Latest Records
Newest first across public DOJ and U.S. Attorney press releases.
6 March 2019
Indictment: Two Kansas Companies at Fault for Toxic Cloud over Atchison in 2016Read the Press Release
TOPEKA, KAN. – Two Kansas companies were indicted today on federal charges of safety violations that caused a greenish-yellow toxic chlorine gas cloud to form over the city of Atchison in October 2016, U.S. Attorney Stephen McAllister said. A web page, a phone line and an email address have been set up for victims to provide and receive information on the case.
The indictment alleges more than 140 people sought medical attention after 4,000 gallons of sulfuric acid combined with 5,800 gallons of sodium hypochlorite to form a toxic cloud that covered the city for 45 minutes until emergency personnel arrived to turn off the flow.
Midwest Grain Products, Inc., of Atchison, Kan., and Harcros Chemicals, Inc., of Kansas City, Kan., are charged with Clean Air Act violations that put the public in danger.
The indictment alleges that on Oct. 21, 2016, a driver for Harcros pulled a truck into Midwest Grain’s facility in Atchison to deliver sulfuric acid. An operator for Midwest Grain helped the driver access the transfer equipment. When the driver mistakenly connected the sulfuric acid line to the sodium hypochlorite line, toxic gas began to form. The indictment alleges both men violated safety rules by failing to verify that the connection was correct and failing to monitor the transfer.
ictims can get more information on US v. Midwest Grain Products, Inc., by visiting https://www.justice.gov/usao-ks/victim-witness and filling out a victim questionnaire, leaving a message on a designated phone line at 913-551-6543 or emailing questions to [email protected] .
If convicted, the defendant companies face the following penalties:
- Count one, violation of general duty clause: A fine up to $500,000.
- Count two, knowingly releasing a hazardous pollutant: A fine up to $1 million.
- Count three (alternate to count two), negligently releasing a hazardous pollutant: A fine up to $200,000.
The Environmental Protection Agency investigated. Assistant U.S. Attorney Rich Hathaway is prosecuting.
OTHER INDICTMENTS
Anderson Eduardo Seijas Chavez, 29, Miami, Fla., Angel A. Betancourt-Rodriguez, 23, Miami, Fla., and Carlos Alberto Campos-Rojas, 28, Summerfield, Fla., are charged with one count of conspiracy to create and use counterfeit credit and debit cards (count one). In addition, Chavez and Rojas are charged with one count of unlawfully possessing an ATM skimming device and a pinhole camera for the purpose of making counterfeit cards (count two) and one count of aggravated identity theft (count three). The crimes are alleged to have occurred in September and October 2018 in Johnson County, Kan.
If convicted, the face up to five years in federal prison and a fine up to $250,000 on count one, up to 10 years and a fine up to $250,000 on count two and not less than two years (consecutive) and a fine up to $250,000 on count three.
The U.S. Secret Service investigated. Assistant U.S. Attorney Chris Oakley is prosecuting.
Chris Lewis II, 26, Kansas City, Kan., is charged with three counts of distributing crack cocaine (counts one through three), one count of possession with intent to distribute marijuana (count four), one count of unlawful possession of a firearm in furtherance of drug trafficking (count five) and one count of unlawful possession of a firearm by a fugitive from justice (count six). The crimes are alleged to have occurred in December 2018 and January 2019 in Wyandotte County, Kan.
Upon conviction, the crimes carry the following penalties:
- Counts one through three: Up to 20 years in federal prison and a fine up to $1 million.
- Count four: Up to five years and a fine up to $250,000.
- Count five: Not less than five years and a fine up to $250,000.
- Count six: Up to 10 years and a fine up to $250,000.
The FBI and the Kansas City, Kan., Police Department investigated. Assistant U.S. Attorney Scott Rask is prosecuting.
Ryan Hawley, 29, who is in custody, is charged with one count of unlawful possession of a firearm by a convicted felon. The crime is alleged to have occurred Feb. 14, 2019, in Shawnee County, Kan.
If convicted, he faces up to 10 years in federal prison and fine up to $250,000. The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Topeka Police Department investigated. The U.S. Marshals Service, and the Kansas Highway Patrol Assisted in his arrest. Assistant U.S. Attorney Skip Jacobs is prosecuting.
Maria Alonso-Espinoza, 29, a citizen of Mexico, is charged with one count of distributing methamphetamine. The crime is alleged to have occurred Feb. 26, 2019.
According to court documents, the Kansas Highway Patrol stopped Alonso-Espinoza’s vehicle on I-70 in Russell County and found 21 pounds of methamphetamine
If convicted, she faces a penalty of not less than 10 years and a fine up to $10 million. The Drug Enforcement Administration investigated. Assistant U.S. Attorney Mona Furst is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
Illegal alien arrested on multiple charges pleads guilty for unlawfully re-entering the U.S.Read the Press Release
MONROE, La. – Eliezer Merino-Tetlactle, 25, of Mexico, pleaded guilty today before U.S. District Judge Terry Doughty to one count of re-entry of a removed alien, U.S. Attorney David C. Joseph announced.
According to the guilty plea, West Monroe police arrested Merino-Tetlactle on August 23, 2018 for carnal knowledge of a juvenile, computer aided solicitation of a minor, possession of marijuana and contributing to the delinquency of a juvenile. His background check showed that he was an illegal alien who had been previously removed from the United States twice.
Merino-Tetlactle faces two years in prison, one year of supervised release and a $250,000.
United States Immigrations and Customs Enforcement, Homeland Security Investigations and the West Monroe Police Department investigated the case. Assistant U.S. Attorney Leon H. Whitten is prosecuting the case.
Houston Woman Sentenced for Conspiring to Commit $50 Million Health Care Fraud and Money LaunderingRead the Press Release
HOUSTON – A 36-year-old Houston woman has been ordered to pay more than $15 million in restitution following her conviction of conspiring to commit $50 million health care fraud as well laundering money, announced U.S. Attorney Ryan K. Patrick. A jury convicted Daniela Gozes-Wagner in September 2017.
Today. U.S. District Judge David Hittner ordered Gozes-Wagner to serve a total of 240 months imprisonment to be immediately followed by three years of supervised release. She was further ordered to pay restitution of $15,283,985. At the hearing, the court noted Gozes-Wagner had “wreaked havoc” on the health care system of the United States.
Beginning in 2009, Gozes-Wagner conspired with others to falsely bill Medicare and Medicaid for millions of dollars of medical tests which were either not performed or were medically unnecessary.
Most of these tests supposedly occurred at 28 testing facilities over many years. However, when law enforcement conducted law enforcement operations there, they discovered that many of the facilities were actually empty offices.
To prevent Medicare from learning about the scheme, Gozes-Wagner hired “seat warmers” – young women paid to sit and answer phones in the nearly empty offices that comprised many of the “testing facilities.” They believed they could spend most of their time watching streaming movies. However, when Medicare investigators tried to inspect the empty offices, these “seat warmers” were instructed to notify Gozes-Wagner and prevent the investigators from inspecting the offices.
The conspirators also hid the true owners of the testing facilities by placing them in the names of other people.
The FBI, Texas Attorney General’s Medicaid Fraud Control Unit and the Department of Health and Human Services conducted the investigation with the assistance of the Office of Personnel Management and Railroad Retirement Board. Assistant U.S. Attorneys Michael Chu, Jim McAlister and Jason Smith prosecuted the case.
Harwich Man Sentenced for Fentanyl ConspiracyRead the Press Release
BOSTON – A Harwich man was sentenced yesterday in federal court in Boston for fentanyl conspiracy.
Dean Viprino, 46, was sentenced by U.S. District Court Judge Douglas P. Woodlock to eight years in prison and five years of supervised release. In December 2017, Viprino pleaded guilty to one count of conspiracy to possess with intent to distribute 40 grams or more of fentanyl. Viprino is currently in state custody on an unrelated matter.
Viprino was part of a drug trafficking organization that distributed large quantities of fentanyl, cocaine and heroin on Cape Cod. From April 2017 through August 2017, investigators intercepted phone calls and text messages from this drug organization. Wiretap interceptions, physical surveillance, and drug seizures demonstrated that Viprino had been purchasing fentanyl from this drug trafficking organization for personal use and re-distribution. Other members of the drug trafficking organization are either pending trial or awaiting sentencing.
United States Attorney Andrew E. Lelling; Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration, New England Field Division; and Massachusetts State Police Superintendent Colonel Kerry Gilpin made the announcement. Assistant U.S. Attorneys Eric Rosen, Alathea Porter, and Philip Cheng of Lelling’s Criminal Division prosecuted the case.
Hartford Man Charged with Illegal Gun PossessionRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, today announced that a federal grand jury in Hartford has returned an indictment charging DAMON HILL, 39, of Hartford, with one count of possession of a firearm a by a convicted felon.
The indictment was returned on February 5, 2019. Hill appeared today before U.S. Magistrate Judge Donna F. Martinez in Hartford and entered a plea of not guilty to the offense.
The indictment alleges that, on October 23, 2018, Hill unlawfully possessed a Smith and Wesson .40 caliber semi-automatic firearm in Hartford.
It is further alleged that Hill’s criminal history includes a 2005 state felony conviction for possession of narcotics, and a 2006 federal felony conviction for conspiring to distribute cocaine base (“crack cocaine”).
It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
If convicted of the offense, Hill faces a maximum term of imprisonment of 10 years and a fine of up to $250,000.
Hill has been detained since his arrest by Hartford Police on October 23, 2018.
U.S. Attorney Durham stressed that an indictment is not evidence of guilt. Charges are only allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being investigated by the FBI’s Connecticut Violent Crime Task Force and the Hartford Police Department. The case is being prosecuted by Assistant U.S. Attorney Anastasia E. King.
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.
Hamilton Township Man Sentenced to More Than 16 Years in Prison for Sexually Exploiting a Four Year OldRead the Press Release
CINCINNATI – Jake M. Damron, 27, of Loveland, Ohio, was sentenced in U.S. District Court today to 200 months in prison for sexually exploiting a child.
Benjamin C. Glassman, United States Attorney for the Southern District of Ohio, Todd Wickerham, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Division, Hamilton Township Police Chief Scott Hughes and the FBI’s Child Exploitation Task Force announced the sentence imposed by U.S. District Judge Michael R. Barrett.
Hamilton Township Police received a report on November 20, 2017, that Damron had taken pornographic pictures of a four year old to whom he had access. Damron was charged by a federal criminal complaint and arrested 10 days later.
Damron had sexual contact with the victim and was trading images of the victim for other child pornography via the Kik messenger app.
During an interview with FBI agents, Damron confirmed that he had taken sexually explicit photographs of the four year old. He stated this was the only victim he had photographed and that he had “probably” taken them due to easy access.
Damron was indicted by a grand jury in December 2017 and pleaded guilty in July 2018.
U.S. Attorney Glassman commended the investigation by the FBI and the Hamilton Township Police Department, as well as Assistant United States Attorney Kyle J. Healey, who is prosecuting the case.
# # #
Fugitive Apprehended After 20 YearsRead the Press Release
BOSTON – A Dominican national was sentenced yesterday in federal court in Boston for failing to appear for a sentencing hearing in 1997 following a conviction for passport fraud. He was also sentenced yesterday for the passport fraud.
Luis Alberto Solano-Pimental, 51, was sentenced by U.S. District Court Judge Mark L. Wolf to 16 months in prison and three years of supervised release. Solano-Pimental will be subject to deportation proceedings upon completion of his sentence.
In 1997, Solano-Pimental pleaded guilty to passport fraud in federal court in Boston, but failed to appear on his scheduled sentencing date. For more than 20 years, Solano-Pimental remained a fugitive until he was arrested in Warwick, R.I., on March 6, 2018; he has been detained since. He was then charged with failing to appear for the 1997 sentencing hearing, which he pleaded guilty to in May 2018.
United States Attorney Andrew E. Lelling; William B. Gannon, Special Agent in Charge of the U.S. Department of State, Diplomatic Security Service, Boston Field Office; John Gibbons, United States Marshal for the District of Massachusetts; and Jamie A. Hainsworth, United State Marshal for the District of Rhode Island, made the announcement. Assistant U.S. Attorney Christine Wichers of Lelling’s Major Crimes Unit prosecuted the case.
Four Guyanese Men Sentenced for Possession of Cocaine on Board a Vessel Following Seizure of 3,769 Kilograms of CocaineRead the Press Release
St. Croix, USVI –United States Attorney Gretchen C.F. Shappert announced today that Neville Jeffrey, 70, Mohamed Hoseain, 66, Richard La Cruz, 51, and Mark Anthony Williams, 32, all of Guyana, were sentenced to 48 months, 36 months, 30 months and 27 months respectively for possession of cocaine on board a vessel, by District Court Judge Wilma A. Lewis on March 5, 2019. Judge Lewis also sentenced each defendant to two years of supervised release, but ordered that they be deported upon release from incarceration. She further ordered them to pay a special assessment of $100.00 each and did not impose a fine.
Jeffrey, Hoseain, La Cruz and Williams pleaded guilty to cocaine possession charges in November and December of 2018. According to plea agreements filed with the court and statements at the sentencing hearing, the United States Coast Guard Cutter Napier, on February 16, 2017, intercepted a suspicious vessel in a joint operation with the Trinidad and Tobago Coast Guard approximately seventy nautical miles north of Paramaribo, Suriname, in international waters. The vessel, later identified as the LADY MICHELLE, was located in a known drug trafficking route and registered with St. Vincent and the Grenadines. The U.S. Coast Guard boarded the vessel pursuant to a bilateral agreement between the United States and St. Vincent and the Grenadines. They discovered 185 bales containing numerous rectangular shaped packages of cocaine in the vessel’s fish hold weighing 3,769 kilograms. The drugs had a street value in the U.S. Virgin Islands of approximately 71 million dollars. Jeffrey and Hoseain functioned as captains. La Cruz was identified as the engineer and Williams as the cook.
The case was investigated by the U.S. Coast Guard, the Trinidad and Tobago Coast Guard and the U.S. Drug Enforcement Administration and prosecuted by Assistant U.S. Attorney Alphonso Andrews, Jr.
Fort Dodge Man Pleads Guilty to Meth and Gun ChargesRead the Press Release
A man who conspired to distribute methamphetamine and possessed firearms illegally pled guilty March 6, 2019 in federal court in Sioux City.
Tate Steburg, 47, from Fort Dodge, Iowa, was convicted of conspiracy to distribute methamphetamine and illegally possessing a firearm. Steburg had previously been convicted of two felony drug trafficking convictions in the Iowa District Court.
At the plea hearing, Steburg admitted that from 2017 through February 2018, he was involved in a conspiracy that distributed more than 11 pounds of methamphetamine in the Fort Dodge area. Evidence at the plea hearing also showed that Steburg sold methamphetamine and a stolen gun to an individual cooperating with law enforcement. The gun was stolen in a Calhoun County, Iowa, burglary/arson case.
Sentencing before United States District Court Chief Judge Leonard T. Strand will be set after a presentence report is prepared. Steburg remains in custody of the United States Marshal pending sentencing. On the drug conviction, Steburg faces a mandatory minimum sentence of 15 years’ imprisonment and a possible maximum sentence of life imprisonment, a $20,000,000 fine, and ten years up to life of supervised release following any imprisonment. On the firearm conviction, Steburg faces a possible maximum sentence of 10 years’ imprisonment, a $250,000 fine, and not more than three years of supervised release following any imprisonment.
