Latest Records
Newest first across public DOJ and U.S. Attorney press releases.
27 June 2019
Greenfield Man Charged with Sexual Exploitation of ChildrenRead the Press Release
BOSTON - A Greenfield man was charged in federal court in Springfield yesterday with sexual exploitation of children and receipt of child pornography.
Charles Fox, 44, was charged with one count of sexual exploitation of children and one count of receipt of child pornography. Fox was arrested yesterday and appeared in federal court in Springfield. He was remanded to custody while the Judge takes the matter of detention under advisement.
According to the charging document, Fox induced a minor to engage in sexually explicit conduct for the purpose of producing an image or video of that conduct. It is also alleged that Fox received child pornography.
As a previously-convicted sex offender Fox faces a mandatory minimum sentence of 25 years and up to 50 years in prison, a lifetime of supervised release and a fine of $250,000. The charge of receipt of child pornography, carries a mandatory minimum sentence of 15 years and up to 40 years in prison, a lifetime of supervised release and a $250,000 fine. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling and Peter C. Fitzhugh, Special Agent in Charge of Homeland Security Investigations in Boston made the announcement today. Assistant U.S. Attorney Alex J. Grant of Lelling’s Springfield Branch Office is prosecuting the case.
The details contained in the charging documents are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Grand Jury Returns IndictmentsRead the Press Release
MADISON, WIS. -- A federal grand jury in the Western District of Wisconsin, sitting in Madison, returned the following indictments yesterday. You are advised that a charge is merely an accusation and that a defendant is presumed innocent until and unless proven guilty.
New York Woman Charged with Conspiracy & Causing the Introduction of Misbranded Drugs into Interstate Commerce
Ursula Wing, 41, New York City, is charged with conspiracy to defraud the United States and causing the introduction of misbranded drugs into interstate commerce. The indictment alleges that Wing illegally smuggled into the United States misbranded prescription drugs from India, which were not approved by the Food and Drug Administration (FDA) for distribution in the United States, and that she sold these misbranded prescription drugs to customers in the United States and around the world.
The indictment alleges that the prescription drugs sold by Wing were misbranded in that they were dispensed without a valid prescription from a practitioner licensed by law to administer such drugs, and that the labeling of the drugs lacked adequate directions for use by a lay person. The indictment alleges that Wing did not possess a valid wholesale drug distribution license, a valid pharmacy license, or a license to prescribe prescription drugs.
The indictment further alleges that Wing attempted to disguise the nature of her sale of prescription drugs by 1) creating a fake company called “Fatima’s Bead Basket,” which she listed as the shipper on the envelope going to the customer; 2) by inserting a necklace or other item of jewelry in the shipping envelope to serve as the cover piece of merchandise being mailed to the customer; 3) by packaging the misbranded drugs in a smaller packet that was in a hidden panel and taped to the inside of the shipping envelope; 4) by disguising the nature of the item being purchased by listing on the invoice alternate jewelry product names, each of which had a code to indicate the actual item being ordered; 5) by mailing these misbranded drugs from the United States to customers around the world, and falsely characterizing the exports on U.S. Customs forms as jewelry; and 6) by creating a fake online jewelry business for use as a cover for selling the misbranded drugs, allowing her clients to pay for the misbranded drugs using their credit cards, with the sales showing up on the merchant account as jewelry.
The indictment alleges that from June 2016 through June 2018, Wing conspired to defraud the United States by impeding lawful functions of federal law enforcement and regulatory agencies, and that from January 2018 through February 2018, Wing caused the introduction of unapproved, misbranded prescription drugs mifepristone and misoprostol into interstate commerce by sending the drugs from the state of New York to Wisconsin.
If convicted, Wing faces a maximum penalty of five years in federal prison on the conspiracy charge, and three years on the felony charge of causing the introduction of misbranded drugs into interstate commerce. The charges against Wing are the result of an investigation by the FDA Office of Criminal Investigations, U.S. Postal Inspection Service, U.S. Immigration and Customs Enforcement's Homeland Security Investigations, and IRS Criminal Investigation. The prosecution of this case is being handled by Assistant U.S. Attorney Daniel Graber.
Janesville Man Charged with Sex Trafficking of Minor
Corey Hereford, 47, Janesville, Wisconsin, is charged with recruiting an individual who was a minor and would be caused to engage in a commercial sex act. The indictment also charges him with committing this felony offense involving a minor while being required to register as a sex offender.
If convicted, Hereford faces a mandatory minimum penalty of 10 years in federal prison on the sex trafficking of a minor charge, and a mandatory consecutive 10 year sentence on the charge of committing a felony offense involving a minor while being required to register as a sex offender.
The charges against Hereford are the result of an investigation by the Janesville Police Department and the Wisconsin Department of Justice Division of Criminal Investigation. The prosecution of this case is being handled by Assistant U.S. Attorney Julie Pfluger.
Two Dane County Men Charged with Drug Crimes Involving Heroin, Fentanyl & Cocaine
Cortez Jackson, 39, Sun Prairie, Wisconsin, and Van Williamson, 42, Madison, Wisconsin, are charged with conspiring to distribute a mixture of heroin and fentanyl, and cocaine. The indictment alleges that the amount of the mixture of heroin and fentanyl involved in the conspiracy that was attributable to the defendants’ conduct is 40 grams or more, and that the conspiracy operated from February 2019 to June 6, 2019.
The indictment also charges Jackson with eight counts of distributing a mixture of heroin and fentanyl, with three of the counts also alleging the distribution of cocaine. The indictment further alleges that one of the counts involved the distribution of 40 grams or more of heroin and fentanyl. The indictment charges Williamson with one count of distributing heroin and fentanyl, as well as cocaine, and one count of distributing cocaine.
If convicted, Jackson and Williamson face a mandatory minimum five years and a maximum of 40 years in federal prison on the charges alleging 40 grams or more of heroin and fentanyl. Each of the distribution charges carry a maximum penalty of 20 years.
The charges against Jackson and Williamson are the result of an investigation by the Dane County Narcotics Task Force, Drug Enforcement Administration, and Sun Prairie Police Department. The prosecution of this case is being handled by Assistant U.S. Attorney David Reinhard.
La Crosse Man Charged with Distributing Methamphetamine
James A. Conner III, 43, La Crosse, Wisconsin, is charged with two counts of distributing methamphetamine, and one count of possessing 50 grams or more of methamphetamine with the intent to distribute. The indictment alleges that he distributed methamphetamine in December 2018 and January 2019, and that he possessed the methamphetamine on April 4, 2019.
If convicted, Conner faces a mandatory minimum penalty of five years and a maximum of 40 years in federal prison on the count alleging the possession of 50 grams or more of methamphetamine, and 20 years on each distribution charge. The charges against him are the result of an investigation by the La Crosse Police Department and Wisconsin Department of Justice Division of Criminal Investigation. The prosecution of this case is being handled by Special Assistant U.S. Attorney Chadwick Elgersma.
La Crosse Man Charged with Drug Crimes Involving 500 Grams of Methamphetamine
Andrew R. Henke, 35, La Crosse, Wisconsin, is charged with distributing methamphetamine, and possessing 500 grams or more of methamphetamine with the intent to distribute. The indictment alleges that he distributed and possessed methamphetamine on March 26, 2019.
If convicted, Henke faces a mandatory minimum penalty of 10 years and a maximum of life in federal prison on the charge alleging 500 grams or more of methamphetamine, and 20 years on the distribution charge. The charges against him are the result of an investigation by the La Crosse Police Department and Drug Enforcement Administration. The prosecution of this case is being handled by Assistant U.S. Attorney Corey Stephan.
Minnesota Man Charged with Possessing Methamphetamine With Intent to Distribute
William Huff, 54, South St. Paul, Minnesota, is charged with possessing 50 grams or more of methamphetamine with the intent to distribute. The indictment alleges that he possessed methamphetamine on April 20, 2019.
If convicted, Huff faces a mandatory minimum penalty of five years and a maximum of 40 years in federal prison. The charge against him is the result of an investigation by the Wisconsin Department of Justice Division of Criminal Investigation and Dunn County Sheriff’s Office. The prosecution of this case is being handled by Assistant U.S. Attorney Aaron Wegner.
Stevens Point Man Charged with Producing and Possessing Child Pornography
Nicholas Kvatek, 40, Stevens Point, Wisconsin, is charged with two counts of using a minor to engage in sexually explicit conduct for the purpose of producing a visual depiction of such conduct. The indictment alleges that he produced the child pornography in January 2019.
The indictment further charges Kvatek with possessing child pornography. The indictment alleges that on April 2, 2019, he possessed a cell phone containing child pornography, and that at least one of the depictions involved a minor who had not attained 12 years of age.
If convicted, Kvatek faces a mandatory minimum sentence of 15 years and a maximum of 40 years in federal prison on the production charges, and a maximum of 20 years on the possession charge. The charges against him are the result of an investigation by the Stevens Point Police Department and Portage County Sheriff’s Office. The prosecution of the case is being handled by Assistant U.S. Attorney Elizabeth Altman.
Glastonbury Man Sentenced to More Than 12 Years in Federal Prison for Child Exploitation OffensesRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that JAMES RIPBERGER, 63, of Glastonbury, was sentenced today by U.S. District Judge Victor A. Bolden in Bridgeport to 150 months of imprisonment, followed by 10 years of supervised release, for child exploitation offenses.
According to court documents and statements made in court, on October 12, 2017, law enforcement officers conducted a search of Ripberger’s Glastonbury residence and seized computers and electronic storage devices. Analysis of the seized items revealed more than 2,200 images and videos of child pornography, more than 17,000 images of child erotica, and multiple images and videos of a minor victim who Ripberger surreptitiously recorded in various states of undress.
Ripberger has been detained since December 15, 2017, when he was arrested on a federal criminal complaint. On January 16, 2019, he pleaded guilty to one count of receipt of child pornography.
This investigation was conducted by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), the Glastonbury Police Department and the Connecticut Center for Digital Investigations. The case was prosecuted by Assistant U.S. Attorney Nancy V. Gifford.
This prosecution is part of the U.S. Department of Justice’s Project Safe Childhood Initiative, which is aimed at protecting children from sexual abuse and exploitation. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
To report cases of child exploitation, please visit www.cybertipline.com.
Former Senior Official Pleads Guilty to Stealing Government MoneyRead the Press Release
ALEXANDRIA, Va. – An Alexandria man pleaded guilty today to stealing over $40,000 in government money during 2018, while he was employed as a senior government official at the U.S. Agency for Global Media (USAGM) in Washington, D.C.
According to court documents, Haroon K. Ullah, 41, admitted that he fraudulently obtained thousands of dollars in government funds by submitting falsified hotel invoices, falsified and inflated taxi and Uber receipts, and by billing the government for personal travel and for travel that had already been paid by third parties.
Additionally, Ullah admitted that he created a falsified letter from a real medical doctor purportedly claiming that Ullah needed to fly in business class at government expense because of a sore knee. By submitting the forged letter from the doctor, Ullah fraudulently obtained costly business class upgrades at government expense, including on lengthy international flights. Ullah admitted to creating many of the false documents on his government-issued laptop computer. As part of the plea, Ullah also admitted that he submitted falsified invoices and repair estimates to an insurance company regarding a claim for repairs to his home in Alexandria.
A former employee of the U.S. Department of State, Ullah became a member of the Senior Executive Service when he joined USAGM as its Chief Strategy Officer (CSO). Ullah committed his crime from February through October 2018, while serving as CSO. Ullah is no longer employed with USAGM.
Ullah pleaded guilty to theft of government money and faces a maximum penalty of 10 years in prison when sentenced on October 11. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Steve A. Linick, Inspector General for the Department of State, made the announcement after U.S. District Judge T.S. Ellis, III, accepted the plea. Special Assistant U.S. Attorney Russell L. Carlberg is prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:19-cr-183.
Former Port Huron Pharmacist Pleaded Guilty to Fraudulently Obtaining Powerful PainkillersRead the Press Release
Kyle Wilhelm, 40, a former pharmacist, pleaded guilty yesterday to obtaining controlled substances, including opioids, by fraud U.S. Attorney Matthew Schneider announced today.
Schneider was joined in the announcement by Acting Special Agent in Charge Keith Martin of the Drug Enforcement Administration, Detroit Field Division.
Wilhelm pleaded guilty before United States District Judge Mark A. Goldsmith and is scheduled to be sentenced on October 2, 2019.
According to the plea agreement, between February 2015 and February 2018, Wilhelm utilized his position as a hospital pharmacy manager to fill prescriptions for fictitious patients using false birthdates, false addresses, and by the unauthorized use of a medical doctor’s DEA registration number. He failed to compensate his employer for more than $35,000 in controlled substances he fraudulently obtained. In total, he obtained more than 200,000 dosage units of controlled substances such as oxycodone, hydromorphone, and hydrocodone acetaminophen.
Wilhelm faces a maximum sentence of imprisonment of eight years, and a maximum fine of $250,000.
The case was investigated by DEA’s Tactical Diversion Squad. The case is being prosecuted by Assistant U.S. Attorney Philip A. Ross
Former Massachusetts Man Pleads Guilty to IRS Fraud SchemeRead the Press Release
BOSTON – An Illinois man, who previously lived in Massachusetts, pleaded guilty yesterday in federal court in Worcester to charges associated with a wire fraud scheme whereby victims were told they owed money to the Internal Revenue Service (IRS).
Ashokkumar Patel, a/k/a Andy Patel, 30, of Hoffman Estates, Ill., and formerly of Worcester and Plainville, Mass., pleaded guilty to one count of conspiracy to commit wire fraud, two counts of wire fraud and one count of money laundering. Sentencing is scheduled for Sept. 23, 2019. In June 2017, Patel was arrested and charged. He was released from custody on conditions.
From December 2013 to October 2014, Patel was part of a conspiracy whereby victims in the United States were contacted by individuals, primarily in India, and falsely told that they owed money to the IRS. The victims were told that in order to avoid imminent arrest, they had to purchase MoneyPak, or other types of prepaid stored value cards, load thousands of dollars onto the cards, and provide the serial numbers to the callers. After doing so, the victims’ money was quickly transferred to a prepaid debit card, such as Green Dot Debit Cards, which were then used to purchase money orders. Patel was responsible for purchasing the prepaid debit cards, using them to purchase money orders and then depositing the purchased money orders into various bank accounts, including his own.
The charges of conspiracy to commit wire fraud and wire fraud each provide for a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $250,000. The charge of money laundering provides for a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $500,000, or twice the value of the property involved in the transaction. 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 Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement today. Assistant U.S. Attorney Michelle L. Dineen Jerrett of Lelling’s Worcester Branch Office is prosecuting the case.
Former HUD Assistant Inspector General Indicted for Concealing Procurement Fraud SchemeRead the Press Release
A seven-count indictment was returned yesterday charging a former Assistant Inspector General for the U.S. Department of Housing and Urban Development, Office of Inspector General, with engaging in a scheme to conceal material facts, making false statements and falsification of records.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, Acting Assistant Director in Charge John P. Selleck of the FBI’s Washington Field Office and Michael K. Atkinson, Inspector General of the Intelligence Community made the announcement.
According to the indictment, between early 2012 and mid-2016, Eghbal “Eddie” Saffarinia engaged in a scheme to conceal material facts, including the nature and extent of Saffarinia’s financial relationship with a personal friend who was the owner and chief executive officer of an information technology company in Virginia. During a period in which Saffarinia received payments and loans from his friend totaling $80,000, Saffarinia disclosed confidential internal government information to his friend and undertook efforts to steer government contracts and provide competitive advantages and preferential treatment to his friend’s company. Saffarinia also failed to disclose this financial relationship and another large promissory note on his public financial disclosure forms.
The case is being investigated by the FBI’s Washington Field Office and the Office of the Inspector General of the Intelligence Community. Trial Attorneys Edward P. Sullivan and Rosaleen T. O’Gara of the Criminal Division’s Public Integrity Section are prosecuting the case.
