Latest Records
Newest first across public DOJ and U.S. Attorney press releases.
20 December 2018
Illegal alien from Honduras pleads guilty to re-entering the United States five timesRead the Press Release
LAFAYETTE, La. – United States Attorney David C. Joseph announced today that an illegal alien from Honduras pleaded guilty to illegally re-entering the country for a fifth time.
Selvin Ponce-Hernandez, 27, of Honduras, pleaded guilty before U.S. District Judge S. Maurice Hicks Jr. on one count of illegal re-entry of a removed alien. According to the indictment, Lafayette Parish Sheriff’s deputies arrested Ponce-Hernandez on August 9, 2018 for domestic abuse battery, possession of a stolen firearm and resisting an officer. The defendant’s wife reported the battery and deputies found him hiding in the closet of an abandoned apartment. The defendant was previously removed from the United States four times - November 2008, December 2009, January 2012 and October 2015. He also has two previous criminal convictions. He was convicted in August of 2008 of criminal mischief in Houston Texas, and in October 2009 in the Southern District of Texas for illegal re-entry of a removed alien.
Ponce-Hernandez faces up to 10 years in prison, three years of supervised release, a $250,000 fine, and possible deportation. Sentencing has been set for April 3, 2019.
Homeland Security Investigations, the ATF and the Lafayette Parish Sheriff’s Office investigated the case. Assistant U.S. Attorney David J. Ayo is prosecuting the case.
Honduran Man Sentenced for Immigration OffenseRead the Press Release
NEW ORLEANS, LOUISIANA – United States Attorney Peter G. Strasser announced thatJOSE ANGEL ESPINOZA-FUENTES, age 42, a native of Honduras, was sentenced yesterday after pleading guilty to a one-count indictment for illegal reentry of a removed alien.
United States District Court Judge Martin L.C. Feldman sentenced ESPINOZA-FUENTES to time served (6 months), a $2,500 fine, followed by one year of supervised release, and a $100 special assessment fee. The defendant will be surrendered to the custody of the U.S. Immigration and Customs Enforcement for removal proceedings.
According to court documents, on July 1, 2018, ESPINOZA-FUENTES was found in the United States after having been previously deported from the United States on July 22, 2011.
U.S. Attorney Strasser praised the work of Immigration and Customs Enforcement agents in investigating this matter. Assistant United States Attorney Jon Maestri is in charge of the prosecution.
* * *
Honduran Citizen Sentenced to Prison for Scheme to Facilitate Employment of Undocumented Aliens in Construction Industry and Evasion of Payroll Taxes and Workers’ Compensation LawsRead the Press Release
Jacksonville, Florida – United States District Judge Timothy J. Corrigan has sentenced Oscar Arnelson Rodriguez-Cruz (41, Orlando) to 27 months in federal prison for conspiracy to commit wire fraud and conspiracy to defraud the IRS of federal payroll taxes. The court also ordered Rodriguez-Cruz to forfeit $626,817, the amount of proceeds obtained as a result of the wire fraud offense, and to pay restitution to the IRS for a tax loss of $3,436,008. Rodriguez-Cruz is a Honduran citizen who is unlawfully present in the United States.
He had previously pleaded guilty to the offenses.
According to court documents, Rodriguez-Cruz engaged in a scheme through which construction contractors engaged the services of individuals who were living and working in the United States illegally. Rodriguez-Cruz formed a shell company that entered into agreements with the contractors to provide construction workers. By obtaining and paying the workers through the shell companies, the contractors disclaimed responsibility for ensuring that the workers were legally authorized to work in the United States, that required state and federal payroll taxes were paid, and that adequate workers’ compensation insurance was provided.
After creating the shell company, Rodriguez-Cruz applied for a workers’ compensation insurance policy that covered a one-year period. In the application, Rodriguez-Cruz represented that the policy would cover five employees and an estimated annual payroll of $121,000. The insurance company issued the policy, charging a premium of $20,473.
To pay the workers, the contractors wrote payroll checks to the shell company. Rodriguez-Cruz then cashed the checks and distributed the cash to crew leaders, who paid the workers in cash. No state or federal payroll taxes, such as for Medicare and Social Security, were deducted from the workers’ pay, in violation of Florida and federal law.
Rodriguez-Cruz kept approximately 4% of the amount of each payroll check as a fee. During the scheme, he cashed payroll checks for hundreds of workers totaling $15,670,438, with his 4% fee totaling $626,817. The annual premium for a workers’ compensation insurance policy covering that payroll amount would have totaled approximately $2,511,060. Had the total payroll been properly reported to the government, the payroll taxes due would have been approximately $3,436,008.
“This case is another example of HSI’s investigative expertise in worksite enforcement and financial crimes,” said HSI Tampa Special Agent in Charge James C. Spero. “HSI continues to identify, disrupt, and eliminate the criminal schemes used to exploit our financial industry and to garner profit from the labor of undocumented aliens.”
“Today’s sentence should send a message to those involved in the business of evading employment taxes,” said Special Agent in Charge Mary Hammond of the IRS Criminal - Investigation, Tampa Field Office. “Let this be a warning to all that law enforcement will not allow construction contractors to gain unfair advantage by breaking the law.”
This case was investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations and the Internal Revenue Service – Criminal Investigation. It was prosecuted by Assistant United States Attorney Arnold B. Corsmeier.
Hillsboro Man Pleads Guilty to Federal Charge After Stealing Labor Union FundsRead the Press Release
PORTLAND, Ore.—John Jason Burgess, 43, of Hillsboro, Oregon, pleaded guilty today to one count of concealing or destroying labor union records.
