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26 March 2019
Alachua County Man Sentenced to Prison for Harboring Undocumented Aliens and Evading Workers' Compensation and Payroll TaxesRead the Press Release
GAINESVILLE, FLORIDA – Mac Johnson, 51, of Newberry, Florida, was sentenced late yesterday to one year and a day in prison, after pleading guilty on February 27, 2018, to tax fraud, wire fraud, structuring financial transactions to evade reporting requirements, and harboring undocumented aliens. As part of Johnson’s plea, he agreed to make restitution to the IRS. Lawrence Keefe, United States Attorney for the Northern District of Florida, announced the sentence.
U.S. Attorney Keefe said: “I commend the vigilance of our federal and state investigative partners and prosecutors in this case for upholding the laws governing American taxes and employment. Honest individuals and businesses are harmed by these lawbreakers.”
“Today’s sentencing should send a tough message to all of those businesses who believe they can gain an unfair advantage by not paying employment taxes … you will pay in the end,” stated Mary Hammond, Special Agent in Charge of the IRS Criminal Investigation, Tampa Field Office. “The more than $1.7 million in unpaid employment taxes hurt everyone in the community. By not withholding and paying these taxes, the defendant was able to undercut the competition and make an unfair profit at the expense of the taxpayers. Our agents will continue to crack down on businesses and individuals who openly disregard this responsibility.”
“This case is an example of Homeland Security Investigations (HSI) worksite enforcement investigations, which focus on protecting our nation’s critical infrastructures, reducing the demand for illegal employment and protecting employment opportunities for the country's lawful workforce,” said HSI Tampa Special Agent in Charge James C. Spero. “Today’s sentencing should be a reminder about the consequences facing employers who exploit illegal alien labor and violate our nation's laws. No employer, regardless of size, industry, or location, is above the law.”
Johnson, a roofing, tree service, and dumpster business employer, devised a scheme to conceal the amount of wages earned by his undocumented alien employees to avoid paying more than $1.7 million in federal income, Medicare, and social security taxes, as well as more than $1 million in Florida worker’s compensation premiums. Johnson concealed the wages from the State of Florida by inaccurately and incompletely identifying all employees, representing that lower wages were paid than the true amounts, and paying by cash or a non-payroll check in amounts of less than $10,000 to avoid reporting requirements.
The investigators discovered that undocumented alien employees on work sites did not speak English or have any personal identification. Their names did not match the names on the insurance policy, and the undocumented alien employees’ files contained employment eligibility verification forms that did not match their handwriting. Johnson also provided transportation to the work sites and rented residences he owned to the undocumented workers for which he deducted money from their pay.
This case resulted from an investigation by the Internal Revenue Service – Criminal Investigation and the United States Immigration and Customs Enforcement Homeland Security Investigations, with assistance from the Florida Department of Financial Services, Division of Insurance. Assistant U.S. Attorney Gregory P. McMahon prosecuted the case.
The United States Attorney’s Office for the Northern District of Florida is one of 94 offices that serve as the nation’s principal litigators under the direction of the Attorney General. To access public court documents online, please visit the U.S. District Court for the Northern District of Florida website. For more information about the United States Attorney’s Office, Northern District of Florida, visit http://www.justice.gov/usao/fln/index.html.
10 Defendants Charged in Federal Drug and Gun Investigation Centered on West Side of ChicagoRead the Press Release
CHICAGO — Ten individuals are facing criminal charges as part of a federal drug and gun investigation in Chicago.
During the multi-year investigation, law enforcement seized approximately 13 pounds of suspected methamphetamines, a half-kilogram of suspected heroin, approximately 13,000 pills of suspected ecstasy, and 18 firearms. Much of the alleged drug trafficking occurred in the East Garfield Park neighborhood on the West Side of Chicago.
Many of the defendants were arrested Thursday, and detention hearings are being held this week in U.S. District Court in Chicago.
The charges were announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Timothy Jones, Special Agent-in-Charge of the Chicago Field Division of the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives; and Eddie Johnson, Superintendent of the Chicago Police Department. The Illinois State Police provided valuable assistance. Assistant U.S. Attorneys Katie M. Durick, William Dunne and John Mitchell represent the government.
Indictments and criminal complaints unsealed in federal court charge ten defendants with drug or gun offenses. GREGORY HARRIS, 32, of Dolton, is suspected of supplying ecstasy and heroin to ERIC JONES, 44, of Posen, according to the complaint against Jones. Jones sold narcotics on three occasions earlier this year to an individual who, unbeknownst to Jones, was cooperating with law enforcement, the complaint states. Jones was charged with distribution of a controlled substance.
Law enforcement last week carried out a court-authorized search of Harris’s residence and discovered a loaded handgun. Harris was previously convicted of several felonies and was not lawfully allowed to possess a firearm. Harris was charged with one count of illegal possession of a firearm by a convicted felon. During the search, law enforcement also discovered approximately 13 pounds of suspected methamphetamines packaged in cellophane-wrapped, heat-sealed baggies, as well as a quarter-kilogram of suspected heroin, and approximately 10,000 pills of suspected ecstasy.
Three other convicted felons were charged with illegal possession of a firearm: JHALEYL LOTT, 28, of Chicago; DARIAN TAYLOR, 32, of Melrose Park; and TYSHAWN HOLLINS, 21, of Chicago. Taylor and Hollins are also charged with drug offenses for allegedly distributing narcotics.
Five other defendants are charged with various narcotics offenses as part of the investigation: CURTIS SHEPPARD, 21, of Chicago; MICHAEL WARD, 38, of Chicago; DIONETE DOTSON, 28, of North Riverside; KYERRE HENDERSON, 28, of Chicago; and CARL DANIELS, 23, of Chicago.
The public is reminded that charges contain only accusations and are not evidence of guilt. The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. If convicted, the Court must impose reasonable sentences under federal sentencing statutes and the advisory U.S. Sentencing Guidelines.
25 March 2019
Worcester Man Pleads Guilty to Possession of Stolen Firearm and Lying to Firearm DealersRead the Press Release
BOSTON – A Worcester man pleaded guilty today in federal court in Worcester to lying to firearm dealers.
Ruben Ramos, 24, pleaded guilty to two counts of making false statements during the purchase of a firearm, five counts of making false statements in records required to be maintained by a federal firearm dealer, and one count of possession of a stolen firearm. U.S. District Court Judge Timothy S. Hillman scheduled sentencing for July 15, 2019.
In December 2016, Worcester police issued Ramos, an employee of the U.S. Postal Service and member of the Army National Guard, a license to possess firearms. From May 2017 through May 2018, Ramos purchased at least 16 firearms, including 14 pistols and two rifles. On at least five occasions, from March 2018 through May 2018, Ramos knowingly provided a false address to the dealers from whom he purchased seven firearms.
In June 2018, Ramos admitted to federal investigators that he only possessed six of the 16 guns that he purchased over the previous 12 months. Ramos admitted that he lied to firearms dealers on two occasions in May 2018, when he acted as a “straw buyer,” by claiming that he was buying the gun for himself when, in fact, he was buying the guns on behalf of another person. Additionally, in June 2018, investigators found a Beretta 9 mm pistol in Ramos’ residence that was the property of the Army National Guard. Ramos admitted that he had stolen the Beretta 9 mm pistol from the weapons vault at the Army National Guard facility on Plantation Street in Worcester.
The charges of making a false statement during the purchase of a firearm and possession of a stolen firearm each provide for a sentence of no greater than 10 years in prison, up to three years of supervised release, and a fine of up to $250,000. The charges of making a false statement in records required to be maintained by a federally licensed firearm dealer provide for a sentence of no greater than five years in prison, up to three years of supervised release, and a fine of up to $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling; Kelly Brady, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms, & Explosives, Boston Field Division; and Worcester Police Chief Steven Sargent made the announcement today. Assistant U.S. Attorney Greg A. Friedholm of Lelling’s Worcester Branch Office is prosecuting the case.
Woman Who Temporarily Lived in a Charlottesville Hotel Indicted on Obstruction and False Statement ChargesRead the Press Release
Charlottesville, VIRGINIA – A federal grand jury sitting in U.S. District Court in Charlottesville has charged a woman who had lived in Charlottesville with multiple counts of making false statements, obstruction, and harboring a fugitive after she allegedly lied to agents with the U.S. Marshals Service regarding the whereabouts of a convicted sex offender. United States Attorney Thomas T. Cullen and Acting United States Marshal Richard “Brad” Sellers made the announcement today.
In an indictment returned under seal on March 13, 2019 and unsealed today following her initial court appearance and arraignment, Janna Rebecca Smith, a.k.a. “Rabbit,” 43, is charged with three counts of making false statements, one count of obstruction of justice, and one count of harboring or concealing a person for whose arrest she knew a warrant had been issued.
“Making a false statement to a federal agent is a serious crime and one that this office will vigorously prosecute,” U.S. Attorney Cullen stated today. “We will also investigate and prosecute individuals who unlawfully impede the United States Marshals Service in the performance of their duties, including by harboring fugitives or registered sex offenders.”
“Lying to federal officials during the course of their investigation cannot and will not be tolerated,” Acting U.S. Marshal Sellers said today. “These charges illustrate an alleged blatant disregard for the rule of law, that deserve the prosecutorial attention they are getting. Our Deputy Marshals, along with our fugitive task force officers, do their utmost best to make our communities safer on a daily basis.”
According to the indictment, between approximately May 30, 2018 and July 10, 2018, Smith assisted Christopher Mixell, a previously-convicted sex offender with an outstanding arrest warrant, evade arrest in part by providing false information to the United States Marshals Service. The United States Attorney’s Office recently concluded a prosecution of Mixell for failing to update his sex offender registration. His case is presently on appeal.
The Indictment alleges that Smith made false statements to the United States Marshals Service on three separate dates between May 31, 2018, and July 10, 2018, concerning her alleged lack of knowledge about Mixell’s whereabouts and her alleged lack of contact with Mixell. The other two charges allege, in part, that Smith assisted Mixell in evading arrest between May 30, 2018, and July 10, 2018.
The investigation of the case was conducted by the U.S. Marshals Service. Assistant United States Attorney Nancy S. Healey is prosecuting the case for the United States.
A Grand Jury Indictment is only a charge and not evidence of guilt. The defendant is entitled to a fair trial with the burden on the government to prove guilt beyond a reasonable doubt.
Wheeling woman admits to distributing methamphetamineRead the Press Release
WHEELING, WEST VIRGINIA –Lauren Hedges, of Wheeling, West Virginia, has admitted to distributing methamphetamine near a school, United States Attorney Bill Powell announced.
Hedges, age 26, pled guilty to one count of “Aiding and Abetting Possession with Intent to Distribute Methamphetamine within 1,000 Feet of a Protected Location.” Hedges admitted to distributing methamphetamine within 1,000 feet of Wheeling Central Catholic High School in November 2018.
Hedges faces not less than one and up to 40 years incarceration and a fine of up to $2,000,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Stephen L. Vogrin is prosecuting the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives; the West Virginia State Police; and the Ohio Valley Drug & Violent Crimes Task Force, a HIDTA-funded initiative, investigated.
Senior U.S. District Judge Frederick P. Stamp, Jr. presided.
Wetzel County woman admits to distributing methamphetamineRead the Press Release
WHEELING, WEST VIRGINIA – Megan Leigh Thompson, of Proctor, West Virginia, has admitted to distributing methamphetamine, United States Attorney Bill Powell announced.
Thompson, age 32, pled guilty to one count of “Conspiracy to Distribute and to Possess with Intent to Distribute Methamphetamine.” Thompson admitted to distributing methamphetamine from January 2017 to September 2018 in Wetzel County.
Thompson faces up to 20 years incarceration and a fine of up to $1,000,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Shawn M. Adkins is prosecuting the case on behalf of the government. The Drug Enforcement Administration; the Marshall County Drug & Violent Crimes Task Force, a HIDTA-funded initiative; the Monroe County, Ohio, Sheriff's Department; and the New Martinsville Police Department investigated.
Senior U.S. District Judge Frederick P. Stamp, Jr. presided.
United States Files Suit Against West Virginia Hospital, Its Management Company, and Its CEO Based on Kickbacks and Other Improper Payments to PhysiciansRead the Press Release
WASHINGTON – The United States has filed a complaint under the False Claims Act against Wheeling Hospital, Inc., R & V Associates, Ltd. (R & V), and Ronald Violi in the U.S. District Court for the Western District of Pennsylvania, the Department of Justice announced today. The government has alleged that Wheeling Hospital, which is located in Wheeling, WV, violated the Stark Law and Anti-Kickback Statute, and that those violations were caused by R & V, Wheeling’s contracted management consultant, and Violi, Wheeling’s CEO.
The Stark Law prohibits a hospital from billing Medicare for services referred by physicians who have improper financial relationships with the hospital. The Anti-Kickback Statute prohibits offering or paying anything of value to induce the referral of items or services covered by Medicare, Medicaid, and other federal healthcare programs. The United States alleges that Wheeling’s compensation to a number of employed and contracted physicians violated these statutory prohibitions because that compensation was based on the volume or value of the physicians’ referrals or exceeded the fair market value of the physicians’ services.
"Improper financial arrangements between hospitals and physicians can influence the type and amount of health care that is provided," said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division. "The Department is committed to taking action to eliminate improper inducements that can corrupt the integrity of physician decision-making and drive up healthcare costs for all of us."