An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Former Financial Services Executive Pleads Guilty to Rigging Bids for Financial Instruments in Violation of Antitrust LawRead the Press Release
Larry D. Meyers, the former head of the securities lending desk at Banca IMI Securities Corp., pleaded guilty to a criminal antitrust charge for his involvement in a bid-rigging conspiracy for certain financial instruments, the Department of Justice announced.
Meyers admitted that, from at least as early March 2012 until at least August 2014, he and his counterparts at other broker-dealers conspired to submit rigged bids to borrow pre-release American Depository Receipts (ADRs). Meyers’ plea is the third in the ongoing investigation; Banca IMI and Industrial and Commercial Bank of China Financial Services LLC previously pleaded guilty on May 10, 2019, and June 14, 2019, respectively.
Worldwide, thousands of publicly traded companies list their shares of common stock only on foreign stock exchanges. Most U.S. investors are unable to purchase or sell such foreign shares. The U.S. Securities and Exchange Commission, however, permits four U.S. depository banks to create ADRs, which represent foreign ordinary shares and can be traded in the United States. Through the purchase and sale of ADRs, U.S. investors are able to gain exposure to — including the ability to receive dividends from — companies whose common stock is listed only on foreign exchanges.
Meyers pleaded guilty to conspiring to borrow pre-release ADRs from U.S. depository banks at artificially suppressed rates. During the conspiracy, a U.S. depository bank began using an auction-style process for pre-release ADRs and invited Banca IMI and other broker-dealers to submit competitive bids for rates to borrow ADRs. In response, Meyers and his co-conspirators intensified their coordination in an effort to artificially increase their profits under the auction-style process. On at least 30 occasions, Banca IMI reached an agreement with one or more co-conspirators as to the bids they would submit to U.S. depository banks. On many occasions, the conspirators agreed that they all would submit the same bid. Meyers and his co-conspirators reached these agreements using, among other means, private chat rooms and text messages.
“The guilty plea announced today represents the commitment of the Division and its law enforcement partners to hold accountable for market-corrupting collusion not just the companies that benefit from that unlawful activity, but also the executives who carry it out,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division.
“This guilty plea highlights just how thorough FBI investigations truly are,” said Assistant Director Robert Johnson of the FBI’s Criminal Investigative Division. “Individuals engaged in corrupt activity cannot expect to hide behind their companies. The FBI is committed to pursuing all those who use criminal means to enrich themselves at the expense of U.S. investors.”
“The FBI is committed to investigating companies and executives when they operate outside the law and attempt to play by different rules in the marketplace,” Charles A. Dayoub, Acting Special Agent in Charge of the Criminal Division at the FBI’s Washington Field Office. “I would like to thank the dedicated FBI agents and analysts who have worked on this investigation and are committed to holding those accountable who ignore the rule of law in the United States.”
A criminal violation of Section 1 of the Sherman Act carries a maximum term of imprisonment of 10 years and a maximum fine of $1 million for individuals. The fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
The Washington Criminal II Section of the Antitrust Division and the FBI’s International Corruption Squad in Washington, D.C., are conducting the investigation into bid rigging in the market for pre-release ADRs. Anyone with information in connection with this investigation is urged to call the Antitrust Division’s Washington Criminal II Section at 202-598-4000 or visit www.justice.gov/atr/contact/newcase.html.
Former Equifax employee sentenced for insider tradingRead the Press Release
ATLANTA - Jun Ying, the former Chief Information Officer of Equifax U.S. Information Solutions, has been sentenced to federal prison for insider trading.
“Ying thought of his own financial gain before the millions of people exposed in this data breach even knew they were victims,” said U.S. Attorney Byung J. “BJay” Pak. “He abused the trust placed in him and the senior position he held to profit from inside information.”
“If company insiders don’t follow the rules that govern all investors, they will face the consequences for their actions. Otherwise the public’s trust in the stock market will erode,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “The FBI will do everything in its power to stop anyone who takes unfair advantage of their insider knowledge.”
According to U.S. Attorney Pak, the charges and other information presented in court: Equifax Inc. is a consumer credit reporting agency headquartered in Atlanta, Georgia. During the summer of 2017, Equifax was the victim of a data breach, where hackers acquired names, Social Security numbers, birth dates, and addresses of over 145 million Americans. At the time, Jun Ying was the Chief Information Officer of Equifax U.S. Information Solutions. In that role, he was provided sensitive information that led him to conclude that Equifax was the victim of the data breach before it was made public.
On Friday, August 25, 2017, Ying texted a co-worker that the breach they were working on “sounds bad. We may be the one breached.” The following Monday, Ying conducted web searches on the impact of Experian's 2015 data breach on its stock price. Later that morning, Ying exercised all of his stock options, resulting in him receiving 6,815 shares of Equifax stock, which he then sold. He received proceeds of over $950,000, and realized a gain of over $480,000, thereby avoiding a loss of over $117,000. On September 7, 2017, Equifax publicly announced its data breach, which resulted in its stock price falling.
Jun Ying, 44, of Atlanta, Georgia, was sentenced to four months in prison to be followed by one year of supervised release, ordered to pay restitution in the amount of $117,117.61, and fined $55,000. Ying was convicted on these charges on March 7, 2019, after he pleaded guilty.
Ying is the second Equifax employee found guilty of insider trading relating to the data breach, following Sudhakar Reddy Bonthu, a former manager at Equifax, who pleaded guilty on July 23, 2018.
This case was investigated by the Federal Bureau of Investigation. The U.S. Securities and Exchange Commission contributed to the case.
Assistant U.S. Attorney Christopher J. Huber, Deputy Chief of the Complex Frauds Section, and former Assistant U.S. Attorney Lynsey M. Barron prosecuted the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Former Border Patrol Agent Pleads Guilty to Distribution, Receipt and Possession of Child PornographyRead the Press Release
SYRACUSE, NEW YORK – Keith E. Hook, age 55, of Oswego, New York, pled guilty today to distributing, receiving and possessing child pornography, announced United States Attorney Grant C. Jaquith and Kevin Kelly, Special Agent in Charge of the Buffalo Field Office of Homeland Security Investigations (HSI).
United States Attorney Grant C. Jaquith stated: “It is a sad day when a federal agent sworn to protect the public violates that duty in such a profound way. Former Border Patrol Agent Hook exploited the most vulnerable members of our community, our children, by trading child pornography both on and off duty. Thanks to the hard work of our law enforcement partners, Hook will now be held fully accountable for his despicable conduct.”
HSI Special Agent in Charge Kevin Kelly stated: “The actions of an individual officer sworn to protect the public should in no way tarnish the excellent reputation of the overwhelming majority of those who wear the badge. This case should however demonstrate that HSI will hold accountable all of those involved in these crimes, regardless of the position they hold in the community.”
In entering his guilty plea today in United States District Court, Hook, formerly a Border Patrol Agent, admitted that he used the Kik Messenger application to distribute and receive child pornography from other Kik users from January 2018 through July 2018. Hook, using his iPod Touch, traded images of child pornography using a Wifi connection both at his home and while on duty at the Oswego Port of Entry. Forensic analysis of Hook’s iPod revealed that at the time of his arrest he possessed on his iPod 138 images and 4 video files depicting minors engaged in sexually explicit conduct. In addition to those images, Hook also had 10 video files and over 200 image files saved in his iCloud storage account and another 3 images stored on his laptop computer. The images and videos included depictions of the rape and sodomy of prepubescent children and toddlers.
United States District Judge David N. Hurd will sentence Hook on October 24, 2019. He faces at least 5 years and up to 20 years in prison for the distribution and receipt charges and up to 20 years in prison on the possession charge; a term of post-release supervision of at least 5 years and up to life; and a fine of up to $250,000. Hook will also be required to register as a sex offender.
This case is being investigated by HSI Syracuse with assistance from Department of Homeland Security Office of Inspector General, U.S. Customs and Border Protection Office of Professional Responsibility, New York State Police Computer Crimes Unit, and the New York State Police-Troop D, and is being prosecuted by Assistant U.S. Attorney Geoffrey J. L. Brown.
This case is being prosecuted as part of Project Safe Childhood. Launched in May 2006 by the Department of Justice, Project Safe Childhood is led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), and is designed to marshal federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit https://www.justice.gov/psc.
Florida Man Pleads Guilty to Wire Fraud ConspiracyRead the Press Release
BOSTON – A Florida man pleaded guilty yesterday in federal court in Boston in connection with the fraudulent abuse of the U.S. Postal Service’s (USPS) Informed Delivery electronic notification system.
Kevens Louis, 26, of Plantation, Fla., pleaded guilty to one count of conspiracy to commit wire fraud and one count of aggravated identity theft. Sentencing is scheduled for Sept. 26, 2019. Louis and his co-conspirators, Fred Alcius, Lucson Appolon, and Peter Belony were charged with conspiracy to commit wire fraud on April 9, 2019. Co-conspirators Appolon and Louis were arrested on April 16, 2019. Belony was arrested on April 26, 2019 and pleaded guilty on June 14, 2019. Alcius remains a fugitive.
Informed Delivery is a free electronic notification service provided by the USPS that gives residential and P.O. Box customers the ability to digitally preview their incoming mail and manage their packages.
According to the indictment, the defendants accessed victims’ personal identifying information, including names, Social Security numbers, dates of birth, and addresses on the “dark web” and then used the information to open credit cards in the victims’ names. The defendants then subscribed to Informed Delivery using the victims’ personal identifying information and a fraudulent email address created to track the delivery of credit cards to the victims’ residential mailboxes. The defendants subsequently intercepted the credit cards at the victims’ mailboxes before the victims could receive them and used those credit cards at ATMs and to purchase gift cards and other items for resale at Apple and Walmart, among other retail establishments. The defendants traveled to states across the East Coast in furtherance of the fraud, including New Hampshire, Maine, and Massachusetts.
The charge of conspiracy to commit wire fraud carries a sentence of no greater than 20 years in prison, up to three years of supervised release, and a fine of up to $250,000. The charge of aggravated identity theft carries a mandatory minimum sentence of two years in prison, to be served consecutive to any other sentence imposed, one year of supervised release, and a fine of up to $250,000. 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 Joseph W. Cronin, Inspector in Charge of the U.S. Postal Inspection Service, made the announcement today. Valuable assistance was provided by the Federal Bureau of Investigation, Boston Field Office; Homeland Security Investigations in Boston; the Concord, Fort Lauderdale (Fla.), Harvard, Kittery (Maine), Norfolk, Plantation (Fla.), Sherborn, and Weston Police Departments. Assistant U.S. Attorney Mackenzie A. Queenin of Lelling’s Cybercrime Unit is prosecuting the case.
The details contained in the indictment are allegations. The remaining defendants are presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Five Dominican Nationals Arrested for Identity TheftRead the Press Release
BOSTON – Five Dominican nationals were charged in federal court in Boston as a result of a federal investigation targeting offenders of document and benefit fraud. The defendants have allegedly used the identities of U.S. Citizens from Puerto Rico as their own. All five defendants have been previously arrested on drug charges under the names of the victims whose identities they have stolen.
The following individuals have each been charged with aggravated identity theft and false representation of a Social Security number:
- Jesus Ernesto Barbosa Pimental, 54, a Dominican national residing in South Boston. According to court records, Barbosa Pimental obtained a Massachusetts identity card in the name of a U.S. citizen.
- Edward Obispo Garcia, 38, a Dominican national residing in Roxbury. It is alleged that Obispo Garcia obtained a Massachusetts driver’s license in the name of a U.S. citizen.
- Juan Jose Heureaux Carmona, 27, a Dominican national residing in Roxbury. It is alleged that Heureaux Carmona obtained a Massachusetts ID card in the name of a U.S. citizen.
- Jose Narciso Rosario Maria, 47, a Dominican national residing in Boston. According to court documents, Rosario Maria obtained a Massachusetts driver’s license in the name of a U.S. citizen.
- Jesus Alberto Baez Pimental, 37, a Dominican national residing in Fitchburg. It is alleged that Baez Pimental obtained a Massachusetts driver’s license in the name of a U.S. citizen, and MassHealth records reflect an application for health benefits under this same name.
The investigation was conducted by Homeland Security Investigation’s Document and Benefit Fraud Task Force (DBFTF), a specialized field investigative group comprised of personnel from various local, state, and federal agencies with expertise in detecting, deterring, and disrupting organizations and individuals involved in various types of document, identity, and benefit fraud schemes.
The DBFTF is currently investigating suspected aliens who are believed to have obtained stolen identities of United States citizens born in Puerto Rico. The DBFTF has investigated individuals who have used stolen identities to obtain public benefits which they would not otherwise be eligible to receive, including Massachusetts Registry of Motor Vehicles identity documents, Social Security numbers, MassHealth benefits, public housing benefits, and/or unemployment benefits.
In July 2018, a DBFTF-led investigation resulted in the arrests of 25 individuals on charges of identity theft and Social Security fraud, and in April 2019, a separate DBFTF-led investigation resulted in 11 additional arrests.
The charge of aggravated identity theft carries a mandatory two-year prison sentence that must run consecutively to any other sentence imposed, up to one year of supervised release, and a fine of up to $250,000. False representation of a Social Security number provides for a sentence of up to five years in prison, three years of supervised release and a fine of $250,000. Sentences are imposed by a federal district court judge based on the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling; Peter C. Fitzhugh, Special Agent in Charge of Homeland Security Investigations in Boston; and Phillip M. Coyne, Special Agent in Charge of the U.S. Department of Health & Human Services, Office of Inspector General, made the announcement today. Valuable assistance was provided by the Social Security Administration, Office of Inspector General, Office of Investigations, Boston Field Division; U.S. Department of Housing and Urban Development, Office of Inspector General, Northeast Regional Office; U.S. Department of Labor, Office of Inspector General, Office of Investigations; U.S. Department of State, Diplomatic Security Service, Boston Field Office; U.S. Postal Inspection Service; U.S. Immigration and Customs Enforcement’s Enforcement and Removal Operations, Boston; U.S. Citizenship and Immigration Services, District 1; HSI Country Attaché Santo Domingo, Dominican Republic; HSI Santo Domingo Transnational Criminal Investigative Unit; and the Massachusetts State Police. Assistant U.S. Attorney David Tobin and Special Assistant U.S. Attorney Karen Burzycki of Lelling’s Major Crimes Unit are prosecuting the cases.
The details contained in the charging documents are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Firearms violations sends Miles City man to prisonRead the Press Release
BILLINGS—A Miles City man who admitted possessing stolen and shortened firearms in Billings and Miles City was sentenced today to 45 months in prison and three years of supervised release, said U.S. Attorney Kurt Alme said.
Chet Joseph Leatherberry, 35, pleaded guilty in February to possession of stolen firearms and to possession of unregistered firearms.
U.S. District Judge Susan P. Watters presided.
The prosecution said Leatherberry violated firearms laws through a series of offenses. In December 2016, Leatherberry possessed a stolen .380-caliber pistol in Billings. Yellowstone County sheriff’s deputies found the pistol next to Leatherberry’s bed while serving a search warrant on his residence for stolen goods. During the search, officers also found stolen electronic equipment, methamphetamine and drug paraphernalia. Leatherberry told officer that he took the pistol from two people who wanted to sell it, had a few potential buyers and thought it was stolen. The pistol’s lawful owner lives in Bozeman and didn’t realize the gun was gone until he was called by law enforcement.
Leatherberry also admitted that he possessed three modified or shortened firearms in Miles City in July 2018 and additionally possessed two stolen pistols a month later. When arrested on an outstanding warrant in August 2018, Leatherberry told Miles City law enforcement that he had two handguns in a backpack at the time of his arrest. The investigation found that both of the handguns were loaded and had been stolen.