According to court documents, between 2008 and 2016, Burgess served as the president of Local 304, an independent labor union representing approximately 140 employees of Pacific Stainless Products (PSP), a manufacturer of stainless steel equipment headquartered in St. Helens, Oregon. Local 304 represents its members in negotiating with PSP on employment issues and, under the Labor-Management Reporting and Disclosure Act of 1959 (LMRDA), is required to file an annual financial report with the Secretary of Labor. Members fund the union entirely through biweekly dues of $12.50 withheld from their paychecks.
As president, Burgess was added as a signatory to Local 304’s bank account in 2011 and received a debit card linked to the account. At around the same time, Burgess assumed responsibility for maintaining the union’s financial records as required by LMRDA. Burgess was not authorized to draw any compensation for his duties as an officer of Local 304.
Burgess was fired from PSP in January 2016 and thus became ineligible to continue as a member or officer of Local 304. He surrendered his debit card linked to the union’s bank account, but did not produce or otherwise make available the financial records he had maintained during his time as president. Burgess admitted to abusing his position to convert to personal use more than $32,000 in union funds while failing to keep or disclose receipts relating to his unauthorized expenditures as required under LMRDA.
Burgess faces a maximum sentence of 12 months in prison, a $100,000 fine and a one-year term of supervised release. He will be sentenced on April 10, 2019, before U.S. District Court Judge Anna J. Brown. As part of the plea agreement, Burgess will pay restitution of no less than $10,600 to Local 304, as ordered by the court. Burgess has already repaid $21,580 to the union.
The U.S. Department of Labor, Office of Labor-Management Standards, investigated this case. It is being prosecuted by Ryan W. Bounds, Assistant U.S. Attorney for the District of Oregon.
Heroin Dealer Sentenced to 25 Years in Prison for Overdose Death of 25-Year-Old ManRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that FRANKIE BEQIRAJ was sentenced to 25 years in prison for leading a conspiracy to distribute heroin, cocaine, oxycodone, and alprazolam in the Bronx and Westchester. BEQIRAJ personally distributed heroin that resulted in the death of Robert Vivolo, a 25-year-old man from City Island, New York. BEQIRAJ was convicted after trial on June 11, 2018, before United States District Judge Richard M. Berman, who also imposed today’s sentence.
U.S. Attorney Geoffrey S. Berman said: “Frankie Beqiraj ran a crew of employees that distributed heroin throughout the City Island community, often hiring addicts and paying them in cash and drugs. His callousness and greed ultimately led to the overdose death of 25-year-old Robert Vivolo. Now, Beqiraj has been sentenced for his crimes and will spend significant time in prison.”
According to court documents and the evidence at trial:
From July 2016 to January 2017, BEQIRAJ was the principal drug supplier of the small Bronx community of City Island. BEQIRAJ employed workers, who were themselves heroin addicts and were supplied drugs by BEQIRAJ, to deliver narcotics to his customers using prepaid phones supplied by BEQIRAJ. These workers were paid their salaries in money and heroin. Through his organization, BEQIRAJ distributed large quantities of heroin, cocaine, oxycodone, and alprazolam.
On October 21, 2016, BEQIRAJ sold heroin to Robert Vivolo, a recovering heroin addict, on City Island, New York. BEQIRAJ’s heroin caused Vivolo to die from an overdose that night.
The Court also found that, on or about January 9, 2017, one of Beqiraj’s workers distributed heroin to three additional individuals, all of whom overdosed. One of those individuals died as a result of the overdose; the two others survived, having been revived with naloxone.
* * *
In addition to the prison term, BEQIRAJ, 28, of the Bronx, New York, was sentenced to five years of supervised release.
U.S. Attorney Berman praised the outstanding work of the New York City Police Department’s Bronx Narcotics Heroin Overdose Team, the New Rochelle Police Department, and the Special Agents of the U.S. Attorney’s Office for the Southern District of New York.
This matter is being handled by the Office’s Narcotics Unit. Assistant United States Attorneys David W. Denton Jr. and Elizabeth A. Hanft are in charge of the prosecution.
Harrison County man sentenced for drug distribution and firearm chargesRead the Press Release
CLARKSBURG, WEST VIRGINIA – James Bailey, of Clarksburg, West Virginia, was sentenced today to 36 months incarceration for drug distribution and firearm charges, United States Attorney Bill Powell announced.
Bailey, age 34, pled guilty to one count of “Distribution of Methamphetamine” and one count of “Use of a Firearm During and in Relation to a Drug Offense” in August 2018. Bailey admitted to selling methamphetamine and being in possession of a firearm during the drug offense in Harrison County in January 2018.
This case was brought as part of Project Safe Neighborhoods (PSN). Project Safe Neighborhoods 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.
Assistant U.S. Attorney Zelda E. Wesley prosecuted the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Greater Harrison County Drug & Violent Crimes Task Force, a HIDTA-funded initiative, investigated.
Senior U.S. District Judge Irene M. Keeley presided.Harrison County man admits to drug chargeRead the Press Release
CLARKSBURG, WEST VIRGINIA – Randall Lee Barker, of Mount Clare, West Virginia has admitted to drug distribution and was sentenced to 36 months probation, United States Attorney Bill Powell announced.
Barker, age 56, pled guilty to one count of “Distribution of Para-Fluorofentanyl.” The crime took place in Harrison County on November 13, 2016.
Assistant U.S. Attorney Andrew M. Cogar prosecuted the case on behalf of the government. The United States Postal Service Office of Inspector General, the West Virginia State Police, and the Greater Harrison Drug and Violent Crime Task Force, a HIDTA-funded initiative, investigated.
