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10 June 2019
Former Director of a Law Enforcement Association Pleads Guilty to Stealing FundsRead the Press Release
St. Louis, MO – Paul Kesterson, 48, of Washington, MO, was employed as a Lieutenant with the Washington, Missouri Police Department, pled guilty to a one count Information – Access Device Fraud. Kesterson appeared before U.S. District Judge Webber today who accepted his plea and set his sentencing for September 10, 2019.
According to his plea agreement, between February 1, 2018 and April 2019, Kesterson served as the Director of the St. Louis Area Law Enforcement Exploring Association (STLEEA) and as a Lieutenant with the Washington, Missouri Police Department. As the Director of STLEEA, Kesterson handled all of the finances and managed the Explorer Academy training. He was issued a credit and debit card so he could draw upon funds of the STEELA checking account for the benefit of the organization. After the Assistant Director received a phone call from U.S. Bank regarding a late credit card payment, an investigation was conducted regarding Kesterson’s use of the STLEEA account, as well as a Washington Police Department bank account controlled by Kesterson on behalf of STLEEA. Financial records revealed that Kesterson had been using the credit/debit card to make personal purchases. The total loss to obtain goods and services totaled over $29,000. During the instant investigation regarding the STLEEA U.S. Bank account activity from 2018 to April 2019, no other members of the Washington Police Department or any other law enforcement agencies were found to be involved in Kesterson’s criminal activity.
Kesterson faces not more than 15 years, fine of not more than $250,000. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the U.S. Secret Service, Washington Police Department and O’Fallon, Missouri Police Department.
Former Colorado Springs Sheriff’s Deputy Sentenced to Nine Years in Prison for Receiving and Possessing Child PornographyRead the Press Release
Donald Glenn Beasley (“Beasley”), 56, of Key Largo, was sentenced today by U.S. District Court Judge K. Michael Moore to 108 months in prison and 20 years of supervised release for receiving and possessing child pornography in connection with internet downloads Beasley made of child pornography.
Ariana Fajardo Orshan, U.S. Attorney for the Southern District of Florida and George Piro, Special Agent in Charge, Federal Bureau of Investigations (FBI), Miami Field Office, made the announcement.
Beasley, a former sheriff’s deputy in Colorado Springs, Colorado, had been downloading child pornography on a peer-to-peer network and utilizing a state of the art encryption when he became known to FBI special agents. According to the stipulated facts filed in court, on September 20, 2018, a search warrant was executed at Beasley’s residence located at 95500 Overseas Highway in Key Largo, Florida. Pursuant to the search warrant, law enforcement searched a Starcraft trailer, which records checks revealed was registered to Beasley.
After a search of the Starcraft trailer, law enforcement seized various electronic items, including Beasley’s laptop and 3 external hard drives. The forensic examination of the items revealed multiple videos and numerous images of child pornography, many involving minor children under the age of 12. On February 11, 2019, Beasley pled guilty to the receipt and possession of child pornography.
U.S. Attorney Fajardo Orshan commended the investigatory efforts of the FBI in this matter. She thanked the National Center for Missing and Exploited Children for their assistance. This case was prosecuted by Assistant U.S. Attorney Alejandra L. López.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorney’s 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.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Former Bucks County Judge Sentenced to 6 ½ Years in Prison for Public CorruptionRead the Press Release
PHILADELPHIA – U.S. Attorney William M. McSwain announced that John Waltman, 61, of Trevose, Pennsylvania was sentenced to 78 months’ incarceration by Judge Gene E.K. Pratter. In January 2019, the defendant pleaded guilty to conspiracy to commit money laundering and Hobbs Act Extortion Under Color of Official Right.
From 2011 to December 2016, Waltman served as a Magisterial District Judge in Bucks County, Pennsylvania. Together with his co-defendants who will both be sentenced later this week, Bernard Rafferty and Robert Hoopes, Waltman participated in a scheme to extort bribes and kickbacks from Bucks County businessmen. They also conspired to launder money for individuals they believed were engaged in narcotics trafficking and health care fraud.
For example, in November 2016, Waltman, Hoopes, and Rafferty accepted a bribe of $1,000, as well as the promise of other fees, in exchange for Waltman, Hoopes, and Rafferty to use their positions as public officials to “fix” a traffic case before Waltman in Bucks County Magisterial District Court.
In addition, from June 2015 to November 2016, Waltman, Hoopes, and Rafferty conspired to launder funds represented to be proceeds from health care fraud, illegal drug trafficking, and bank fraud. From June 2016 to August 2016, Waltman, Hoopes, and Rafferty laundered $400,000 in cash, represented to be proceeds from health care fraud and illegal drug trafficking, and took money laundering fees totaling $80,000 in cash.
“The laws of the land apply to everyone – especially to public officials who hold office to serve the public good,” said U.S. Attorney McSwain. “When public servants choose to flout the rule of law, they disgrace themselves and the offices they hold. Every public official should be on notice after today’s sentence: federal law enforcement is watching and we will hold you accountable if you make the wrong choices.”
“A crooked judge trading on his position of trust is beyond disheartening,” said Michael T. Harpster, Special Agent in Charge of the FBI's Philadelphia Division. “It's offensive. At every level, the justice system must operate in a fair and impartial manner. This is exactly the sort of case that deepens the public's distrust of elected officials and government, which is why the FBI takes public corruption so seriously.”
“It is unacceptable for anyone, let alone an elected public official, to engage in such conduct,” said IRS-Criminal Investigation Special Agent in Charge Guy Ficco. “John Waltman betrayed the public’s trust when he accepted bribes in exchange for official acts. The sentence he received shows that there is no tolerance for such criminal behavior.”
“Today’s sentencing reflects Homeland Security Investigations’ commitment to, and focus on, the investigation of financial crimes,” said Marlon V. Miller, Special Agent in Charge of HSI Philadelphia. “By using his official position for his personal gain, Mr. Waltman violated the trust placed in him by the public. HSI and our law enforcement partners will continue to vigorously investigate those who conspire to knowingly launder illicit funds derived from criminal activities.”
The case was investigated by the Federal Bureau of Investigation, Internal Revenue Service – Criminal Investigations, Homeland Security Investigations, and the Pennsylvania State Police. It is being prosecuted by Assistant United States Attorneys Louis Lappen and Richard Barrett.
Former Aequitas Owner and Chief Financial Officer Pleads Guilty in Fraud and Money Laundering ConspiracyRead the Press Release
PORTLAND, Ore.—U.S. Attorney Billy J. Williams announced today that Olaf Janke, a former owner and chief financial officer of Aequitas Management, LLC and several other Aequitas-owned entities, has pleaded guilty to conspiring to commit mail and wire fraud and money laundering.
According to court documents, Janke, 48, of Portland, Oregon, along with Brian A. Oliver, 54, of Aurora, Oregon and other unnamed co-conspirators, used the Lake Oswego, Oregon, company to solicit investments in a variety of notes and funds, many of which were purportedly backed by trade receivables in education, health care, transportation, and other consumer credit areas. Janke was the company’s chief financial officer and executive vice president until early 2015 and shared responsibility for the operation and management of Aequitas-affiliated companies and investment products as well as for the use of investor money.
From June 2014 through February 2016, Janke, Oliver and others solicited investors by misrepresenting the company’s use of investor money, the financial health and strength of Aequitas and its related companies, and the risks associated with its investments and investment strategies. Janke and his co-conspirators also failed to disclose other critical facts about the company, including its near-constant liquidity and cash-flow crises, the use of investor money to repay other investors and to defray operating expenses, and the lack of collateral to secure funds.
In March 2015, Janke ended his employment with the Aequitas companies and cashed out his equity in Aequitas Management. From January 2015 through June 2015, he received more than $1.3 million for his equity, knowing that it was paid with fraudulently obtained investor money.
Janke faces a maximum sentence of 30 years in prison, fines of $500,000 or twice the gross monetary gains or losses resulting from his crimes, and three years’ supervised release. He will be sentenced on September 25, 2019 before U.S. District Court Judge Michael H. Simon.
As part of the plea agreement, Janke has agreed to pay restitution in full to each of the victims as determined and ordered by the court.
Co-conspirator Oliver pleaded guilty to the same charges on April 19, 2019.
This case is being investigated by the FBI, IRS Criminal Investigation, and the U.S. Department of Labor Employee Benefits Security Administration. It is being prosecuted by Scott E. Bradford and Ryan W. Bounds, Assistant U.S. Attorneys for the District of Oregon.
Florissant Woman Indicted for Social Security Disability and Wire FraudRead the Press Release
St. Louis, MO – Tayon Hutchins Fowler, 41, of Florissant, was indicted on Thursday with two counts of wire fraud and two counts of making false statements about being disabled to the Social Security Administration (“SSA”). Fowler surrendered this morning to U.S. Marshals.
The indictment alleges that Fowler submitted an application for disability payments to SSA in 2012, claiming to be depressed and unable to work. After Fowler began receiving periodic disability payments from SSA, she started a home health care business and received more than $100,000 per year from this business during 2014, 2015, 2016, and 2017. In July 2017, Fowler sold the home health care business. In March 2018 and again in September 2018, Fowler made two false statements to SSA about not working and not receiving any income since December 2016.
Further, in December 2017, Fowler bought a luxury automobile from a local dealership. To obtain financing, Fowler made false representations to the dealership, falsely claiming that she still owned the home health care business and further was still receiving income from that business. These false representations are charged in Counts Three and Four of the Indictment as wire fraud.
If Fowler is convicted, the false statement charges have a maximum penalty of 5 years in prison and a $250,000 fine, while the wire fraud charges have a maximum penalty of 20 years in prison and a $250,000 fine. Restitution to the victims is also mandatory. In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
As is always the case, charges set forth in an indictment are merely accusations and do not constitute proof of guilt. Every defendant is presumed to be innocent unless and until proven guilty.
The Federal Bureau of Investigation and the Office of Inspector General for the Social Security Administration is investigating this case, with assistance from the Medicaid Fraud Control Unit of the Missouri Attorney General’s Office.
Federal Jury Convicts Defendants of Attempted Enticement of Children to Engage in ProstitutionRead the Press Release
SAN DIEGO – Today, a federal jury convicted Defendants Conoly Freddie Franklin and Andre Anthony Franklin of attempted enticement of minors to engage in prostitution, in violation of 18 U.S.C. § 2422(b). Defendant Conoly Franklin was also convicted of attempted enticement of an adult to engage in prostitution, in violation of 18 U.S.C. § 2422(a).
The evidence at trial established that between August 22, 2018, and August 31, 2018, Conoly Franklin communicated with an undercover officer with the San Diego County Sheriffs’ Department who was working with the San Diego Human Trafficking Task Force. Believed that the officer was a young woman with a teenage sister, over the course of nine days, Conoly Franklin attempted to recruit the officer’s undercover persona and her 16-year old sister to work as prostitutes for him in Reno, Nevada. On August 30, 2018, Conoly Franklin advised he had obtained a vehicle in order to pick up both girls, was bringing his “boy,” and was beginning his trip to the San Diego area location provided by the undercover officer. Conoly Franklin arrived the following morning, along with his son, Andre Anthony Franklin, at which point San Diego Human Trafficking Task Force officers arrested both defendants. Following the Defendants’ arrest, Task Force Officers learned that throughout the trip, Andre Franklin was communicating with someone he believed to be another 16-year old girl, in Napa, California, but who was actually an undercover deputy with the Napa County Special Investigations Bureau. Andre Franklin told the deputy that he would be picking her up and taking her back to Reno to work for him as a prostitute, after he and his father picked up the sisters in San Diego.
The evidence at trial included a text message between Andre Franklin and “Pops,” from Tuesday, August 28, 2018, in which “Pops” asks Andre, “Wanna rock with me to San Diego, got 2 on deck.” Evidence also showed that the undercover deputy in Napa, California told Andre Franklin that she was 16-years-old. Undeterred, Andre Franklin continued to discuss performing commercial sex acts and the price that she would need to pay to work for him.
“The cavalier sex trafficking of children triggers traumas that can affect victims for decades,” said U.S. Attorney Robert S. Brewer, Jr. “Thanks to the efforts of dedicated officers with the San Diego Human Trafficking Task Force and Napa County Special Investigations Bureau and Assistant U.S. Attorneys Katie McGrath, Eric Roscoe, and Mark Conover, these defendants’ devious plans were thwarted in their tracks.”
Sentencing is set for September 9, 2019 before Federal District Court Judge William Hayes.
DEFENDANTS Case Number: 18-CR-4187-WQH
Conoly Freddie Franklin
Andre Anthony Franklin
SUMMARY OF CHARGES
Attempted enticement of an adult (Conoly Franklin) 18 U.S.C. § 2422(a)
Penalty: A maximum of 20 years in prison; a maximum of $250,000, up to five years of supervised release.
Attempted enticement of a minor (both Defendants) 18 U.S.C. § 2422(b)
Penalty: A mandatory minimum of ten years and a maximum of life in prison; a maximum of $250,000, at least five years of supervised release and up to life.
