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1 May 2019
Monroe felon sentenced to 71 months for possessing two handguns, ammunition and bullet drumRead the Press Release
MONROE, La. – United States Attorney David C. Joseph announced today that Kendrick Darnell Williams, 27, of Monroe, was sentenced to five years and 11 months in prison by U.S. District Judge Terry Doughty for possessing two handguns, multiple rounds of ammunition and a large capacity drum magazine. He was also sentenced to three years of supervised release.
Monroe police officers stopped a car on October 17, 2017 for a traffic violation, and Kendrick Williams jumped out of the passenger door and ran. Officers caught Williams and brought him back to the scene where they searched the car and found a loaded Ruger .357-caliber revolver and a loaded Smith & Wesson .9 mm-caliber pistol in a natural void behind the glove compartment. Officers also found a 60-round Magpul drum-style magazine in the back seat, one round of .45-caliber ammunition, one round of .380-caliber ammunition and eight rounds of .40-caliber ammunition in the trunk. When officers checked the status of the firearms, the Smith & Wesson pistol came back stolen. Williams admitted to handling the Smith & Wesson pistol before police stopped the vehicle.
Williams is a convicted felon and prohibited from possessing a firearm. Williams pleaded guilty to aggravated second-degree battery in Ouachita Parish on April 26, 2012. Under federal law, it is illegal for anyone who has been convicted of a felony to be in possession of any firearm or ammunition. He pleaded to the federal charges on January 30, 2019.
The ATF, Ouachita Parish Metro Narcotics Unit and the Monroe Police Department conducted the investigation. Assistant U.S. Attorney Mike O’Mara prosecuted the case.
Project Safe Neighborhoods (PSN) is the centerpiece of the Department of Justice’s violent crime reduction efforts. Project Safe Neighborhoods 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.
Mississippi Tax Return Preparer Sentenced to Prison for Filing False Tax ReturnsRead the Press Release
WASHINGTON – A former resident of Durant, Mississippi, was sentenced yesterday to 60 months in prison for preparing and filing a fraudulent claim for a tax refund with the Internal Revenue Service (IRS), announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Mike Hurst of the Southern District of Mississippi.
“Dishonest tax return preparers cause serious financial harm to our country,” said Principal Deputy Assistant Attorney General Zuckerman. “The Tax Division and its partners in the U.S. Attorney’s Offices and the Internal Revenue Service are committed to the prosecution of those return preparers, who choose to commit fraud.”
“By lying and cheating our tax system, this defendant stuck her hand in every American’s pocketbook and stole money that should have gone to our families, our communities and our kids’ futures,” said U.S. Attorney Hurst. “Those who put their greed above their duty and obligation to prepare and file returns on behalf of others will experience swift and certain justice in this district. I commend our prosecutors, DOJ trial attorneys, and IRS special agents for quickly bringing this tax cheat to justice.”
“Teresa Chism was part of a significant tax fraud scheme. Mo’ Money franchise tax return preparers defrauded American taxpayers by soliciting the issuance of undeserved tax refunds,” said Special Agent in Charge, Thomas J. Holloman III, IRS Criminal Investigation. “It is a great day for every taxpaying citizen when a participant in their criminal scheme is held accountable. With the recent conclusion of tax filing season, others who have attempted similar thefts from the US Treasury should be aware that the special agents of IRS – Criminal Investigation will continue the aggressive pursuit of those individuals who attempt to defraud America's tax system."
According to documents and information provided to the court, from 2005 through 2015, Teresa C. Chism operated tax return preparation businesses in Mississippi under the names Mo’ Money, MoneyCo USA, and Lady T Taxes. Chism falsified her clients’ returns in different ways in order to increase their tax refunds, including reporting false wages, self-employment income and expenses, and education credits. In total, Chism prepared more than 550 false income tax returns, seeking over $3.5 million in fraudulent tax refunds.
In addition to the term of prison imposed, U.S. District Judge Henry T. Wingate ordered Chism to serve three years of supervised release and pay $135,134 in restitution to the IRS.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Hurst commended special agents of IRS Criminal Investigation, who conducted the investigation, and Trial Attorney William Montague of the Tax Division and Assistant U.S. Attorney Mary Helen Wall of the Southern District of Mississippi, who prosecuted the case.
Mississippi Tax Return Preparer Sentenced to Prison for Filing False Tax ReturnsRead the Press Release
A former resident of Durant, Mississippi, was sentenced yesterday to 60 months in prison for preparing and filing a fraudulent claim for a tax refund with the Internal Revenue Service (IRS), announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Mike Hurst of the Southern District of Mississippi.
“Dishonest tax return preparers cause serious financial harm to our country,” said Principal Deputy Assistant Attorney General Zuckerman. “The Tax Division and its partners in the U.S. Attorney’s Offices and the Internal Revenue Service are committed to the prosecution of those return preparers, who choose to commit fraud.”
“By lying and cheating our tax system, this defendant stuck her hand in every American’s pocketbook and stole money that should have gone to our families, our communities and our kids’ futures,” said U.S. Attorney Hurst. “Those who put their greed above their duty and obligation to prepare and file returns on behalf of others will experience swift and certain justice in this district. I commend our prosecutors, DOJ trial attorneys, and IRS special agents for quickly bringing this tax cheat to justice.”
“Teresa Chism was part of a significant tax fraud scheme. Mo’ Money franchise tax return preparers defrauded American taxpayers by soliciting the issuance of undeserved tax refunds,” said Special Agent in Charge, Thomas J. Holloman III, IRS Criminal Investigation. “It is a great day for every taxpaying citizen when a participant in their criminal scheme is held accountable. With the recent conclusion of tax filing season, others who have attempted similar thefts from the US Treasury should be aware that the special agents of IRS – Criminal Investigation will continue the aggressive pursuit of those individuals who attempt to defraud America's tax system."
According to documents and information provided to the court, from 2005 through 2015, Teresa C. Chism operated tax return preparation businesses in Mississippi under the names Mo’ Money, MoneyCo USA, and Lady T Taxes. Chism falsified her clients’ returns in different ways in order to increase their tax refunds, including reporting false wages, self-employment income and expenses, and education credits. In total, Chism prepared more than 550 false income tax returns, seeking over $3.5 million in fraudulent tax refunds.
In addition to the term of prison imposed, U.S. District Judge Henry T. Wingate ordered Chism to serve three years of supervised release and pay $135,134 in restitution to the IRS.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Hurst commended special agents of IRS Criminal Investigation, who conducted the investigation, and Trial Attorney William Montague of the Tax Division and Assistant U.S. Attorney Mary Helen Wall of the Southern District of Mississippi, who prosecuted the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Michigan Healthcare Management Company Owner and Operator Plead Guilty to Payroll Tax FraudRead the Press Release
A resident of Ft. Lauderdale, Florida, and a resident of Boca Raton, Florida, each pleaded guilty today in the Eastern District of Michigan to failing to collect, truthfully account for, and pay over payroll taxes announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division.
According to court documents, Integrated HCS Practice Management LLC (Integrated), was a Southfield, Michigan, company that provided management services to healthcare providers. As the managing partner of Integrated, a partial owner of the business, and an individual who exercised control over the business’s finances, Edward Cespedes was responsible for Integrated’s payroll taxes. Payroll taxes include federal income, Social Security, and Medicare taxes withheld from the wages paid to employees of the business. Joseph DeSanto also had influence over Integrated’s expenditure of funds, and was responsible for the payroll taxes. Despite their responsibilities, Cespedes and DeSanto failed to cause Integrated to timely pay its payroll taxes to the Internal Revenue Service (IRS) for the third quarter of 2013, the fourth quarter of 2013, and the first quarter of 2014.
Joseph DeSanto also pleaded guilty to one count of failure to file his personal tax return for 2013.
Sentencing is scheduled for Feb. 20, 2020. Both Cespedes and DeSanto face a maximum sentence of five years of imprisonment on the payroll tax charge, and DeSanto faces up to an additional one year of imprisonment on the charge related to his failure to file a tax return.
Acting Deputy Assistant Attorney General Goldberg commended special agents of the Internal Revenue Service’s Criminal Investigation Division and the Federal Bureau of Investigation, who conducted the investigation, and Tax Division Trial Attorneys Mark McDonald and William Guappone, who are prosecuting the case.
Mesa Man Sentenced to 15 Years for ManslaughterRead the Press Release
PHOENIX – On April 30, 2019, Robert Lee Jose, 30, of Mesa, Ariz., was sentenced by U.S. District Judge Neil V. Wake to 15 years in prison, to be followed by three years of supervised release. Jose had previously pleaded guilty to voluntary manslaughter. On March 28, 2018, Jose shot the victim in the head following a short, heated argument, killing the victim. Both Jose and the victim are members of the Gila River Indian Community.
The investigation in this case was conducted by the Gila River Police Department. The prosecution was handled by Raynette Logan, Assistant U.S. Attorney, District of Arizona, Phoenix.
CASE NUMBER: CR-18-497-PHX-NVW
RELEASE NUMBER: 2019-058_Jose
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For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Mercer County Felon Sentenced to Prison for Federal Gun CrimeRead the Press Release
HUNTINGTON, W.Va. – A Mercer County, West Virginia, felon who possessed a firearm in May 2018, was sentenced today to 37 months in prison, announced United States Attorney Mike Stuart.
Kelvin Maurice Freeman, 29, previously admitted that on May 31, 2018, he possessed a firearm while he was traveling on Interstate 64 in Cabell County, West Virginia. Freeman was prohibited from possessing any firearm under federal law because he was convicted in April 2018 for Child Endangerment in Tazewell County, Virginia.
The West Virginia State Police conducted the investigation. United States District Judge Robert C. Chambers imposed the sentence. Assistant United States Attorney Stephanie S. Taylor prosecuted the case.
Project Safe Neighborhoods (PSN) is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
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Manhattan U.S. Attorney Announces Lawsuit Against Chestnut Petroleum Distributor, Inc., for Violations of the Resource Conservation and Recovery ActRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York (“SDNY”), and Peter D. Lopez, Regional Administrator of the U.S. Environmental Protection Agency (“EPA”), announced today that the United States has filed a civil lawsuit against Chestnut Petroleum Distributor, Inc., and its affiliates CPD Energy Corp., CPD NY Energy Corp., Chestnut Mart of Gardiner, Inc., Chestnut Marts, Inc., Greenburgh Food Mart, Inc., Middletown Food Mart, Inc., and NJ Energy Corp. (collectively, “Defendants”), for violating the Resource Conservation and Recovery Act (“RCRA”) at 20 separate gas stations within the Southern District of New York and adjoining districts.
U.S. Attorney Geoffrey S. Berman stated: “As alleged in the complaint, Defendants repeatedly failed to comply with regulations designed to prevent gasoline leaks from threatening public health and the environment. Today’s lawsuit seeks to hold Defendants accountable for their conduct and ensure that the public is protected in the future.”
EPA Regional Administrator Peter D. Lopez said: “Failure to monitor and maintain tanks to prevent leaks can pose a serious safety risk, as the leaking underground tanks can release toxic components that can seep into the soil and the groundwater. This lawsuit seeks to hold the companies responsible for properly managing their tanks to reduce these risks where these gas stations are located.”
Petroleum products such as gasoline contain chemical compounds that pose substantial threats to human health. Service stations typically store gasoline in underground storage tanks. When operated conscientiously and monitored closely, underground storage tanks are a safe and effective means to store gasoline. But when those tanks are not subjected to basic operational safeguards, they can endanger the public and the environment, for example by leaking petroleum into the water supply, discharging toxic vapors into the air, or even triggering fires or explosions. EPA’s regulations under RCRA are designed to protect the public by requiring underground storage tank operators to reduce the likelihood of leaks, monitor for leaks so they can promptly be addressed, and maintain adequate insurance to conduct corrective action and compensate injured third parties when a leak occurs.
As alleged in the complaint filed in federal district court today, Defendants repeatedly violated RCRA and its related regulations at various times from 2011 to 2014. These violations included failing to perform release (i.e., leak or spill) detection, and failing to maintain and provide records of release detection monitoring. In some instances, Defendants failed to secure underground storage tanks that were temporarily closed, and failed to investigate or report suspected releases or unusual operating conditions. Defendants also failed at times to maintain insurance policies sufficient to take corrective action and compensate third parties for bodily injury and property damage caused by accidental releases arising from the operation of the underground storage tanks.
The lawsuit seeks injunctive relief and an order imposing civil penalties for Defendants’ violations.
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This case is being handled by the Office’s Environmental Protection Unit. Assistant United States Attorneys Christopher Connolly and Jennifer C. Simon are in charge of the case.
Man Convicted of Filing False Tax ReturnRead the Press Release
HOUSTON – A local man has entered a guilty plea to filing false joint 2015 tax return, admitting he falsely claimed a tax refund of more than $15,000, announced U.S. Attorney Ryan K. Patrick along with Acting Special Agent in Charge Sarah Kull of IRS-Criminal Investigation (CI).
According to the plea agreement filed in the record of the case, Christopher Hatton falsely inflated the amount of federal income tax withholdings and unreimbursed employee expenses claimed on his joint 2015 income tax return. The inflations were more than $38,000 each in withholdings and unreimbursed employee expenses.
Hatton’s tax return claimed a false income tax refund of in excess of $15,000 when he actually owed more than $18,000 in income taxes for the year.
The plea agreement further states when audited, Hatton provided an altered form W-2 and altered bank statements to support the false amounts claimed on his 2015 tax return. Hatton further admitted he also filed tax returns for 2012, 2013, 2014 and 2016, claiming false items.
The plea agreement further indicates the total tax loss Hatton caused the IRS was in excess of $126,000.
U.S. District Judge Nancy Atlas accepted the guilty plea and has sentencing for July 17, 2019. At that time, Hatton faces up to three years in federal prison and a possible $250,000 maximum fine.
He was permitted to remain on bond pending that hearing.
IRS-CI conducted the investigation. Assistant U.S. Attorney Charles J. Escher is prosecuted the case.
Local Medical Doctor Sentenced for Illegally Dispensing and Distributing Controlled Substances by Prescriptions and Money LaunderingRead the Press Release
NEW ORLEANS – U.S. Attorney Peter G. Strasser announced that WAYNE JEROME CELESTINE, M.D., age 58, a physician who practiced in Gretna and resided in New Orleans, was sentenced today after previously pleading guilty to two counts in the Second Superseding Indictment, which charged him with illegally dispensing controlled substances and money laundering.