Senior U.S. District Judge Irene M. Keeley presided.
Gary Man Indicted for Disaster Relief FraudRead the Press Release
HAMMOND- Olanrewajua A. Beyioku, 38, of Gary, Indiana, was charged in an indictment with wire fraud, announced U.S. Attorney Kirsch.
U.S. Attorney Kirsch said, “At a time when individuals were going through some of the worst times in their lives, Mr. Beyioku seized the opportunity to enrich himself with hurricane relief funds meant for those who lost homes and businesses. My Office and our law enforcement partners will continue to investigate those who defraud the government for personal gain.”
The Indictment alleges that, in September and October 2017, Beyioku, a.k.a. “Papa Smith Morgan,” working in conjunction with others, known and unknown to the United States Attorney, devised a scheme to defraud the American Red Cross (“Red Cross”) by obtaining reference codes intended for nine different households directly impacted by Hurricane Harvey, and by using those codes to obtain $3,600 in hurricane relief funds.
According to the Indictment, on August 25, 2017, Hurricane Harvey struck the Houston, Texas area causing extensive damage. President Donald J. Trump declared it a federal disaster area that same day, which made federal disaster relief funds available to those affected by the storm.
One type of federal disaster relief was a one-time cash payment of $400 through the Red Cross. The Red Cross established a link on their website where hurricane victims could apply for the cash assistance. Hurricane victims used their email addresses to apply. They entered personally identifiable information, including their address. If the address fell within a designated disaster area, The Red Cross forwarded the application electronically to an entity referred to herein as “Company A.”
Company A vetted the information, and electronically forwarded it to “Company B.” Company B then created an eleven-digit alphanumeric code. The code was then sent to the applicant with instructions to redeem the code at a Wal-Mart Money Center or Customer Service Desk.
In early September 2017, The Red Cross received reports of ineligible people redeeming multiple reference codes at various Wal-Mart stores across the United States. The Red Cross reported this to the National Center for Disaster Fraud (“NCDF”). With assistance from Wal-Mart Global Security Investigators, The Red Cross identified over 3,300 instances of fraudulently obtained reference codes. The loss to The Red Cross is more than 1.3 million dollars.
The United States Attorney’s Office emphasizes that an Indictment is merely an allegation and that all persons are presumed innocent until, and unless proven guilty in court.
If convicted, any specific sentence to be imposed will be determined by the judge after consideration of federal sentencing statutes and the Federal Sentencing Guidelines.
This case is being investigated by the United States Secret Service. This case is being prosecuted by Assistant United States Attorney Jill R. Koster.
###
Fresno Residents Indicted for Aiming Laser Beam at CHP AircraftRead the Press Release
FRESNO, Calif. — A federal grand jury returned a two-count indictment today against Carlos Villa-Lozano, 30, and Paulina Silva Aguilar, 32, both of Fresno, charging them with aiming the beam of a laser pointer at a California Highway Patrol aircraft, U.S. Attorney McGregor W. Scott announced. Villa-Lozano was also charged separately with making false statements to an agent of the Federal Bureau of Investigation.
The indictment alleges that on July 22, 2018, Villa-Lozano and Silva used a dangerously bright green laser pointer to strike a CHP fixed-wing aircraft approximately 12 times. The indictment further alleges that Villa-Lozano materially misrepresented to the FBI agent that the laser device was used for one to two seconds “at most” and hit the aircraft only one time.
This case is the product of an investigation by the FBI and California Highway Patrol. Assistant U.S. Attorney Karen Escobar is prosecuting the case.
Villa-Lozano and Silva are scheduled for an arraignment on the indictment on December 21, 2018, in federal court in Fresno. If convicted, Villa-Lozano and Silva face a maximum statutory penalty of five years in prison and a $250,000 fine. If convicted of the false statement offense, Villa-Lozano faces an additional five years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.
Four Sentenced this Week for Conspiring to Distribute HeroinRead the Press Release
COVINGTON, Ky. – Courtney Webster, 34, of Cincinnati; Jonathan Stanley, 34, of Cincinnati; Keith Johnson, 35, of Alexandria, Kentucky; and Michael Boone, 45, of Newport, Kentucky, were sentenced this week, by United States District Judge David L. Bunning, for conspiring to distribute heroin. On Tuesday, Webster was sentenced to 240 months in federal prison and Stanley was sentenced to 51 months. Today, Johnson was sentenced to 90 months in federal prison and Boone was sentenced to 90 months.
Webster was convicted of leading the conspiracy, which included the other defendants and was responsible for distributing over a kilogram of heroin in Northern Kentucky and Cincinnati, from November 2016 through April 2018. Court documents established that Webster distributed heroin himself, and directed others who were selling heroin that he supplied. They also established that, during the course of the investigation, law enforcement agents conducted over 20 controlled buys of heroin from conspiracy members.
All four were indicted in April 2018 and entered guilty pleas. Under federal law, each defendant must serve at least 85 percent of their prison sentence; and following their release, they will be under the supervision of the United States Probation Office for an additional term.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; James Robert Brown, Jr., Special Agent in Charge, Federal Bureau of Investigation; and Robert Nader, Chief of the Covington Police Department, jointly made the announcement. The investigation was conducted by the FBI and the Covington Police Department. The United States was represented by Assistant United States Attorney Tony Bracke.