"Medicare and Medicaid beneficiaries trust that their healthcare providers will make decisions based on sound medical judgment," said U.S. Attorney Scott W. Brady. "Our office will take decisive action against any medical providers who betray that trust and make medical decisions based on their own financial interests."
The United States filed its complaint in a lawsuit filed under the qui tam, or whistleblower, provisions of the False Claims Act. Those provisions authorize private parties to sue on behalf of the United States for false claims and share in any recovery. The Act permits the United States to intervene and take over the lawsuit, as it did here in part.
The government’s intervention in this matter illustrates the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services, at 800-HHS-TIPS (800-447-8477).
This case was investigated by the U.S. Department of Health and Human Services Office of Inspector General and the Federal Bureau of Investigation, and is being handled by Assistant United States Attorney Colin J. Callahan and Department of Justice Trial Attorney Rohith Srinivas.
The case is captioned United States of America ex rel. Louis Longo v. Wheeling Hospital, Inc. et al., No. 17-cv-1654 (W.D. Pa.). The claims asserted against defendants are allegations only and there has been no determination of liability.
United States Files Lawsuit Against West Virginia Hospital, Its Management Company, and Its CEO Based on Kickbacks and Other Improper Payments to PhysiciansRead the Press Release
The United States filed a complaint under the False Claims Act against Wheeling Hospital Inc., R & V Associates Ltd. (R & V), and Ronald Violi in the U.S. District Court for the Western District of Pennsylvania, the Department of Justice announced today. The government alleges that Wheeling Hospital, which is located in Wheeling, West Virginia, violated the Stark Law and Anti-Kickback Statute, and that those violations were caused by R & V, Wheeling’s contracted management consultant, and Violi, Wheeling’s CEO.
The Stark Law prohibits a hospital from billing Medicare for services referred by physicians who have improper financial relationships with the hospital. The Anti‑Kickback Statute prohibits offering or paying anything of value to induce the referral of items or services covered by Medicare, Medicaid, and other federal healthcare programs. The United States alleges that Wheeling’s compensation to a number of employed and contracted physicians violated these statutory prohibitions because that compensation was based on the volume or value of the physicians’ referrals or exceeded the fair market value of the physicians’ services.
“Improper financial arrangements between hospitals and physicians can influence the type and amount of health care that is provided,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division. “The Department is committed to taking action to eliminate improper inducements that can corrupt the integrity of physician decision-making and drive up healthcare costs.”
“Medicare and Medicaid beneficiaries trust that their healthcare providers will make decisions based on sound medical judgment,” said U.S. Attorney Scott W. Brady. “Our office will take decisive action against any medical providers who betray that trust and make medical decisions based on their own financial interests.”
The United States filed its complaint in a lawsuit filed under the qui tam, or whistleblower, provisions of the False Claims Act. Those provisions authorize private parties to sue on behalf of the United States for false claims and share in any recovery. The Act permits the United States to intervene and take over the lawsuit, as it did here in part.
The government’s intervention in this matter illustrates the government’s emphasis on combating healthcare fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services, at 800‑HHS‑TIPS (800-447-8477).
This matter was investigated by the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Office for the Western District of Pennsylvania, the U.S. Department of Health and Human Services Office of Inspector General, and the FBI.
The case is captioned United States of America ex rel. Louis Longo v. Wheeling Hospital, Inc. et al., No. 17-cv-1654 (W.D. Pa.). The claims asserted against defendants are allegations only and there has been no determination of liability.
United States Attorney Minkler celebrates Asian Heritage Month with keynote speaker G. Michael Witte Executive Director, Indiana Disciplinary CommissionRead the Press Release
Indianapolis-United States Attorney Josh J. Minkler and the USAO Diversity Committee will be hosting a noon-time brown bag lunch gathering on Wednesday, April 10, 2019, at 10 W. Market Street, 20th Floor Goodloe Conference Room. G. Michael Witte, Executive Director, Indiana Disciplinary Commission is the keynote speaker. Witte is a graduate of Indiana University with both B.A. and J.D. degrees. Witte was the first Asian American to serve as judge in the State of Indiana and his twenty-five year career includes serving as Judge Pro Tem of Wayne County Superior Court, Richmond, Indiana (2009), and Judge of the Dearborn Superior Court, Lawerenceburg, Indiana (2000-2008), among many other distinguished accomplishments. Witte is also an active member of Indiana’s Asian Pacific Bar Association (IN-APABA). Witte’s teaching experience is primarily in the field of imparied driving and traffic court adminstration.
United States Attorney Minkler extends an invitation to USAO-SDIN Alumni and members of the federal judiciary and court family to join the office for this important commemorative event.
G. Michael Witte, Executive Director, Indiana Disciplinary Commission
United States Attorney Mike Stuart Continues Listening Tour in Mingo CountyRead the Press Release
CHARLESTON, W.Va. – United States Attorney Mike Stuart today announced that he will host a public safety community forum in Williamson, West Virginia on April 4, 2019. The forums, presented in partnership with West Virginia’s Substance Abuse Prevention Coalitions, continue to be held at locations throughout the Southern District of West Virginia to provide an opportunity for an open discussion on substance abuse, violent crime, school safety, and other public safety issues currently impacting local communities. City and county government officials, public health officials, school administrators, teachers, parents, students, church leaders, residents and area law enforcement representatives are encouraged to attend the community forums.
The Mingo County community forum will begin at 6:00pm on Thursday, April 4, 2019 at the Southern West Virginia Community College, 1601 Armory Drive, Williamson, West Virginia.
For more information, please email Public Information Officer/Law Enforcement Coordinator Deanna Eder at [email protected].
SDWVNews and USAttyStuart
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U.S. Attorney’s Office Honors 25 Law Enforcement Officials in Awards Ceremony for Outstanding Efforts in Fighting CrimeRead the Press Release
Harrisburg – The United States Attorney’s Office for the Middle District of Pennsylvania announced that U.S. Attorney David J. Freed presented awards on Friday, March 22, 2019, to members of law enforcement agencies for their outstanding efforts in fighting crime.
“Cooperation among federal, state and local law enforcement is a key component in our mission to reduce crime and protect law-abiding citizens throughout the Middle District of Pennsylvania,” said U.S. Attorney Freed. “We are pleased and proud to recognize our colleagues who stand out for their bravery, dedication and service.”
The award recipients are being honored for their exceptional heroism, distinguished service, and outstanding contributions to cooperative law enforcement. Those honored at Friday’s ceremony included:
Nine members of the U.S. Marshals Taskforce received the Exceptional Heroism Award for their involvement in a shootout with a fugitive, which Deputy U.S. Marshal Christopher Hill was killed in the line of duty. Included in receiving this award was the family of U.S. Deputy Marshal Christopher Hill.
Three law enforcement members are receiving the Lifetime Service Award which recognized their many years of exemplary service to their agency:
- One Special Agent with the Drug Enforcement Agency (DEA);
- Task Force Officer of the PA State Police assigned to the FBI; and
- Wyoming County District Attorney’s Office Chief Detective David A. Ide.
Lebanon County First Assistant District Attorney Nichole Eisenhart received an Award For Outstanding Trial Advocacy by a Special Assistant United States Attorney for her contributions in connection with a large drug case in Lebanon County that resulted in numerous convictions and seizures of firearms and drugs.
Three law enforcement members received an Award For Outstanding Contributions to Cooperative Law Enforcement for significantly increasing cooperation among law enforcement agencies:
- York City Police Department Chief of Police Troy Bankert;
- Luzerne County District Attorney Stefanie J. Salavantis;
- Postal Inspector with the U.S. Postal Inspection Service
The following individuals received an Award For Distinguished Service for their exceptional work in complex investigations:
- DEA Special Agent Michael Neff;
- Federal Bureau of Investigation Special Agents Bruce Doupe, Gary Leone, and Larry Whitehead;
- Task Force Officer working with the FBI Hugh Earhart;
- Pennsylvania Department of Agriculture employees Walt Remmert, Charles “J.R.” Anderson, and George Minner; and
- Fairview Township Police Department Sergeant Mike Bennage.
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U.S. Attorney Announces the Arrest of Michael Avenatti for Engaging in A Scheme to Extort A Public CompanyRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, and William F. Sweeney Jr., Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), announced the arrest today of MICHAEL AVENATTI on federal extortion and interstate threat charges. As alleged, AVENATTI, an attorney, attempted to extract more than $20 million in payments from a publicly traded company by threatening to use his ability to garner publicity to inflict substantial financial and reputational harm on the company if his demands were not met. AVENATTI was simultaneously arrested on separate charges brought by the U.S. Attorney’s Office for the Central District of California. AVENATTI will be presented today in Manhattan federal court before U.S. Magistrate Judge Katharine H. Parker.
Manhattan U.S. Attorney Geoffrey S. Berman said: “As alleged, Avenatti used illegal and extortionate threats for the purpose of obtaining millions of dollars in payments from a public company. Calling this anticipated payout a retainer or a settlement doesn’t change what it was – a shakedown. When lawyers use their law licenses as weapons, as a guise to extort payments for themselves, they are no longer acting as attorneys. They are acting as criminals, and they will held responsible for their conduct.”
FBI Assistant Director in Charge William F. Sweeney Jr. said: “As alleged, Michael Avenatti approached Nike last week with a list of financial demands in exchange for covering up allegations of misconduct on behalf of the company. The lofty price tag included a $1.5 million payoff for Avenatti’s client and upwards of tens of millions of dollars for the legal services of his firm – services Nike never requested. This is nothing more than a straightforward case of extortion. In the event anyone needs to be reminded, this type of behavior is illegal and it will not be tolerated – especially when committed by a lawyer who is supposed to use his license to practice law, not to willfully violate it.”
According to the allegations in the Complaint unsealed today[1]:
Background to the Extortion Scheme
In a scheme that unfolded in less than a week, AVENATTI and a co-conspirator not named as a defendant in the Complaint (“CC-1”) used threats of economic and reputational harm to extort NIKE, Inc. (“Nike”), a multinational corporation engaged in, among other things, the marketing and sale of athletic apparel, footwear, and equipment. Specifically, AVENATTI threatened to hold a press conference on the eve of Nike’s quarterly earnings call and the start of the annual National Collegiate Athletic Association (“NCAA”) men’s basketball tournament at which he would announce allegations of misconduct by employees of Nike. AVENATTI stated that he would refrain from holding the press conference and harming Nike only if Nike made a payment of $1.5 million to a client of AVENATTI’s in possession of information damaging to Nike (“Client-1), and further agreed to “retain” AVENATTI and CC-1 to conduct an “internal investigation” – an investigation that Nike did not request – for which AVENATTI and CC-1 demanded to be paid, at a minimum, between $15 and $25 million. Alternatively, and in lieu of such a retainer agreement, AVENATTI and CC-1 demanded a total payment of $22.5 million from Nike to resolve any claims Client-1 might have and additionally to buy AVENATTI’s silence.
The March 19 Meeting With Avenatti
As alleged, AVENATTI first met with representatives of Nike last Tuesday, March 19, 2019, in New York, New York. At that meeting, AVENATTI claimed to represent a coach of an amateur youth travel basketball team sponsored by Nike, i.e., Client-1. AVENATTI claimed the team coached by Client-1 had recently lost its sponsorship with Nike, one worth approximately $72,000 a year, and that his client had information that Nike employees had been engaged in illicit payments to the families of high school student athletes. AVENATTI further stated that he planned to hold a press conference the next day announcing allegations of misconduct at Nike, and made clear that he had approached Nike now because he knew that the annual NCAA tournament – an event of significance to Nike and its brand – was about to begin, and further because he was aware that Nike’s quarterly earnings call was scheduled for March 21, 2019, thus maximizing the potential financial and reputational damage his press conference could cause to Nike.
AVENATTI further stated that he would refrain from holding that press conference and damaging Nike if Nike agreed to two demands: (1) Nike must pay $1.5 million to Client-1 as a settlement for any claims Client-1 might have regarding Nike’s decision not to renew its contract with the team coached by Client-1; and (2) Nike must hire AVENATTI and CC-1 to conduct an internal investigation of Nike, with a provision that if Nike hired another firm to conduct such an internal investigation, Nike would still be required to pay AVENATTI and CC-1 at least twice the fees of any other firm hired. AVENATTI made clear that Nike would have to agree to accept those demands on a very short time frame. Nike immediately contacted the United States Attorney’s Office for the Southern District of New York, which launched an investigation in conjunction with the FBI.
The March 20 Call With Avenatti
In a follow-up call on March 20, 2019, recorded by law enforcement, AVENATTI reiterated both his threat, stating, in substance and in part, that unless Nike immediately agreed to his financial demands, he would hold his press conference and, as AVENATTI threatened: “I’ll go and I’ll go take ten billion dollars off your client’s market cap. But I’m not fucking around.” During the same call, AVENATTI made clear that his demands included not simply that he and CC-1 be paid for an “internal investigation,” but that he be paid more than $9 million. As AVENATTI stated during the call: “I’m not fucking around with this, and I’m not continuing to play games. . . . You guys know enough now to know you’ve got a serious problem. And it’s worth more in exposure to me to just blow the lid on this thing. A few million dollars doesn’t move the needle for me. I’m just being really frank with you. So if that’s what, if that’s what’s being contemplated, then let’s just say it was good to meet you, and we’re done. And I’ll proceed with my press conference tomorrow. . . . I’m not fucking around with this thing anymore. So if you guys think that you know, we’re gonna negotiate a million five, and you’re gonna hire us to do an internal investigation, but it’s gonna be capped at 3 or 5 or 7 million dollars, like let’s just be done.”