INVESTIGATING AGENCIES
San Diego County Sheriffs’ Department
Federal Bureau of Investigation
San Diego Human Trafficking Task Force
Napa County Special Investigations Bureau
Federal Inmate Pleads Guilty to Weapon ChargeRead the Press Release
CHARLESTON, W.Va. – United States Attorney Mike Stuart announced today that a federal inmate pled guilty to a weapon charge. Joshua Allen, 29, pled guilty to being an inmate in possession of a weapon, admitting that on December 7, 2018, while he was an inmate at the Federal Correctional Institution at Beckley, he possessed a handcrafted weapon known as a “shank.” He admitted that a staff member at the prison recovered the weapon after he tried to discard it. Allen faces up to five years in prison, consecutive to the sentence he is now serving, when he is sentenced on October 2, 2019.
The case was investigated by the Federal Bureau of Prisons and is being prosecuted by Assistant United States Attorney John File. United States District Judge Irene C. Berger presided at the plea hearing.
Erie Felon Lied on Firearms Purchase and Passport Applications FormsRead the Press Release
ERIE, Pa. - A former resident of Erie, Pennsylvania, pleaded guilty in federal court to charges of violating federal firearms laws and making a false statement in an application for a United States passport, United States Attorney Scott W. Brady announced today.
Amaad Maliek Ali, 48, pleaded guilty to two counts before United States District Judge Susan Paradise Baxter.
In connection with the guilty plea on the gun charge, the court was advised that on or about April 7, 2018, Ali falsified his application for the purchase of a firearm and lied about his prior felony convictions. A National Instant Criminal Background Check was made and Ali was rejected for the firearm purchase because of his prior criminal record.
In connection with the guilty plea on the false statement charge, the court was advised that on or about April 18, 2017, Ali made a false statement on a United States passport application by stating that his social security number was 000-00-0000.
Judge Baxter scheduled sentencing for September 26, 2019 at 1:30 p.m. The law provides for a total sentence of 20 years in prison, a fine of $500,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Christian A. Trabold is prosecuting this case on behalf of the government.
The Bureau of Alcohol, Tobacco, Firearms and Explosives, the U.S. Department of State’s Diplomatic Security Service (DSS), the Pennsylvania State Police and the Erie Police Department conducted the investigations that led to the prosecution of Ali.
This case was brought 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.
Elkhart, Indiana Man Sentenced to 120 Months in PrisonRead the Press Release
SOUTH BEND – Steven Perry, age 55, of Elkhart, Indiana, was sentenced before United States District Court Judge Robert L. Miller, Jr. upon his plea of guilty to possession of child pornography, announced U.S. Attorney Kirsch.
Perry was sentenced to 120 months in prison followed by 5 years of supervised release.
According to documents in this case, in December 2018, Perry, who has a prior 2004 federal conviction for receipt and possession of child pornography, was in possession of child pornography that was being shared on a social networking site.
This case was investigated by FBI with assistance from the St. Joseph County High Tech Crimes Task Force. The case was handled by Assistant U.S. Attorney John Maciejczyk.
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Deputy U.S. Marshal Impersonator Pleads Guilty to Federal ChargesRead the Press Release
NASHVILLE, Tenn. – June 10, 2019 – Tooraj Sohrabi Sedeh, 50, of Franklin, Tennessee, pleaded guilty Friday to three counts of impersonating a Deputy U.S. Marshal and making a false statement, announced U.S. Attorney Don Cochran for the Middle District of Tennessee.
On November 21, 2018, a Deputy U.S. Marshal was at the Home Depot on Powell Avenue, in Nashville, when he observed Sedeh walking out of the store wearing a shirt with U.S. Marshals Service (USMS) markings, including embroidered markings, patches and collar insignia. Sedeh was also observed to have a badge holder on a neck chain with a USMS patch attached to it and was wearing a holstered firearm and handcuffs on his hip.
The Deputy Marshal followed Sedeh from the store and asked him if he worked for the U.S. Marshals Service. Sedeh answered yes and stated he was assigned to the Nashville office. Sedeh was asked to produce his credentials and stated that he did not have them. The Deputy U.S. Marshal then identified himself and upon further inquiry, Sedeh stated he worked for the Williamson County Sheriff’s Department and was also a “freelance” bail bondsman and had worked for Grumpy’s Bail bonds. These claims were found to be false and Sedeh had no affiliation with these agencies or the USMS. The Deputy U.S. Marshal also observed Sedeh’s vehicle to have a law enforcement association sticker on it and shirts hanging inside with law enforcement insignias as well as ballistic vest carriers with U.S. Marshal insignias attached.
On November 28, 2018, the U.S. Marshals Service executed a federal search warrant at Sedeh’s home in Franklin, Tennessee and recovered a variety of clothing items marked with USMS insignias and other law enforcement tactical and service equipment.
Sedeh also impersonated a Deputy U.S. Marshal on other occasions, including between September 28, 2018 and October 4, 2018; on November 15, 2018; and between November 25, 2018 and December 10, 2018.
Sedeh faces up to three years in prison on each count of impersonation and up to five years in prison for making false statements and a $250,000 fine on each count when he is sentenced on October 21, 2019.
This case was investigated by the U.S. Marshals Service and is being prosecuted by Assistant U.S. Attorney Chris Suedekum.
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Department of Justice Files Statement of Interest in Maine First Amendment CaseRead the Press Release
The Department of Justice today filed a Statement of Interest in the U.S. District Court for the District of Maine supporting students who claim that the State discriminated against them in violation of the Free Exercise Clause of the U.S. Constitution when it barred them from a program paying the public or private school tuition of students who do not have public schools in their school districts, because the students wish to use the tuition to attend private religious schools that otherwise satisfy State education requirements.
The case, Carson v. Makin, was brought by students and their parents challenging their exclusion from the Maine tuition program. In Maine, 143 of the State’s 260 school districts do not operate their own high schools. Such school districts may arrange for another school to teach all of their students, or these school districts may provide tuition payments to allow families to go to the public school or private school of their choice. The State, however, forbids students in the tuition program to attend “sectarian” schools.
“Under the Constitution, governments may not exclude students from education programs solely because of their religious status or their religious choices,” said Assistant Attorney General Eric Dreiband. “The Department of Justice is committed to ensuring that all children and their families may participate in benefit programs without discrimination based on their faith.”
The United States’ Statement of Interest emphasizes that excluding otherwise eligible students from the program because they attend religious schools violates the First Amendment, as recently explained by the Supreme Court two years ago in Trinity Lutheran Church of Columbia v. Comer. In Trinity Lutheran, the Supreme Court held that “denying a generally available benefit solely on account of religious identity imposes a penalty on the free exercise of religion,” and may only be justified by the most compelling governmental interests, which, the brief argues, Maine cannot show here. Preferring secular private schools that meet the academic requirements set forth in Maine law to religious schools that meet those same requirements, the United States’ brief concludes, cannot be reconciled with the Supreme Court’s decision in Trinity Lutheran.
Today’s filing addresses issues set forth in the Department of Justice’s Guidance on Federal Law Protections for Religious Liberty issued on Oct. 6, 2017, at the direction of President Trump’s May 4, 2017, Executive Order Promoting Free Speech and Religious Liberty. The Department of Justice Guidance states that “government may not target persons or individuals because of their religion” and observes that “constitutional protections for religious liberty are not conditioned upon the willingness of a religious person or organization to remain separate from civil society . . . Individuals do not give up their religious-liberty protections by providing or receiving social services, education, or healthcare.”
In July 2018, the Department of Justice announced the formation of the Religious Liberty Task Force. The Task Force brings together Department components to coordinate their work on religious liberty litigation and policy, and to implement the Attorney General’s 2017 Religious Liberty Guidance.
Defendant Guilty of 1997 Kidnapping and Traveling with Intent to Engage in Sexual Act with A JuvenileRead the Press Release
MUSKOGEE, OKLAHOMA - The United States Attorney’s Office for the Eastern District of Oklahoma announced that Defendant Henri Michelle Piette, age 63, was found guilty by a federal jury of Kidnapping and Travel with Intent to Engage in Sexual Act with a Juvenile. The verdict was reached on Thursday, June 6, 2019, following a seven-day trial. The defendant was indicted by a Federal Grand Jury in December 2017.
Evidence presented at trial showed the defendant had kidnapped the victim from Poteau, Oklahoma, in 1997 where she had been living with her mother, who had been in a relationship with the defendant. Over the course of the nearly 20 years that followed, the defendant repeatedly raped and inflicted physical and emotional abuse upon the victim. The victim gave birth to nine children, the first being born in 2000 when she was 15 years old. In July 2016 the victim was able to escape with her children to the United States Consular General Offices in Nogales, Mexico. The Federal Bureau of Investigation was notified and the investigation began.
During the trial, witnesses testified the defendant had moved with the victim and children dozens of times within the United States and Mexico. He used numerous aliases and forced the victim to use aliases and dye her hair black and wear glasses to change her appearance. He controlled the victim by violence, threats of violence, and sexual abuse against her and her children.
Assistant United States Attorneys Edward Snow and Sarah McAmis represented the United States. The investigation was conducted by the Federal Bureau of Investigation, the United States Department of State Diplomatic Security Service, the U.S. Attorney’s Office and the District Attorney’s Office for Oklahoma’s 27th Prosecutorial District.
“The victim endured two decades of horrific abuse by the defendant. Her courage lead her to escape and rescue her children and allowed investigators and prosecutors to seek justice on her behalf. Ultimately her courage ended the defendant’s reign of terror,” said United States Attorney Brian J. Kuester. “I know this verdict cannot heal the countless wounds inflicted by the defendant. It should prevent him from ever inflicting more.”
“The FBI Oklahoma City Division, and the special agents who investigated this crime, hope that the guilty verdict delivered against Henri Piette will bring some sense of closure to those he inflicted immeasurable mental and physical abuse upon for over 20 years. By bringing Mr. Piette to justice, the victims of his heinous acts can now begin the process of healing. The FBI is honored to have been a part of this long-term investigation alongside our federal, state, and local law enforcement partners.” said Acting Special Agent in Charge Steven D’Antuono, FBI Oklahoma City Division.
The Honorable Ronald A. White, District Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, presided over the trial. Sentencing will be scheduled following the completion of a presentence report.
Creating and Distributing Child Pornography Videos Lands Ponca City Man in Prison for Forty YearsRead the Press Release
OKLAHOMA CITY – STEVEN MARIO ALFORD ORECCHIO, 46, of Ponca City, has been sentenced to forty years in federal prison for distributing on the Internet videos of his own graphic sexual abuse of minors, announced United States Attorney Timothy J. Downing.
On August 21, 2018, a federal grand jury brought three counts against Orecchio based on conduct between February 2013 and November 2016. Counts 1 and 2 charged him with producing and distributing child pornography photographs and videos of a minor identified as Jane Doe #1. Count 3 charged him with producing and distributing a child pornography video of a minor identified as Jane Doe #2. As stated during court proceedings, Orecchio distributed these images to others on the "Dark Web."
The U.S. Marshals Service took custody of Orecchio on September 10, 2018, when he left state custody based on state charges in Kay County arising from the same conduct.
Orecchio pleaded guilty to Counts 2 and 3 on November 28, 2018. Pursuant to a plea agreement, the government has dismissed Count 1.
Today, U.S. District Judge David L. Russell sentenced Orecchio to 480 months, or 40 years, in prison. The court explained it fashioned the sentence so that Orecchio would be in his eighties when released. Although federal prisoners can earn limited credits for good behavior, parole has been abolished in the federal system. After release from prison, Orecchio will serve any remaining years of his life on supervised release and be required to register as a sex offender.
"The innocence stolen from these children through unspeakable acts can never be restored," said U.S. Attorney Downing. "This conviction and sentence will not only hold Mr. Orecchio accountable for his crimes, it will also ensure that he will never again victimize another child. I am committed to working with our state partners to keep defendants like this one away from children and to seek sentences that will deter others from harming children in such an egregious way."
This case is the result of an investigation by the Oklahoma State Bureau of Investigation’s Internet Crimes Against Children Task Force, which includes agents and officers from Homeland Security Investigations, the Oklahoma Attorney General’s Office, the Ponca City Police Department, and the Tulsa Police Department, with the assistance from Brian Hermanson, District Attorney for Kay and Noble Counties, as well as law enforcement officers in New Zealand and Australia. It was prosecuted by Assistant U.S. Attorney Brandon Hale.
This case is also part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Child Exploitation and Obscenity Section of the Department of Justice, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Reference is made to public filings for further information.
Convicted Felon Sentenced for Trafficking Heroin and Possessing FirearmRead the Press Release
RICHMOND, Va. – A Henrico man was sentenced today to 15 years in prison for trafficking over 200 grams of heroin and for possessing a firearm as a convicted felon.
