, 59, of Middletown, was convicted Dec. 13, 2018, of all four counts of a superseding indictment: three counts of wire fraud and one count of securities fraud following a two-week trial before U.S. District Judge Anne E. Thompson, who imposed the sentence today in Trenton federal court.
According to the superseding indictment and evidence at trial:
Falci controlled a number of investment funds under the names “Saber Funds” and “Vicor Tax Receivables LLP.” The Saber Funds were a collection of investment funds that Falci created and operated, starting in the early 2000s. Many of his earliest victims were friends, family, and associates. Falci served as a fire chief in Middletown, and many early victims were policemen, fireman, and retirement funds for first responders. The Saber Funds grew to have more than 200 investors from whom the defendant raised more than $10 million.
Falci falsely told investors that the Saber Funds were conservatively invested in tax liens – which generated high returns with little risk. In reality, Falci diverted investor money to himself, his family, and to other companies he controlled. Some of the diverted funds were used for riskier ventures, such as day trading and real estate. Falci concealed losses and his own theft from investors. Based on these misrepresentations, investors continued to entrust additional funds to Falci and left previous investments under his control.
In early 2012, Falci started the Vicor Fund, targeting wealthier investors with greater sophistication in financial affairs. The investors in the Vicor Fund included financial industry professionals, and Falci ultimately raised $20 million from these victims. He again falsely represented that he had experience and a track record of success investing in tax liens, and promised that he could produce high rates of return with little risk. In reality, the assets of the Vicor Fund were rapidly depleted by Falci’s theft.
In order to support his own lifestyle and repay investors the gains he had promised, Falci stole more than $10 million from the Vicor Fund between 2012 and 2016. At the same time, he reported fake investment gains to his investors on every monthly statement. Falci concealed his theft in several ways, including by diverting funds to a fake company that he created to steal from investors. He also forged emails and reports, and created fake assets for the fund.
In addition to the prison term, Judge Thompson sentenced Falci to three years of supervised release, with restitution and forfeiture to be determined at a later date.
U.S. Attorney Carpenito credited inspectors of U.S. Postal Inspection Service, under the direction of Inspector in Charge James V. Buthorn, with the investigation leading to today’s verdict. He also thanked the N.J. Bureau of Securities in the State Attorney General’s Office, under the direction of Attorney General Gurbir Grewal and Bureau Chief Christopher Gerrold, for its assistance in the investigation.
The government is represented by Assistant U.S. Attorney Justin Herring, Chief of the Cybercrimes Unit of the U.S. Attorney’s Office in Newark.
Middlesex County Man Admits Participation in Conspiracy to Illegally Export Firearms and Other Items to UkraineRead the Press Release
NEWARK, N.J. – An Edison, New Jersey, man today admitted that he conspired to export, without a license, firearms and other items subject to the export control list, U.S. Attorney Craig Carpenito announced.
Gene Shilman, 62, a native of the Soviet Union, pleaded guilty before U.S. District Court Judge Katharine S. Hayden in Newark federal court to an information charging him with one count of conspiracy to violate the Arms Export Control Act, the International Emergency Economic Powers Act, and the Export Control Reform Act.
According to documents filed in this case and statements made in court:
From May 2014 through October 2018, Shilman entered into a conspiracy that included a conspirator living in Ukraine. Shilman exported defense articles regulated by the Arms Export Control Act. He exported to Ukraine items that are on the commerce control list as well as items with both defense and civilian uses that are subject to the Export Control Reform Act. Shilman never obtained the required export license from the U.S. Department of Commerce.
Shilman ordered and received firearm components and parts, ammunition, night-vision goggles and bulletproof vests from various vendors and firearms dealers in the United States. He received numerous wire transfers from overseas locations to pay for the purchase of these items. Shilman repackaged and shipped these munitions to overseas locations without the required export licenses.
In September 2018, Shilman completed a Customs Declaration form at a U.S. Post Office in Middlesex County, New Jersey, on which he falsely represented that the contents of the parcel destined for Ukraine contained tools and cartridges. An inspection of the parcel revealed that it actually contained multiple upper receivers, ammunition magazines and threaded barrels for handguns and a set of front and rear sights for a handgun.
The conspiracy count with which Shilman is charged carries a maximum potential sentence of five years in prison.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark; and the U.S. Department of Commerce, under the direction of Special Agent in Charge Jonathan Carson, with the investigation leading to the arrests.
The government is represented by Assistant U.S. Attorney and Thomas S. Kearney of the U.S. Attorney’s Office National Security Unit in Newark.
Mexican National Pleads Guilty to Methamphetamine DistributionRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Raul Alexis Gamez-Garcia, age 26, of Hermosillo, Senora, Mexico, entered a guilty plea to Possession With Intent To Distribute Methamphetamine, in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(A) and Title 18, United States Code, Section 2, punishable by not less than 10 years and not more than life imprisonment, a fine up to $10,000,000.00, or both.
The Indictment alleges that on or about January 7, 2019, within the Eastern District of Oklahoma, the defendant did knowingly and intentionally possess with intent to distribute 50 grams or more of methamphetamine (actual), a Schedule II controlled substance.
The charges arose from an investigation by the Oklahoma Highway Patrol and the Drug Enforcement Administration.
The Honorable Steven P. Shreder, U.S. Magistrate Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, accepted the plea and ordered the completion of a presentence investigation report.
Assistant United States Attorney Shannon Henson represented the United States.
Massillon man indicted on one count of enticementRead the Press Release
A Massillon man was indicted on one count of enticement.
Nathan Benedum II, 53, knowingly attempted to persuade, induce, entice and coerce an individual who he believed to be a 13-year-old girl to engage in illegal sexual activity with him in April 2019, according to the indictment.
If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant's role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case is being prosecuted by Assistant U.S. Attorney Michael A. Sullivan following an investigation by the Federal Bureau of Investigation and the Canton Police Department.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Marion, Kentucky Man Pleads Guilty to Distributing & Receiving Child PornRead the Press Release
OWENSBORO, Ky. – A Marion, Kentucky, man has pleaded guilty before United States District Judge Joseph McKinley Jr. for distributing and receiving child pornography, announced United States Attorney Russell M. Coleman.
According to the plea agreement, on September 25, 2017, Edward L. Walton, age 31, in Webster County, Kentucky, and elsewhere, knowingly distributed and received child pornography. A federal Grand Jury sitting in Owensboro indicted Walton on the two charges on June 13, 2018.
Walton faces a statutory mandatory minimum term of imprisonment of 5 years and supervised release of at least 5 years and up to any number of years, including life.
The case is being prosecuted by Assistant United States Attorney Seth Hancock, the chief of the Paducah, Kentucky branch office, and was investigated by Homeland Security Investigations and the Kentucky State Police.
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This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Man from Tohatchi, N.m., Sentenced to 240 Months in Prison for Kidnapping and Sexual Assault in Indian CountryRead the Press Release
ALBUQUERQUE – Ryan Thompson, 32, of Tohatchi, N.M. was sentenced in federal court yesterday to 240 months in prison for kidnapping and sexually assaulting his former girlfriend within the boundaries of the Navajo Nation.
Thompson previously entered a guilty plea to these charges on February 5, 2019. According to court documents, Thompson kidnapped the victim and her child at a gas station in Gallup, N.M. on November 15, 2017. Thompson then drove them to a remote location where he brutally beat and sexually assaulted the victim throughout the night. Thompson confined the victim and her child for a total of two days before she finally escaped and alerted law enforcement.
The FBI investigated the case. Assistant U.S. Attorney Joseph M. Spindle prosecuted the case.
Man from Shiprock, N.m., Pleads Guilty to Assault in Indian Country Resulting in Serious Bodily InjuryRead the Press Release
ALBUQUERQUE – Ryan Franklin, 30, of Shiprock, N.M., pleaded guilty in federal court on Monday to a charge of assaulting a woman in Indian Country resulting in serious bodily injury.
According Franklin’s plea agreement, he committed the offense on August 25, 2018, within the boundaries of the Navajo Nation in San Juan County, N.M. Franklin admitted he hit the victim in the face several times with his fists. The victim suffered extreme pain, a fractured orbital socket, and disfigurement that still requires medical attention. Franklin is an enrolled member of the Navajo Nation.
Franklin is currently in custody awaiting sentencing. He faces up to 10 years in prison.
The FBI investigated the case with the Bureau of Indian Affairs and the Navajo Police Department. Assistant U.S. Attorney Elisa C. Dimas is prosecuting the case.
Man from Farmington Sentenced to 30 Months in Federal Prison for Assault in Indian CountryRead the Press Release
ALBUQUERQUE – Twaine M. Willie, 28, of Farmington, N.M. was sentenced in federal court on Monday to 30 months in prison for assault causing serious bodily injury.
Willie previously entered a guilty plea to this offense on May 8, 2018. In his plea agreement, Willie admitted assaulting the victim within the Jicarilla Apache Nation on January 3, 2018. Willie pushed and beat the victim causing serious bodily injury, including a compound fracture to the victim’s leg. The victim suffered extreme pain and needed surgery to repair his broken bones. Willie is an enrolled member of the Navajo Nation.
The Farmington office of the FBI investigated this case with the Jicarilla Apache Police Department. Assistant U.S. Attorney Novaline D. Wilson prosecuted the case.
Ludlow Woman Pleads Guilty to Bank FraudRead the Press Release
BOSTON - A Ludlow woman pleaded guilty yesterday in federal court in Springfield to bank fraud.