U.S. District Judge Jane Triche Milazzo sentenced DR. CELESTINE to (7) seven years (84 months) imprisonment. On Monday, April 30, 2018, DR. CELESTINE was arrested on charges of distribution of controlled substances. According to court records, DR. CELESTINE illegally dispensed and conspired with others to illegally dispense controlled substances, including oxycodone, a Schedule II drug controlled substance. On November 29, 2018, DR. CELESTINE plead guilty to two counts of the Second Superseding Indictment.
In addition to the (7) seven year term of incarceration, DR. CELESTINE was fined $20,000 and will face a term of supervised release of (3) three years, following the term of imprisonment. Pursuant to the terms of the plea agreement, DR. CELESTINE has been ordered to forfeit to the United States: over $1 million in seized currency, investment accounts, and negotiable instruments; and over $1 million in seized vehicles, residences, and commercial properties. By virtue of the plea agreement, DR. CELESTINE acknowledged that these assets represent proceeds and/or facilitating property of the crimes for which he has pled guilty.
This prosecution is part of an extensive investigation by the Organized Crime Drug Enforcement Task Force (OCDETF). OCDETF is a joint federal, state and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional level drug trafficking organizations and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.
U.S. Attorney Strasser praised the work of the Drug Enforcement Administration, Internal Revenue Service, Jefferson Parish Sheriff’s Office, Harahan Police Department, Westwego Police Department, Louisiana State Police, St. Bernard Parish Sheriff’s Office, New Orleans Police Department, and New Orleans District Attorney’s Office in investigating this matter. Assistant United States Attorneys John F. Murphy and Andre J. Lagarde are in charge of the prosecution.
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Lawrence Man Sentenced for Conspiracy to Distribute FentanylRead the Press Release
BOSTON – A Lawrence man was sentenced today in federal court in Boston for his role in a fentanyl distribution conspiracy in the Merrimack Valley.
Antonio Camillo, 21, was sentenced by U.S. District Court Judge Denise J. Casper to 34 months in prison and three years of supervised release. On Feb. 4, 2019, the defendant pleaded guilty to one count of conspiracy to distribute and possession with intent to distribute 400 grams or more of fentanyl and one count of distribution of and possession with intent to distribute fentanyl.
In September 2018, Camillo sold nearly 40 grams of fentanyl to an undercover police officer during a months-long federal investigation. Camillo was part of a drug organization that was distributing large quantities of fentanyl throughout the Merrimack Valley. In October 2018, Camillo was charged and arrested along with dozens more during a federal sweep targeting impact players and repeat offenders in and around the City of Lawrence.
United States Attorney Andrew Lelling and Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration’s New England Field Division made the announcement. Assistant U.S. Attorney Philip C. Cheng of Lelling’s Narcotics and Money Laundering prosecuted the case.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
Laurinburg Man Sentenced to 96 Months in Prison for Firearms and Drug ChargesRead the Press Release
GREENSBORO, N.C. – A Laurinburg man who sold firearms and cocaine was sentenced to federal prison Tuesday, announced Matthew G.T. Martin, United States Attorney for the Middle District of North Carolina.
TONY DEVONTA WHITE EVERETTE, 26, pleaded guilty on December 28, 2018, to two counts of possession of a firearm by a previously convicted felon, two counts of distribution of cocaine base (“crack”), one count of distribution of cocaine, and one count of possessing a firearm during and in relation to a drug trafficking crime. On April 29, 2018, EVERETTE was sentenced by United States District Judge William L. Osteen Jr. to 96 months of imprisonment, followed by 5 years of supervised release.
On three occasions beginning on April 18, 2018, and ending onMay 18, 2018, EVERETTE sold firearms, crack cocaine, and cocaine powder to a confidential informant working with the Bureau of Alcohol, Tobacco, Firearms and Explosives. EVERETTE sold two handguns, approximately 74 grams of crack cocaine, and approximately 27 grams of cocaine hydrochloride (powder) during that period, with all of those sales occurring in Scotland County, North Carolina. EVERETTE had previously been convicted of possession of a firearm by a felon in state court in Scotland County.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Laurinburg Police Department, and prosecuted by Assistant United States Attorney Anand P. Ramaswamy for the Middle District of North Carolina.
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Lake Worth Resident Sentenced to Life in Prison for Sex Trafficking and ObstructionRead the Press Release
A Lake Worth resident was sentenced to life in prison today, after having been convicted at trial of sex trafficking and obstruction of a sex trafficking investigation.
Ariana Fajardo Orshan, U.S. Attorney for the Southern District of Florida, David Aronberg, State Attorney for Palm Beach County, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation, (FBI), Miami Field Office and Ric Bradshaw, Sheriff, Palm Beach County Sheriff’s Office (PBSO) made the announcement.
Alston Orlando Leroy Williams, 42, of Lake Worth, Florida, was sentenced by U.S. District Judge Robin L. Rosenberg to five life sentences and an additional 20 years in prison, to be followed by a lifetime of supervised release (Case No. 18-CR-80053). In December of 2018, Williams was convicted by a federal trial jury of two counts of sex trafficking of a minor in violation of Title 18, United States Code, Sections 1591(a)(1) and (b)(2), three counts of sex trafficking by force, fraud or coercion in violation of Title 18, United States Code, Sections 1591(a)(1) and (b)(1), and one count of obstructing a human trafficking investigation, in violation of Title 18, United States Code, Section 1591(d).
According to evidence and testimony presented at trial, from 2008 through 2017, Williams trafficked multiple women, including two juveniles, for commercial sex throughout Florida. Williams had the women live at his homes and travel to hotels and other locations to meet adult men and engage in sexual acts for money. Williams used force, violence and coercion to traffic the women and kept all of the money earned by the victims. He was arrested on November 29, 2017 on related state charges, before being charged and convicted federally.
U.S. Attorney Fajardo Orshan commended the investigation efforts of the FBI, PBSO, and the Palm Beach County Human Trafficking Task Force in this matter. Mrs. Fajardo Orshan thanked Palm Beach County State Attorney Dave Aronberg for the 15th Judicial Circuit and his staff for their assistance with this investigation. This case was prosecuted by Assistant U.S. Attorney Gregory Schiller and Special Assistant U.S. Attorney Justin Hoover.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or at http://pacer.flsd.uscourts.gov.
Kissimmee Man Convicted for Sending Death Threats to Senator Bernie SandersRead the Press Release
Orlando, FL – United States Attorney Maria Chapa Lopez announces that a federal jury yesterday found Robert Francis Pratersch (57, Kissimmee) guilty of threatening a federal official and interstate transmission of a threat to injure. Pratersch faces a maximum penalty of 15 years in federal prison. His sentencing hearing is scheduled for July 16, 2019.
According to evidence presented at trial, Pratersch left three threatening voicemail messages at the Office of Senator Bernie Sanders in Burlington, Vermont. These profanity-laced messages included a threat to “behead” Senator Sanders, “ISIS-style,” and videotape the execution. The messages also included numerous anti-Semitic remarks directed at Senator Sanders.
This case was investigated by the Federal Bureau of Investigation and the United States Capitol Police. It is being prosecuted by Assistant United States Attorney Vincent S. Chiu.
Kentucky Deputy Jailer Convicted of Assaulting InmateRead the Press Release
A federal jury in Paducah, Kentucky, convicted a deputy jailer at the Fulton County Detention Center of violating the civil rights of an inmate by assaulting him with a dangerous weapon. The jury convicted James Eakes, 54, of willfully depriving an inmate of the right to be free from cruel and unusual punishment. According to evidence and testimony, Eakes repeatedly tased inmate L.B. after L.B. cursed at him.
“The Department of Justice does not tolerate any physical abuse of inmates, especially by a correctional officer entrusted to their care,” said Assistant Attorney General Eric Dreiband. “The Civil Rights Division will continue to uphold the Constitution and obtain justice for the victims of civil rights abuses.”
“The rule of law applies equally to all persons in our Commonwealth,” said U.S. Attorney Russell Coleman. “And we will enforce the law without regard to position or office held.”
The evidence and testimony revealed that Eakes was first called to L.B.’s cell because L.B. told guards he was suicidal. As required by the jail’s procedures, Eakes and two other female deputy jailers then removed all of L.B.’s possessions from his cell and made L.B. strip naked. Eakes left the cell and closed the door, which automatically locked, leaving L.B. in his cell with only an anti-suicide garment.
The evidence and testimony showed that, after he was locked in his cell, L.B. cursed at Eakes from behind the cell door. Eakes then ordered that the door be unlocked, removed his Taser from his holster, opened the door, and immediately shot L.B. with his Taser. Eakes then entered L.B.’s cell, and, while activating the Taser, repeatedly yelled at L.B. not to curse at him again. Despite the fact that L.B. took no aggressive action towards Eakes and remained slumped against the cell wall, Eakes tased L.B. two additional times.
Eakes faces a maximum term of imprisonment of 10 years. Sentencing has been scheduled for Aug. 30.
The FBI conducted the investigation. Assistant United States Attorney Madison Sewell of the Western District of Kentucky and Trial Attorney Zachary Dembo of the Civil Rights Division prosecuted the case. Trial Attorney Sanjay Patel of the Civil Rights Division also assisted in the investigation.
Justice Department Reaches Settlement Agreement with Alaska Native Corporation over Allegations of Violating the Federal False Claims ActRead the Press Release
Kikiktagruk Inupiat Corporation (“KIC”), an Alaska Native Corporation, and KIC Development LLC (“KICD”), a subsidiary of KIC, have agreed to pay $2.025 million to settle allegations that kickbacks were paid by KICD so that the company would obtain diverted “set aside” contracts to do construction work at Ft. Bliss military installation in El Paso, Texas, announced U.S. Attorney John F. Bash.
“Kickbacks corrupt the public trust in government contracting,” said U.S. Attorney Bash. “It is critical that we work to ensure the award of any government contract is not influenced by illegal kickbacks or arrangements.”
As an Alaska Native Corporation, KIC is deemed a small business concern which qualifies for Small Business Administration sole-source, no-bid government (“set aside”) contracts. KICD was a wholly and/or majority-owned subsidiary of KIC and therefore also qualified for the government set-aside contracts. KICD has since filed articles of dissolution in Alaska.
On January 14, 2010, Susann Campbell filed a qui tam action in the U.S. District Court for the Western District of Texas, alleging that KICD, through its employees Anthony Acri, Christine Hayes and Earl Hall, paid illegal kickbacks and bribes to James G. Tuskan, a contract employee with the U.S. Army Corp of Engineers. Through this bribery scheme, Tuskan allegedly used his position as a contract employee with the U.S. Army Corp of Engineers to steer the “set aside” government contracts issued out of Ft. Bliss to KICD. Tuskan also allegedly provided KICD with confidential government information, thereby ensuring that KICD would be awarded the contracts.
The FBI conducted an extensive investigation into the alleged bribery scheme which led to the criminal prosecution of Tuskan, Acri, Hayes, and Hall. All four individuals pleaded guilty to the bribery scheme in 2016.
At the conclusion of the criminal case, the U.S. Attorney’s Office, in conjunction with the DOJ Civil Division, resumed its civil investigation against KICD and the four named individuals in an effort to recover some of the federal funds that were illegally obtained by the defendants. The U.S. has now reached a settlement with KICD and its parent corporation KIC for a total of two million and twenty five thousand dollars ($2,025,000.00)
This matter was investigated by the Federal Bureau of Investigations, the Defense Criminal Investigative Service and the Army Criminal Investigation Command, Major Procurement Fraud Unit, and Small Business Administration Office of Inspector General.
The claims asserted against the defendants are allegations only; there has been no determination of liability. The civil settlement was reached by Assistant United States Attorney Eduardo R. Castillo.
Judge Hands Down 88 Months Prison Sentence to Tifton Woman Caught Hauling Kilos of Meth, Cocaine on I-75Read the Press Release
MACON – A Tifton woman was sentenced to 88 months in prison Wednesday on a drug charge after she was arrested carrying four kilos of meth and cocaine in her car with the intent to distribute the illegal drugs, said Charles “Charlie” Peeler, the United States Attorney for the Middle District of Georgia. Anna Maria Lopez-Vazquez, 32, of Tifton, GA was sentenced by the Honorable Marc Treadwell in Macon federal court this morning. She had previously entered a guilty plea to one count Possession with Intent to Distribute Methamphetamine on February 13, 2019. There is no parole in the federal prison system.
According to her signed plea agreement, on May 18, 2017, Anna Maria Lopez-Vasquez was driving a Yukon SUV southbound on I-75 in Peach County, Georgia. A Peach County deputy on patrol in the area spotted the SUV with an obscured license and failing to maintain its lane of traffic, both traffic infractions in Georgia. During the traffic stop, the deputy smelled a strong odor of marijuana. Following a legal search of the vehicle, 2,942 grams of methamphetamine and 999 grams of cocaine were found in three containers, sealed with plastic wrap, hidden inside a sports bag. Ms. Lopez-Vasquez was arrested. In a post-arrest interview, she admitted that the drugs belonged to her.
“Methamphetamine is killing more and more Georgians,” said Charles “Charlie” Peeler, the U.S. Attorney for the Middle District of Georgia. “It is imperative that we get this poison off our streets. Our office will continue to work with federal, state and local law enforcement to identify, arrest and prosecute those who choose to sell illegal drugs in our communities. Make no mistake: if you choose to sell methamphetamine, you will go to federal prison for a long time. I applaud the good work of the Peach County Sheriff’s Office in this matter.”
“Routine traffic stops are valuable. In this case, we were able to get 3 kilos of meth and 1 kilo of cocaine out of our communities,” said Sheriff Terry Deese, Peach County Sheriff’s Office. “Ms. Lopez-Vasquez is from a small town in South Georgia, and taking that much dope off the streets will have a big impact on the drug problem in that town. Our deputies are trained to properly and legally identify certain conditions in a traffic stop that might alert them to illegal activities. In this case, our deputies found a massive amount of deadly poison that will no longer be peddled to our children.”
The case is being investigated by The Drug Enforcement Agency and the Peach County Sheriff’s Office. Assistant U.S. Attorney Charles Calhoun is prosecuting the case for the Government. Questions can be directed to Pamela Lightsey, Public Information Officer, United States Attorney’s Office, at (478) 621-2603 or Melissa Hodges, Public Affairs Director (Contractor), United States Attorney’s Office, at (478) 765-2362.