“Drug traffickers in possession of firearms pose a significant threat to our communities,” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “Investigating and prosecuting heroin and fentanyl trafficking crimes is a top priority of this office as we continue to battle this deadly epidemic. We are committed to our mission of public safety and will continue to aggressively pursue those who choose to endanger the safety of the communities we serve.”
According to court documents, Mervin Turner, 37, distributed heroin and fentanyl to a confidential source from his Henrico County residence on two separate occasions in 2018. In August 2018, law enforcement executed a search warrant at Turner’s residence and recovered a semi-automatic pistol loaded with a 100-round drum magazine, more than 200 grams of heroin, two stand-up shop presses used to package heroin, marijuana, digital scales, and more than $9,000.
Operation California Dreamin was investigated as part of the Organized Crime and Drug Enforcement Task Force (OCDETF). The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking, weapons trafficking, and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
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, Jesse R. Fong, Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division, and William C. Smith, Interim Chief of Richmond Police, made the announcement after sentencing by U.S. District Judge John A. Gibney, Jr. Assistant U.S. Attorneys Erik S. Siebert and Kenneth Simon 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 is 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-158.
Convicted Felon Pleads Guilty to Fraud Scheme Involving Local NewspaperRead the Press Release
ALEXANDRIA, Va. – A previously convicted felon pleaded guilty this morning to charges related to defrauding investors of a local newspaper and unlawful possession of firearms by a previously convicted felon.
According to court documents, Brian Thomas Reynolds, 52, of Leesburg, defrauded both investors and lenders to a company that he controlled that operates a local newspaper in Loudoun County. Reynolds made several materially false and fraudulent representations to actual and potential investors and lenders regarding the existence and value of advertising contracts held by the company, and created fake advertising contracts when no such agreements existed. Reynolds also made materially false and fraudulent representations regarding the company’s historical advertising revenues and the amount of money that Reynolds and others had invested in the company, falsely claimed that another individual had agreed to “match” the investments of certain investors, falsely claimed to at least one investor that the company lacked any debt, and materially overstated the amount of money held by the company in its bank accounts.
Court documents also state that Reynolds created altered loan documentation to defraud an individual who had lent money to the company by changing the language of the loan agreement to conditions that were materially more favorable to Reynolds and his company than had actually been agreed to by the lender. Reynolds also made materially false representations regarding the number of issues previously distributed by the newspaper, and falsely claimed that a prominent businessperson served on the company’s advisory board, when in fact that individual held no position on the board and played no role in the operation of the business.
Reynolds, who has four prior felony convictions and is prohibited from possessing firearms, also pleaded guilty to unlawfully possessing seven firearms and associated ammunition.
Reynolds pleaded guilty to one count of wire fraud and one count of unlawful possession of firearms by a previously convicted felon. He faces a maximum penalty of 20 years in prison for the wire fraud count and a maximum penalty of 10 years in prison for the firearms count when sentenced on September 13. 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.
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, and Charles Dayoub, Acting Special Agent in Charge, Criminal Division, FBI Washington Field Office, made the announcement. Assistant U.S. Attorney Matthew Burke and Special Assistant U.S. Attorney Russell L. Carlberg are 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 is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case Nos. 1:19-cr-70 and 1:19-cr-71.
Citrus Heights Man Sentenced to over 24 Years in Prison for Receipt of Child PornographyRead the Press Release
SACRAMENTO, Calif. — U.S. District Judge Kimberley J. Mueller sentenced Emanuel Mois, 26, of Citrus Heights today to 24 years and four months in prison to be followed by a lifetime term of supervision, for receipt of child pornography, U.S. Attorney McGregor W. Scott announced.
According to court documents, between November 2016 and February 2017, Mois knowingly received and saved images depicting children engaged in sexually explicit activity onto his cellphone. At the time he received the images, Mois was on parole monitor for a state conviction for child pornography and was required to wear an ankle monitor. In addition, he had a prior state conviction for sexual battery of a minor.
In pronouncing the sentence, Judge Mueller cited Mois’ aggravated criminal history, which included numerous offenses against children, and the need to protect the public from someone who appears to be “a sexually deviant child predator.”
“Child pornography is the end-product of the victimization of our communities’ youngest and most vulnerable members,” said Special Agent in Charge Sean Ragan of the FBI Sacramento Field Office. “It is a crime that can have an effect on victims well after the material is initially produced and distributed. Mois’ actions are particularly concerning since he was on parole for assaulting a child at the time he was found with child pornography. The FBI is committed to working with our local, state, and federal law enforcement partners to ensure anyone who produces, obtains or shares such exploitive and illegal content faces justice to both punish those who exploit children but also to deter the behavior.”
This case was the product of an investigation by the FBI, the Citrus Heights Police Department, and the Roseville Police Department. Assistant U.S. Attorney Amy Schuller Hitchcock prosecuted the case.
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 those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. Click on the “resources” tab for information about internet safety education.
Canon Inc., Toshiba Corporation Agree to Pay $5 Million for Violating Federal Antitrust LawsRead the Press Release
Canon Inc. and Toshiba Corporation have agreed to settle federal charges that the companies violated the premerger notification and waiting period requirements of the Hart-Scott-Rodino Act (HSR Act), when Canon acquired Toshiba Medical Systems Corporation from Toshiba in 2016.
The companies will pay $2.5 million each to settle the charges. The settlement also requires the companies to implement HSR compliance programs and comply with inspection and reporting requirements, among other obligations imposed under the consent order.
The complaint alleges that Canon and Toshiba devised a scheme to avoid observing the waiting period required by the HSR Act for Canon’s acquisition of Toshiba’s subsidiary Toshiba Medical Systems Corporation (TMSC). According to the complaint, the scheme devised by Canon and Toshiba “had no purpose” other than to complete the sale of TMSC prior to March 31, 2016, and avoid the HSR Act’s waiting period requirements.
The complaint further alleges that long-running financial irregularities at Toshiba became public in 2015 and, as a result, Toshiba was facing financial difficulty. To shore up its financial statement, Toshiba needed to recognize the proceeds of the sale of TMSC by the end of its 2015 fiscal year on March 31, 2016. The complaint also alleges that, by Canon’s and Toshiba’s own admission, Canon could not acquire TMSC outright because “it simply was not possible to complete a significant acquisition of TMSC voting securities before the end of Toshiba’s fiscal year due to the review periods under various merger control laws.”
“The HSR Act is an essential tool for antitrust enforcement because it allows federal antitrust enforcers to review proposed acquisitions for potential anticompetitive effects before they occur. Canon and Toshiba structured their transaction for the purpose of avoiding the HSR Act’s requirements,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division. “An acquiring person may not enlist a third party to make an acquisition on its behalf to evade the HSR Act.”
“The prior notice provisions of the HSR Act are designed to allow the agencies to analyze a proposed transaction before it is consummated to determine whether it will harm competition,” said Bruce Hoffman, Director of the Federal Trade Commission’s Bureau of Competition. “Deliberately structuring a transaction to avoid or delay HSR filing undermines the efficacy of the premerger notification process, regardless of whether the parties’ motives for doing so in a particular case were anticompetitive. We will be vigilant in seeking relief against attempts to circumvent the HSR Act’s filing requirements.”
The HSR Act imposes notification and waiting period requirements for transactions meeting certain size thresholds so that they can undergo premerger antitrust review. The maximum civil penalty for an HSR violation is currently $42,530 per day.
The Department of Justice filed the complaint and proposed final judgment in the U.S. District Court for the District of Columbia on June 10, 2019.
As required by the Tunney Act, the proposed settlement, along with a competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement during a 60-day comment period to Kenneth A. Libby, Special Attorney, United States, c/o Federal Trade Commission, 600 Pennsylvania Avenue, NW, Washington, DC 20580 [email protected]. At the conclusion of the 60-day comment period, the U.S. District Court for the District of Columbia may approve the proposed settlement upon finding that it is in the public interest.
Brooke County nurse sentenced for illegal drug distributionRead the Press Release
WHEELING, WEST VIRGINIA – Sharon E. Jackson, of Wellsburg, West Virginia, was sentenced on May 30, 2019 to two years probation for distributing drugs illegally, United States Attorney Bill Powell announced.
Jackson, age 46, a registered nurse, pled guilty to one count of “Conspiracy to Distribute Controlled Substances Outside the Bounds of Professional Medical Practice” in December 2017. Jackson admitted to conspiring with others to illegally distribute suboxone, subutex, and buprenorphine, controlled substances used to treat opioid addiction. Jackson admitted to committing the crime while operating at an opioid addiction treatment center, Advance Healthcare, Inc., in Weirton, West Virginia from 2007 until 2017.
Jackson was also ordered to pay $100,000 in a money judgment.
Assistant U.S. Attorneys Sarah E. Wagner and Robert H. McWilliams, Jr. prosecuted the case on behalf of the government. The Federal Bureau of Investigation and the Drug Enforcement Administration investigated.
U.S. District Judge John Preston Bailey presided.
British Man Found Guilty of Participating in Fraudulent Investment Scheme Related to Co-Working BusinessRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that JAMES MOORE was convicted at trial last Friday of wire fraud and conspiracy for engaging in a scheme to defraud investors by making material misrepresentations about the management and operations of a company called Bar Works Inc. and related entities (“Bar Works”). MOORE was found guilty on June 7, 2019, of both counts he faced, after a one-week trial before the U.S. District Judge Richard M. Berman.
Manhattan U.S. Attorney Geoffrey S. Berman said: “James Moore was part of a ring of insiders who helped conceal that Bar Works was run by a known fraudster. Innocent and unaware investors lost millions of dollars thanks to his contributions to the scheme. We will continue to work with our law enforcement partners to bring to justice those who prey upon the investing public.”
According to the Complaint and Indictment in the case and evidence presented at trial:
From 2015 to 2016, MOORE and others partnered with Renwick Haddow, who is also a British citizen, in soliciting investments into workspace leases in a co-working business called Bar Works through material misrepresentations concerning, among other things, the identity of Bar Works’ management. Previously, Haddow had been disqualified as a director of any United Kingdom company for eight years, and was sued by the Financial Conduct Authority, a British regulator, for operating investment schemes that lost investors substantially all of their money. These sanctions and lawsuit were publicized extensively online.
In order to conceal his role at Bar Works because of the negative publicity on the internet related to past investment schemes and government sanctions in the U.K., Haddow adopted the alias “Jonathan Black.” Notwithstanding Haddow’s control over Bar Works, MOORE and others knowingly distributed the Bar Works offering materials listing Black as the Chief Executive Officer of Bar Works and claiming that Black had an extensive background in finance and past success with start-up companies. As MOORE well knew, “Jonathan Black,” was an entirely fictitious person, created to mask Haddow’s control of Bar Works. Among other things, MOORE helped devise pitch materials that contained the misrepresentation, coordinated a substantial sales force to recruit investors knowing that the materials contained the falsehood, advised Haddow as to how to continue to conceal the truth concerning the identity of “Jonathan Black,” and affirmatively represented to agents for investors that he was communicating with CEO “Jonathan Black.” MOORE also received in excess of $1.6 million in commissions for his participation in the scheme.
Last month, U.S. Attorney Berman announced the unsealing of a guilty plea, on May 8, 2019, by Haddow in which he admitted to his own involvement in the fraudulent scheme related to Bar Works, as well as to making material misrepresentations and misappropriating investment funds in another company created by Haddow called Bitcoin Store Inc. (“Bitcoin Store”), and agreed to cooperate with the Government. Haddow’s case has been assigned to U.S. District Judge Laura Taylor Swain.
Further, last month Mr. Berman also announced the unsealing of charges against
Savraj Gata-Aura, another citizen of the United Kingdom, in connection with the same scheme. As alleged in the Superseding Indictment containing those charges, Gata-Aura also partnered with Haddow in soliciting investments into workspace leases through material misrepresentations similar to MOORE’s by affirmatively misrepresenting that “Jonathan Black” ran the company. Overall, the scheme is believed to have fraudulently raised more than $50 million from unwitting investors.
* * *
MOORE, 58, of the United Kingdom and Miami, Florida, was convicted of one count of wire fraud and one count of wire fraud conspiracy. Each charge carries a maximum sentence of 20 years in prison.
Savraj Gata-Aura, a/k/a “Sam Aura,” 33, of the United Kingdom and New York City, has been charged with one count of wire fraud and one count of wire fraud conspiracy relating to the Bar Works scheme. Each charge carries a maximum sentence of 20 years in prison.
Haddow, 50, pled guilty to one count each of wire fraud and wire fraud conspiracy relating to the Bar Works scheme, and one count each of wire fraud and wire fraud conspiracy relating to the Bitcoin Store scheme. Each charge carries a maximum sentence of 20 years in prison.
The statutory maximum penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendants would be determined by the respective judges. The charges against Gata-Aura are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Mr. Berman praised the investigative work of the FBI and thanked the Securities and Exchange Commission, which has separately brought civil actions against MOORE, Haddow, and Gata-Aura, for its assistance.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Vladislav Vainberg and Martin S. Bell are in charge of the prosecution.