Beth Zastawny, 53, pleaded guilty to one count of bank fraud and three counts of money laundering. U.S. District Court Judge Mark G. Mastroianni scheduled sentencing for Oct. 1, 2019.
Zastawny committed bank fraud in connection with a $4.2 million loan package for her Chicopee based company, Diecast Connections Company Inc. In January 2015, Blue Hills Bank, relying upon Zastawny’s false representations, extended the loans. Zastawny submitted fake financial statements to the bank, and she made false representations about Diecast's assets and liabilities to make it appear that Diecast's financial condition was much stronger than it was. After obtaining the loan proceeds, Zastawny paid back creditors who had not been disclosed to the bank, and the funds were used for purposes not called for in the loan agreement between Diecast and Blue Hills Bank. In July 2016, Blue Hills Bank foreclosed on the loan after Zastawny failed to meet the terms of the loan agreement, which resulted in a substantial loss for the bank.
Bank fraud provides for a sentence of no greater than 30 years in prison, five years of supervised release, and a fine of $1 million. Each money laundering count provides for a sentence of no greater than 10 years in prison, three years of supervised release, and a fine of $250,000, or twice the gross gain or loss, whichever is greater. 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 Kristina O’Connell, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston, made the announcement. Assistant U.S. Attorney Alex J. Grant of Lelling’s Springfield Branch Office is prosecuting the case.
Local Man Heads to Prison Following his Conviction on Child Pornography ChargesRead the Press Release
BROWNSVILLE, Texas – A 22-year-old Harlingen man has been ordered to federal prison following his conviction of possessing child pornography, announced U.S. Attorney Ryan K. Patrick.
Skylar Tarr McElwrath pleaded guilty Feb. 21, 2018.
Today, U.S. District Judge Rolando Olvera Jr. ordered him to serve 72 months in federal prison. McElwrath was further ordered to pay $3,600 in restitution to a known victim and will serve 12 years on supervised release following completion of his prison term, during which time he will have to comply with numerous requirements designed to restrict his access to children and the internet. He will also be ordered to register as a sex offender.
On or about July 20, 2017, authorities initiated an investigation of child pornography sharing which led them to the McElwrath’ s address in Harlingen. They later executed a search warrant at that location and seized a computer and other digital devices belonging to him.
A forensic analysis later revealed approximately 80 images and 15 videos of child pornography.
McElwrath was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.
Immigration and Customs Enforcement’s Homeland Security Investigations - Rio Grande Valley Child Exploitation Task Force conducted the investigation which was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to locate, apprehend and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."
Assistant U.S. Attorneys Jason Corley and Ana C. Cano are prosecuting the case.
Leader of Wilmington Area Drug Trafficking Organization Gets 16 Years in PrisonRead the Press Release
RALEIGH – The United States Attorney for the Eastern District of North Carolina, Robert J. Higdon, Jr., announces that United States District Judge James C. Dever, III sentenced RICHARD STINSON, 37, of Wilmington to 192 months of imprisonment followed by 5 years of supervised release. On July 23, 2018, STINSON pled guilty to conspiracy to distribute and possess with the intent to distribute 100 grams or more of heroin, possession with intent to distribute a quantity of heroin and possession of a firearm in furtherance of a drug trafficking offense.
According to the investigation, this drug trafficking organization was importing heroin from New York to a “stash house” on Northern Boulevard in Wilmington. STINSON was in charge of this “stash house” where he had people bagging up heroin which was then sold in Wilmington. STINSON was on parole out of New York for Manslaughter and had picked up some of the heroin while on a trip to meet his parole officer.
On April 1, 2016, the Wilmington Police Department Narcotics Unit served a search warrant on the residence on Northern Boulevard. STINSON and a female were found in the bathroom of the main house. STINSON was next to a loaded stolen .45 caliber handgun. In STINSON’S bedroom law enforcement found a key to a safe and 2 handguns. In the kitchen officers discovered approximately 1000 empty bags ready to be filled with heroin. In a safe in an apartment in the rear of the property, law enforcement found more than 30 grams of raw heroin, 867 bindles of packaged heroin and more than $1,500. STINSON was held accountable for more than 280 grams of heroin during the time of the conspiracy.
This case is part of the Take Back North Carolina Initiative of The United States Attorney’s Office for the Eastern District of North Carolina. This initiative emphasizes the regional assignment of federal prosecutors to work with law enforcement and District Attorney’s Offices on a sustained basis in those communities to reduce the violent crime rate, drug trafficking, and crimes against law enforcement.
The investigation of this case was conducted by the Federal Bureau of Investigation’s Safe Streets Task Force and the Wilmington Police Department Narcotics Unit. Assistant United States Attorney Timothy M. Severo handled the prosecution of this case for the government.
Lawrence Man Sentenced to 120 Months for Participating in Fentanyl Trafficking ConspiracyRead the Press Release
CONCORD – United States Attorney Scott W. Murray announced that Robert Raniery Arias, 35, a citizen of the Dominican Republic who most recently resided in Lawrence, Massachusetts, was sentenced on Tuesday to serve 120 months in prison for participating in a conspiracy to distribute over 400 grams of fentanyl.
Court filings and statements made in court established that Arias sold drugs to an undercover police officer on two occasions. On September 8, 2016, Arias was arrested as he attempted to deliver approximately 500 grams of fentanyl to the undercover officer at the Rockingham Mall in Salem, New Hampshire.
Arias previously pleaded guilty on January 31, 2019. Arias, who was not lawfully in the United States, faces likely deportation to the Dominican Republic after serving his prison sentence. Co-conspirator Carmen Jose was sentenced to 42 months in prison on February 2, 2018.
“The 10 year sentence imposed in this case serves as a warning to fentanyl traffickers,” said U.S. Attorney Murray. “Those who choose to bring this deadly drug into the Granite State should be aware that they face very substantial federal prison terms. Law enforcement agencies are working twenty-four hours a day to identify, prosecute, and incarcerate those who distribute fentanyl and other opioids in New Hampshire.”
“New Hampshire is in the midst of a devastating opioid crisis, as deaths from fentanyl climb,” said DEA Special Agent in Charge Brian D. Boyle. “The DEA will continue to use every resource available to identify those like Mr. Arias, who are coming from out of state to contribute to this crisis. DEA’s top priority is combatting the opioid epidemic by working with our local, county, state and federal law enforcement partners to bring to justice anyone who distributes this deadly drug.”
The case was investigated by the Drug Enforcement Administration, the Salem Police Department, and the Nashua Police Department and was prosecuted by Assistant United States Attorneys Georgiana L. Konesky and Seth R. Aframe.
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Justice Department Recognizes California Task Force for Investigating Child Sexual Predator and Child PornographerRead the Press Release
The Department of Justice today honored Detective Christie Hirota and five other members of the Sacramento Valley, California, High Tech Crimes Task Force for their investigation that resulted in the timely arrest of a sexual predator who victimized at least five children and who had a foster child in his care at the time of his arrest.
Principal Associate Deputy Attorney General Ed O’Callaghan, Office of Justice Programs Principal Deputy Assistant Attorney General Matt Dummermuth, and Office of Juvenile Justice and Delinquency Prevention Administrator Caren Harp presented Hirota and other task force members with the Missing Children’s Child Protection Award during the Justice Department’s National Missing Children’s Day ceremony. The award recognizes the extraordinary efforts of law enforcement officers who make a significant investigative or program contribution to protect children from abuse or victimization.
Other task force members recognized included:
- Detective James Williams, Sacramento County Sheriff’s Department
- Detective Melinda Gobron, Sacramento County Sheriff’s Department
- Special Agent Scott Schofield, FBI, Sacramento Field Office
- Investigator George Vasiliou, California Highway Patrol
- Detective Avis Beery, Sacramento Police Department
“The vigilance of this task force proves that there is a critical need for dedicated and timely investigative work in the fight to stop child exploitation,” said Administrator Caren Harp. “The Justice Department commends the Sacramento Valley High Tech Crimes Task Force for bringing this sex offender to justice and their commitment to stopping further child victimization.”
Hirota led a task force investigation into the suspect immediately after patrol officers received a Secure Digital (SD) memory card containing imagery of a partially-clothed boy from an acquaintance of the suspect. Through police and social service reports, Detective Hirota discovered that the suspect had a history of troubling behavior with boys, and that he currently had a foster child in his home. Just after midnight, Detective Hirota received a search warrant, which led to the seizure and subsequent review of multiple digital storage devices containing pornographic images of the suspect’s foster children. Within 48 hours of the initial patrol officers’ report, the task force’s investigation led to the suspect’s arrest on the charge of molesting four children.
The Department also recognized 11 other law enforcement officers for their investigations of child predators who sexually assaulted children, or created or viewed child pornography, as well as two firefighters who found a lost six-year-old boy. Harp also recognized Madison Dozier, a fifth grader at Reiley Elementary School in Alexandria, Kentucky, as the 20th winner of the National Missing Children’s Day poster contest.
Additional information about National Missing Children’s Day is available online.
The Office of Justice Programs, directed by Principal Deputy Assistant Attorney General Matt M. Dummermuth, provides federal leadership, grants and resources to improve the nation’s capacity to prevent and reduce crime, assist victims and enhance the rule of law by strengthening the criminal justice system. More information about OJP and its components can be found at www.ojp.gov.
Justice Department Observes National Missing Children’s DayRead the Press Release
The Department of Justice today recognized 17 law enforcement officers from California, Florida, and Texas, as well as two firefighters from Tennessee, for their efforts to find missing children and bring child sexual predators and child pornographers to justice.