The March 21 Meeting With Avenatti
On March 21, 2019, at the direction of law enforcement, representatives of Nike met again with AVENATTI and CC-1. During the meeting, AVENATTI reiterated his demand for a
$1.5 million payment for his client and, with respect to his demand to be retained for an internal investigation, AVENATTI stated, in substance and in part, that he and CC-1 would require a $12 million retainer to be paid immediately and to be “deemed earned when paid,” with a minimum guarantee of $15 million in billings and a maximum fee of $25 million, “unless the scope changes.” When informed by an outside attorney for Nike (“Attorney-1”) that Attorney-1 has never received a $12 million retainer from Nike and never done an investigation for Nike “that breaks $10 million,” AVENATTI responded, in substance and in part, by asking whether Attorney-1 has ever “held the balls of the client in your hand where you could take five to six billion dollars market cap off of them?”
When Attorney-1 asked, in substance and in part, whether Nike could resolve the demands just by paying Client-1, rather than retaining AVENATTI and CC-1, AVENATTI and CC-1 conferred privately. AVENATTI then stated: “If [Nike] wants to have one confidential settlement and we’re done, they can buy that for twenty-two and half million dollars and we’re done. . . . Full confidentiality, we ride off into the sunset. . . .” AVENATTI then laid out again his threat of harm to Nike, adding that “as soon as this becomes public, I am going to receive calls from all over the country from parents and coaches and friends and all kinds of people – this is always what happens – and they are all going to say I’ve got an email or a text message or – now, 90% of that is going to be bullshit because it’s always bullshit 90% of the time, always, whether it’s R. Kelly or Trump, the list goes on and on – but 10% of it is actually going to be true, and then what’s going to happen is that this is going to snowball . . . and every time we got more information, that’s going to be the Washington Post, the New York Times, ESPN, a press conference, and the company will die – not die, but they are going to incur cut after cut after cut after cut, and that’s what’s going to happen as soon as this thing becomes public.”
Shortly after the March 21, 2019, meeting ended, and consistent with the threats AVENATTI communicated, AVENATTI posted a message to Twitter writing, in reference to an article about a prior prosecution involving employees of a rival company: “Something tells me that we have not reached the end of this scandal. It is likely far far broader than imagined…”
* * *
AVENATTI, 48, of Los Angeles, California, is charged with one count of conspiracy to transmit interstate communications with intent to extort, which carries a maximum penalty of five years in prison, one count of conspiracy to commit extortion, which carries a maximum penalty of 20 years in prison, one count of transmission of interstate communications with intent to extort, which carries a maximum penalty of two years in prison, and one count of extortion, which carries a maximum penalty of 20 years in prison. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Berman praised the work of the FBI and the Special Agents of the United States Attorney’s Office for the Southern District of New York, and noted that the investigation is ongoing.
The case is being handled by the Office’s Public Corruption Unit. Assistant United States Attorneys Matthew Podolsky, Robert L. Boone, and Robert B. Sobelman are in charge of the prosecution.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth below constitute only allegations, and every fact described should be treated as an allegation.
Two from Indiana Charged with Marijuana TraffickingRead the Press Release
United States Attorney Ron Parsons announced that two individuals from Indiana have been indicted by a federal grand jury for Possession with Intent to Distribute Marijuana and Conspiracy to Distribute Marijuana.
Brendan Lee, age 23, from Chesterton, Indiana, and Sarah Worthman, age 23, from Bloomfield, Indiana, were indicted on March 5, 2019. Both appeared before U.S. Magistrate Judge Mark A. Moreno on March 7, 2019, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 20 years in federal prison and/or a $1,000,000 fine, up to life of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on February 21, 2019, Lee and Worthman were traveling through the Cheyenne River Sioux Tribe Reservation in a U-Haul truck and were stopped by law enforcement. During the traffic stop, law enforcement found approximately 151 pounds of marijuana in their vehicle. Lee and Worthman were apprehended at the scene.
The charges are merely accusations and Lee and Worthman are presumed innocent until and unless proven guilty.
The investigation is being conducted by the Cheyenne River Sioux Tribe Law Enforcement Services and the Northern Plains Safe Trails Drug Enforcement Task Force. Assistant U.S. Attorney Cameron J. Cook is prosecuting the case.
Lee was remanded to the custody of the U.S. Marshals Service pending trial and Worthman was released on bond conditions. A trial date has been set for April 30, 2019.
Two L.A. County Crews Who Allegedly Used Darknet to Traffic Narcotics Face Federal Criminal Conspiracy ChargesRead the Press Release
LOS ANGELES – Members of two alleged Los Angeles County crime rings have been charged in separate federal criminal cases alleging they conspired to use the Darknet to illicitly and secretly sell methamphetamine and other illegal narcotics nationwide, including one shipment of heroin in a stuffed animal that led to the fatal overdose of a customer in Tennessee.
In a nine-count indictment returned last week, five members of the Los Angeles-based “Drugpharmacist” drug trafficking organization, named for the moniker it used on the Darknet marketplaces Wall Street Market and Dream, have been charged with, among other things, conspiracy to distribute methamphetamine, heroin, cocaine, and crack cocaine. The defendants, all of them from Lancaster, are:
- Jerrell Eugene Anderson, 28;
- Christopher Carion Van Holton, 31;
- Adan Sepulveda, 26;
- Kenneth Lashawn Hadley, 31; and
- Jackie Walter Burns, 20
All five defendants were arrested on a criminal complaint earlier this month and are out on bond. Their arraignments are expected in the coming weeks.
According to an affidavit filed with a criminal complaint in the case, the defendants sold controlled substances to Drugpharmacist customers via the Darknet, and distributed them inside stuffed animals through the United States Postal Service. One shipment of heroin on August 7, 2018 resulted in the fatal overdose of a victim in Knoxville, Tennessee. An investigation into the organization confirmed that the ring was using stash houses in the San Fernando Valley to package drugs for delivery to customers throughout the United States. If convicted on all counts, each defendant faces a statutory maximum sentence of life in federal prison.
In a separate case, three members of the Darknet vendor “Aeirla” have agreed to plead guilty to conspiracy to distribute controlled substances. The group conducted 2,289 sales of methamphetamine and cocaine as of November 28, 2018, according to an affidavit filed with the case’s criminal complaint. Undercover federal agents conducted 26 purchases of methamphetamine from Aeirla between March 2017 and December 2018, the affidavit states. The defendants charged are:
- Anh Pham, 49, of Hawaiian Gardens,
- Joseph Michael Gifford, 43, of La Crescenta; and
- Carlos Miguel Gallardo, 59, of Hawaiian Gardens
Pham allegedly sold pound quantities of methamphetamine on the Darknet while Gifford and Gallardo packaged them in toys, a beach ball, and boxes of Christmas cards and chocolates, and shipped them to customers nationwide, including to a customer in Pittsburgh who in reality was an undercover agent, court papers state. Pham and Gallardo are in custody while Gifford, who signed a plea agreement today, is free on bond. The statutory maximum sentence each defendant faces is life in federal prison. Gifford also faces a narcotics distribution charge in a separate criminal case brought by the United States Attorney’s Office for the Western District of Pennsylvania.
“Law enforcement continues to shine a spotlight on criminals who use the Darknet,” said United States Attorney Nick Hanna. “My office will continue to target drug peddlers who use increasingly sophisticated means in their misguided notion they can avoid detection.”
An indictment and a criminal complaint contain allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
The Aeirla matter is being investigated by the Federal Bureau of Investigation in Pittsburgh and Los Angeles as well as the Drug Enforcement Administration and the U.S. Postal Inspection Service. The Drugpharmacist case is being investigated by the U.S. Postal Inspection Service, the Federal Bureau of Investigation, and the Los Angeles Police Department.
The Aeirla case is being prosecuted by Assistant United States Attorney Christopher Kendall of the Organized Crime Drug Enforcement Task Force Section and the Drugpharmacist case is being prosecuted by Assistant United States Attorney Robyn Bacon of the Cyber & Intellectual Property Crimes Section.
Two Individuals Charged in Health Care Fraud Scheme Involving Drug and Alcohol Rehabilitation Center with Multiple Pennsylvania LocationsRead the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced today the filing of federal charges in connection with a health care fraud scheme involving Liberation Way, a drug and alcohol rehabilitation organization that had treatment centers in Yardley, Bala Cynwyd, and Fort Washington, Pennsylvania. Dr. Ramesh Sarvaiya, 64, of Voorhees, New Jersey, and Jessie Peters, 44, of Lake Worth, Florida, charged separately by Information, are each charged with one count of conspiracy to commit health care fraud, in violation 18 U.S.C. § 371. The federal charges were announced at a press conference announcing related state charges filed by the Pennsylvania Office of the Attorney General.
The federal charging documents allege each man participated in an elaborate scheme involving thousands of medically-unnecessary urine tests ordered by Dr. Sarvaiya and processed by a lab in Florida associated with Peters. The charging documents allege that defendant Sarvaiya ordered tests to be performed on samples obtained from Liberation Way patients, even though Sarvaiya never treated those patients. The tests were then sent to Florida-based laboratories for a battery of unnecessary tests, and Peters allegedly paid kickbacks to principals at Liberation Way in return for directing the samples to his company.
If convicted, each defendant faces a maximum possible sentence of five years’ imprisonment and a fine of $250,000, along with restitution of millions to the victims of this fraud.
“With these charges, we intend to send a clear message to those seeking to build their fortunes on fraud and the despair of individuals battling addiction: health care fraud and the opioid epidemic are major priorities for the United States Attorney’s Office, and your illegal actions will be uncovered,” said First Assistant U.S. Attorney Williams at the press conference earlier today. “We are honored to work together with the Pennsylvania Office of the Attorney General, the Florida State Attorney’s Office, as well as with the Federal Bureau of Investigation, Department of Health and Human Services–Office of the Inspector General, and the Office of Personnel Management–Office of the Inspector General, on these critical issues that impact each and every individual as a health care consumer.”
“It’s shameful when medical professionals prioritize profits over patients,” said Christian Zajac, Assistant Special Agent in Charge of the FBI’s Philadelphia Division. “For those involved, insurance schemes must seem like a convenient way to cash in. Just know that the FBI, alongside our state and federal partners, is committed to finding, investigating and bringing to justice anyone defrauding this country’s vital healthcare system. In other words: you won’t get away with it forever.”
"Today's fine work by the Department of Justice, OPM-OIG criminal investigators, and our other law enforcement partners demonstrates our office's commitment to combatting fraud and abuse in the Federal Employees Health Benefits Program," said Thomas W. South, Deputy Assistant Inspector General for Investigations, U.S. Office of Personnel Management. "We will continue to aggressively investigate and prosecute all individuals who seek to steal taxpayer dollars and drive up health care costs for Federal employees and their families."
“Combating health care fraud and the opioid epidemic are top priorities, said Maureen R. Dixon, Special Agent in Charge, of the Office of the Inspector General for the Department of Health and Human Services (HHS-OIG). HHS-OIG will continue to work with our law enforcement partners to protect the integrity of all HHS Programs.”
The case was investigated by the Federal Bureau of Investigation, the Department of Health and Human Services, the Office of Personnel Management, and the Department of Labor, in conjunction with the Pennsylvania Office of the Attorney General and the Florida State Attorney’s Office. It is being prosecuted by Assistant United States Attorney Nancy Winter.
An Indictment, Information or Criminal Complaint is an accusation. A defendant is presumed innocent unless and until proven guilty.
Two Individuals Charged in 64 Pound Methamphetamine BustRead the Press Release
United States Attorney Erica H. MacDonald today announced a criminal complaint charging GONZALO JIMINEZ-PAZ, JR., 22, and REY DAVID LUNA-SANTILLANES, 22, with conspiracy to distribute methamphetamine. JIMINEZ-PAZ and LUNA-SANTILLANES were arrested earlier today and made their initial appearances before Magistrate Judge Tony Leung in U.S. District Court in Saint Paul, Minnesota.
According to a criminal complaint, on March 23, 2019, law enforcement officers with the Ramsey County Violent Crime Enforcement Team (VCET) executed a search warrant at a residence in the downtown area of Minneapolis. During execution of the search warrant, officers recovered approximately 64 pounds of suspected methamphetamine, a large sum of U.S. currency, 3 pounds of suspected heroin, a bag containing unidentified blue pills and two loaded hand guns. The methamphetamine was found inside two suitcases, the heroin was hidden inside of a shoebox, and a large amount of cash was located in a kitchen cupboard.
This case is the result of an investigation conducted by the St. Paul Police Department, the Ramsey County VCET, the DEA, the Minnesota Bureau of Criminal Apprehension (“BCA”), and the Minnesota State Patrol.
Assistant U.S. Attorney LeeAnn K. Bell is prosecuting the case.
Defendant Information:
GONZALO JIMINEZ-PAZ, JR., 22
Minneapolis, Minn.
Charges:
- Conspiracy to distribute methamphetamine, 1 count
REY DAVID LUNA-SANTILLANES, 22
Minneapolis, Minn.
Charges:
- Conspiracy to distribute methamphetamine, 1 count
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United States Attorney’s Office, District of Minnesota: (612) 664-5600
The charges contained in the criminal complaint are merely allegations, and the defendants are presumed innocent unless and until proven guilty.