Annapolis MS-13 Member Sentenced to 24 Years in Federal Prison for a Racketeering Conspiracy and for Discharging a Firearm Related to His MS-13 Gang ActivitiesRead the Press Release
Baltimore, Maryland – Chief U.S. District Judge James K. Bredar sentenced Manuel Martinez-Aguilar, a/k/a “El Lunatic” and “Zomb”, age 20, of Annapolis, Maryland, today to 24 years in federal prison, followed by five years of supervised release, for conspiracy to participate in a racketeering enterprise and for using, carrying, and discharging a firearm during a crime of violence, in connection with his MS-13 gang activities.
The sentence was announced by United States Attorney for the District of Maryland Robert K. Hur; Assistant Attorney General Brian Benczkowski of the Justice Department’s Criminal Division; Acting Special Agent in Charge Cardell T. Morant of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI) Baltimore Office; Special Agent in Charge Rob Cekada of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Baltimore Field Division; Chief Timothy J. Altomare of the Anne Arundel Police Department; and State’s Attorney Anne Colt Leitess of the Anne Arundel County State’s Attorney Office.
MS-13 is a gang composed primarily of immigrants or descendants of immigrants from El Salvador, with members operating in the State of Maryland, including Anne Arundel County, Montgomery County, Prince George’s County, and Frederick County, and throughout the United States. Branches or “cliques” of MS-13 often work together cooperatively as “Programs,” with the purpose of increasing the gang’s levels of organization, violence, extortion, and other criminal activity, and to assist one another in avoiding detection by law enforcement. In Maryland and the surrounding area, these cliques include Hempstead Locos Salvatruchas (“HLS”), Parkview Locos Salvatrucha (“PVLS”), Normandie Locos Salvatrucha (“NLS” or “Normandie”), Sailors Locos Salvatrucha Westside (“SLSW” or “Sailors”), Langley Park Salvatrucha (“LPS”), Weedoms Locos Salvatrucha (“Weedoms”), and Cabanas Locos Salvatruchas (“Cabanas”). A person within the participating cliques is selected as the Program leader.
To protect the gang and to enhance its reputation, MS-13 members and associates are expected to use any means necessary to force respect from those who show disrespect, including acts of intimidation and violence. MS-13’s creed is based on one of its mottos, “Mata, roba, viola, controla,” which translates to, “kill, steal, rape, control.” One of the principal rules of MS-13 is that its members must attack and kill rivals, known as “chavalas,” whenever possible.
According to Martinez-Aguilar’s plea agreement, prior to 2015, and continuing through 2017, Martinez-Aguilar was a member and associate of the Hempstead clique of MS-13, and participated in a racketeering conspiracy that included assaults, murder, attempted murder, robbery, and drug trafficking. For example, Martinez-Aguilar conspired to and attempted to murder two victims in Annapolis, for the purpose of gaining entrance to, maintaining, and increasing position in MS-13.
As detailed in his plea agreement on October 23, 2016, Martinez-Aguilar and other MS-13 members met in a park to discuss the plan to murder Victim 2, an unlicensed cab driver who was believed to be a member of a rival gang. At the meeting, each member of the conspiracy was assigned a task to complete the murder and dispose of the evidence. The group planned to use machetes, knives, and guns to kill the victim. All the members of the conspiracy, including Martinez-Aguilar, were aware that guns would be used in the murder. Martinez-Aguilar and another MS-13 member were tasked with disposing of Victim 2’s vehicle after the murder. The group planned to bury the victim’s body in the park.
According to the plea agreement, a member of the conspiracy called Victim 2 using another member’s cell phone to arrange for an unlicensed taxi ride. Victim 2 arrived with another passenger, Victim 3. The conspirator asked Victim 2 to drive to the area of 700 block of Annapolis Neck Road in Annapolis. When they arrived, another MS-13 member approached the vehicle and pointed a gun at the victims and the MS-13 member in the car also produced a gun and pointed it at the victims. Victim 3 attempted to run away and was shot in the leg, while another MS-13 member attacked the victim with a machete. Victim 2 also tried to run. Martinez-Aguilar and another MS-13 member took Victim 2’s vehicle and attempted unsuccessfully to run him over with the car. Two MS-13 members chased Victim 2 and repeatedly struck Victim 2 with a sharp instrument, causing stab wounds. The conspirators fled when they heard police sirens. Both victims were transported to the University of Maryland Shock Trauma Center with life threatening injuries. Both victims survived but have permanent injuries as a result of the attack.
On October 24, 2016, police detectives located Victim 2’s car, which smelled of gasoline. Officers recovered burned cigarettes from the car the contained DNA from Martinez-Aguilar.
Further, Martinez-Aguilar admitted that between January 2016 and February 2017, he and other members of MS-13 sold cocaine and marijuana to raise funds for the gang. The proceeds were used for the purchase of more narcotics, weapons, and to send to MS-13 members and associates in other states and in El Salvador, among other purposes.
Co-defendant David Diaz-Alvarado, age 20, pleaded guilty to murder in aid of racketeering related to a murder committed on March 11, 2016, in connection with his MS-13 gang activities. Charges remain pending against four other co-defendants, who all remain detained pending trial.
United States Attorney Robert K. Hur commended HSI, ATF, Anne Arundel Police Department, and Anne Arundel State’s Attorney Office. Mr. Hur thanked Assistant U.S. Attorney Zachary Stendig, Trial Attorney Matthew Hoff of the Criminal Division’s Organized Crime and Gang Section, as well as Special Assistant U.S. Attorney Samantha Mildenberg, who are prosecuting this Organized Crime Drug Enforcement Task Force case.
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ATM Installer Sent to Prison for Tax EvasionRead the Press Release
A Tulsa man, who attempted to prevent the Internal Revenue Service (IRS) from collecting more than $200,000 in taxes, penalties and interest he owed for 2005, and didn’t file tax returns for the years 2006 through 2012, despite earning commissions totaling nearly $5 million during these years, was sentenced in federal court in Tulsa, Oklahoma, today by U.S. District Court Judge Gregory Frizzell to 24 months in prison, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Trent Shores.
John D. Petrig, 49, of Tulsa, pleaded guilty on Feb. 5, 2019, to one count of tax evasion. From 2000 to 2012, Petrig worked for a company as an independent contractor installing ATM machines inside casinos. The company paid him commissions based on the number of transactions that were executed at the ATMs. In 2012, Petrig filed his 2005 tax return with the IRS, reporting a tax due of just over $110,000. In fact, Petrig owed taxes, penalties and interest of more than $217,000 and took steps to evade payment of those funds. When the IRS sent a levy to his employer, Choice ATM Enterprises, directing his commission payments be sent to the IRS to pay his 2005 tax debt, Petrig instructed Choice to pay his future commission payments to a nominee entity, and thereby prevent those funds from being used to satisfy his tax debt. According to court documents, Petrig earned commissions totaling nearly $5 million for the years 2006 through 2012, but did not file tax returns for any of those years.
“Evading the payment of taxes constitutes serious criminal activity,” stated Principal Deputy Assistant Attorney General Zuckerman. “In partnership with the United States Attorney’s Office and IRS-Criminal Investigation, the Tax Division is committed to holding tax evaders accountable for such criminal activity and seeking prison sentences for such crimes.”
“Petrig tried to beat the system and lost. Over a seven year period, he earned a commission income of almost $5 million and failed to pay the nearly $1 million owed in income taxes. When the United States attempted to collect those back taxes, he directed his commission payments to be sent to fictitious corporations,” said U.S. Attorney Trent Shores. “This egregious behavior warrants the sentence Judge Frizzell handed down today in federal court. Tax evaders beware, your criminal conduct will be brought to light, investigated, and prosecuted by the Department of Justice.”
In addition to prison, Petrig was ordered to pay restitution to the IRS in the amount of $974,350.48 and to serve three years of supervised release after completion of his sentence.
The Department of Treasury, Internal Revenue Service-Criminal Investigation investigated the case. Special Assistant U.S. Attorney/ Assistant Chief Andrew J. Kameros of the Tax Division and Assistant U.S. Attorneys Charles M. McLoughlin and Victor S. Régal prosecuted the case.
"Tech Support" Telemarketing Scheme Leader SentencedRead the Press Release
PROVIDENCE – A college intern from India who led a group of college students in Newport in their participation in a “tech support” fraud scheme that duped close to two dozen individuals out of nearly a million dollars was sentenced today in federal court in Providence to 60 months in federal prison and ordered to re-pay his victims, announced United States Attorney Aaron L. Weisman, Newport Police Chief Gary T. Silva, and Homeland Security Investigations (HSI) Special Agent in Charge Peter C. Fitzhugh.
The Newport-based operation was tied to a large-scale telemarketing operation based in India.
Bishwajeet Kumar Jha, 21, and several other interns from the same college in India who were in the United States on hospitality industry internships defrauded a number of individuals of their retirement savings. The victims ranged in age from 58 years-old to 93 years-old and were duped out of between $1,180 dollars and $174,300 dollars. Over approximately three-months, the conspiracy defrauded individuals of at least $937,280.
The victims, who believed that they had purchased technology support, were led to believe that money had been erroneously refunded to their bank accounts by the tech support company. The victims were asked to return the erroneous refund and directed to send the money to the defendant and others. Some of the victims were told to send the money overseas.
The scheme was interrupted by Newport Police on November 20, 2018, when, as part of the investigation, detectives executed a court-authorized search of the residence of Jha and the other members of the conspiracy.
During the court-authorized search, Newport Police seized numerous items related to the operation of the telemarketing scheme. A subsequent investigation by members of the Newport Police Department and HSI agents determined that after the co-conspirators operating in Newport shared some of the proceeds of the scheme, large sums of money garnered from the scheme were transferred to a bank account in California. From there, the majority of funds were transferred internationally to India, China, and Singapore.
“The Department of Justice takes very seriously, and will advocate for the imposition of substantial criminal penalties for targeting vulnerable, especially elderly, victims through the commission of federal crimes such as this,” said United States Attorney Aaron L. Weisman. “Investigations like this one by the Newport Police Department and Homeland Security Investigations show the strength of law enforcement working together to identify and hold accountable those whose mission it is to steal, and in some instance bankrupt, the elderly and most vulnerable in our community.”
Newport Police Chief Gary T. Silva commented, “This type of criminal activity is disturbing. Those who prey on citizens, particularly those citizens who are vulnerable, are deliberately calculating in their persistent efforts to defraud honest people. This investigation and successful prosecution of those responsible should provide notice to others contemplating similar acts that law enforcement and prosecutors are committed to actively bring to justice those responsible.”
“Today’s sentence is fitting and appropriate in light of the serious nature of the charges this defendant was convicted of,” said Peter C. Fitzhugh, Special Agent in Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, Boston. “HSI remains strongly committed to investigating those who wrongly believe they can exploit the generous nature of our immigration system to scam Americans via financial fraud schemes.”
At sentencing, U.S. District Court Judge John J. McConnell, Jr., sentenced Jha to 60 months in prison. A restitution order will be issued by the Court at a later date.
Jha will face deportation proceedings upon completion of his term of incarceration.
The case is being prosecuted by Assistant U.S. Attorney Sandra R. Hebert.
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9 June 2019
Former Executive Director of Lessie Bates Davis Neighborhood House Indicted for EmbezzlementRead the Press Release
A federal grand jury for the Southern District of Illinois has returned an indictment charging Christopher K. Coleman, 42, of Troy, Illinois, with embezzlement from the Lessie Bates Davis Neighborhood House, an organization that receives federal funds. The indictment alleges that Coleman embezzled the funds from July 2016 to December 2017, while he was serving as the organization’s executive director. The indictment further alleges that Coleman concealed his crime by creating and using false invoices.
According to the indictment, the Lessie Bates Davis Neighborhood House is a non-profit, faith-based organization in East St. Louis, Illinois, whose mission is to improve the quality of life for residents of all ages by providing quality early childhood development services, comprehensive youth services, individual and family support services, services to older adults, and housing economic development services, which will help move individuals and families out of poverty.
Embezzling money from an organization that receives federal funds carries a maximum sentence of ten years in prison, a fine of up to $250,000, and restitution. Coleman is scheduled to make his initial appearance at the federal courthouse in East St. Louis, Illinois, on June 25, 2019.
An indictment is merely a formal charge against a defendant. Under the law, a defendant is presumed to be innocent of a charge until proven guilty beyond a reasonable doubt to the satisfaction of a jury.
The investigation was conducted by the Southern Illinois Public Corruption Task Force, which consists of agents with the FBI, Internal Revenue Service/Criminal Investigation, and the Illinois State Police. The prosecution is being handled by Assistant U.S. Attorney Norman R. Smith. Citizens are encouraged to report suspicions of public corruption to the Southern Illinois Public Corruption Task Force Tip Line at (618) 589-7373.