Insulation Contractor Executive Pleads Guilty to Antitrust and Fraud ChargesRead the Press Release
WASHINGTON – Michael S. Flynn, executive and co-owner of an insulation contractor, pleaded guilty today in Bridgeport, Connecticut, for his role in multiple schemes to rig bids in violation of the antitrust laws and to engage in criminal fraud on insulation contracts, marking the second conviction in this ongoing investigation, the Department of Justice announced.
According to court documents, from October 2011 and continuing until March 2018, Flynn, of Ridgefield, Connecticut, conspired with other insulation contractors to rig bids and engage in fraud on contracts for installing insulation around pipes and ducts on construction projects at universities, hospitals, and other public and private entities in Connecticut, New York, and Massachusetts. The conspirators discussed prices and agreed on bids that inflated prices to their customers by at least 10%. In order to conceal their actions, the conspirators perpetrated the bid-rigging and fraud schemes using burner phones and an encrypted disappearing messaging app.
“Today’s guilty plea is the second relating to a $45 million scheme to cheat New England schools, hospitals, and other businesses by agreeing to fix prices on insulation contracts in violation of the antitrust laws,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division. “As this prosecution shows, the Justice Department and our law enforcement partners, including the FBI and DCIS, will use every available resource to detect and bring to justice individuals who attempt to hide their criminal conduct by using high-tech encryption apps, burner phones, or any other means.”
“This defendant profited handsomely by colluding with other insulation contractors and inflating bids on $45 million worth of insulation jobs,” said U.S. Attorney John H. Durham for the District of Connecticut. “The scheme victimized hospitals, universities and businesses throughout New England. I thank the FBI, DCIS, and the Antitrust Division for their ongoing efforts to bring the perpetrators of this brazen scheme to justice.”
“Based on the great work of joint law enforcement efforts, the judicial system has clearly confirmed that crimes of deceit and fraud against hard working members of our communities will not go unpunished,” said Brian C. Turner, Special Agent in Charge of FBI’s New Haven Field Office.
“Ensuring the integrity of the U.S. Department of Defense’s (DoD) procurement process is a top priority for the Defense Criminal Investigative Service (DCIS),” stated Leigh-Alistair Barzey, Special Agent in Charge of the DCIS Northeast Field Office. “Bid-rigging and fraud schemes, such as the ones in this case, can cause serious economic damage to the DoD’s resources, which ultimately harms the American taxpayer and the U.S. military. Today’s guilty plea is the direct result of a joint effort and demonstrates the DCIS’ commitment to work with the FBI, the Antitrust Division, and the U.S. Attorney’s Office to investigate and prosecute individuals and companies that engage in fraudulent activity impacting the DoD.”
The antitrust charge announced today carries a maximum penalty of 10 years in prison and a fine of $1 million for individuals. The fraud conspiracy charge carries a maximum penalty of 20 years in prison and a fine of $250,000. The fines for the antitrust and fraud conspiracy charges may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
In addition to his guilty plea, Flynn has agreed to pay restitution to the victims and to resolve civil forfeiture cases connected to the criminal charges. Flynn agreed to settle the pending forfeiture action on his home for $327,500 and to forfeit all of his seized bank accounts.
The ongoing investigation is being conducted by the Antitrust Division’s New York Office, the United States Attorney’s Office for the District of Connecticut, the FBI’s New Haven Division, and the Defense Criminal Investigative Service. Anyone with information in connection with this investigation is urged to call the Antitrust Division’s New York Section at 212-335-8035, or visit http://www.justice.gov/atr/contact/newcase.html.
Insulation Contractor Executive Pleads Guilty to Antitrust and Fraud ChargesRead the Press Release
Michael S. Flynn, executive and co-owner of an insulation contractor, pleaded guilty today in Bridgeport, Connecticut, for his role in multiple schemes to rig bids in violation of the antitrust laws and to engage in criminal fraud on insulation contracts, marking the second conviction in this ongoing investigation, the Department of Justice announced.
According to court documents, from October 2011 and continuing until March 2018, Flynn, of Ridgefield, Connecticut, conspired with other insulation contractors to rig bids and engage in fraud on contracts for installing insulation around pipes and ducts on construction projects at universities, hospitals, and other public and private entities in Connecticut, New York, and Massachusetts. The conspirators discussed prices and agreed on bids that inflated prices to their customers by at least 10%. In order to conceal their actions, the conspirators perpetrated the bid-rigging and fraud schemes using burner phones and an encrypted disappearing messaging app.
“Today’s guilty plea is the second relating to a $45 million scheme to cheat New England schools, hospitals, and other businesses by agreeing to fix prices on insulation contracts in violation of the antitrust laws,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division. “As this prosecution shows, the Justice Department and our law enforcement partners, including the FBI and DCIS, will use every available resource to detect and bring to justice individuals who attempt to hide their criminal conduct by using high-tech encryption apps, burner phones, or any other means.”
“This defendant profited handsomely by colluding with other insulation contractors and inflating bids on $45 million worth of insulation jobs,” said U.S. Attorney John H. Durham for the District of Connecticut. “The scheme victimized hospitals, universities and businesses throughout New England. I thank the FBI, DCIS, and the Antitrust Division for their ongoing efforts to bring the perpetrators of this brazen scheme to justice.”
“Based on the great work of joint law enforcement efforts, the judicial system has clearly confirmed that crimes of deceit and fraud against hard working members of our communities will not go unpunished,” said Brian C. Turner, Special Agent in Charge of FBI’s New Haven Field Office.
“Ensuring the integrity of the U.S. Department of Defense’s (DoD) procurement process is a top priority for the Defense Criminal Investigative Service (DCIS),” stated Leigh-Alistair Barzey, Special Agent in Charge of the DCIS Northeast Field Office. “Bid-rigging and fraud schemes, such as the ones in this case, can cause serious economic damage to the DoD’s resources, which ultimately harms the American taxpayer and the U.S. military. Today’s guilty plea is the direct result of a joint effort and demonstrates the DCIS’ commitment to work with the FBI, the Antitrust Division, and the U.S. Attorney’s Office to investigate and prosecute individuals and companies that engage in fraudulent activity impacting the DoD.”
The antitrust charge announced today carries a maximum penalty of 10 years in prison and a fine of $1 million for individuals. The fraud conspiracy charge carries a maximum penalty of 20 years in prison and a fine of $250,000. The fines for the antitrust and fraud conspiracy charges may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.
In addition to his guilty plea, Flynn has agreed to pay restitution to the victims and to resolve civil forfeiture cases connected to the criminal charges. Flynn agreed to settle the pending forfeiture action on his home for $327,500 and to forfeit all of his seized bank accounts.
The ongoing investigation is being conducted by the Antitrust Division’s New York Office, the United States Attorney’s Office for the District of Connecticut, the FBI’s New Haven Division, and the Defense Criminal Investigative Service. Anyone with information in connection with this investigation is urged to call the Antitrust Division’s New York Section at 212-335-8035, or visit http://www.justice.gov/atr/contact/newcase.html.
Illegal Alien Pleads Guilty to Unlawful Reentry After RemovalRead the Press Release
Gulfport, Miss. –Juan Carlos Rodriguez-Morales, 39, an illegal alien from Honduras, pled guilty today before U.S. District Judge Sul Ozerden to unlawful reentry by an alien after removal, announced U.S. Attorney Mike Hurst, and Mr. Trey Lund, Acting Field Office Director of Immigration and Customs Enforcement, Enforcement and Removal Operations in New Orleans.
Rodriguez-Morales will be sentenced by Judge Ozerden, on July 25, 2019, at 9:30 a.m. He faces a potential maximum of 2 years in prison and a $250,000 fine. He also faces being removed from the United States following the completion of any prison sentence.
On February 3, 2019, a Hancock County Sheriff’s Deputy conducted a traffic stop on Rodriguez-Morales’ vehicle for failing to yield to an emergency vehicle displaying emergency lights. Rodriguez-Morales was arrested for that offense and for driving without a license. He was convicted of both misdemeanor offenses in Hancock County. Hancock County officials notified Immigration & Customs Enforcement (ICE) Enforcement Removal Operations (ERO).
On February 6, 2019, an ERO Deportation Officer interviewed Rodriguez-Morales who confessed that he is an illegal alien from Honduras, and was later positively identified via a fingerprint scan. Rodriguez-Morales had been physically removed from the United States on multiple occasions pursuant to a lawful removal order & did not have permission to reenter. Records indicate that, beginning in 2001, Rodriguez-Morales was removed from the United States on three different occasions, before reentering the United States illegally on this most recent occasion.
U.S. Attorney Hurst praised the cooperation exhibited by the Department of Homeland Security, Immigration & Customs Enforcement, Enforcement Removal Operations, the Harrison County Sheriff’s Department and the Hancock County Sheriff’s Department. Assistant United States Attorney Stan Harris is the prosecutor on the case.
Human Smuggler Pleads Guilty to Transporting Illegal AliensRead the Press Release
Gulfport, Miss. – Paul Garza, 50, of Houston, Texas, pled guilty yesterday before U.S. District Judge Sul Ozerden to transporting illegal aliens within the United States, announced U.S. Attorney Mike Hurst, Jere T. Miles, Special Agent in Charge of U.S. Immigration & Customs Enforcement's Homeland Security Investigations in New Orleans, and Gregory K. Bovino, Chief Patrol Agent of the U.S. Border Patrol’s New Orleans Sector.
On March 22, 2019, a U.S. Border Patrol Agent conducted a traffic stop on a Dodge SUV with Texas license plates around the 40-mile marker on Interstate 10 eastbound. The agent noticed multiple indicators that smuggling actively was taking place. Ironically, the same agent had been present when the same vehicle had been previously encountered in September 2018, in Jackson, Mississippi, in an alien smuggling venture. The agent determined that none of the passengers had proper documents and that all were illegally present in the United States.
A Homeland Security Investigations Special Agent joined the investigation at the Gulfport Border Patrol Station and determined that all the other occupants of the vehicle were being smuggled by Paul Garza. Investigation revealed that front seat passenger, Paul Garza, actually was the primary driver; but, had been temporarily replaced as driver due to Garza’s becoming sleepy and weaving on the road. It also was noted that, while the vehicle was equipped with 7 seatbelts, it had 9 occupants, thereby depriving two of the occupants from wearing seatbelts.
Two of the illegal alien passengers were determined to be unaccompanied juveniles. Additionally, Ms. Catarina Ixquiactap Morales, an illegal alien from Guatemala, was determined to have unlawfully returned after removal from the United States, and is being separately prosecuted for that felony offense. All of the illegal alien passengers except for Ms. Morales, were determined to have been apprehended for the first time in the United States and were placed into administrative proceedings to be officially removed from the United States.
Garza is scheduled to be sentenced by Judge Ozerden on August 1, 2019 at 10:00 a.m., and faces a potential maximum 5 years imprisonment, as well as 3 years supervised release, a maximum $250,000 fine, and special assessments that could total $5,100. Garza is a U.S. Citizen living in the Houston, Texas, area.
U.S. Attorney Hurst praised the cooperation exhibited by the Department of Homeland Security, United States Border Patrol, and by Homeland Security Investigations. Assistant United States Attorney Stan Harris is the prosecutor for the case.
High Desert Pharmacist Pleads Guilty to Illegal Distribution of Prescription Opioids and Laundering the Proceeds of the Illicit SalesRead the Press Release
LOS ANGELES – A High Desert pharmacist has pleaded guilty to a federal charge of illegally distributing the opioid oxycodone, admitting that she filled hundreds of counterfeit prescriptions.
Pauline Tilton, 49, of Hesperia, a licensed pharmacist and the owner of Oasis Pharmacy in Victorville, pleaded guilty Monday to one count of distribution of oxycodone and one count of money laundering related to more than a quarter millions dollars of revenue generated by the illegal sales.
In conjunction with Tilton’s guilty pleas, Oasis Pharmacy also pleaded guilty Monday to the same two felony offenses.
According to court documents, over the course of just one year that ended in July 2017, Tilton filled at least 345 fraudulent prescriptions for oxycodone. The prescriptions were written under the name and DEA registration number of a retired doctor. Tilton admitted knowing the prescriptions were fraudulent, outside the usual scope of professional practice, and without a legitimate medical purpose.
As a result of the 345 prescriptions, Tilton and Oasis Pharmacy illegally diverted approximately 62,100 tablets of oxycodone. Many of the fraudulent oxycodone prescriptions also included prescriptions for alprazolam and promethazine with codeine. Those three drugs – oxycodone, alprazolam, and promethazine with codeine – comprise the “Holy Trinity,” a frequently abused and life-threatening cocktail of controlled substances.
In return for filling the fake prescriptions, Tilton and Oasis Pharmacy received hundreds of thousands of dollars in cash payments. Between January 2016 and June 2017, Tilton deposited $268,621 of illicit cash proceeds from her illegal drug distribution into three banks accounts over which Tilton held sole signature authority.
Tilton and Oasis Pharmacy pleaded guilty before United States District Judge Otis D. Wright II, who scheduled sentencing hearings on August 12 for both defendants.
When she is sentenced, Tilton will face a statutory maximum penalty of 30 years in federal prison. Oasis Pharmacy could be ordered a fine of up to $1.25 million.
This case was the first to be charged as the result of an investigation into corrupt pharmacies dubbed “Operation Faux Pharmacy.”
This case is being investigated by the Drug Enforcement Administration; the U.S. Department of Health and Human Services, Office of Inspector General; IRS Criminal Investigation; and the California Board of Pharmacy.
This matter is being prosecuted by Assistant United States Attorney Chelsea Norell of the International Narcotics, Money Laundering, & Racketeering Section.
Hartford Gang Member Sentenced to More Than 6 Years in Federal Prison for Firearm OffensesRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that JOSHUA AMARAL, also known as “Ill Child,” 34, of Hartford, was sentenced today by U.S. District Judge Jeffrey A. Meyer in New Haven to 78 months of imprisonment, followed by five years of supervised release, for firearm offenses related to a shootout in Hartford’s South End in April 2017.
According to court documents and statements made in court, this matter stems from an investigation headed by the FBI’s Northern Connecticut Violent Crimes Task Force and the Hartford Police Department’s Vice and Narcotics Division targeting gang violence and narcotics trafficking in Hartford. The investigation revealed that Wilson Velez, also known as “Wiso,” a member of the Almighty Latin Kings Nation (“Latin Kings”), was distributing heroin and fentanyl. Velez employed family members and other Latin Kings members and associates to process, package and distribute the drugs from apartment buildings on Hamilton Street and Elliot Street in Hartford. During the investigation, law enforcement conducted multiple controlled purchases of narcotics from Velez and other members of the drug trafficking organization.