Principal Associate Deputy Attorney General Ed O’Callaghan, Office of Justice Programs (OJP) Principal Deputy Assistant Attorney General Matt Dummermuth, and Office of Juvenile Justice and Delinquency Prevention (OJJDP) Administrator Caren Harp presented the awards during the Department’s National Missing Children’s Day ceremony.
“Those recognized today epitomize the dedication of law enforcement officers, investigative officials, and private citizens who make a difference in the lives of children every day,” said Principal Associate Deputy Attorney General Ed O’Callaghan. “Their vigilant and selfless actions remind us of our responsibility to protect children and bring to justice those who attempt to exploit them. The Department of Justice is proud to honor these champions of justice and public safety.”
The ceremony, hosted by OJJDP, included recognition of Madison Dozier, a fifth grader at Reiley Elementary School in Alexandria, Kentucky, this year’s National Missing Children’s Day poster contest winner.
The following awards were presented:
Attorney General’s Special Commendation: This commendation recognizes the extraordinary efforts and significant investigative or program contributions of an Internet Crimes Against Children task force or affiliate agency, or an individual assigned to either.
Recipient: Detective Lorraine Szczepanik of the Broward County Sheriff’s Office and South Florida Internet Crimes Against Children Task Force in Fort Lauderdale, Florida, whose timely investigation into a person suspected of viewing and sharing child pornography online led to the discovery of thousands of images and videos of child victims, as well as online conversations that led to the identification of three additional child pornographers.
Missing Children’s Law Enforcement Award: This award recognizes the extraordinary efforts of law enforcement officers who made a significant investigative or program contribution to the safety of children.
Recipients: Six members of the Round Rock, Texas, Police Department; three special agents from the San Antonio FBI Field Office (Austin and Laredo Resident Agencies); and a Texas Ranger from Austin collaboratively investigated and tracked down a suspect who kidnapped two missing sisters, ages 7 and 14, from their home in Round Rock. The sisters were found unharmed 700 miles away when the suspect was pulled over following issuance of an AMBER Alert and other alerts in Texas, New Mexico, and Colorado.
Missing Children’s Child Protection Award: This award honors the extraordinary efforts of law enforcement officers who made a significant investigative or program contribution on behalf of missing, abused, or victimized children.
Recipients: Detective Christie Hirota and five other members of the Sacramento Valley, California, High Tech Crimes Task Force led an investigation that resulted in the arrest, just 48 hours after receipt of the initial report, of a foster parent who abused his foster children and produced child pornography.
Missing Children’s Citizen Award: This award honors the extraordinary efforts of private citizens for their unselfish acts to recover missing or abducted children safely.
Recipients: Firefighters Aaron Woods and Michael Webb of the Blount County, Tennessee, Fire Department led a seven-hour portion of a 22-hour search across 2,000 acres of rugged, wooded terrain—on foot and by air—to find a six-year-old boy and his dog less than 24 hours after they were reported missing.
Other speakers at the ceremony included John F. Clark, president and chief executive officer of the National Center for Missing & Exploited Children, and Yvonne Ambrose, founder of the Desiree Foundation Against Sex Trafficking.
President Ronald Reagan proclaimed May 25, 1983, the first National Missing Children’s Day in memory of Etan Patz, a six-year-old boy who disappeared from a New York City street corner on May 25, 1979. Missing Children’s Day honors his memory and the memories of children still missing. Although Etan’s killer was convicted in February 2017 for the 1979 murder, Etan’s case remains active with the National Center for Missing & Exploited Children because his body was never found.
In 2018, there were 424,066 missing children entries in the FBI’s National Crime Information Center. Additional information about National Missing Children’s Day is available online.
The Office of Justice Programs, directed by Principal Deputy Assistant Attorney General Matt M. Dummermuth, provides federal leadership, grants and resources to improve the nation’s capacity to prevent and reduce crime, assist victims and enhance the rule of law by strengthening the criminal justice system. More information about OJP and its components can be found at www.ojp.gov.
Justice Department Honors Texas Officers with Missing Children’s Law Enforcement AwardRead the Press Release
The Department of Justice today honored 10 Texas-based law enforcement officers who rescued two sisters abducted from their home in Round Rock, Texas.
Principal Associate Deputy Attorney General Ed O’Callaghan, Office of Justice Programs Principal Deputy Assistant Attorney General Matt Dummermuth, and Office of Juvenile Justice and Delinquency Prevention Administrator Caren Harp presented the officers with the 2019 Missing Children’s Law Enforcement Award during the Justice Department’s National Missing Children’s Day ceremony. This award recognizes the extraordinary efforts of law enforcement officers who have made a significant investigative or program contribution to the safety of children.
On New Year’s Eve 2017, officers responded to a homicide scene in Round Rock, Texas. A woman had been murdered, and her 7- and 14-year-old daughters were missing. After an AMBER Alert was issued, credible sightings of the girls were also reported in northern New Mexico and southern Colorado, which led officials to issue alerts in all three states.
Through a combination of digital evidence, forensic processing, cell phone analysis, interviews, surveillance images and tips from the public, investigators discovered the suspect’s location. On Jan. 3, 2018, the sisters were found unharmed when the suspect was apprehended during a traffic stop near La Veta, Colorado—700 miles away from their home. The suspect had a long criminal history, including charges of attempted murder, rape, and child pornography. He was arrested and extradited to Texas, where he was subsequently convicted on two federal counts of kidnapping, one count of transportation of a minor with intent to engage in criminal sexual activity and one count of travel with intent to engage in illicit sexual conduct. He was sentenced May 21, in Austin, Texas, to life in federal prison.
Award recipients include officers from Round Rock, Austin, and Laredo, Texas.
Officers from the Round Rock Police Department:
- Sergeant Darin Bayles
- Detective Bernardo Villegas
- Lieutenant Robert Drawbaugh
- Crime Scene Specialist Kerie McKown
- Detective Robert Watts (Retired)
- Detective Kevin Bender
Officers from the FBI San Antonio Field Office, Austin Resident Agency:
- Special Agent Sean M. Mullen
- Special Agent Jacob E. Baillie
Officer from the FBI San Antonio Field Office, Laredo Resident Agency (now with the FBI’s Honolulu Field Office):
- Special Agent Andrew Masters
Officer from the Texas Ranger Division, Texas Department of Public Safety, Austin:
- Ranger Gary Phillips
“This collaborative team of law enforcement officers from multiple cities and states worked around the clock during this four-day manhunt,” said Administrator Caren Harp. “The Department of Justice praises their swift efforts in rescuing these children and bringing this individual to justice.”
The Department also recognized seven other law enforcement officers for their investigations of child sexual predators who sexually assaulted children, or created or viewed child pornography, as well as two firefighters who found a lost six-year-old boy. Harp also recognized Madison Dozier, a fifth grader at Reiley Elementary School in Alexandria, Kentucky, as the 20th winner of the National Missing Children’s Day poster contest.
Additional information about National Missing Children’s Day is available online.
The Office of Justice Programs, directed by Principal Deputy Assistant Attorney General Matt M. Dummermuth, provides federal leadership, grants and resources to improve the nation’s capacity to prevent and reduce crime, assist victims and enhance the rule of law by strengthening the criminal justice system. More information about OJP and its components can be found at www.ojp.gov.
Justice Department Honors Tennessee Firefighters for Rescuing Lost Boy and His DogRead the Press Release
The Department of Justice today recognized two Tennessee-based firefighters who led a seven-hour search that led to the discovery of a missing six-year-old boy and his dog.
Principal Associate Deputy Attorney General Ed O’Callaghan, Office of Justice Programs Principal Deputy Assistant Attorney General Matt Dummermuth, and Office of Juvenile Justice and Delinquency Prevention Administrator Caren Harp presented the Missing Children’s Citizen Award to Firefighters Aaron Woods and Michael Webb of the Blount County Fire Department in Maryville, Tennessee, during the Department’s National Missing Children’s Day ceremony. This award recognizes private citizens for extraordinary acts that lead to the safe recovery of missing or abducted children.
“The exhaustive search led by Mr. Woods and Mr. Webb as part of a broader effort to find this missing child epitomizes their dedication to duty and ‘others before self’ attitude,” said Administrator Caren Harp. “The Department of Justice applauds these brave firefighters, along with those law enforcement and Tennessee National Guardsmen who quickly mobilized and tirelessly searched to bring this boy and his dog home safely.”
After the Blount County, Tennessee, Fire Department was notified of the missing boy on April 23, 2018, the department organized a search of approximately 100 participants, including first responders from the local sheriff’s department, fire department, the Tennessee Bureau of Investigation, the FBI, and Army National Guard. The 22-hour-search spanned 2,000 acres of rugged, wooded terrain—on foot and by air—on and around Chilhowee Mountain and the Top of the World Community Recreation Center, where the child was last seen. Woods and Webb led a team of reinforcements to continue the search. After seven additional hours, the firefighters found the boy and his dog and ensured the boy received immediate medical treatment for exposure.
The Department also recognized 17 law enforcement officers for their investigations of child predators who sexually assaulted children, or created, viewed, and/or distributed child pornography. Harp also recognized Madison Dozier, a fifth grader at Reiley Elementary School in Alexandria, Kentucky, as the 20th winner of the National Missing Children’s Day poster contest.
Additional information about National Missing Children’s Day is available online.
The Office of Justice Programs, directed by Principal Deputy Assistant Attorney General Matt M. Dummermuth, provides federal leadership, grants and resources to improve the nation’s capacity to prevent and reduce crime, assist victims and enhance the rule of law by strengthening the criminal justice system. More information about OJP and its components can be found at www.ojp.gov.