The case is being prosecuted by Assistant United States Attorney Shawn S. Wehde and was investigated by the Iowa Division of Narcotics Enforcement, Fort Dodge Police Department, Webster County Sheriff’s Office, Iowa State Patrol and Iowa Division of Criminalistics Investigation.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl. The case file number is 18-3013. Follow us on Twitter @USAO_NDIA.
Former WV Supreme Court of Appeals Justice Menis Ketchum II Sentenced for FraudRead the Press Release
CHARLESTON, W.Va. -- Menis E. Ketchum II, age 76, of Huntington, a former Justice of the Supreme Court of Appeals of West Virginia, was sentenced to three years of probation, a $20,000 fine and was ordered to pay restitution to the State of West Virginia by Senior United States District Judge John T. Copenhaver, Jr., announced United States Attorney Mike Stuart. The Federal Bureau of Investigation, the West Virginia Legislature’s Commission on Special Investigations, and the Internal Revenue Service—Criminal Investigation Division conducted the investigation.
“Menis Ketchum pled guilty to a felony,” said United States Attorney Mike Stuart. “There is no such thing as a little bit of public corruption, but Justice Ketchum at least did the right thing for doing the wrong thing. Ketchum accepted responsibility for his misdeeds by resigning from the court and acknowledging his wrongdoing. It is my sincere hope that we may soon be able to end our investigation of the West Virginia Supreme Court and allow the people of West Virginia to move forward with confidence and respect for a court that is often the ultimate judge on critical matters affecting all West Virginians. I want to thank my prosecutors, Assistant United States Attorney Phil Wright and former Assistant United States Attorney Anna Forbes, along with our federal and state law enforcement partners, for their excellent work in this case.”
Justice Ketchum pled guilty to wire fraud in August 2018. Ketchum served as a Supreme Court Justice from January 1, 2008 through July 27, 2018. He admitted to repeated personal use of a State of West Virginia vehicle and State fuel credit card over the course of 2011 through 2014 in connection with his travel from his home in Huntington, West Virginia to and from a private golf club in western Virginia. The roundtrip mileage for each of these golf outings was approximately 400 miles and cost the taxpayers of West Virginia approximately $220 per trip. In particular, on August 6, 2014, he traveled to the private golf club in a State vehicle, and returned to his home on August 9, 2014. During the return trip to Huntington, Ketchum used a State fuel card to purchase gasoline in Princeton, West Virginia, causing an interstate wire communication.
Assistant United States Attorney Phil Wright and former Assistant United States Attorney L. Anna Forbes handled the prosecution.
Follow us on Twitter: SDWVNews
###
Former Roslindale Postal Service Employee Sentenced for Theft of MailRead the Press Release
BOSTON – A former Roslindale Post Office employee was sentenced today in federal court in Boston in connection with embezzling mail.
Megan Hawes, 29, of Roslindale, was sentenced by U.S. District Court Judge Denise J. Casper to two years of supervised release and 80 hours of community service. In December 2018, Hawes pleaded guilty to one count of theft of mail matter by a Postal Service employee.
From September 2016 to May 2018, Hawes was employed by the United States Postal Service (USPS) as a postal carrier assigned to Roslindale. While in that capacity, between approximately March 2017 and May 10, 2018, Hawes embezzled and stole more than 9,700 pieces of U.S. mail that she never delivered. She sifted through and stole the contents of some of the mail that contained cash and gift cards. On May 10, 2018, USPS was notified that there was a car at an impound lot in Weymouth that contained voluminous amounts of undelivered and opened mail. USPS determined Hawes had used that car while in her postal carrier capacity. That same day, USPS interviewed Hawes, who ultimately admitted that she had been stealing mail and not delivering it. She also admitted to opening some of the stolen parcels looking for cash and gift cards.
United States Attorney Andrew E. Lelling; Matthew Modafferi, Special Agent in Charge of the U.S. Postal Service, Office of Inspector General, Northeast Area Field Office; and Weymouth Police Chief Richard C. Grimes made the announcement today. Assistant U.S. Attorney Suzanne Sullivan Jacobus of Lelling’s Major Crimes Unit prosecuted the case.
Former Patient Coordinator Pleads Guilty to Wrongfully Disclosing Health Information to Cause HarmRead the Press Release
PITTSBURGH, PA - A resident of Butler, Pennsylvania, pleaded guilty in federal court to a charge of wrongfully disclosing the health information of another individual, United States Attorney Scott W. Brady announced today.
Linda Sue Kalina, 61, pleaded guilty to one count before United States District Judge Arthur J. Schwab.
In connection with the guilty plea, the court was advised that Linda Sue Kalina worked, from March 7, 2016 through June 23, 2017, as a Patient Information Coordinator with UPMC and its affiliate, Tri Rivers Musculoskeletal Centers (TRMC) in Mars, Pennsylvania, and that during her employment, contrary to the requirements of the Health Insurance Portability and Accountability Act (HIPAA) improperly accessed the individual health information of 111 UPMC patients who had never been provided services at TRMC. Specifically, on August 11, 2017, Kalina unlawfully disclosed personal gynecological health information related to two such patients, with the intent to cause those individuals embarrassment and mental distress.
Judge Schwab scheduled sentencing for June 25, 2019, at 10 a.m. The law provides for a total sentence of 10 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant. Kalina remains on bonding pending the sentencing hearing.
Assistant United States Attorney Carolyn J. Bloch is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation conducted the investigation that led to the prosecution of Kalina.
Former Director of Operations of a Rockford Non-Profit Organization Pleads Guilty to FraudRead the Press Release
ROCKFORD — LEILANI HILLIS, 60, of Rockford, the former director of operations of a Rockford non-profit organization, pleaded guilty Monday before U.S. District Judge Frederick J. Kapala to one count of mail fraud and one count of tax fraud.
According to a written plea agreement, since 2001 Hillis was an employee of a non-profit organization whose mission was to attract, retain and expand jobs in the Rockford area. The organization received funding from private sources and local governments. During her employment, Hillis handled the organization’s payroll, human resource matters and accounting, and oversaw the annual audit. As of 2009, Hillis had signatory authority on the organization’s bank account and access to the organization’s PayPal account. The organization issued employees, including Hillis, a credit card in the employee’s name. From 2009 through April 2018, Hillis used her employee-issued credit card to make unauthorized purchases for her personal benefit totaling $632,718.99. Hillis concealed her crime by using the organization’s accounting codes to make it appear the purchases were for the organization’s benefit, and she forged the initials of the organization’s president on the expense reports. Hillis issued and signed checks from the organization’s account to the bank, knowing the payments included money to pay for her unauthorized purchases.
Hillis also admitted that she did not report as income the money from the organization that she used to pay the organization’s credit card for her unauthorized personal purchases. As a result, for the tax years 2014 through 2017, Hillis failed to pay $151,186.91 in federal income taxes.
HILLIS faces a maximum sentence of 20 years’ imprisonment for mail fraud, and a maximum sentence of three years for tax fraud, while each charge also carries a fine of up to $250,000 or twice the gross gain or gross loss resulting from that offense, whichever is greater, plus full restitution. The actual sentence will be determined by the United States District Court, guided by the Sentencing Guidelines. Sentencing for Hillis is set for June 27, 2019, at 9:00 a.m., before U.S. District Judge Philip G. Reinhard.
The guilty plea was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Jeffrey S. Sallet, Special Agent-in-Charge of the Chicago office of Federal Bureau of Investigation; and Gabriel L. Grchan, Special Agent-in-Charge of the Internal Revenue Service Criminal Investigation Division in Chicago. The government is represented by Assistant U.S. Attorney Scott R. Paccagnini.
Feds Charge over A Dozen Defendants with 15 Violent Robberies in Kentucky, Tennessee, and Other States That Targeted Small BusinessesRead the Press Release
BOWLING GREEN, Ky. – United States Attorney Russell M. Coleman announced the addition of eight co-defendants charged by a federal grand jury in connection to the violent robberies of 15 commercial businesses located in North Carolina, Tennessee, Indiana, and Kentucky; including La Placita market, located in Warren County, Kentucky, where five previous co-defendants were charged in the shooting death of a Bowling Green resident.
Thirteen defendants are charged in a seven count superseding indictment unsealed on Tuesday March 5, 2019.
“These defendants are off the street because of outstanding work by the FBI and the Bowling Green Police Department,” stated U.S. Attorney Russell Coleman. “Our families and our Commonwealth are well-served by both.”
The superseding indictment charges all 13 defendants with conspiracy to interfere with commerce by robbery – targeting primarily Hispanic owned convenience stores and markets in the four states. May of the defendants resided in Nashville, Tennessee where they allegedly identified businesses to rob, and organized plans to travel to the targeted businesses.
The defendants include:
- Jorge Santos Caballero-Melgar, age 34, from Nashville, TN
- Jonny Alexander Reyes-Martinez, age 29, from Nashville, TN
- Jose Adan Mejia Varela, age 31, from Nashville, TN
- Lillian Yamileth Duron, age 24, from Nashville, TN
- Estrellita Soto, age 35, from Nashville, TN
- Elmer Manuel Ordonez Sanchez, age 25, from Nashville, TN
- Elvin Fernando Lopez Sanchez, age 26, from Nashville, TN
- Javier Alexis Mejia Varela, age 27, from Nashville, TN
- Brandon Michael Maldonado-Caro, age 25, from Nashville, TN
- Alex Antonio Maldonado-Rodriguez, age 34, from Nashville, TN
- Junior Esteban Bueso, age 39, from Nashville, TN
- Jose Javier Cedillo-Sales, age 28, from Nashville, TN
- Jamie Cedillo-Sales, age 23, from Snow Hill, NC
According to the superseding indictment, the defendants planned and robbed businesses, including: Beat the Clock Tax Service in Lexington, Kentucky, taking approximately $67,000 in cash; La Despensa in Clarksville, Indiana, taking around $7,000 in cash; Lesly Jewelry and Perfume in Nashville, Tennessee taking approximately $200,000 in cash and jewelry; La Regia in Rocky Mount, North Carolina taking approximately $25,000 in cash; La Placita in Bowling Green, Kentucky taking about $23,500 in cash. Defendants robbed multiple other businesses which can be found listed in the indictment. The charge carries a penalty of no more than 20 years in federal prison. There is no parole in the federal system.
Eleven of the defendants (Caballero-Melgar, Reyes-Martinez, Jose Varela, Elmer Sanchez, Elvin Sanchez, Javier Varela, Maldonado-Caro, Maldonado-Rodriguez, Bueso, Jose Cedillo-Sales, Jaime Cedillo-Sales) are charged with carrying or possessing a firearm during a crime of violence; the charge carries a penalty of no more than 20 years imprisonment.
The five original defendants (Caballero-Melgar, Reyes-Martinez, Jose Varela, Duron, and Soto) are charged in the indictment with interference of commerce by robbery for the March 17, 2017, robbery of La Placita in Bowling Green, Kentucky. The charge carries a term of imprisonment of no more than 20 years.
The Grand Jury further charged Caballero-Melgar, Reyes-Martinez, and Jose Varela with murder through the use of a firearm during a crime of violence for the death of J.C. during the robbery of La Placita in Warren County; the charge carries a maximum penalty of death or a term of life in prison.
Caballero-Melgar faces an additional charge of illegal entry after deportation. Reyes-Martinez and Jose Varela are also charged with being an illegal alien in possession of a firearm.
This case is being prosecuted by Assistant United States Attorneys Marisa Ford and Alicia Gomez. The case is being investigated by the Bowling Green Police Department and the FBI with assistance from the Warren County Commonwealth Attorney’s Office; Northampton County, VA Sheriff’s Office; Metro Nashville, TN Police Department; Rocky Mount, NC Police Department; Clayton, NC Police Department; Cary, NC Police Department; Henderson, NC Police Department; Snow Hill, NC Police Department; Chatham County, NC Sheriff’s Department; Department of Homeland Security; and United States Marshals. Assistant U.S. Attorneys David Weiser and Jo Lawless also assisted in the investigation.
####
The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.
Federal Jury Convicts Career Criminal of Firearm and Drug Distribution OffensesRead the Press Release
Ocala, Florida – United States Attorney Maria Chapa Lopez announces that a federal jury has found Jovan Demetrius Fredericks (39, Ocala) guilty of possessing a firearm as a convicted felon, possessing with the intent to distribute controlled substances, and carrying a firearm in relation to a drug trafficking crime. Fredericks faces a minimum mandatory sentence of 20 years, and up to life, in federal prison. His sentencing hearing has not yet been set. Fredericks was indicted on January 9, 2019.
According to testimony and evidence presented at trial, on the morning of September 29, 2018, officers from the Ocala Police Department encountered Fredericks at the Parkside Gardens public housing complex. Fredericks, a multi-convicted felon, immediately tried to conceal a hand-rolled cigarette containing illegal narcotics from the officers. When the officers stopped to investigate, they saw a loaded, full-size handgun with an extended ammunition magazine tucked into the waistband of Fredericks’s pants. After arresting Fredericks for the firearm, a search of his person revealed multiple packages of illegal drugs ready for sale, including MDMA (“ecstasy”), N-Ethylpentylone (“bath salts”), and cocaine. Fredericks’s extensive criminal record—which includes prior convictions for robbery, possession of a firearm by a felon, and repeated sales of illegal drugs—will qualify him as an Armed Career Criminal for federal sentencing purposes.
This is another case prosecuted as part of the Department of Justice’s “Project Safe Neighborhoods” Program (PSN), which is a nationwide crime reduction strategy aimed at decreasing violent crime in communities. It involves a comprehensive approach to public safety — one that includes investigating and prosecuting crimes, along with prevention and reentry efforts. In the Middle District of Florida, U.S. Attorney Maria Chapa Lopez coordinates PSN efforts in cooperation with various federal, state, and local law enforcement officials.
This case was investigated by the City of Ocala Police Department, the Federal Bureau of Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Florida Department of Law Enforcement. It is being prosecuted by Assistant United States Attorney Robert E. Bodnar, Jr.
Federal Inmate Sentenced for EscapingRead the Press Release
BECKLEY, W.Va. – United States Attorney Mike Stuart announced today that an inmate who escaped from the Federal Prison Camp at Alderson was sentenced. Cheryl McGrath, 51, was sentenced to 12 months in prison, to run consecutively to the sentence she is presently serving. McGrath pled guilty in November to escaping from custody, admitting that on July 26, 2018, she left the Federal Prison Camp at Alderson without permission. She was captured the next day a few miles from the prison.
“If you escape, we will find you,” said United States Attorney Mike Stuart. “Escapees will merely be prolonging their stay in federal prison.”
The case was investigated by the Federal Bureau of Prisons, the United States Marshals Service and the West Virginia State Police. Assistant United States Attorney John File prosecuted the case. United States District Judge Irene C. Berger imposed the sentence.