On April 28, 2017, Velez, Amaral and others were involved in a shootout after they confronted a rival drug dealer in the area of Franklin Avenue and Barker Street in Hartford. Amaral, who was armed, was shot in the leg during the gunfire exchange.
On May 1, 2018, a grand jury returned a 41-count indictment charging Velez, Amaral and eight other members and associates of the Latin Kings.
Amaral has been detained since his arrest on state charges on September 15, 2017. On February 5, 2019, pleaded guilty in federal court to one count of conspiracy to possess a firearm in furtherance of a drug trafficking crime, and one count of possession of a firearm in furtherance of a drug trafficking crime.
Velez was arrested on related federal narcotics offenses on December 7, 2017, and was subsequently released on bond. He has been detained since April 5, 2018, when his bond was revoked. On February 22, 2019, he pleaded guilty to one count of conspiracy to distribute one kilogram or more of heroin and/or 400 grams or more of fentanyl, and one count of conspiracy to use and carry a firearm in relation to, and furtherance of, a drug trafficking crime. He awaits sentencing.
The FBI Task Force includes members of the Hartford Police Department, East Hartford Police Department, Connecticut State Police and Connecticut Department of Correction.
This case is being prosecuted by Assistant U.S. Attorney Brian P. Leaming.
Green Energy Fraudster Convicted at Trial for Scamming Multiple Federal Agencies, CustomersRead the Press Release
PHILADELPHIA, PA – United States Attorney William M. McSwain and Assistant Attorney General Jeffrey Bossert Clark of the Environment and Natural Resources Division (ENRD) of Department of Justice announced today that a federal jury in Reading, Pennsylvania convicted David M. Dunham, Jr. of the following crimes: conspiracy to commit wire fraud and defraud the United States; wire fraud; filing false tax documents; and obstruction of justice. The conviction stemmed from Dunham hatching and executing a scheme to defraud the Environmental Protection Agency, the Internal Revenue Service, the United States Department of Agriculture, and his customers to obtain renewable fuel credits in his “green energy” business. The government is also seeking forfeiture of approximately $1.7 million in fraudulently obtained revenue and several parcels of real estate. The trial lasted four weeks before United States District Judge Jeffrey L. Schmehl.
In Dunham’s green energy scam, he fraudulently applied for, received, and sold “credits” for selling renewable biofuels that he, in fact, did not sell and, in many instances, had never possessed in the first place. He obtained these credits from government agencies, which resulted in Dunham obtaining $50 million in fraudulent revenue. Dunham ran the scam from approximately 2010 to 2015, using his business, Smarter Fuels, and that of his co-defendant, Ralph Tomasso, who previously pleaded guilty to conspiracy to defraud federal programs.
“Though this defendant tried to deflect blame on others, his years of scamming the government and his customers has finally caught up to him,” said U.S. Attorney McSwain. “And the truth is as simple as this: Everyone has to follow the rules. You cannot lie, steal, or cover up your misdeeds. If you do, we will hold you accountable. Experience shows that fraudsters like Dunham are always looking for the next best scam. As American consumers become increasingly more concerned with energy conservation, green energy scams like the one in this case provide criminals with an easy angle. We are grateful that the jury saw through Dunham’s lies and reached the correct result.”
“Today’s conviction sends a clear message to any future fraudsters out there: crime does not pay. Especially when that crime involves defrauding American customers and multiple federal agencies,” said Assistant Attorney General Clark. “When the defendant knowingly cheated a federal government program aimed at energy conservation, he gave himself an unfair advantage over his competitors and stole millions of dollars from the American taxpayer in the process. The Department of Justice will not tolerate this type of deception and will continue to work with its law enforcement partners to root out this unlawful conduct.”
“David Dunham created an elaborate scheme that served no purpose other than to mislead and defraud the government,” said IRS Special Agent in Charge Guy Ficco. “Unfortunately for him, our special agents were able to track the movement of paperwork and uncover the deceit behind his actions. We, along with our fellow law enforcement partners and the Department of Justice, will continue to investigate and prosecute those who commit similar crimes.”
“The defendant made numerous fraudulent claims to illegally profit from the Renewable Fuel Standard (RFS) Program,” said Jessica Taylor, Director of EPA’s Criminal Investigation Division. “Today’s conviction should send a clear signal that EPA and our law enforcement partners are committed to protecting the integrity of the Energy Independence and Security Act of 2007.”
USDA-OIG Special Agent-in-Charge Bethanne M. Dinkins said, “We appreciate the commitment of the Department of Justice and the cooperative efforts of our law enforcement partners throughout this significant investigation. Mr. Dunham’s conviction at trial sends a strong message regarding the benefit of working across agency lines to protect the integrity of Government programs like the USDA Advanced Biofuel Payment Program, established in the 2008 Farm Bill as an incentive for companies to produce and use alternative fuel sources. The USDA Office of Inspector General will continue to dedicate resources to protect the Department’s programs and assets by investigating those who commit fraud and compromise the integrity of USDA programs.”
The case was investigated by the Environmental Protection Agency’s Criminal Investigation Division, the Internal Revenue Service’s Criminal Investigation Division, and the United States Department of Agriculture’s Office of Inspector General. The case is being prosecuted by Assistant United States Attorney John Gallagher and Trial Attorney Adam Cullman of the ENRD.
Green Energy Fraudster Convicted at Trial for Scamming Multiple Federal Agencies and his CustomersRead the Press Release
Assistant Attorney General Jeffrey Bossert Clark of the Department of Justice’s Environment and Natural Resources Division (ENRD) and United States Attorney William M. McSwain for the Eastern District of Pennsylvania announced today that a federal jury in Reading, Pennsylvania, convicted David M. Dunham Jr. of the following crimes: conspiracy to commit wire fraud and defraud the United States; wire fraud; filing false tax documents; and obstruction of justice. The conviction stemmed from Dunham hatching and executing a scheme to defraud the Environmental Protection Agency, the Internal Revenue Service, and his customers to obtain renewable fuel credits in his “green energy” business. The government is also seeking forfeiture of approximately $1.7 million in fraudulently obtained revenue and several parcels of real estate. The trial lasted four weeks before United States District Judge Jeffrey L. Schmehl.
In Dunham’s green energy scam, he fraudulently applied for, received, and sold “credits” for selling renewable biofuels that he, in fact, did not sell and, in many instances, had never possessed in the first place. He obtained these credits from government agencies, which resulted in Dunham obtaining $50 million in fraudulent revenue. Dunham ran the scam from approximately 2010 to 2015, using his business, Smarter Fuels, and that of his co-defendant, Ralph Tomasso, who previously pleaded guilty to conspiracy to defraud federal programs.
“Today’s conviction sends a clear message to any future fraudsters out there: crime does not pay. Especially when that crime involves defrauding American customers and multiple federal agencies,” said Assistant Attorney General Clark. “When the defendant knowingly cheated a federal government program aimed at energy conservation, he gave himself an unfair advantage over his competitors and stole millions of dollars from the American taxpayer in the process. The Department of Justice will not tolerate this type of deception and will continue to work with its law enforcement partners to root out this unlawful conduct.”
“Though this defendant tried to deflect blame on others, his years of scamming the government and his customers has finally caught up to him,” said U.S. Attorney McSwain. “And the truth is as simple as this: Everyone has to follow the rules. You cannot lie, steal, or cover up your misdeeds. If you do, we will hold you accountable. Experience shows that fraudsters like Dunham are always looking for the next best scam. As American consumers become increasingly more concerned with energy conservation, green energy scams like the one in this case provide criminals with an easy angle. We are grateful that the jury saw through Dunham’s lies and reached the correct result.”
“David Dunham created an elaborate scheme that served no purpose other than to mislead and defraud the government,” said IRS Special Agent in Charge Guy Ficco. “Unfortunately for him, our special agents were able to track the movement of paperwork and uncover the deceit behind his actions. We, along with our fellow law enforcement partners and the Department of Justice, will continue to investigate and prosecute those who commit similar crimes.”
“The defendant made numerous fraudulent claims to illegally profit from the Renewable Fuel Standard (RFS) Program,” said Director Jessica Taylor, Director of EPA’s Criminal Investigation Division. “Today’s conviction should send a clear signal that EPA and our law enforcement partners are committed to protecting the integrity of the Energy Independence and Security Act of 2007.”
“We appreciate the commitment of the Department of Justice and the cooperative efforts of our law enforcement partners throughout this significant investigation,” said USDA-OIG Special Agent-in-Charge Bethanne M. Dinkins. “Mr. Dunham’s conviction at trial sends a strong message regarding the benefit of working across agency lines to protect the integrity of Government programs like the USDA Advanced Biofuel Payment Program, established in the 2008 Farm Bill as an incentive for companies to produce and use alternative fuel sources. The USDA Office of Inspector General will continue to dedicate resources to protect the Department’s programs and assets by investigating those who commit fraud and compromise the integrity of USDA programs.”
The case was investigated by the Environmental Protection Agency’s Criminal Investigation Division, the Internal Revenue Service’s Criminal Investigation Division, and the United States Department of Agriculture’s Office of Inspector General. The case is being prosecuted by Trial Attorney Adam Cullman of the Environmental Crimes Section and Assistant United States Attorney John Gallagher.
Georgia Man Sentenced for Stealing from the Accounts of the Elderly andRead the Press Release
St. Louis – Omar Fandino, 25, of Suwanee, GA, was sentenced to 30 months in prison for cloning access devices of elderly victims to obtain cash and merchandise. He appeared in federal court today before U.S. District Judge Ronnie L. White who ordered Fandino to pay $29,551.42 in restitution.
According to court documents, Fandino traveled to the St. Louis area and rented a vehicle between September 23rd and October 3, 2016. He traveled throughout the area using access devices embedded with the account numbers of individuals to purchase merchandise, money orders, and gift cards and to initiate automated teller machine withdrawals. The account holders were between the ages of 59 and 86, and the final victim was a disabled person sharing an account with her 72-year-old mother.
The case was investigated by the Federal Bureau of Investigation. Assistant U.S. Attorney Tracy Berry is handling the case for the U.S. Attorney’s Office as part of the Department of Justice Elder Justice Initiative.
The Department of Justice Elder Justice Initiative is dedicated to investigating and prosecuting financial crimes targeting older adults. The Eastern District of Missouri Identity Theft Task Force is a group of federal, state and local law enforcement agencies working together to combat identity theft and its related crimes across the St. Louis Community.
Gas Marketer B. Charles Rogers Gas and Three Individuals Agree to Pay $4.375 Million to Resolve Royalty Fraud AllegationsRead the Press Release
Gas marketer B. Charles Rogers Gas Ltd. (BCR), which operated in the San Juan Basin area of New Mexico and southern Colorado, and its owners Billy Charles Rogers Jr. and Wynon Rogers, of Fort Worth, Texas, have agreed to pay $3.575 million to resolve False Claims Act (FCA) allegations that they caused reduced mineral royalty payments to the United States, the Department of Justice announced today. In addition, Thomas R. Lutner III, of Katy, Texas, who worked with BCR while employed as a gas supply manager at a natural gas distributor based in Houston, Texas, has agreed to pay $800,000 to resolve FCA allegations relating to his role in BCR’s alleged royalty fraud.
“The Department of Justice is committed to ensuring that those who remove valuable assets from public or Indian lands pay a fair price for those assets,” said Assistant Attorney General Jody Hunt, of the Department of Justice’s Civil Division. “We will continue to pursue claims against those who evade, or cause others to evade, their royalty obligations.”
“Businesses that underpay for our nation’s natural resources must be held to account,” said U.S. Attorney for the Northern District of Texas Erin Nealy Cox.
The United States alleged that, while operating as a gas marketer in the San Juan Basin, BCR, at the direction of Mr. and Mrs. Rogers and Mr. Lutner, issued to producers false transaction statements in connection with BCR’s gas purchases. Those transaction statements allegedly underreported the volume and value of the natural gas liquids that BCR purchased. The United States alleged that many of the producers had federal gas leases, and that BCR’s fraudulent conduct caused those producers to underpay royalties owed to the United States on gas removed from those leases. BCR, Mr. and Mrs. Rogers, and Mr. Lutner have admitted and accepted responsibility for making and using, or causing to be made and used, false records that were material to producers’ obligations to pay royalties to the United States.
“The Department of the Interior (DOI) Office of the Inspector General (OIG) is committed to working with the Department of Justice and the Office of Natural Resources Revenue to ensure that public oil and gas revenues are properly accounted for and collected on behalf of the American public and all mineral interest owners,” said Ron Gonzales, Special Agent in Charge of the DOI OIG Energy Investigations Unit.
The civil settlement was the result of a coordinated effort by the Justice Department’s Civil Division, Commercial Litigation Branch; the U.S. Attorney’s Office for the Northern District of Texas; and the DOI OIG.
Except to the extent of the facts admitted by the settling parties, the claims resolved by the settlement agreement are allegations only and there has been no determination of liability.
Four Members of the Violent “Murdaland Mafia Piru” Bloods Gang Convicted of Federal Racketeering and Drug Conspiracies and Related Charges after Six-Week TrialRead the Press Release
Defendants Committed Gun Violence in Northwest Baltimore City and Baltimore County, Including with Assault Rifle
Baltimore, Maryland – Late on April 30, 2019, a federal jury convicted the following four defendants for racketeering and drug trafficking conspiracies, as well as firearms and other related charges connected to their participation in the gang activities of Murdaland Mafia Piru (MMP), a subset of the Bloods gang:
Dante Bailey, a/k/a “Gutta,” “Almighty,” and “Wolf,” age 40, of Windsor Mill, Maryland; Jamal Lockley, a/k/a “T-Roy” and “Droid,” age 40, of Baltimore; Corloyd Anderson, a/k/a “Bo,” age 36, of Owings Mills, Maryland; and
Shakeen Davis, a/k/a “Creams,” age 24, of Baltimore.The jury convicted co-defendant Randy Banks, a/k/a “Dirt,” age 41, of Baltimore, of the drug trafficking conspiracy. He was found not guilty of the racketeering conspiracy.