Justice Department Honors Florida Detective for Investigation of Child Pornography CaseRead the Press Release
The Department of Justice today recognized Detective Lorraine Szczepanik of the Broward County Sheriff’s Office, in Fort Lauderdale, Florida, for her investigation and subsequent arrest of three local child pornographers and the identification of a fourth suspect. Three were prosecuted, pleading guilty to possession of child pornography and receiving prison sentences. A case is pending against the fourth suspect.
Principal Associate Deputy Attorney General Ed O’Callaghan, Office of Justice Programs Principal Deputy Assistant Attorney General Matt Dummermuth, Office of Juvenile Justice and Delinquency Prevention Administrator Caren Harp presented the Attorney General’s Special Commendation to Szczepanik during the Department’s National Missing Children’s Day ceremony. The special commendation recognizes Internet Crimes Against Children task forces, affiliate agencies, or an individual assigned to either for making significant investigative or program contributions.
“Detective Szczepanik’s thoroughness in her investigation helped bring not one, but at least three perpetrators of internet-based crimes against children to justice,” said Administrator Care Harp. “The Department of Justice applauds her efforts and stands with the South Florida Internet Crimes Against Children Task Force as we continue to improve public safety for America’s children.”
Szczepanik’s investigation led her to the first suspect after two separate cyber tips reported child pornography use on Google and Tumblr. The suspect admitted his guilt in downloading and viewing child pornography. A search of his digital devices, along with a partial forensic examination, revealed thousands of pornographic images and videos of infants and toddlers, as well as online conversations that identified the three other pornographers.
The Department also recognized 16 other law enforcement officers for their investigations of child predators who sexually assaulted children, or created or viewed child pornography, as well as two firefighters who found a lost six-year-old boy. Harp also recognized Madison Dozier, a fifth grader at Reiley Elementary School in Alexandria, Kentucky, as the 20th winner of the National Missing Children’s Day poster contest.
Additional information about National Missing Children’s Day is available online.
The Office of Justice Programs, directed by Principal Deputy Assistant Attorney General Matt M. Dummermuth, provides federal leadership, grants and resources to improve the nation’s capacity to prevent and reduce crime, assist victims and enhance the rule of law by strengthening the criminal justice system. More information about OJP and its components can be found at www.ojp.gov.
Judge Orders Mobile Man to Serve 60 Months Prison and to Forfeit $3K in Drug ProceedsRead the Press Release
United States Attorney Richard W. Moore of the Southern District of Alabama announces that United States District Court Judge Jeffrey U. Beaverstock sentenced Cornelius Darrell Curtis, on May 20, 2019, to 60 months for the violation of 18 United States Code Section 924(c), Using, Carrying, or Possessing a Firearm During or in Relation to a Drug Trafficking Crime.
On May 2, 2018 members of the Prichard Narcotics Unit made an initial traffic stop of Curtis in the area of Rebel Road and Anderson, in Prichard, Alabama, when they observed him make a right turn onto Main Street without using a turn signal. Curtis was the sole occupant of the vehicle. When officers approached, they noticed several baggies on the front seat. Upon closer examination, officers noted the content of the baggies included marijuana. They also recovered an additional baggie from the center console containing crack cocaine, and more cocaine in Curtis’s hand.
Prichard Police later searched the vehicle and recovered a digital scale with remnants of both cocaine and marijuana residue on it, along with two bottles of codeine syrup in the passenger seat. Officers also recovered a Smith and Wesson .40 caliber handgun and $3,346.00 in cash from the floorboard and passenger seat. As officers continued to search his vehicle, Curtis shouted, “Man that’s all of it, you got all I had.” When asked by the officers how much money he had in his possession, Curtis responded, “About three or four bands.”
Curtis had previous felony convictions from the Circuit Court of Mobile, Alabama for Possession of Controlled Substances; Receiving Stolen Property, Assault and Possession of a Pistol by a Forbidden Person.
The Prichard Police Department, and Bureau of Alcohol Firearms, Tobacco and Explosives, Mobile Field Office conducted the investigation. Assistant United States Attorney Christopher Baugh prosecuted the case for the United States Attorney’s Office for the Southern District of Alabama.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Alabama at http://www.justice.gov/usao-sdal/
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Jefferson County woman admits to her role in a heroin, cocaine, and fentanyl distribution operation in Berkeley and Jefferson CountiesRead the Press Release
MARTINSBURG, WEST VIRGINIA – Amy Little, of Harpers Ferry, West Virginia, has admitted to her role in a heroin, cocaine, and fentanyl distribution operation, United States Attorney Bill Powell announced.
Little, also known as “Amy Jackson,” age 45, pled guilty today to one count of “Unlawful Use of Communication facility.” Little admitted to using a phone to arrange a purchase of heroin in September 2018 in Berkeley County.Little faces up to four years incarceration and fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
This case is the result of investigations supported by the Organized Crime Drug Enforcement Task Force (OCDETF) under the Attorney General-led Synthetic Opioid Surge (SOS)/Special Operations Division (SOD) Project Clean Sweep. This initiative seeks to reduce the supply of synthetic opioids in “hot spot” areas previously identified by the Attorney General of the United States, thereby reducing drug overdoses and drug overdose deaths, and identify wholesale distribution networks and sources of supply operating nationally and internationally.
Assistant U.S. Attorney Lara K. Omps-Botteicher, Special Assistant U.S. Attorney C. Lydia Lehman, also with the Berkeley County Prosecuting Attorney’s Office, and Assistant U.S Attorney Timothy D. Helman, are prosecuting the case on behalf of the government. The Federal Bureau of Investigation; the West Virginia State Police; the Eastern Panhandle Drug & Violent Crimes Task Force, a HIDTA-funded initiative; the Berkeley County Prosecuting Attorney’s Office, the Berkeley County Sheriff’s Office, the Jefferson County Sheriff’s Office, the Martinsburg Police Department, the Charles Town Police Department, and the Ranson Police Department investigated.
The investigation was funded by the federal Organized Crime Drug Enforcement Task Force Program (OCDETF). The OCDETF program supplies critical federal funding and coordination that allows federal and state agencies to work together to successfully identify, investigate, and prosecute major interstate and international drug trafficking organizations and other criminal enterprises.
U.S. Magistrate Judge Robert W. Trumble presided.
Jackson Man Pleads Guilty under Project EJECT to Armed Robbery of a Dollar General StoreRead the Press Release
Jackson, Miss. – Darryl De’Monte Thompson, 30, of Jackson, pled guilty today before U.S. District Judge Carlton Reeves to armed robbery of a Dollar General store in Jackson and brandishing a firearm during a crime of violence, announced U.S. Attorney Mike Hurst and Special Agent in Charge Christopher Freeze with the Federal Bureau of Investigation (FBI).
On April 6, 2018, Thompson and Jalen Simmons entered the Dollar General on Briarwood Drive in Jackson. Thompson served as the lookout while Simmons entered the store, brandished a gun, and demanded cash from the register. When the cashier was unable to open the register, Simmons robbed customers at gunpoint. Officers with the Jackson Police Department apprehended both suspects as they fled the scene.
On September 29, 2018, Simmons and Thompson were charged in a federal criminal indictment with one count of robbery and one count of brandishing a firearm during a crime of violence. Simmons pled guilty before Judge Reeves on December 17, 2018. He was sentenced on March 22, 2019 to seven years and one day in prison for his role in the crime.
Thompson will be sentenced by Judge Reeves on August 23, 2019 at 9:00 a.m. He faces a sentence of seven years to life for brandishing the weapon and a maximum sentence of 20 years for the robbery.
This case was investigated by the Federal Bureau of Investigation and the Jackson Police Department. It case was prosecuted by Assistant United States Attorney Kimberly Purdie.
This case is part of Project EJECT, an initiative by the U.S. Attorney’s Office for the Southern District of Mississippi under the U.S. Department of Justice’s Project Safe Neighborhoods (PSN). EJECT is a holistic, multi-disciplinary approach to fighting and reducing violent crime through prosecution, prevention, re-entry and awareness. EJECT stands for "Empower Justice Expel Crime Together." PSN is bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Former Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
IAV GmbH Sentenced to Pay $35 Million Criminal Fine for its Role in Volkswagen AG Emissions FraudRead the Press Release
IAV GmbH (IAV), a German company that engineers and designs automotive systems, was sentenced in federal court in Detroit today to pay a $35 million criminal penalty.
The penalty is the result of the company’s guilty plea for its role in a long-running scheme for Volkswagen AG (VW) to sell approximately 335,000 diesel vehicles in the U.S. by using a defeat device to cheat on U.S. emissions tests mandated by the U.S. Environmental Protection Agency (EPA) and the California Air Resources Board (CARB). During the sentencing hearing, U.S. District Judge Sean F. Cox of the Eastern District of Michigan accepted the parties’ plea agreement, which includes the appointment of an independent corporate compliance monitor for a period of two years.
Principal Deputy Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, U.S. Attorney Matthew J. Schneider of the Eastern District of Michigan, Deputy Assistant Attorney General Jean E. Williams of the Justice Department’s Environment and Natural Resources Division, Assistant Administrator Susan Bodine of the EPA’s Office of Enforcement and Compliance Assurance and Special Agent in Charge Timothy R. Slater of the FBI’s Field Office made the announcement.