Assistant U.S. Attorney Paulette Stewart prosecuted the case, which was investigated by the Yellowstone County Sheriff’s Office, Billings Police Department, Miles City Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
The case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
XXX
Federal Jury Convicts Former Honolulu Prosecutor Katherine Kealoha, Former Police Chief Louis Kealoha and Two Police Officers of CorruptionRead the Press Release
Special Attorneys Michael Wheat (619) 546-8437, Joseph Orabona (619) 546-7951, Janaki Gandhi (619 546-8817) and Colin McDonald (619) 546-9144
HONOLULU, Hawaii – A federal jury has found former Honolulu Deputy Prosecutor Katherine Kealoha and her husband, former Honolulu Police Chief Louis Kealoha, guilty of abusing their power by conspiring with two police officers to frame her uncle for a crime he did not commit in a desperate attempt to discredit his claim that the Kealohas stole a substantial amount of money from him and his mother.
Following a six-week trial that included testimony of 70 witnesses, the jury deliberated for one day and convicted the Honolulu power couple and police officers Derek Hahn and Minh-Hung “Bobby” Nguyen of conspiracy and three counts of attempted obstruction of an official proceeding. The jury found that the officers helped the Kealohas facilitate the set up and cover up involving the uncle, Gerard Puana.
“The Kealohas’ extraordinary greed inspired astonishing corruption,” said U.S. Attorney Robert Brewer. “The audacity of this couple to use the power vested in them as law enforcement officials to fund a lavish lifestyle and satisfy their personal vendettas was unconscionable. These two were supposed to be the good guys. They were supposed to enforce the law - not break it. Instead, they broke the community’s faith in a monumental way. This city has been harmed by their deception and greed, but the jury has spoken, and it has loudly said NO to corruption. NO to abuse of power. NO to special treatment. NO to injustice.”
“Unfortunately there are no winners in this case,” said FBI Acting Special Agent in Charge Rafael A. Riviere. “The betrayal of trust by the former prosecutor and former Chief of Police will linger for some time. However, justice has been served and the jury, through this verdict, has said that no one is above the law and this behavior will not be tolerated in the State of Hawaii. The FBI would like to thank the United States Attorney Office (USAO) Hawaii, USAO for the Southern District of California, as well as the men and woman of the jury for their swift and decisive verdict.”
During trial, the prosecution relied on current and former police officials, federal agents, victims Gerald and Florence Puana, experts, city and county officials, defense attorneys, and Puana family members, among others, as witnesses to prove the story of corruption, abuse of power, greed and manipulation.
The financial entanglement with the uncle started back in 2007, when Katherine Kealoha told her uncle she would safeguard and invest his substantial savings in an her alleged hui. To give the false appearance of investment returns, she periodically withdrew cash from the bank account holding the uncle’s money and paid the money as a “return” on his investment. Despite his requests, Katherine Kealoha never returned over $70,000 of his investment principal.
In 2009, another financial opportunity arose and Katherine Kealoha seized the moment to insert herself by advising her grandmother, Florence Puana, on how to help her son (the same uncle who had invested money with Katherine Kealoha) purchase a condominium despite his lack of credit. Katherine Kealoha’s solution was a convoluted five-step process: (1) the grandmother would obtain a reverse mortgage; (2) Katherine Kealoha would use the proceeds to buy the condo outright; (3) the Kealohas would use the remaining funds to “consolidate” their debts (thereby allowing them to improve their credit); (4) the Kealohas would obtain a mortgage on the condo and the uncle would make mortgage payments to them; and (5) the Kealohas would repay the reverse mortgage within three to six months.
The grandmother agreed to Katherine Kealoha’s plan, and obtained a reverse mortgage totaling more than $513,000. A portion of the funds was used to purchase a condo; the remainder, approximately $153,000, was supposed to be used to consolidate the Kealohas debts in order for the Kealohas’ to obtain a mortgage on the condo. However, Katherine Kealoha kept none of her promises. Instead, she spent the entire amount within six months for her and her husband’s lavish lifestyle. Katherine never obtained a mortgage on the condo; however, she collected mortgage payments from her uncle and again pocketed most of his money. Lastly, she did not repay the reverse mortgage which continued to substantially increase and diminish the equity in grandmother’s family home. The grandmother and uncle’s discovery of this skyrocketing loan balance led to a confrontation with the Katherine Kealoha, and their subsequent civil lawsuit. This dispute motivated the Kealohas to frame the uncle for the mailbox theft, have the grandmother declared incompetent, and discredit both the uncle and grandmother in the civil case.
The Kealohas used the grandmother’s stolen money to pay a variety of personal expenses, including their mortgage and tens of thousands of dollars in bank loans; car payments for a Mercedes and a Maserati; Elton John concert tickets; travel expenses, restaurant meals and a trip to Disneyland; donations to charity; and a $23,000 brunch tab at the Sheraton Waikiki to celebrate Louis Kealoha’s induction as Honolulu Police Chief in 2009.
The uncle and grandmother suspected they had been duped and began to voice their concerns and seek legal remedies by filing a civil lawsuit, accusing the Kealohas of stealing their money. The Kealohas sought to discredit the Puanas and orchestrated an elaborate cover up that involved falsely portraying the uncle as a drug-addicted criminal, and the grandmother as an incompetent senior who needed a financial guardian. To protect their public images and conceal their greed, the Kealohas and two police officers from the elite Criminal Intelligence Unit framed the uncle for stealing the Kealohas’ mailbox, supposedly to obtain bank statements from a joint account held by Katherine Kealoha and her grandmother - statements that were relevant to the civil lawsuit. The alleged theft sparked a police investigation and federal prosecution that resulted in a mistrial against the uncle. The idea was to discredit the uncle by giving him a felony conviction so that the civil jury would never believe his testimony.
The mistrial in the uncle’s federal case resulted in an FBI investigation into the civil rights violations of the uncle. During the FBI investigation, the Kealohas and the two police officers continued to engage in a conspiracy to obstruct the FBI and the federal grand jury seeking to uncover the truth behind this set up and cover up. This led to their indictment in October 2017.
Today, the jury found that the Kealohas used their considerable power plus members of the police department’s elite Criminal Intelligence Unit to frame him for that bogus theft of their mailbox on June 21, 2013. The evidence demonstrated that the defendants staged the “theft,” then selectively edited the grainy surveillance video to conceal their preparation of the mailbox for the taking, falsely identified Gerard Puana as the culprit captured by the video, falsified police reports, withheld or failed to investigate critical evidence, and lied to federal investigators and prosecutors to frame the uncle. The defendants were also involved in the destruction of surveillance footage contained on hard drives from the case by recording over it with six days of a ceiling and office space at police headquarters. At one point, the Kealohas assigned approximately 30 Honolulu police officers to conduct 24-hour surveillance on Gerard Puana.
But according to key evidence presented by the prosecution, the Puanas had no motive to steal a mailbox to obtain bank statements. The evidence showed they had already obtained the bank statements in question in February of 2013 – four months prior to the mailbox theft on June 21, 2013. Katherine Kealoha knew that she had closed that joint bank account on January 24, 2013, and the last statement was mailed to Katherine’s post office box in Kahala in February 2013 – not to her residence where the mailbox was stolen.
“As we’ve often seen, the cover up was worse than the original crime,” U.S. Attorney Brewer said. “The most troubling aspect of this case was the way these powerful defendants manipulated the justice system for their own purposes.”
An indignant Katherine Kealoha responded to the accusations of her financial fraud in a letter to her grandmother that prosecutors presented to the jury as a roadmap to her motives:
I WILL seek the highest form of legal retribution against ANYONE and EVERYONE who has written or verbally uttered those LIES about me! They will rue the day that they decided to state these TWISTED LIES!
The jury found that Katherine Kealoha made good on that promise.
Chief U.S. District Judge J. Michael Seabright of the District of Hawaii, who presided over the trial, set sentencing for Katherine Kealoha on October 7, 2019 at 1:30 p.m.; Louis Kealoha on October 15, 2019 at 2:15 p.m.; Derek Hahn on October 21, 2013 at 1:30 p.m.; and Minh-Hung “Bobby” Nguyen on October 28, 2019 at 1:30 p.m.
During the hearing, the prosecution moved to remand Katherine Kealoha. The judge scheduled a detention hearing for June 28, 2019 at 10 a.m. The other defendants were allowed to remain free until sentencing.
The Kealohas are facing a second trial on October 21, 2019 on charges of bank fraud, aggravated identity theft, and obstruction of justice in connection with the alleged theft of a $167,000 inheritance of two children for whom Katherine Kealoha served as financial guardian. Katherine Kealoha also faces charges related to allegations that she and her brother, Rudolph Puana, trafficked in opioids and that Kealoha used her position as a Deputy Prosecutor to hide it.
U.S. Attorney Brewer praised prosecutors Michael Wheat, Joseph Orabona, Colin McDonald, Janaki Gandhi, former prosecutor Eric Beste and FBI agents in Honolulu for their excellent work on this case.
DEFENDANTS Case Number 17cr0582-JMS
Katherine P. Kealoha Age: 48 Honolulu, Hawaii
Louis M. Kealoha Age: 58 Honolulu, Hawaii
Derek Wayne Hahn Age: 47 Honolulu, HI
Minh-Hung “Bobby” Nguyen Age: 45 Kaneohe, Hawaii
SUMMARY OF CHARGES
Count 1
Conspiracy to Commit Offenses Against the United States – Title 18, U.S.C., Section 371
Maximum penalty: Five years imprisonment, $250,000 fine
Guilty – Katherine P. Kealoha, Louis M. Kealoha, Derek Wayne Hahn, Minh-Hung “Bobby” Nguyen
Counts 2, 6 and 8
Obstruction of Official Proceeding – Title 18, U.S.C., Section 1512 (c)
Maximum penalty: Twenty years’ imprisonment, $250,000 fine
Guilty – Katherine P. Kealoha (Counts 2, 6, 8); Louis M. Kealoha (Counts 2, 6, 8); Derek Wayne Hahn (Counts 2, 6, 8); Minh-Hung “Bobby” Nguyen (Counts 2, 6, 8)
AGENCY
Federal Bureau of Investigation
Honolulu, Portland, and San Diego Divisions
Federal Judge Finds Davenport Man Guilty of Distributing Fentanyl to a Drug User Resulting in His DeathRead the Press Release
DAVENPORT, IA- On Wednesday, June 26, 2019, the Honorable Stephanie M. Rose, United States District Court Judge for the Southern District of Iowa, found Jonas Ross, III, age 38, of Davenport, guilty of one count of distribution of a controlled substance resulting in death.
Beginning on May 4, 2019, a bench trial was held before Judge Rose. The evidence showed the victim, who was familiar with Ross, had traveled to Davenport from Ohio on or about November 30, 2017, and checked into the Days Inn on Northwest Boulevard. The victim had contacted Ross to obtain heroin. On December 2, 2017, the victim’s body was discovered in his motel room. Forensic evidence revealed the victim had overdosed and died from ingesting fentanyl. The police recovered heroin, fentanyl, and furanyl-fentanyl in the victim’s room.
Ross had previously entered guilty pleas to three counts of distribution of heroin, some of which contained fentanyl and acryl-fentanyl. The defendant faces a maximum sentence of 30 years each for the three counts of distribution of heroin and a mandatory life sentence for distribution of a controlled substance resulting in death. Sentencing is presently scheduled for October 29, 2019 at 3:00 p.m.
The investigation was conducted by the City of Davenport Police Department, Iowa Division of Criminal Investigation, and the Iowa State Medical Examiner’s Office. This case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa.
Federal Inmate Sentenced to 15 More Months in Prison for Possessing BuprenorphineRead the Press Release
JOHNSTOWN, Pa. – An inmate at the Federal Correctional Institution in Loretto, Pa., pleaded guilty in federal court in Johnstown to a charge of possession of a prohibited object in prison, and immediately following, was sentenced to 15 months in prison, consecutive to the current prison term he is serving, and three years’ supervised release, United States Attorney Scott W. Brady announced today.
Ryan S. Harris, 36, pleaded guilty to the indictment before United States District Judge Kim R. Gibson.
In connection with the guilty plea, on September 28, 2018, Harris possessed a quantity of Buprenorphine.
Assistant United States Attorney Arnold P. Bernard, Jr. prosecuted this case on behalf of the government.
Mr. Brady commended the Laurel Highlands Resident Agency of the Federal Bureau of Investigation and the Federal Correctional Institution, Special Investigative Staff, for the investigation leading to the successful prosecution of Harris.
Executive Director and CEO of Sponsor Organization Sentenced to 10 Years’ Imprisonment, and Owner of Catering Company Sentenced to 8 Years’ Imprisonment, for Their Roles in $26 Million Scheme to Defraud Federal Food Program for Underprivileged ChildrenRead the Press Release
The former executive director and CEO of a sponsor organization for the federally-funded Child Care Food Program (“CCFP”) and the former owner of a catering company that was awarded contracts to provide nutritious food for needy children were sentenced today for their roles in a complex fraud, kickback, bribery, and money laundering scheme that victimized the CCFP and the children it was meant to serve.
Ariana Fajardo Orshan, U.S. Attorney for the Southern District of Florida, Michael J. De Palma, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), Brian Swain, Special Agent in Charge, U.S. Secret Service (USSS), Miami Field Office, Karen Citizen-Wilcox, Special Agent in Charge, U.S. Department of Agriculture (USDA), and Rick Maglione, Chief, Fort Lauderdale Police Department, made the announcement.
Sandra Ruballo, 47, of Davie, Florida, was sentenced to 120 months in prison followed by three years of supervised release. Ruballo was also ordered to pay a $900 special assessment, restitution, and a forfeiture money judgment of $26 million. Carlos Andres Montoya, 48, of Miramar, Florida, was sentenced to 97 months in prison followed by three years of supervised release. Montoya was also ordered to pay a $200 special assessment, restitution, and a forfeiture money judgment of $13 million.
For more than six years, Ruballo and Montoya defrauded the federally funded Child Care Food Program, which provides free and reduced meals to underprivileged children at hundreds of daycare centers in Florida. As part of the scheme, the conspirators falsified paperwork, entered into various kickback arrangements, manipulated the catering contract bid process, and inflated annual budgets, all in order to receive millions of dollars of falsely and fraudulently obtained federal funds for their own personal use and benefit.
On February 27, 2019, Ruballo pleaded guilty, without a plea agreement, to all counts of the superseding indictment, including: one count of conspiracy to commit wire fraud, in violation of Title 18, United States Code, Section 1349; three counts of wire fraud, in violation of Title 18, United States Code, Section 1343; one count of conspiracy to commit money laundering, in violation of Title 18, United States Code, Section 1956(h); and four counts of money laundering, in violation of Title 18, United States Code, Section 1956(a)(1)(B)(i).
On March 29, 2019, following a four-week jury trial, Montoya was convicted of one count of conspiracy to commit wire fraud, in violation of Title 18, United States Code, Section 1349, and one count of federal program bribery, in violation of Title 18, United States Code, Section 666(a)(2) (Case No. 18-CR-20393-Cooke(s)).
According to court documents and evidence presented at trial, the purpose of the Child Care Food Program (CCFP) is to provide nutritious meals and snacks for underprivileged, low-income children in daycare centers across Florida. For many children in the CCFP, the subsidized food served at daycare centers is their only source of food each day. As such, the CCFP provides children classified at or below a certain family income level with daily meals and snacks, at a free or a reduced rate. The government pays vastly higher reimbursement rates for children classified as “free,” as opposed to “non-needy,” for example, up to nine times more per meal. Daycare centers often contract with a sponsoring organization to process and submit their program paperwork. In those situations, the sponsoring organization enters into an agreement to operate the CCFP, and assumes administrative and financial responsibility on behalf of the center. These sponsor organizations occupy trusted roles, and are only paid government funds because they are supposed to perform oversight functions akin to regulators.