The guilty verdicts were announced by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge Rob Cekada of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Baltimore Field Division; Commissioner Michael Harrison of the Baltimore Police Department; Chief Terrence B. Sheridan of the Baltimore County Police Department; Baltimore City State’s Attorney Marilyn J. Mosby; and Baltimore County State’s Attorney Scott Shellenberger.
“These gang members brought terror and death to Baltimore and Baltimore County neighborhoods with guns and drugs,” said U.S. Attorney Robert K. Hur. “Now they face up to life in federal prison, where there are no suspended sentences and no parole—ever. I urge anyone who’s thinking of following these defendants’ example: Please, put down the guns and save a life—maybe even your own.”
“The gun violence resulting from these gang turf wars and rivalries is tearing this city apart,” said ATF Baltimore Special Agent in Charge Rob Cekada. “We remain committed in our mission to identify, investigate, and incarcerate anyone using firearms to commit these violent crimes.”
According to the evidence presented at the six-week trial, MMP, also known as the “Mob” or “Mobsters,” is a violent subset of the Bloods gang that operates in Maryland and elsewhere. MMP was modeled after the Italian Mafia, and was organized hierarchically, with Dante Bailey as “the Don” at the top and various “Bosses,” “Underbosses,” “Capos,” “Lieutenants,” and “Mobsters” underneath. For many years, MMP controlled the drug trade in large swaths of Northwest Baltimore City and neighboring Baltimore County. The gang’s drug shop in the 5200 block of Windsor Mill Road was particularly lucrative due to its close proximity to Interstate 70, and it frequently attracted drug customers driving from Western Maryland and neighboring states. MMP’s members enriched themselves through drug trafficking and other criminal activities, and used violence and threats of violence to intimidate or retaliate against witnesses, protect the gang’s territories, enforce debts, and eliminate rivals.
According to trial testimony, one of the founding principles of the gang was a rule against cooperation with law enforcement. Violations of this rule were punishable by death. MMP members enhanced their status within the gang by carrying out acts of violence against rivals. For instance, members could earn a lightning bolt tattoo for “killing for the Mob.” Several MMP members, including Dante Bailey, have lightning bolt tattoos on their faces or bodies. MMP members used social media websites to assert the gang’s claim to particular drug territories, intimidate rival gangs and drug traffickers, enhance MMP’s status, and enhance members’ status within the gang. MMP members and associates posted photographs and rap videos to these social media websites in which they flaunted firearms and threatened to kill those who stood in the way of the gang. The evidence proved that members and associates of MMP participated in the gang’s affairs through a pattern of racketeering activities, including murder, extortion, witness tampering and retaliation, and drug distribution.
For example, on February 12, 2015, Dante Bailey murdered James Edwards for showing disloyalty to the gang. Bailey shot Edwards to death in the 300 block of Collins Avenue, using the same gun he had used to shoot at rivals in the 5200 block of Windsor Mill Road three nights earlier. On May 30, 2015, Shakeen Davis attempted to murder two rivals in the 5200 block of Windsor Mill Road, firing multiple rounds at them with an assault rifle in broad daylight at a busy intersection. In September 2017, while in pretrial custody, the gang’s leader, Dante Bailey, caused a letter to be mailed to a co-conspirator that directed the murder of a co-defendant who was cooperating with law enforcement. ATF Special Agents recovered the hit letter from the co-conspirator’s residence, as well as a recently purchased firearm.
The evidence proved that Randy Banks was part of the drug conspiracy, which began in at least 2011 and distributed narcotics, including heroin, crack cocaine, and powder cocaine.
Bailey faces a mandatory life sentence for murder in aid of racketeering. Lockley, Anderson, and Davis each face a maximum of life in prison for the racketeering and drug conspiracies. Lockley faces a mandatory minimum of 25 years in prison for the drug conspiracy. Anderson faces a mandatory minimum of 15 years in prison for possession of a firearm by a felon. Davis faces a mandatory minimum sentence of 10 years in prison for the drug conspiracy. Banks faces a maximum sentence of 20 years in prison for the drug conspiracy. U.S. District Judge Catherine C. Blake has not yet scheduled sentencing for the defendants.
Twenty co-defendants previously pleaded guilty to their roles in the conspiracies. The final defendant, Sydni Frazier, was part of this trial, but had a mistrial declared after his attorney could not continue due to health reasons. His new trial date has not yet been scheduled. He is the final defendant of the 26 indicted in the case.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of 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 the local community to develop effective, locally based strategies to reduce violent crime.
United States Attorney Robert K. Hur praised the ATF, the Baltimore City and Baltimore County Police Departments, and the Baltimore City and Baltimore County State’s Attorney’s Offices for their work in the investigation and prosecution. Mr. Hur thanked Assistant United States Attorneys Christina Hoffman and Lauren E. Perry, who are prosecuting this Organized Crime Drug Enforcement Task Force case.
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Fort Pierce Felon Sentenced to Prison for Unlawfully Possessing a Firearm and More Than Two Pounds of MarijuanaRead the Press Release
Jose Antonio Morales, 33, of Fort Pierce, was sentenced by U.S. District Judge Robin L. Rosenberg to a total of 84 months in prison today, after having been convicted at trial of being a felon unlawfully in possession of a firearm and possessing marijuana with the intent to distribute the controlled substance (Case No. 18-Cr-14056).
Ariana Fajardo Orshan, U.S. Attorney for the Southern District of Florida, Ari C. Shapira, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Miami Field Office and Ken J. Mascara, Sheriff, St. Lucie County Sheriff’s Office, made the announcement.
According to the court record, including evidence introduced during the trial in West Palm Beach, in June 2018, law enforcement seized two pounds of high-grade marijuana and a loaded firearm from a safe in Morales’ bedroom while executing a search warrant at his residence in Fort Pierce. When the search warrant was executed, Morales’ residence was occupied by five children. A toddler was sleeping within a few feet of the safe where the loaded firearm and two pounds of marijuana were discovered.
Morales is a convicted felon and was prohibited, by law, to possess a firearm and/or ammunition.
U.S. Attorney Fajardo Orshan commended the investigative efforts of the ATF and St. Lucie County Sheriff’s Office in this matter. The case was prosecuted by Assistant U.S. Attorneys Michael D. Porter and Marton Gyires.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or at http://pacer.flsd.uscourts.gov.
Former West Virginia Jail Internal Affairs Officers Charged with Civil Rights OffenseRead the Press Release
Austin Garland Burke, 64, and Timmy Allen Kemper, 58, were indicted today for the use of unlawful force on a pretrial detainee at the Western Regional Jail in Barboursville, West Virginia, while they were acting as internal affairs officers with the West Virginia Regional Jail and Correctional Facility Authority, announced Assistant Attorney General Eric Dreiband of the Department of Justice’s Civil Rights Division, U.S. Attorney for the Southern District of West Virginia Michael B. Stuart, and FBI Pittsburgh Division Special Agent in Charge Robert A. Jones.
Burke and Kemper are charged with one count of deprivation of rights under color of law. According to the indictment, on Feb. 27, 2015, Burke and Kemper were responsible for the use of unlawful force against the detainee, who was injured when a flashbang grenade and a stinger grenade were deployed in his cell and he was then hogtied and transported in a K-9 vehicle to another correctional facility. The indictment also alleges that the defendants’ acts involved the use of a dangerous weapon and resulted in bodily injury to the detainee.
The count carries a maximum penalty of 10 years of imprisonment. An indictment is merely an accusation and the defendant is presumed innocent unless proven guilty.
This case was investigated by the FBI Pittsburgh Division, Huntington, West Virginia Resident Agency. It is being prosecuted by Trial Attorneys Olimpia E. Michel and Kathryn E. Gilbert of the Department of Justice’s Civil Rights Division and Assistant United States Attorney Rachel Kincaid for the Southern District of West Virginia.
Former University Professor Pleads Guilty to Traveling to Missouri for Sex with a MinorRead the Press Release
KANSAS CITY, Mo. – A former Ohio university professor pleaded guilty in federal court today to traveling to Kansas City, Mo., to engage in sexual activity with a person whom he believed to be a 14-year-old girl.
Kevin Connor Armitage, 53, pleaded guilty before U.S. District Judge Brian C. Wimes to traveling across state lines to engage in illicit sexual conduct with a minor. Armitage was a professor of American studies at Miami University in Oxford, Ohio.
According to today’s plea agreement, Armitage maintained a profile on a website that allows registered members to exchange information regarding commercial sex activity. The website’s public posts contain detailed accounts of sexual encounters between members and commercial sex workers, including prices and specific locations for sexual encounters. Links to well-known sex trafficking websites were posted with reviews of sexual encounters. Members of the website are able to contact the posters by private message to obtain contact information for the commercial sex workers described in the posts.
Armitage was a senior member of the website, with 576 postings that detail his prior experiences with prostitutes in Ohio, Arizona, Kansas, Colorado, and Tijuana.
On May 22, 2018, an undercover federal agent responded to a discussion thread posted by Armitage. Armitage indicated that he would be visiting the Kansas City area and was interested in recommendations. Armitage was provided a phone number for a female FBI agent, who was posing as a 14-year-old female.
After several conversations, Armitage agreed to meet the 14-year-old’s cousin at a restaurant on the Country Club Plaza in Kansas City on May 30, 2018, in order to discuss payment. Once he arrived at the restaurant, Armitage was told, he would be given the address where he could meet the 14-year-old. An FBI undercover employee, posing as the cousin, met Armitage at the restaurant and he was arrested.
Under federal statutes, Armitage is subject to a sentence of up to 30 years in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Assistant U.S. Attorney Teresa A. Moore. It was investigated by the Department of Health and Human Services, Office of Inspector General and the FBI.
Project Safe Childhood
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc . For more information about Internet safety education, please visit www.usdoj.gov/psc and click on the tab "resources."Former U.S. Army Employee at Picatinny Arsenal Sentenced to Five Years in Prison for Receiving Bribes and Directing KickbacksRead the Press Release
NEWARK, N.J. – A Pennsylvania man was sentenced today to 60 months in prison for using his position as an employee of the U.S. Army Contracting Command New Jersey (ACC-NJ) in connection with his role in two conspiracies in construction projects at Picatinny Arsenal (PICA) and Joint Base McGuire-Dix Lakehurst (Ft. Dix), U.S. Attorney Craig Carpenito announced.
Kevin Leondi, 58, of Stroudsberg, Pennsylvania, previously pleaded guilty before U.S. District Judge Susan D. Wigenton to Counts One and Two of a superseding indictment charging him with conspiring to defraud the United States by soliciting and accepting bribes, and conspiring to steer kickbacks from one conspirator to another. Judge Wigenton imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
Leondi represented the Army in renovation projects at PICA and Ft. Dix. A company referred to in the indictment as “Construction Company No. 1” served as a Job Order Contractor, also known as a “prime contractor,” for construction projects at PICA and Fort Dix. James Conway was employed by Construction Company No. 1 as a regional project manager of large-scale projects at PICA and Ft. Dix. George Grassie ran a construction, excavating and landscaping business in Pennsylvania that did subcontracting work at the bases.
From December 2010 through August 2015, Leondi solicited and accepted more than $150,000 in bribes from Grassie and others in return for task orders and other favorable assistance at the bases, and for not denying them future work. Leondi and the conspirators would disguise the bribes in the form of facially legitimate transactions, with Leondi buying vehicles and equipment from the conspirators at cut-rate prices or selling them equipment at inflated prices. In another instance, Leondi had Grassie absorb the costs that another contractor incurred in renovating property that Leondi owned in East Stroudsburg, Pennsylvania.
Leondi also admitted that he conspired to steer at least $48,000 in corporate kickbacks from Grassie to Conway to improperly obtain and reward Conway for his giving subcontracts and other favorable assistance to Grassie relating to Conway’s employer’s contracts with the federal government at PICA and Ft. Dix. The kickbacks included cash payments to help Conway pay his mortgage as well as free construction work at Conway’s home in Pennsylvania.
Grassie pleaded guilty in February 2017 to one count of conspiracy and one count of providing unlawful kickbacks for his role in the bribery and kickback conspiracies. Conway pleaded guilty to accepting unlawful kickbacks and a wire fraud charge involving other fraudulent conduct in August 2016. Both defendants are awaiting sentencing.
In addition to the prison term, Judge Wigenton sentenced Leondi to three years of supervised release and fined him $25,000.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie; the U.S. Department of Defense, Defense Criminal Investigative Service, under the direction of Special Agent in Charge Leigh-Alistair Barzey; and the U.S. Army, Major Procurement Fraud Unit, Criminal Investigation Command, under the direction of Special Agent in Charge Larry Scott Moreland, with the investigation leading to today’s sentencing.
The government is represented by Senior Trial Counsel Leslie Faye Schwartz and Senior Trial Counsel Mark J. McCarren, of the U.S. Attorney’s Office’s Special Prosecutions Division.
Former CIA Officer Pleads Guilty to Conspiracy to Commit EspionageRead the Press Release
ALEXANDRIA, Va. – A former Central Intelligence Agency (CIA) case officer pleaded guilty today to conspiring to communicate, deliver and transmit national defense information to the People’s Republic of China.
“Those Americans entrusted with our government’s most closely held secrets have a tremendous responsibility to safeguard that information,” said G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia. “Instead of embracing that responsibility and honoring his commitment to not disclose national defense information, Lee sold out his country, conspired to become a spy for a foreign government, and then repeatedly lied to investigators about his conduct. This prosecution should serve as a warning to others who would compromise our nation’s secrets and betray our country’s trust. My thanks to the prosecutors, agents and our intelligence community partners for their terrific work on this important case.”
According to court documents, Jerry Chun Shing Lee, 54, left the CIA in 2007 and began residing in Hong Kong. In April 2010, two Chinese intelligence officers (IOs) approached Lee and offered to pay him for national defense information he had acquired as a CIA case officer. The IOs also told Lee they had prepared for him a gift of $100,000 cash, and they offered to take care of him “for life” in exchange for his cooperation.
Beginning sometime in May 2010 and continuing into at least 2011, Lee received requests for information, or taskings, from the Chinese IOs. The majority of the taskings asked Lee to reveal sensitive information about the CIA, including national defense information. On May 14, 2010, Lee made or caused to be made a cash deposit of $138,000 HKD (approximately $17,468 in USD) into his personal bank account in Hong Kong. This would be the first of hundreds of thousands of dollars (USD equivalent) in cash deposits Lee made or caused to be made into his personal HSBC account from May 2010 through December 2013.