7 June 2019
Westford Man Charged with Fraud and Embezzlement SchemeRead the Press Release
BOSTON – The former CEO and co-founder of a Boston-based mobile phone music streaming service, was charged in connection with a scheme to embezzle hundreds of thousands of dollars from his employer.
David Fondots, 56, was charged by criminal complaint on one count of wire fraud. Fondots was arrested yesterday evening and made an initial appearance in federal court in Boston this afternoon.
According to the complaint affidavit, Fondots misappropriated company funds which he used for his personal benefit. It is alleged that between 2014 through 2016, Fondots caused his company to pay significant sums of money directly to himself, to a family member, and to companies controlled by a family member. Fondots used the embezzled funds to pay personal expenses for himself and his family, including car payments, legal fees, and travel, among other things.
The charge of wire fraud provides for a sentence of no greater than 20 years in prison, three years of supervised release, and a fine of $250,000, or twice the gross gain or loss. 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 Office; and Kristina O’Connell, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston made the announcement today. Assistant U.S. Attorney Sara Miron Bloom of Lelling’s Securities & Financial Fraud Unit is prosecuting the case.
The details contained in the complaint are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Wagner Man Convicted of Sexual AbuseRead the Press Release
United States Attorney Ron Parsons announced that Jeremy Aungie, age 33, of Wagner, South Dakota, was found guilty of two counts of Aggravated Sexual Abuse of a Child, as a result of a federal jury trial in Sioux Falls, South Dakota. The verdict was returned on June 5, 2019.
The charges carry a maximum penalty of life in federal prison and/or a $500,000 fine, up to life of supervised release, and a $200 special assessment to the Federal Crime Victims Fund.
Aungie was indicted by a federal grand jury on June 6, 2018.
From on or about June 22, 2012, until on or about May 16, 2018, Aungie sexually abused a juvenile female from the time she was 8 years old until she was 13 years old. They lived together in a house in Wagner. The sexual abuse was often accompanied by physical abuse such as hitting, slapping, pulling of hair, and choking.
This case was investigated by the Federal Bureau of Investigation. Assistant U.S. Attorneys Jeffrey C. Clapper and Ann M. Hoffman prosecuted the case.
A presentence investigation was ordered and a sentencing date was set for August 19, 2019. The defendant was remanded to the custody of the U.S. Marshals Service.
United States Settles False Claims Act Cases Against Home Health AgencyRead the Press Release
Tampa, FL – The United States has settled two cases against Nurse on Call, a home health agency with locations in Sarasota and Orlando, that allege False Claims Act violations arising from having a medical director approve care for patients without having seen the patients, the alleged payment of kickbacks in the form of a sham medical director agreement, and payments to the spouses of referring physicians.
Nurse on Call allegedly paid kickbacks in the form of a sham medical directorship to a physician to refer patients to Nurse on Call. The physician allegedly did little, if any, of the work for which Nurse on Call paid him as medical director. Sham medical director agreements to induce patient referrals violate the Anti-Kickback Statute and the Stark Law. Nurse on Call also allegedly paid some employees in a manner that accounted for the volume of referrals by their physician spouses, in violation of the Stark Law. Finally, Nurse on Call allegedly requested another medical director to approve plans of care for patients whom the director never saw, in violation of Medicare regulations.
“The Anti-Kickback Statute and the Stark Law help to ensure that financial interests do not compromise the medical decision-making process,” said U.S. Attorney Maria Chapa Lopez. “Additionally, Medicare regulations requiring physicians to have face-to-face contact with patients helps to ensure that any care provided is necessary and reasonable. Our office will continue to use every tool at our disposal to combat fraud and abuse in our health care programs.”
The Anti-Kickback Statute prohibits anyone from offering or paying remuneration in order to induce or reward referrals for services paid for under federal healthcare programs. The Stark Law forbids certain medical providers, including home health agencies, from submitting claims to Medicare for services provided to patients who were referred by a physician with whom the provider has a prohibited financial relationship, unless that relationship falls within an applicable exception. Finally, Medicare regulations require home health care to be provided pursuant to a plan of care reviewed and approved by a physician who has had recent, face-to-face contact with the patient.
The lawsuits were filed under the qui tam or whistleblower provisions of the False Claims Act, which allow private parties to file suit on behalf of the United States for false claims and receive a share of any recovery. The act permits the United States to intervene in the cases and settle them, as it has done here. A defendant who violates the act is subject to three times the government’s losses, plus applicable penalties.
This case is being handled by Assistant U.S. Attorney Charles Harden of the U.S. Attorney’s Office for the Middle District of Florida, with assistance from the Federal Bureau of Investigation.
The claims made in the complaints are allegations only, and there has been no determination of liability. The cases are captioned U.S. ex rel. Spencer, et al. v. Emeritus Corp., Nurse on Call, et al., Case No. 8:13-cv-3194-T-30-TGW, and U.S. ex rel. Doe v. Nurse on Call, Case No. 8:15-cv-1043-T-17-TBM.
United States Attorney Shores Announces the Hiring of Two New Assistant United States AttorneysRead the Press Release
United States Attorney Trent Shores announced today the appointment of Kristin Harrington as an Assistant U.S. Attorney in the Civil Division and Scott Proctor as an Assistant U.S. Attorney in the Criminal Division for the Northern District of Oklahoma. They are scheduled to be sworn in Friday, June 7, at 10:00 a.m., at the United States District Courthouse by Chief United States District Judge John E. Dowdell.
“Kristin and Scott are valuable additions to our justice team here in the Northern District of Oklahoma. Kristin brings extensive experience, knowledge, and passion to the fight against opioids as part of our affirmative civil enforcement unit. Scott - with his service as an officer in the U.S. Navy and education at Harvard - brings a unique blend of mission readiness and legal aptitude to our Indian Country team,” said U.S. Attorney Shores. “We are lucky to have selfless civil servants like Kristin and Scott on our team. They will make a positive impact on our community and help further our mission at the Department of Justice.”
As an Assistant U.S. Attorney for the Affirmative Civil Enforcement unit, Ms. Harrington will prosecute civil actions on behalf of the United States of America to recover damages for fraud and other offenses and impose civil penalties for violations of the federal health, safety and economic welfare laws. One of her primary focuses will be combating the opioid crisis in northeastern Oklahoma. Previously, Ms. Harrington served as an Assistant U.S. Attorney for the Eastern District of Oklahoma. While there, she also served as the Opioid Coordinator, a position responsible for community outreach to address the opioid crisis and prosecution of cases involving opioids, including heroin, fentanyl and other controlled substances. Ms. Harrington has also served at the Oklahoma Attorney General’s Office, prosecuting white collar crime and healthcare matters, and as an Assistant District Attorney for the Tulsa County District Attorney’s Office. Ms. Harrington received her undergraduate degree at DePauw University and her J.D. from the University of Tulsa College of Law.
As a Criminal Division Assistant U.S. Attorney, Mr. Proctor will represent the United States of America in the prosecution of criminal cases in Indian Country. Mr. Proctor joined the office from the Attorney General’s Honors Program, where he was selected as “Indian Country Fellow.” Previously, he clerked for U.S. Circuit Judge Jeffrey Sutton at the United States Court of Appeals for the Sixth Circuit in Columbus, Ohio. He has also worked as an intern at the Justice Department’s National Security Division, Counterterrorism Section, the U.S. Attorney’s Office for the District of Massachusetts, and on Capitol Hill for U.S. Senator Tom Cotton. Mr. Proctor has further served in the United States Navy and Navy Reserve for ten years, attaining the rank of Lieutenant Commander. Mr. Proctor received his undergraduate degree from Yale University and his J.D. from Harvard University where he graduated magna cum laude. While at Harvard, he served as executive editor of the Harvard Law Review.
U.S. Attorney’s Office Launches Project Safe Neighborhoods LubbockRead the Press Release
The U.S. Attorney’s Office for the Northern District of Texas – in partnership with the Lubbock Police Department and a host of other federal, state, and local law enforcement partners – today launched Project Safe Neighborhoods Lubbock, its third PSN initiative in North Texas, announced U.S. Attorney Erin Nealy Cox.
A nationwide program spearheaded by the Justice Department, Project Safe Neighborhoods surges federal and local resources to communities’ most violent neighborhoods in order to root out the area’s worst offenders and build positive relationships with crime victims and witnesses.
The PSN Lubbock Taskforce – which includes officers, agents, and staff from the Lubbock Police Department, Lubbock County Sheriff’s Office, Lubbock County District Attorney’s Office, Texas Department of Public Safety, U.S. Attorney’s Office, Federal Bureau of Investigation, Bureau of Alcohol, Tobacco, Firearms & Explosives, Drug Enforcement Administration, U.S. Marshals Service and Homeland Security Investigations – worked with a university criminologist to analyze city-wide crime data and zeroed in on a violent crime “hotspot” in central Lubbock, west of I-27 and north of the South Loop:
Data showed violent crime –including assault, and robberies – creeping up in the region. Aggravated assaults, for example, rose more than 28% over four years. The Taskforce felt the region could benefit from Project Safe Neighborhood’s three-pronged approach, which combines traditional enforcement with community outreach and recidivism reduction.
To that end, the Taskforce created an email tip line where members of the community can reach out: [email protected]. The inbox is monitored by federal agents who will route comments and concerns to the appropriate authority. Lubbock’s Crime Line will offer monetary rewards for information leading to the successful federal prosecution of PSN crimes in Lubbock.
“Project Safe Neighborhoods is a collaborative initiative that draws upon the collective wisdom of our local, state and federal law enforcement partners to reach a common goal: Reducing violent crime inside the PSN hotspot and citywide,” said U.S. Attorney Erin Nealy Cox. “We’ve found that when crime lacks a geographic locus, it dissipates. And when a community trusts law enforcement, it thrives.”
“The Lubbock Police Department takes the protection of its citizens and their quality of life very seriously. We use all the available tools and resources to bring criminals to justice and make our communities stronger through active engagement,” said Lubbock Police Chief Jerry D. Brewer.
"The FBI is pleased to continue our support for the Project Safe Neighborhoods initiative," said FBI Dallas Special Agent in Charge Matthew J. DeSarno. "We remain committed to working closely with our federal, state, and local law enforcement partners to ensure the safety and well being of the Lubbock community."
To date, the Northern District of Texas has launched two other PSN initiatives: PSN Dallas and PSN Amarillo. Both have proved enormously successful. For more information on PSN, visit: https://www.justice.gov/usao-ndtx/project-safe-neighborhood-psn-revitalized-2018.
U.S. Attorney's Office Reaches ADA Settlement with Danbury Sports FacilityRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, today announced that the U.S. Attorney’s Office has reached a settlement agreement with Danbury Sports Dome in Danbury to resolve allegations that the sports facility was not operating in compliance with the Americans with Disabilities Act of 1990 (“ADA”).
The settlement agreement resolves an ADA complaint filed by the parents of a child with severe food allergies alleging that Danbury Sports Dome refused to admit the child to its summer camp program because of the child’s food allergies. Under the terms of the settlement agreement, Danbury Sports Dome will implement new nondiscriminatory policies, practices and procedures regarding the admission of and programming for children with disabilities who wish to attend their camps, programs, services and activities. Danbury Sports Dome will designate an employee to serve as its ADA coordinator and will train its employees on compliance with Title III of the ADA. Additionally, Danbury Sports Dome will revise its registration materials to inform parents of children with disabilities of their right to request reasonable modifications of the facility’s programs and will post to its website the nondiscrimination policy approved by the U.S. Attorney’s Office.
Under federal law, private entities that own or operate places of “public accommodation,” including gymnasiums and other places of exercise and recreation, are prohibited from discriminating on the basis of disability. The ADA authorizes the U.S. Department of Justice to investigate complaints and undertake periodic reviews of compliance of covered entities. The Justice Department is also authorized to commence a civil lawsuit in federal court in any case that involves a pattern or practice of discrimination or that raises issues of general public importance, and to seek injunctive relief, monetary damages, and civil penalties.
U.S. Attorney Durham noted that the management of Danbury Sports Dome was cooperative with the U.S. Attorney’s Office and is committed to addressing the issues raised by the ADA investigation without litigation.
“The U.S. Attorney’s Office enforces the Americans with Disabilities Act, which ensures that individuals are able to access and enjoy places of public accommodation in Connecticut, including the state’s gymnasiums and other places of exercise and recreation,” stated U.S. Attorney Durham. “Throughout our investigation, the management of Danbury Sports Dome showed its commitment to complying with the ADA and making all changes necessary to accommodate children with disabilities at its facility.”
Any member of the public who wishes to file a complaint alleging that any place of public accommodation or public entity in Connecticut is not accessible to persons with disabilities may contact the U.S. Attorney’s Office at 203-821-3700.
Additional information about the ADA can be found at www.ada.gov, or by calling the Justice Department’s toll-free information line at (800) 514-0301 and (800) 514-0383 (TTY). More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt.