Ruballo was the owner and operator of Highland Food Resources, Inc. (HFR), a sponsoring organization of more than two hundred child daycare centers that participated in the CCFP, covering the geographic area from Key West to West Palm Beach and across the State to Florida’s West Coast. In this role, HFR processed paperwork and electronically submitted monthly reimbursement claims for the centers. It was Ruballo – and HFR’s – job to ensure that the claims accurately reflected the neediness levels of the children and the volume of children served meals, and Ruballo was supposed to ensure that the caterer would only be reimbursed for qualifying meals. Once HFR was reimbursed with federal funds, they paid the daycare centers, less HFR’s fee, which is a percentage of the total monthly meal reimbursements. Thus, the size of HFR’s payment was driven, in part, by the number of meals claimed by daycare centers that are multiplied by a higher reimbursement rate for the free and reduced meals/snacks.
On behalf of HFR, Ruballo was personally responsible for soliciting meal catering companies and awarding contracts through a competitive, anonymous bidding process.
Montoya was the owner and operator of Montoya Holdings, Inc., d/b/a Healthy Children Catering and Pelota Café and Pizzeria. The record evidence showed that Montoya, Ruballo, and others conspired to rig the catering bid process and award contracts to Montoya from 2012 to 2016. As a result of the bid-rigging scheme, Montoya Holdings received lucrative contracts, and was paid more than $13 million in federal funds, via HFR, which were supposed to be used for providing nutritious meals to children at daycare centers in South Florida.
Ruballo, Montoya and others conspired to rig the catering bid process through materially false and fraudulent representations to the CCFP. For example, because of their collusion, Montoya outbid his competitor for a lucrative blanket catering contract by one penny per meal. Over the years, Montoya was awarded numerous blanket contracts that in total were valued at more than $16 million. While Ruballo was supposed to be overseeing the fairness of this process and ensuring that food complied with the CCFP rules, instead, she looked the other way, as Montoya paid her more than approximately $2 million in kickbacks over the course of the scheme. Montoya and co-conspirators withdrew more than $1.6 million in cash during the conspiracy, and hundreds of thousands of dollars of cash, in turn, were deposited into accounts controlled by Ruballo – including into an account for Ruballo’s husband’s purported mobile car wash business.
Montoya’s bribes bought him protection from regulating agencies, most notably, the Florida Department of Health, and ensured that HFR and Ruballo did not terminate contracts despite repeated complaints about spoiled food. Indeed, the evidence showed that Ruballo and other employees at HFR, at Ruballo’s direction, created falsified reports about other caterers and submitted them to the Department of Health in an attempt to detract attention from Montoya when investigators became suspicious.
After Montoya Holdings caused a staph-induced foodborne illness outbreak in November 2016, affecting more than 140 preschool children in Miami-Dade and Broward Counties, the Department of Health and regulators ultimately banned Montoya Holdings from participating in the CCFP. Despite this prohibition, the bribery continued. In February 2017, Montoya paid a $160,000 bribe to Ruballo and HFR, which the co-conspirators attempted to disguise as a “donation” or “settlement.”
In addition, Montoya failed to report more than $27 million in income to the IRS for Montoya Holdings from 2013-2016. Evidence at trial also showed that he used the proceeds of the crime to fund personal expenditures, including visits to the Seminole Hard Rock Casino, a strip club, homes, cars, and jewelry.
Separate and apart from the kickback and bribery part of the scheme, Ruballo and other co-conspirators also falsified paperwork for children enrolled at daycare centers in order to qualify more kids for free and reduced meals under the CCFP, and steal more money for themselves. This fraudulent paperwork was used as the basis for inflated monthly reimbursement claims that Ruballo submitted to the program, for which HFR received reimbursement from the CCFP. In total, through this over inflation fraud, the CCFP paid HFR approximately $12 million that it was not entitled to. Put differently, HFR was paid a total reimbursement of approximately $50 million, but if the paperwork had been completed accurately, it would only have received approximately $38.
Finally, Ruballo stole additional federal funds for herself by falsely and fraudulently inflating the HFR budget. Specifically, she added non-existent companies and ghost employees to the budget, including her own former nanny, to illegally obtain additional program funds. All told, Ruballo caused a loss to the CCFP of at least $26 million, and personally received at least $3 million in ill-begotten gains.
U.S. Attorney Fajardo Orshan commended the investigative efforts of IRS, USSS, USDA and the Fort Lauderdale Police Department. The case is being prosecuted by Assistant U.S. Attorneys Lisa H. Miller and Daniel J. Marcet.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or at http://pacer.flsd.uscourts.gov.
Erie Man Pleads Guilty in Project Safe Neighborhoods CaseRead the Press Release
ERIE, Pa. - A resident of Erie, Pennsylvania, pleaded guilty in federal court to a charge of violating federal firearms laws, United States Attorney Scott W. Brady announced today.
Jonathan Dominic Mull, 20, pleaded guilty to one count before United States District Judge Susan Paradise Baxter.
In connection with the guilty plea, the court was advised that on December 4, 2018, Mull possessed a firearm which he was precluded from possessing because of an active protection from abuse order and as a result of being a convicted felon.
Judge Baxter scheduled sentencing for October 22, 2019 at 1:30 p.m. The law provides for a total sentence of 10 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Pending sentencing, the court continued Mull on bond.
Assistant United States Attorney Christian A. Trabold is prosecuting this case on behalf of the government.
The United Marshal’s Service conducted the investigation that led to the prosecution of Mull with assistance from the Bureau of Alcohol, Tobacco, Firearm and Explosives.
This case is being prosecuted as part of Project Safe Neighborhood (PSN), the centerpiece of the Department of Justice’s violent crime reductions 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 prevent and reentry programs for lasting reductions in crime.
Eastside Hollygrove Resident Charged in Heroin and Fentanyl Conspiracy Sentenced to Ten YearsRead the Press Release
U.S. Attorney Peter G. Strasser announced that DONALD MARCELIN, a/k/a “Golfer,” a/k/a “Black,” a/k/a “Snook,” age 41, of New Orleans, was sentenced yesterday after pleading guilty to one count of conspiring to distribute one kilogram or more of heroin and a quantity of fentanyl.
United States District Judge Sarah S. Vance sentenced MARCELIN to ten years of imprisonment followed by (5) five years of supervised release.
According to court records, during the timeframe of the charged drug conspiracy, MARCELIN conspired with codefendants Jonathan LAWRENCE, Brandon HALL, Aloysius KORIEOCHA, Brian MAXSON, Dwayne LABRANCH, Lance STOVALL, Vonzo MAGEE, and others, to distribute heroin and fentanyl throughout the New Orleans area. These individuals were members of a drug-trafficking organization that operated primarily in the Eastside Hollygrove neighborhood of New Orleans. Collectively, the group referred to their neighborhood as “The Zoo,” a name derived from a popular rap song and video filmed in the neighborhood. Each of the eight defendants has been linked to drug activity in Eastside Hollygrove through law enforcement controlled purchases, Title III wire and electronic interceptions, witness statements, drug seizures, and other evidence. Each of the eight defendants in this case has pleaded guilty. Thus far, only MARCELIN and KORIEOCHA have been sentenced.
U.S. Attorney Strasser praised the work of the FBI New Orleans Gang Task Force (NOGFT), which led this investigation and was assisted by the Drug Enforcement Administration, New Orleans Police Department, St. Tammany Parish Sheriff’s Office, Jefferson Parish Sheriff’s Office, and the Orleans Parish District Attorney’s Office. Assistant United States Attorneys Brandon S. Long, David Haller, and Edward Rivera are in charge of the prosecution.
East Bay Man Sentenced to Seven Years in Prison for His Role in Robbery of Undercover Federal AgentRead the Press Release
OAKLAND – James Medeiros was sentenced to 84 months in prison for using, carrying and brandishing a firearm during and in relation to a crime of violence, announced United States Attorney David L. Anderson and Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) Special Agent in Charge Rayfield Roundtree. The sentence was handed down by the Honorable Haywood S. Gilliam, Jr., U.S. District Judge.
In November of 2018, Medeiros, 25, of San Leandro, agreed with Anthony Reed, 23, of San Leandro; Jesus Angel Sanchez, 20, of Oakland; and Marcos Antonio Martenez, 25, of Oakland, to rob a person who they lured to a location purportedly to purchase firearms. Specifically, Medeiros understood that his co-conspirators had persuaded the customer, unbeknownst to them an undercover ATF agent, to travel to a building in Oakland to purchase firearms for $8,000. Medeiros brought a firearm to the robbery as instructed by one of his co-conspirators. One of the co-conspirators met the undercover agent in front of a building and instructed the agent to follow him to the back of the building. Medeiros was waiting at the back of the building with another co-conspirator. When the agent arrived, the co-conspirators robbed him. Medeiros and a co-conspirator brandished firearms and pointed them at the agent while another co-conspirator demanded the agent’s money. Reed, Sanchez, and Medeiros were apprehended leaving the scene of the robbery. Martenez was arrested days later.
On November 29, 2018, a federal grand jury returned a superseding indictment, charging Medeiros, Reed, Sanchez, Martenez, and others with multiple crimes related to the conspiracy in which Medeiros participated. Medeiros was charged with conspiracy, in violation of 18 U.S.C. § 371; robbery of mail, money, or other property of the United States, in violation of 18 U.S.C. § 2114(a) and 2; assault on a federal officer with a deadly or dangerous weapon, in violation of 18 U.S.C. §§ 111(b) and 2; and using, carrying and brandishing a firearm during and in relation to a crime of violence, in violation of 18 U.S.C. § 924(c)(1)(A)(ii). He pleaded guilty to the § 924(c)(1)(A)(ii) charge and the remaining charges were dismissed at sentencing.
In addition to the prison term, Judge Gilliam also sentenced Medeiros to a three-year term of supervised release to begin at the conclusion of his prison term.
Reed, Sanchez and Martenez also pleaded guilty to using, carrying and brandishing a firearm during and in relation to a crime of violence. All three defendants face a mandatory minimum term of seven years’ imprisonment and a maximum term of life imprisonment, as well as a $250,000 fine. The sentencing hearings for Reed, Sanchez, and Martinez are scheduled for August 26, 2019; September 16, 2019; and July 29, 2019, respectively.
Special Assistant U.S. Attorney Samantha Schott is prosecuting the case with the assistance of Jessica Rodriguez Gonzalez. The prosecution is the result of an investigation by the ATF, with the assistance of the Alameda County Sheriff’s Office, California Highway Patrol, and the Oakland Police Department.
E-Commerce Company Pleads Guilty to Antitrust ChargeRead the Press Release
Gennex Media LLC (aka Brandnex.com and PMGOA) pleaded guilty and was sentenced today for conspiring to fix prices for customized promotional products sold online to customers in the United States. Gennex Media’s president, Akil Kurji, was also sentenced today for his role in the conspiracy.
According to the felony charges filed on Nov. 1, 2018, and the plea agreement filed today in the U.S. District Court for the Southern District of Texas in Houston, Gennex Media, its president, Akil Kurji, and their co-conspirators agreed to fix the prices of customized promotional products sold online from May 2014 until at least June 2016. The customized promotional products subject to the conspiracy included wristbands, lanyards, temporary tattoos, and buttons. The defendants and their co-conspirators used social media platforms and encrypted messaging applications, such as Facebook, Skype, and Whatsapp, to reach and implement their illegal agreement. In addition to pleading guilty, Gennex was sentenced to pay a $752,717 criminal fine. Kurji was sentenced to eight months in custody, a $20,000 criminal fine, and three years of supervised release.
“Today’s guilty plea and sentencings demonstrate the Division’s commitment to uncovering and prosecuting collusion that affects the online marketplace,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division. “We will continue to hold companies and their top executives accountable, seeking significant criminal fines and prison terms for those who violate the antitrust laws at the expense of everyday Americans.”
“The Department of Justice’s simple message is don’t collude to fix prices,” said U.S. Attorney Ryan K. Patrick for the Southern District of Texas. “If you are caught doing this, not only will you likely face large fines, but you could end up in federal prison. Fixing prices hurts consumers and market competitors, whether the conspiracy involves small, logo branded items or million dollar pieces of equipment.”
“The guilty plea and sentencing handed down today should serve as a warning to those who would corrupt America’s business markets that the FBI and its partners will pursue justice for our consumers,” said Perrye K. Turner, Special Agent in Charge of FBI’s Houston Field Office. “Such conduct will not be tolerated and there are harsh consequences for companies and their executives who violate competition law.”
To date, 11 defendants have been charged in the investigation into the online customized promotional products industry. Of those defendants, five individuals and four companies have pleaded guilty. The corporate guilty pleas in the investigation have resulted in criminal fines totaling almost $10 million.
This prosecution arose from an ongoing federal antitrust investigation into price fixing in the online promotional products industry, which is being conducted by the Antitrust Division’s Washington Criminal I Office, with the assistance of the U.S. Attorney’s Office for the Southern District of Texas and the FBI’s Houston Field Office. Anyone with information on price fixing or other anticompetitive conduct related to other products in the customized promotional products industry should contact the Antitrust Division’s Citizen Complaint Center at 888-647-3258 or visit www.justice.gov/atr/contact/newcase.html.
Department of Corrections Nurse Pleads Guilty to Drug ChargesRead the Press Release
BOSTON – A nurse at the Department of Correction’s Massachusetts Alcohol and Substance Abuse Center (MASAC) in Plymouth pleaded guilty today in federal court in Boston to distributing Suboxone pills to inmates in that facility.
Julie Inglis-Somers, 39, of Kingston, Mass., pleaded guilty to distribution of a controlled substance. U.S. District Court Judge Indira Talwani scheduled sentencing for Oct. 24, 2019. In December 2018, Inglis-Somers was charged by criminal complaint and arrested in Jacksonville, Fla. after fleeing the District of Massachusetts. She was indicted in January 2019.
On or about Nov. 18, 2018, and Dec. 4, 2018, Inglis-Somers provided Suboxone strips and pills to two inmates at MASAC. Suboxone, a Class III controlled substance used to treat heroin addiction, is sometimes misused to get high. Suboxone is a coveted contraband in prisons across the nation and is particularly popular in New England.
MASAC is one of five facilities in Massachusetts where, under Massachusetts General Laws, a state court judge can send a person who the judge has determined to be a danger to themselves or to others due to substance abuse. MASAC is the only such facility overseen by the Massachusetts Department of Corrections.
The charge of distribution of a controlled substance provides for a sentence of no greater than 10 years in prison, three years of supervised release and a fine of $500,000. 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; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and Commissioner Carol Mici of the Massachusetts Department of Correction made the announcement today. The FBI Jacksonville (FL) Field Division and the Suwannee County (FL) Sheriff’s Office provided assistance with the arrest. Assistant U.S. Attorney Eugenia M. Carris of Lelling’s Public Corruption and Special Prosecutions Unit is prosecuting the case.
Davie Resident Sentenced to 87 Months in Prison for Being a Felon in PossessionRead the Press Release
A Davie resident who possessed a firearm and ammunition was sentenced for being a felon in possession of a firearm and ammunition and required to forfeit his interest in the firearm and ammunition.
Ariana Fajardo Orshan, U.S. Attorney for the Southern District of Florida, Ari C. Shapira, Special Agent in Charge, U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Miami Field Office, and Dale Engle, Chief, Davie Police Department, made the announcement.
Roberto Alexander Gonzalez, 28, was sentenced by Senior U.S. District Judge William J. Zloch to 87 months in prison, to be followed by three years of supervised release for being a felon in possession of a firearm and ammunition, in violation of Title 18, United States Code, Sections 922(g)(1) and 924(a)(2) (Case No. 19CR60053). Judge Zloch ordered that during the term of Gonzalez’s supervised release he be subject to a permissible search and be required to obtain anger control/domestic violence treatment; mental health treatment; and substance abuse treatment. Judge Zloch also ordered the forfeiture of Gonzalez’s interest in the firearm and ammunition.