Follow us on Twitter: SDWVNews
###
Federal Indictment Charges Six Individuals for a Fentanyl Distribution Conspiracy Operating in HagerstownRead the Press Release
Baltimore, Maryland – A federal grand jury has indicted six individuals for conspiracy to distribute fentanyl. The indictment was returned under seal on February 21, 2019, and unsealed today upon the arrest of the following defendants on March 5, 2019:
Lekeith Dion Mitchell, age 49, of Hagerstown, Maryland; Gary Lee Washington, age 38, of Smithsburg, Maryland; Joenna Marie Nicewarner, age 33, of Hagerstown; and
Lama Junior Jean-Pierre, age 36, of Fairplay, Maryland.Dustin Ray Stipes, age 35, and Nyana Angelina Cheese, age 28, both of Hagerstown, are also charged with the fentanyl distribution conspiracy, and are still being sought.
Mitchell is also charged with possession with intent to distribute fentanyl, maintaining a drug-involved premises, and being a felon in possession of firearms. Washington is also charged with possession of a firearm in furtherance of a drug trafficking crime and with being a felon in possession of a firearm.
The indictment was announced by United States Attorney for the District of Maryland Robert K. Hur; Assistant Special Agent in Charge Don A. Hibbert of the Drug Enforcement Administration, Baltimore District Office; and Washington County Sheriff Douglas W. Mullendore.
According to the indictment, from September through December 2018, the defendants conspired to distribute fentanyl in Hagerstown and the surrounding area. The indictment alleges that Mitchell maintained a residence in Hagerstown which was used to manufacture, store, distribute, and use fentanyl. According to the indictment, on December 17, 2018, Washington possessed a semi-automatic rifle in furtherance of the drug trafficking, and on February 1, 2019, Mitchell allegedly possessed four loaded firearms. Washington and Mitchell both have previous felony convictions and are therefore prohibited from possessing firearms and ammunition.
The indictment also seeks the forfeiture of $127,241.25 in cash seized during the investigation, and 12 luxury watches. During the course of the investigation, law enforcement also seized more than two kilograms of fentanyl. Just two milligrams of fentanyl can be fatal, and two kilograms is enough to kill 1 million people—25 times the population of Hagerstown.
If convicted, all the defendants except Jean-Pierre face a minimum mandatory sentence of 10 years in prison and up to life in prison for the fentanyl distribution conspiracy. Jean-Pierre faces a minimum mandatory sentence of five years in prison and up to 40 years in prison for the conspiracy. Mitchell also faces minimum mandatory sentence of 10 years in prison and up to life in prison for possession with intent to distribute fentanyl and a maximum of 20 years in prison for maintaining drug-involved premises. Washington faces a maximum of five years in prison, consecutive to any other sentence imposed, for possession of a firearm in furtherance of a drug trafficking crime. Mitchell and Washington each face a maximum of 10 years in prison for being a felon in possession of a firearm and/or ammunition. At the initial appearances held on March 6, 2019, in U.S. District Court in Baltimore, U.S. Magistrate Judge Beth P. Gesner ordered that Washington be detained pending a detention hearing scheduled for March 7, 2019. Nicewarner and Mitchell consented to detention. Jean-Pierre was ordered to be released under the supervision of U.S. Pretrial Services.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Robert K. Hur commended the DEA and the Washington County Sheriff’s Office for their work in the investigation. Mr. Hur thanked Assistant U.S. Attorneys Christopher J. Romano and Samika Boyd, who are prosecuting the case.
# # #
Federal Indictment Adds Second Defendant Charged with Witness Retaliation and Tampering Resulting in the Death of a Baltimore WomanRead the Press Release
Baltimore, Maryland - A federal grand jury in Baltimore, Maryland returned a 10-count superseding indictment charging Davon Carter, age 39, and Clifton Mosley, age 41, both of Baltimore, Maryland, with two counts of conspiracy to murder a witness and one count each of witness retaliation murder and witness tampering murder, related to the murder of Latrina Ashburne, age 41, on May 27, 2016.
The superseding indictment adds a narcotics conspiracy, and two counts of using a cellular telephone to facilitate the commission of a felony, to the charges Davon Carter already faced--specifically, being a felon in possession of ammunition and possession with intent to distribute marijuana. Mosley is also charged with distribution of marijuana.
The superseding indictment was returned on March 5, 2019, and unsealed today at Mosley’s initial appearance before U.S. Magistrate Judge Beth P. Gesner in U.S. District Court in Baltimore. Mosley is detained pending trial. Carter is scheduled for an initial appearance on the new charges on March 14, 2019. Carter remains detained.
The indictment was announced by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge Maureen Dixon of the Department of Health and Human Services Office of Inspector General; Acting Special Agent in Charge Jennifer L. Moore of the Federal Bureau of Investigation; Acting Commissioner Michael Harrison of the Baltimore Police Department; Special Agent in Charge Rob Cekada of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Baltimore Field Division; and Chief Terrence B. Sheridan of the Baltimore County Police Department.
“We take witness tampering and witness retaliation very seriously,” said U.S. Attorney Robert K. Hur. “Those who attempt to tamper with or retaliate against a witness will face federal prosecution and could receive a mandatory sentence of life in prison – or even the death penalty.”
According to the 10-count indictment, Carter and Mosley conspired to and did kill Ashburne with the intent to retaliate against a witness for providing information to a law enforcement officer relating to the commission and possible commission of a federal offense, as well as to prevent a witness from attending and testifying in an official proceeding.
According to the Baltimore Police Department, Ashburne was murdered in the early morning as she got into her car outside the home she shared with her mother in the 2900 block of Rosalind Avenue in the Cylburn neighborhood. The police reported that an unknown male approached and shot Ms. Ashburne in the upper body as she tried to run. At the time, the police also released a video they said showed the suspect running away from the scene.
If convicted, Carter and Mosley each face a mandatory sentence life in prison for each of the two conspiracy counts, and for the witness retaliation and witness tampering murder charges. Carter faces a maximum penalty of ten years in prison for being a felon in possession of ammunition, for possession with intent to distribute marijuana, and for the narcotics conspiracy, and faces a maximum of eight years in prison for each of the two counts of using a cellular telephone to facilitate the commission of a felony. Mosley also faces a maximum of five years in prison for distribution of marijuana.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Robert K. Hur commended the HHS-OIG, the FBI, the Baltimore Police Department, the ATF, and the Baltimore County Police Department for their work in the investigation. Mr. Hur thanked Assistant U.S. Attorneys Sandra Wilkinson and Judson Mihok, who are prosecuting the case.
# # #
Federal Charges Allege Corruption Schemes by South Suburban Harvey Officials and AssociatesRead the Press Release
CHICAGO — Six defendants have been charged as part of an ongoing federal investigation into corruption schemes allegedly carried out by city of Harvey officials or their associates. Among the defendants are two cousins with high-ranking relatives in Harvey government who allegedly extorted cash from a strip club owner, and two Harvey police officers who allegedly falsified a police report to protect acquaintances from facing firearm charges. Federal law enforcement today executed court-authorized search warrants at two locations in Harvey.
Several of the defendants were arrested today and are scheduled to make initial court appearances today at 2:00 p.m. before U.S. Magistrate Judge Maria Valdez in Chicago.
The charges were announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Jeffrey S. Sallet, Special Agent-in-Charge of the Chicago office of the Federal Bureau of Investigation; Gabriel L. Grchan, Special Agent-in-Charge of the Internal Revenue Service Criminal Investigation Division in Chicago; Brad Geary, Special Agent-in-Charge of the U.S. Department of Housing and Urban Development's Office of Inspector General in Chicago; and Thomas J. Dart, Cook County Sheriff. The Harvey Police Department is cooperating in the investigation. The government is represented by Assistant U.S. Attorneys Sean J.B. Franzblau, Grayson S. Walker and Brian P. Netols.
Criminal complaints unsealed today in federal court in Chicago allege three separate corruption schemes:
U.S. v. Kellogg, et al, 19 CR 192
ROMMELL KELLOGG, 66, of Harvey, and COREY JOHNSON, 63, of Harvey, are charged with conspiracy to commit extortion. Kellogg and Johnson are cousins with high-ranking relatives in Harvey government, the complaint states. From 2012 to 2016, Kellogg and Johnson conspired to regularly extort payments from a Harvey strip club owner based on threats that the city would shut down the business if the payments were not made, the complaint states. The charges allege that in exchange for the payments, city officials allowed the business to operate, knowing that acts of prostitution were occurring onsite.
U.S. v. Muhammad, et al, 19 CR 190
DERRICK MUHAMMAD, 70, of South Holland, and DERRICK MOORE, 48, of Blue Island, are charged with obstruction of justice and conspiracy to obstruct justice. Muhammad and Moore are Harvey Police Department officers who allegedly worked together to falsify a police report to protect two acquaintances from possibly facing firearm charges. The acquaintances – a father and son – were convicted felons who could not legally possess a firearm, the complaint states.
In March 2018, the operator of a Harvey-based towing company notified Muhammad that a handgun was discovered in a Chrysler 300 sedan that had been reported stolen and ordered towed by police in nearby Calumet City, the complaint states. The sedan was used by the father and had recently been driven by the son. Muhammad and Moore schemed to conceal the firearm’s connection to the pair, with Moore preparing and filing a police report stating that he discovered the weapon in some brush near the towing company “while on patrol,” the charges allege.
U.S. v. Luster, et al, 19 CR 191
DONALD LUSTER, 55, of Dixmoor, and WILL WILEY, 56, of Harvey, are charged with conspiracy to commit federal program bribery. Luster worked as a private consultant to the city of Harvey. In November 2017, he agreed with Wiley to solicit bribe payments from an entrepreneur who owned a towing company in a nearby suburb, the complaint states. In exchange for the bribes, Luster would provide the entrepreneur with a lease to a parcel of land owned by the city of Harvey, the complaint states.
Unbeknownst to Luster and Wiley, the entrepreneur was cooperating with law enforcement and had agreed to make consensual recordings of conversations and meetings with the pair, the complaint states. In a recorded meeting on Dec. 3, 2017, the entrepreneur paid a cash bribe of $5,000 to Wiley, the complaint states. Shortly thereafter, an employee of the city of Harvey provided the entrepreneur access to the parcel of land. On Jan. 5, 2018, the entrepreneur delivered a $7,000 cash bribe to Luster, after which Luster and the city employee advised that the entrepreneur could continue to access and use the parcel, the complaint states. An official lease was never provided to the entrepreneur, the complaint states.
~~~
The public is reminded that charges are not evidence of guilt. The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. The conspiracy counts are each punishable by up to five years in prison, while the obstruction charge is punishable by up to 20 years. If convicted, the Court must impose reasonable sentences under federal statutes and the advisory U.S. Sentencing Guidelines.
Anyone wishing to notify law enforcement of suspected corruption in Harvey is encouraged to email the FBI at [email protected].
FCI-Loretto Inmate Charged with Possessing ContrabandRead the Press Release
JOHNSTOWN, Pa. – An inmate at the Federal Correctional Institution in Loretto, Pa., was indicted by a federal grand jury in Johnstown on a charge of possession of a prohibited object in prison, United States Attorney Scott W. Brady announced today.
The indictment named Ryan S. Harris, 35.
According to the indictment presented to the court, on September 28, 2018, Harris possessed a quantity of Buprenorphine.
The law provides for a maximum sentence of 20 years in prison and a fine of $250,000 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history of the defendant.
Assistant United States Attorney Stephanie L. Haines is prosecuting this case on behalf of the government.
The Laurel Highlands Resident Agency of the Federal Bureau of Investigation, and the Federal Correctional Institution, Special Investigative Staff, conducted the investigation leading to the prosecution of Harris.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
ExxonMobil to Pay Civil Penalty and Take Remedial Measures to Resolve Clean Air Act Violations Stemming from Deadly Fire at Texas RefineryRead the Press Release
The Department of Justice and the U.S. Environmental Protection Agency (EPA) announced a settlement with ExxonMobil Oil Corporation (ExxonMobil) today to resolve federal Clean Air Act claims arising from a 2013 fire at the company’s oil refinery in Beaumont, Texas that killed two employees and injured ten others. In a complaint filed today with the settlement, the United States alleges that the company violated Section 112(r) of the Clean Air Act, which requires measures to prevent accidental releases of extremely hazardous substances that can have serious public health and environmental consequences.
The April 17, 2013, fire at the refinery occurred when workers used a torch to remove bolts from the top, or “head,” of a device called a heat exchanger. The torch ignited hydrocarbons released from the head. EPA’s inspection following the incident disclosed violations of Section 112(r) and of the regulations known as the Chemical Accident Prevention provisions.
“The deaths and injuries resulting from the 2013 fire at ExxonMobil’s Beaumont refinery are a terrible tragedy,” said Assistant Attorney General Jeffrey Bossert Clark for the Department of Justice’s Environment and Natural Resources Division. “Today’s settlement sends a clear message to companies handling hazardous substances in their operations that they must take the necessary steps to protect their workers under the environmental laws or face the consequences of vigorous enforcement. Additionally, the relief the United States has secured will aid in protecting a vulnerable surrounding community from future tragic episodes like this one.”
“When companies shortcut the safety requirements that have been put in place, especially in high risk situations like this, people can die,” said U.S. Attorney Joseph D. Brown of the Eastern District of Texas. “It is important that companies understand that there is not only liability in private civil suits, but administrative fines to pay. We cannot put a price on the lives lost, but we hope to deter these kinds of violations to save lives in the future.”
“We rely on companies to carefully follow environmental regulations, which are designed—above all—to protect human health,” said EPA Regional Administrator Anne Idsal. “As the incident at ExxonMobil’s facility shows, failing to comply with these rules can have devastating consequences.”
Under the consent decree, ExxonMobil will pay a $616,000 civil penalty, hire an independent third party auditor to conduct a compliance audit of ExxonMobil’s procedures for opening process equipment at ten different process units at the refinery, and perform a supplemental environmental project (SEP) under EPA’s SEP Policy to purchase a hazardous materials Incident Command Vehicle (ICV), valued at $730,000, for the Beaumont Fire & Rescue Service (BFRS). The auditor will also evaluate the company’s procedures for conducting risk-based mechanical integrity inspections.
The ICV will contain equipment specifically tailored to enhance BFRS’s hazardous-material incident response capabilities, including its 24-hour emergency response services from 12 fire stations. From these stations, BFRS provides fire, hazardous materials, disaster, technical rescue, and first responder emergency medical services over 90 square miles containing numerous petroleum and/or chemical facilities. The ICV will enhance BFRS’s capability to communicate and coordinate emergency response activities in the event of a fire, explosion or similar major incident.
The proposed consent decree was lodged in the U.S. District Court for the Eastern District of Texas and is subject to a 30-day public comment period and final court approval. Information about submitting a public comment is available at: https://www.justice.gov/enrd/consent-decrees.
Essex County, New Jersey, Man Sentenced to 18 Months in Prison for Illegal Food Stamps SchemeRead the Press Release
NEWARK, N.J. – An Essex County, New Jersey, man was sentenced today to 18 months in prison for his role in a food stamps fraud scheme, U.S. Attorney Craig Carpenito announced.
Manuel Venegas, 54, of Newark, previously pleaded guilty before U.S. District Judge John Michael Vazquez to an information charging him with one count of Supplemental Nutrition Assistance Program (SNAP) benefit fraud. Judge Vazquez imposed the sentence today in Newark federal court.