This matter was handled by Assistant U.S. Attorney Jessica H. Soufer of the District of Connecticut in coordination with the Disability Rights Section of the U.S. Department of Justice Civil Rights Division.
U.S. Attorney's Office and FBI to Host Elder Fraud Prevention Telephone Town Hall to Promote Elder Justice InitiativeRead the Press Release
LAS VEGAS, Nev. – The United States Attorney’s Office for the District of Nevada and the FBI Las Vegas Division are promoting the Department of Justice’s (DOJ) Elder Justice Initiative with an interactive telephone town hall on June 10, announced U.S. Attorney Nicholas A. Trutanich and Special Agent in Charge Aaron C. Rouse for the FBI Las Vegas Division.
One of the best ways to protect yourself or a loved one from financial fraud is to remain informed. The U.S. Attorney’s Office, the FBI, and AARP Nevada have partnered to raise awareness and educate Nevada’s seniors about the latest financial scams. The free telephone town hall will be live on Monday, June 10, from 9:30 a.m. to 10:30 a.m. PDT.
The Internet Crime Complaint Center (IC3) was established to provide the public with a reliable and convenient reporting mechanism to submit information to the FBI. The IC3 aggregates and forwards suspected criminal internet activity to the appropriate local, state, federal, and international law enforcement agencies for possible investigation. In 2018, the IC3 received a total of 351,936 complaints with losses in excess of $2.7 billion.
To join the free telephone town hall, register at https://vekeo.com/event/aarpnevada-45728/.
The DOJ Elder Justice Initiative aims to combat elder financial exploitation by expanding efforts to investigate and prosecute financial scams that target seniors; educating older adults on how to identify scams and avoid getting ripped off by scammers; and promoting greater coordination with law enforcement partners.
Elder fraud complaints may be filed with the Federal Trade Commission at 1-877-FTC-HELP or online at www.ftccomplaintassistant.gov or the IC3 at www.ic3.gov.
The DOJ provides a variety of resources relating to elder fraud victimization through its Office of Victims of Crime at www.ovc.gov. Additional elder justice resources, training, and outreach materials can be found at the Elder Justice Website at www.elderjustice.gov.
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U.S. Attorney D. Michael Dunavant Completes Class VI of the Leadership Tennessee Signature ProgramRead the Press Release
Memphis, TN - On June 3, 2019, U.S. Attorney D. Michael Dunavant was among 45 Class VI members to complete and graduate from the Leadership Tennessee Signature Program. Starting in August, 2018, Class VI members participated in a ten month, five session course of study that allowed them to visit each region of the state, engage in analytical conversations of importance to critical state issues, learn from state and national experts on those issues, and experience the cultural diversity of the region. The study of those issues by Leadership Tennessee members resulted in increased statewide networking, collaborative conversations, and concrete plans to continue that dialogue and actions beyond the yearlong commitment.
The 45 Class VI members represented each geographic region of the state, including the communities of Memphis, Martin, Jackson, Nashville, Clarksville, Murfreesboro, Knoxville, Kingsport, Johnson City and Chattanooga. Professional sectors represented included healthcare, education, economic development, government, tourism and agriculture.
Finishing its sixth year, Leadership Tennessee selects a new class of leaders annually to visit different regions and communities of Tennessee, learning best practices and analyzing important issues faced by Tennesseans. To date, Leadership Tennessee has built a network of over 200 leaders across the state.
As part of its mission to foster dialogue and increase connection on issues of statewide importance, Leadership Tennessee hosted Sam Quinones, author of "Dreamland: The True Tale of America’s Opiate Epidemic" in Kingsport and Knoxville in November, 2018, and also co-hosted the West Tennessee Opioid Summit in Memphis in April, 2019, to discuss the opioid crisis and create learning
and community collaboration to combat the epidemic and support those at risk of or recovering from addiction. In addition, throughout the ten month sessions, Class VI members focused on the issues of education and workforce development, access to healthcare, urban blight and poverty, rural economic development, public safety, and civic engagement.
U.S. Attorney D. Michael Dunavant said, "Being selected to participate in the Leadership Tennessee Signature Program was a high honor for me, and I was thankful to join so many other talented and dedicated leaders in productive dialogue and learning in order to tackle the urgent challenges in our state. I am confident that the connections made and insights gained will help me better represent and protect the citizens of the Western District of Tennessee."
Leadership Tennessee, an initiative of the College of Leadership & Public Service at Lipscomb University, fosters collaborative, non-partisan dialogue on issues of state importance, connecting a network of diverse leaders and engaged citizens from rural and urban communities across Tennessee.
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Two USP Canaan Inmates Charged with Assault and Possession of ContrabandRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Joshua Truesdale, age 37, and James Brooks, age 34, inmate as United States Penitentiary Canaan (USP Canaan) in Waymart, Pennsylvania, were indicted by a federal grand jury on June 4, 2019. for conspiracy and assault with a dangerous weapon.
According to United States Attorney David J. Freed, the indictment alleges that on August 13, 2018, Truesdale and Brooks conspired and attacked another inmate with a sharpened piece of metal and plastic, commonly referred to as a “shank.”
The investigation was conducted by agents of the Federal Bureau of Investigation and officers at USP Canaan. Assistant United States Attorney Alisan V. Martin is prosecuting the case.
Indictments are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law for both conspiracy and assault with a deadly weapon is 10 years of imprisonment, 3 years of supervised release, and a fine of $250,000. The maximum penalty for possession of contraband is 5 years of imprisonment, 3 years of supervised release, and a fine of $250,000. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Two Rapid City Men Charged in RobberyRead the Press Release
United States Attorney Ron Parsons announced that two Rapid City, South Dakota, men were charged in federal district court with Interference with Commerce by Robbery, Use and Brandishing of a Firearm During the Commission of a Crime of Violence, and Conspiracy.
Corbin Conroy, age 40, and Wesley Dillon, age 18, were indicted on April 16, 2019. Conroy and Dillon appeared before U.S. Magistrate Judge Daneta Wollmann and pleaded not guilty to the charges. The maximum penalty upon conviction is life in federal prison and/or a $250,000 fine, 5 years of supervised release, and a $100 assessment to the Federal Crime Victims Fund. Restitution may also be ordered.
The charges relate to Conroy and Dillon robbing a Rapid City casino in March 2019, and brandishing a pistol at a casino employee.
The charges are merely an accusation and Conroy and Dillon are presumed innocent until and unless proven guilty.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of its 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 local communities to develop effective, locally-based strategies to reduce violent crime.
The investigation is being conducted by the Bureau of Alcohol, Tobacco, Firearms, and Explosives, and the Rapid City Police Department. Assistant U.S. Attorney Ben Patterson is prosecuting the case.
Conroy and Dillon were detained pending trial. A trial date has not been set.
Two North Pole Men Sentenced for Orchestrating Identity Theft ConspiracyRead the Press Release
Anchorage, Alaska – U.S. Attorney Bryan Schroder announced that two North Pole men were sentenced to federal prison for orchestrating a sophisticated fraud, identity theft, and mail theft conspiracy involving numerous victims and thousands of dollars in fraudulent purchases in Fairbanks and North Pole, Alaska.
Andrew Mac Saunders, 43, and Ian David Bowman, 30, were sentenced in Fairbanks today by Senior U.S. District Judge Ralph R. Beistline to serve 40 months and 52 months in federal prison, respectively. In March 2019, Saunders and Bowman both pleaded guilty to federal identity theft charges. Saunders and Bowman also agreed to pay $29,418 in restitution to the victims in this case, plus other yearly payments to compensate victims for costs associated with identity theft protection. The Court set a final restitution hearing for Aug. 16, 2019.
According to court documents, on Jan. 19, 2018, the Alaska State Troopers (AST) responded to a report that Saunders and Bowman were perpetrating a scheme to manufacture and use counterfeit identification documents and counterfeit checks. A search warrant was executed on their shared residence in North Pole, where AST seized computers, hard drives, and printers that revealed that extent of the criminal scheme. The seized computers contained 51 unique counterfeit identification documents, of which ten displayed Saunders’ photograph, 21 displayed Bowman’s photograph, and 20 others displayed the photographs of their co-conspirators, and all of which included the names and addresses of victims. Numerous stolen identity documents were also seized that contained victims’ personal information.
The investigation revealed that Saunders and Bowman would steal mail from the mailboxes of victims who reside in Fairbanks and North Pole. They would then use that mail to create false driver’s licenses using specialized computer programs and printing equipment procured by Bowman, inserting his own and his co-conspirators’ photos along with the true name, address, and driver’s license number of victims. Saunders and Bowman would then create counterfeit checks printed in the victims’ names, open lines of credit at various retailers, and open accounts at stores like Verizon and AT&T to purchase high-value merchandise, often presenting the false driver’s licenses to complete the transactions. Saunders, Bowman and their co-conspirators sold this merchandise for cash, which they then used to purchase illegal narcotics.
At the sentencing hearings, Judge Beistline noted that this crime “involved greed,” was “sophisticated” and “premeditated,” and “required thought, effort, and work.” Judge Beistline also noted the sharp rise in identity theft crimes in recent years, as well as the importance of general deterrence in fashioning the sentences that Saunders and Bowman received.
The Federal Bureau of Investigation (FBI), the Alaska State Troopers (AST), the Fairbanks Police Department (FPD), the U.S. Bureau of Land Management (BLM) Office of Law Enforcement and Security, and the Alaska State Park Rangers conducted the investigation leading to the successful prosecution of this case. This case was prosecuted by Assistant U.S. Attorney Ryan D. Tansey.
Two Men Plead Guilty to Firearms ConspiracyRead the Press Release
ALEXANDRIA, Va. – Two Washington, D.C. area men pleaded guilty this week to their roles in a conspiracy to transport with the intent to engage in unlawful interstate dealing in firearms.
“The illegal purchase, transportation and resale of firearms presents risks of violence and a serious danger to our communities and the law enforcement officers who keep us safe,” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “I would like to thank our local and federal law enforcement partners for their work in keeping illegal firearms off the streets and out of our communities.”
According to court documents, Daryl Antonio Pearce, 21, and his half-brother, Darius Antonio Giles, 22, conspired together to travel from Maryland and Washington, D.C.—where they resided—to Virginia to acquire firearms with the intent to engage in the business of dealing firearms. During the course of this conspiracy, Pearce and Giles purchased well over 33 firearms within the Eastern District of Virginia and elsewhere. After they purchased these firearms, they transported them from Virginia to Maryland and Washington, D.C., where Pearce and Giles resold the firearms to various individuals for profit. Several of the firearms have been recovered by law enforcement in Washington, D.C. and Maryland, including from a convicted felon. Giles was arrested in February following a controlled firearm buy with undercover ATF agents.
Pearce and Giles pleaded guilty to conspiracy to transport firearms interstate and to act with the intent to engage in interstate dealing in firearms. They both face a maximum penalty of five years in prison when sentenced on September 20. In addition, Giles pleaded guilty to being a felon in possession of a firearm, and faces an additional maximum penalty of 10 years in prison at sentencing. 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.
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, and Ashan M. Benedict, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, made the announcement after U.S. District Judge Liam O’Grady accepted the plea. Special Assistant U.S. Attorney Joel H. Feil and Assistant U.S. Attorney Nicholas U. Murphy II are 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-139.
Two Defendants Plead Guilty to Cattle RustlingRead the Press Release
OKLAHOMA CITY – ANTHONY WHITTLEY, 28, of Parsons, Kansas, and JASMINE BOONE, a/k/a Jasmine Thomas, 28, of Wister, Oklahoma, have pleaded guilty to cattle rustling, announced United States Attorney Timothy J. Downing.
On March 19, 2019, a federal grand jury returned a two-count indictment that charged Whittley and Boone with transporting seventeen stolen cattle in interstate commerce on December 11, 2018, by moving them from Cherokee County, Kansas, to the Oklahoma National Stockyards Company in Oklahoma City.
Agents arrested the pair when the sale was complete. They have been in the custody of the U.S. Marshals Service since early April.
On June 5, both Whittley and Boone pleaded guilty to transporting cattle in interstate commerce. They acknowledged in a written plea agreement that they committed similar thefts in Crawford County, Kansas, and LeFlore County, Oklahoma, in the second half of 2018. They admitted they sold these cattle in Tulsa and Springfield, Missouri, respectively. They also admitted they sold cattle stolen in Cherokee County, Kansas, in Siloam Springs, Arkansas.
Whittley has agreed to pay more than $43,000 in restitution, including more than $15,000 to the Farm Service Agency, part of the U.S. Department of Agriculture, for the sale of mortgaged cattle without the lender’s authorization. Boone has agreed to pay more than $28,000 in restitution.
Each defendant could be sentenced to a maximum of five years in prison, in addition to three years of supervised release, and fined up to $250,000. Sentencing will take place in approximately 90 days.