According to the court record, including the agreed upon factual proffer, on August 19, 2018, Gonzalez and another man attacked and beat a man in a convenience store in Davie. Gonzalez used a handgun to beat the victim and then pointed the handgun at the victim before fleeing to a local bar. Davie Police Officers arrived at the scene and interviewed the victim, who had blood streaming from lacerations above his left eye and on the back of his head. The officers located Gonzalez at the bar and recovered the loaded handgun from where it had been hidden inside the bar’s closet. The beating was recorded by the convenience store’s security cameras. DNA from both Gonzalez and the victim was recovered from the handgun.
At the time he possessed the handgun, Gonzalez was a felon who had previously been convicted of felonies in two cases in Broward County – possession of cocaine with intent to sell or deliver, and burglary of a dwelling.
Gonzalez has also been charged by the State of Florida, which charges are based upon the beating of the victim during the same incident. The defendant is presumed innocent of the state charges unless and until proven guilty in a court of law.
U.S. Attorney Fajardo Orshan commended the investigative efforts of ATF and the Davie Police Department. This case was prosecuted by Assistant U.S. Attorney William T. Shockley.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or at http://pacer.flsd.uscourts.gov.
Convicted Felon Sentenced to Prison for Firearm and Cocaine PossessionRead the Press Release
RICHMOND, Va. – A Petersburg man was sentenced today to more than seven years in prison for possessing two firearms as a convicted felon and cocaine during a high-speed pursuit with the U.S. Marshal’s Fugitive Task Force.
According to court documents, Kevin Godette, 39, was wanted by the Colonial Heights Police Department and the Petersburg Bureau of Police for outstanding probation violations. In December 2017, in an effort to arrest Godette on these warrants, the U.S. Marshal’s Fugitive Task Force conducted surveillance on an apartment suspected of harboring Godette. Upon seeing Godette leave the apartment and get into a vehicle with a backpack, members of the U.S. Marshal’s Task Force attempted a traffic stop on his vehicle. Godette engaged law enforcement in a high-speed chase through both Colonial Heights and Petersburg, where he bailed out of the vehicle and fled on foot.
U.S. Marshal Task Force members arrested Godette a short time later in a wooded area. While Godette was arrested, authorities revealed more than $160 in U.S. currency and multiple plastic baggies containing distribution amounts of cocaine. A search of Godette’s vehicle revealed the backpack previously possessed by Godette contained two loaded semi-automatic pistols. At the time of Godette’s possession of the two firearms, he was a convicted felon, and thus prohibited from possessing any firearm.
This case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Ashan M. Benedict, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, and Nick Proffitt, U.S. Marshal for the Eastern District of Virginia, made the announcement after sentencing by U.S. District Judge John A. Gibney, Jr. Assistant U.S. Attorney Erik S. Siebert prosecuted the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 3:18-cr-133.
Chicago Felon Sentenced to 42 Months for Gun CrimeRead the Press Release
MADISON, WIS. – Scott C. Blader, United States Attorney for the Western District of Wisconsin, announced that Aaron T. Washington, 25, of Chicago, Illinois, was sentenced today by U.S. District Judge James D. Peterson to 42 months in federal prison for possessing a firearm as a convicted felon. Washington pleaded guilty to the charge on April 15, 2019.
On December 31, 2018, at 6:00 pm, on December 31, 2018, Washington attempted to rob a customer outside of a Kwik Trip on Madison’s east side. The intended victim refused to give Washington money, and the victim went back into the Kwik Trip. The Madison Police Department was called and they had Kwik Trip play their interior videos for them. Close-up photographs of the robber showed the distinct tattoos on Washington’s face.
Madison police officers traced footprints in the snow to a nearby first-floor apartment, where they located Washington. A subsequent search of the apartment led to the recovery of a loaded Taurus handgun in the toilet tank. The Taurus matched the description given by the attempted robbery victim. Washington was transported to the North District Police Station, where he temporarily escaped from the holding cell.
Washington’s prior felony conviction was for aggravated unlawful use of a weapon/occupied vehicle, in Cook County, Illinois in 2013.
Under the federal sentencing guidelines, Washington’s range was 27 to 33 months. The United States asked for a higher sentence, considering the aggravating facts of the offense conduct. Judge Peterson agreed, and decided that 42 months was an appropriate sentence.
This case was brought as part of Project Safe Neighborhoods (PSN), the U.S. Justice Department’s program to reduce violent crime. The PSN approach emphasizes coordination between state and federal prosecutors and all levels of law enforcement to address gun crime, especially felons illegally possessing firearms and ammunition and violent and drug crimes that involve the use of firearms.
The charge against Washington was the result of an investigation conducted by the Madison Police Department and Bureau of Alcohol, Tobacco, Firearms and Explosives. This prosecution was handled by Assistant U.S. Attorney Rita M. Rumbelow.
California Man Charged with Illegally Exporting Cesium Atomic Clocks to Hong KongRead the Press Release
BOSTON – A California man was arrested and charged in an indictment unsealed today in federal court in Boston with illegally exporting cesium atomic clocks to Hong Kong.
Alex Yun Cheong Yue, 67, of South El Monte, Calif., was indicted on one count of conspiracy to commit export violations, two counts of unlawful exports and attempted exports of U.S. goods to Hong Kong, and one count of smuggling. Yue will appear this afternoon in federal court in Los Angeles. Wai Kay Victor Zee, 56, of Hong Kong, along with his company, Premium Tech Systems, Limited were also charged. The two defendants remain at large in Hong Kong Special Administrative Region of the People’s Republic of China.
According to the charging document, beginning in December 2015, Yue, Zee, and Premium Tech conspired to procure U.S.-origin cesium atomic clocks and export them to Hong Kong without obtaining the required export licenses. Cesium atomic clocks are used in global positioning system solutions, network timing protocols, encryption programs, and national defense and space applications. They are controlled for export by the U.S. Department of Commerce for national security and anti-terrorism reasons.
To obtain the atomic clocks, Yue allegedly used a fictitious company, “Ecycle Tech International Ltd.,” to purchase them by falsely representing to the U.S. seller that the atomic clocks would be used solely in the United States for cordless phone research and development. Based on Yue’s false representations, the U.S. seller sold the cesium atomic clocks to Ecycle. On Feb. 19, 2016, the atomic clocks shipped from the manufacturing facility in Beverly, Mass., to Yue in California. Three days later, on Feb. 22, 2016, Yue reshipped the controlled cesium atomic clocks to Zee at Premium Tech in Hong Kong. Neither Yue, Zee, nor Premium Tech ever applied for or obtained the required export licenses from the U.S. Department of Commerce. On Feb. 24, 2016, Zee confirmed receipt of the cesium atomic clocks in Hong Kong.
In December 2017, Yue allegedly attempted to purchase an additional cesium atomic clock. Prior to the sale, however, the U.S. seller required Yue to provide an end-user statement detailing where and for what the clocks would be used. In April 2018, Yue sent an end-user certificate on Ecycle letterhead stating that the atomic clocks would be used in a calibration lab in California. It is alleged that in response to further inquiries from the U.S. seller, Yue falsely declared that he was not intending to export the cesium atomic clocks. When the U.S. seller insisted on a site visit to the California location where the atomic clocks would be utilized, Yue abruptly canceled the order. On July 13, 2018, Yue received a refund payment from the U.S. seller. Three days later, on July 16, 2018, Yue sent a wire transfer to Premium Tech’s bank account in Hong Kong with the refunded money.
The charge of conspiring to commit export violations and unlawfully exporting and attempting to export U.S. goods provides for a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $1 million. The charge of smuggling goods from the United States provides for a sentence of no greater than 10 years in prison, three years of supervised release and a fine of $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew Lelling; William Higgins, Acting Special Agent in Charge of the Department of Commerce, Office of Export Enforcement, Boston Field Office; and Peter C. Fitzhugh, Special Agent in Charge of the Homeland Security Investigations in Boston, made the announcement today. Assistant U.S. Attorney George P. Varghese of Lelling’s National Security Unit is prosecuting the case.
The details contained in the charging documents are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Burnsville Man Sentenced to 20 Years in Prison for Producing Child Pornography via Instagram and X-BoxRead the Press Release
United States Attorney Erica H. MacDonald today announced the sentencing of MARCUS ALEXANDER HINKLE, 22, to 240 months in prison for producing child pornography using Instagram and X-Box. HINKLE, who pleaded guilty on September 19, 2018, to two counts of was sentenced before Judge Susan Richard Nelson in U.S. District Court in Saint Paul, Minnesota.
U.S. Attorney MacDonald said, “Sextortion crimes such as this are prevalent and often victimize the most vulnerable in our society, children. This office will continue to use all available resources to prosecute and prevent these devastating crimes.”
According to the defendant’s guilty plea and documents filed in court, from May 2017 through July 2017, HINKLE used several Instagram accounts he created under various names, including “Nation_Of_Nerve,” “Nation_Of_Nerve_VIP,” and “Globalspamnation,” to contact and communicate with minor males. HINKLE also used an X-box to communicate with the minors and to obtain sexually explicit images. HINKLE falsely represented to the minors that he was fifteen years old.
According to the defendant’s guilty plea and documents filed in court, in May of 2017, HINKLE contacted Minor #1 via Instagram and, through the course of their on-line conversations, HINKLE pressured Minor #1 to send sexually explicit images and videos. Between late June and early July of 2017, HINKLE used Minor #1 to be “introduced” to Minor #2 and, after approximately one week of communicating on-line, HINKLE asked Minor #2 to send to him sexually explicit images and videos via Instagram. HINKLE continued to pressure Minor #2 for more sexually explicit images and videos and threatened to post sexually explicit pictures of Minor #2 in a group chat if he did not comply. HINKLE did in fact send out a group chat message that contained sexually explicit pictures of Minor #2. Hinkle admitted to engaging in the same conduct with other minors. More than a dozen minors were victimized by HINKLE.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
If you know of any child who may have been a victim of exploitation, please call the National Center for Missing or Exploited Children (NCMEC) at 1-800-THE-LOST (1-800-843-5678) or visit NCMEC’s web site at www.missingkids.com.
This case was prosecuted by Assistant United States Attorney Carol M. Kayser.
This case is the result of an investigation conducted by the FBI, the Eagan Police Department, and the Warren (Michigan) Police Department.
Defendant Information:
MARCUS ALEXANDER HINKLE, 22
Burnsville, Minn.
Convicted:
- Production of child pornography, 2 counts
Sentenced:
- 240 months in prison
- Lifetime of supervised release
###
Additional news available on our website.
Follow us on Twitter and Facebook.
United States Attorney’s Office, District of Minnesota: (612) 664-5600
Brooklyn Man Pleads Guilty for His Role in Identity Theft ScamRead 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 Jeriel Slay, 29, of Brooklyn, NY, pleaded guilty before U.S. District Judge Richard J. Arcara to conspiracy to commit wire fraud and aggravated identity theft. The charges carry a maximum penalty of 22 years in prison and a $250,000 fine.
Assistant U.S. Attorney Jonathan P. Cantil, who is handling the case, stated that on December 14, 2016, the defendant devised a sophisticated scheme to fraudulently obtain the personal identifying information (PII) of multiple victims from the internet. Slay then opened Limited Liability Companies (LLCs) that were named in such a way as to indicate ownership by the victim.
For example, the defendant fraudulently obtained Victim 1’s PII, including name, address, birthdate, social security number, and other information, and then opened an LLC named “Victim 1 Remodeling LLC.” Slay then, unbeknownst to Victim 1, placed a mail hold on Victim 1’s actual address which prevented Victim 1 from obtaining mail that indicated an LLC was opened in his name. The defendant then posed as Victim 1 to open a bank account in the name of the fraudulent LLC. Slay then contacted Victim 1’s legitimate financial institution and transferred money, via a wire transfer, from Victim 1’s legitimate account to the fraudulent LLC bank account. Slay, using device-making equipment, then created fraudulent driver’s licenses, fraudulent utility bills, and other identification documents in the name of Victim 1. Using these fraudulent documents, Slay then ordered a co-conspirator to go to the bank that serviced the fraudulent LLC bank account to withdraw and deplete the funds from the fraudulent account.
The defendant executed this scheme against more than 10 victims, one of whom resides in the Western District of New York. The total loss was $978,793.87.
Slay was charged along with his sister Angela Slay, Michael Wright and Sirr Wright. Michael Wright was also convicted of conspiracy to commit wire fraud and aggravated identity theft, and is awaiting sentencing. Charges remain pending against Angela Slay and Sirr Wright. The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
The plea is the result of an investigation by the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Gary Loeffert.
Sentencing is scheduled for October 18, 2019, at 12:30 p.m. before Judge Arcara.
# # # #
Brockton Man Indicted for Federal Drug OffensesRead the Press Release
BOSTON – A Brockton man was charged in federal court in Boston yesterday with distributing fentanyl and cocaine.
Rayshawn DaCruz, 23, was indicted on four counts of distribution of a controlled substance. DaCruz was arrested and charged in May 2019 in Brockton.
According to charging documents, on April 4, April 16, May 2, and May 6, 2019, DaCruz distributed various amounts of fentanyl and cocaine to an undercover police officer.
Each charge of distribution of a controlled substance provides for a sentence of no greater than 20 years in prison, three years of supervised release, and a fine up to $1 million. 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; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigations, Boston Field Division; Plymouth County District Attorney Timothy J. Cruz; Colonel Kerry A. Gilpin, Superintendent of the Massachusetts State Police; and Brockton Police Chief John Crowley made the announcement today. Assistant U.S. Attorney Nicholas Soivilien of Lelling’s Organized Crime and Gang Unit is prosecuting the case.
This prosecution is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
The details contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Bossier Parish Community College comptroller, 2 others indicted for stealing more than $250,000Read the Press Release
SHREVEPORT, La. – United States Attorney David C. Joseph announced that a federal grand jury indicted Carol Bates, 48, Faith Alexander, 27, and Marquise Perry, 34, all of Shreveport, Wednesday for stealing more than a quarter of a million dollars from Bossier Parish Community College (BPCC).
All three were charged with one count of conspiracy to commit wire fraud. In addition to the conspiracy to commit wire fraud, Bates was charged with 12 counts of wire fraud and Perry was charged with three counts of wire fraud.
According to the indictment, as the BPCC comptroller, Bates used her position to access an internal BPCC computer system and issue approximately $259,591.87 in refunds to Alexander, Perry and five others from 2013 to 2016. They were not qualified to receive the funds, and, in most cases, they were not even attending BPCC during the semesters they received the monies. In total, Bates caused 45 fraudulent refunds to be issued. Perry received seven refunds totaling $49,524.65 from 2015 through 2016 and Alexander received eight refunds totaling $45,482.65 from 2014 through 2016. The remaining 30 refunds were issued to five unnamed co-conspirators who, after receiving the money, transferred two-thirds or a half of it to Bates.
If convicted, the defendants face 20 years in prison, three years of supervised release, restitution and a $250,000 fine for each count.
The U.S. Department of Education, Office of Inspector General, and the Louisiana Office of State Inspector General conducted the investigation. Assistant U.S. Attorney Seth D. Reeg is prosecuting the case.
An indictment is merely an accusation and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
Attorney General’s Advisory Subcommittee on Native American Issues Meets to Discuss Violent Crime in Indian CountryRead the Press Release
The Native American Issues Subcommittee convenes on June 25 at the Eisenhower Executive Office Building to discuss violent crime in Indian Country during the U.S. Attorney's National Conference in Washington, D.C.WASHINGTON – Attorney General William P. Barr’s Advisory Subcommittee on Native American Issues (NAIS) convened this week during the U.S. Attorney’s National Conference in Washington, D.C., to discuss a wide range of justice issues affecting Indian Country, announced U.S. Attorney Trent Shores, Chair, and U.S. Attorney Kurt Alme, Vice Chair.