IAV pleaded guilty in December 2018 to participating in a conspiracy to defraud the United States and VW’s U.S. customers and to violate the Clean Air Act by misleading the EPA and U.S. customers about whether certain VW- and Audi-branded diesel vehicles complied with U.S. emissions standards. IAV admitted that it and its co-conspirators knew the vehicles did not meet U.S. emissions standards and worked collaboratively to design, test and implement cheating software to cheat the U.S. testing process. IAV further admitted that it was aware the VW concealed material facts about its cheating from federal and state regulators and U.S. customers. Pursuant to the U.S. Sentencing Guidelines, IAV’s $35 million fine was set according to the company’s inability to pay a higher fine amount without jeopardizing its continued viability.
The case was investigated by the FBI and EPA-Criminal Investigation Division. The prosecution is being handled by Trial Attorneys Philip Trout, Mark Cipolletti and Gary Winters of the Criminal Division’s Fraud Section; Senior Trial Attorney Jennifer Blackwell of the Environment and Natural Resources Division’s Environmental Crimes Section; and White Collar Crime Unit Chief John K. Neal of the U.S. Attorney’s Office for the Eastern District of Michigan. The Criminal Division’s Office of International Affairs also assisted in the case. The Justice Department also extends its thanks to the Office of the Public Prosecutor in Braunschweig, Germany.
Holdenville Man Pleads Guilty to Kidnapping, Firearm PossessionRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that Nicholas Earl Faulkner, a.k.a. "Ponyboy," age 32, of Holdenville, Oklahoma, entered a guilty plea to Kidnapping, in violation of Title 18, United States Code Sections 1201(a)(1), 2, 1151 and 1153, punishable by not more than 20 years imprisonment, a fine up to $250,000.00, or both; and to Felon In Possession Of Firearm, in violation of Title 18, United States Code, Sections 922(g)(1), 924(a)(2), punishable by not more than 10 years imprisonment, a fine up to $250,000.00, or both.
The Indictment alleges that on or about April 16, 2017, in the Eastern District of Oklahoma, within Indian Country, on an Indian allotment, the Indian title to which had not been extinguished, the defendant, an Indian, did unlawfully and willfully seize, confine, inveigle, decoy, kidnap, abduct, carry away, and hold for some benefit, Nicole Marlene Owl, and, in furtherance of the commission of the offense, used any means, facility, or instrumentality of interstate or foreign commerce.
The Indictment further alleges that on or about April 17, 2017, within the Eastern District of Oklahoma, and within the jurisdiction of this Court, the defendant, having been convicted of a crime punishable by imprisonment for a term exceeding one year, did knowingly possess in and affecting commerce, a firearm and ammunition which had been shipped and transported in interstate commerce.
The charges arose from an investigation by the Oklahoma State Bureau of Narcotics and Dangerous Drugs, the Oklahoma State Bureau of Investigation, the Federal Bureau of Investigation, and the Seminole Nation Lighthorse police.
The Honorable Steven P. Shreder, U.S. Magistrate Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, accepted the plea and ordered the completion of a presentence investigation report.
Assistant United States Attorney Edward Snow with the United States Attorney’s Office for the Eastern District of Oklahoma and Assistant United States Attorney Mona Sahaf with the Special Prosecutions Section, for the United States Department of Justice Criminal Division represented the United States.
Grant County woman admits to mail fraudRead the Press Release
ELKINS, WEST VIRGINIA – Sandra Mae Evans, of Petersburg, West Virginia, has admitted to mail fraud, United States Attorney Bill Powell announced.
Evans, age 62, pled guilty today one count of “Mail Fraud.” Evans admitted to opening an IRA account at Pendleton Community Bank’s Petersburg, West Virginia, branch in July 2018. A check in the amount of $82,170.50 was mailed from St. Louis, Missouri to Pendleton Community Bank to be deposited into Evan’s IRA account. Evans then deposited the check in August 2018, knowing the check was fraudulent. Evans admits to then requesting and successfully collecting withdrawals from the fraudulent check totaling more than $42,000. Evans then sent $18,000 cash to someone in Florida and $11,000 cash to someone in Utah.Evans has agreed to pay $35,808.05 in restitution to the Pendleton Community Bank. The amount represents the unrecovered amount of withdrawals made against the fraudulent check.
Evans faces up to 20 years incarceration and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Jarod J. Douglas is prosecuting the case on behalf of the government. The U.S. Postal Inspection Service and the West Virginia State Police investigated.
U.S. Magistrate Judge Michael John Aloi presided.
Gary Man Sentenced to 70 Months in PrisonRead the Press Release
HAMMOND- Terry Brown, 33, of Gary, Indiana, was sentenced by U.S. District Court Judge Joseph S. Van Bokkelen on his plea of guilty to distribution of cocaine and possession of a firearm in furtherance of a drug trafficking crime, announced U.S. Attorney Kirsch.
Brown was sentenced to 70 months in prison followed by 3 years of supervised release.
According to documents in the case, beginning in December 2017 and continuing through February 2018, Mr. Brown sold cocaine and marijuana to a confidential informant. On one of the occasions, he sold, in addition to cocaine and marijuana, a 30 round drum magazine, a stolen .45 caliber firearm and ammunition to a confidential informant.
This case was investigated by the ATF/HIDTA Task Force and FBI/GRIT Task Force with the assistance of the Indiana State Police, the Lake County Sheriff’s Department, and the Gary Police Department. The case was handled by Assistant U.S. Attorneys Thomas R. Mahoney and Joseph A. Cooley.
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Fugitive Headed to Prison After Failing to Appear for SentencingRead the Press Release
BROWNSVILLE, Texas - A 46-year old Brownsville resident has been ordered to federal prison for 18 years following his conviction of conspiracy to possess with intent to distribute more than 100 kilograms of marijuana plus failing to appear in court for sentencing, announced U.S. Attorney Ryan K. Patrick.
Rene Izaguirre pleaded guilty to the drug charge Jan. 19, 2013, and was permitted to remain on bond. He was scheduled to appear in court Aug. 28, 2013, for sentencing. However, shortly before that date, Izaguirre’s ankle monitor was found cut off and left behind at his home. The investigation revealed he had fled to Mexico. He was later arrested and pleaded guilty to the failure to appear Dec. 6, 2018.
Today, U. S. District Judge Rolando Olvera imposed a 108-month sentence for the drug charge. Izaguirre also received another 108 months for failing to appear which was ordered to be served consecutively. The total 18-year-term of imprisonment will be immediately followed by four years of supervised release. In imposing the sentence, the court noted that not only did the defendant flee in order to avoid sentencing on his drug charge but that he also was found selling narcotics once again while on the run.
From 2007 to 2013, Izaguirre was part of a drug trafficking organization working with a local freight company to hide marijuana in crates of heavy machinery for transport north of the Rio Grande Valley. At the time of his plea, he admitted that with the help of his freight company contact, he was able to ship more than 700 kilograms of marijuana to Houston, Dallas and Pennsylvania where he had buyers.
After fleeing and failing to appear for sentencing, law enforcement found him in October 2018 in Odessa. At that time, authorities believed he was selling cocaine out of a trailer where he resided while working as a roofer. He was soon arrested and found in possession of nine ounces of cocaine.
Izaguirre remains in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The Drug Enforcement Administration conducted the investigation. Assistant U.S. Attorney Karen Betancourt prosecuted the case.
Four Michigan Defendants Plead Guilty to Conspiracy to Defraud the IRS and Steal from an Organization Receiving Federal FundsRead the Press Release
Four individuals in Flint, Michigan, pleaded guilty today to conspiring to impede the lawful functions of the Internal Revenue Service (IRS) and steal from an organization receiving federal funds, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division.
Jayson Rosett, Robert Rosett, Carol Almeranti, and Karen Miller each pleaded guilty to one count of conspiring to defraud the United States by impeding the lawful functions of the IRS and one count of conspiring to commit theft from an organization receiving federal funds.
According to court documents, from July 2012 through April 2018, Jayson Rosett, a resident of Bloomfield Hills, Robert Rosett, a resident of Boca Raton, Florida, Carol Almeranti, a resident of Farmington Hills, and Karen Miller, a resident of St. Clair Shores, engaged in a scheme in which Almeranti and Miller stole traffic crash reports from the Detroit Police Department (DPD) and delivered them to the Rosetts for regular cash payments. Many of the stolen DPD crash reports were marked “unapproved” and were not publicly available. Jayson Rosett and others used the stolen reports to solicit crash victims for clients of a business Rosett operated, including personal injury lawyers, chiropractors, and healthcare professionals.
United States District Court Judge Matthew F. Leitman scheduled sentencing for Jayson Rosett on Oct. 1, for Carol Almeranti and Karen Miller on Oct. 3, and for Robert Rosett on Oct. 8. All four defendants face a maximum of five years in prison and a $250,000 fine for each individual count of conspiring to defraud the United States and conspiring to commit theft from an organization receiving federal funds. Each defendant also faces a period of supervised release, restitution and monetary penalties.
Acting Deputy Assistant Attorney General Goldberg thanked special agents of IRS-Criminal Investigation and the Federal Bureau of Investigation, who conducted the investigation, and Tax Division Trial Attorneys Mark McDonald and William Guappone, who are prosecuting the case.
Additional information about the Tax Division’s enforcement efforts can be found on the division’s website.
Four Men Indicted on Fraud Charges Related to the Jay Peak EB-5 AnC Vermont Project in Northeast VermontRead the Press Release
Four individuals were charged with conspiring in a multi-year wire fraud scheme to defraud immigrant investors seeking green cards through the EB-5 program, among other charges, announced United States Attorney for the District of Vermont Christina E. Nolan.