This case is the result of an investigation by the Major Theft Task Force of the FBI Oklahoma City Division; the Oklahoma Department of Agriculture; the Missouri Highway Patrol; the Kansas Attorney General’s Office; the County Attorney’s Offices and Sheriff’s Offices in Cherokee County and Crawford County, Kansas; and the District Attorney’s Office of LeFlore County, Oklahoma. Assistant U.S. Attorney Edward J. Kumiega is prosecuting the case.
Reference is made to public filings for further information.
Tulare County Man Charged with Unlawfully Possessing a Machinegun and CocaineRead the Press Release
FRESNO, Calif. — A federal grand jury returned a three-count indictment on Thursday against Francisco Fernandez, 26, of Earlimart, charging him with possessing cocaine for distribution, unlawfully possessing a machinegun, and possession of an unregistered firearm, U.S. Attorney McGregor W. Scott announced.
According to court documents, on April 19, 2019, agents searched Fernandez’s residence and storage unit and found cocaine, several assault rifles, a Glock pistol that was converted into a machinegun, and several auto sears. An auto sear is a part that is used to convert a semi‑automatic pistol into a fully automatic machinegun. Fernandez is prohibited from possessing firearms because he is an unlawful user of cocaine.
This case is the product of an investigation by Bureau of Alcohol, Tobacco, Firearms and Explosives and Homeland Security Investigations. Assistant U.S. Attorney Thomas Newman is prosecuting the case.
If convicted, Fernandez faces a maximum statutory penalty of 20 years in prison and a $1 million fine for possessing with the intent to distribute cocaine and a maximum statutory penalty of 10 years in prison and a $250,000 fine for the firearms charges. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case was brought as part of Project Safe Neighborhoods (PSN), the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
Three Members of Virginia Family Arrested and Charged with Conspiring to Force Victim to Labor in Their Home for YearsRead the Press Release
An indictment was unsealed today in federal court following the arrests of Zahida Aman, 77, Mohammed Naumann Chaudhri, 51, and Mohammed Rehan Chaudhri, 45, all of Midlothian, Virginia. The indictment charges the defendants with conspiracy, forced labor, and document servitude. Assistant Attorney General Eric Dreiband of the Justice Department’s Civil Rights Division, U.S. Attorney G. Zachary Terwilliger Eastern District of Virginia and David W. Archey, Special Agent in Charge of the FBI’s Richmond Field Office made the announcement.
According to the allegations set forth in the indictment, between March 2002 and August 2014, the defendants conspired to force the victim, who had been married to Aman’s son, to provide labor and services at their Midlothian home, to include cleaning the house, painting the house, and mowing the lawn. The indictment further alleges that the defendants subjected the victim to physical, psychological, and verbal abuse, withheld her food, restricted her communications with family and neighbors, confiscated her immigration and identification documents, limited her access to her own children, and threatened to separate her from her children, among other coercive means.
An indictment is merely an accusation, and the defendants are presumed innocent unless proven guilty. If convicted of forced labor, the defendants face sentences of up to 20 years in prison, as well as mandatory restitution.
The case is being investigated by the FBI’s Richmond Division. It is being prosecuted by Assistant United States Attorney Heather Mansfield for the Eastern District of Virginia and Trial Attorneys Vasantha Rao and Maryam Zhuravitsky for the Civil Rights Division’s Human Trafficking Prosecution Unit.
Three Child Predators Sentenced in Federal Court This WeekRead the Press Release
PHILADELPHIA – U.S. Attorney William M. McSwain announced that three men from across the Eastern District of Pennsylvania have been sentenced to prison this week by federal judges for child exploitation offenses in separate cases. Arthur Schlegel, 48 of Roseto, PA was sentenced to fifteen years imprisonment, twenty years supervised release and $10,000 restitution by Judge Joseph Leeson on June 4, 2019; Kenneth Laporte, 43, of Philadelphia, PA was sentenced to fifteen years imprisonment and lifetime supervised release by Judge Harvey Bartle III on June 4, 2019; and Michael Seibert, 32, of Allentown, PA was sentenced to thirty years imprisonment and lifetime supervised release by Judge Joseph Leeson on June 6, 2019.
In the Schlegel case, the defendant pleaded guilty to multiple counts of possession and distribution of child pornography. For years, Schlegel amassed a collection of over a thousand images and videos depicting the sexual abuse of children. He also shared child sexual assault images and videos online.
In the Laporte case, the defendant pleaded guilty to multiple counts of receipt and possession of child pornography for events that occurred within months of the defendant being released from federal prison after serving a sentence for similar charges.
In the Seibert case, the defendant pleaded guilty to multiple counts of manufacturing and possession of child pornography. Posing as a teenage boy, Seibert visited internet chat rooms to communicate with multiple minor girls between the ages of 10 and 14, and persuaded them to take pornographic images of themselves and send the images to him. The defendant also downloaded hundreds of digital images and dozens of videos of child pornography from internet websites.
“The nature of these crimes is horrifying and the negative impact on the victims can never be fully understood or appreciated, which is why my Office is committed to working with our law enforcement partners to identify, investigate and prosecute these dangerous predators,” said U.S. Attorney William M. McSwain. “Child exploitation is a pervasive problem — made more so by the accessibility of the internet — that demands an aggressive response. We thank the Judges in these cases for delivering justice to these defendants through lengthy sentences.”
“Laporte took advantage of the justice system by sexually exploiting children just months after being released from federal prison for similar offenses,” said Michael Harpster, Special Agent in Charge of the Philadelphia Division of the FBI. “Not only did he blatantly disregard the court, but he continued exploiting innocent children. This lengthy sentence makes certain that Laporte will not be afforded any further opportunity to commit these heinous acts. Society is a safer place with Laporte behind bars.”
“Child sexual exploitation is one of the most despicable crimes committed,” said Marlon V. Miller, special agent in charge of HSI Philadelphia. “These substantial prison sentences serve as a reminder of the strong commitment by Homeland Security Investigations to collaborate with our law enforcement and community partners to bring online child predators to justice.”
These cases were brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
The Schlegel case was investigated by the Department of Homeland Security Investigations and is being prosecuted by Assistant United States Attorney Sherri Stephan. The Laporte case was investigated by the Federal Bureau of Investigation and the United States Probation Office, and is being prosecuted by Assistant United States Attorney Everett Witherell. The Seibert case was investigated by Department of Homeland Security Investigations and the Delaware County District Attorney’s Office, and is being prosecuted by Assistant United States Attorney Frank Labor.
Tampa Man Arrested and Charged with Trafficking Two Teen GirlsRead the Press Release
Tampa, Florida – Luis Berrios-Trinidad (29, Tampa) has been arrested on a criminal complaint charging him with the human trafficking of minors. If convicted, Berrios-Trinidad faces a mandatory minimum sentence of 10 years, up to life, in federal prison.
According to court documents beginning on May 23, 2019, Homeland Security Investigations agents engaged in undercover communications with Berrios-Trinidad regarding his representations that he was offering underage girls for sex acts in exchange for money. From May 23 to June 6, 2019, agents continued to communicate with Berrios-Trinidad and ultimately set up a meeting with him. On June 6, 2019, Berrios-Trinidad brought two minor girls to a Tampa-area hotel for the express purpose of engaging in commercial sex acts with the undercover agents, who were posing as adult male customers. Shortly after his arrival at the hotel, Berrios-Trinidad was arrested and the two girls were taken into protective custody.
A criminal complaint is merely an allegation that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case is being investigated by Homeland Security Investigations. It will be prosecuted by Assistant United States Attorney Candace Rich.
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 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 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.projectsafechildhood.gov.
Strafford Woman Sentenced to 12 Years for Meth ConspiracyRead the Press Release
SPRINGFIELD, Mo. – A Strafford, Mo., woman has been sentenced in federal court for her role in a conspiracy to distribute methamphetamine in the Springfield, Mo., area.
Cynthia A. House, 50, was sentenced by U.S. District Judge M. Douglas Harpool on Thursday, June 6, to 12 years in federal prison without parole.
On Dec. 6, 2018, House pleaded guilty to conspiracy to distribute methamphetamine and to two counts of possessing methamphetamine with the intent to distribute. House admitted that she participated in a conspiracy from November 2015 to February 7, 2017, in which multiple pounds of methamphetamine were purchased from a supplier in Kansas City, Mo., for distribution in the Springfield area.
According to court documents, House contacted her source in Kansas City by telephone to order one or two pounds of methamphetamine each week. House paid approximately $9,000 per pound for the methamphetamine, which was delivered via courier within 24 hours.
From May 2016 to February 2017, according to court documents, significant quantities of methamphetamine were discovered by law enforcement officers in a series of arrests and searches. In total, officers seized approximately 977.89 grams of methamphetamine from House during that time. Additionally, a total of over $21,000 was seized from House (who was unemployed) during the investigation.
This case was prosecuted by Assistant U.S. Attorney Byron H. Black. It was investigated by the Drug Enforcement Administration, the Springfield, Mo., Police Department, and the Strafford, Mo., Police Department.
St. Croix Man Pleads Guilty to Possessing Twenty Pounds of Marijuana at Henry E. Rohlsen AirportRead the Press Release
St. Croix, USVI – Dequan Forde, 21, of St. Croix, pled guilty on June 6, 2019, in District Court to one federal count of Possession of Marijuana with Intent to Distribute, United States Attorney Gretchen C.F. Shappert announced.
This offense carries a possible sentence of incarceration of up to 5 years, a maximum fine of up to $250,000 dollars, and a term of supervised release of at least 2 years. Sentencing is set for October 9, 2019.
According to court documents, on January 31, 2018, the defendant traveled on American Airlines flight #2317 from Miami, Florida, to St. Croix. Upon his landing at the Henry E. Rohlsen Airport on St. Croix, an x-ray examination of Forde’s luggage displayed unusual packaging. A physical examination of the luggage revealed a laundry bag that contained two vacuumed-sealed bags containing suspected marijuana. The luggage was subsequently placed on the baggage carousel where the defendant retrieved it. The total gross weight of the marijuana was approximately 9.40 kilograms, or approximately 20 pounds.
The case was investigated by Customs and Border Protection and Homeland Security Investigations. The marijuana was analyzed by the DEA Southeast Laboratory in Miami. Assistant U.S. Attorney Daniel H. Huston prosecuted the case.
St. Cloud Woman Sentenced for Stealing Social Security and Veterans BenefitsRead the Press Release
Orlando, Florida – U.S. District Judge Carlos E. Mendoza today sentenced Lisa Browne (47, St. Cloud) to five months in federal prison, followed by three years of supervised release, for theft of government property. As part of her sentence, the court also ordered Browne to pay restitution in the amount of $68,319 to the Social Security Administration (SSA) and $66,693.48 to the Department of Veterans’ Affairs (VA).
Browne had pleaded guilty on March 21, 2019.
According to court documents, Browne’s grandfather, C.Z., was receiving Social Security Retirement Insurance Benefits and VA disability benefits. C.Z. passed away on or about February 2, 2014, and C.Z.’s death was never reported to either the SSA or the VA. Consequently, the SSA and VA continued to make benefit payments to C.Z. Browne accessed the funds and used them for personal expenses from in or around February 2014 through in or around March 2018. In total, Browne knowingly and willfully stole or converted approximately $68,319 in SSA benefits and $66,693.48 in VA benefits to which she was not entitled.
This case was investigated by the Social Security Administration, Office of the Inspector General and the Department of Veterans’ Affairs, Office of the Inspector General. It was prosecuted by Special Assistant United States Attorney Suzanne Huyler.
Sisseton Man Sentenced for Abusive Sexual ContactRead the Press Release
United States Attorney Ron Parsons announced that a Sisseton, South Dakota, man convicted of abusive sexual contact was sentenced on June 3, 2019, by U.S. District Jude Charles B. Kornmann.
Joel Michael Max, age 30, was sentenced to 120 months in federal prison, to be followed by 10 years of supervised release. He was ordered to pay $100 to the Federal Crime Victims Fund.
According to court documents, between March 23, 2018, and June 2, 2018, Max did knowingly engage in, and attempt to engage in, sexual contact with a child. Max acted with an intent to abuse, humiliate, harass, and degrade the child, and to arouse and gratify his sexual desires.
The investigation was conducted by the Federal Bureau of Investigation and the Sisseton-Wahpeton Sioux Tribe’s Law Enforcement. Assistant U.S. Attorney Jeremy R. Jehangiri prosecuted the case.
Max was remanded to the custody of the U.S. Marshals Service.
Rapid City Man Sentenced to 20 Years for Conspiring to Distribute MethamphetamineRead the Press Release
United States Attorney Ron Parsons announced that a Rapid City, South Dakota, man convicted of Conspiracy to Distribute a Controlled Substance has been sentenced by Chief Judge Jeffrey L. Viken.
Michael Carey, age 57, was sentenced to 20 years in federal prison, followed by 5 years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
“This is an appropriate prison sentence for a defendant who has been a major source of meth sold in western South Dakota,” said U.S. Attorney Parsons. “The public can be assured that federal, state, local, and tribal law enforcement agencies are working together to do everything possible to dismantle the drug trafficking organizations bringing this poison into our communities. And anyone still trafficking illegal drugs in this state should understand that they are next on the list.”