Two Indiana Men Plead Guilty to Armed Robbery of Scranton PharmacyRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced that Coreon House, age 21, and Rashad Coleman, age 25, both of Indianapolis, Indiana, pleaded guilty on March 20, 2019, before United States District Court Senior Judge James M. Munley to armed robbery of a CVS Pharmacy in Scranton.
According to United States Attorney David J. Freed, House and Coleman admitted to the armed robbery of a pharmacy and brandishing a firearm in furtherance of a crime of violence, filed as a result of the armed robbery of the CVS Pharmacy, located on Moosic Street in Scranton, which occurred on May 21, 2018. House, Coleman and a third individual, Nicola Dunlap, age 21, also of Indianapolis, traveled from Indianapolis to the CVS Pharmacy in Scranton. Upon entering the pharmacy, House pointed a firearm at a CVS employee while Coleman acted as a lookout and Dunlap acted as a getaway driver. House and Coleman proceeded to take numerous bottles of pills from the pharmacy, including oxycodone, morphine and xanax. All three were apprehended a short time later after police stopped the vehicle in which they were traveling. All three were indicted by a grand jury on July 10, 2018.
Judge Munley ordered that presentence investigations be completed for House and Coleman. The charges against Dunlap are still pending.
The investigation was conducted by the Federal Bureau of Investigation, the Scranton Police Department and the Pennsylvania State Police. Assistant United States Attorney Robert J. O’Hara is prosecuting the case.
This case is part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017, as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local and tribal enforcement and the local community to develop effective, locally-based strategies to reduce crime.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty for the charge of armed robbery of a pharmacy under federal law is 25 years of imprisonment, a term of supervised release following imprisonment, and a $250,000 fine. The charge of brandishing a firearm in furtherance of a crime of violence carries a mandatory minimum sentence of seven years, consecutive to any other sentence. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Steubenville, Ohio man sentenced for drug chargeRead the Press Release
WHEELING, WEST VIRGINIA – Leon King, of Steubenville, Ohio, was sentenced today to 18 months incarceration for distributing heroin and cocaine, United States Attorney Bill Powell announced.
King, age 41, pled guilty to one count of “Distribution of Heroin and Cocaine” in December 2018. King admitted to selling heroin and cocaine in Hancock County in April 2018.
Assistant U.S. Attorney Robert H. McWilliams, Jr., is prosecuting the case on behalf of the government. The Drug Enforcement Administration and the Marshall County Drug & Violent Crimes Task Force, a HIDTA-funded initiative, investigated.
Senior U.S. District Judge Frederick P. Stamp, Jr. presided.
Sexual exploitation of minor sends Kalispell man to prison for 15 yearsRead the Press Release
MISSOULA—A Kalispell man who was convicted of creating a sexually explicit video of a minor girl was sentenced recently to the minimum mandatory 15 years in prison, 10 years of supervised release and ordered to pay $3,000 restitution, said U.S. Attorney Kurt Alme.
Allen Duane Turman, 44, pleaded guilty to sexual exploitation of a child during a Nov. 29 hearing.
Chief U.S. District Judge Dana L. Christensen presided at the March 22 sentencing.
Prosecution evidence showed that in October 2017, a law enforcement officer received a call about a thumb drive that belonged to Turman. A forensic analysis of the device showed it contained a sexually explicit video of a girl who was under the age of 18. By looking at other files on the thumb drive, law enforcement determined that Turman had created the video.
When interviewed in April 2018, Turman told law enforcement that the victim had stayed with him but that he was using drugs at the time and his memory was poor. While he could not specifically remember making the video on the thumb drive, he did not dispute he created it.
Assistant U.S. Attorney Cyndee Peterson prosecuted the case, which was investigated by Homeland Security Investigations and the Flathead County Sheriff’s Office.
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Sacramento Man Arrested in Oklahoma for Mailing Interstate Threats, Some Containing White PowderRead the Press Release
SACRAMENTO, Calif. — Darnell Ray Owens, 32, of Sacramento, was arrested March 22 in Tulsa, Oklahoma, after being charged in Sacramento with mailing threatening communications and a hoax involving biological weapons, U.S. Attorney McGregor W. Scott announced.
According to the criminal complaint, between February 2018 and March 2019, Owens allegedly sent approximately 50 letters and online complaints to law enforcement agencies, individuals and organizations, in which he made threats to kill police officers, other government officials, homosexuals, and “white people.” He used return addresses of people he knew with the apparent purpose of having others blamed for sending the letters. Owens allegedly mailed no less than two letters containing a white powder, intending that the recipients would believe the powder to be a biological weapon. The majority of the letters were sent via the U.S. Postal Service and were postmarked from Sacramento.
According to the criminal complaint, in July 2018, one of the letters containing white powder was sent to a church in Dallas, Texas with a threat to assassinate the pastor. On August 3, 2018, the Sacramento County Department of Revenue Recovery received a letter containing white powder, and the letter threatened to burn down the department and kill “a lot of people.” On October 24, 2018, a television news station, KTXL Fox40 received a letter threatening to kill certain employees at the station. The last letter Owens allegedly sent was to the Sacramento County District Attorney, threatening her life.
This case is the product of an ongoing investigation by the Federal Bureau of Investigation, the U.S. Postal Inspection Service, and the City of Sacramento Police Department. Assistant U.S. Attorney Shea J. Kenny is prosecuting the case.
If convicted, Owens faces a maximum statutory penalty of five years in prison for each count. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Roanoke Woman Sentenced to 51 Months in PrisonRead the Press Release
FORT WAYNE – Marianne Matchette, 52 years old, formerly of Roanoke, Indiana, was sentenced by U.S. District Court Chief Judge Theresa L. Springmann after pleading guilty to Mail Fraud and Aggravated Identity Theft, announced U.S. Attorney Kirsch.
Ms. Matchette was sentenced to 51 months in prison followed by 1 year of supervised release. Ms. Matchette was ordered to pay $126,705.09 in restitution to the victims of her offenses.
According to documents in the case, Ms. Matchette was given access to a company credit card issued in her name to make purchases authorized by the company and was also given access to the President/CEO’s company and personal credit cards. From May 12, 2015 through June 18, 2015, Ms. Matchette devised and participated in a scheme to defraud the company, by using a credit card without authorization to make personal purchases at a retail establishment, and in so doing caused items to be delivered by private or commercial interstate carriers. In executing her scheme to defraud, Ms. Matchette used the identification of another person.
This investigation was conducted by the FBI’s Financial Crimes Task Force with the assistance of the Indiana State Police and Allen County Sheriff’s Department. The case was handled by Assistant U. S. Attorneys Stacey R. Speith and Tina L. Nommay.
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Press Conference AdvisoryRead the Press Release
There will be a press conference today at 2:30 p.m. to announce charges against attorney Michael Avenatti for attempting to extract more than $20 million in payments from a publicly traded company by threatening to use his ability to garner publicity to inflict substantial financial and reputational harm on the company if his demands were not met. The press conference will be livestreamed on Facebook @USAOSDNY. Relevant documents are attached.
WHO: Geoffrey S. Berman, United States Attorney for the Southern District of New York
William F. Sweeney, Assistant Director-in-Charge of the New York Office of the Federal Bureau of Investigation
WHAT: Press Conference
WHEN: Monday, March 25, 2019 at 2:30 p.m.
WHERE: U.S. Attorney’s Office, Southern District of New York
1 St. Andrew’s Plaza
New York, NY 10007
CONTACT: James Margolin, Nicholas Biase, Dawn Dearden
(212) 637-2600
NOTE: Due to construction/renovation of the lobby-level entrance, entry is through the ground floor parking-level entrance. Please allow extra time for entry and screening. Please silence all cell phones, PDAs, and pagers before start of press conference.
Pennsylvania Department of Education Agrees to Resolve Federal Civil Rights Investigation into Complaints About Alternative Education ProgramsRead the Press Release
The Department of Justice’s Civil Rights Division and the United States Attorney’s Offices for the Western, Middle, and Eastern Districts of Pennsylvania today announced a settlement agreement with the Pennsylvania Department of Education (PDE) to resolve a federal civil rights investigation into complaints about PDE’s statewide system of alternative education programs, known as Alternative Education for Disruptive Youth (AEDY).
"All students should be provided an opportunity to succeed and are entitled to learn in an educational environment free from discrimination,” said Assistant Attorney General Eric Dreiband of the Civil Rights Division. “We commend PDE’s cooperation throughout our investigation and for its commitment to ensure that students with disabilities and English learners are not prevented from learning opportunities afforded to other students. All students should receive the lawfully-required help they need to participate equally in schools.”
“Pennsylvania must ensure that children with disabilities are not placed in an alternative disciplinary program simply because they have a disability,” said United States Attorney Freed. “We applaud the Commonwealth of Pennsylvania for implementing numerous changes to its AEDY Programs already, which, coupled with this agreement, will improve the education of children with disabilities and give all children the opportunity to learn English in AEDY Programs.”
“Federal law does not allow schools to discipline students because of their disability, or to deprive them of an opportunity to learn English,” said United States Attorney William M. McSwain when announcing the resolution for the Eastern District of Pennsylvania. “This agreement protects their civil rights, and comes with laudable cooperation by the Commonwealth of Pennsylvania.”
The investigation was conducted under Title II of the Americans with Disabilities Act, which prohibits state and local government entities, including public schools, from discriminating based on disability. In addition, the Justice Department investigated under the Equal Educational Opportunities Act of 1974, which prohibits a state from denying equal educational opportunity based on national origin by failing to take appropriate action to overcome language barriers that impede equal participation by students in an instructional program.
Under the settlement agreement, PDE will monitor the AEDY system to ensure that students are not placed in AEDY in a manner that discriminates based on disability; that they are not denied equal educational opportunities; and that students with disabilities are transferred back to their home schools in a timely manner. In addition, the agreement will require Pennsylvania to ensure that local educational agencies provide appropriate language assistance services to English Learner (EL) students. The United States will monitor compliance with the terms of the agreement.
Additional information about the Civil Rights Division of the Justice Department is available on its website at www.justice.gov/crt.
Pennsylvania Department of Education Agrees to Resolve Federal Civil Rights Investigation into Alternative Education ProgramsRead the Press Release
PHILADELPHIA – The U.S. Attorney’s Offices for the Eastern, Middle, and Western Districts of Pennsylvania announced jointly today that the Pennsylvania Department of Education (PDE) has agreed to resolve a federal civil rights investigation into its statewide system of alternative education programs, known as Alternative Education for Disruptive Youth. Under Pennsylvania law, students in grades 6 through 12 can be referred to these programs for temporary placements when they meet statutory criteria. These programs are separate from students’ usual general education programs, and do not typically offer the same access to instructional programs or activities.
The United States Department of Justice received complaints that these alternative education programs discriminated against students based on disability and failed to provide appropriate services to students who are learning English as a second language. In response, the Department of Justice investigated PDE’s approval and oversight of these programs across Pennsylvania.
The federal investigation arose under Title II of the Americans with Disabilities Act, which prohibits state and local government entities, including public schools, from discriminating based on disability. In addition, the Equal Educational Opportunities Act of 1974 prohibits a state from denying equal educational opportunity based on national origin by failing to take appropriate action to overcome language barriers that impede equal participation by its students in an instructional program.
Under the settlement agreement, PDE will take measures designed to remedy the complaints. The agreement requires PDE to ensure that students with disabilities receive individual assessments to determine whether they are being placed in alternative education programs because of their disability. The agreement also requires PDE to monitor whether these programs have timely transferred students with disabilities back to their home schools. In addition, the agreement requires PDE to guarantee that local educational agencies attempt appropriate interventions before referring students with disabilities to alternative education programs, and to ensure that students are not placed in these programs solely because of disability.
The agreement will also require PDE to ensure that local educational agencies establish a service plan for students who are learning English in alternative education programs to ensure that they receive appropriate language assistance services. PDE will also improve its process for receiving and responding to complaints from parents or others regarding alternative education programs, and revise its non-discrimination policies and data monitoring practices to comply with federal law.
“Federal law does not allow schools to discipline students because of their disability, or to deprive them of an opportunity to learn English,” said United States Attorney William M. McSwain when announcing the resolution for the Eastern District of Pennsylvania. “This agreement protects their civil rights, and comes with laudable cooperation by the Commonwealth of Pennsylvania.”
“Pennsylvania must ensure that children with disabilities are not placed in an alternative disciplinary program simply because they have a disability,” said David J. Freed, United States Attorney for the Middle District of Pennsylvania. “We applaud the Commonwealth of Pennsylvania for implementing numerous changes to its AEDY Programs already, which, coupled with this agreement, will improve the education of children with disabilities and give all children the opportunity to learn English in AEDY Programs.”
“All students should be provided an opportunity to succeed and are entitled to learn in an educational environment free from discrimination,” said Assistant Attorney General Eric Dreiband of the Civil Rights Division. “We commend PDE’s cooperation throughout our investigation and for its commitment to ensure that students with disabilities and English learners are not prevented from learning opportunities afforded to other students. All students should receive the lawfully-required help they need to participate equally in schools.”
Assistant U.S. Attorney Michael S. Macko handled the case, working jointly with the Department of Justice’s Civil Rights Division and with Assistant U.S. Attorneys Michael Butler and Jennifer Andrade from the Middle and Western Districts of Pennsylvania, respectively.