According to documents filed in this case and statements made in court:
From March 2015 to March 2018, Venegas was an employee of Jenny’s Deli, a small grocery store in Newark, New Jersey. Venegas’ daughter, Maria Teresa Venegas, was the listed owner of Jenny’s Deli and pleaded guilty to the same crime in September 2018. She was sentenced Feb. 20, 2019, to two years in prison.
Jenny’s Deli was authorized to accept benefits provided by SNAP, formerly known as the Food Stamp Program. The program is administered by the U.S. Department of Agriculture. Retail food stores approved for participation in SNAP may sell food in exchange for SNAP benefits but may not exchange SNAP benefits for cash. According to the charges against them, Maria Teresa Venegas and Manuel Venegas exchanged more than $885,000 in SNAP benefits for cash between 2011 and 2018.
Every SNAP recipient receives an Electronic Benefit Transfer (EBT) card, similar to a debit card, to use to make purchases. Every retailer authorized to accept SNAP benefits has an EBT terminal. Food purchases are made by swiping the card at the terminal. After the customer enters a Personal Identification Number (PIN), the EBT terminal verifies the PIN, determines whether the customer’s account balance is sufficient to cover the proposed transaction, and informs the retailer whether the transaction should be authorized or denied. The amount of the purchase is deducted electronically from the SNAP benefits reserved for the customer and the purchase amount is credited to the retailer’s designated bank account.
In addition to the high volume of SNAP benefits redemptions for Jenny’s Deli, indicating fraud, law enforcement agents verified the fraudulent exchange of SNAP benefits for cash through the use of an undercover law enforcement agent who engaged in approximately 20 “purchases” at Jenny’s Deli where Manuel Venegas, Maria Theresa Venegas, or another Jenny’s Deli employee acting at their direction exchanged money for SNAP benefits.
In addition to the prison term, Judge Vazquez sentenced Manuel Venegas to two years of supervised release and ordered restitution of $573,199.
U.S. Attorney Carpenito credited special agents of the U.S. Department of Agriculture – Office of Inspector General, under the direction of Special Agent in Charge Bethanne M. Dinkins, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Jason S. Gould of the U.S. Attorney’s Office Criminal Division in Newark.
Exxonmobil to Pay Civil Penalty and Take Remedial Measures to Resolve Clean Air Act Violations Stemming from Deadly Fire at Texas RefineryRead the Press Release
WASHINGTON – The Department of Justice and the U.S. Environmental Protection Agency (EPA) announced a settlement with ExxonMobil Oil Corporation (ExxonMobil) today to resolve federal Clean Air Act claims arising from a 2013 fire at the company’s oil refinery in Beaumont, Texas that killed two employees and injured ten others. In a complaint filed today with the settlement, the United States alleges that the company violated Section 112(r) of the Clean Air Act, which requires measures to prevent accidental releases of extremely hazardous substances that can have serious public health and environmental consequences.
The April 17, 2013, fire at the refinery occurred when workers used a torch to remove bolts from the top, or “head,” of a device called a heat exchanger. The torch ignited hydrocarbons released from the head. EPA’s inspection following the incident disclosed violations of Section 112(r) and of the regulations known as the Chemical Accident Prevention provisions.
“The deaths and injuries resulting from the 2013 fire at ExxonMobil’s Beaumont refinery are a terrible tragedy,” said Assistant Attorney General Jeffrey Bossert Clark for the Department of Justice’s Environment and Natural Resources Division. “Today’s settlement sends a clear message to companies handling hazardous substances in their operations that they must take the necessary steps to protect their workers under the environmental laws or face the consequences of vigorous enforcement. Additionally, the relief the United States has secured will aid in protecting a vulnerable surrounding community from future tragic episodes like this one.”
“When companies shortcut the safety requirements that have been put in place, especially in high risk situations like this, people can die,” said U.S. Attorney Joseph D. Brown of the Eastern District of Texas. “It is important that companies understand that there is not only liability in private civil suits, but administrative fines to pay. We cannot put a price on the lives lost, but we hope to deter these kinds of violations to save lives in the future.”
“We rely on companies to carefully follow environmental regulations, which are designed—above all—to protect human health,” said EPA Regional Administrator Anne Idsal. “As the incident at ExxonMobil’s facility shows, failing to comply with these rules can have devastating consequences.”
Under the consent decree, ExxonMobil will pay a $616,000 civil penalty, hire an independent third party auditor to conduct a compliance audit of ExxonMobil’s procedures for opening process equipment at ten different process units at the refinery, and perform a supplemental environmental project (SEP) under EPA’s SEP Policy to purchase a hazardous materials Incident Command Vehicle (ICV), valued at $730,000, for the Beaumont Fire & Rescue Service (BFRS). The auditor will also evaluate the company’s procedures for conducting risk-based mechanical integrity inspections.
The ICV will contain equipment specifically tailored to enhance BFRS’s hazardous-material incident response capabilities, including its 24-hour emergency response services from 12 fire stations. From these stations, BFRS provides fire, hazardous materials, disaster, technical rescue, and first responder emergency medical services over 90 square miles containing numerous petroleum and/or chemical facilities. The ICV will enhance BFRS’s capability to communicate and coordinate emergency response activities in the event of a fire, explosion or similar major incident.
The proposed consent decree was lodged in the U.S. District Court for the Eastern District of Texas and is subject to a 30-day public comment period and final court approval. Information about submitting a public comment is available at: https://www.justice.gov/enrd/consent-decrees
Drug Trafficking Organizer Sentenced to Prison as Part of A Multi Defendant Drug Investigation and ProsecutionRead the Press Release
DENVER – Jose Tapia-Rubio, age 60, of Aurora, Colorado, was sentenced yesterday by U.S. District Court Judge Raymond P. Moore to serve 96 months (8 years) in federal prison followed by 5 years on supervised release for conspiracy to distribute and possess with intent to distribute more than five kilograms of cocaine, and conspiracy to conduct an unlawful financial transaction, U.S. Attorney Jason Dunn, DEA Denver Division Special Agent in Charge Tim McDermott and IRS CI Special Agent in Charge Steven Osborne announced. Tapia-Rubio appeared at the hearing in custody and was remanded at its conclusion.
Tapia-Rubio is one of 17 defendants charged in this large scale prosecution of a drug trafficking organization (DTO). These individuals were charged by indictment on April 13, 2017. A superseding indictment was obtained on July 11, 2017. Tapia-Rubio pled guilty on June 25, 2018. He was sentenced on March 5, 2019. The other defendants include:
- Rodrigo Mora-Sanchez – sentenced to 138 months in prison followed by 5 years on Supervised Release
- Lara Zamora-Cruz -- sentenced to 72 months in prison followed by 5 years on Supervised Release
- Selestino Hernandez-Mayo – sentenced to 60 months in prison followed by 2 years on Supervised Release
- Eduardo Jimenez-Sanchez – sentenced to 60 months in prison followed by 4 years on Supervised Release
- Heberto Mora-Sanchez – sentenced to 60 months in prison followed by 4 years on Supervised Release
- Jose Chica-Orellana – sentenced to 55 months in prison followed by 5 years on Supervised Release
- Oscar Mora-Campos – sentenced to 40 months in prison followed by 5 years on Supervised Release
In addition, several other defendants have cases that remain pending.
According to court documents and evidence presented in court, between February 2016 and May 2017, the Drug Enforcement Administration Strike Force and the Aurora Police Department conducted an investigation into a drug trafficking organization (DTO). Tapia-Rubio and his co-conspirators played significant roles within that DTO. The investigation revealed that the DTO imported multi-kilogram/multi-pound quantities of cocaine and methamphetamine from Mexico to California. The drugs were then transported to Colorado and then sold to customers in the Denver metro area, as well as customers located in Breckenridge, Aspen and New Castle. The DTO received, off-loaded, stored and sold drugs at El Rancho Market located in Aurora. That business was owned by Tapia-Rubio. The DTO maintained a stash house in Aurora as well.
During the course of the investigation law enforcement seized: 1) 12.5 kilograms of cocaine and 1.2 pounds of methamphetamine; 2) approximately $692,000 in bulk cash drug proceeds; 3) two homes valued at approximately $615,600; 4) three vehicles valued at approximately $28,650; and 5) eleven firearms.
“Targeting drug traffickers and focusing on the top of their organizations is an important role for the U.S. Attorney’s Office,” U.S. Attorney Jason Dunn said. “Thanks go to the agents from the DEA, IRS CI and the Aurora Police Department who worked tirelessly on this case.”
“This investigation targeted a significant cocaine and methamphetamine drug trafficking organization based in Aurora, Colorado and the Denver metropolitan area,” said DEA Denver Division Special Agent in Charge Tim McDermott. “This provides another prime example of the commitment of the DEA, working with our state, local, and federal partners, to dismantle and remove drug trafficking organizations in order to protect our communities.”
Steven Osborne, Special Agent in Charge, IRS Criminal Investigation stated, “This is an important victory for the American public. Not only is a criminal going to jail for his crimes, but the government has seized a significant amount of illegal proceeds through asset forfeiture. The role of IRS CI in narcotics investigations is to follow the money so we can financially disrupt and dismantle major drug trafficking organizations. IRS Criminal Investigation is proud to provide its financial expertise as we work alongside our law enforcement partners to bring criminals to justice.”
This case was investigated by the DEA, IRS CI and the Aurora Police Department. This case is being prosecuted by Assistant U.S. Attorneys Stephanie Podolak, Zachary Phillips and Tonya Andrews.
Dominican Republic National Charged with Trafficking over 1,000 Kilograms of Cocaine Enters Guilty Plea in Federal CourtRead the Press Release
St. Thomas, USVI – Dany Perez-Brito, 44, of the Dominican Republic, pled guilty to Conspiracy to Possess a Controlled Substance on Board a Vessel Subject to the Jurisdiction of the United States in District Court before Judge Curtis Gomez, United States Attorney Gretchen C.F. Shappert announced.
According to court documents, a United States Coast Guard (USCG) aircraft detected a go-fast style vessel with no indicia of nationality located about 65 nautical miles north of San Juan, Puerto Rico. After being detected, the go-fast vessel led authorities on a ten-hour chase in international waters between Puerto Rico and St. Thomas. USCG personnel were able to board the vessel when it finally went dead in the water approximately 96 nautical miles north of St. Thomas. Upon boarding the vessel, authorities discovered 52 bales containing a total of approximately 1,132 kilograms of a white powdery substance that field tested positive for cocaine. In court, Perez-Brito admitted to having conspired to transport the cocaine by boat from Venezuela to Puerto Rico, for which he expected to be paid $200,000.
Perez-Brito faces a mandatory minimum sentence of ten years’ imprisonment, a five-year term of supervised release, and a fine of up to $10,000,000.
This case was being investigated by the USCG, U.S. Customs and Border Protection (CBP) Air and Marine Operations (AMO), Homeland Security Investigations (HSI), and the Drug Enforcement Agency (DEA), and is being prosecuted by Assistant United States Attorney Meredith J. Edwards.
District Court Rules That MTA’s Renovation of Subway Station Triggered MTA’s Obligation Under Americans with Disabilities Act to Install Elevators Unless Technically InfeasibleRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that partial summary judgment has been granted in favor of plaintiffs and the Government in a lawsuit brought under the Americans with Disabilities Act (“ADA”) by private plaintiffs (Bronx Independent Living Services et al. v. MTA) in which the United States intervened. U.S. District Judge Edgardo Ramos ruled that the Metropolitan Transportation Authority’s (the “MTA”) replacement of the stairways at the Middletown Road subway station in the Bronx affected the station’s usability, thus triggering the MTA’s obligation under the ADA to install elevators, without regard to cost, unless it is technically infeasible to do so.
U.S. Attorney Geoffrey S. Berman said: “The MTA is now on notice that whenever it renovates a subway station throughout its system so as to affect the station’s usability, the MTA is obligated to install an elevator, regardless of the cost, unless it is technically infeasible. Individuals with disabilities have the same rights to use the New York City subway system as every other person. The Court’s decision marks the end of the MTA treating people with disabilities as second-class citizens. My Office will continue to work to ensure that the provisions of the Americans with Disabilities Act are enforced, and that everyone enjoys equal access to public transit in this District.”
The ADA, signed into law in 1990, prohibits discrimination against individuals with disabilities in all areas of public life, including jobs, schools, transportation, and all public and private places that are open to the general public. Under its provisions, the ADA requires state and local government agencies to make alterations to public transit facilities readily accessible to, and usable by, individuals with disabilities, including those who use wheelchairs.
In March 2018, this Office intervened in a private lawsuit brought by Disability Rights Advocates regarding the MTA’s refusal to install elevators at the Middletown Road station, despite undertaking a substantial renovation of the entire station, including the staircases. The Department of Transportation, Federal Transit Authority (“FTA”), had declined the MTA’s request for federal funds for the renovation because the MTA’s refusal to install elevators violated the ADA.
Judge Ramos ruled that MTA’s renovation of the Middletown Road station was an alteration that triggered the ADA’s requirement to install an elevator unless it is technically not feasible to do so. Specifically, Judge Ramos concluded that when a public transit authority alters a station in a way that affects its “usability,” the public transit authority must follow the requirements in 49 C.F.R. § 37.43(a)(1), requiring the installation of an elevator where technically feasible regardless of cost. The Court rejected the MTA’s argument that the governing regulation permitted it to avoid installing an elevator based on cost considerations.
Mr. Berman thanked Disability Rights Advocates for its work in this case, as well as FTA for its continued assistance with this matter.
This case is being handled by the Civil Rights Unit of the Office’s Civil Division. Assistant U.S. Attorneys Ellen Blain and Lara Eshkenazi are in charge of the case.
Disbarred Orange County Attorney Sentenced to 7 Years in Prison for Mail Fraud, Tax Evasion, Obstruction of Justice, Perjury, and Other CrimesRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today that former Orange County attorney JOSEPH SCALI was sentenced to seven years in prison in connection with SCALI’s conviction for mail fraud, structuring cash transactions, making false statements to the IRS, obstructing the IRS, tax evasion, obstruction of justice, and perjury following a four-week jury trial. SCALI was sentenced today by U.S. District Judge Nelson S. Román, who presided over the trial.
U.S. Attorney Geoffrey S. Berman said: “Joseph Scali, a former attorney, was convicted of embezzling $850,000 from his attorney trust account that held third party funds from an uncompleted real estate transaction. Instead of returning the funds – which he was required to do by law – Scali used them on his personal expenses, including sports tickets and international travel. Scali also filed false tax returns and made false sworn statements to the court. Joseph Scali violated his responsibilities as a lawyer and a taxpayer, and now will have seven years in federal prison to reflect on his wide array of financial crimes and failure to act ethically before the court.”
According to the Indictment, court filings, and statements made in public court proceedings:
From January 2011 through August 2012, SCALI – then a licensed, practicing attorney – perpetrated a scheme to defraud a prospective buyer of land and mineral rights in Pennsylvania. SCALI represented the seller in the land transaction and was entrusted to hold the buyer’s funds in his attorney trust account pending closing, which never took place. Instead of preserving the buyer’s funds and returning them when the transaction fell through, SCALI embezzled $850,000 of the buyer’s money from his attorney trust account and spent the majority on personal expenses, including season sports tickets, luxury clothing items, and trips abroad.