Four Defendants Sentenced for Roles in Fraud Scheme Against Starkey LaboratoriesRead the Press Release
United States Attorney Erica H. MacDonald today announced the sentencings of W. Jeffery Taylor, 57, Scott A. Nelson, 60, and Jeffery Longtain, 59, for their roles in the fraud scheme perpetrated against Starkey Laboratories, Inc. (Starkey) and its principal owner William F. Austin. Taylor was sentenced to 18 months of prison, Nelson was sentenced to 24 months of prison, and Longtain was sentenced to one year of probation. The defendants were sentenced today in United States District Court by Chief Judge John R. Tunheim. Jerome Ruzicka, 62, was sentenced on December 19, 2018 to 84 months of federal prison, by Chief Judge Tunheim.
“The sentencings today are a testament to the remarkable skill, dedication, and professionalism of our law enforcement partners,” said United States Attorney Erica H. MacDonald. “I am thankful for their unrelenting pursuit of justice during this investigation and trial.”
Taylor was convicted on March 3, 2018, following a nearly 8-week trial presided over by Chief Judge John R. Tunheim. Longtain pleaded guilty on April 20, 2017, to a criminal information charging him with one count of making and subscribing a false return. Nelson pleaded guilty on December 19, 2017, to a criminal information charging him with one count of conspiracy.
This case was the result of an investigation conducted by the FBI, Criminal Investigation Division of the IRS, and the United States Postal Inspection Service.
Assistant United States Attorneys Benjamin Langner and Surya Saxena, and former Assistant United States Attorney Lola Velazquez-Aguilu prosecuted the case.
Defendant Information:
Jerome C. Ruzicka, 61
Plymouth, Minn.
Convicted:
- Mail fraud, 4 counts
- Wire fraud, 3 counts
- Tax fraud, 1 count
Sentenced:- 84 months imprisonment
- 1 year supervised release
- Court will issue a restitution order
W. Jeffery Taylor, 57
Cologne, Minn.
Convicted:
- Mail fraud, 1 count
- Wire fraud, 2 counts
Sentenced:- 18 months imprisonment
- 2 years supervised release
Scott A. Nelson, 60
Prior Lake, Minn.
Convicted:
- Conspiracy to commit mail fraud and wire fraud, 1 count
Sentenced:- 24 months imprisonment
- 1 year supervised release
Jeffrey Lee Longtain, 58
West Linn, Ore.
Convicted:
- Marking and Subscribing a False Return, 1 count
Sentenced:
- One year of probation
###
Additional news available on our website.
Follow us on Twitter and Facebook.
United States Attorney’s Office, District of Minnesota: (612) 664-5600
Fort Myers Doctor Agrees to Pay More Than $1.7 Million to Resolve Allegations of FraudRead the Press Release
Fort Myers, FL – United States Attorney Maria Chapa Lopez announces that Dr. Jonathan Daitch, M.D. has agreed to a civil settlement that will pay $1.718 million to the United States to resolve allegations that he violated the False Claims Act by receiving illegal kickbacks associated with the provision of anesthesia services and by causing the submission of medically unnecessary urine tests.
During the relevant period, Dr. Daitch was a practicing interventional pain management specialist and one of two principal owners of Advanced Pain Management Specialists, P.A., which is located in Fort Myers. The other principal owner, Dr. Michael Frey, previously pleaded guilty to two counts of conspiracy to receive healthcare kickbacks and has agreed to a civil settlement with the United States for $2.8 million.
The civil settlement announced today resolves allegations that, from 2013 through 2016, Dr. Daitch caused the submission of false claims to Medicare and Tricare by causing the submission of definitive Urine Drug Testing (“UDT”) in circumstances where such testing was not reasonable or medically necessary. Definitive UDT testing was financially lucrative for Dr. Daitch because the testing was performed at Advanced Pain’s own in-house laboratory and was billed for by the practice.
In addition, the civil settlement resolves kickback allegations associated with anesthesia services provided by Anesthesia Partners of SWFL, LLC. Anesthesia Partners was owned by Dr. Daitch and his partner Dr. Frey and provided anesthesia services exclusively for the procedures performed by the Advanced Pain physicians. Anesthesia Partners contracted with Certified Registered Nurse Anesthetists (“CRNAs”) to provide the anesthesia services. These CRNAs were paid a contracted rate. Anesthesia Partners then billed Medicare and Tricare directly for the anesthesia services they provided. This arrangement resulted in improper remuneration to Dr. Daitch as one of the owners Anesthesia Partners. The United States contends that Dr. Daitch’s ownership interest in Anesthesia Partners, and the remuneration he received through this ownership interest, induced him to refer his patients for anesthesia services to Anesthesia Partners.
On July 9, 2018, the Centers for Medicare & Medicaid Services (“CMS”) suspended all Medicare payments to Anesthesia Partners. As part of this settlement, the United States will retain the funds withheld as a result of the suspension.
“With this settlement, we have successfully held both of the principal owners of Advanced Pain accountable for their abuse of the federal programs,” said United States Attorney Chapa Lopez. “The investigation of this healthcare company, which has resulted in three guilty pleas and more than $4.5 million returned to the taxpayers, is a great example of our commitment to enforce our nation’s health care laws.”
In addition to the civil settlement, Dr. Daitch, Advanced Pain, and Park Center for Procedures (“Park Center”—an ambulatory surgical center also owned by Drs. Daitch and Frey, which provides services to patients of Advanced Pain) have entered into a five-year Corporate Integrity Agreement with the Office of Inspector General of the United States Department of Health and Human Services. The Corporate Integrity Agreement, among other obligations, requires Dr. Daitch, Advanced Pain, and Park Center to hire an independent review organization to monitor both claims and financial arrangements. That information, along with other information, will then be reported annually to OIG.