Carey was indicted by a federal grand jury on November 20, 2018, for Conspiracy to Distribute a Controlled Substance and Possession with Intent to Distribute a Controlled Substance. He pled guilty to the conspiracy charge on February 15, 2019.
On multiple occasions, Carey traveled to California to obtain methamphetamine from a California supplier. Upon Carey’s return, Carey would coordinate with others to distribute the methamphetamine in the Black Hills area. After months of investigation, a traffic stop was conducted while Carey was returning to South Dakota, and approximately 10 pounds of methamphetamine were found in his possession. Federal drug charges against an additional co-conspirator with Carey are pending.
This case was investigated by the Drug Enforcement Agency, the South Dakota Highway Patrol, and the local Unified Narcotics Enforcement Team. Assistant U.S. Attorney Gina Nelson prosecuted the case.
Carey was immediately turned over to the custody of the U.S. Marshals Service.
Rapid City Man Indicted for Failure to Register as a Sex OffenderRead the Press Release
United States Attorney Ron Parsons announced that a Rapid City, South Dakota, man has been indicted by a federal grand jury for Failure to Register as a Sex Offender.
Eugene Leon Featherman, age 30, was indicted on November 14, 2018. He appeared before U.S. Magistrate Judge Mark A. Moreno on May 31, 2019, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in federal prison and/or a $250,000 fine, 5 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
Featherman was convicted of Abusive Sexual Contact in January 2012. As a result of this conviction, he is required to register as a sex offender for a period of 25 years. It is alleged that between August 25, 2018, and November 14, 2018, Featherman, a person required to register under the Sex Offender Registration and Notification Act, and a sex offender by reason of conviction under Federal Law, failed to properly register as a sex offender.
The charge is merely an accusation and Featherman is presumed innocent until and unless proven guilty.
The investigation is being conducted by the U.S. Marshals Service. Assistant U.S. Attorney Michael J. Elmore is prosecuting the case.
Featherman was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
Rapid City Man Charged with Wire Fraud and Theft of Government PropertyRead the Press Release
United States Attorney Ron Parsons announced that a Rapid City, South Dakota, man was charged in federal district court with 18 counts of Wire Fraud and one count of Theft of Government Property.
Robert Rodney Bland, age 51, was indicted on May 21, 2019. He appeared before U.S. Magistrate Judge Daneta Wollmann on June 6, 2019, and pleaded not guilty to the charges. The maximum penalty upon conviction is 20 years in federal prison and/or a $250,000 fine, 3 years of supervised release, and a $100 assessment to the Federal Crime Victims Fund. Restitution may also be ordered.
The charges relate to Bland fraudulently billing for windshield rock chip repairs that were never done on General Services Administration vehicles. The charges are merely an accusation and Bland is presumed innocent until and unless proven guilty.
The investigation is being conducted by the General Services Administration-Office of Inspector General, the Department of Health and Human Services-Office of the Inspector General, and the Department of Defense-Office of the Inspector General. Assistant U.S. Attorney Benjamin Patterson is prosecuting the case.
Bland was released pending trial. A trial date has not been set.
Raleigh Investment Advisor Convicted on Twenty Counts of Investment FraudRead the Press Release
RALEIGH – United States Attorney Robert J. Higdon, Jr. announced that a federal jury has convicted STEPHEN CONDON PETERS, 45, of Raleigh, North Carolina, on multiple counts of investment fraud. PETERS was convicted of:
- one count – Investment Advisor Fraud;
- one count – Fraud in the Sale of Unregistered Securities;
- nine counts – Wire Fraud;
- four counts – Engaging in Monetary Transactions in Criminally Derived Property;
- one count – Corruptly Endeavoring to Influence a Federal Agency;
- one count – Aggravated Identity Theft;
- one count – Conspiracy to Make and Use False Documents and to Falsify and Conceal Records;
- one count – Making and Using False Documents; and,
- one count – Falsifying and Concealing Documents During an SEC Examination.
The jury also found that PETERS was to forfeit multiple assets for the benefit of victims, including: his primary residence (known as “Whispering Hope Farm”), his luxury vacation home in Costa Rica (known as “House of the Beloved Princess”), the financial accounts tied to the fraud he committed, and numerous watches and firearms.
United States Attorney Higdon commented, “When people put their trust in a financial advisor, they expect honesty and professionalism. Instead, Mr. Peters violated that trust and breached his fiduciary duties for his own personal gain. This simply will not be tolerated. The United States Attorney’s Office will continue to partner with local, state, and federal law enforcement to vigorously enforce federal law in order to protect the citizens of Eastern North Carolina.”
"Stephen Peters abused his position and defrauded clients who trusted him with their life savings. This is a case about greed and abuse of trust. The FBI will continue to work with our partners to ensure this kind of malicious behavior is investigated and prosecuted. Mr. Peters will now face serious consequences for his fraudulent actions,” said John Strong, Special Agent in Charge of the FBI in North Carolina.
The original Indictment, issued in December of 2017, charged PETERS with one count of Investment Advisor Fraud; one count of Fraud in the Sale of Unregistered Securities; nine counts of Wire Fraud; four counts of Engaging in Monetary Transactions in Criminally Derived Property; and one count of Corruptly Endeavoring to Influence a Federal Agency. Read more
A Superseding Indictment was subsequently filed which included four additional charges: one count of Aggravated Identity Theft; one count of Conspiracy to Make and Use False Documents and to Falsify and Conceal Records; one count of Making and Using False Statements and Documents; and, one count of Falsifying and Concealing Documents During an SEC Examination. The Superseding Indictment also included additional assets to be forfeited upon conviction. Read more
The jury heard evidence that, as stated in the Superseding Indictment, beginning in 2009, and continuing into 2017, PETERS orchestrated the sale of VisionQuest Capital LLC promissory notes (the “Capital LLC Notes”), primarily to VisionQuest Wealth Management LLC clients. In exchange for an investment of funds, the Capital LLC Notes purported to promise investors an 8% or 9% annual return on principal over a five year term. In connection with the sale of the Capital LLC Notes, PETERS represented and caused to be represented to investors that the Capital LLC Notes were a low risk investment, and that the note proceeds would be invested into revenue generating or income-producing businesses. In fact, PETERS stole large portions of the investor proceeds and carried out a "Ponzi" scheme on investors.
PETERS, both directly and through his staff at VisionQuest Wealth Management, LLC, forged, fabricated, and concealed documents and records in an effort to thwart an examination by the United States Securities and Exchange Commission (SEC) in late 2016. Additionally, PETERS forged and backdated a letter to his former compliance officer purporting to place the burden of disclosing PETERS’ conflicts of interest upon the compliance officer. PETERS further directed the fabrication of numerous other records given to the SEC examiners, including client balance sheets, wealth management contracts, outside business activity disclosures, and internal compliance memoranda.
At sentencing, PETERS faces the following penalties: Investment Advisor Fraud, not more than 5 years imprisonment; Fraud in the Sale of Unregistered Securities, five years imprisonment; Wire Fraud, twenty years imprisonment per count; Engaging in Monetary Transactions in Criminally Derived Property, ten years imprisonment per count; Corruptly Endeavoring to Influence a Federal Agency, five years imprisonment; Aggravated Identity Theft, not less or more than 2 years imprisonment, consecutive to any other sentence imposed; Conspiracy to Make and Use False Documents and to Falsify and Conceal Records, not more than 5 years imprisonment; Making False Statements and Documents, not more than 5 years imprisonment; and, Falsifying and Concealing Documents During an SEC Examination, not more than 20 years imprisonment. Additionally, PETERS faces up to $1 Million in additional fines, as well as further forfeiture of property.
The investigation of this case was conducted by the Federal Bureau of Investigation and the Internal Revenue Service Criminal Investigation. Assistant United States Attorney William M. Gilmore represents the United States.
Queens Man Who Wanted to Attack Times Square Arrested for Purchasing Firearms with Obliterated Serial NumbersRead the Press Release
A criminal complaint was filed today in federal court in Brooklyn charging Ashiqul Alam with knowingly receiving two firearms with obliterated serial numbers in Brooklyn, New York. Alam was arrested yesterday and is scheduled to be presented this afternoon before United States Magistrate Judge Cheryl L. Pollak.
Richard P. Donoghue, United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and James P. O’Neill, Commissioner, New York City Police Department (NYPD), announced the arrest.
“As alleged, Ashiqul Alam bought illegal weapons as part of his plan to kill law enforcement officers and civilians in a terrorist attack on Times Square,” stated United States Attorney Donoghue. “What he did not know was that he was buying weapons from government agents, who were monitoring his plans and intervening to prevent those plans from escalating into deadly violence. This Office, together with our law enforcement partners, will continue to exercise extreme vigilance to prevent terrorists from attacking our city and our country.”
“There is more to this case than just talk and the desire to carry out a terrorist attack. Individuals who believe in the distorted and deadly propaganda of terrorist organizations and work toward acting on those deadly impulses are incredibly dangerous and unpredictable,” said FBI Assistant Director-in-Charge Sweeney. “Mr. Alam allegedly then took the steps to follow through on his deadly impulse, purchasing weapons to kill New Yorkers, target an elected official and attack police officers. The FBI New York Joint Terrorism Task Force and the NYPD Intelligence Bureau will simply not allow individuals to execute their plots, and our team will use every legal tool available to us to protect our community and remain ahead of the threat individuals like Alam pose to our communities.”
“Mr. Alam discussed guns, suicide vests, hand grenades, and surveilled crowded New York targets such as Times Square”, said Police Commissioner O’Neill. “Our job is to prevent these terrorist attacks whenever we can before they are carried out. This case is another example of the tightly-knit teamwork of the JTTF and the NYPD’s Intelligence Bureau. Mr. Alam is charged with illegally purchasing untraceable firearms from undercover officers. That was a clear indicator of his intent to move his plot forward.”
As alleged in the complaint, between August 2018 and the present, Alam repeatedly expressed a desire to purchase firearms and explosives for use in a terrorist attack. Alam identified two targets, either Times Square or Washington, D.C., in order to kill a senior government official. In January 2019, Alam conducted several “recon” trips to Times Square, using his cellular telephone to make a video recording of the area as he searched for potential targets. Alam considered multiple ways to conduct such an attack, including by using a “suicide vest” and by obtaining AR-15 assault rifles to kill law enforcement officers.
Alam conducted research about firearms on the internet and discussed purchasing firearms with an undercover law enforcement officer (“UC-1”). In March 2019, Alam told UC-1 that he would be interested in buying a Glock 9mm pistol. UC-1 introduced Alam to an “associate,” who offered to help Alam procure two illegal Glock G19 pistols. In April 2019, Alam underwent Lasik eye surgery, a procedure whose value he explained: “Let’s say we are in an attack, right, say that my glasses fall off. What if I accidentally shoot you? You know what I mean. Imagine what the news channel would call me the ‘Looney Tunes Terrorist’ or the ‘Blind Terrorist.’”
In May 2019, Alam was told that the firearms he wanted to buy would have obliterated serial numbers, and he replied “Oh, that’s good man.” Alam then had repeated conversations and meetings with individuals he believed were going to sell him firearms, including one meeting in which he was shown hand grenades for purchase. Alam subsequently discussed buying grenades because a grenade could “take out at least eight people.” Alam also asked to order ammunition as well as weapons because, he said, “What is the point of getting a gun without ammo?”
On June 6, 2019, Alam met the individual he believed was going to sell him firearms and was shown two Glock 19 semiautomatic pistols with obliterated serial numbers. The defendant provided $400 towards the purchase of the two pistols and asked whether he could also buy a silencer. The defendant was arrested shortly thereafter.
The charge in the complaint is an allegation, and the defendant is presumed innocent unless and until proven guilty.
The government’s case is being handled by the Office’s National Security and Cybercrime Section. Assistant United States Attorneys David K. Kessler, Michael Keilty and Jonathan Algor are in charge of the prosecution, with assistance from Trial Attorney Jacqueline L. Barkett of the Department of Justice’s Counterterrorism Section.
The Defendant:
Ashiqul Alam
Age: 22
Queens, New YorkE.D.N.Y. Docket No. 19-M-0531
Pukwana Man Charged with AssaultRead the Press Release
United States Attorney Ron Parsons announced that a Pukwana, South Dakota, man has been indicted by a federal grand jury for Assault with a Dangerous Weapon and Assault Resulting in Serious Bodily Injury.
Sidney DuBray, age 24, was indicted on May 14, 2019. He appeared before U.S. Magistrate Judge Mark A. Moreno on May 31, 2019, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 10 years in federal prison and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on December 20, 2018, DuBray assaulted an individual with a knife causing serious bodily injury to the victim.
The charges are merely accusations and DuBray is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Federal Bureau of Investigation. Assistant U.S. Attorney Troy R. Morley is prosecuting the case.
DuBray was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.