After defrauding the buyer, SCALI engaged in tax evasion for the years 2011 and 2012 by, among other things, deliberately withholding from the IRS his attorney trust account records, which would have revealed the funds he had misappropriated and made him liable for hundreds of thousands of dollars in unpaid federal income taxes.
In addition, between 2006 and November 2013, SCALI corruptly endeavored to obstruct the IRS by (a) providing materially false, incomplete, and misleading information to an IRS Revenue Officer about his tax filing history and income; (b) commingling client funds and personal funds in his attorney trust account; (c) paying for personal items directly out of his attorney trust account; (d) structuring $32,400 in cash deposits into his attorney trust account. In addition, SCALI failed to timely file U.S. Individual Income Tax Returns, Forms 1040, for the years 2006 through 2012, as well as U.S. Corporate Income Tax Returns, Forms 1120, for his law firm, Joseph G. Scali, P.C., for the years 2007 through 2012, notwithstanding that he was required by law to file a return for each year. SCALI was also separately convicted of making false statements to the IRS and structuring cash deposits.
In all, SCALI caused the IRS to incur losses of over $500,000, not including penalties and interest.
SCALI also committed obstruction of justice and perjury when, in seeking to set aside his disbarment by the U.S. District Court for the Southern District of New York, he lied under oath to that court about the reason for his 2013 suspension from the practice of law in New York State.
In 2014 and 2015, SCALI perpetrated a second mail fraud scheme by fraudulently undertaking a legal representation of a client for a fee without disclosing his 2013 suspension from the practice of law in New York State.
On July 6, 2016, SCALI was disbarred by the Second Judicial Department of the Appellate Division of the New York State Supreme Court.
* * *
In addition to the prison term, Judge Román ordered SCALI to serve three years of supervised release and to pay restitution totaling $1,511,534.73 to the victims of his mail fraud schemes and the IRS.
Mr. Berman praised the work of the IRS, the U.S. Postal Inspection Service, and the Special Agents of the U.S. Attorney’s Office in this investigation. Mr. Berman also thanked the Orange County District Attorney’s Office, the New York State Department of Taxation and Finance, the New York State Police, the Counsel for the Grievance Committee for the Ninth Judicial District of New York State, the Counsel for the Committee on Grievances for the U.S. District Court for the Southern District of New York, and the Counsel for the IOLA Fund of New York for their assistance and cooperation in the investigation.
This case is being handled by the Office’s White Plains Division. Assistant United States Attorneys Olga Zverovich, Vladislav Vainberg, and Daniel Noble are in charge of the prosecution.
Department of Justice Highlights Western District of Oklahoma for Its Focus on Firearms Offenses Involving Domestic ViolenceRead the Press Release
OKLAHOMA CITY – In remarks today in Washington, DC, Katharine Sullivan, the Acting Director of the Justice Department’s Office of Violence Against Women, singled out the U.S. Attorney’s Office for the Western District of Oklahoma for its success in prosecuting firearms cases involving domestic violence. The office’s initiative, "Operation 922," is the local implementation of Project Safe Neighborhoods, a Department-wide program to prevent and prosecute violent crime. For the full text of Acting Director Sullivan’s remarks at the FBI’s celebration of National Women’s History Month, see: https://www.justice.gov/ovw/blog/womens-history-month-reflections-individuals-who-influence-us-and-doj-accomplishments.
As part of Operation 922, federal prosecutors in the Western District of Oklahoma focus on enforcing federal laws to keep firearms out of the hands of those Congress has precluded from possessing firearms. Operation 922 specifically focuses on domestic violence abusers who are subject to a victim protection order or restraining order, or who have been previously convicted in any court of a misdemeanor crime of domestic violence. Section 922 of Title 18 of the United States Code prohibits those specific offenders from possessing firearms or ammunition. The U.S. Attorney’s Office also targets domestic violence offenders through Section 922’s prohibition on possessing a firearm after any felony conviction. In addition, the office prosecutes violent crime cases in Indian Country, including domestic abuse acts involving strangulation and cases in which a firearm or other weapon is used.
"You cannot have safe neighborhoods without first having safe homes," said Bob Troester, First Assistant U.S. Attorney. "This effort to protect victims of domestic violence relies upon our committed partnership with District Attorney David Prater and his office, the Oklahoma City Police Department and Chief Bill Citty, and Palomar, Oklahoma City’s Family Justice Center. It is also the result of the dedicated work of the women and men of the U.S. Attorney’s Office to protect victims from domestic abusers."
Locally, since Operation 922 was initiated last year, over 50 domestic-violence-related cases have been charged by Western District prosecutors. These cases include all prosecutions for illegal possession of firearms related to domestic violence. Nationally, according to Justice Department data, the number of defendants charged in the specific category of possessing a firearm after a misdemeanor conviction (18 U.S.C. § 922(g)(9)) has grown by nearly 80%, from 110 in Fiscal Year ("FY") 2016 to 197 in FY2018. In the same period, convictions increased more than 160% from 55 in FY2016 to 148 in FY2018.
For further information about Operation 922, please contact the U.S. Attorney’s Office at (405) 553-8999.
Danville Man Sentenced on Wire Fraud, Identity Theft, Student Loan Fraud ChargesRead the Press Release
Danville, VIRGINIA – A Danville resident, who committed federal student loan fraud by enrolling dozens of individuals in online universities for personal financial gain, was sentenced yesterday in federal court to more than nine years in prison, United States Attorney Thomas T. Cullen announced.
Tyrone Dwayne Young, 30, was sentenced yesterday to 111 months in federal prison. The Court, also ordered Young to pay restitution of more than $1.1 million to the United States Department of Education and eight institutions of higher education, including Strayer University, Capella University, Post University, the University of Phoenix, Derry University, Kaplan University, Argosy University and Liberty University based in Lynchburg. The Court’s sentencing orders follow Young’s guilty plea on November 1, 2018, to one count of wire fraud, one count of student loan fraud, and one count of aggravated identity theft, the latter of which carries a mandatory sentence of two years.
According to information presented at previous hearings by Assistant United States Attorney Kari Munro, beginning in or about May 2016, Young started using the personal identifiers of family members and friends to enroll them as students in online universities. Working through Department of Education and university websites, he created fraudulent student profiles to enroll his victims in online courses of study for the purpose of obtaining federal student loans in their names. His victims never completed their courses of study and eventually failed or were withdrawn, in most instances after student loan funds for their educational programs had been disbursed. Young tracked and orchestrated the receipt of these fraudulent student loan funds for personal use.
Eventually, Young expanded his efforts to include individuals outside his immediate circle of family and friends. Posing as a higher education employee, Young encouraged low-income residents in the greater Danville area to provide their personal identifiers for enrollment purposes, promising free government money and other benefits. In all, Young’s scheme involved the use of personal identifying information for more than 60 individuals, resulting in an attempted loss to the Department of Education and affected institutions of more than $1.4 million.
Investigation of this case was conducted by the United States Department of Education, Office of Inspector General and the United States Postal Inspection Service, with assistance from the Virginia State Police. Assistant United States Attorney Kari Munro prosecuted the case for the United States.
Cotati Resident Sentenced to Prison for Filing False ReturnsRead the Press Release
SAN FRANCISCO – Stanley Charles was sentenced today to 33 months in prison and ordered to pay $657,888 in restitution for tax fraud, announced United States Attorney David L. Anderson and Internal Revenue Service, Criminal Investigation (IRS-CI), Special Agent in Charge Kareem Carter. The sentence was handed down by the Honorable Maxine M. Chesney, U.S. District Judge.
Charles, age 33, of Cotati, Calif., pleaded guilty to the charges on July 18, 2018. According to the plea agreement, Charles admitted that for tax years 2009 through 2015, he prepared and filed 428 false and fraudulent federal income tax returns requesting false deductions and credits on behalf of other taxpayers. For example, Charles prepared and filed a fraudulent federal income tax return for a husband and wife without their knowledge or permission. The tax return falsely reported that the couple had $8,000 in qualified higher education expenses. Along with the false return, Charles filed a document directing the IRS to pay $5,447 of the refund to the couple, and the remaining $1,235 to his own bank account. In addition, Charles admitted he prepared and filed with the IRS a false 2011 Amended U.S. Individual Income Tax Return regarding his own income. Charles knew he was entitled to an American Opportunity Credit of no more than $2,500 and nevertheless falsely reported a credit of $9,873.
On June 18, 2018, Charles was charged by information with one count of tax fraud, in violation of 26 U.S.C. § 7206(2), and one count of filing a false federal income tax return, in violation of 26 U.S.C. § 7206(1). Charles pleaded guilty to both counts.
In addition to the prison term, Judge Chesney sentenced the defendant to one year of supervised release. Judge Chesney also ordered the defendant to refrain from aiding or assisting in the preparation of federal income tax returns for anyone other than himself. Judge Chesney ordered the defendant to begin serving his prison term on May 6, 2019.
Assistant U.S. Attorney Cynthia Stier is prosecuting the case with the assistance of Kathy Tat. The prosecution is the result of an investigation by the IRS-CI.
Convicted Felon Sentenced to Seventy-Six Months in Prison for Possessing A Firearm and AmmunitionRead the Press Release
OAKLAND –James Robert Lewis was sentenced to 76 months in prison for being a felon in possession of a firearm and for violating the terms of his supervised release, announced United States Attorney David L. Anderson and Federal Bureau of Investigation (FBI) Special Agent in Charge John F. Bennett. The sentence was handed down today by the Honorable Phyllis J. Hamilton, Chief United States District Judge.
Lewis, 35, of Richmond, Calif., pleaded guilty to the felon-in-possession charge on December 14, 2018. In pleading guilty, Lewis admitted that on August 26, 2018, he was a convicted felon and was not eligible to possess a firearm. He fled from a Richmond police officer and discarded a loaded semiautomatic handgun into the bed of a pickup truck. The firearm had an extended magazine, with a thirty-round capacity, and was loaded with 27 rounds of ammunition. Lewis further acknowledged that on August 26, 2018, he was on supervised release pursuant to a conviction in 2013 for a separate firearms offense.
On September 27, 2018, a federal grand jury indicted Lewis, charging him with being a felon in possession of a firearm and ammunition, in violation of 18 U.S.C. § 922(g)(1). Lewis pleaded guilty to the charge and admitted that the crime was also a violation of the terms of his supervised release. Chief Judge Hamilton ordered the defendant to serve a combined 76 months for both violations.
In addition to the prison term, Chief Judge Hamilton ordered Lewis to serve a three-year term of supervised release to begin at the conclusion of his prison term.
Assistant United States Attorney Katherine Lloyd-Lovett is prosecuting the case with the assistance of Elyza Delgado. The prosecution is the result of an investigation by the FBI and the Richmond Police Department.
Connecticut U.S. Attorney’s Office Collects More Than $49 Million in Civil and Criminal Actions for U.S. Taxpayers in Fiscal Year 2018Read the Press Release
New Haven – U.S. Attorney John H. Durham today announced that the U.S. Attorney’s Office for the District of Connecticut collected $49,188,380.37 in criminal and civil actions in Fiscal Year 2018. Of this amount, $7,111,152.86 was collected in criminal actions and $42,077,227.51 was collected in civil actions.
Overall, the Justice Department collected a total of just over $15 billion in civil and criminal actions in the fiscal year ending September 30, 2018.
“This past fiscal year, our Office’s dedicated attorneys and staff helped to recover more than $49 million,” said U.S. Attorney Durham. “We are gratified that these funds are returned directly to victims of crime, provide needed services for these victims and fund ongoing federal, state and local law enforcement efforts. One of our primary missions is to seek justice for victims, remove ill-gotten gains from wrongdoers and protect the integrity of important government programs.”
The largest civil collections in the District of Connecticut were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct, or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts owed to several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education, were collected by the U.S. Attorney’s Office from debtors located in Connecticut.
All of the U.S. Attorney’s Office’s criminal recoveries in fiscal year 2018 were the result of successful enforcement against criminal defendants who committed various types of crime, with the largest recoveries in cases involving wire and securities fraud.
Nationally, the U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and victims of federal crimes. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid directly to the victim, criminal fines and felony assessments are also collected by the U.S. Attorneys’ Offices and paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.
Additionally, the U.S. Attorney’s office in the District of Connecticut, working with partner agencies and divisions, collected $5,407,828.00 in asset forfeiture actions in FY 2018. Of this amount, $3,962,387 was collected in civil cases and $826,833 was collected criminal cases. $618,608 was collected administratively. Forfeited assets deposited into the Department of Justice Assets Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.
“The men and women of the U.S. Attorneys’ offices across the country work diligently, day in and day out, to see that the citizens of our nation receive justice. The money that we are able to recover for victims and this country as a whole is a direct result of their hard work,” Director James A. Crowell, IV, Executive Office for U.S. Attorneys.
The U.S. Attorney’s Office is charged with enforcing federal criminal laws in Connecticut and representing the federal government in civil litigation. The Office is composed of approximately 68 Assistant U.S. Attorneys and approximately 57 staff members at offices in New Haven, Hartford and Bridgeport.
For more information about the U.S. Attorney’s Office for the District of Connecticut, please visit www.justice.gov/ct.
New Haven – U.S. Attorney John H. Durham today announced that the U.S. Attorney’s Office for the District of Connecticut collected $49,188,380.37 in criminal and civil actions in Fiscal Year 2018. Of this amount, $7,111,152.86 was collected in criminal actions and $42,077,227.51 was collected in civil actions.
Overall, the Justice Department collected a total of just over $15 billion in civil and criminal actions in the fiscal year ending September 30, 2018.
“This past fiscal year, our Office’s dedicated attorneys and staff helped to recover more than $49 million,” said U.S. Attorney Durham. “We are gratified that these funds are returned directly to victims of crime, provide needed services for these victims and fund ongoing federal, state and local law enforcement efforts. One of our primary missions is to seek justice for victims, remove ill-gotten gains from wrongdoers and protect the integrity of important government programs.”
The largest civil collections in the District of Connecticut were from affirmative civil enforcement cases, in which the United States recovered government money lost to fraud or other misconduct, or collected fines imposed on individuals and/or corporations for violations of federal health, safety, civil rights or environmental laws. In addition, civil debts owed to several federal agencies, including the U.S. Department of Housing and Urban Development, Health and Human Services, Internal Revenue Service, Small Business Administration and Department of Education, were collected by the U.S. Attorney’s Office from debtors located in Connecticut.
All of the U.S. Attorney’s Office’s criminal recoveries in fiscal year 2018 were the result of successful enforcement against criminal defendants who committed various types of crime, with the largest recoveries in cases involving wire and securities fraud.
Nationally, the U.S. Attorneys’ Offices, along with the department’s litigating divisions, are responsible for enforcing and collecting civil and criminal debts owed to the U.S. and victims of federal crimes. The law requires defendants to pay restitution to victims of certain federal crimes who have suffered a physical injury or financial loss. While restitution is paid directly to the victim, criminal fines and felony assessments are also collected by the U.S. Attorneys’ Offices and paid to the department’s Crime Victims’ Fund, which distributes the funds to state victim compensation and victim assistance programs.
Additionally, the U.S. Attorney’s office in the District of Connecticut, working with partner agencies and divisions, collected $5,407,828.00 in asset forfeiture actions in FY 2018. Of this amount, $3,962,387 was collected in civil cases and $826,833 was collected criminal cases. $618,608 was collected administratively. Forfeited assets deposited into the Department of Justice Assets Forfeiture Fund are used to restore funds to crime victims and for a variety of law enforcement purposes.