“This is the third case in less than a year in which a former US intelligence officer has pled or been found guilty of conspiring with Chinese intelligence services to pass them national defense information,” said Assistant Attorney General Demers. “Every one of these cases is a tragic betrayal of country and colleagues. The National Security Division will continue to prosecute individuals like Lee who abuse their former access to classified information for financial gain while threatening the security of America. Many thanks to the agents, analysts and prosecutors whose work led to today’s outcome.”
On May 26, 2010, Lee created on his laptop computer a document that described, among other things, certain locations to which the CIA would assign officers with certain identified experience, as well as the particular location and timeframe of a sensitive CIA operation. After Lee created this document, he transferred it from his laptop to a thumb drive. The document included national defense information of the United States that was classified at the Secret level.
In August 2012, the FBI conducted a court-authorized search of a hotel room in Honolulu, Hawaii registered in Lee’s name. The search revealed that Lee possessed the thumb drive within his personal luggage. The FBI forensically imaged the thumb drive and later located the document in the unallocated space of the thumb drive, meaning that it had been deleted. The search also revealed that Lee possessed a day planner and an address book that contained handwritten notes made by Lee that mostly related to his work as a CIA case officer prior to 2004. These notes included, among other things, intelligence provided by CIA assets, true names of assets, operational meeting locations and phone numbers, and information about covert facilities.
“Today’s guilty plea is an example of how the FBI and the Department of Justice successfully pursue threats to our nation’s security and intelligence,” said Nancy McNamara, Assistant Director in Charge of the FBI's Washington Field Office. “U.S. Government employees are entrusted by the American people to keep our country safe and secure from adversaries. The targeting of former U.S. security clearance holders by Chinese intelligence services is a constant threat we face, and the FBI will continue to combat these threats and guard our nation against those who conspire to compromise our national security. I would like to thank the hardworking people of the FBI who work each day to defend our security and intelligence.”
During 2012, Lee had a series of interviews with the CIA. Throughout these interviews, in response to questions about what the IOs had wanted from him, Lee intentionally failed to disclose that he had received taskings from them. In May 2013, the FBI conducted three interviews with Lee. During one of those interviews, Lee admitted that he had received taskings but stated that he had not kept the written requests because they would tend to incriminate him.
“Today, Mr. Lee accepts responsibility not only for his crimes but also for their dangerous ramifications,” said John Brown, Assistant Director for Counterintelligence for FBI. “By knowingly aiding a foreign government, Mr. Lee put our country’s national security at serious risk and also threatened the safety and personal security of innocent people, namely his former intelligence colleagues. He deserves to answer for his treachery and he will do so as a result of the dedication of the FBI’s Counterintelligence Division, the Washington Field Office, and the Department of Justice in pursuing this case.”
The FBI interviewers also confronted Lee with the sensitive document discovered on the thumb drive. Lee falsely denied that he possessed it, claimed not to know who created it, and denied knowing why it would have been on his computer. He also denied deleting the document. Approximately one week later, in another FBI interview, Lee admitted that he created the document in response to two taskings from the IOs and transferred it to a thumb drive. He also said he thought about giving it to the IOs but never did.
In a January 2018 interview with the FBI, Lee falsely denied that he ever kept any work-related notes at home. When shown a photocopy of the front covers of the day planner and address book described above, as well as a copy of his handwriting therein, Lee falsely denied that he possessed the notebooks while transiting through Hawaii in August 2012. Lee also falsely denied that either of the books contained notes from asset meetings but conceded that any such notes would be classified. Further, Lee falsely denied that he ever put the sensitive document on a thumb drive, notwithstanding the fact that he had admitted having done so when interviewed by FBI agents in May 2013. Finally, Lee also falsely told the interviewing agents that in drafting this document he was writing down things “more [like] a diary thing,” notwithstanding the fact that in May 2013 he had told FBI agents that he had created the document in response to two taskings from the Chinese IOs.
Lee pleaded guilty to conspiracy to deliver national defense information to aid a foreign government and faces a maximum penalty of life in prison when sentenced on August 23. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, John C. Demers, Assistant Attorney General for National Security, and Nancy McNamara, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after Senior U.S. District Judge T.S. Ellis III accepted the plea. Assistant U.S. Attorney Neil Hammerstrom and Trial Attorneys Patrick T. Murphy and Adam L. Small of the National Security Division’s Counterintelligence and Export Control Section are prosecuting the case with assistance from Assistant U.S. Attorney Inayat Delawala.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-cr-89.
Former CIA Officer Pleads Guilty to Conspiracy to Commit EspionageRead the Press Release
A former Central Intelligence Agency (CIA) case officer pleaded guilty today to conspiring to communicate, deliver and transmit national defense information to the People’s Republic of China. Assistant Attorney General for National Security John C. Demers, U.S. Attorney G. Zachary Terwilliger for the Eastern District of Virginia, Assistant Director for Counterintelligence John Brown of the FBI and Assistant Director in Charge Nancy McNamara of the FBI’s Washington Field Office made the announcement after Senior U.S. District Judge T.S. Ellis III accepted the plea.
According to court documents, Jerry Chun Shing Lee, 54, left the CIA in 2007 and began residing in Hong Kong. In April 2010, two Chinese intelligence officers (IOs) approached Lee and offered to pay him for national defense information he had acquired as a CIA case officer. The IOs also told Lee they had prepared for him a gift of $100,000 cash, and they offered to take care of him “for life” in exchange for his cooperation.
Beginning sometime in May 2010 and continuing into at least 2011, Lee received requests for information, or taskings, from the Chinese IOs. The majority of the taskings asked Lee to reveal sensitive information about the CIA, including national defense information. On May 14, 2010, Lee made or caused to be made a cash deposit of $138,000 HKD (approximately $17,468 in USD) into his personal bank account in Hong Kong. This would be the first of hundreds of thousands of dollars (USD equivalent) in cash deposits Lee made or caused to be made into his personal HSBC account from May 2010 through December 2013.
“This is the third case in less than a year in which a former US intelligence officer has pled or been found guilty of conspiring with Chinese intelligence services to pass them national defense information,” said Assistant Attorney General Demers. “Every one of these cases is a tragic betrayal of country and colleagues. The National Security Division will continue to prosecute individuals like Lee who abuse their former access to classified information for financial gain while threatening the security of America. Many thanks to the agents, analysts and prosecutors whose work led to today’s outcome.”
“Those Americans entrusted with our government’s most closely held secrets have a tremendous responsibility to safeguard that information,” said U.S. Attorney Terwilliger. “Instead of embracing that responsibility and honoring his commitment to not disclose national defense information, Lee sold out his country, conspired to become a spy for a foreign government, and then repeatedly lied to investigators about his conduct. This prosecution should serve as a warning to others who would compromise our nation’s secrets and betray our country’s trust. My thanks to the prosecutors, agents and our intelligence community partners for their terrific work on this important case.”
“Today, Mr. Lee accepts responsibility not only for his crimes but also for their dangerous ramifications” said Assistant Director Brown. “By knowingly aiding a foreign government, Mr. Lee put our country’s national security at serious risk and also threatened the safety and personal security of innocent people, namely his former intelligence colleagues. He deserves to answer for his treachery and he will do so as a result of the dedication of the FBI’s Counterintelligence Division, the Washington Field Office, and the Department of Justice in pursuing this case.”
“Today's guilty plea is an example of how the FBI and the Department of Justice successfully pursue threats to our nation's security and intelligence,” said Assistant Director McNamara. “U.S. Government employees are entrusted by the American people to keep our country safe and secure from adversaries. The targeting of former U.S. security clearance holders by Chinese intelligence services is a constant threat we face, and the FBI will continue to combat these threats and guard our nation against those who conspire to compromise our national security. I would like to thank the hardworking people of the FBI who work each day to defend our security and intelligence.”
On May 26, 2010, Lee created on his laptop computer a document that described, among other things, certain locations to which the CIA would assign officers with certain identified experience, as well as the particular location and timeframe of a sensitive CIA operation. After Lee created this document, he transferred it from his laptop to a thumb drive. The document included national defense information of the United States that was classified at the Secret level.
In August 2012, the FBI conducted a court-authorized search of a hotel room in Honolulu, Hawaii registered in Lee’s name. The search revealed that Lee possessed the thumb drive within his personal luggage. The FBI forensically imaged the thumb drive and later located the document in the unallocated space of the thumb drive, meaning that it had been deleted. The search also revealed that Lee possessed a day planner and an address book that contained handwritten notes made by Lee that related to his work as a CIA case officer prior to 2004. These notes included, among other things, intelligence provided by CIA assets, true names of assets, operational meeting locations and phone numbers, and information about covert facilities.
During 2012, Lee had a series of interviews with the CIA. Throughout these interviews, in response to questions about what the IOs had wanted from him, Lee intentionally failed to disclose that he had received taskings from them. In May 2013, the FBI conducted three interviews with Lee. During one of those interviews, Lee admitted that he had received taskings but stated that he had not kept the written requests because they would tend to incriminate him.
The FBI interviewers also confronted Lee with the sensitive document discovered on the thumb drive. Lee falsely denied that he possessed it, claimed not to know who created it, and denied knowing why it would have been on his computer. He also denied deleting the document. Approximately one week later, in another FBI interview, Lee admitted that he created the document in response to two taskings from the IOs and transferred it to a thumb drive. He also said he thought about giving it to the IOs but never did.
In a January 2018 interview with the FBI, Lee falsely denied that he ever kept any work-related notes at home. When shown a photocopy of the front covers of the day planner and address book described above, as well as a copy of his handwriting therein, Lee falsely denied that he possessed the notebooks while transiting through Hawaii in August 2012. Lee also falsely denied that either of the books contained notes from asset meetings but conceded that any such notes would be classified. Further, Lee falsely denied that he ever put the sensitive document on a thumb drive, notwithstanding the fact that he had admitted having done so when interviewed by FBI agents in May 2013. Finally, Lee also falsely told the interviewing agents that in drafting this document he was writing down things “more [like] a diary thing,” notwithstanding the fact that in May 2013 he had told FBI agents that he had created the document in response to two taskings from the Chinese IOs.
Lee pleaded guilty to conspiracy to deliver national defense information to aid a foreign government and faces a maximum penalty of life in prison when sentenced on Aug. 23, 2019. 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.
Assistant U.S. Attorney Neil Hammerstrom and Trial Attorneys Patrick T. Murphy and Adam L. Small of the National Security Division’s Counterintelligence and Export Control Section are prosecuting the case, with assistance from Assistant U.S. Attorney Inayat Delawala.
Federal Grand Jury Indicts Tuscaloosa Man Previously Convicted of Felony MurderRead the Press Release
BIRMINGHAM – A federal grand jury indicted a Tuscaloosa man for being a felon in possession of a firearm announced U.S. Attorney Jay E. Town and ATF Special Agent in Charge Marcus Watson.
A one-count indictment filed in U.S. District Court charges MONTEZ VANTERUS SPRADLEY, 36, with felon in possession of a firearm. The firearm was seized by the Tuscaloosa Police Department after responding to a domestic disturbance at an apartment on March 26, 2019. Spradley is prohibited from possessing firearms because he has prior state court convictions in Jefferson County for felony murder, intimidating a witness, unlawful possession of a controlled substance with the intent to distribute, unlawful possession of a controlled substance, and second degree assault.
“Individuals with felony convictions, especially those involving violence and drugs, will answer to federal charges if they are caught with firearms,” Town said. “The U.S. Attorney’s Office appreciates the thorough investigation by the Tuscaloosa patrol officers at the scene and the ATF Task Force Officer’s quick preparation of this case for a federal charge. Criminals should be aware that every level of law enforcement is working together to get them off of the streets...and it’s working!”
“ATF’s Crime Gun Intelligence Centers are the driving force to reduce the violent crime that plagues our neighborhoods,” Watson said. “This indictment illustrates the effective partnerships with law enforcement and the community.”
If convicted, Spradley qualifies as an armed career criminal and will face a mandatory minimum sentence of 15 years in prison.
ATF investigated the case, which Assistant United States Attorney Alan Baty is prosecuting.
An indictment contains only charges. A defendant is presumed innocent unless and until proven guilty.
East Bridgewater Man Pleads Guilty to Fentanyl ConspiracyRead the Press Release
BOSTON – An East Bridgewater man pleaded guilty today in federal court in Boston in connection with fentanyl trafficking.
Joshua Siereveld, 38, pleaded guilty to conspiracy to distribute and possess with the intent to distribute 400 grams or more of fentanyl, and possession with intent to distribute 40 grams or more of fentanyl. U.S. Senior District Court Judge Geoerge A. O’Toole Jr. scheduled sentencing for Sept. 16, 2019. Siereveld has been in custody since his arrest in March 2018.
From December 2017 through January 2018, investigators intercepted hundreds of communications between Siereveld and his source of supply in Lawrence. Over the course of two months, Siereveld purchased over a kilogram and a half of fentanyl, assisted by co-defendant Justin Brunick, 29, of Rockland, who served as a courier for several transactions. After a fentanyl pickup on March 14, 2018, investigators stopped Siereveld, seized approximately 130 grams of fentanyl, and arrested him.
Brunick pleaded guilty to his role in the fentanyl conspiracy on April 19, 2019; his sentencing is scheduled for July 17, 2019.
The charge of conspiracy for over 400 grams of fentanyl provides for a mandatory minimum sentence of 10 years and up to life in prison, a minimum of five years and up to a lifetime of supervised release, and a fine of up to $10 million. The charge of possession with intent to distribute and distribution of 40 grams or more of fentanyl provides for a sentence of no greater than 40 years in prison, a minimum of four years and up to a lifetime of supervised release, and a fine of up to $8 million. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling; Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration, New England Field Division; East Bridgewater Police Chief Scott Allen; and Pembroke Police Chief Richard D. Wall made the announcement today. Assistant U.S. Attorney Lauren A. Graber of Lelling’s Narcotics and Money Laundering Unit is prosecuting the case.
Dominican National Pleads Guilty to Illegally Reentering U.S.Read the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that OLIVER JOAN UBIERA MALENO, 36, a citizen of the Dominican Republic last residing in Danbury, pleaded guilty today before U.S. District Judge Victor A. Bolden in Bridgeport to illegal reentry by a removed alien.