Pennsylvania Department of Education Agrees to Resolve Federal Civil Rights Investigation into Alternative Education Programs and Implement ReformsRead the Press Release
HARRISBURG - The United States Attorney’s Office for the Middle, Eastern, and Western Districts of Pennsylvania announced that the Pennsylvania Department of Education (PDE) has agreed to resolve a federal civil rights investigation into Pennsylvania’s system of alternative education programs, known as Alternative Education for Disruptive Youth (AEDY). Under Pennsylvania law, students in grades 6 through 12 can be referred to these programs for temporary placements when they meet certain statutory criteria. These programs are separate from students’ usual general education programs, and do not typically offer the same access to the instructional programs or activities.
According to United States Attorney David J. Freed, the United States Department of Justice received complaints that AEDY programs discriminated against students based on disability and failed to provide appropriate services to students who are learning English. In response, the Department of Justice partnered with United States Attorney’s Offices for the Middle, Eastern, and Western District of Pennsylvania to investigate PDE’s approval and oversight of these programs across Pennsylvania.
The investigation was conducted under Title II of the Americans with Disabilities Act, which prohibits state and local government entities, including schools, from discriminating based on disability. In addition, the Equal Educational Opportunities Act of 1974 prohibits a state from denying equal educational opportunity based on national origin by failing to take appropriate action to overcome language barriers that impede equal participation by its students in an instructional program.
Under the settlement agreement, PDE will ensure that students with disabilities receive individual assessments to determine whether their behavior results from a disability before they are placed in AEDY. The agreement also requires PDE to monitor whether students with disabilities in AEDY programs are timely transferred back to their home schools, guarantee that local educational agencies attempt appropriate interventions before referring students with disabilities to AEDY, and ensure that students are not placed in AEDY solely on the basis of disability.
In addition, the agreement will require Pennsylvania to ensure that local educational agencies establish a service plan for English learning (EL) students in AEDY to ensure that they receive appropriate language assistance services. PDE will also improve its process for receiving and responding to complaints from parents or others regarding AEDY programs, and revise its non-discrimination policies and data monitoring practices to comply with the EEOA and the ADA.
“Pennsylvania must ensure that children with disabilities are not placed in an alternative disciplinary program simply because they have a disability,” said United States Attorney Freed. “We applaud the Commonwealth of Pennsylvania for implementing numerous changes to its AEDY Programs already, which, coupled with this agreement, will improve the education of children with disabilities and give all children the opportunity to learn English in AEDY Programs.”
“Federal law does not allow schools to discipline students because of their disability, or to deprive them of an opportunity to learn English,” said United States Attorney William M. McSwain when announcing the resolution for the Eastern District of Pennsylvania. “This agreement protects their civil rights, and comes with laudable cooperation by the Commonwealth of Pennsylvania.”
“All students should be provided an opportunity to succeed and are entitled to learn in an educational environment free from discrimination,” said Assistant Attorney General Eric Dreiband of the Civil Rights Division. “We commend PDE’s cooperation throughout our investigation and for its commitment to ensure that students with disabilities and English learners are not prevented from learning opportunities afforded to other students. All students should receive the lawfully-required help they need to participate equally in schools.”
This case was handled by Assistant United States Attorneys Michael J. Butler, MDPA, Michael S. Macko, EDPA, and Jennifer Andrade, WDPA, working jointly with the Department of Justice’s Education and Opportunities Section of the Civil Rights Division.
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Patrick Ho, Former Head of Organization Backed by Chinese Energy Conglomerate, Sentenced to 3 Years in Prison for International Bribery and Money Laundering OffensesRead the Press Release
Geoffrey S. Berman, United States Attorney for the Southern District of New York, and Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, announced that CHI PING PATRICK HO, a/k/a “Patrick C.P. Ho,” a/k/a “He Zhiping,” was sentenced today to three years in prison for his role in a multi-year, multimillion-dollar scheme to bribe top officials of Chad and Uganda in exchange for business advantages for CEFC China Energy Company Limited (“CEFC China”). HO was convicted of violations of the Foreign Corrupt Practices Act (“FCPA”), money laundering, and conspiracy to commit the same, in December 2018, after a one-week jury trial before U.S. District Judge Loretta A. Preska, who imposed today’s sentence.
Manhattan U.S. Attorney Geoffrey S. Berman stated: “Patrick Ho schemed to bribe the leaders of Chad and Uganda in order to secure unfair business advantages for the Chinese energy company he served. His actions were brazen, including offering the president of Chad $2 million in cash, hidden in gift boxes. Foreign corruption undermines the fairness of international markets, erodes the public’s faith in its leaders, and is deeply unfair to the people and businesses that play by the rules. Today’s sentence recognizes the severe harm caused by Ho’s actions.”
Assistant Attorney General Brian A. Benczkowski stated: “Patrick Ho bribed officials at the highest levels of government in Chad and Uganda in pursuit of lucrative oil deals and other business opportunities, all while using a U.S.-based NGO to conceal his criminal scheme. This kind of corruption undermines world markets and tilts the playing field against law-abiding companies and individuals. The Department will continue to investigate and prosecute individuals and corporations that engage in foreign bribery.”
According to the Indictment, evidence presented at trial, information presented in connection with sentencing, and other publicly available materials:
Overview
HO orchestrated and executed two bribery schemes to pay top officials of Chad and Uganda in exchange for business advantages for CEFC China, a Shanghai-based multibillion-dollar conglomerate that operates internationally in multiple sectors, including oil, gas, and banking. At the center of both schemes was HO, the secretary-general of a non-governmental organization based in Hong Kong and Arlington, Virginia, and registered as a charitable entity in the United States, the China Energy Fund Committee (“CEFC NGO”), which held “Special Consultative Status” with the United Nations (“UN”) Economic and Social Council. CEFC NGO was funded by CEFC China.
In the first scheme (the “Chad Scheme”), HO, on behalf of CEFC China, offered a $2 million cash bribe, hidden within gift boxes, to Idriss Déby, the president of Chad, in an effort to obtain valuable oil rights from the Chadian government. In the second scheme (the “Uganda Scheme”), HO caused a $500,000 bribe to be paid, via wires transmitted through New York, New York, to an account designated by Sam Kutesa, the Minister of Foreign Affairs of Uganda, who had recently completed his term as the president of the UN General Assembly. HO also schemed to pay a $500,000 cash bribe to Yoweri Museveni, the president of Uganda, and offered to provide both Kutesa and Museveni with additional corrupt benefits by “partnering” with them and their families in future joint ventures in Uganda.
The Chad Scheme
The Chad Scheme began in or about September 2014 when HO flew into New York to attend the annual UN General Assembly. At that time, CEFC China – a multibillion-dollar energy company based in Shanghai, China – was working to expand its operations to Chad, and wanted to meet with President Déby as quickly as possible. Through a connection, HO was introduced to Cheikh Gadio, the former Minister of Foreign Affairs of Senegal, who had a personal relationship with President Déby. HO and Gadio met at CEFC China’s suite at Trump World Tower in midtown Manhattan, where HO enlisted Gadio to assist CEFC China in obtaining access to President Déby.
Gadio connected HO and CEFC China to President Déby. In an initial meeting in Chad in November 2014, President Déby described to HO and CEFC China executives certain lucrative oil rights that were available for CEFC China to acquire. Following that meeting, Gadio advised HO and CEFC China to send a technical team to Chad to investigate the oil rights and make an offer to President Déby grounded in factual data. Instead, HO insisted on a prompt second meeting with President Déby. The second meeting took place a few weeks later, in December 2014. HO led a CEFC China delegation, which flew to Chad on a corporate jet with $2 million cash concealed within several gift boxes. At the conclusion of a business meeting with President Déby, HO and the CEFC China executives presented him with the gift boxes.
To the surprise of HO and the CEFC China executives, President Déby rejected the $2 million bribe offer, but later agreed to accept the money as a charitable donation to the country. HO subsequently drafted a letter to President Déby falsely claiming that the cash had really been intended as a donation to the people of Chad all along.
HO and CEFC China did not obtain the unfair advantage that they had sought through the bribe offer, and by mid-2015, HO had turned his attention to a different so-called “gateway to Africa”: Uganda.
The Uganda Scheme
The Uganda Scheme began around the same time as the Chad Scheme, when HO was in New York for the annual UN General Assembly. HO met with Sam Kutesa, who had recently begun his term as the 69th president of the UN General Assembly (“PGA”). HO, purporting to act on behalf of CEFC NGO, met with Kutesa and began to cultivate a relationship with him. During the year when Kutesa served as PGA, HO and Kutesa discussed a “strategic partnership” between Uganda and CEFC China for various business ventures, to be formed once Kutesa returned to Uganda.
In or about February 2016 – after Kutesa had returned to Uganda and resumed his role as Foreign Minister, and Yoweri Museveni (Kutesa’s relative) had been reelected as the president of Uganda – Kutesa solicited a payment from HO, purportedly for a charitable foundation that Kutesa wished to launch. HO agreed to provide the requested payment, but simultaneously requested, on behalf of CEFC China, an invitation to Museveni’s inauguration, business meetings with Museveni and other high-level Ugandan officials, and a list of specific business projects in Uganda in which CEFC China could participate.
In May 2016, HO and CEFC China executives traveled to Uganda. Prior to departing, HO caused CEFC NGO to wire $500,000 to the account provided by Kutesa in the name of the so-called “foundation,” which wire was transmitted through New York, New York. HO also advised his boss, Ye Jianming, the then-chairman of CEFC China, to provide $500,000 in cash to Museveni, ostensibly as a campaign donation, even though Museveni had already been reelected. HO intended these payments to influence Kutesa and Museveni to use their official power to steer business advantages to CEFC China.
HO and CEFC China executives attended President Museveni’s inauguration and obtained business meetings in Uganda with Museveni and top Ugandan officials, including with the Department of Energy and Mineral Resources. After the trip, HO requested that Kutesa and Museveni assist CEFC China in acquiring a Ugandan bank, as an initial step before pursuing additional ventures in Uganda. HO also offered to “partner” with Kutesa and Museveni and/or their “family businesses,” making clear that both officials would share in CEFC China’s future profits. In exchange for the bribes offered and paid by HO, Kutesa thereafter steered a bank acquisition opportunity to CEFC China.
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In imposing sentence, Judge Preska explained that, as the UN Convention Against Corruption states: “Corruption is an insidious plague” that is “found in all countries—big and small, rich and poor—but it is in the developing world that its effects are most destructive.”
In addition to his prison term, HO, 69, a citizen of the People’s Republic of China who resided in Hong Kong prior to his arrest in November 2017 and has been detained since his arrest, was fined $400,000.
Mr. Berman and Mr. Benczkowski praised the outstanding work of the Federal Bureau of Investigation and Internal Revenue Service-Criminal Investigation. He also thanked the Department of Homeland Security, Homeland Security Investigations, and the Department of Justice, Criminal Division’s Office of International Affairs, for their assistance.
This case is being prosecuted by the Office’s Public Corruption Unit and the Criminal Division’s Fraud Section, FCPA Unit. Assistant U.S. Attorneys Daniel C. Richenthal, Douglas S. Zolkind, and Catherine E. Ghosh, and Trial Attorney Paul A. Hayden of the Fraud Section, are in charge of the prosecution.
Passing of Senior United States District Judge James C. FoxRead the Press Release
RALEIGH – Robert J. Higdon, Jr., United States Attorney for the Eastern District of North Carolina, issued the following statement upon the passing of Judge James C. Fox:
“It is with a heavy heart that the men and women of the United States Attorney’s Office for the Eastern District acknowledge the death of former United States District Judge James C. Fox.
Judge Fox, a graduate of the University of North Carolina and the UNC School of Law, was appointed as a United States District Judge for the Eastern District in 1982 by President Ronald Regan. He served more than 35 years on the bench, until his retirement in 2017.
Over the years of his service on the bench, federal prosecutors in this district knew Judge Fox to be a keen student of the law, and dedicated to its firm and fair enforcement. He expected the highest standards of ethics and professionalism in his court and any attorney who appeared before him was the better for the experience. He deeply loved the people and places in the Eastern District and worked hard to ensure their business was well-handled in federal court. He will be greatly missed.
Our deepest respect and gratitude go to Judge Fox. And, we will keep Judge Fox’s family in our thoughts and prayers.”
Ohio County man admits to child pornography chargeRead the Press Release
WHEELING, WEST VIRGINIA – Kirk Grubler, of Wheeling, West Virginia, has admitted to possessing child pornography, United States Attorney Bill Powell announced.
Grubler, age 37, pled guilty to one count of “Possession of Child Pornography.” Grubler admitted to having images of child pornography depicting a child under the age of 12 in April 2017 in Ohio County.
Grubler faces up to 20 years incarceration and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Stephen L. Vogrin is prosecuting the case on behalf of the government. The U.S. Department of Homeland Security Investigations investigated.
U.S. Magistrate Judge James P. Mazzone presided.
Nigerian Business E-mail Scammer Sentenced for FraudRead the Press Release
United States Attorney Joe Kelly announced that Pelumi Fawehinmi, age 38, of Nigeria, was sentenced Friday, March 22, 2019, for Wire Fraud. United States District Court Judge Robert F. Rossiter, Jr., sentenced Fawehinmi to a 72-month term of imprisonment. After his release from prison, Fawehinmi will begin a 3-year term of supervised release. The restitution amount is to be determined and will be ordered at a later date.