“The men and women of the U.S. Attorneys’ offices across the country work diligently, day in and day out, to see that the citizens of our nation receive justice. The money that we are able to recover for victims and this country as a whole is a direct result of their hard work,” Director James A. Crowell, IV, Executive Office for U.S. Attorneys.
The U.S. Attorney’s Office is charged with enforcing federal criminal laws in Connecticut and representing the federal government in civil litigation. The Office is composed of approximately 68 Assistant U.S. Attorneys and approximately 57 staff members at offices in New Haven, Hartford and Bridgeport.
Collin County Man Guilty of Child Exploitation ViolationsRead the Press Release
SHERMAN, Texas – A 21-year-old McKinney, Texas man has pleaded guilty to child exploitation violations in the Eastern District of Texas, announced U.S. Attorney Joseph D. Brown today.
Stephen Chase Clark pleaded guilty to attempted coercion and enticement of a minor and receipt of child pornography before U.S. Magistrate Judge Christine A. Nowak on Mar. 4, 2019.
According to information presented in court, in August 2018, law enforcement officers conducting an undercover investigation dubbed Operation Zeus, encountered Clark chatting on social media with an individual he believed to be a minor male. Clark engaged in sexual conversations with the individual and asked for photographs of the child. Clark was arrested on Aug. 28, 2018, after he went to a location in McKinney where he expected to meet the individual he believed to be a child to engage in sexual activities. A review of Clark’s cellular phone and social media accounts revealed a number of sexually explicit chats between Clark and other young males. Law enforcement also found a number of child pornography and chats about trading child pornography.
Clark entered into a plea agreement with the government that includes a sentence of 250 months in federal prison. A sentencing date has not yet been set and the actual sentence will be determined by a federal judge at sentencing.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorneys’ Offices and the Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
This case is being investigated by the Federal Bureau of Investigation and the Collin County Sheriff’s Office and prosecuted by Assistant U.S. Attorney Marisa Miller.
FBI agents continue to work to identify children whose images were located on Clark’s electronic devices and encourage anyone who had contact with Clark or may have additional information to contact the U.S. Attorney’s Office at 1-800-804-3547.
####
Cincinnati Man Sentenced for Dealing Heroin Laced with Carfentanil; Attempting to Murder WitnessRead the Press Release
CINCINNATI – A defendant was sentenced today in the first federally indicted carfentanil prosecution in the country.
Phillip Watkins, 34, of Cincinnati, was sentenced in U.S. District Court today to 300 months in prison for conspiring to distribute heroin laced with carfentanil and attempting to murder a witness he believed was going to testify against him if he went to trial on the drug charge.
Benjamin C. Glassman, United States Attorney for the Southern District of Ohio, Timothy J. Plancon, Special Agent in Charge, Drug Enforcement Administration (DEA), Cincinnati Police Chief Eliot K. Isaac, Hamilton County Sheriff Jim Neil, Hamilton County Coroner Dr. Lakshmi Sammarco, other members of the Hamilton County Heroin Task Force including the Ohio Bureau of Criminal Identification in Ohio Attorney General Dave Yost’s Office, the Ohio State Highway Patrol, and police departments in Norwood, Blue Ash and Sharonville and Springfield Township announced the sentence imposed today U.S. District Judge Susan J. Dlott.
Court documents say Watkins conspired with others in August 2016 to sell heroin laced with carfentanil, an animal tranquilizer 10,000 times more powerful than morphine, from a residence in the Elmwood Place neighborhood of Cincinnati and that users suffered both fatal and non-fatal overdoses of the potent drugs he sold.
Task force officers arrested Watkins in September 2016 and a federal grand jury indicted him that same month.
While in custody awaiting trial on those drug charges, Watkins learned of a potential witness against him in that case. Watkins arranged to have that witness killed to prevent their testimony. Law enforcement uncovered the plot and stopped it before the murder could take place. A grand jury indicted Watkins for witness tampering in March 2017.
“There is no deadlier poison than carfentanil. In dealing that drug, Watkins showed a disregard for human life, which he then confirmed by plotting to have the witness against him killed,” U.S. Attorney Glassman said. “His 300-month sentence is a fitting punishment and will keep the community safe. I commend all of the law enforcement agencies participating in the Hamilton County Heroin Coalition Task Force. Their incredibly nimble work made this case possible. Enforcement efforts like these are a big part of turning the tide against synthetic opioids in Ohio.”
Deputy Criminal Chiefs Michael Hunter and Emily Glatfelter and Assistant United States Attorneys Timothy Oakley and Megan Gaffney represented the United States in these cases.
# # #
Chicago Man Convicted of Sex Trafficking a 16-Year-Old Girl Who Was Allegedly Murdered by a CustomerRead the Press Release
CHICAGO — A federal jury today convicted a Chicago man on sex trafficking charges for arranging a commercial sex encounter for a 16-year-old girl that ended in the child’s murder in a south suburban garage.
JOSEPH HAZLEY, 35, was convicted on one count of conspiracy to engage in sex trafficking of a minor, one count of sex trafficking of a minor, and four counts of transporting a person across state lines for the purposes of prostitution.
The conviction is punishable by a maximum sentence of life in prison. U.S. District Judge Sharon Johnson Coleman set sentencing for June 4, 2019.
The conviction was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Jeffrey S. Sallet, Special Agent-in-Charge of the Chicago office of the Federal Bureau of Investigation; and Eddie Johnson, Chicago Police Superintendent. Substantial assistance was provided by the South Suburban Major Crimes Task Force, Cook County Sheriff’s Office, Cook County State’s Attorney’s Office, and Markham Police Department. The government is represented by Assistant U.S. Attorneys Christopher Parente and Kelly Greening.
Evidence at trial revealed that Hazley posted the girl’s information in commercial sex advertisements on Backpage.com, and arranged multiple meetings for her to engage in prostitution. Hazley drove the girl to several meetings in the Chicago area in December 2016.
One of the meetings occurred in the early morning hours of Christmas Eve, after a customer had responded to Hazley’s posting. Hazley drove the girl to Markham and waited in his car a few yards from the garage while she met with the customer. During the encounter, the customer allegedly murdered the girl.
The suspected customer was subsequently arrested by the Chicago Police Department and charged with murder in Cook County Criminal Court.
If you believe you are a victim of sexual exploitation, you are encouraged to call the National Center for Missing and Exploited Children at 1-800-843-5678. The hotline is available 24 hours a day, 7 days a week.
Cherokee Man Sentenced to Federal Prison for Meth ConspiracyRead the Press Release
A man who conspired to distribute methamphetamine was sentenced March 5, 2019, to 12 years in federal prison.
Raymond Andrew Kerns, 37, from Cherokee, Iowa, received the prison term after a September 10, 2018, guilty plea to conspiracy to distribute methamphetamine and possession with intent to distribute methamphetamine. Kerns was previously convicted of possession of a controlled substance, third or subsequent offense in the Iowa District Court for Pottawattamie County in August 2017.
Evidence at the guilty plea and sentencing showed that from January 2017 through February 2018, Kerns was involved in a conspiracy that distributed nearly three pounds of methamphetamine in and around the Cherokee, Iowa area. On February 27, 2018, Kerns was apprehended by law enforcement in Storm Lake, Iowa while attempting to meet with another meth dealer. Law enforcement seized $1,500 and 8 grams of methamphetamine from Kerns, which Kerns admitted he planned to distribute to other persons.
Kerns was sentenced in Sioux City by United States District Court Chief Judge Leonard T. Strand. Kerns was sentenced to 144 months’ imprisonment. He must also serve a four-year term of supervised release after the prison term. There is no parole in the federal system. Kerns is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Shawn S. Wehde and investigated by the Iowa Department of Narcotics Enforcement, Cherokee County Sheriff’s Office, Storm Lake Police Department, and the Iowa Division of Criminalistics Laboratory.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 18-4025.
Follow us on Twitter @USAO_NDIA.
Bordentown, New Jersey, Woman and Philadelphia Man Admit Roles in Scheme to Launder Money, Defraud Internet DonorsRead the Press Release
CAMDEN, N.J. - A Bordentown, New Jersey, woman and a Philadelphia man today admitted their respective roles in a GoFundMe scam that gained nationwide attention, U.S. Attorney Craig Carpenito announced.
Katelyn McClure, 28, pleaded guilty before U.S. District Judge Jerome B. Simandle in Camden federal court to an information charging her with one count of conspiracy to commit wire fraud. Johnny Bobbitt, 36, pleaded guilty to an information charging him with one count of conspiracy to commit money laundering.
According to documents filed in this case and statements made in court:
In November 2017, McClure and Mark D’Amico allegedly created a crowd-source funding page on GoFundMe’s website titled “Paying It Forward.” The campaign solicited donations from the public purportedly for the benefit of a homeless veteran, Bobbitt. McClure and D’Amico posted a story that McClure was driving home from Philadelphia on Interstate 95 and ran out of gas. Bobbitt acted as a “good Samaritan” and rescued McClure by using his last $20 to buy gasoline for her. The website stated that funds were being solicited to get Bobbitt off the streets and provide him with living expenses, setting a goal of $10,000.
In reality, McClure never ran out of gas and Bobbitt never spent his last $20 for her. D’Amico and McClure allegedly conspired to create the false story to obtain money from donors. The story was quickly picked up by local and national media outlets and went viral and raised approximately $400,000 from more than 14,000 donors in less than three weeks.
The donated funds were transferred by D’Amico and McClure from GoFundMe into accounts that they controlled. The majority of the money allegedly was quickly spent by D’Amico and McClure on personal expenses over the next three months, including significant amounts on D’Amico’s gambling, vacations, a BMW automobile, clothing, expensive handbags and other personal items and expenses.
In mid-November of 2017, when the donations had reached approximately $1,500, D’Amico and McClure told Bobbitt about the campaign and the false gas story. In December of 2017, after setting up a bank account for Bobbitt, D’Amico and McClure deposited $25,000 of proceeds of the scheme into Bobbitt’s account.
The count of wire fraud conspiracy to which McClure pleaded guilty carries a maximum potential penalty of 20 years in prison and a $250,000 fine. Sentencing is scheduled for June 19, 2019.
The count of conspiracy to commit money laundering to which Bobbitt pleaded guilty carries a maximum penalty of 10 years in prison and a fine of $250,000. Sentencing will be scheduled at a later date.
U.S. Attorney Carpenito credited assistant prosecutors and detectives of the Burlington County Prosecutor’s Office, under the direction of Prosecutor Scott Coffina; officers of the Florence Township Police Department; special agents of IRS-Criminal Investigation, under the direction of Special Agent in Charge John R. Tafur; and special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation leading to today’s guilty pleas.
The government is represented by Assistant U.S. Attorney Jason M. Richardson of the U.S. Attorney’s Office Criminal Division in Camden.
Defense counsel: McClure: James J. Gerrow Jr. Esq., Hainesport, New Jersey
Bobbitt: Lori Koch Esq., Assistant Federal Public Defender, CamdenBergen County, New Jersey, Man Admits Distributing Images of Child Sexual AbuseRead the Press Release
NEWARK, N.J. – A Bergen County, New Jersey, man today admitted distributing images of child sexual abuse, U.S. Attorney Craig Carpenito announced.
Barry Goldstein, 46, of Bergenfield, New Jersey, pleaded guilty before U.S. District Judge Madeline Cox Arleo in Newark federal court to an information charging him with one count of distribution of images of child sexual abuse.
According to documents filed in this case and statements made in court:
From May 2018 through August 2018, an undercover law enforcement officer (the “UC”) communicated over an instant messaging mobile application (the “IM App”) with Goldstein. The IM App allows users to transmit and receive content after users register a username. Goldstein maintained an account on the IM App, which was accessed from Internet Protocol addresses associated with Goldstein’s home.
In May and June 2018, after engaging in explicit conversations with the UC regarding the sexual abuse of children, Goldstein used his account on the IM App to share with the UC multiple files depicting child sexual abuse. On Aug. 29, 2018, law enforcement officers searched Goldstein’s residence, interviewed Goldstein and arrested him.
The count of distributing child pornography carries a mandatory minimum sentence of five years in prison, a maximum potential penalty of 20 years in prison, and a $250,000 fine. Sentencing is scheduled for June 6, 2019.
U.S. Attorney Carpenito credited special agents of U.S. Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI), under the direction of Special Agent in Charge Brian Michael, with the investigation leading to today’s guilty plea.
The government is represented by Executive Assistant U.S. Attorney Zach Intrater of the U.S. Attorney’s Office in Newark.
Bankrate Inc.’s Successor in Interest Agrees to Pay $28 Million to Resolve Securities and Accounting Fraud ChargesRead the Press Release
Baton Holdings LLC, as the successor in interest to Bankrate Inc., a financial services and marketing company (Bankrate), has entered into a nonprosecution agreement and agreed to pay $28 million in combined monetary penalties and restitution to resolve the government’s investigation into a complex accounting and securities fraud scheme carried out by former executives of Bankrate.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Ariana Fajardo Orshan of the Southern District of Florida and Inspector in Charge Delany DeLeon-Colon of the U.S. Postal Inspection Service made the announcement.
Bankrate admitted in the resolution documents that former executives engaged in a complex scheme to artificially inflate Bankrate’s earnings through so-called “cookie jar” or “cushion” accounting, whereby millions of dollars in unsupported expense accruals were purposefully left on Bankrate’s books and then selectively reversed in later quarters to boost earnings. In addition, Bankrate admitted that former executives misrepresented certain company expenses as “deal costs” in order to artificially inflate publicly reported adjusted earnings metrics, and also made materially false statements to Bankrate’s independent auditors to conceal the improper accounting entries. As a result of the scheme, Bankrate admitted that the fraudulent conduct caused Bankrate’s shareholders to suffer at least $25 million in losses. According to the resolution documents, Red Ventures Holdco LP, which acquired Bankrate in November 2017 after the securities and accounting fraud scheme took place, also agreed to certain terms and obligations under the agreement but had no involvement in the underlying criminal conduct.
“Today’s resolution with Bankrate’s successor in interest—together with the previously announced convictions of the company’s CFO and vice president of finance—closes the books on an accounting fraud that caused more than $25 million in losses to the company’s shareholders,” said Assistant Attorney General Benczkowski. “This case reflects the Department’s commitment to holding both individuals and institutions accountable for fraudulent conduct, and to obtaining restitution for the victims of fraud.”
“The U.S. Postal Inspection Service has an extensive history of investigating complex financial fraud schemes in order to protect investors as well as the integrity of the financial marketplace from fraudulent activities by trusted insiders who abuse their positions,” said Inspector in Charge DeLeon-Colon. “Anyone who engages in this type of financial fraud scheme should know they will be found and they will be held accountable.”
Bankrate Inc.’s former CFO, Edward J. DiMaria, previously pleaded guilty for his role in the scheme and was sentenced by Chief U.S. District Judge K. Michael Moore of the Southern District of Florida to serve 10 years in prison and ordered to pay $21,234,214 in restitution. Hyunjin Lerner, Bankrate’s former vice president of finance, also previously pleaded guilty for his role in the scheme and was sentenced by Judge Moore to serve 30 months in prison and ordered to pay $21,234,214 in restitution.