“OIG will continue to aggressively investigate physicians disregarding their Hippocratic Oath in order to enrich themselves through illegal kickback arrangements and the ordering of unnecessary medical services,” said Shimon R. Richmond, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services. “To those who would violate the public trust and stick taxpayers with the bill -- be warned. OIG and our partners will call you to account.”
"This settlement demonstrates the effectiveness of investigations by the Defense Criminal Investigative Service and our law enforcement partners to ensure that medical providers do not unjustly enrich themselves by abusing the Department of Defense TRICARE program. DCIS protects the integrity of DoD programs by rooting out fraud, waste, and abuse that diverts and wastes precious American taxpayer dollars intended for our Warfighters,” said Special Agent in Charge John F. Khin, Southeast Field Office.
The investigation was handled by Assistant U.S. Attorney Kyle S. Cohen, with assistance from DCIS and the Department of Health and Human Services Office of Inspector General.
Today’s resolution illustrates the government’s commitment to combating improper practices that implicate the nation’s federally subsidized health care programs, using all statutory and common law remedies available to address such schemes. Tips from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services, at 800-HHS-TIPS (800-447-8477). The claims resolved by the settlement are allegations only, and there has been no determination of liability.
Former U.S. Senate Employee Sentenced to Prison Term on False Statements ChargeRead the Press Release
WASHINGTON – James A. Wolfe, 58, of Ellicott City, Maryland, the former Director of Security for the U.S. Senate Select Committee on Intelligence (SSCI), was sentenced today to two months in prison for making a false statement to the FBI during the course of an investigation into the unlawful disclosure of classified national security information.
The announcement was made by Assistant Attorney General for National Security John C. Demers, U.S. Attorney Jessie K. Liu for the District of Columbia, and Special Agent in Charge Timothy M. Dunham of the Counterintelligence Division of the FBI’s Washington Field Office.
Wolfe pled guilty on Oct. 15, 2018, in the U.S. District Court for the District of Columbia, to one count of making a false statement. Under the plea agreement, the government moved to dismiss two remaining false statements counts at sentencing. In his proffer, Wolfe admitted to the conduct underlying one of the two dismissed counts.
In addition to the prison time, the Honorable Ketanji Brown Jackson ordered that Wolfe pay a $7,500 fine. She also ordered that he complete four months of supervised release following his incarceration. During that time, he is to perform 20 hours of community service a month.
At the time Wolfe made the false statement to the FBI, he was the Director of Security for the SSCI, a position he held for more than 28 years. As SSCI Director of Security, he was entrusted with receiving, maintaining, and managing classified national security information provided to the SSCI by the Executive Branch of the United States.
According to a statement of offense filed at the time of the plea, the FBI opened an investigation in April 2017 into the unauthorized disclosure of classified national security information that had appeared in a specific article published by a national news organization. In December 2017, during the course of the investigation, Wolfe was interviewed. Wolfe was asked specifically about whether he had been in contact with any reporters and, if so, who those reporters were, and what were the nature and extent of those contacts and the means by which those contacts occurred.
By his guilty plea, he admitted making false statements to the FBI concerning whether he had provided unclassified, but not otherwise publicly-available, information to reporters. Specifically, on Oct. 16, 2017, and again on Oct. 24, 2017, Wolfe provided a particular reporter with non-public information concerning a witness who had been subpoenaed to testify before the SSCI. Wolfe also admitted making false statements to the FBI about his contacts with three additional reporters, including one of the authors of the aforementioned article.
Wolfe was indicted in June 2018. The investigation into this matter was conducted by the FBI’s Washington Field Office. The case was prosecuted by Assistant U.S. Attorneys Jocelyn Ballantine and Tejpal S. Chawla and Special Assistant U.S. Attorney Laura Ingersoll of the District of Columbia, with assistance from the Counterintelligence and Export Control Section, National Security Division of the U.S. Department of Justice.
Former Tax Return Preparer Pleads Guilty to Tax and Bankruptcy FraudRead the Press Release
WASHINGTON - Geoffrey Rotich pleaded guilty to aiding and assisting in the preparation of a false income tax return and making a false bankruptcy declaration, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Stephen R. McAllister of the District of Kansas.
According to documents filed with the court, Rotich owned and operated Inventax, a tax preparation business in Shawnee, Kansas. In March 2013, Rotich willfully aided and assisted in the preparation and filing of an individual’s 2012 individual income tax return that he knew contained false claims for education expenses and other deductions. Rotich also knowingly filed a fraudulent bankruptcy petition, which failed to disclose his interest in Inventax and to completely identify all of his bank accounts.
U.S. District Judge Daniel D. Crabtree scheduled sentencing for March 21, 2019. Rotich faces a maximum sentence of three years in prison for the tax count and a maximum sentence of three years in prison for the bankruptcy fraud count. Rotich also faces a period of supervised release, restitution and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney McAllister commended special agents of IRS-Criminal Investigation and Homeland Security Investigations, who conducted the investigation, and Trial Attorney Timothy M. Russo of the Tax Division and Assistant U.S. Attorney D. Christopher Oakley of the District of Kansas, who prosecuted this case, and the U.S. Trustee’s Office in Wichita, Kansas for their substantial assistance.
Additional information about the Tax Division and its enforcement efforts may be found on the Division’s website.
Former Tax Return Preparer Pleads Guilty to Tax and Bankruptcy FraudRead the Press Release
Geoffrey Rotich pleaded guilty to aiding and assisting in the preparation of a false income tax return and making a false bankruptcy declaration, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Stephen R. McAllister of the District of Kansas.