Fawehinmi was a key part of a scheme commonly referred to as business e-mail compromise. Fawehinmi provided bank accounts to other co-conspirators who were working directly with businesses to defraud them. In this scheme, co-conspirators used compromised e-mail accounts to send spoofed e-mails to thousands of business employees across the United States who had accounting responsibilities, to include authorizing and sending wire transfers. A spoofed e-mail is one in which the e-mail appears to be originating from a sender other than the person who is truly the sender. Fawehinmi’s co-conspirators posed as Chief Executive Officers or other business executives and would direct recipients of the spoofed e-mails to complete wire transfers. The business employees, thinking that the wire transfer requests were legitimate, would comply with the wire transfer requests and wire money to the location designated in the written instructions. One of Fawehinmi’s co-conspirators, Adewale Aniyeloye, was sentenced to 96 months by Judge Rossiter in February of 2019.
The scheme was primarily conducted from Nigeria where Fawehinmi was living. In 2017, investigators learned Fawehinmi was planning to travel to the United States. He was arrested upon his arrival in New York. Pursuant to this scheme, businesses, including businesses in the District of Nebraska, lost more than $6 million. The attempted losses pursuant to the scheme are more than $30 million. The two Nebraska victims of the fraud scheme lost approximately $163,230.
This case was investigated by the Federal Bureau of Investigation.
New Mexico Man Charged with Failure to Pay Child SupportRead the Press Release
United States Attorney Ron Parsons announced that an Ocoma, New Mexico, man has been indicted by a federal grand jury for Failure to Pay Child Support.
Joseph A. Mesteth, age 50, was indicted on December 4, 2018. He appeared before U.S. Magistrate Judge Veronica L. Duffy on March 20, 2019, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 4 years in federal prison and/or a $500,000 fine, 2 years of supervised release, and up to $200 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on from October 1, 2005, and continuing to the present, and from October 1, 2006, and continuing to the present, Mesteth, while residing in a different state with respect to his three children who reside in South Dakota, willfully and unlawfully failed to pay a past due support obligation as ordered in an amount greater than $10,000.00.
The charges are merely accusations and Mesteth is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Office of the Inspector General. Assistant U.S. Attorney Ann M. Hoffman is prosecuting the case.
Mesteth was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
Monroe County Woman Guilty of Participating in Sex Trafficking Conspiracy and Drug TraffickingRead the Press Release
SCRANTON—The United States Attorney’s Office for the Middle District of Pennsylvania announced that Jordan Capone, age 24, of Mt. Pocono, pleaded guilty on March 22, 2019, before U.S. District Court Judge Malachy E. Mannion, to participating in a sex trafficking conspiracy that involved using threats and coercion to force women to engage in prostitution in the Monroe County area between 2011 and 2014. Capone also pleaded guilty to possession with intent to distribute the drug “molly,” a form of MDMA.
According to United States Attorney David J. Freed, Capone admitted to being a member of the Black P-Stones, a street gang that engaged in sex trafficking and drug trafficking in the Stroudsburg area and the state of Maine. Members of the conspiracy advertised prostitutes on websites, transported the prostitutes, and rented hotel and motel rooms for the purpose of having the women engage in commercial sex acts with customers.
The prostitutes were threatened, physically assaulted, and provided drugs, including heroin, by members of the conspiracy to persuade them to engage or continue to engage in prostitution. Virtually all of the money earned by the prostitutes was turned over to the gang leaders, and the prostitutes were compensated with illegal drugs.
Capone admitted to selling “molly” between 2013 and 2017.
Judge Mannion ordered a pre-sentence investigation to be completed. Sentencing for Capone will be scheduled at a later date.
Capone was indicted along with others by a federal grand jury, as a result of an investigation by agents of the Federal Bureau of Investigation, investigators from the Pennsylvania State Police, Maine State Police, the Monroe County District Attorney’s Office, and local police in Monroe County. Assistant U.S. Attorneys Francis P. Sempa and Phillip Caraballo are prosecuting the case.
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.
This case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.
This case was also brought as part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions has made turning the tide of rising violent crime in America a top priority. In October 2017, as part of a series of actions to address this crime trend, Attorney General Sessions announced the reinvigoration of PSN and directed all U.S. Attorney’s Offices to develop a district crime reduction strategy that incorporates the lessons learned since PSN launched in 2001.
The maximum penalty under federal law for these offenses is life imprisonment, a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Mobridge Man Charged with Conspiracy to Distribute MethamphetamineRead the Press Release
United States Attorney Ron Parsons announced that a Mobridge, South Dakota, man has been indicted by a federal grand jury for Conspiracy to Distribute Methamphetamine.
Waylon Laframboise, age 41, was indicted on February 13, 2019. He appeared before U.S. Magistrate Judge Mark A. Moreno on March 19, 2019, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 40 years in federal prison and/or a $5,000,000 fine, up to life of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that between February 1, 2014, and January 1, 2015, Laframboise knowingly and intentionally conspired to distribute and possess with intent to distribute 50 grams or more of methamphetamine.
The charge is merely an accusation and Laframboise is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Northern Plains Safe Trails Drug Enforcement Task Force. Assistant U.S. Attorney Cameron J. Cook is prosecuting the case.
Laframboise was released on bond pending trial. A trial date has not been set.
Mobile County Man Sentenced to 37 Months for Possession of a Firearm After Felony ConvictionRead the Press Release
United States Attorney Richard W. Moore of the Southern District of Alabama announced that Jabrandon S. Lovett, a 28 year old resident of Mobile, Alabama was sentenced to 37 months of incarceration for possession of a Smith & Wesson .38 caliber revolver after a 2013 Burglary 3rd conviction and a 2010 Robbery 2nd conviction.
On November 19, 2018, Lovett entered a guilty plea and admitted in open court that on July 8, 2018, at approximately 9:45pm, Mobile County, AL deputies observed Lovett driving a vehicle that did not display a tag light, so they conducted a traffic stop. As the deputies approached the vehicle, they smelled marijuana and counted four people in the vehicle. Deputies asked for and received Lovett’s driver’s license. Next, all four vehicle occupants were asked to exit the vehicle and they did. A probable cause search of the vehicle for illegal drugs was conducted and no illegal drugs were found. The passengers then told the deputies that they had smoked marijuana in the vehicle earlier but they no longer possessed any marijuana.
During the search, deputies found and opened a canvas strap bag that was around Lovett’s neck when the vehicle was stopped, but that Lovett removed and left inside the vehicle when he exited. Inside the bag was a loaded Smith & Wesson, .38 caliber revolver, serial number 134942 that was not manufactured in Alabama.
On July 23, 2018, Lovett confessed to possessing the firearm. He stated that he bought the revolver approximately two years before and had if for protection but only fired it one time. At that time Lovett had been convicted of two felonies, namely, Robbery 2nd Degree, on September 29, 2010, in the Circuit Court of Mobile County, Alabama, case number CC-10-1529 and Burglary 3rd Degree on October 2, 2013, in the Circuit Court of Mobile County, Alabama, case number CC-13-2483.
Deputies of the Mobile County Sheriff’s Office and special agents of the FBI investigated the case and brought it to the U. S. Attorney=s Office for prosecution. The prosecutor assigned to the case is Assistant United States Attorney, Gina S. Vann.
Mobile County Man Sentenced to 24 Months for Conspiring to Steal and to Knowingly Possess Stolen FirearmsRead the Press Release
United States Attorney Richard W. Moore of the Southern District of Alabama announced that Tyler McIlwain, a 20 year old resident of Eight Mile, Alabama was sentenced to 24 months of incarceration for conspiring to steal and knowingly possess stolen firearms.
On November 29, 2018, McIlwain entered a guilty plea pursuant to a plea agreement and admitted in open court that on July 5, 2018, McIlwain and a cohort burglarized a home in Creola, Alabama. During the burglary they stole four (4) firearms, namely, an Anderson, .30 caliber rifle, model 300 Blackout; an Anderson, .223 caliber rifle; an Anderson, .30 caliber rifle; and a Marlin, .22 caliber rifle.
Shortly after the burglary, a Creola police officer attempted to stop a red Nissan truck, registered to McIlwain, for speeding. First the driver of the Nissan truck tried to flee by speeding up and attempting to elude the police following behind. Next, the Nissan truck stopped and the three occupants inside jumped out and ran. Two of the occupants were caught and one got away. McIlwain and one other were caught. All of the stolen firearms were recovered from the Nissan truck. After waiving his Miranda Rights, McIlwain stated that he and a cohort burglarized the residence and stole the firearms. He also stated that the other person in his vehicle was not involved.
Officers of the Creola, Alabama Police Department, deputies of the Mobile County Sheriff’s Office and special agents of the FBI investigated the case and brought it to the U. S. Attorney=s Office for prosecution. The prosecutor assigned to the case is Assistant United States Attorney Gina S. Vann.
Michigan man admits to role in a drug distribution operation in Monongalia CountyRead the Press Release
CLARKSBURG, WEST VIRGINIA – Darius Dunbar, of Southfield, Michigan, has admitted to his involvement in a heroin, oxycodone, and cocaine distribution operation, United States Attorney Bill Powell announced.
Dunbar, age 25, pled guilty to one count of “Aiding and Abetting Distribution of Heroin.” Dunbar admitted to selling heroin in July 2017 in Monongalia County.Dunbar faces up to 20 years incarceration and a fine of up to $1,000,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Zelda E. Wesley is prosecuting the case on behalf of the government. The Drug Enforcement Administration, the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Mon Metro Drug & Violent Crimes Task Force, a HIDTA-funded initiative, investigated. The United States Marshal Service assisted.
The investigation was funded in part by the federal Organized Crime Drug Enforcement Task Force Program (OCDETF). The OCDETF program supplies critical federal funding and coordination that allows federal and state agencies to work together to successfully identify, investigate, and prosecute major interstate and international drug trafficking organizations and other criminal enterprises.
U.S. Magistrate Judge Michael John Aloi presided.
Mexican Man Pleads Guilty to Illegal Re-EntryRead the Press Release
NEW ORLEANS, LOUISIANA – United States Attorney Peter G. Strasser announced that RICARDO SALAZAR-ESQUIVEL, age 30, a native of Mexico, plead guilty Thursday, March 21, 2019 to a one-count indictment, which charged him with illegal reentry of a removed alien, in violation of Title 18, United States Code, Section 1326(a).
According to the indictment, SALAZAR-ESQUIVEL was previously removed from the United States on July 9, 2008. He was later found in the Eastern District of Louisiana on September 16, 2008 and had not received permission from the Attorney General of the United States or the Secretary of the Department of Homeland Security to reenter. He is set to be sentenced on May 2, 2019.
SALAZAR-ESQUIVEL faces a maximum term of imprisonment of 2 years, a fine of $250,000, one year of supervised release, and a $100 special assessment fee.
U.S. Attorney Strasser praised the work of the United States Immigration and Customs Enforcement agency in investigating this matter. Assistant United States Attorney Carter K.D. Guice, Jr. is in charge of the prosecution.
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Metairie Man Charged with Violations of the Federal Gun Control and National Firearms ActsRead the Press Release
NEW ORLEANS – United States Attorney Peter G. Strasser announced Thursday, March 21, 2019 that a federal grand jury returned a three-count indictment against defendant DAVID HUNTER, of Metairie, for possession of stolen firearms in violation of 18 U.S.C. § 922(j) (Count 1), being a prohibited person under indictment in possession of firearms in violation of 18 U.S.C.§ 922(n) (Count 2); and possession of a suppressor not registered to him in the National Firearms Registration and Transfer Record in violation to 26 U.S.C. § 5861(d). For Count 1, HUNTER faces a maximum term of imprisonment of ten years and a $250,000 fine. For Count 2, HUNTER faces a maximum term of imprisonment of five years and a $250,000 fine. For Count 3, HUNTER faces a maximum term of imprisonment of ten years and a $10,000 fine. For each of the charged counts, HUNTER faces up to three years supervised release following any term of imprisonment and a $100 special assessment fee.
The indictment alleges that in December of 2016, HUNTER stole a gun safe containing various firearms from a location in Tylertown, Mississippi and transported the firearms to the Eastern District of Louisiana.
An indictment is merely an accusation. The defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
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.
This matter was handled by the Bureau of Alcohol, Tobacco, Firearms and Explosives along with the Louisiana State Police. Assistant United States Attorney Duane A. Evans is prosecuting the case.
Members of International Drug Trafficking Conspiracy Plead GuiltyRead the Press Release
Three members of an international drug trafficking organization pleaded guilty today in U.S. District Court in Seattle to distributing more than a thousand kilograms of illegal marijuana, announced U.S. Attorney Brian T. Moran. The defendants admit in their plea agreements that they used money from conspirators in the Peoples Republic of China (PRC) to purchase homes in the Puget Sound area that they used for marijuana production. QIFENG LI, 41, his wife XIAMIN HUANG, 38, and brother QIWEI LI, 45, all face a mandatory minimum five years in prison and up to 40 years in prison when sentenced by U.S. District Judge John C. Coughenour on June 18, 2019.
“The entry of organized crime into the marijuana marketplace is of increasing concern in the Western District of Washington,” said U.S. Attorney Brian T. Moran. “This conduct brings crime to our neighborhoods, artificially fuels the housing market, and creates a blight of toxic abandoned grow houses. With this case, the defendants are forfeiting more than a million dollars of equity in properties and more than $350,000 in cash – putting a dent in the organized crime profits.”