According to court documents and statements made in court, in July 2002, Ubiera Maleno, who at the time was a lawful permanent resident of the U.S., was sentenced in federal court in Alaska to 37 months of imprisonment for possessing with intent to distribute a controlled substance. In December 2003, he was sentenced in state court in Harris County, Texas, to 15 years of imprisonment for possessing with intent to deliver 400 grams or more cocaine. Ubiera Maleno was removed to the Dominican Republic in August 2009 after he had served the federal sentence and a portion of the Texas sentence.
On April 19, 2018, the Danbury Police Department arrested Ubiera Maleno for drug distribution offenses. He has been detained since his arrest, and the state charges are pending.
The charge of illegal reentry carries a maximum term of imprisonment of 20 years. A sentencing date is not scheduled.
This matter is being investigated by the U.S. Department of Homeland Security, Immigration and Customs Enforcement (ICE), Enforcement and Removal Operations. The case is being prosecuted by Assistant U.S. Attorney Hal Chen.
Dominican National Pleads Guilty to Heroin ConspiracyRead the Press Release
BOSTON – A Dominican national pleaded guilty today in federal court in Springfield in connection with his role in a large-scale drug conspiracy that trafficked dozens of kilos of heroin and fentanyl into Springfield from Bronx, N.Y., and the Dominican Republic.
Jose Miguel Ramos, 39, pleaded guilty to one count of conspiring to distribute and possession with intent to distribute more than one kilogram of heroin. U.S. District Court Judge Mark G. Mastroianni scheduled sentencing for Aug. 1, 2019.
Ramos lived in a heroin mill in Springfield where he and others packaged kilograms of heroin for retail distribution for a drug trafficking organization (DTO) based in Springfield, which was allegedly run by Alberto Marte. The investigation revealed that in approximately April of 2016, Marte paid approximately $20,000 to smuggle Ramos into the country so that Ramos could work for Marte’s DTO in Springfield. When law enforcement executed federal search warrants related to the investigation in September 2016, they recovered approximately $140,000 in cash and over six kilograms of heroin.
The charge of conspiracy to distribute more than one kilogram of heroin provides for a mandatory minimum sentence of 10 years in prison, a minimum of five years of supervised release and a fine of up to $10 million. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling; Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration’s New England Division; Peter C. Fitzhugh, Special Agent in Charge of Homeland Security Investigations in Boston; Hampden County District Attorney Anthony D. Gulluni; Colonel Kerry A. Gilpin, Superintendent of the Massachusetts State Police; Acting Springfield Police Commissioner Cheryl Clapprood; Chicopee Police Chief William Jebb; Holyoke Police Chief Manny Febo; and West Springfield Police Chief Ronald Campurciani made the announcement today. Assistant U.S. Attorney Neil Desroches of Lelling’s Springfield Branch Office is prosecuting the case.
The details contained in the charging documents are allegations. The remaining defendants are presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Court Authorizes Service of John Doe Summonses Seeking Information About Finnish Residents Using Bank of America, Charles Schwab, and TD Bank Payment Cards Linked to Non-Finnish Bank AccountsRead the Press Release
A federal court in North Carolina authorized the Internal Revenue Service (IRS) to serve John Doe summonses on Bank of America, Charles Schwab, and TD Bank in an order that was unsealed yesterday, the Justice Department announced. The John Doe summonses seek information about persons residing in Finland that have Bank of America, Charles Schwab, or TD Bank payment cards linked to bank accounts located outside of Finland. The summonses are referred to as “John Doe” summonses because the IRS does not know the identity of the persons being investigated.
“The Department of Justice and the IRS are committed to working with the United States’ international treaty partners to identify and stop individuals using hidden offshore accounts to evade tax laws,” said Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division. “The United States does not tolerate offshore tax evasion, nor does it sanction tax evasion committed through U.S. financial institutions.”
“Our continued success in combatting offshore tax noncompliance has been helped by the assistance we receive through the network of tax treaties around the globe,” said IRS Commissioner Charles Rettig. “Yesterday’s effort reflects that the U.S. will return this help by working under the law with tax administrators in other nations to help them in their fight against tax evasion and avoidance. A global economy should not be allowed to serve as a possible vehicle for tax evasion in any country.”
The United States petitioned the United States District Court for the Western District of North Carolina to authorize the summons at the request of the government of Finland under the tax treaty between Finland and the United States. That treaty allows the two countries to cooperate in exchanging information that is necessary for carrying out each country’s tax laws. The IRS summons seeks the identities of Finnish residents who have payment cards linked to bank accounts located outside of Finland so that the Finnish government can determine if those persons have complied with Finnish tax laws. Finland has advised the IRS that, in circumstances where the payment cards are used only at ATMs or in other transactions where authorization is by PIN code, and the cardholder need not identify himself or herself to the merchant, the cardholders cannot be identified from sources in Finland.
The filing does not allege that Bank of America, Charles Schwab, or TD Bank violated any U.S. or Finnish laws with respect to these accounts.
As described in the petition and supporting documents filed by the United States, the request is part of a foreign payment project being conducted by the Finnish Tax Administration (FTA), in which information on the use of payment cards issued by foreign financial institutions is used to identify non‑compliant Finnish taxpayers. Earlier FTA investigations of approximately 120 to 150 Finnish taxpayers who used foreign payment cards in a similar manner have yielded extremely high rates of tax non-compliance, as noted in the United States’ memo in support of the petition, which indicates that it is likely that the John Does sought by the summons are Finnish residents who are failing to report these foreign accounts and associated income.
The court order in this case authorizing this enforcement action is part of ongoing international efforts by the United States and its treaty partners to stop persons from using foreign financial accounts to evade taxes. Courts have previously approved John Doe summonses allowing the IRS to identify individuals using offshore accounts to evade their U.S. obligations, and have also approved John Doe summonses to be used to identify individuals using U.S. financial institutions or accounts to evade foreign tax obligations.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Corrections Officer Pleads Guilty to Scheme to Smuggle Opioids into MCI-NorfolkRead the Press Release
BOSTON – A former corrections officer at the Massachusetts Correctional Institute facility in Norfolk (MCI-Norfolk) pleaded guilty today in federal court in Boston in connection with a conspiracy to smuggle Suboxone strips into the facility for an inmate.
Steven J. Frazer, 29, of Cumberland, R.I., pleaded guilty to an Information charging him with one count of conspiracy to possess a controlled substance with intent to distribute. U.S. Senior District Court Judge George A. O’Toole Jr. scheduled sentencing for Sept. 16, 2019. In November 2018, Frazer was charged by criminal complaint and arrested.
Beginning around Nov. 14, 2018, Frazer, who was working as a corrections officer, arranged with a cooperating witness to smuggle Suboxone strips into MCI-Norfolk to sell to inmates. Suboxone is a Class III controlled substance used to treat heroin addiction, but some people abuse it to get high. It is coveted as contraband in prisons across the nation and particularly in New England.
Around midnight on Sunday, Nov. 18, 2018, the cooperating witness met Frazer in a South Attleboro parking lot and provided him with 40 Suboxone strips, 24 pages of K2 (a synthetic cannabinoid, which is more powerful and more dangerous than marijuana), and $2,500 in cash. After the meeting – which was audio and video recorded by law enforcement – federal agents arrested Frazer.
The charge of conspiracy to possess a controlled substance with intent to distribute provides for a sentence of no greater than 10 years in prison, three years of supervised release, a fine of $500,000 and restitution. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and Commissioner Carol A. Mici III of the Massachusetts Department of Correction made the announcement today. Assistant U.S. Attorney Eugenia M. Carris of Lelling’s Public Corruption and Special Prosecutions Unit is prosecuting the case.
Convicted Felon Sentenced to Federal Prison for Possessing a GunRead the Press Release
A two-time felon was sentenced to more than five years in federal prison today.
Roque Moreno, age 38, from Sioux City, Iowa, received the prison term after an November 19, 2018, guilty plea to one count of possession of a firearm by a prohibited person.
Evidence produced by the United States at the change of plea and sentencing hearings revealed Moreno had two prior felony convictions, and had used guns to threaten people on two occasions, once dry firing the weapon to scare an individual and on another occasion actually firing the weapon into the ground. Additionally, his criminal history revealed a history of dangerousness including five assault convictions, negligent child abuse, interference with official acts, Operating While Intoxicated, and other offenses.
Moreno was sentenced in Sioux City by Chief United States District Court Judge Leonard T. Strand. Moreno was sentenced to 70 months’ imprisonment. He must also serve a 3-year term of supervised release after the prison term. There is no parole in the federal system. Moreno is being held in the United States Marshal’s custody until he can be transported to a federal prison.
This case was brought as part of the Project Safe Neighborhoods (PSN). PSN is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violence crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violence offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
The case was investigated by the Sioux City, Iowa Police Department and prosecuted by Assistant United States Attorney Forde Fairchild.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 18-CR-04068.
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Columbia Man Sentenced to over 5 Years on Federal Drug and Firearm ChargesRead the Press Release
Columbia, South Carolina --- United States Attorney Sherri A. Lydon announced today that Reggie Denard Goodwin, age 47, of Columbia, South Carolina, was sentenced to over 5 years in federal prison after pleading guilty to possession with intent to distribute cocaine and crack cocaine and to being a felon in possession of a firearm and ammunition.
Evidence presented to the court showed that on March 13, 2018, deputies with the Richland County Sheriff’s Department stopped Goodwin’s vehicle after observing a traffic violation. Deputies smelled marijuana and asked Goodwin, the driver, to exit the vehicle. Goodwin actively resisted arrest, struck the officer’s arm, and tried to flee. A loaded .380 caliber handgun, which was later determined to be stolen, was found in Goodwin’s pocket. Inside the car, deputies located a digital scale and baggies of cocaine, crack cocaine, and marijuana. After waiving his rights, Goodwin admitted that he tried to run because he had drugs and a gun. Goodwin was arrested on state charges and released on state bond.
Three months later, while out on that state bond from the March 2018 drug and gun offenses, Goodwin was involved in a high speed chase on June 1, 2018, after Richland County Sheriff’s Department deputies attempted to stop his truck for a traffic violation. The chase ensued through highly populated areas of Columbia, including Devine Street and Garners Ferry Road. During the chase, a deputy observed Goodwin throwing baggies out of his truck. Goodwin lost control and wrecked his truck as he crossed into oncoming traffic over a raised median at the on-ramp to I-77. Goodwin exited the truck with a handgun in his hands, which he tossed into the brush when he attempted to flee. Goodwin resisted arrest and struggled with deputies. He was arrested on state charges and released again on state bond. Thereafter, a federal complaint and arrest warrant were issued. Goodwin was arrested and remains in federal custody.
Federal law prohibits Goodwin from possessing firearms and ammunition based upon prior state convictions for possession of cocaine and possession of crack cocaine (1990); burglary 2nd degree (1990); grand larceny (1991); receiving stolen goods (1994); forgery (1996); burglary 2nd degree/strong arm robbery, possession of crack cocaine, and grand larceny (1996); burglary 2nd degree and grand larceny (1996); possession with intent to distribute marijuana (2006); and possession of crack cocaine (2006).
Senior United States District Judge Joseph F. Anderson, Jr., sentenced Goodwin to 63 months in federal prison, to be followed by a 6-year term of court-ordered supervision. There is no parole in the federal system.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the Richland County Sheriff’s Department. It was prosecuted as part of the joint federal, state, and local Project CeaseFire initiative, which aggressively prosecutes firearm cases. Project CeaseFire is South Carolina’s implementation 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. Assistant United States Attorney Stacey D. Haynes of the Columbia office prosecuted the case.
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Colombian National Sentenced for Illegal ReentryRead the Press Release
BOSTON – A Colombian national was sentenced today in federal court in Boston for illegally reentering the United States after deportation
Hector Mejia Mejia, a/k/a Hector Giraldo Mejia, 33, was sentenced by U.S. Senior District Court Judge Douglas P. Woodlock to two years in prison and three years of supervised release. His sentence is to be served consecutive to a state sentence he is currently serving for cocaine trafficking. In February 2019, Mejia Mejia pleaded guilty to one count of illegal reentry of a deported alien.
Mejia Mejia has been deported from the United States on four prior occasions between 2008 and 2011, and has two prior federal convictions for illegal reentry: in 2009 out of the District of New Mexico, and one in 2010 out of the Southern District of Texas. Sometime after his last deportation, Mejia Mejia illegally reentered the United States.
United States Attorney Andrew E. Lelling and Todd Lyons, Acting Field Office Director, Boston, U.S. Immigration and Customs Enforcement’s Enforcement and Removal Operations, made the announcement today. Assistant U.S. Attorney Suzanne Sullivan Jacobus of Lelling’s Major Crimes Unit prosecuted the case.
Child Sexual Predator Sentenced to 140 Years in Prison for Sexual Exploitation of ChildrenRead the Press Release
LAS VEGAS, Nev. – A Las Vegas man convicted of sexually exploiting children by producing child pornography and possessing hundreds of images and videos of child pornography, was sentenced today to 140 years in federal prison, announced U.S. Attorney Nicholas A. Trutanich for the District of Nevada and Special Agent in Charge Aaron C. Rouse for the FBI’s Las Vegas Division.
“Today’s sentence sends a strong message that we will hold child sexual predators accountable and bring them to justice,” said U.S. Attorney Trutanich. “Through our Project Safe Childhood initiative, in collaboration with local and federal partners, we will prosecute individuals who prey on our children and commit heinous and violent acts against them.”
A jury convicted Lonny Joseph DiTirro, 37, of four counts of sexual exploitation of children by producing child pornography and one count of possession of child pornography. United States District Judge Kent J. Dawson presided over the jury trial and sentencing hearing. After being released from custody, under the Sexual Offender Registration Notification Act (SORNA), DiTirro will be required to register as a sex offender.
According to court documents and evidence presented during the three-day jury trial, on September 10, 2015, the Las Vegas Metropolitan Police Department received a concerned citizen’s report of possible child pornography found on a SD card belonging to DiTirro. Law enforcement obtained and executed a search warrant for the SD card. A forensic examination of the SD card found 254 images and 42 videos of child pornography, depictions that included infants and toddlers being sadistically and violently sexually assaulted.
Additionally, DiTirro had organized and catalogued dozens of folders titled with the name and age of nearly 50 girls from multiple states. The folders contained nude photos and videos of the girls, including videos of DiTirro raping several girls. Law enforcement identified several victims who all testified that they met DiTirro on a social media dating application when they were under the age of 16. The victims further testified that DiTirro lied about his age, claiming he was a teenager or in his early 20s, and went as far as falsifying his birth certificate in an effort to coerce, entice, and induce the victims into various sexual activities. DiTirro recorded sex acts with the minor victims, and he also created screenshots of sexually explicit video chats of the victims.