According to documents filed with the court, Rotich owned and operated Inventax, a tax preparation business in Shawnee, Kansas. In March 2013, Rotich willfully aided and assisted in the preparation and filing of an individual’s 2012 individual income tax return that he knew contained false claims for education expenses and other deductions. Rotich also knowingly filed a fraudulent bankruptcy petition, which failed to disclose his interest in Inventax and to completely identify all of his bank accounts.
U.S. District Judge Daniel D. Crabtree scheduled sentencing for March 21, 2019. Rotich faces a maximum sentence of three years in prison for the tax count and a maximum sentence of three years in prison for the bankruptcy fraud count. Rotich also faces a period of supervised release, restitution and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney McAllister commended special agents of IRS-Criminal Investigation and Homeland Security Investigations, who conducted the investigation, and Trial Attorney Timothy M. Russo of the Tax Division and Assistant U.S. Attorney D. Christopher Oakley of the District of Kansas, who prosecuted this case, and the U.S. Trustee’s Office in Wichita, Kansas for their substantial assistance.
Additional information about the Tax Division and its enforcement efforts may be found on the Division’s website.
Former Tax Lawyer Arrested on Tax Evasion ChargesRead the Press Release
LOS ANGELES – A Long Beach man who once worked as a tax and estate-planning lawyer has been charged by a federal grand jury with two felony counts of tax evasion for setting up shell companies to evade the payment of over $1.4 million he owed to the Internal Revenue Service.
James Roy McDaniel, 65, was arrested on Tuesday and today remains in federal custody without bond. At his arraignment on Tuesday, McDaniel entered a not guilty plea and was ordered to stand trial on February 12.
McDaniel was a licensed California attorney for more than two decades, until he pleaded guilty in late 2004 to one felony count of subscribing to a false income tax return. In 2005, McDaniel was sentenced to three years in federal prison for that crime, and he surrendered his license to practice law in California. In that case, McDaniel’s failure to report income resulted in a tax loss of $677,368 to the federal government, according to court documents. The IRS subsequently assessed McDaniel more than $1.4 million in taxes, interest and penalties for the tax years 1997 through 2001, court papers state.
According to the tax evasion indictment returned by a federal grand jury earlier this month, McDaniel willfully attempted to evade paying his debt to the IRS by creating two shell companies – Davis Bell Consulting LLC and James Roy Consulting LLC – where he directed payments for tax and estate planning work he performed after being released from prison. During a scheme that allegedly ran from May 2008 until December 2012, McDaniel attempted to mislead federal tax authorities and conceal his income by directing other people to sign documents identifying themselves as the sole managing members of the shell companies. As part of the alleged scheme, McDaniel directed them to open bank accounts where he deposited checks for his tax and estate planning work, the indictment states.
McDaniel also allegedly applied for a Taxpayer Identification Number for James Roy Consulting in the name of another person without obtaining that person’s consent.
The indictment also alleges that McDaniel failed to file a federal income tax return for 2012 and failed to pay $45,725 in taxes due for that year.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
If he were to be convicted of the two tax evasion charges alleged in the indictment, McDaniel would face a statutory maximum sentence of 10 years in federal prison.
This case is being investigated by IRS Criminal Investigation.
This case is being prosecuted by Assistant United States Attorney Ruth Pinkel of the Public Corruption and Civil Rights Section.
Former Shaw Insider Sentenced to Federal Prison for Insider TradingRead the Press Release
United States Attorney Brandon J. Fremin announced today that U.S. District Judge John W. deGravelles sentenced KELLY LIU, age 33, of Baton Rouge, Louisiana, to 16 months in federal prison following her convictions for securities fraud (insider trading) and conspiracy to commit securities fraud. The Court also sentenced LIU to pay a fine of $7,500 and to serve 1 year of supervised release following her term of imprisonment.
In May of this year, a jury found LIU and her two co-defendants guilty as charged in connection with an insider trading scheme related to the 2012 acquisition of the Shaw Group (“Shaw”) by Chicago Bridge and Iron Company (“CB&I”). According to evidence presented at trial, in mid-2012, Shaw was considering a potential merger opportunity. At the time, LIU was working in Shaw’s Financial Planning and Analysis Department on Essen Lane. In July 2012, Shaw and CB&I came to an agreement on an offer for CB&I to buy Shaw. This merger between the two companies was publicly announced on July 30, 2012 (“the public announcement”). As a result of the public announcement, Shaw’s stock price rose by around 55 percent.
The evidence at trial established that, prior to the public announcement and through her job at Shaw, LIU obtained inside information that Shaw was going to be acquired by another company. She subsequently passed the inside information to Victory Ho (“Ho”), through another individual, and to her former boyfriend, Salvador J. Russo, III (“Russo”), for their use in trading Shaw stock and options. Documents and testimony presented at trial also showed that, in the months leading up to the public announcement, LIU was assisting a Ho family business with obtaining financing and insurance on a real estate project in Morgan City, Louisiana.
Based on the information provided by LIU, Ho and Russo purchased Shaw stock and options before the public announcement. Through these purchases, Ho reaped almost $300,000, and Russo secured a profit of approximately $4,000 on a $5,000 investment.
On October 24, 2018, co-defendant Victory Ho, age 39, of Morgan City, was sentenced to 32 months in federal prison, ordered to forfeit over $300,000 and to pay a $15,000 fine, following his convictions in the same insider trading scheme.
On October 30, 2018, co-defendant Russo, age 35, of Baton Rouge, was sentenced to 16 months in federal prison following his convictions in the same scheme.