According to the facts admitted in the plea agreement, between July 2015 and May 2018, the conspirators purchased homes in Burien, Kent, Seattle and Tukwila, which they used exclusively for marijuana production. More than $598,000 was wired to the conspirators from China to fund the purchases. The defendants shipped more than 1,000 kilograms of marijuana to the New York City area, via FedEx, UPS, the U.S. Postal Service and a private freight forwarder. Ultimately, in an effort to streamline distribution the conspirators established a shipping company, Pony Movers, LLC, to transport their marijuana from Western Washington to a warehouse in Little Ferry, New Jersey. The defendants then deposited the profits from the marijuana enterprise into their bank accounts in amounts less than $10,000 to avoid financial reporting requirements.
QIFENG LI and XIAMIN HUANG are U.S. citizens. QIWEI LI is a Lawful Permanent Resident who likely will face deportation following his prison term.
This was an Organized Crime and Drug Enforcement Task Force (OCDETF) investigation, providing supplemental federal funding to the federal and state agencies involved.
The Investigation was led by DEA and Homeland Security Investigation (HSI). Significant investigative assistance was also provided by the Seattle Police Department and FBI.
The case is being prosecuted by Special Assistant United States Attorney Joe Silvio and Assistant United States Attorney Marie Dalton. Mr. Silvio is an attorney with Homeland Security Investigations, specially designated to prosecute cases in federal court.
Meadville, Pa. Man Pleads Guilty in Project Safe Childhood CaseRead the Press Release
ERIE, Pa. - A former resident of Meadville, Pennsylvania, pleaded guilty in federal court to charges of violating federal laws relating to the sexual exploitation of children, United States Attorney Scott W. Brady announced today.
Dennis Michael Kerr, 29, pleaded guilty to two counts before United States District Judge David S. Cercone.
In connection with the guilty plea, the court was advised that Kerr transported computer images and movies depicting minors engaging in sexually explicit conduct. Kerr also transferred and attempted to transfer obscene material to an individual Kerr thought was a minor.
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.justice.gov/psc.
Judge Cercone scheduled sentencing for July 15, 2019 at 1:30 p.m. The law provides for a total sentence of 30 years in prison, a fine of $500,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Christian A. Trabold is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation and the Pennsylvania State Police conducted the investigation that led to the prosecution of Kerr.
McLaughlin Man Charged with Kidnapping and AssaultRead the Press Release
United States Attorney Ron Parsons announced that a McLaughlin, South Dakota, man has been indicted by a federal grand jury for Kidnapping, Assault of an Intimate Partner by Strangling, and Assault by an Habitual Offender.
Brandon Ducheneaux, age 44, was indicted on March 12, 2019. He appeared before U.S. Magistrate Judge William D. Gerdes on March 20, 2019, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to life in federal prison and/or a $250,000 fine, 5 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that between March 3, 2016, and March 4, 2016, Ducheneaux kidnapped his intimate partner and assaulted her by strangulation. During the time of the assault, Ducheneaux had at least two prior convictions of assault against a spouse or intimate partner.
The charges are merely accusations and Ducheneaux is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Bureau of Indian Affairs, Standing Rock Agency. Assistant U.S. Attorney Kirsten Jasper is prosecuting the case.
Ducheneaux was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
Mayport Navy Lieutenant Sentenced to 10 Years for Using the Internet to Entice and Meet A Child to Engage in Sexual ActivityRead the Press Release
Jacksonville, Florida – United States District Judge Marcia Morales Howard has sentenced Michael Douglas McNeil (31, Jacksonville) to a term of 10 years in federal prison for using the internet to attempt to entice a child to engage in sexual activity. McNeil was also ordered to serve a 5-year term of supervised release and to register as a sex offender. McNeil is a lieutenant in the U.S. Navy; he has been detained since his arrest on August 30, 2018.
According to court documents, on August 27, 2018, a detective with the Clay County Sheriff’s Office, who was posing online as a family member of a 12-year-old handicapped child, received a message on a social media application from McNeil, who identified himself as “Mark.” McNeil expressed interest in having sex with the “child” and was advised that the “child” was 12 years old. Between August 27 and August 30, 2018, McNeil and the undercover detective discussed plans for McNeil to meet the “child” for sex. McNeil asked for several photos of the “child,” sent the undercover detective an explicit photo of himself, and asked specific questions about the “child’s” sexual experience and abilities. On August 30, 2018, McNeil drove to a coffee shop in Orange Park to meet the “child” for sex and was arrested.
During an interview, McNeil admitted that he had engaged in online and text conversation with the “guardian” of the 12-year-old “child” and that he showed up to meet the “child” because of his “curiosity” about “a younger girl.”
“With the help of HSI’s law enforcement partners at the Clay County Sheriff’s Office, the Jacksonville Sheriff’s Office, and the Naval Criminal Investigative Service, this predator was stopped before he could harm a child,” said HSI Tampa Special Agent in Charge James C. Spero.
This case was investigated by the Clay County Sheriff’s Office, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the Naval Criminal Investigative Service, and the Jacksonville Sheriff’s Office. It was prosecuted by Assistant United States Attorney D. Rodney Brown.
This is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Massachusetts State Trooper Sentenced for Overtime Abuse InvestigationRead the Press Release
BOSTON – A suspended Massachusetts State Police Trooper was sentenced today in federal court in Boston in connection with the ongoing investigation of overtime abuse at the Massachusetts State Police (MSP).
Eric Chin, 46, of Hanover, was sentenced by U.S. District Court Judge Richard G. Stearns to one day in prison, deemed served, and one year of supervised release with three months to be served in home detention. Chin was also ordered to pay restitution in the amount of $7,125. In December 2018, he pleaded guilty to one count of embezzlement from an agency receiving federal funds.
Chin was an MSP Trooper assigned to Troop E, which was responsible for enforcing criminal and traffic regulations along the Massachusetts Turnpike, Interstate I-90. In 2016, Chin earned $302,400, which included approximately $131,653 in overtime pay.
Chin was paid for overtime hours that he did not work and for at least one four-hour shift that he did not work at all. Chin concealed his fraud by submitting fraudulent citations designed to create the appearance that he had worked overtime hours that he had not, and, falsely claimed in MSP paperwork and payroll entries that he had worked the entirety of his overtime shifts.
Chin admitted collecting $7,125 for overtime hours that he did not work.
The overtime in question involved the Accident and Injury Reduction Effort program (AIRE), which was intended to reduce accidents, crashes, and injuries on I-90 through an enhanced presence of MSP Troopers who were to target vehicles traveling at excessive speeds.
Chin is the first Trooper to be sentenced as a result of the ongoing investigation. Thus far, eight MSP troopers have been charged and have pleaded guilty. Seven are awaiting sentencing.
United States Attorney Andrew E. Lelling; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and Douglas Shoemaker, Special Agent in Charge of the U.S. Department of Transportation’s Office of Inspector General made the announcement today. Assistant U.S. Attorneys Dustin Chao and Mark Grady of Lelling’s Public Corruption Unit are prosecuting the cases.
Maryland MS-13 Leader Sentenced to 30 Years in Federal Prison for a Violent Racketeering Conspiracy, Including Planning a MurderRead the Press Release
Greenbelt, Maryland – U.S. District Judge Paula Xinis today sentenced Kevin Henriquez-Chavez, a/k/a “Loco” and “Crazy,” age 24, of Washington Grove, Maryland, to 30 years in federal prison, followed by five years of supervised release, for conspiring to participate in a racketeering enterprise known as La Mara Salvatrucha, or MS-13; and conspiring to use and carry a firearm during a crime of violence.
The sentence was announced by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge Jesse R. Fong of the Drug Enforcement Administration - Washington Field Division; Acting Special Agent in Charge Cardell T. Morant of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI); Chief J. Thomas Manger of the Montgomery County Police Department; Chief Henry P. Stawinski III of the Prince George’s County Police Department; Prince George’s County State’s Attorney Aisha Braveboy; and Montgomery County State’s Attorney John McCarthy.
“Federal, state, and local law enforcement will continue to work together to eradicate the violence perpetrated by MS-13 in Maryland,” said U.S. Attorney Robert K. Hur. “Today’s sentence sends a strong message to MS-13 gang members that their criminal actions cannot, and will not, be tolerated.”
MS-13 is a gang composed primarily of immigrants or descendants of immigrants from El Salvador, with members operating in the State of Maryland, including Montgomery County, Prince George’s County, and Frederick County, and throughout the United States. Branches or “cliques” of MS-13 often work together cooperatively to engage in criminal activity and to assist one another in avoiding detection by law enforcement. In Maryland and the surrounding area, these cliques include Parkview Locos Salvatrucha (“PVLS”), Normandie Locos Salvatrucha (“NLS” or “Normandie”), Sailors Locos Salvatrucha Westside (“SLSW” or “Sailors”), Langley Park Salvatrucha (“LPS”), Weedoms Locos Salvatrucha (“Weedoms”), and Cabanas Locos Salvatruchas (“Cabanas”). MS-13 cliques often combine and work together as “Programs,” with the purpose of increasing the gang’s levels of organization, violence, extortion, and other criminal activity. A person within the participating cliques is selected as the Program leader.
To protect the gang and to enhance its reputation, MS-13 members and associates are expected to use any means necessary to force respect from those who show disrespect, including acts of intimidation and violence. MS-13’s creed is based on one of its mottos, “Mata, roba, viola, controla,” which translates to, “kill, steal, rape, control.”
According to his plea agreement, from 2015 through 2016, Henriquez-Chavez was a member of the Cabanas clique and served as the “First Word” or leader of the clique. Henriquez-Chavez admitted to participating in numerous acts in furtherance of the racketeering conspiracy, including robbery and murder.
As detailed in his plea agreement, Henriquez-Chavez admitted that on November 1, 2015, he and three other MS-13 members and associates were behind an elementary school in Montgomery Village, Maryland, where Victim 3 was also present. Henriquez-Chavez told one of his co-conspirators to get the gun that was maintained by the Cabanas Clique. In order to gain entrance to, maintain, and increase their position in MS-13, the conspirators made a plan to murder Victim 3, whom Henriquez-Chavez and the co-conspirators believed to be a member of the rival 18th Street Gang. Henriquez-Chavez provided instructions that the co-conspirators invite Victim 3 to accompany them into the woods to smoke marijuana and to meet up with a girl on the other side, and told each of the co-conspirators to take a turn shooting Victim 3. Victim 3 agreed to accompany the co-conspirators and was subsequently shot to death.
Co-defendants Jose Augustin Salmeron-Larios, a/k/a “Joseph Morales-Martinez,” “Angel Salvador Gutierrez,” “Yankee,” and “Kean,” age 26, of Severn, Maryland; Noe Coreas-Mejia, a/k/a “Tsunami,” age 22, of Hyattsville, Maryland; and Juan Carlos Espinal-Rapalo, a/k/a “Chiki,” age 21; Daniel Adonai Ramos-Romero, a/k/a “Romero Taylor Binga,” “Taylor Romero,” and “Binga,” age 22; and Oscar Delgado-Perez, a/k/a “Complicado” and “Indio,” age 26, all of Gaithersburg, have all pleaded guilty to the racketeering conspiracy and other charges related to their association with MS-13. They remain detained as they await sentencing.
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. 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.
United States Attorney Robert K. Hur commended the DEA; HSI Baltimore, the Prince George’s County Police Department, the Montgomery County Police Department, the Prince George’s County State’s Attorney’s Office, and the Montgomery County State’s Attorney’s Office for their work in the investigation. Mr. Hur also recognized the Montgomery County and Prince George’s County Departments of Corrections, HSI Baltimore’s Operation Community Shield Task Force, and the Maryland Department of Corrections Intelligence Unit for their assistance. Mr. Hur thanked Assistant United States Attorneys William D. Moomau, Ray D. McKenzie, Catherine K. Dick, and Burden H. Walker who are prosecuting this Organized Crime Drug Enforcement Task Force case.
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Manchester Man Sentenced to More Than 12 Years in Prison for Crimes Stemming from Hartford Car Wash ShootingRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, today announced that on March 22, 2019, HECTOR ALFONSO, 37, of Manchester, was sentenced by U.S. District Judge Janet Bond Arterton in New Haven to 153 months of imprisonment, followed by four years of supervised release, for offenses related to a December 2016 shooting in Hartford’s South End, and for violating the conditions of his supervised release from a prior federal conviction.
According to court documents and statements made in court, at approximately 10:00 p.m. on December 21, 2016, Hartford Police officers responded to a report of a person shot at a car wash located at 156 Franklin Avenue in Hartford. At the car wash, officers encountered an employee of the car wash who was suffering from two gunshot wounds. The victim was transported to the hospital where he was treated for his injuries and released.
The investigation, which included analysis of a surveillance video, revealed that Alfonso arrived at the car wash shortly before the shooting to acquire a distribution quantity of heroin from Ruben Rodriguez and another individual. A dispute and subsequent struggle occurred during the transaction, and Alfonso brandished a firearm. He then shot the employee.
Alfonso was arrested on a federal criminal complaint on May 10, 2017. A search of his Manchester residence on that date revealed cocaine residue on a toilet seat, cocaine and crack cocaine residue in another part of home, and items used to process and package narcotics for street sale. He has been detained since his arrest.
On November 20, 2018, Alfonso pleaded guilty to one count of conspiracy to possess with intent to distribute heroin, and one count of brandishing a firearm during and in relation to a drug trafficking crime.
Alfonso’s criminal history includes a federal conviction for possession with intent to distribute, and distribution of, cocaine base (“crack”). In June 2014, he was sentenced to 18 months of imprisonment and three years of supervised release for that offense.
Judge Arterton sentenced Alfonso to 141 months of imprisonment for the drug and gun offenses, and a consecutive 12 months of imprisonment for violating the conditions of his supervised release that were imposed in 2014.