The case was investigated by the FBI and the Las Vegas Metropolitan Police Department. Assistant U.S. Attorneys Elham Roohani and Christopher Burton 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 U.S. Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood and for information about internet safety education, please visit www.justice.gov/psc.
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Brookings Man Found Guilty of Wire FraudRead the Press Release
United States Attorney Ron Parsons announced that Timothy Burns, age 50, of Brookings, South Dakota, was found guilty of five counts of wire fraud as a result of a five-day federal jury trial in Sioux Falls, South Dakota.
Each charge carries a maximum penalty of 20 years in federal prison and/or a $250,000 fine, 3 years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Burns and co-defendant Tobias Ritesman were indicted by a federal grand jury on January 9, 2018, after an extensive investigation by the Federal Bureau of Investigation.
Ritesman started a company called Ritesman Enterprises, Inc. in approximately 2012. Ritesman had three companies that operated under its umbrella: Tinkers and Thinkers, Tiger Consulting, and Global Aquaponics, Inc. In approximately June 2016, Ritesman formed SD Food Security, LLC.
Burns owned and operated multiple businesses in the Brookings area: Oakwood Equity Group, LLC, Concrete Contractors, Inc., and Multiply, LLC, d/b/a CF Promo, CF Gear, and I-29 Sports. Burns held these companies under a parent company called Syntech, Inc.
Ritesman purportedly sought to build an aquaponics facility in Brookings. The purpose of this facility would be to raise fish and produce. Global Aquaponics, Inc. would contribute $5.6 million to the project and own 51% of the facility. SD Food Security, LLC would contribute $5.4 million to the project—raised primarily by selling investment shares—and own 49% of the facility.
As part of their fundraising efforts, Ritesman and Burns each circulated a private placement memorandum that contained false and misleading information about the aquaponics facility. In addition, Ritesman and Burns each made false and fraudulent representations about the facility, either directly or through the salespeople they hired, in an effort to solicit investors for the project. Bank records show that Ritesman and Burns were each stealing investor money and using it for their own purposes rather than for the aquaponics facility, which was never built.
On April 18, 2019, Ritesman pled guilty to all counts he was charged with: ten counts of wire fraud and eight counts of mail fraud.
“Ritesman and Burns used the idea of what could be an innovative agricultural facility to defraud dozens of investors for their own personal gain,” said U.S. Attorney Parsons. “In South Dakota, a state with such strong agricultural roots, such criminal activity will be caught and prosecuted.”
This case was investigated by the Federal Bureau of Investigation and the U.S. Attorney’s Office. Assistant U.S. Attorney Ann M. Hoffman prosecuted the case.
A presentence investigation was ordered for both Ritesman and Burns. Ritesman’s sentencing is set for July 15, 2019. Burns’ sentencing is set for July 22, 2019.
Boone County Man Sentenced to Prison for Meth DistributionRead the Press Release
CHARLESTON, W.Va. – A Boone County man who trafficked methamphetamine was sentenced to six years in federal prison, announced United States Attorney Mike Stuart. Stuart commended the investigation conducted by the Boone County Sheriff’s Office, the West Virginia State Police, the U.S. 119 Drug and Violent Crime Task Force, and the Drug Enforcement Administration.
“Meth is being trafficked in every county in the District,” said United States Attorney Mike Stuart. “We’re working hard with our federal, state and local law enforcement partners to identify meth dealers and hold them accountable.”
Shaine Ray Dingess, 41, previously pled guilty to distribution of methamphetamine. As established by public court filings and hearings, on December 12, 2017, Dingess distributed $50 worth of methamphetamine to a confidential police informant at Dingess’ residence in Nellis, West Virginia, where Dingess’ co-defendant, Bruce Lee Boardman, was present. Boardman supplied Dingess with the methamphetamine and brandished a firearm during the drug transaction. On January 10, 2018, Dingess gave a small amount of marijuana to a confidential police informant. On February 6, 2018, Dingess again sold $50 worth of ice methamphetamine to a confidential police informant. Finally, on April 11, 2018, police investigators spotted Dingess while he was walking in Nellis. When asked if he was carrying any drugs, Dingess turned over five small packages of ice methamphetamine.
Senior United States District Judge John T. Copenhaver, Jr. imposed the sentence. The case was prosecuted by Assistant United States Attorneys R. Gregory McVey and Drew O. Inman.
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Biloxi Man Sentenced to over 23 Years in Prison in Large Scale Heroin OperationRead the Press Release
Gulfport, Miss. – Donald Eric McRoy, 53, of Biloxi, was sentenced today by U.S. District Judge Sul Ozerden to 278 months in federal prison, followed by five years of supervised release, for conspiracy to possess with intent to distribute heroin, announced U.S. Attorney Mike Hurst and Special Agent in Charge Jere T. Miles with Immigration and Customs Enforcement’s Homeland Security Investigations in New Orleans.
On four separate occasions in 2016, McRoy sold, directly or indirectly, quantities of heroin to an individual acting in an undercover capacity along the Gulf Coast. The investigation also revealed that McRoy was obtaining large quantities of heroin from a dealer in the Atlanta, Georgia area. Further investigation has led to the convictions of both McRoy’s supplier and his supplier’s supplier, and has thwarted a large scale heroin operation in south Mississippi.
This case was investigated by Homeland Security Investigations and prosecuted by Assistant U.S. Attorney John Meynardie.#
Attorney Sentenced to Prison for Filing False Tax ReturnsRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that JUSTIN C. FREEMAN, 47, of Manchester, was sentenced today by U.S. District Judge Kari A. Dooley in Bridgeport to eight months of imprisonment, followed by one year of supervised release, for filing tax returns that substantially underreported his income. Judge Dooley also ordered Freeman to pay a $4,000 fine.
According to court documents and statements made in court, Freeman is an attorney who owns and operates his own law practice, The Law Offices of Justin C. Freeman, based in Hartford. For the 2010, 2011 and 2012 tax years, Freeman signed individual federal income tax returns that underreported more than $1.2 million in income he received from his law practice. The returns were subsequently filed by his tax preparer.
For 2010, Freeman reported $476,228 in total income, but actually earned $860,041.93. For 2011, he reported $410,002 in total income, but actually earned $1,093,147.43. For 2012, he reported $529,673 in total income, but actually earned $696,559.43. The tax loss to the IRS resulting from this criminal conduct was $419,259.
On November 28, 2018, Freeman pleaded guilty to one count of filing a false tax return.
Since learning he was under criminal investigation, Freeman has paid the $419,259 he owed for the 2010 through 2012 tax years, and an additional $3,329,527 in taxes, interest and penalties for the 2013 through 2016 tax years, and estimated payments for the 2017 through 2019 tax years. He still owes approximately $1.3 million in back taxes, interest and penalties.
Freeman, who is released on a $100,000 bond, is required to report to prison on July 1, 2019.
This matter was investigated by the Internal Revenue Service – Criminal Investigation Division, and was prosecuted by Assistant U.S. Attorney Susan L. Wines.
Atlantic City Man, Leader of Drug Trafficking Organization, Sentenced to 22 Years in PrisonRead the Press Release
CAMDEN, N.J. – An Atlantic City man was sentenced today to 264 months in prison for his role in a drug trafficking and money laundering in the Atlantic County area, U.S. Attorney Craig Carpenito announced.
Toye Tutis, 46, previously pleaded guilty before U.S. District Judge Jerome B. Simandle to Count One of a second superseding indictment, charging him with conspiracy to distribute and possess with intent to distribute cocaine, crack cocaine and heroin, and Count 13 charging him with conspiring with his long-time paramour, Jazmin Vega, 45, to launder his drug trafficking proceeds. Vega also pleaded guilty to the conspiracy to launder Tutis’ drug proceeds in Count 13 and is scheduled to be sentenced June 14, 2019.
“Defendant Tutis laundered more than just clothing at his Atlantic City laundromat – he also laundered the proceeds of his significant heroin and cocaine drug trafficking ring,” U.S. Attorney Carpenito said. “The sentence handed down today punctuates the end of both his drug trafficking and his money laundering activities, and is yet another example of our efforts to clean up the streets of Atlantic City and the towns surrounding it.”
“This defendant littered the streets of Atlantic City and surrounding areas with dangerous drugs and then washed the money through his laundromat, various businesses and multiple real estate transactions,” FBI Newark Special Agent-in-Charge Gregory W. Ehrie said. “The magnitude of his crimes may never be fully known but his actions fed a deadly drug epidemic that claims countless lives. The FBI is committed to working with our local, state and federal law enforcement partners to drive drug traffickers like Toye Tutis out of business and rid the community of these threats to public health and public safety.”
“Mr. Tutis’ actions show his main concern was making a profit off the misery of others,” said Susan A. Gibson, Special Agent in Charge of the Drug Enforcement Administration’s New Jersey Division. “His term in federal prison will allow him to experience some misery of his own. DEA and our law enforcement partners will continue to pursue those who choose to poison our community.”
According to documents filed in this case and statements made in court:
From 2010 through December 2014, Tutis operated a large-scale drug trafficking ring out of the Ta’Ja Laundromat in Atlantic City, purchasing and distributing between 150 to 450 kilograms of cocaine and approximately 26 kilograms of heroin, and laundering between $1.5 million and $3 million in drug proceeds. Tutis was aided by Vega, who admitted to laundering his drug trafficking proceeds in several ways, including through the couple’s various businesses – Ta’Ja Construction I LLC; Ta’Ja Real Estate Investors LLC; and Integrity Heating and Cooling LLC; and by purchasing more than 30 properties with tainted funds. As part of their plea agreements, Vega and Tutis have to forfeit 20 properties, cash and other assets.
In addition to the prison term, Judge Simandle sentenced Tutis to five years of supervised release.
Nine other people have pleaded guilty to participating in the drug trafficking conspiracy or other related drug trafficking in the Atlantic County area, including:
- Kabaka Atiba, 49, of Atlantic City, sentenced on Oct. 16, 2017, to 120 months in prison and five years of supervised release;
- Tozine Tiller, 45, of Absecon, sentenced on Jan. 3, 2018, to 235 months in prison and five years of supervised release;
- TeJohn Cooper, 45, of Galloway Township, sentenced on Sept. 12, 2017, to 96 months in prison and one year of supervised release;
- Ronald Douglas Byrd, 53, of Pleasantville, sentenced on July 11, 2017, to 96 months in prison and five years of supervised release;
- Kareem Taylor, 43, of Atlantic City, sentencing scheduled for June 3, 2019;
- Talib Tiller, 46, of Mays Landing, sentenced on Sept. 5, 2017, to 57 months in prison and three years of supervised release;
- John Wellman, 43, of Somers Point, sentenced on July 13, 2017, to 130 months in prison and five years of supervised release;
- Phillip Horton, 53, of Los Angeles, California, sentencing scheduled for June 3, 2019;
- and Francisco Alberto Rascon-Muracami, 25, of Obregon, Mexico, sentenced on Oct. 30, 2015, to 70 months in prison and five years of supervised release.
U.S. Attorney Carpenito credited special agents of the FBI’s Newark Division, Atlantic City Resident Agency, under the direction of Special Agent in Charge Gregory W. Ehrie; the DEA’s New Jersey Division, under the direction of Special Agent in Charge Susan A. Gibson; the Atlantic County Prosecutor’s Office, under the direction of Prosecutor Damon G. Tyner; and the Atlantic City Police Department, under the direction of Police Chief Henry White, with the investigation leading to today’s sentencing.
He also thanked the N.J. State Police; the Pennsylvania State Police, the Atlantic County Sheriff’s Office; the Bureau of Alcohol, Tobacco and Firearms; U.S. Immigration and Customs Enforcement (ICE)-Homeland Security Investigation (HSI); U.S. Postal Inspection Service; Cumberland County Sheriff’s Office and the Ventnor, Northfield and Millville police departments for their assistance.
The government is represented by Assistant U.S. Attorneys Diana Carrig of the Camden Division, Jonathan M. Peck of the Newark Division and Peter W. Gaeta of the Asset Recovery and Money Laundering Unit.
Armed Felon Sentenced to 15 Years in Federal PrisonRead the Press Release
Jacksonville, Florida – U.S. District Judge Timothy J. Corrigan today sentenced Jerome Stancil (52, Jacksonville) to 15 years in federal prison for possessing a firearm as a convicted felon.
Stancil had been found guilty on January 31, 2019, following a bench trial.
According to court documents, Stancil was stopped by officers from the Jacksonville Sheriff’s Office for speeding. The officers discovered that Stancil was in violation of his state probation curfew and also noticed an odor of marijuana coming from Stancil’s vehicle. Officers searched Stancil’s car and found a loaded .40 caliber pistol near the driver’s seat. Stancil admitted that the firearm was his and said it was for protection.
At the time, Stancil had prior convictions in Virginia for multiple drug trafficking felonies. As a result of his prior convictions, Stancil was prohibited from possessing a firearm and qualified as an armed career criminal under federal law.
This case was investigated by the Jacksonville Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms and Explosives. It was prosecuted by Assistant United States Attorney Frank Talbot.
This is another case prosecuted as part of the Department of Justice’s “Project Safe Neighborhoods” Program (PSN), which is a nationwide, crime reduction strategy aimed at decreasing violent crime in communities. It involves a comprehensive approach to public safety — one that includes investigating and prosecuting crimes, along with prevention and reentry efforts. In the Middle District of Florida, U.S. Attorney Maria Chapa Lopez coordinates PSN efforts in cooperation with various federal, state, and local law enforcement officials.
Altoona Woman Charged with Obtaining a Controlled Substance by FraudRead the Press Release
JOHNSTOWN, Pa. – A resident of Altoona, Pa., was indicted on April 24, 2019, by a federal grand jury in Pittsburgh on a charge of violating federal narcotics law, United States Attorney Scott W. Brady announced today.
The one-count indictment named Laura M. Singh, 36, as the sole defendant.
According to the indictment presented to the court, from on or about October 17, 2017, to on or about April 18, 2018, Singh obtained a controlled substance by fraud.
The law provides for a maximum sentence of four years in prison and a fine of $250,000 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Maureen S. Sheehan-Balchon is prosecuting this case on behalf of the government.
The Department of Veterans Affairs conducted the investigation that led to the prosecution of Singh.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.