Ariel Quiros, 63, William Kelly, 70, both of Florida; Jong Weon Choi, aka Alex Choi, 58, of South Korea; and William Stenger, 70, of Newport, Vermont, were indicted by the federal grand jury on criminal charges in connection with their management of the Jay Peak Biomedical Research Park EB-5 investment project, also called the AnC Vermont project. In addition to the wire fraud conspiracy count, the defendants face other charges, including six separate counts of wire fraud and various counts of concealing material facts or presenting false statements in a matter within the jurisdiction of a federal agency, namely United States Citizenship and Immigration Services (USCIS), which oversaw the EB-5 process. Quiros is also charged with two counts of money laundering. The indictment alleges that the defendants misrepresented facts to the SEC, which investigated the Jay Peak EB-5 offerings while the defendants were seeking new AnC investors. A civil action by the SEC ended the defendants’ control of the EB-5 projects.
U.S. Attorney Christina E. Nolan stated: “As alleged in this indictment, this scheme defrauded hopeful immigrant investors in what may be the largest financial crime in our state history. I commend our prosecutors and our partners in the FBI, IRS, and FDA-OIG for their dogged investigation of this complex fraud that shook our small state. This indictment demonstrates that the U.S. Attorney’s Office is determined to address the most challenging cases, and that we have the talent, will, and resources in our office and law enforcement agencies to meet those challenges.”
The charges against the defendants are only allegations. The defendants are presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law. The defendants face a maximum penalty on the most serious charges of 20 years in prison, three years of supervised release, a $250,000 fine or twice the gross gain or loss, and restitution to the victims. The indictment also alleges forfeiture against the defendants.
“This case is about greed and deceit. The fraud alleged in this indictment and the related fraud alleged by the SEC and the State of Vermont have affected many Vermonters,” stated James N. Hendricks, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation. “The defendants’ broken business promises have left not only a physical scar on the city of Newport, but also an intangible scar on the promise of economic development for the Northeast Kingdom and on the dreams of many hopeful immigrants. By seeking to hold accountable those who break the law and cause such harm, we hope to help to heal these scars. The dedicated work and cooperation among the FBI, IRS, FDA and U.S. Attorney’s Office have resulted in the arrests today. The FBI will continue working with our law enforcement partners to stop those who abuse government programs for their own gain.”
“As alleged in the indictment, the defendants obtained tens of millions from investors in connection with an EB-5 offering that was based on misleading statements and involved a misuse of the money raised,” said Kristina O’Connell, Special Agent in Charge of IRS Criminal Investigation, Boston Field Office. “IRS-CI’s tracing of the investors’ funds helped investigators uncover the breadth of the alleged fraud and we are proud of our role in this collaborative law enforcement effort.”
The indictment alleges a scheme conceived in 2011 and carried through until the defendants lost control of the project in April 2016. The AnC project was the seventh EB-5 project managed by Quiros and Stenger, but the first involving a business outside a ski resort. The defendants designed the project to raise $110 million from immigrant investors in order to build and operate a biotechnology company, AnC Vermont, on a property in Newport. From 2012 to 2016, the defendants obtained over $80 million from over 160 immigrant investors in the AnC project. Under the EB-5 program created by Congress, immigrant investors could obtain lawful permanent residency (green cards) by investing $500,000 each in a United States business that would create ten jobs per investment. Pursuant to federal law, the AnC project was regulated and monitored by USCIS and the Vermont Regional Center, a part of state government.
According to the indictment, the defendants’ scheme involved both secret embezzlement of immigrant investor funds and deceit about the AnC project’s jobs and revenue. The defendants designed the project so that Quiros and Choi, who were secret partners, could siphon millions of dollars in investor funds into their pockets. As the defendants raised investor money, Quiros used the money for his own purposes instead of using it to build the project. The defendants then concealed this misuse of funds.
The indictment also charges that the defendants created a fraudulent AnC business plan based on a “party line” conceived to misrepresent the number of jobs that would be created by the project and the business revenue that would be generated from the project. Marketing the project to immigrant investors depended on job creation and future revenue, since the defendants emphasized their ability to satisfy the job creation standards under EB-5 law and repay immigrant investors. The indictment charges that the defendants devised job and revenue projections based on the number of jobs needed to obtain project approval from USCIS without regard to a viable plan to actually create those jobs or achieve those revenues. AnC Vermont would supposedly rent clean rooms, market stem cell therapies, and manufacture artificial organs. The defendants made fraudulent statements in regard to all three facets of the future business, in particular with regard to how soon the project would generate jobs and revenue. Rather than disclose that they were creating a start-up business that would need large capital reserves to operate in the early stages, the defendants falsely represented that they had a plan where AnC Vermont would successfully market its products as soon as construction was complete.
In addition to the wire fraud and wire fraud conspiracy charges, the indictment charges Quiros with two money laundering counts relating to two transactions where he used AnC investor funds for personal expenses, specifically a $6 million payment to the IRS and the purchase of a vehicle.
Further, the indictment contains five concealment or false statement counts. First, it alleges that the defendants concealed from the Vermont Regional Center how Quiros used approximately $21 million in investor funds to pay off a loan unrelated to the AnC Vermont project. Next, the indictment alleges that Quiros, Kelly, and Choi concealed that Choi was being investigated in Korea for financial crimes, and falsely represented that AnC Korea, a company they claimed would supply the technologies that AnC Vermont would market, was not in financial distress.
Finally, the indictment charges Stenger with presenting false documents and statements to the Vermont Regional Center. One of these counts focuses on a misrepresentation by Stenger that he had followed the Regional Center’s direction to stop marketing the AnC project in mid-2014. The other charges as false a written presentation Stenger made to the Regional Center in January 2015 as he was seeking permission to continue recruiting investors for the AnC project.
Quiros, Kelly, and Stenger surrendered to the custody of the United States Marshals Service this morning and are scheduled to appear for arraignment on the charges in federal court later today. Choi remains at large.
The United States Attorney expresses her gratitude for the outstanding investigation leading up to these charges by the Federal Bureau of Investigation, the Criminal Investigation Divisions of the Internal Revenue Service, the Food and Drug Administration and for the assistance of the Justice Department’s Office of International Affairs. The prosecutors handling the case are Assistant U.S. Attorneys Nicole Cate and Paul Van de Graaf. Ariel Quiros is represented by Seth Levine, Esq. William Kelly is represented by Robert Goldstein, Esq. William Stenger is represented by Brooks McArthur, Esq.
Former U.S. Postal Service Employee Sentenced for Embezzling MailRead the Press Release
Jackson, Miss. – Latoya Rosell, 34, of Flora, was sentenced today by U.S. District Judge Carlton W. Reeves to two years of probation for embezzling mail matter during the course of her employment with the U.S. Postal Service, announced U.S. Attorney Mike Hurst and Special Agent in Charge Chris Cave, U.S. Postal Service Office of Inspector General, Southern Area Field Office. Rosell was also ordered to pay a $1500 fine and $100 in restitution to one of the victims of her crime.
Rosell was employed as a Rural Carrier Associate at the Ridgeland Post Office in Ridgeland, Mississippi. On August 15, 2018, agents were notified that expected mail matter was not being delivered along Rosell’s route. A subsequent operation run by investigators utilized monitored test pieces to confirm that Rosell was embezzling mail containing gift cards and U.S. currency. When confronted, Rosell admitted she had been embezzling the mail and immediately resigned her position. Agents recovered some, but not all, of the property embezzled by Rosell.
On December 12, 2018, Rosell was charged in a criminal indictment with embezzling mail. She pled guilty before Judge Reeves on February 20, 2019.
This case was investigated by the U.S. Postal Service Office of Inspector General. It was prosecuted by Assistant United States Attorney Andrew W. Eichner.
Former Tax Protestor Sentenced to Prison for Evading TaxesRead the Press Release
Matthew D. Krueger, the United States Attorney for the Eastern District of Wisconsin, announced that Richard J. Clark (age 71) was sentenced on May 21, 2019 in federal court in Milwaukee to 14 months in prison, to be followed by three years of supervised release, and ordered to pay $213,000 in restitution to the IRS.
Clark, who resides in Mukwonago, previously operated Foremost Realty, LLC, a real estate business that listed, maintained, and sold foreclosed property in southeastern Wisconsin. During the years 2008 – 2013, Clark, through his business, received approximately $1.6 million in commissions. Despite receiving these commissions, Clark filed tax returns that either listed $0 on all lines of the returns, reporting no income or tax obligations, or reported very minimal income and taxes. As a result, during the years 2008-2013, Clark evaded more than $400,000 in federal income taxes.
Clark was previously the subject of a civil action brought by the U.S. Department of Justice concerning his 2002-2007 tax returns, on which Clark also reported no income or taxes. At sentencing, Clark acknowledged his former tax-protestor beliefs but stated that he had abandoned those misguided beliefs and intended to dedicate himself to making amends and repaying the taxes he owes.
This matter was investigated by the criminal investigation division of the Internal Revenue Service. The prosecution was handled by Assistant United States Attorney Matthew L. Jacobs.
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Former Olympic Athlete and Coach Found Guilty of Coercion/Enticement and Transportation of A Minor with the Intent of Committing A Criminal Sexual ActRead the Press Release
SAN JUAN, P.R. – After a three-day jury trial, Alexander Greaux-Gómez was found guilty of sexual enticement of a minor, and transportation with intent to engage in criminal sexual activity, announced United States Attorney Rosa Emilia Rodríguez-Vélez. United States District Court Judge Francisco A. Besosa presided over the trial.