United States Attorney Fremin stated, “This investigation and prosecution of another company insider should serve as a strong deterrent to others in the future. It is crucial that investors in the Middle District of Louisiana and across the country know that federal law enforcement will devote substantial resources to safeguard and protect a level playing field in the financial markets. Once again, I appreciate the team of agents from FBI, Secret Service, and IRS-Criminal Investigation, along with the staff and prosecutors from my office, who devoted countless hours to this investigation and prosecution.”
Passing private information regarding stock transactions in the hopes that it will yield big returns for certain insiders is not savvy investing; it's criminal activity,” stated Thomas J. Holloman, III, IRS - Criminal Investigation Special Agent in Charge. "Today's sentence reinforces our commitment to every American that IRS – Criminal Investigation will work diligently to protect the assurances of market integrity that should be afforded to all investors.
Tara McLeese, Resident Agent in Charge of the Secret Service Baton Rouge office stated “The justice delivered in this case highlights a successful joint investigative effort undertaken by several agencies in the Baton Rouge area. The United States Secret Service will continue our relentless pursuit of those who seek to endanger the financial integrity of the United States for their own benefit and will continue to work in unison with our federal, state and local partners.”
FBI Special Agent-in-Charge Eric J. Rommal stated, “The FBI New Orleans Field Office will continue to work with our federal, state, and local partners to uphold the integrity of the nation’s securities and commodities markets. The selfish, illegal, and unethical behavior of Kelly Liu will not be tolerated. Corporate insiders like Kelly Liu, and her co-conspirators, Ho and Russo, who unjustly enrich themselves using material non-public information, will be held accountable for their actions.”
This matter is being handled by the U.S. Attorney’s Office for the Middle District of Louisiana and the Baton Rouge offices of the FBI, Secret Service, and IRS-Criminal Investigation. It is being prosecuted by Assistant United States Attorneys Chris Dippel and Patricia Jones.
Former Police Officer, Union Official Sentenced in Fraud CaseRead the Press Release
PROVIDENCE – A former union official for the Fraternal Order of Police (FOP), Newport Lodge No. 8, was sentenced in U.S. District Court in Providence today for fraudulently converting more than $31,000 in FOP funds for his own personal use.
Appearing before U.S. District Court Chief Judge William E. Smith on May 24, 2018, former Newport police officer Adam Conheeny, 46 of Portsmouth, admitted that between August 2009 and December 2014, he used an FOP debit card, wrote checks from a union account payable to himself, and withdrew cash from an FOP bank account for his own personal use. In pleading guilty to wire fraud, Conheeny admitted to fraudulently converting approximately $31,413 in FOP funds for his own use.
At sentencing today, U.S. District Court Chief Judge William E. Smith sentenced Conheeny to 3 months incarceration to be followed 2 years supervised release.
Conheeny’s sentence is announced by Michael Mikulka, Special Agent in Charge of the New York Region of the U.S. Department of Labor Office of Inspector General, and Superintendent of the Rhode Island State Police Ann C. Assumpico.
In a related case, Christopher Hayes, 51, of Middletown, a former Newport Police Department Sergeant and a former president of the FOP, Newport Lodge No. 8, pled guilty on May 1, 2017, to wire fraud. He was sentenced on July 21, 2017, to 6 months imprisonment followed by 6 months of home confinement. At the time of his guilty plea he admitted that he converted approximately $71,523 in FOP funds for his personal use.
The case was prosecuted by Assistant U.S. Attorney John P. McAdams.
The matter was investigated by the United States Department of Labor Office of Inspector General, United States Department of Labor Office of Labor Management Standards, and the Rhode Island State Police Financial Crimes Unit.
###
Note: This is an unattended email. Do not reply to this message. If you have questions, please use the contacts in the message.
Former Georgia correctional officer sentenced to federal prison for smuggling drugs into state prisonRead the Press Release
ROME, Ga. – Tiffany Cook, a former Georgia Department of Corrections (GDC) officer, pleaded guilty to being paid by a prison inmate to smuggle methamphetamine and marijuana into Hays State Prison located in Trion, Georgia.
“Correctional officers compromise the safety of our nation’s prisons when they trade their badges for money,” said U.S. Attorney Byung J. “BJay” Pak. “Prisons are supposed to be places where additional criminal activity is impossible, but this notion breaks down when officers participate in the crimes.”
“Cook not only betrayed the institution she was sworn to protect, she also betrayed every hard working corrections officer who upholds their oath every day,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “Removing corrupt staff who violate their sworn duties as government employees and jeopardize the safety of fellow officers and inmates remains one of our main priorities.”
“The GDC does not tolerate actions of individuals who choose to bring discredit to the values of our agency and put their fellow Officers at risk,” said Timothy C. Ward, interim commissioner of the Georgia Department of Corrections. “We appreciate the support of our federal partners in ensuring that justice will be served, and we are proud of those Officers involved who were diligent in stopping the introduction of dangerous contraband into one of our facilities.”
According to U.S. Attorney Pak, the charges, and other information presented in court: On May 17, 2010, Cook began working with the GDC as a correctional officer. Beginning in April 2017, Cook served as a correctional officer at Hays State Prison. Hays State Prison is located in Trion, Georgia in Chattooga County. The facility opened in 1990 and currently holds approximately 1,680 male prisoners.