“The Native American Issues Subcommittee is focused on reducing violent crime against women and children in Indian Country, including missing and murdered indigenous persons,” said U.S. Attorney Trent Shores. “I am thankful for Attorney General Barr’s leadership on these issues. He understands the law enforcement and jurisdictional challenges faced by Native Americans and Alaska Natives. We look forward to working with him and with our federal, tribal, state and local partners to find viable solutions that will improve public safety in Indian country.”
On Tuesday, the NAIS met with Tara Katuk Mac Lean Sweeney, Assistant Secretary of Indian Affairs, Department of the Interior, and discussed cross-agency collaboration in order to provide more responsive and effective justice services to Indian Country. They further discussed Indian Country case investigations, case intake and tracking databases, and tribal law enforcement resource allocation. The NAIS also reviewed President Trump’s priorities for Indian Country justice. Those priorities include protecting Native American children in the Indian Health Services system, collaboration among Department of Justice, the Department of the Interior, and tribal law enforcement agencies, reducing violent crime, and providing services to help victims to overcome trauma.
On Wednesday, Trent Shores, NAIS Chair and U.S. Attorney for the Northern District of Oklahoma, moderated a panel titled Murdered and Missing Indigenous Women: A Crisis in Urban America & Indian Country. Panelists included Charles Addington, Director of the Office of Justice Services, Bureau of Indian Affairs; Kurt Alme, U.S. Attorney for the District of Montana; Tracy Toulou, Director of the Office of Tribal Justice; Laura Rogers, Acting Director of the Office on Violence Against Women; and Bryan Vorndran, Deputy Assistant Director of the FBI. The panel discussed the development and implementation of protocols to investigate murdered and missing indigenous persons and how to more accurately measure the scope of the problem in both urban America and Indian Country in order to develop strategies to address it.
In August, the subcommittee is scheduled to reconvene in Indian Country in New Mexico.
The NAIS consists of the approximately 53 U.S. Attorneys serving in districts that include Indian Country or one or more federally recognized tribes. The NAIS focuses exclusively on Indian Country issues, both criminal and civil, and makes policy recommendations to the Attorney General regarding public safety and legal issues that impact tribal communities.
The NAIS is the longest standing subcommittee to the Attorney General’s Advisory Committee and helps develop, shape, and otherwise implement justice policies affecting Native Americans and Alaska Natives. The NAIS has identified four priority areas: 1) Violent crime 2) Law enforcement resources 3) Drug trafficking and substance abuse, and 4) White collar crime.
xxx
Attorney General's Advisory Subcommittee on Native American Issues Meets to Discuss Violent Crime in Indian CountryRead the Press Release
WASHINGTON— Attorney General William P. Barr’s Advisory Subcommittee on Native American Issues (NAIS) convened this week during the U.S. Attorney’s National Conference in Washington, D.C., to discuss a wide range of justice issues affecting Indian Country, announced U.S. Attorney Trent Shores, Subcommittee Chair, U.S. Attorney Kurt Alme, Subcommittee Vice Chair and U.S. Attorney Billy J. Williams, Subcommittee Member.
“The Native American Issues Subcommittee is focused on reducing violent crime against women and children in Indian Country, including missing and murdered indigenous persons,” said U.S. Attorney Trent Shores. “I am thankful for Attorney General Barr’s leadership on these issues. He understands the law enforcement and jurisdictional challenges faced by Native Americans and Alaska Natives. We look forward to working with him and with our federal, tribal, state and local partners to find viable solutions that will improve public safety in Indian country.”
“Pursuing justice on behalf of native women is a priority for our office and has been for many years. We are deeply committed to the advancing rights of native women, increasing their access to justice, and combatting invisibility and erasure” said Billy J. Williams, U.S. Attorney for the District of Oregon. “Reducing violence in tribal communities, especially against native women, is a sacred duty. I look forward to continuing to work with my colleagues from the Native American Issues Subcommittee on this issue and many others affecting public safety in Indian Country.”
On Tuesday, the NAIS met with Tara Katuk Mac Lean Sweeney, Assistant Secretary of Indian Affairs, Department of the Interior, and discussed cross-agency collaboration in order to provide more responsive and effective justice services to Indian Country. They further discussed Indian Country case investigations, case intake and tracking databases, and tribal law enforcement resource allocation. The NAIS also reviewed President Trump’s priorities for Indian Country justice. Those priorities include protecting Native American children in the Indian Health Services system, collaboration among Department of Justice, the Department of the Interior, and tribal law enforcement agencies, reducing violent crime, and providing services to help victims to overcome trauma.
On Wednesday, Trent Shores, NAIS Chair and U.S. Attorney for the Northern District of Oklahoma, moderated a panel titled Murdered and Missing Indigenous Women: A Crisis in Urban America & Indian Country. Panelists included Charles Addington, Director of the Office of Justice Services, Bureau of Indian Affairs; Kurt Alme, U.S. Attorney for the District of Montana; Tracy Toulou, Director of the Office of Tribal Justice; Laura Rogers, Acting Director of the Office on Violence Against Women; and Bryan Vorndran, Deputy Assistant Director of the FBI. The panel discussed the development and implementation of protocols to investigate murdered and missing indigenous persons and how to more accurately measure the scope of the problem in both urban America and Indian Country in order to develop strategies to address it.
In August, the subcommittee is scheduled to reconvene in Indian Country in New Mexico.
The NAIS consists of the approximately 53 U.S. Attorneys serving in districts that include Indian Country or one or more federally recognized tribes. The NAIS focuses exclusively on Indian Country issues, both criminal and civil, and makes policy recommendations to the Attorney General regarding public safety and legal issues that impact tribal communities.
The NAIS is the longest standing subcommittee to the Attorney General’s Advisory Committee and helps develop, shape, and otherwise implement justice policies affecting Native Americans and Alaska Natives. The NAIS has identified four priority areas: 1) Violent crime 2) Law enforcement resources 3) Drug trafficking and substance abuse, and 4) White collar crime.
Anne Arundel Medical Center to Pay More Than $3 Million to Settle Federal False Claims Act AllegationsRead the Press Release
Baltimore, Maryland – Anne Arundel Medical Center (“AAMC”), located in Annapolis, Maryland, has agreed to pay the United States $3,154,000 to settle allegations under the False Claims Act that it submitted false claims to Medicare for services that were not medically necessary.
The settlement agreement was announced today by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge of the Office of Inspector General for the Department of Health and Human Services, Maureen Dixon; Norbert E. Vint, Acting Inspector General of the U.S. Office of Personnel Management; and Robert E. Craig, Jr., Special Agent in Charge for the Defense Criminal Investigative Services, Mid-Atlantic Division.
“Companies that submit false bills to the government must be held accountable. The United States Attorney’s Office is committed to taking the steps necessary to protect Medicare and other federal healthcare programs from fraud and abuse and recover taxpayers’ money,” said U.S. Attorney Robert K. Hur.
In or about June 2007, AAMC opened its Anticoagulation Clinic (“the Clinic”) to monitor outpatient’s anticoagulation therapy. Patients who take Coumadin or the generic equivalent have their blood routinely tested to monitor their clotting times. These tests are known as prothrombin time international normalized ration (PT-INR) tests. These tests measure how much time it takes for a patient's blood to clot and can be billed by a clinic using Current Procedural Terminology (CPT) code 85610. If test results indicate the need to adjust a patient’s Coumadin dose, or the patient presented with a change in medical condition, the provider may perform, and submit a claim for, an Evaluation and Management (E/M) service. According to the settlement agreement, between January 1, 2010 and December 31, 2013, AAMC submitted false claims to Medicare, TRICARE, and the Federal Employees Health Benefits Program for E/M services that were not medically reasonable and necessary at the same time it submitted and was paid for claims for the blood tests.
Effective January 1, 2014, CMS updated the hospital outpatient prospective payment system by bundling PT-INR tests with E/M services, when E/M services were provided during the same visit. The new CPT code that the clinic would use is G0463. According to the settlement agreement, between January 1, 2014 and December 31, 2017, AAMC submitted false claims to Medicare for both the bundled code G0463 and CPT 85610, notwithstanding that the PT-INR tests were included in G0463 claims.
The United States alleged that for the time period before January 1, 2014, a substantial percentage of the claims for CPT 99211 submitted by AAMC were not medically reasonable and necessary when submitted with CPT 85610. Further, the United States alleged that after January 1, 2014, all claims submitted by AAMC for CPT 85610 represented false claims when submitted with G0463.
The claims resolved by this settlement are allegations. The settlement is not an admission of liability by AAMC, nor a concession by the United States that its claims are not well founded.
Contemporaneous with the civil settlement, AAMC entered into a five-year Corporate Integrity Agreement (CIA) with the HHS-OIG which requires, among other things, the implementation of a risk assessment and internal review process designed to identify and address evolving compliance risks on an ongoing basis. The CIA requires training, auditing, and monitoring designed to address the conduct at issue in the case.
The settlement resolves a lawsuit brought by Barbara McHenry, a former AAMC employee, under the qui tam, or whistleblower, provisions of the False Claims Act, captioned United States, et al. ex rel. McHenry v. Anne Arundel Medical Center, Case No. ELH-15-1256. As part of the settlement, the whistleblower will receive $473,100.
The Maryland United States Attorney’s Office’s action in this matter illustrates its commitment to combat health care fraud using the False Claims Act. Tips from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services, at 800-HHS-TIPS (800-447-8477).
United States Attorney Robert K. Hur commended the U.S. Department of Health and Human Services - Office of Inspector General; OPM-Office of Inspector General; and the Defense Criminal Investigative Services, Mid-Atlantic Division for its work in the investigation. Mr. Hur also thanked Assistant United States Attorney Roann Nichols, who handled the case.
# # #
11 Defendants Charged in Credit Card “Bust Out” SchemeRead the Press Release
Five complaints were unsealed yesterday in federal court in Brooklyn charging 11 defendants in a scheme to defraud banks by using fake, or “synthetic,” identities to obtain credit cards, and making approximately $3 million in charges that were never repaid to the issuing financial institutions. Three of the defendants were also charged with money laundering conspiracy, designed to conceal the source of the proceeds of their scheme. Nine defendants were arrested yesterday. Eight defendants made their initial appearances before United States Magistrate Judge Lois Bloom and were released on bond. One defendant will appear today before Magistrate Judge Bloom. Two defendants are not in custody.
Richard P. Donoghue, United States Attorney for the Eastern District of New York, Angel M. Melendez, Special Agent-in-Charge, Homeland Security Investigations, New York (HSI), and Linda A. Lacewell, Superintendent, New York State Department of Financial Services (DFS), announced the charges.
“As alleged, the defendants operated a ‘bust out’ scheme using fraudulently obtained credit cards to finance expenses, ranging from furniture to real estate and totaling $3 million. Now they will be held accountable,” stated United States Attorney Donoghue. “Together, with our law enforcement partners, we stand committed to protecting financial institutions from fraud.”
“Those arrested today allegedly engaged in fraudulent activities aided by shell companies and collusive merchants to carry out their ‘bust out’ schemes and the laundering of its proceeds, defrauding financial institutions of millions of dollars” stated HSI Special Agent-in-Charge Melendez. “As revealed in this investigation, synthetic identity fraud is ever evolving in sophistication and frequency, creating more challenges for law enforcement and anti-money laundering professionals. HSI New York’s El Dorado Task Force and its partners remain vigilant for emerging criminal trends in its efforts to secure our country’s financial system.”
“While this alleged scheme may seem like a victimless crime, fraud hurts the entire financial system, including banks and credit card companies, with the costs passed down to consumers. DFS is pleased to have partnered with the U.S. Attorney’s Office to bring these defendants to justice, and we will continue to use all of the resources at our disposal to combat fraud,” stated DFS Superintendent Lacewell.
As alleged in court filings, between January 2013 and December 2017, the defendants used synthetic identities created by using various types of personal identification information (names, dates of birth and Social Security numbers) from different individuals to create a fake identity and obtain credit cards from financial institutions. They then used those cards for expenditures that they had no intention to repay, including mortgages on three residential properties in Queens, New York. The defendants also used shell companies, that did little or no legitimate business, to record hundreds of thousands of dollars on the fraudulently obtained credit cards, and then received payment for the sham transactions from financial institutions and credit card processors.
Defendants Bahader Thiara, Hafeez Ali, Mohammad Akhtar, Nadezhda Epshteyn, Cyrus Shroff, Anis Khan, Daljeet Singh, Zainoelbaks Karimbux and Gursimardeep Singh Rai are charged with access device fraud. Bahader Thiara, Perminder Thiara and Shaila Khondkar are also charged with money laundering conspiracy.
If convicted, the defendants charged with access device fraud face up to 10 years’ imprisonment, and up to 20 years for money laundering conspiracy.
The charges are allegations, and the defendants are presumed innocent unless and until convicted.
The government’s case is being handled by the Office’s General Crimes Section. Assistant United States Attorneys Temidayo Aganga-Williams and David Lizmi are in charge of the prosecution. Assistant United States Attorney Tanisha Payne of the Office’s Civil Division is handling forfeiture matters.
The Defendants:
E.D.N.Y. Docket No. 19-MJ-583
MOHAMMED AKHTAR
Age: 43
Flushing, New YorkHAFEEZ ALI
Age: 54
Fort Hamilton, BrooklynE.D.N.Y. Docket No. 19-MJ-566
SHAILA KHONDKAR
Age: 48
Jamaica, New YorkBAHADER THIARA
Age: 42
Queens Village, New YorkPERMINDER THIARA
Age: 40
Queens Village, New YorkE.D.N.Y. Docket No. 19-MJ-570
NADEZHDA EPSHTEYN
Age: 44
Rockaway Park, New YorkCYRUS SHROFF
Age: 45
Rockaway Park, New YorkE.D.N.Y. Docket No. 19-MJ-1029
ZAINOELBAKS KARIMBUX
Age: 50
Bellerose, New YorkGURSIMARDEEP SINGH
Age: 34
Bronx, New YorkE.D.N.Y. Docket No. 19-MJ-571
ANIS KHAN
Age: 32
Sheepshead Bay, New YorkDALJEET SINGH (also known as “Akhtar Iqbal”)
Age: 46
College Point, New York
26 June 2019
“Happy Holidays” Bank Robber Pleads Guilty in Armed Heist of Citizens Bank in CraftonRead the Press Release
PITTSBURGH, PA- A former resident of Crafton, PA, pleaded guilty yesterday in federal court to a charge of armed bank robbery, United States Attorney Scott W. Brady announced today.
Brent Richards, age 33, pleaded guilty before United States District Judge Peter J. Phipps to Count One of the three-count Indictment, which also charges his mother, Melissa Kane, at Count Three.
In connection with the guilty plea, the Court was advised that on January 8, 2018, at approximately 9:18 a.m., Richards, dressed in all black, entered the Citizens Bank located at 31 Foster Avenue, Pittsburgh, Pennsylvania 15205, carrying a black umbrella and, what appeared to be, a black and silver semi-automatic style handgun, which was later determined to be a bb-gun. The Court was further informed that Richards pointed the bb-gun at two of the tellers, placed a white bag on the counter and demanded that the tellers empty their drawers of cash. Richards took $10,003 from the bank and, when exiting the bank, stated: "Sorry, Happy Holidays."
Judge Phipps scheduled sentencing for October 16, 2019, at 10:30 a.m. The law provides for a maximum total sentence of 25 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant. Richards remains in custody pending sentencing.
Assistant United States Attorneys Rebecca L. Silinski and Timothy M. Lanni are prosecuting this case on behalf of the government.
The Federal Bureau of Investigation, the Crafton Borough Police Department, the Allegheny County Sherriff’s Office, and the West Mifflin Police Department conducted the investigation that led to the prosecution of this case.