On February 9, 2017, U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) special agents, working jointly with Puerto Rico Police Department’s Division of Sexual Crimes in Guayama, and prosecutors from the Puerto Rico Department of Justice, arrested Greaux-Gómez, former teacher and track and field coach of the Salinas’s specialized sports school, “Albergue Olímpico,” for sexual enticement of a minor and production of child pornography.
On March 8, 2017 the defendant was indicted for production of child pornography, sexual enticement of a minor, and transportation with intent to engage in criminal sexual activity. During the trial, the government’s evidence proved that the female minor first met the defendant in 7th grade when she went to train and attend boarding school at “Albergue Olímpico.” The defendant, a former Olympic athlete, took a special interest in the minor. This interest became personal and then eventually sexual in nature. The minor was 15 years old and the defendant was 39 when he began preying on her and convincing her to engage in sexual acts at the school, in his car, and at an abandoned home school he once operated.
The defendant also had strict rules he gave to the minor over WhatsApp about the secrecy of their relationship and would send extremely sexually graphic communications to her.
“This conviction shows the commitment of our state and federal law enforcement agencies to apprehend and prosecute child predators,” said United States Attorney for the District of Puerto Rico, Rosa Emilia Rodríguez-Vélez. “We entrust teachers to serve as role models for our children and safeguard their welfare. As this verdict makes clear, when that trust is violated, there will be severe consequences.”
The case was prosecuted by Assistant United States Attorney Ginette Milanes. The defendant faces a mandatory minimum sentence of 10 years in prison. The sentencing is scheduled for August 22, 2019 at 9:00 am.
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Former New Haven City Employee Admits Embezzling $100KRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that DANIEL LION, 64, of Hamden, waived his right to be indicted and pleaded guilty today before U.S. District Judge Janet C. Hall in New Haven to one count of wire fraud stemming from a long-running embezzlement scheme.
According to court documents and statements made in court, Lion was employed by the City of New Haven for approximately 40 years, most recently in the city’s accounting department. New Haven has a policy where employees can be paid in advance if they are about to take approved vacation leave. As part of his employment, Lion had access to the city’s payroll system.
From approximately 2002 to June 2018, Lion periodically accessed the city’s financial accounting software to issue vacation paychecks to himself. He then deleted the computer entries for the checks, which caused the payroll system to issue his regular paycheck, as well. Through this scheme, Lion stole $102,947.44 from the City of New Haven.
Judge Hall scheduled sentencing for September 4, 2019, at which time Lion faces a maximum term of imprisonment of 20 years, a fine of up to $250,000, and an order of restitution. Lion is released pending sentencing.
Lion retired from the City of New Haven in March 2019.
This ongoing investigation is being conducted by the Connecticut Financial Crimes Task Force, U.S. Secret Service and New Haven Police Department. The case is being prosecuted by Assistant U.S. Attorney Ray Miller.
Former Jacksonville High School Teacher Pleads Guilty to Distributing Child PornographyRead the Press Release
Jacksonville, Florida – Jordan Frederic Schemmel (37, Ormond Beach) has pleaded guilty to distributing child pornography over the internet. He faces a mandatory minimum penalty of 5 years, and up to 20 years, in federal prison and a potential life term of supervised release. Additionally, Schemmel will be required to register as a sex offender. A sentencing date has not yet been set.
According to court documents, on September 5, 2018, Schemmel, using the user name “Profsunrise15,” responded to a message on an internet bulletin board frequented by individuals with a sexual interest in children. This message had been posted by an undercover FBI agent. Schemmel then began an online conversation with the agent using a popular social messaging application. After some conversation about sexual interest in children, Schemmel sent the agent a video that depicted a young child being sexually assaulted by an adult male, and later sent a photo depicting similar criminal conduct with a child. FBI agents were able to identify the IP address used by Schemmel and tracked it to his residence. At that time, Schemmel was a teacher at Terry Parker High School in Jacksonville.
On October 19, 2018, law enforcement executed a search warrant at Schemmel’s home. During an interview, Schemmel stated that he had sent the child-pornographic video using the app, and that he had previously tried unsuccessfully to stop viewing child pornography on a number of occasions. A forensic examination of his smartphone and a thumb drive seized from his home revealed that Schemmel had collected 106 images and 28 videos depicting young children being sexually abused.
This case was investigated by the FBI, United States Customs and Border Protection, and the Jacksonville Sheriff’s Office. It is being prosecuted by Assistant United States Attorney D. Rodney Brown.
It is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Former Canton resident extradited from Vietnam to face child pornography chargesRead the Press Release
A former Canton resident was extradited from Vietnam to face child pornography charges.
The two-count indictment was unsealed Wednesday upon the extradition of Larry P. Smith from Vietnam. Smith, 67, was indicted on one count of receipt and distribution of child pornography and one count of possession of child pornography.
Smith knowingly received and distributed numerous computer filed containing visual depictions of minors engaged in sexually explicit conduct in October 2013. On November 20, 2013, Smith possessed several laptops, an Apple computer and hard drives that contained images of prepubescent children engaged in sexual activity, according to the indictment.
Smith lived in Canton at the time of the alleged offenses, then moved to Florida prior to his indictment. He was located in Vietnam and was returned to the United States Wednesday. He is scheduled to appear in federal court later this afternoon in Seattle.
This case was investigated by the FBI and Canton Police Department. It is being prosecuted by Assistant U.S. Attorney Carol M. Skutnik.
If convicted, the defendants’ sentence will be determined by the Court after review of factors unique to this case, including the defendants’ prior criminal records, if any, the defendants’ role in the offense and the characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. The burden of proof is always on the government to prove a defendant guilty beyond a reasonable doubt.
Former Burns Municipal Airport Manager Sentenced to Probation for Stealing Surplus Federal PropertyRead the Press Release
EUGENE, Ore.—Jeffrey Robert Cotton, 45, the former Manager of the Burns Municipal Airport in Burns, Oregon, was sentenced today to 4 years’ probation and 300 hours of community service for stealing thousands of dollars of equipment that rightfully belonged to the City of Burns, by converting to his personal use property acquired through the Federal Personal Property Utilization Program.
The Federal Personal Property Utilization Program is intended to benefit state and local governments and eligible organizations by giving them property the federal government no longer needs at no cost.
According to court documents, between 2014 and 2016, Cotton acquired, allegedly on behalf of the airport, numerous pieces of federal excess property including a heater/air conditioner, commercial lighting sets and various trucks and vans, tractors, and other heavy equipment.
Throughout the acquisition process, Cotton failed to fully inform or notify the City of Burns, its mayor, city manager or city council of the federal excess property obtained on its behalf. Instead, Cotton illegally converted much of the property to his personal use, either by titling property in his own name or transferring the property to Emergency Equipment Solutions, Inc. (EES), a nonprofit fully owned and operated by Cotton.
When confronted with the theft, Cotton lied and misrepresented information regarding how he had obtained the property. Additionally, Cotton signed phony bills of sale falsely representing that EES had purchased the property. Records show thousands of dollars were transferred from EES to Cotton personally.
On April 11, 2019, Cotton pleaded guilty to two counts of theft from a local government receiving federal funds.
This case was investigated by the General Services Administration Office of Inspector General and the FBI, and was prosecuted by Gavin W. Bruce, Assistant U.S. Attorney for the District of Oregon.
Five People Charged with Forced Labor Conspiracy Involving Trafficking of Victims from Georgia to Work on Wisconsin FarmsRead the Press Release
United States Attorney Matthew D. Krueger of the Eastern District of Wisconsin announced today that five people were indicted for conspiracy to commit forced labor, labor trafficking, and five additional labor-related offenses. The defendants are alleged to have trafficked the victims from Georgia to Wisconsin to work on farms located in the Eastern District of Wisconsin in 2016.
The indictment named:
Name
Age
Residence
Saul Garcia
49
Moultrie, GA
Saul Garcia, Jr
26
Moultrie, GA
Daniel Garcia
28
Moultrie, GA
Consuelo Garcia
45
Moultrie, GA
Maria Remedios Garcia-Olalde
52
Mexican National
According to the indictment, the defendants conspired to provide the labor and services of fourteen adult victims, all of whom are male Mexican nationals, by means of (1) serious harm and threats of serious harm, (2) abuse and threatened abuse of legal process, and (3) a scheme intended to cause the victims to believe that, if they did not perform such labor and services, they would suffer serious harm. The indictment alleges that to restrict the victims’ movement and ability to travel while in Wisconsin, the defendants’ possessed the victims’ passports. Two of the five defendants—Saul Garcia Sr. and Maria Remedios Garcia-Olalde—were also indicted on obstruction charges.
“Trafficking another human being is a particularly vile crime,” said U.S. Attorney Krueger. “The Department of Justice is committed to prosecuting anyone who seeks to sell another person’s freedom.”
If convicted, the defendants face up to 20 years in prison on the charges of forced labor conspiracy, trafficking with respect to forced labor, financial benefit from forced labor, obstruction of a labor trafficking investigation, and witness tampering. The indictment also identifies fifteen real properties located in Georgia.
The defendants were charged based on a multi-year investigation by law enforcement agents and officers from the Federal Bureau of Investigation’s Human Trafficking Task Force, including special agents and officers representing the Department of Labor Office of Inspector General, the Federal Bureau of Investigation, Homeland Security Investigations and the City of Racine Police Department.
The case is being prosecuted by Assistant United States Attorneys Laura S. Kwaterski, Erica J. Lounsberry, and Karine Moreno-Taxman.
The public is cautioned that an indictment is merely a charge and the defendant is presumed innocent until and unless proven guilty.