Rodriguez has been detained since his arrest on September 27, 2017. On that date, a search of his Meriden residence and vehicle revealed a loaded .40 caliber pistol, numerous rounds of ammunition, approximately 133 grams of heroin, approximately 170 grams of cocaine, and $61,909 in cash.
Rodriguez pleaded guilty to drug and firearm offenses on November 9, 2018. On March 21, 2019, he was sentenced to 72 months of imprisonment.
This investigation was conducted by the Federal Bureau of Investigation and the Hartford Police Department. The case was prosecuted by Assistant U.S. Attorney Brian P. Leaming.
This prosecution has been brought through Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make neighborhoods safer for everyone.
Man who Held ATF Undercover Agent and Confidential Informant at Gunpoint Sentenced to 14 Years in PrisonRead the Press Release
One of two men who attempted to rob a federal agent working on an illegal firearms investigation, was sentenced today in U.S. District Court in Seattle to 14 years in prison, announced U.S. Attorney Brian T. Moran. ABDIRASHID HARET, 20, of Des Moines, Washington, pleaded guilty in December 2018, to assault on a federal officer and person assisting a federal officer, using a firearm in a crime of violence and robbery of funds belonging to the United States. At the sentencing hearing U.S. District Judge James L. Robart noted the defendant had a “fascination with guns,” that created “a situation that is dangerous to yourself, the people you are with, and the community.”
“This defendant illegally carried and trafficked firearms, bringing violence to our community,” said U.S. Attorney Brian T. Moran. “He was a convicted felon – arrested for assault and carrying a stolen gun – who returned to crime within months of his juvenile conviction. He threatened an undercover law enforcement agent – the very person we trust to do the dangerous work needed to keep us safe. This long prison sentence is warranted to protect our community.”
According to the facts in the plea agreement, HARET and co-defendant Omar Abdullah, 23, of Seattle, Washington, had made arrangements to sell two firearms to a man who, unknown to them, was a confidential informant (CI) working with ATF. The CI and an undercover ATF agent met with HARET and Abdullah in a vehicle in the parking lot of the Kent Lowe’s store. After the agent and CI got in the car, HARET and Abdullah used the two loaded firearms they brought to the meeting to rob the undercover agent and the CI. The undercover agent told HARET and Abdullah he would get additional money out of his car. HARET followed the agent out of the car, still armed with a firearm. The undercover agent was able to pull his own gun and fired at Abdullah who still held the CI at gunpoint in the car. HARET dropped his gun and attempted to flee. He was struck and injured running across Pacific Highway. Both Abdullah and HARET were taken to medical facilities. Abdullah continues to get specialized treatment for his gunshot wounds.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF).
The case is being prosecuted by Assistant United States Attorney Todd Greenberg.
Man Pleads Guilty to Possessing Firearms in Furtherance of Drug Trafficking CrimesRead the Press Release
St. Louis, MO – Savon Durphey, a/k/a “JRod,” 25, of St. Louis, pled guilty to two counts of possession of a firearm in furtherance of a drug trafficking crime. He appeared in federal court this morning before U.S. District Judge Catherine D. Perry who accepted his plea and set sentencing for July 11, 2019.
According to court documents, on or about October 28, 2016, St. Ann Police attempted to stop a vehicle for speeding. The vehicle failed to stop, and the passenger threw an object from the window. Police retrieved the item and discovered it to be a plastic bag containing approximately 145 capsules. Laboratory tests later confirmed that the capsules contained fentanyl, a dangerous controlled substance. Durphey, the driver of the vehicle, later admitted that he had handed the fentanyl to his 17-year-old passenger and instructed her to throw it out the window. Durphey was discovered to be in possession of a loaded .40 caliber handgun.
On or about March 10, 2017, Durphey again fled from law enforcement; this time, the Ferguson Police Department and the Major Case Squad, who attempted to stop his vehicle. Durphey fled until his vehicle struck a fence and became immobile. Police once again found drugs in Durphey’s vehicle, along with a loaded .45 caliber handgun. Durphey admitted that he was a drug dealer, claiming that he made approximately $800 per day selling drugs.
Durphey faces a mandatory minimum sentence of ten years in prison, and a maximum sentence of life, along with a possible fine of not more than a $250,000. He could receive both a prison sentence and a fine. In determining the actual sentences, a Judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.
This case was investigated by the Drug Enforcement Administration, the St. Ann Police Department, and the Ferguson Police Department.
Lower Brule Man Charged with Burglary, Larceny, and Aiding and AbettingRead the Press Release
United States Attorney Ron Parsons announced that a Lower Brule, South Dakota, man has been indicted by a federal grand jury for First Degree Burglary, Larceny, and Aiding and Abetting.
Demitre’ Ecoffey, age 24, was indicted on February 13, 2019. He appeared before U.S. Magistrate Judge Mark A. Moreno on March 21, 2019, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 25 years in federal prison and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on May 25, 2017, Ecoffey entered an occupied structure at night with another individual with the intent to commit larceny, and stole personal property that had a value in excess of $1,000.
The charges are merely accusations and Ecoffey is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Federal Bureau of Investigation. Assistant U.S. Attorney Troy R. Morley is prosecuting the case.
Ecoffey was released on bond pending trial. A trial date has not been set.
Lawyer Michael Avenatti Arrested on Federal Bank Fraud and Wire Fraud ChargesRead the Press Release
LOS ANGELES – Attorney Michael Avenatti was arrested today pursuant to a criminal complaint alleging he embezzled a client’s money in order to pay his own expenses and debts — as well as those of his coffee business and law firm — and also defrauded a bank by using phony tax returns to obtain millions of dollars in loans.
Avenatti, 48, of Century City, was arrested today pursuant to a two-count felony complaint charging him with wire fraud and bank fraud. He also was arrested pursuant to a separate federal case filed in New York.
According to an affidavit filed with the criminal complaint in this case, Avenatti negotiated a settlement which called for $1.6 million in settlement money to be paid on January 10, 2018, but then gave the client a bogus settlement agreement with a false payment date of March 10, 2018. The affidavit states that Avenatti misappropriated his client’s settlement money and used it to pay expenses for his coffee business, Global Baristas US LLC, which operated Tully’s Coffee stores in California and Washington state, as well as for his own expenses. When the fake March 2018 deadline passed and the client asked where the money was, Avenatti continued to conceal that the payment had already been received, court documents said.
Avenatti also allegedly defrauded a bank in Mississippi by submitting to the lender false tax returns in order to obtain three loans totaling $4.1 million for his law firm and coffee business in 2014. According to the affidavit, Avenatti obtained the loans by submitting fabricated individual income tax returns (Forms 1040) for 2011, 2012, and 2013, reporting substantial income even though he had never filed any such returns with the Internal Revenue Service. The phony returns stated that he earned $4,562,881 in adjusted gross income in 2011, $5,423,099 in 2012, and $4,082,803 in 2013, according to the affidavit. Avenatti allegedly also claimed he paid $1.6 million in estimated tax payments to the IRS in 2012 and paid $1.25 million in 2013. In reality, Avenatti never filed personal income tax returns for 2011, 2012 and 2013 and did not make any estimated tax payments in 2012 and 2013. Instead of the millions of dollars he claimed to have paid in taxes, Avenatti still owed the IRS $850,438 in unpaid personal income tax plus interest and penalties for the tax years 2009 and 2010, court papers state. The affidavit also alleges that, as part of his loan applications, Avenatti also submitted a fictitious partnership tax return for his law firm.
“A lawyer has a basic duty not to steal from his client,” said United States Attorney Nick Hanna. “Mr. Avenatti is facing serious criminal charges alleging he misappropriated client trust funds for his personal use and he defrauded a bank by submitting phony tax returns in order to obtain millions of dollars in loans.”
“Professionals, including attorneys, who create elaborate schemes that have no purpose other than to mislead others and defraud both their clients and federally insured financial institutions, run the very high risk of prosecution,” said Special Agent in Charge Ryan Korner of IRS-Criminal Investigation. “The criminal complaint unsealed today shows a pattern of selfish behavior that paints Mr. Avenatti as a lawyer who only represents his own self interests.”
If convicted on both charges, Avenatti will face a statutory maximum sentence of 50 years in federal prison. Avenetti’s initial court appearance will be today in New York. He is expected to face the criminal charges in the California case in United States District Court in Santa Ana at a later date.
A complaint contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
This matter is being investigated by Internal Revenue Service-Criminal Investigation.
This case is being prosecuted by Assistant United States Attorneys Julian L. André of the Major Frauds Section and Brett A. Sagel of the Santa Ana Branch Office.
ComplaintKingston Man Sentenced to 78 Months’ Imprisonment for Drug TraffickingRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Adam Gottstein, age 32, of Kingston, Pennsylvania, was sentenced to 78 months’ imprisonment and five years of supervised release by United States District Judge Malachy E. Mannion, for conspiring to distribute heroin, crack cocaine, and fentanyl.
According to United States Attorney David J. Freed, Gottstein pleaded guilty to conspiring to distribute controlled substances in Pennsylvania, between approximately September 2016 through February 2017. Gottstein admitted to working as a drug dealer and in the conspiracy, to transporting drug from New York to Pennsylvania for redistribution, and to trafficking in excess of 280 grams of crack cocaine, fentanyl, and in excess of 400 grams of heroin, the latter of which is the equivalent of 16,000 potentially fatal doses of heroin. Gottstein also admitted to possessing a firearm during the course of his offense, and to maintaining a drug house.
Gottstein was charged in June 2017 with 14 other individuals. All of his co-defendants have pleaded guilty, with 11 others having already been sentenced:
- Kassandra Martin of Wilkes-Barre, Pennsylvania, was sentenced to 60 months of imprisonment;
- Joshua Lenchick of Luzerne, Pennsylvania, was sentenced to 60 months of imprisonment;
- Kristyna Shotwell of Plymouth, Pennsylvania, was sentenced to 12 months and one day of imprisonment;
- Tanay Jones of Bronx, New York, was sentenced to a time served sentence of 19 days of imprisonment;
- William Waring of Bronx, New York, was sentenced to 60 months of imprisonment;
- John Maybank of Bronx, New York, was sentenced to 53 months of imprisonment;
- Siobhan Daniels, of Wilkes-Barre, Pennsylvania, was sentenced to 30 months of imprisonment;
- Luis Nevarez, of Bronx, New York, was sentenced to 60 months of imprisonment;
- Adonis Smith, of New London, Connecticut, was sentenced to 60 months of imprisonment;
- Cara Dubaskas, of Plymouth, Pennsylvania, was sentenced to a time served sentence of 7 months; and
- Chad Eckrote, of Plymouth, Pennsylvania, was sentenced to 3 years of probation.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Luzerne County Drug Task Force, and by the Kingston Police Department. Assistant U.S. Attorney Phillip J. Caraballo prosecuted the case.
This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
This case also was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.
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Jury Finds Pierre Man Guilty of 7 Felony Counts Related to Aggravated Sexual Abuse of a Child, Interstate Travel with Intent to Engage in Illicit Sexual Conduct, and Child Pornography ChargesRead the Press Release
United States Attorney Ron Parsons announced that Amin Ricker, age 32, of Pierre, South Dakota, was found guilty of two counts of Aggravated Sexual Abuse of a Child, one count of Travel With Intent to Engage in Illicit Sexual Conduct, and four counts related to Transporting, Distributing, Receiving, and Possessing Child Pornography following a five-day jury trial in Pierre, South Dakota. The verdict was returned on March 22, 2019.
The charges carry a mandatory minimum of thirty years up to life in prison and/or a $250,000 fine, 5 years up to life of supervised release, and $700 to the Federal Crime Victims Fund. Restitution may also be ordered.
“Thanks to the joint efforts of federal, state, and local law enforcement officers, this vicious child sex predator is going to be locked up for a very long time,” said U.S. Attorney Parsons.
Ricker was indicted by a federal grand jury on April 12, 2017.
In February 2017, the South Dakota Internet Crimes Against Children Task Force and the Pierre Police Department began investigating Ricker based on reports from the National Center for Missing and Exploited Children that indicated Ricker was actively sharing and receiving child pornography via social media. On February 14, 2017, law enforcement executed a search warrant at Ricker’s residence in Pierre, seizing multiple electronic devices, including mobile phones, laptop computers, and thumb drives.
Analysis of Ricker’s electronic devices revealed thousands of images and videos of child pornography. Airline, bank, and electronic records corroborated live testimony that Ricker traveled in 2014 and 2015 from Huron, South Dakota, to Texas and engaged in sexual acts with 7-year-old children living there, and he preserved videos and images of the acts, storing them in folders named after each of the children. Ricker later used electronic platforms to share child pornography, including images involving the victims. Law enforcement analyzed social media accounts including Instagram, Kik, Yahoo, and Facebook, as well as Dropbox, which led them to Ricker’s Pierre residence. In mid-2015, Ricker, who was employed as a locomotive conductor, transferred from Huron to Pierre.
The investigation was conducted by the Federal Bureau of Investigation, South Dakota Internet Crimes Against Children Task Force, South Dakota Division of Criminal Investigation, Huron Police Department, Pierre Police Department, Texas Department of Public Safety Texas Ranger Division, and the Bogata (TX) Police Department. Assistant U.S. Attorneys Kirk Albertson and Cameron Cook prosecuted the case.
A sentencing date has not been set. Ricker was remanded to the custody of the U.S. Marshals Service pending sentencing.