Wheeling man and Columbus man admit to role in cocaine and heroin distribution operationRead the Press Release
WHEELING, WEST VIRGINIA – Two men have admitted to their roles in a cocaine and heroin distribution operation, United States Attorney Bill Powell announced.
Andre Hager, also known as Andyman, of Wheeling, pled guilty to one count of “Conspiracy to Distribute Cocaine Base and Heroin.” Hager, age 47, admitted to distributing cocaine and heroin, in Ohio County from April 2018 to September 2018.
Joshua Ford, also known as “Fatboy,” of Columbus, Ohio, pled guilty to one count of “Aiding and Abetting the Distribution of Cocaine Base within 1,000 feet of a Protected Location.” Ford, age 29, admitted to selling cocaine near Jensen Playground on Wheeling Island in May 2018.
Hager and Ford are each facing no less than one and up to 40 years incarceration and a fine of up to $2,000,000. 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 Stephen L. Vogrin is prosecuting the case on behalf of the government. The investigation was led by the Ohio County Drug & Violent Crimes Task Force, a HIDTA-funded initiative. The task force is comprised of the Drug Enforcement Administration, West Virginia State Police, the Ohio County Sheriff’s Office, and the Wheeling Police Department. Those assisting in the arrests are the United States Marshal Service; Marshall County Drug & Violent Crimes Task Force, a HIDTA-funded initiative; the Hancock-Brooke-Weirton Drug & Violent Crimes Task Force, a HIDTA-funded initiative; the Martins Ferry, Ohio Police Department; and the Columbus, Ohio Police Department.
U.S. Magistrate Judge James P. Mazzone presided.
Van Buren Man Sentenced to Life in Federal Prison for Sexually Abusing Two MinorsRead the Press Release
Fort Smith, Arkansas - Duane (DAK) Kees, United States Attorney for the Western District of Arkansas and Diane Upchurch, Special Agent in Charge with the Little Rock FBI, announced that Stanley Rice, age 59, of Van Buren, Arkansas, was sentenced today to Life in federal prison without the possibility of parole on two (2) Counts of Transportation of a Minor with Intent to Engage in Criminal Sexual Activity. The Honorable P.K. Holmes, III presided over the sentencing hearing in the United States District Court in Fort Smith.
According to court records, in February of 2017, a 16-year-old female reported to law enforcement that Rice had been sexually abusing her since she was approximately six years of age. In particular, the minor disclosed that Rice, on multiple occasions, transported her from Arkansas to the state of Texas, and sexually abused her while there. One specific instance verified by law enforcement involved the sexual abuse of the minor female by Rice when she was 9 years of age.
Additionally, while investigating the case, law enforcement located an adult male, who stated that when he was a minor, Rice likewise sexually abused him. Specifically, the adult male disclosed that when he was approximately 15 years of age, Rice transported him from Arkansas to Texas and performed oral sex on him while there.
“This case is a great reminder of the important work that we do in our office and the great mission that we undertake here to ensure that justice is achieved,” stated Kees. “This is especially true for these victims, who are among the most vulnerable members of our community.”
“Rice’s actions in sexually assaulting minors is incorrigible and it is unimaginable how these individuals felt,” stated Upchurch. “We appreciate the dedicated assistance from the Crawford County Sheriff’s Office and the United States Attorney’s Office for the Western District.”
Rice was indicted by a federal grand jury in August of 2018. In February of 2019, Rice pleaded guilty to transporting both minors from Arkansas to the state of Texas for purposes of sexually abusing them.
This case was investigated by the Crawford County Sheriff’s Office and the FBI. Assistant United States Attorney Carly Marshall prosecuted the case for the United States.
U.S. Attorney’s Office Holds Debt Collector Responsible for Collection Practices, Company Agrees to Resolve False Claims Act LiabilityRead the Press Release
PHILADELPHIA – United States Attorney William McSwain announced today that BARR Credit Services, Inc., a commercial debt collection company based in Tucson, Arizona, has agreed to pay $55,793 and start a compliance program to resolve the government’s claims against it under the False Claims Act. The agreement arises from BARR Credit’s attempts to collect debts from the Federal Bureau of Prisons on behalf of Scholars in Print, a telemarketing firm in Bucks County, Pennsylvania.
In 2018, the government filed a complaint against Scholars in Print alleging that it operated a telemarketing scheme. According to the federal court complaint, the telemarketing company submitted false claims to the Bureau of Prisons for textbooks that nobody ordered or wanted. Scholars in Print allegedly hired debt collectors to collect unpaid invoices. The parties resolved that case through a consent judgment. Today’s settlement agreement follows that consent judgment.
In the agreement announced today, the United States contends that BARR Credit, one of Scholars in Print’s debt collectors, knew or should have known that the textbook invoices were fraudulent. Teachers, librarians, non-profit organizations, and public officials told BARR Credit that Scholars in Print operated a fraud scheme and explained how it worked, according to the government’s allegations in the agreement. The United States contends that BARR Credit created records describing these fraud reports, and therefore BARR Credit acted recklessly when it tried to collect similar debts from the Bureau of Prisons.
As part of the resolution, BARR Credit admitted that its quality control procedures did not adequately identify the suspect nature of Scholars in Print’s invoices. To resolve the allegations, BARR Credit will pay $55,793 and will not resume collection efforts for Scholars in Print or its operators, John Paul Ryan and Mary Motz Ryan.
BARR Credit will also start a compliance program designed to protect the public from similar harm. As part of that program, BARR Credit will implement quality control procedures, adopt policies, and monitor customer accounts to identify patterns of fraud reports or suspicious debts. BARR Credit will supervise its debt collectors to prevent them from demanding payment from public or private schools, libraries, non-profit organizations, and federal, state, or local public agencies or officials without first possessing documentary proof that the entity incurred the debt legitimately.
In addition to taking these measures, BARR Credit will train its employees annually about state and federal procurement procedures and government purchasing in order to identify fraudulent debts. BARR Credit will certify its compliance annually during the agreement’s five-year term.
While not admitting liability, BARR Credit acknowledged that any attempt to demand payment from federal agencies for alleged debts can result in False Claims Act liability if the debts are not bona fide debts that comply with federal procurement procedures.
“Debt collectors should do their homework before trying to collect payment from federal agencies,” said U.S. Attorney McSwain when announcing the resolution. “The False Claims Act governs their conduct, so they should not try to collect taxpayer money unless they have a legitimate, documented debt to back it up. My Office stands ready with our federal partners to investigate these claims to protect consumers and taxpayers.”
“The OIG is committed to investigating companies whose reckless attempts at debt collection cause them to make false claims to the Bureau of Prisons. We will work tirelessly with our law enforcement partners to ensure those who do not conduct their due diligence under the law are held accountable,” stated Lewe F. Sessions, Special Agent-in-Charge of the U.S. Department of Justice Office of the Inspector General’s Fraud Detection Office.
Assistant United States Attorney Michael S. Macko handled the case with investigative assistance from the United States Department of Justice Office of Inspector General.
Two International Shipping Executives Indicted for Participating in Long-Running Antitrust ConspiracyRead the Press Release
An indictment of two Norwegian shipping executives was unsealed in the U.S. District Court in Baltimore, the Department of Justice announced today.
Ingar Skiaker and Øyvind Ervik have been charged with participating in a long-running conspiracy to allocate certain customers and routes, rig bids, and fix prices for the sale of international ocean shipments of roll-on, roll-off cargo to and from the United States and elsewhere, including the Port of Baltimore. A federal grand jury returned the indictment in February 2018.
Skiaker and Ervik, both Norwegian citizens, are former top executives at Höegh Autoliners AS, which has pleaded guilty and been sentenced to pay a $21 million fine. Including the charges announced today, 13 executives have been charged in the investigation to date. Four have pleaded guilty and been sentenced to serve prison terms. Others remain international fugitives. Including Höegh, five companies have also pleaded guilty for their roles in this conspiracy, resulting in total collective criminal fines over $255 million.
The indictment alleges that, from at least as early as 2006 and continuing at least until September 2012, Skiaker and Ervik conspired with their competitors to allocate certain customers and routes for the shipment of cars and trucks. The defendants accomplished their scheme by, among other things, attending meetings during which they agreed not to compete against each other, and by refraining from bidding or by agreeing on the prices they would bid for certain customers and routes. In addition, Skiaker and Ervik agreed with competitors to fix, stabilize, and maintain rates charged to customers of international ocean shipping services. The customers affected by the conspiracy included U.S. companies.
“The Division’s investigation revealed that collusion was endemic and rampant in the shipping industry going back years,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division. “The indictment unsealed today advances the Division’s mission to restore and promote open competition. Höegh has already pleaded guilty, and now we must ensure that its executives will be held accountable.”
“The schemes that took place in perpetuating this long-running conspiracy show a clear indifference for the free market, and a willful disregard for the law,” said Special Agent in Charge Jennifer C. Boone for the FBI Baltimore Field Office. “The protection of international commerce and victims affected by such schemes remain a priority for the FBI and we will continue to dedicate resources to these types of investigations in order to protect the United States economy.”
An indictment merely alleges that crimes have been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt.
Today’s announcement is the result of an ongoing federal antitrust investigation into price fixing, bid rigging, and other anticompetitive conduct in the international roll-on, roll-off ocean shipping industry, which is being conducted by the Antitrust Division’s Washington Criminal I Section and the FBI’s Baltimore Field Office, along with assistance from the U.S. Customs and Border Protection Office of Internal Affairs, Washington Field Office/Special Investigations Unit. Anyone with information in connection with this investigation is urged to call the Antitrust Division’s Washington Criminal I Section at 202-307-6694, visit www.justice.gov/atr/contact/newcase.html or call the FBI’s Baltimore Field Office at 410-265-8080.
Two Head to Prison in Kidnapping ConspiracyRead the Press Release
HOUSTON – A Mexican national and a U.S. citizen have been ordered to federal prison following their convictions of conspiracy for attempting to commit the kidnapping of a Houston man, announced U.S. Attorney Ryan K. Patrick. Julio Cesar Garcia-Longoria, a 42-year-old Mexican National from Nuevo Laredo, and Iraida Griselda Hernandez, 42, of Houston, pleaded guilty Oct. 12, 2018.
Today, U.S. District Judge David Hittner imposed a 175-month sentence for Garcia-Longoria, while Hernandez was ordered to serve 135 months to be followed by five years of supervised release. Not a U.S. citizen, Garcia-Longoria is expected to face deportation proceedings following his sentence.
Hernandez was also charged in an unrelated federal drug trafficking conspiracy involving the delivery of 7.5 kilograms of cocaine. She was also sentenced in that case today to another 135 months which was ordered to run concurrently.
Between Jan. 10-18, 2018, Garcia-Longoria enlisted the assistance of Hernandez in Houston to have a Houston man kidnaped in an effort to recoup a drug trafficking debt of up to $1.7 million. Authorities were alerted to the plot which he had participating in via cell phone from Monterrey, Mexico.
Hernandez gathered biographical information on the Houston man and identified his residence. Law enforcement contacted him and enlisted his assistance to thwart the plot. The victim agreed to pose for photos, appearing bound, which were then sent to Hernandez and Garcia-Longoria.
The defendants made it clear the intended victim owed money to a drug cartel in Mexico and efforts should be made to extort money from the victim’s family. Garcia-Longoria stated that the victim should be killed if he tried to get away. He agreed to pay a total of between $8,000 and $10,000 for the job.
Both will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Drug Enforcement Administration conducted the investigation. Assistant U.S. Attorney Edward Gallagher is prosecuting the case.
Troy Man Pleads Guilty to Attempted Online Enticement of a MinorRead the Press Release
ALBANY, NEW YORK – Michael Varian, age 52, of Troy, New York, pled guilty today to one count of attempted online enticement of a minor, announced United States Attorney Grant C. Jaquith and James N. Hendricks, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI).
As part of his guilty plea, Varian, a school bus driver, admitted that he attempted to entice an individual, whom he believed to be a 14-year-old boy, to have sex. After weeks of exchanging sexually explicit text messages with undercover law enforcement officers posing as the boy, Varian arranged to meet the boy at a fast food restaurant in Albany County, where Varian was arrested. As part of the plea, Varian also admitted that he had a prior sexual encounter with a minor boy in the public bathroom of an Albany County mall.
As a result of his conviction, Varian faces at least 10 years and up to life in prison, and a term of post-release supervision of at least 5 years and up to life. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines, and other factors. Sentencing is scheduled for October 16, 2019 before Senior United States District Judge Thomas J. McAvoy. Varian will also have to register as a sex offender upon his release from prison.
This case was investigated by the FBI and its Child Exploitation Task Force, which includes members of state and local law enforcement agencies, including the Town of Colonie Police Department, and is being prosecuted by Assistant U.S. Attorneys Joshua R. Rosenthal and Megan Kinsella Kistler.
This case is being prosecuted as part of Project Safe Childhood. Launched in May 2006 by the Department of Justice, Project Safe Childhood is led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit https://www.justice.gov/psc
Three Marketers Plead Guilty to Violations of Federal Anti-Kickback StatutesRead the Press Release
Three marketers have pleaded guilty in U.S. District Court to offering or paying illegal kickbacks to physicians in relation to the government health care insurance programs Medicare, TRICARE, and the FECA Program, announced U.S. Attorney Trent Shores
Daniel Richard Ferguson, 47, of Broken Arrow; John Richard Frohrip, 52, of Tulsa; and Kevin Ellis Partin, 49, of Bixby, were charged this month in three separate Informations with offering or paying health care kickbacks. The men caused federal health care insurance programs to pay reimbursement costs for expensive compounding drug prescriptions written by recruited doctors in return for kickback payments. The defendants would then use the reimbursed funds for their own financial gain.
“Kickback schemes undermine the integrity of government healthcare programs and raise healthcare costs for Americans. These greed fueled schemes frustrate patient-oriented decision-making because doctors make prescription and pharmacy decisions based on their personal financial enrichment,” said U.S. Attorney Trent Shores. “Professionals in the healthcare market in northern Oklahoma should be on notice by now that kickback schemes will be exposed and those involved held accountable.”
In their plea agreements, the men acknowledged offering to pay kickbacks to physicians and that on March 30, 2015, they allegedly paid a physician, Dr. John Main, of Tulsa, a $15,000 check payment from an account controlled by Brookhaven Specialty Pharmacy, LLC, which constituted a kickback in return for the physician referring patients to Brookhaven for compounding prescriptions that would be reimbursed by the federal health care program Tricare.
Violating the anti-kickback statute carries up to five years in prison and a $250,000 possible fine.
Assistant U.S. Attorneys Melody N. Nelson and Richard M. Cella are prosecuting the cases. The IRS- Criminal Investigation; U.S. Postal Service- Office of Inspector General (OIG); Department of Veterans Affairs- OIG; FBI; Department of Health and Human Services- OIG; Defense Criminal Investigative Service; and Department of Labor- OIG conducted the investigation.
Ten Year Prison Term Imposed for a Fentanyl DistributorRead the Press Release
Spokane – Joseph H. Harrington, United States Attorney for the Eastern District of Washington, announced that Taylor Fertig, age 24, of Kennewick, Washington, was sentenced after having pleaded guilty to Conspiracy to Distribute 400 grams or more of Fentanyl. Senior United States District Judge Edward Shea imposed a 10-year term of imprisonment, to be followed by a 5-year term of court supervision after release from federal prison.
According to information disclosed during court proceedings, Fertig was identified as one of the first major distributors of Fentanyl-laced pills that are unlawfully made to appear to be prescription oxycodone medication. Fentanyl, an extremely potent opioid, is largely responsible for the marked increase in drug overdoses and deaths in this District. As Judge Shea noted during the sentencing hearing, Fentanyl is the most dangerous and insidious drug facing our community today and, based upon the quantity of pills being sold by Fertig and his negative impact on this community, in combination with his possession of multiple firearms, a ten year sentence was appropriate.