The U.S. Postal Inspection Service’s Washington, D.C. Division investigated the case. Principal Assistant Chief Henry Van Dyck and Trial Attorneys Emily Scruggs and Jason Covert of the Criminal Division’s Fraud Section prosecuted the case, with assistance from the U.S Attorney’s Office for the Southern District of Florida. The SEC also provided assistance in this matter.
Potential victims of the scheme can find information about their rights under relevant law at the following website: https://www.justice.gov/criminal-vns/case/edward-j-dimaria.
Arkansas Man Must Pay $25,000 After Conviction for Interstate Transportation of Stolen PropertyRead the Press Release
OKLAHOMA CITY – BRANDON BYRGE, 29, of Texarkana, Arkansas, has been sentenced to two years of probation and ordered to pay $25,000 for interstate transportation of stolen property, announced Robert J. Troester of the U.S. Attorney’s Office.
On June 5, 2018, a federal grand jury charged Byrge with transporting two drill bits from Oklahoma to Arkansas when he knew they had been stolen, converted, and taken by fraud. According to the indictment, the two bits were worth approximately $39,000.
Byrge pleaded guilty on August 6, 2018.
On February 26, 2019, U.S. District Judge Scott L. Palk sentenced Byrge to two years of probation and ordered him to pay $20,000 in restitution and a fine of $5,000. On March 5, the court amended its judgment by ordering that of the $20,000 in restitution, $18,000 go to Smith International, Inc., of Sugar Land, Texas, and $2,000 go to Bayless Sales & Services of Weatherford, Oklahoma. These amounts reflect the costs to the companies of temporarily not having access to the drill bits, which ultimately were recovered.
This case is the result of an investigation by the FBI Major Theft Task Force, which consists of the FBI, the Oklahoma State Bureau of Investigation, and the Oklahoma Department of Agriculture. Assistant U.S. Attorney Edward J. Kumiega prosecuted the case.
Reference is made to public filings for further information.
Albany Man Sentenced to 63 Months for Intending to Distribute Heroin, Cocaine and Crack CocaineRead the Press Release
ALBANY, NEW YORK –Dwayne G. Perkins, age 38, of Albany, was sentenced today to 63 months in prison, to be followed by 4 years of supervised release, for possessing and intending to distribute heroin, cocaine and more than 28 grams of crack cocaine.
The announcement was made by United States Attorney Grant C. Jaquith and James N. Hendricks, Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI).
Perkins was convicted following a 3-day jury trial in September 2018 presided over by United States District Judge Mae A. D’Agostino. The trial evidence established that the FBI and other law enforcement executed a search warrant on Perkins’s Albany apartment on April 4, 2017. An FBI Agent searched Perkins and found him to be hiding, in bags attached to his underwear, what turned out to be approximately 42 grams of crack cocaine, 36 grams of cocaine, and 7.5 grams of heroin mixed with fentanyl. Agents also seized, from the apartment, two digital scales and $1,746 in cash.
This case was investigated by the FBI and its Capital District Safe Streets Gang Task Force, which includes FBI Special Agents and members of federal, state and local law enforcement agencies, including the New York State Police, the New York Department of Corrections and Community Supervision, and the Albany Police Department. This case was prosecuted by Assistant U.S. Attorney Michael Barnett.
Akron man pleaded guilty to launching denial of service attacks that shut down web sites for the city of Akron and the Akron Police DepartmentRead the Press Release
An Akron man pleaded guilty to launching denial of service attacks that shut down web sites for the city of Akron and the Akron Police Department.
James Robinson, 33, is scheduled to be sentenced July 1. He pleaded guilty to damaging protected computers.
According to court documents filed in the case:
Servers hosting web sites belonging to the city of Akron were victims of an active distributed denial of service (DDoS) attack on Aug. 1, 2017. Two website domains appeared to be the target of the attacks: akronohio.gov and akroncops.org.
The DDoS attack ultimately overwhelmed the web sites with network traffic and rendered them unavailable to users.
A tweet that same day from @AkronPhoenix420 took credit for targeting the Akron web sites, including a link to a youtube video and a screenshot showing akronohio.gov was not accessible. The tweet included hashtags #Anonymous and #TangoDown.
The video showed a static image of an individual in a Guy Fawkes mask making statements including “it’s time we teach the law a lesson,” “Akron PD abuses the law” and “this week the city of Akron experienced system failures on multiple domains including their emergency TCP ports.”
The subsequent investigation identified attacks coming from an Internet connection registered to James Robinson and that Robinson’s phone was associated with the Twitter account @AkronPhoenix420.
@AkronPhoenix420 also claimed credit for many other DDoS attacks including many in 2018 that bore similar characteristics to the Akron attacks. Targets of those attacks web site domains and servers hosted by the Ohio Department of Public Safety, the National Institutes of Health, the Defense Information Security Agency, the Department of Defense, the Department of Treasury and others. Multiple DDoS attacks have been claimed by AkronPhoenix420, including many in 2018.
Law enforcement authorities got a search warrant for Robinson’s house on Edison Avenue in Akron in May 2018. Agents located a Guy Fawkes mask and a cell phone with a cracked screen similar to a phone seen in tweets by @AkronPhoenix420. Robinson stated he was responsible for the DDoS attacks against the Department of Defense, city of Akron and others, according to court documents.
This case is being investigated by the Federal Bureau of Investigation, Defense Criminal Investigative Services, Akron Police Department, Ohio State Highway Patrol, Department of Health and Human Services and Department of Treasury. It is being prosecuted by Assistant U.S. Attorneys Om Kakani and Daniel J. Riedl.
Additional affiliates of Ghost Face Gangsters street gang plead guilty to federal chargesRead the Press Release
SAVANNAH, GA: Seventeen additional defendants indicted on drug trafficking and firearms charges as part of Operation Vanilla Gorilla have pled guilty in federal court, bringing to 33 the total number of guilty pleas only months after charges were filed.
Operation Vanilla Gorilla, an investigation by the Organized Crime Drug Enforcement Task Forces (OCDETF), targeted the notorious Ghost Face Gangsters, a violent criminal street gang largely operated from inside Georgia’s prison system. The multi-agency federal, state and local operation netted 46 indictments on federal charges, primarily for drug trafficking and illegal firearms possession, said Bobby L. Christine, U.S. Attorney for the Southern District of Georgia.
Indictments were handed down in November and December 2018 in U.S. District Court in Savannah. Sixteen of the defendants pled guilty in February, and 17 more have since entered guilty pleas in U.S. District Court. They include:
- Christopher Hendrix, a/k/a “Hot Boy” and “Irish,” 40, of Helena, Ga., pled guilty to Conspiracy to Possess with Intent to Distribute 5 grams or more of Methamphetamine and Heroin, and faces five to 40 years in prison. In court, Hendrix admitted that he was the “capo” for the Ghost Face Gangsters who was brought to this district to get gang members “on track.” He has tattoos of horns on his head, the “G” tattooed on his neck and “Vanilla Gorilla” tattooed on his chest;
- Cody Penfield, 28, of Savannah, Ga., pled guilty to Conspiracy to Possess with Intent to Distribute 50 Grams or More of Methamphetamine. He faces 10 years to life in prison;
- Nick Penfield, a/k/a “Picnic,” 22, of Pooler, Ga., pled guilty to Conspiracy to Possess with Intent to Distribute 5 Grams or More of Methamphetamine, and faces five to 40 years in prison;
- Waylon Jesse Hodges, 41, of Pembroke, Ga., pled guilty to Conspiracy to Possess with Intent to Distribute Methamphetamine, and faces up to 20 years in prison;
- Trevor Aines, a/k/a “Sticks,” 29, of Garden City, Ga., pled guilty to Conspiracy to Possess Five Grams or More of Methamphetamine and Felon in Possession of a Firearm, and faces up to life in prison;
- Marcos Logan-Greco, 28, of Richmond Hill, Ga., pled guilty to Conspiracy to Possess with Intent to Distribute Methamphetamine and Heroin, and Possession of a Firearm by a Convicted Felon, and faces up to life in prison;
- Jennifer J. Grooms, 36, of Ellabell, Ga., pled guilty to Conspiracy to Possess with Intent to Distribute Methamphetamine, and faces up to 20 years in prison;
- Kimberlin Johnson, 24, of Rincon, Ga., pled guilty to Distribution of Alprazolam (Xanax) and Distribution of Hydrocodone and faces up to 20 years in prison;
- Dillon Myrick, a/k/a “Country Crack,” 31, of Savannah, Ga pled guilty to Conspiracy to Possess with Intent to Distribute Methamphetamine, and faces up to 20 years in prison;
- Robert Fuller, a/k/a “Robbie,” 39, of Richmond Hill, Ga., pled guilty to Conspiracy to Possess with Intent to Distribute Methamphetamine, and faces up to 20 years in prison;
- Baby Dwayne Garrison, 55, of Bloomingdale, Ga., pled guilty to Conspiracy to Possess with Intent to Distribute Methamphetamine, and faces up to 20 years in prison;
- Joseph Britt Carter, a/k/a “Crack,” 29, of Savannah, Ga., pled guilty to Conspiracy to Possess with Intent to Distribute Methamphetamine, and Possession of a Firearm by a Drug User, and faces up life in prison;
- Cody Tracy, a/k/a “Cojack,” 33, of Guyton, Ga., pled guilty to Conspiracy to Possess with Intent to Distribute Methamphetamine, and faces up to 20 years in prison;
- Andrew P. Campos, a/k/a “Chubs,” 28, of Richmond Hill, Ga., pled guilty to Conspiracy to Possess with Intent to Distribute Methamphetamine and Possession of a Firearm by a Convicted Felon, and faces up to life in prison; and,
- Rodney Rose, 39, of Bloomingdale, Ga., pled guilty to Conspiracy to Possess with Intent to Distribute Methamphetamine, and faces up to 20 years in prison.
The guilty pleas of two additional defendants have been sealed by the court.
The indictments allege that the narcotics-trafficking conspiracy began as early as 2015, operating in Bryan, Chatham, Effingham, Emmanuel, Evans, and Tattnall Counties, in the Southern District of Georgia, and elsewhere. Members of the conspiracy associated with the Ghost Face Gangsters and with other criminal street gangs to aid in the distribution of controlled substances, for protection, and to promote a climate of fear.
Operation Vanilla Gorilla represents one of the largest-ever takedowns of Ghost Face Gangsters associates.
“The swift resolution of these cases with guilty pleas demonstrates the effectiveness of the investigation and the prosecution team,” said Bobby L. Christine, U.S. Attorney for the Southern District of Georgia. “The investigators and our OCDETF prosecutors have done an outstanding job, and their work in dismantling violent criminal street gangs will continue to make our communities safer.”
Robert J. Murphy, Special Agent in Charge, Atlanta Field division stated, “DEA is committed to making our communities safer and these results demonstrate the agency’s resolve in confronting violent criminals locally, nationally and internationally.”
“This case is a great example of how you leverage law enforcement resources to target the offenders driving crime in the region,” said Beau Kolodka, Assistant Special Agent in Charge of the Atlanta Field Division of the bureau of Alcohol, Tobacco, Firearms and Explosives.
Operation Vanilla Gorilla was investigated under the Organized Crime Drug Enforcement Task Forces (OCDETF), the centerpiece of the United States Attorney General’s drug strategy to reduce the availability of drugs by disrupting and dismantling major drug trafficking and money laundering organizations and related criminal enterprises. The case was investigated by the bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the Drug Enforcement Administration (DEA), the Georgia Bureau of Investigation (GBI), the Chatham County Narcotics Team (CNT), the Georgia Department of Corrections Intelligence Division, the Savannah Police Department, the Chatham County Sheriff’s Office, the Bryan County Sheriff’s Office, the Richmond Hill Police Department, the Pooler Police Department, the Effingham County Sheriff’s Office and the Bloomingdale Police Department, with assistance from the U.S. Marshals Service.
The case is being prosecuted by Assistant United States Attorneys E. Greg Gilluly Jr. and Frank Pennington.
Active Duty Soldier at JBLM Arrested on Charges He Traveled to Foreign Country for Sex with ChildrenRead the Press Release
A 37-year-old Staff Sergeant stationed at Joint Base Lewis-McChord (JBLM) was arrested today on a criminal complaint charging him with traveling with the intent to engage in illicit sexual contact and possession of child pornography, announced U.S. Attorney Brian T. Moran. MOEUN YOEUN made his initial appearance in U.S. District Court in Tacoma this morning following his arrest at JBLM. YOEUN had been residing in Steilacoom, Washington. YOEUN will remain in custody pending a detention hearing next week.
According to the criminal complaint, YOEUN came to the attention of law enforcement when Facebook notified the National Center for Missing and Exploited Children (NCMEC) that a person associated with four user accounts was enticing minors to send images of sexually explicit conduct and was making travel plans to go to the Philippines to engage in sex with minors. The messages linked to the account indicate YOEUN traveled to the Philippines in February 2019.
The charges contained in the indictment are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
Traveling with intent to engage in illicit sexual conduct is punishable by up to 30 years in prison. Possession of child pornography is punishable by up to 20 years in prison..The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes. If convicted, the sentence of the defendant will be determined by the court based on the advisory Sentencing Guidelines and other statutory factors.
FBI and U.S. Army CID are investigating the case as part of the South Sound Child Exploitation Task Force. The case is being prosecuted by Assistant United States Attorneys Matthew Hampton and Grady Leupold.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc
5 March 2019
Woodburn Man Pleads Guilty for Role in Conterfeit ID SchemeRead the Press Release
PORTLAND, Ore.—Miguel Merecias-Lopez, 24, of Woodburn, Oregon, pleaded guilty today to one count each of conspiracy to produce false identification documents and possession with intent to distribute methamphetamine.
According to court documents, from a time unknown until September 21, 2017, Merecias-Lopez and other co-conspirators were part of a Oaxaca, Mexico-based criminal conspiracy to produce and sell fraudulent U.S. government documents.
Conspirators, including Merecias-Lopez, maintained a clandestine photo lab in Woodburn where they used various computers, scanners, laminators, digital cameras and a high-resolution printer to produce the fraudulent documents. They would communicate with customers in-person and electronically via email, Facebook and Snapchat, and receive payments via PayPal, U.S. mail or in person.
On September 21, 2017, investigators arrested Merecias-Lopez in a fast food parking lot in Woodburn when he arrived to conduct a drug deal. More than a kilogram of methamphetamine was found on Merecias-Lopez’s person. A subsequent search of Merecias-Lopez’s apartment produced additional methamphetamine and equipment used in furtherance of the fraudulent document scheme. Investigators found and seized the materials needed to produce thousands of identification cards.
A review of electronic devices found in Merecias-Lopez’s apartment produced evidence that the conspiracy had operated in Woodburn for more than a decade and produced and sold more than 10,000 different fraudulent documents including driver’s licenses for more than 25 states, U.S. social security cards, immigration-related documents including non-immigrant visas and legal permanent resident cards, marriage licenses, vehicle bills of sale and titles, and birth certificates. Merecias-Lopez was personally responsible for producing more than 300 fraudulent U.S. government documents.