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Five Eastern Iowa Men Charged with Sex Trafficking MinorsRead the Press Release
DES MOINES, Iowa – On May 15, 2019, a federal grand jury returned an Indictment charging five defendants with sex trafficking announced United States Attorney Marc Krickbaum. All five defendants have been arrested and appeared in federal court in Des Moines, Iowa. Trial is expected to be scheduled for a date later this year, before United States District Court Judge Stephanie M. Rose. The defendants are currently in federal custody.
According to the Indictment, Arrion Marcus West, age 25, is alleged to have sex trafficked one minor victim in October and November 2018, and sex trafficked a second minor victim by force, fraud, and coercion, from January through March 2018. West is further alleged to have provided marijuana to the second victim. West is alleged to have enticed, recruited, and transported minor victims to engage in commercial sex acts, and taken proceeds from those commercial sex acts.
Albert Kelly Price, age 39, is charged with trafficking three separate minor victims by force, fraud, and coercion, and with distributing marijuana to two of those victims. Price is alleged to have transported the minor victims to hotels and other locations where he paid minor victims to engage in sex acts, all while in reckless disregard of the fact they were under the age of 18. The Indictment further alleges Price knew that force, fraud, or coercion was used to cause them to engage in commercial sex acts, in that the government alleges Price himself used force, fraud, and coercion on at least one occasion with each minor victim.
Kendall Andrew Streb, age 52, is charged with several sex trafficking, drug, and firearm offenses, occurring between February 2018 and February 2019. Streb is charged with sex trafficking two separate minors, by transporting those minors to hotel rooms, and paying the minor victims to engage in sex acts. Streb is also charged with distributing methamphetamine to minors, possession with intent to distribute methamphetamine, and with offenses related to possessing firearms while being a drug user and in connection with a drug trafficking offense.
Tommy Tate Collins, age 40, is charged with sex trafficking a minor, and distributing marijuana and cocaine to that minor. Collins is also alleged to have paid the minor victim to engage in commercial sex acts, knowing and in reckless disregard of the fact that she was under the age of 18.
Isaiah Devon Patterson, age 21, is charged with one count of sex trafficking a minor victim. Patterson is alleged to have advertised a minor victim for commercial sex acts, while he knew that she was under the age of 18.
The Indictment alleges that all of these acts occurred within the Southern District of Iowa, in the Johnson County area, and elsewhere.
The public is reminded that an Indictment is merely an accusation, and the defendants are presumed innocent unless they are proven guilty.
Each defendant charged with the offense of sex trafficking by force, fraud, or coercion is subject to a fifteen-year mandatory minimum term of imprisonment up to life imprisonment. Sex trafficking of children, without the allegation of force, fraud, or coercion, carries a ten-year mandatory minimum, and a maximum term of imprisonment of life. West, Streb, Price, and Collins are also charged with coercion and enticement of a minor, which also carries a ten-year mandatory minimum, up to life imprisonment.
Human trafficking is a crime involving the exploitation of youth under the age of 18 for commercial sex; the exploitation of adults for commercial sex through the use of force, fraud, or coercion; and the exploitation of any individual for compelled labor. Human trafficking does not require the transportation of individuals across state lines, or that someone is physically restrained. Signs that a person is being trafficked can include working excessively long hours, unexplained gifts, physical injury, substance abuse issues, running away from home, isolation from others, or having a person in their life controlling them or monitoring them closely. Victims particularly susceptible to being trafficked include those with criminal histories, a history of physical or sexual abuse, uncertain legal status, and dependency on controlled substances. Individuals who purchase sex from minors or from those who are otherwise exploited for commercial sex are also subject to prosecution for sex trafficking under federal law, if they knew or were in reckless disregard of the fact that they were under the age of 18, or that force, fraud, or coercion was used.
Anyone who suspects human trafficking is occurring, be it a minor engaging in paid sex acts, or anyone being coerced into prostitution or labor, is urged to call the National Human Trafficking Hotline at 1-888-373-7888. If anyone has information about these defendants, they are urged to call the Hotline.
The investigation has been spearheaded by the Iowa City Police Department. Investigative support has been provided by the Iowa Division of Criminal Investigation, Johnson County Sheriff’s Office, Coralville Police Department, and Federal Bureau of Investigation. The Johnson County Attorney’s Office has assisted with the prosecution. This case is being prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
Federal Grand Jury Charges San Fernando Valley Man with Planning Long Beach Terror Attack in Plot to Cause Mass CasualtiesRead the Press Release
LOS ANGELES – A federal grand jury has indicted a San Fernando Valley man for his role in planning to bomb a rally in Long Beach last month for the purpose of causing mass casualties.
Mark Steven Domingo, 26, of Reseda, a former U.S. Army infantryman who was deployed to Afghanistan, was previously arrested on a criminal complaint in this case. The indictment returned today formally charges him with providing material support to terrorists and attempted use of a weapon of mass destruction. If convicted, he would face statutory maximum sentence of life in federal prison.
Domingo, who has been in federal custody since his arrest last month, is scheduled to be arraigned on the indictment on May 31 in United States District Court.
According to the affidavit filed with the criminal complaint, Domingo, in online posts and in conversations with an FBI source, expressed support for violent jihad, a desire to seek retribution for attacks against Muslims, and a willingness to become a martyr. After considering various attacks – including targeting Jewish people, churches, and police officers – Domingo decided to bomb a rally scheduled to take place in Long Beach last month. As part of the plot, Domingo asked a confederate – who actually was working with the FBI as part of the investigation – to find a bomb-maker. Domingo then purchased and provided to the confederate and the bomb-maker, who actually was the undercover officer, several hundred nails to be used as shrapnel for the bombs.
Leading up to the planned attack, Domingo called for another event similar to the October 2017 mass shooting in Las Vegas to give Americans “a taste of the terror they gladly spread all over the world,” the complaint states. Following an attack on Muslims in New Zealand on March 15, Domingo wrote in an online post, “there must be retribution,” according to the complaint.
On April 26, Domingo received what he thought was a live bomb, but in fact was an inert explosive device that was delivered by an undercover law enforcement officer. According to the criminal complaint, after receiving the bomb, Domingo drove his confederate and the undercover officer to Long Beach to scout the location Domingo planned to attack. While there, Domingo discussed finding the most crowded areas in order to kill the most people. Domingo was arrested shortly after returning from scouting the intended attack location.
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.
This matter is the product of an investigation by the FBI’s Joint Terrorism Task Force. JTTF members who participated in the investigation include the FBI, the Los Angeles Police Department, the Naval Criminal Investigative Service, the Los Angeles County Sheriff's Department, and the Long Beach Police Department.
This case is being prosecuted by Assistant United States Attorneys Reema M. El-Amamy and David T. Ryan of the Terrorism and Export Crimes Section at the United States Attorney’s Office for the Central District of California and Trial Attorney Ranganath Manthripragada of the Counterterrorism Section at the Department of Justice’s National Security Division.
Federal Grand Jury Charges San Fernando Valley Man with Planning Long Beach Terror Attack in Plot to Cause Mass CasualtiesRead the Press Release
A federal grand jury has indicted a San Fernando Valley man for his role in planning to bomb a rally in Long Beach last month for the purpose of causing mass casualties. Assistant Attorney General for National Security John C. Demers and U.S. Attorney Nicola T. Hanna for the Central District of California made the announcement.
Mark Steven Domingo, 26, of Reseda, California, a former U.S. Army infantryman who was deployed to Afghanistan, was previously arrested on a criminal complaint in this case. The indictment returned today formally charges him with providing material support to terrorists and attempted use of a weapon of mass destruction. If convicted, he would face a statutory maximum sentence of life in federal prison.
Domingo, who has been in federal custody since his arrest last month, is scheduled to be arraigned on the indictment on May 31 in United States District Court.
According to the affidavit filed with the criminal complaint, Domingo, in online posts and in conversations with an FBI source, expressed support for violent jihad, a desire to seek retribution for attacks against Muslims, and a willingness to become a martyr. After considering various attacks – including targeting Jewish people, churches, and police officers – Domingo decided to bomb a rally scheduled to take place in Long Beach last month. As part of the plot, Domingo asked a confederate – who actually was working with the FBI as part of the investigation – to find a bomb-maker. Domingo then purchased and provided to the confederate and the bomb-maker, who was actually an undercover officer, several hundred nails to be used as shrapnel for the bombs.
Leading up to the planned attack, Domingo called for another event similar to the October 2017 mass shooting in Las Vegas to give Americans “a taste of the terror they gladly spread all over the world,” the complaint states. Following an attack on Muslims in New Zealand on March 15, Domingo wrote in an online post, “there must be retribution,” according to the complaint.
On April 26, Domingo received what he thought was a live bomb, but in fact was an inert explosive device that was delivered by the undercover law enforcement officer. According to the criminal complaint, after receiving the bomb, Domingo drove his confederate and the undercover officer to Long Beach to scout the location Domingo planned to attack. While there, Domingo discussed finding the most crowded areas in order to kill the most people. Domingo was arrested shortly after returning from scouting the intended attack location.
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.
This matter is the product of an investigation by the FBI’s Joint Terrorism Task Force. JTTF members who participated in the investigation include the FBI, the Los Angeles Police Department, the Naval Criminal Investigative Service, the Los Angeles County Sheriff's Department, and the Long Beach Police Department.
This case is being prosecuted by Assistant United States Attorneys Reema M. El-Amamy and David T. Ryan of the Terrorism and Export Crimes Section at the United States Attorney’s Office for the Central District of California and Trial Attorney Ranganath Manthripragada of the Counterterrorism Section at the Department of Justice’s National Security Division.