Joseph H. Harrington said, “The United States Attorney’s Office for the Eastern District of Washington will aggressively prosecute cases involving fentanyl distribution, and the sentence imposed in this case demonstrates that fentanyl dealers will be held accountable for their illegal conduct. I commend the outstanding investigative work of our federal, state, and local law enforcement partners.”
DEA Special Agent in Charge Keith Weis was pleased with the sentencing further adding that “Opioid abuse is spreading like wildfire devastating our communities and we will aggressively pursue those most responsible for fueling the flames.”
Today’s enforcement action is part of an Organized Crime Drug Enforcement Task Force (OCDETF) investigation. The OCDETF program provides supplemental federal funding to the federal and state agencies involved in the investigation of drug-related crimes. This OCDETF investigation is being conducted by the U.S. Drug Enforcement Administration.
This case was investigated by the Spokane Resident Office of the Drug Enforcement Administration in partnership with the Kennewick, Pasco and Richland Police Departments. This case was prosecuted by Stephanie Van Marter, an Assistant United States Attorney for the Eastern District of Washington.
Stamford Sex Offender Pleads Guilty to Federal Child Pornography ChargeRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, and Peter C. Fitzhugh, Special Agent in Charge of Homeland Security Investigations (HSI) in Boston, announced that BRIEN PENNELL, 31, of Stamford, waived his right to be indicted and pleaded guilty today in Hartford federal court to one count of receipt of child pornography.
According to court documents and statements made in court, in February 2008, Pennell was convicted in state court of sexual assault and possession of child pornography offenses. Pennell served 30 months in prison and was sentenced to 15 years of probation for those offenses.
On February 2, 2018, after an investigation revealed that an IP address registered to Pennell was being used to share images and videos of child pornography via the Kik application, Connecticut probation officers conducted a compliance search of Pennell’s residence and vehicle and seized various electronic media, including a smart phone and a tablet, both of which were located in a hidden compartment under the steering wheel of Pennell’s vehicle.
Subsequent analysis of the seized electronic devices, Pennell’s Kik account and a Dropbox account he maintained, revealed 148 videos and 40 images of child pornography, some of which depict children younger than 12 engaging in sexually explicit conduct.
Pennell is scheduled to be sentenced by U.S. District Judge Robert N. Chatigny on September 12, 2019, at which time Pennell faces a mandatory minimum term of imprisonment of 15 years and a maximum term of imprisonment of 40 years. The minimum and maximum penalties in this case are enhanced based on Pennell’s criminal history.
Pennell has been detained since his federal arrest on March 20, 2018.
This matter is being investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), with the assistance of Connecticut’s Office of Adult Probation and the Stamford Police Department. The case is being prosecuted by Assistant U.S. Attorney Nancy V. Gifford.
This prosecution is part of the U.S. Department of Justice’s Project Safe Childhood Initiative, which is aimed at protecting children from sexual abuse and exploitation. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
To report cases of child exploitation, please visit www.cybertipline.com.
St. Louis County Dentist Pleads Guilty to Illegal Prescriptions for Opioid Narcotic Drugs and Medicare FraudRead the Press Release
St. Louis, MO – Bradley A. Seyer, D.D.S., 53, of Florissant, Missouri, pled guilty today to two felony charges for making false statements to Medicare and illegally distributing narcotic opioid drugs, specifically hydrocodone, without a legitimate medical purpose. Seyer appeared before U.S. District Judge Ronnie White who accepted his plea and set his sentencing for September 25, 2019.
According to the plea agreement, Dr. Seyer provided a hydrocodone prescription to a woman identified by her initials E.A. in the plea agreement. Dr. Seyer has a personal relationship with E.A. that lasted over ten years. Dr. Seyer gave E.A. money and jewelry, and took her on vacation trips. During their relationship, defendant prescribed E.A. with over 14,000 units of Alprazolam (sometimes marketed and sold as Xanax®), Diazepam (sometimes marketed as Vaium®), Carisoprodol (sometimes marketed and sold as Soma®), Hydrocodone, and Tramadol (sometimes marketed and sold as Ultram®). Dr. Seyer prepared and kept some dental treatment records for E.A., but they are incomplete. Dr. Seyer’s records fail to contain all of the prescriptions that he prescribed for E.A. Further, the records do not document office visits and examinations by Dr. Seyer of E.A. before he issued some of the prescriptions.
In his plea agreement, Dr. Seyer admitted that he and E.A. together consumed some "street" and prescription drugs for recreational purposes. E.A. often requested prescription drugs by text, leading Dr. Seyer to call in the prescriptions at her request. E.A. was depressed and had suicidal ideation, and had a history of mental illness. On several occasions during summer 2018, Dr. Seyer and E.A. discussed her desire to commit suicide. Ultimately, E.A. died at her home during July of 2018 of a fentanyl overdose. Dr. Seyer did not prescribe fentanyl to E.A.
Further, in the plea agreement, Dr. Seyer admitted that he prescribed Tramadol® to E.A.’s father, identified by his initials in the plea agreement as G.A. G.A. has Medicare coverage. Dr. Seyer had no records showing any dental treatment for G.A. However, Dr. Seyer issued five prescriptions to E.A. using G.A.'s name, and Medicare paid for these five prescriptions, including a Tramadol® prescription dated December 2, 2015.
“The diversion of licit opioids for illicit purposes is illegal no matter the circumstances and when carried out by a member of the medical community is nothing but irresponsible and dangerous. Medical professionals are trained to responsibly dispense opioids, and those who don’t violate every aspect of the oath to protect human life,” said Special Agent in Charge William Callahan of the DEA’s St. Louis Division. “This behavior is unlawful, which is why the DEA will continue our fight to expose violators, including those who operate behind the shield of a medical license.”
Steve Hanson, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General, Kansas City Region, stated, “Our office will continue to vigorously pursue healthcare providers who submit improper claims for reimbursement to publicly funded healthcare programs and, more specifically abuse their position by irresponsibly prescribing narcotics that endanger the well-being of their patients.”
The charges of false statements to Medicare carry a maximum penalty of 5 years in prison and a $250,000 fine. The drug distribution charge has a maximum penalty of either 10 years in prison and a fine of $500,000. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges. Sentencing has been set for September 25, 2019.
This case was investigated by the Department of Public Safety for the City of Des Peres, Missouri and the U.S. Drug Enforcement Administration, with assistance from the Bureau of Narcotic and Dangerous Drugs of the Missouri Department of Health and Human Services, the U.S. Department of Health and Human Services, Office of the Inspector General, and the Medicaid Fraud Control Unit of the Missouri Attorney General’s Office.
Springfield Business Owner Sentenced to 25 Years for Leading Meth ConspiracyRead the Press Release
SPRINGFIELD, Mo. – A Springfield, Missouri, man was sentenced in federal court today for leading a conspiracy to distribute large quantities of methamphetamine.
Christopher A. Jefferson, 46, was sentenced by U.S. District Judge M. Douglas Harpool to 25 years in federal prison without parole. Jefferson, who has two prior state convictions for distribution/delivery of a controlled substance, was sentenced as a career offender due to his prior drug-trafficking convictions. Jefferson owned a car repair business in Springfield.
On Oct. 25, 2018, Jefferson pleaded guilty to his role in the drug-trafficking conspiracy that lasted from Dec. 2, 2016, to Jan. 23, 2018. During the course of the investigation, law enforcement officers seized a total of 5.342 kilograms of methamphetamine from various co-conspirators.
Jefferson frequently used women to transport illegal drugs, including large quantities of methamphetamine in vehicles and smaller quantities of cocaine and heroin hidden inside of their vaginas. They were paid to drive to Texas, Arizona, or California to pick up methamphetamine and other drugs and transport them back to Springfield. Several women admitted they made multiple trips to acquire illegal drugs, sometimes in multi-kilogram quantities.
Co-defendant Kathy J. Alexander, 62, of Springfield, was arrested while driving through Amarillo, Texas, on Jan. 11, 2016, with a half-pound of heroin and six pounds of methamphetamine that she was transporting from Arizona to Springfield. Alexander had also been stopped, but not arrested, on Dec. 2, 2014, by law enforcement officers in Oklahoma while she was transporting five ounces of heroin hidden in her underwear. Alexander admitted that she had made 14 drug-transporting excursions, averaging one trip each month, for which she was paid $500 per trip. Alexander pleaded guilty and was sentenced to seven years in federal prison without parole.
Co-defendants Davetta F. Hicks, 31, and Shawn B. Robinson, 48, both of Springfield, were arrested on Dec. 9, 2014, by Kingsville, Texas, police officers. This was their third trip to Texas for Jefferson. Officers found a half-pound of methamphetamine in Hicks’s purse. Hicks admitted that she made three trips to Texas to transport cocaine, heroin and methamphetamine to Springfield. Hicks pleaded guilty and was sentenced to five years and 10 months in federal prison without parole. Robinson pleaded guilty and was sentenced to six years in federal prison without parole.
Undercover law enforcement officers also purchased methamphetamine from Jefferson’s distributors. Undercover officers purchased a total of 115 grams of methamphetamine in six separate purchases, all of which was supplied by Jefferson.
On one occasion, according to court documents, conspirators traveled to California with a large amount of money to purchase methamphetamine. Once in California, they purchased 12 pounds of methamphetamine that was shipped to Springfield.
On another occasion, conspirators attached a four-pound package of methamphetamine to the front bumper of their vehicle and drove back to Springfield. During the return trip, however, Maricopa County, Arizona, law enforcement officers arrested them and seized the methamphetamine.
On two occasions, a co-conspirator carried two kilograms of methamphetamine to Springfield aboard a commercial bus.
This case is being prosecuted by Assistant U.S. Attorney Abram McGull II. It was investigated by the Drug Enforcement Administration, the Springfield, Mo., Police Department, and COMET (the Combined Ozarks Multijurisdictional Enforcement Team).
Sells Man Sentenced to 31 Months' Federal Prison for Assault with a HammerRead the Press Release
TUCSON, Ariz. – On June 25, 2019, Eli Lawrence Manuel, 30, of Sells, Ariz., was sentenced by U.S. District Judge James A. Soto to 31 months of imprisonment to be followed by three years of supervised release. Manuel had previously pleaded guilty on March 6, 2019, to assault with a dangerous weapon.
On July 6, 2017, Manuel assaulted the victim, a pregnant woman, by striking her on her forehead and stomach with a hammer. The assault happened on the Tohono O’odham Nation Indian Reservation. Both Manuel and the victim are enrolled members of the Tohono O’odham Indian Tribe.
The investigation in this case was conducted by the Tohono O’odham Nation Police Department and the Federal Bureau of Investigation. The prosecution was handled by Raquel Arellano and Christopher J. Curran, Assistant U.S. Attorneys, District of Arizona, Tucson.
Republic Man Sentenced to 20 Years for Coercion and Enticement of a MinorRead the Press Release
SPRINGFIELD, Mo. – A Republic, Missouri, man was sentenced in federal court today for the coercion and enticement of a minor.
Clifford Benjamin Kinkade, 37, was sentenced by U.S. District Judge M. Douglas Harpool to 20 years in federal prison without parole. The court also sentenced Kinkade to 15 years of supervised release following incarceration, and ordered him to pay $29,417 in restitution to his victim.
On Oct. 9, 2018, Kinkade pleaded guilty to using the internet and a cell phone to attempt to entice a child victim to engage in illegal sexual activity.
According to court documents, Kinkade met the 14-year-old child victim, identified as “Jane Doe,” online through one of her friends. They communicated primarily through text messages and through Kik and Skype. Investigators seized Kinkade’s computer, cell phone, and tablet, which contained messages between Kinkade and the child victim. Many of the messages were sexual in nature, where Kinkade described sexual activities he would like to engage in with Jane Doe and asked her to engage in sexual activity.
This case was prosecuted by Assistant U.S. Attorney Ami Harshad Miller. It was investigated by the Southwest Missouri Cyber Crimes Task Force, Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI), the Springfield, Mo., Police Department, the Greene County, Mo., Sheriff’s Department, and the Kentucky State Police.
Project Safe Childhood
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."Project Parkersburg Update: Parkersburg Man Sentenced to Prison for Methamphetamine ConspiracyRead the Press Release
CHARLESTON, W.Va. – United States Attorney Mike Stuart announced that Edward Marks, 33, of Parkersburg, was sentenced to 60 months in prison for conspiracy to distribute 50 grams or more of methamphetamine. Marks was prosecuted as part of Project Parkersburg – a major takedown and dismantling of a multi-state drug trafficking organization (DTO) responsible for distributing methamphetamine and heroin. Stuart commended the investigative efforts of the FBI, the Parkersburg Police Department, the Dayton Ohio Police Department, and the Parkersburg Narcotics and Violent Crime Task Force. The long-term, joint investigation resulted in at least 29 individuals being charged in federal and state court, the seizure of 121 pounds of ICE methamphetamine, six kilograms of cocaine, 217 grams of heroin, and 290 grams of fentanyl.
“Marks is one of the 17 individuals charged in a federal indictment as a result of Project Parkersburg,” said United States Attorney Mike Stuart. “The law enforcement operation shut down a significant DTO responsible for trafficking massive amounts of drugs in Wood County and elsewhere.”
United States District Judge Irene C. Berger imposed the sentence. Assistant United States Attorney Joshua C. Hanks is responsible for the prosecution.
Follow us on Twitter: @SDWVNews and @USAttyStuart
###
Penn Medicine Agrees to Pay $275,000 to Settle False Claims Act AllegationsRead the Press Release
PHILADELPHIA, PA – United States Attorney William McSwain announced today that the Trustees of the University of Pennsylvania Health System (“Penn Medicine”) agreed to settle allegations under the False Claims Act that the Lancaster General Hospital’s division of Maternal Fetal Medicine (LGH-MFM), a component of Penn Medicine, submitted false claims to Medicaid for obstetric ultrasounds.
The government alleges that, from approximately May 1, 2017 through December 31, 2017, LGH-MFM had insufficient physician staff to properly handle its patient volume. As a consequence, the government alleges that during this period, LGH-MFM physicians failed to timely complete professional reports interpreting many of the ultrasound studies that they ordered for their obstetric patients. Such a timely report is required for Medicaid to reimburse a physician for professional interpretation of an ultrasound. Further, extreme delays in completing such a report can render the report and interpretation worthless.
Specifically, the government alleges that in many instances, LGH-MFM physicians did not finalize professional reports of ultrasound studies until more than thirty days after the ultrasound was performed. In over 10% of cases during this time period, the report was not completed until more than 90 days after the ultrasound was performed, and in some cases not until after the patient delivered. The government alleges that LGH-MFM violated the False Claims Act by nevertheless submitting claims for reimbursement to Medicaid for ultrasound interpretations when it knew or should have known the claims were not reimbursable due to the extreme delays in completing the physician’s reports.
“Maternal-fetal medicine physicians manage the most high risk and complex pregnancies,” said U.S. Attorney McSwain. “This alleged conduct not only demonstrated an abuse of the Medicaid program, but had troubling potential implications for patient care. Medicaid beneficiaries, especially expectant mothers carrying high risk pregnancies, deserve better. We thank the citizens who brought this concerning situation to our attention.”
“Timely report writing is important for patient care and the proper billing of Medicaid,” said Maureen R. Dixon, Special Agent in Charge of the Philadelphia Regional Office of the Inspector General, Department of Health and Human Services. “HHS-OIG is committed to working with the U.S. Attorney’s Office, our law enforcement partners, and the public to ensure the integrity of federal health care dollars.”
The U.S. Attorney’s Office opened this investigation in response to a tip from citizens. This case was not brought pursuant to the qui tam provisions of the False Claims Act
This case was investigated by the U.S. Department of Health and Human Services Office of the Inspector General. For the U.S. Attorney’s Office, the investigation and settlement were handled by Assistant U.S. Attorney John T. Crutchlow and Auditor Dawn Wiggins.