A charge of conspiracy to produce false identification documents carries a maximum sentence of 15 years in prison, a $250,000 fine and three years’ supervised release. A charge of possession with intent to distribute methamphetamine carries of maximum sentence of life in prison with a 10 year mandatory minimum sentence, a $10,000,000 fine and five years’ supervised release.
The government and defense counsel representing Merecias-Lopez are jointly recommending a sentence on the low-end of the non-binding U.S. Sentencing Commission guidelines range when he is sentenced on June 18, 2019 before U.S. District Court Judge Michael H. Simon.
This case was investigated by Homeland Security Investigations (HSI), the U.S. Drug Enforcement Administration (DEA), the Westside Interagency Narcotics Team (WIN), the Clackamas County Interagency Task Force (CCITF) and the Woodburn Police Department. It is being prosecuted by Peter D. Sax, Assistant U.S. Attorney for the District of Oregon.
White River Woman Sentenced for Assault with a Dangerous WeaponRead the Press Release
United States Attorney Ron Parsons announced that Crystal Earth, age 26, of White River, South Dakota, convicted of Assault With a Dangerous Weapon was sentenced on March 4, 2019, by United States District Judge Roberto A. Lange.
Earth was sentenced to 42 months in federal prison, 3 years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Earth was indicted by a federal grand jury on April 17, 2018. She was convicted on December 14, 2018, following a four-day jury trial in Pierre, South Dakota.
The conviction stems from an incident that occurred on February 26, 2018, in the Horse Creek Community near White River. On that date, Earth was at her home in Horse Creek drinking alcoholic beverages and socializing with a group of people that included the victim. At one point, Earth and the victim, an adult male, got into an argument. Earth took a knife from the kitchen and repeatedly stabbed the victim in the chest and face, causing multiple puncture wounds to the victim’s chest and a deep laceration to his chin.
This case was investigated by the Rosebud Sioux Tribe Law Enforcement Services. Assistant U.S. Attorneys Kirk Albertson and Cameron Cook prosecuted the case.
Earth was immediately remanded to the custody of the U.S. Marshals Service.
Waterloo Gang Member Sentenced to over One Year for Illegally Possessing AmmunitionRead the Press Release
A man who illegally possessed ammunition was sentenced today to more than one year in federal prison.
Daejon Putman, age 22, from Waterloo, Iowa, received the prison term after an October 23, 2018, guilty plea to being a drug user in possession of ammunition.
Evidence during the case showed police executed a search warrant at Putman’s residence and located a single round of .40 caliber ammunition in his bedroom. Putman was also involved in distributing marijuana and Xanax and was a member of the Del Mob street gang in Waterloo.
Putman was sentenced in Cedar Rapids by United States District Court Judge C.J. Williams. Putman was sentenced to 12 months’ and one day imprisonment. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
This case was brought as part of Project Safe Neighborhoods (PSN). PSN is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing 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.
Putman is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Lisa C. Williams and investigated by a Federal Task Force composed of the Waterloo Police Department, Federal Bureau of Investigation, and Bureau of Alcohol Tobacco and Firearms assisted by the Black Hawk County Sheriff’s Office and Cedar Falls Police Department.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 18-cr-2048.
Follow us on Twitter @USAO_NDIA.
Waterbury Investment Advisor Charged with Additional Counts Related to $1 Million Fraud SchemeRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that a federal grand jury in New Haven returned a 21-count indictment today charging LEON C. VACCARELLI, 42, of Waterbury, with fraud and money laundering offenses stemming from an investment scheme that defrauded individuals of more than $1 million.
On May 2, 2018, a grand jury returned a 12-count indictment charging Vaccarelli with three counts of mail fraud, six counts of wire fraud and three counts of money laundering. The superseding indictment adds an additional three counts of wire fraud and six counts of securities fraud.
As alleged in the superseding indictment, Vaccarelli was a registered representative of The Investment Center (“TIC”), a brokerage company, and was an investment adviser associated with IC Advisory Services, Inc. (“IC Advisory”). He also was the owner and only member of LWLVACC, LLC, and conducted business through an entity named Lux Financial Services (“Lux Financial”). Using these various entities, Vaccarelli operated a financial advisory and brokerage service through which he offered investment advice and sold investments and securities to individuals and families in the Waterbury area.
Between approximately 2011 and 2017, it is alleged that Vaccarelli defrauded victim investors of more than $1 million by falsely representing that he would invest his clients’ money in IRA rollover accounts, money market accounts, certificates of deposit (“CDs”), or other types of interest-earning investments. However, instead of investing customers’ funds as he had represented, Vaccarelli deposited customer funds into his own personal account and business bank accounts, commingled those funds with his own money, and used the funds to pay both business and personal expenses, including tuition and mortgage payments. In some instances, he also used customer funds to make bogus “interest payments” to other victim-investors.
Mail fraud, wire fraud and securities fraud carry a maximum term of imprisonment of 20 years on each count. Money laundering carries a maximum term of imprisonment of 10 years on each count.
Vaccarelli is released on a $100,000 bond pending trial.
U.S. Attorney Durham stressed that an indictment is not evidence of guilt. Charges are only allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This matter is being investigated by the Federal Bureau of Investigation and U.S. Postal Inspection Service. The case is being prosecuted by Assistant U.S. Attorneys Michael S. McGarry and Jennifer R. Laraia.
Washington D.C. Commercial Sex Customer Pleads Guilty to Sex Trafficking of a MinorRead the Press Release
Baltimore, Maryland –Leon R. Harrison, age 56, of Washington D.C., pleaded guilty today to sex trafficking of a minor, for having sex with a 15-year-old girl in exchange for money.
The guilty plea was announced by United States Attorney for the District of Maryland Robert K. Hur; Acting Special Agent in Charge Cardell T. Morant of ICE Homeland Security Investigations (HSI); Chief Tim Altomare of the Anne Arundel County Police Department; and Anne Arundel County State’s Attorney Anne Colt Leitess.
“Children cannot consent to have sex for money, and any adult who encourages or profits from sexual exploitation of children faces a lengthy term in federal prison,” said U.S. Attorney Robert K. Hur.
According his plea agreement, between August 9, 2016 and February 7, 2018, Harrison used his Facebook account to send messages to hundreds of other Facebook users, offering them money in exchange for sending him sexually explicit pictures, watching him masturbate, or meeting with him in person to engage in commercial sex. Several Facebook users told Harrison that they were under 18 years old, and as young as 12 years old. Harrison continued to make the requests even after they stated that they were minors.
Harrison admitted that he met Girl 1 online and began engaging in commercial sex with Girl 1 beginning in 2016 or 2017, when she would have been 13 or 14 years old.
On October 9, 2017, Harrison and Girl 1 reconnected on Facebook, after a period of not communicating with each other. Between October 9, 2017, and February 7, 2018, Harrison and Girl 1 exchanged hundreds of messages over Facebook. At that time, Girl 1 was at a 15-year-old tenth-grade student in Maryland. In the messages, Harrison repeatedly offered to pay Girl 1 in exchange for having sex with him. In twelve instances, Harrison offered her between $40 and $60 for sex.
On February 6, 2018, Girl 1’s mother discovered the Facebook messages and contacted the police. That day, an undercover police detective began operating Girl 1’s Facebook account.
On February 7, 2018, Harrison continued communicating with Girl 1’s Facebook account. Harrison stated that he would meet with Girl 1 that evening, and that he would bring money and condoms. Harrison stated he would pay Girl 1 $50 to have sex with him and made arrangements to meet with Girl 1 at a restaurant in Odenton, Maryland. Harrison agreed that he would get Girl 1 home before 1:00 a.m. because it was a “school night.” Harrison described the sex acts he wished to engage in with Girl 1 and what he wanted her to wear when they met. Harrison also asked to engage in sexual contact with Girl 1 without a condom.
When he arrived at the restaurant, Harrison had condoms, $50 in cash, and two 50ml bottles of flavored vodka in his pants pockets. Harrison was arrested in the parking lot. Following his arrest, Harrison was interviewed by law enforcement officers and admitted that he is HIV-positive, and that he does not disclose that fact to his sexual partners.
As part of his plea agreement, Harrison must register as a sex offender in the places where he resides, where he is an employee, and where he is a student, under the Sex Offender Registration and Notification Act (SORNA).
Harrison and the government have agreed that if the Court accepts the plea, Harrison will be sentenced to between 10 and 16 years in federal prison. U.S. District Judge Catherine C. Blake has scheduled sentencing for May 29, 2019, at 9:15 a.m.
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 Attorney’s 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. For more information about Internet safety education, please visit www.justice.gov/psc and click on the "Resources" tab on the left of the page.
United States Attorney Robert K. Hur commended HSI, the Anne Arundel County Police, and the Anne Arundel State’s Attorney’s Office for their work in the investigation. Mr. Hur thanked Assistant U.S. Attorneys Zachary A. Myers and Ray D. McKenzie, who are prosecuting the case.
# # #
U.S. Obtains over $25 Million in Forfeited Funds as Part of a Successful Effort to Root Out Fraud and Corruption in Government Contracting in AfghanistanRead the Press Release
The Department of Justice has reached a settlement of its civil forfeiture case against assets owned by Hikmatullah Shadman that he wrongfully acquired as a government contractor in Afghanistan. Under the terms of the settlement, approximately $25 million will be forfeited to the United States. The civil settlement is part of a global settlement that involved the resolution of a criminal case and False Claims Act allegations.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, Assistant Attorney General Jody Hunt of the Department’s Civil Division, U.S. Attorney Robert J. Higdon Jr. for the Eastern District of North Carolina, Inspector General John F. Sopko of the Special Inspector General for Afghanistan Reconstruction (SIGAR), Director Frank Robey of the U.S. Army Criminal Investigation Command (CID)’s Major Procurement Fraud Unit, Special Agent in Charge Robert E. Craig Jr. of the Defense Criminal Investigative Service (DCIS) Mid-Atlantic Field Office and Special Agent in Charge John A. Strong of the FBI North Carolina Field Office made the announcement after the settlement was signed and filed with the U.S. District Court for the District of Columbia.
“The United States relies on government contractors to supply and resupply our military with vital resources they require to carry out critical missions,” said Assistant Attorney General Hunt. “We will continue to ensure that companies and individuals who contract directly or indirectly with the federal government do not engage in fraudulent business practices at the expense of our nation’s military and the American taxpayer.”
“The success of our overseas war and reconstruction efforts is tied directly to the trust and respect established with the local populace,” said U.S. Attorney Higdon. “Corruption in our military operations undermines those efforts and cannot be tolerated.”
“This case involved fraud and corruption that exploited subcontracts designed to support American troops in a conflict zone,” said Special Inspector General John F. Sopko. “I’m proud of the tenacity displayed by SIGAR special agents, whose dogged pursuit of justice led to the return of $25 million to the United States Treasury.”
According to court documents, Hikmatullah Shadman, a young Afghan national, operated several companies including Hikmat Shadman Logistics Services Company (HSLSC), which served as subcontractors delivering supplies to U.S. service members at various locations in Afghanistan. From November 2010 to March 2012, Shadman charged the United States more than $77 million for delivering supplies to U.S. service members. The civil forfeiture case, initially filed on Nov. 20, 2012, targeted, among other things, Shadman’s fraudulent receipt of a disproportionate number of subcontracts for the transport of military supplies in Afghanistan, as well as the inflated prices that he charged the United States for such transport.
From at least 2007 to 2012, the U.S. Government paid contractors and subcontractors to resupply U.S. military forces operating in Afghanistan, and utilized local Afghan-owned businesses to transport fuel and other supplies by truck to various locations throughout the country. The investigation revealed thousands of apparent falsified documents submitted by Shadman’s companies to the United States for payment. As a result of this falsification, the Government often paid Shadman for work that was never performed and for work other than that described in the documentation submitted. Through his companies, Shadman also charged the United States rates which were well above the average rate of his competitors. The forensic analysis conducted in this case revealed that Shadman overcharged the United States millions of dollars for transporting supplies to U.S. service members in Afghanistan.
As part of the global settlement, several companies owned and controlled by Shadman, including HSLSC, entered into a separate agreement with the United States to resolve False Claims Act allegations arising from kickbacks paid from November 2010 to May 2012 to obtain subcontracts to transport military supplies needed by the U.S. military in Afghanistan. Under the agreement, $1.5 million of the forfeited funds will be paid to resolve these claims.
In addition to the civil forfeiture and False Claims Act resolutions, Shadman’s primary company, HSLSC, was criminally prosecuted by the U.S. Attorney’s Office in the Eastern District of North Carolina. On Jan. 3, HSLSC pleaded guilty to a criminal information, No. 5:18-cr-492-1, charging the corporation with two counts of paying gratuities to two U.S. service members in Afghanistan, and one count of conspiracy to do the same, in order to influence the award of subcontracts to HSLSC and to ensure favorable treatment in the contracting process. In this criminal case, HSLSC was sentenced to pay an $810,000 fine and forfeit $190,000. Under the terms of the civil settlement agreement agreed to by the parties, those funds will be paid to the United States before the civil settlement is concluded. As part of the criminal case, HSLSC also agreed to be placed on probation for five years, not to contest debarment, not to seek to engage in business within the United States, and its corporate officers agreed not to apply for a visa to travel to the United States.
“The corporate plea and the civil settlement filed today once again demonstrates that defrauding the government is a losing proposition,” said Director Robey of the U.S. Army CID’s Major Procurement Fraud Unit. “Stealing U.S. tax dollars meant to support our soldier’s readiness is an egregious abuse of trust. We, along with our law enforcement partners, will continue to protect the U.S. military from unscrupulous businesses.”
“DCIS will aggressively investigate complex fraud and corruption that undermines the integrity of the Department of Defense (DoD) no matter where it happens or how long it takes,” said DCIS Special Agent in Charge Craig. “We hope that this case demonstrates the commitment of DCIS and our law enforcement partners to use every available option to protect valuable DoD resources around the world and better enable our Warfighters to accomplish our critical global missions.”
This civil forfeiture case was brought under the Kleptocracy Asset Recovery Initiative by a team of dedicated prosecutors in the Criminal Division’s Money Laundering and Asset Recovery Section (MLARS), working in partnership with federal law enforcement agencies to forfeit the proceeds of foreign official corruption and, where appropriate, to use those recovered assets to benefit the people harmed by these acts of corruption and abuse of office. Individuals with information about possible proceeds of foreign corruption located in or laundered through the United States should contact federal law enforcement or send an email to [email protected].
The investigation was conducted by SIGAR along with the FBI, DCIS, the U.S. Army Major Procurement Fraud Unit, and the U.S. Air Force Office of Special Investigations, and was prosecuted by Trial Attorneys Patricia Kessler and Steven Parker of MLARS International Unit, and Assistant U.S. Attorney Elizabeth Aloi of the District of Columbia (formerly of MLARS). The HSLSC criminal case was prosecuted by Assistant U.S. Attorney Banu Rangarajan of the Eastern District of North Carolina.
The civil False Claims Act imposes treble damages and penalties on those who knowingly submit false or fraudulent claims for government funds or property. The False Claims Act investigation was handled by Trial Attorney Glenn Harris of the Department’s Civil Division, Commercial Litigation Branch, Fraud Section, and Assistant U.S. Attorneys John Truong and Heather Graham Oliver of the U.S. Attorney’s Office for the District of Columbia.