In early July 2018, the GDC received information from an inmate that Cook was being paid to smuggle illegal drugs into the prison. On July 9, 2018, Cook arrived at Hays State Prison to report for her regularly-scheduled shift. As Cook approached the time clock, correctional officers asked Cook to walk into a conference room. Following the request, Cook stated that she felt ill and wanted to leave the prison. Correctional officers detained and ultimately searched Cook.
Pursuant to their search, correctional officers recovered more than 118 grams of actual methamphetamine (with a purity of 90%), and more than 150 grams marijuana from Cook’s vaginal cavity and bra. After seizing the methamphetamine and marijuana, correctional officers placed Cook under arrest.
Tiffany Cook, 34, of Summerville, Georgia, was sentenced by Senior U.S. District Judge Harold L. Murphy to seven years, eight months in prison to be followed by five years supervised release. On October 11, 2018, Cook was charged in a criminal information with one count of possession, with intent to distribute, a controlled substance.
This case was investigated by the FBI and Georgia Department of Corrections.
Assistant U.S. Attorney Jeffrey W. Davis, Chief of the Public Integrity and Special Matters Section, prosecuted the case.
The U.S. Attorney’s Office in Atlanta recommends parents and children learn about the dangers of drugs at the following web site: www.justthinktwice.gov.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Former Controller of Saint Paul Town and Country Club Sentenced to 42 Months of Prison for Embezzlement SchemeRead the Press Release
JULIE ANN LEE, 53, former controller of the Town & Country Club, was sentenced today to 42 months of federal prison for operating a million dollar embezzlement scheme. LEE, who pleaded guilty on April 4, 2018, was sentenced by Senior Judge Donovan W. Frank in U.S. District Court in St. Paul, Minnesota.
“For more than eight years, Ms. Lee used her position to embezzle more than a million dollars from Town and Country. She took elaborate steps to hide her deception from her employer, her colleagues and the club’s members who entrusted her with the club’s finances, said United States Attorney Erica H. MacDonald. “Today’s sentence highlights the seriousness of financial crimes.”
According to the defendant’s guilty plea and documents filed in court, from 2008 through December 2016, LEE was the controller of the Town & Country Club (“TCC”) in St. Paul, Minnesota. In her role, LEE was responsible for managing TCC’s finances and had authority to sign and issue checks on behalf of TCC as well as signing authority on TCC’s bank accounts, including a line of credit TCC had with Alliance Bank. LEE used her position as controller to devise a scheme to embezzle more than $1 million from TCC over the course of eight years.
As part of her embezzlement scheme, LEE fraudulently issued herself more than 50 checks totaling approximately $163,357 directly from TCC’s bank accounts. LEE also stole approximately $250,000 in cash from TCC, which she deposited into her personal bank account. LEE also made payments on her personal credit cards directly from TCC bank accounts totaling approximately $764,932. LEE spent the funds she embezzled on things unrelated to TCC, including personal travel, home improvements and her mortgage, a 2013 Dodge Charger, a 2015 GMC Sierra K3500 pickup truck, a motorcycle, and a recreational vehicle.
LEE admitted to attempting to conceal her embezzlement scheme and cover the shortage of money in TCC’s bank accounts by taking advances on TCC’s line of credit at Alliance Bank. As a result of LEE’s embezzlement, TCC was left without sufficient funds to make its quarterly payroll tax payments to the IRS. In order to conceal the shortage of funds, LEE filed false quarterly payroll tax returns with the IRS understating TCC’s payroll tax liability. At times, LEE also filed TCC’s quarterly payroll tax returns late and made TCC’s quarterly tax payments late, which resulted in TCC paying more than $300,000 in interest and penalties to the IRS.
United States Attorney Erica H. MacDonald thanked the Criminal Investigation Division of the Internal Revenue Service, the United States Secret Service, and the Saint Paul Police Department for their work on the investigation, and Assistant United States Attorney Joseph H. Thompson for prosecuting the case.
Defendant Information:
JULIE ANN LEE, 53
Farmington, MN
Convicted:
- Wire fraud, 1 count
- Filing a false tax return, 1 count
Sentenced:
- 42 months imprisonment
- 3 years supervised release
- $1,178,189 in restitution
- $200 special assessment
###
Additional news available on our website.
Follow us on Twitter and Facebook.
United States Attorney’s Office, District of Minnesota: (612) 664-5600
Former Boston Police Officer Sentenced in Connection with Straw Purchases of FirearmsRead the Press Release
BOSTON – A former Boston Police Officer was sentenced today in federal court in Boston with illegally purchasing two firearms on behalf of acquaintances.
Adarbaad Karani, 38, of West Roxbury, was sentenced by U.S. Senior District Court Judge Rya W. Zobel to three months in prison and one year of supervised release. In September 2018, Karani was convicted following a five-day jury trial of two counts of making a false statement during the purchase of firearms and two counts of making a false statement in a record.
On two different occasions, in November 2014 and September 2015, Karani acted as the “straw purchaser” of two firearms, a Glock, model 27, .40 caliber pistol and a Glock, model 30S, .45 caliber pistol, which he purchased for two acquaintances. Karani purchased the firearms, which cannot be acquired by civilians, using his police identification and falsely certified that the firearms were for his official police use. During one purchase, Karani also indicated that the firearm was not for resale. One of the firearms that Karani purchased was subsequently stolen from the person on whose behalf Karani bought the gun. The firearm was recovered by law enforcement during the arrest of Desmond Crawford, an alleged member of the Columbia Point Dawgs.
Straw purchases interfere with firearm regulation and recordkeeping, and federal law prohibits making false statements to a firearms dealer in connection with the sale of a firearm.
United States Attorney Andrew E. Lelling; Kelly Brady, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms & Explosives, Boston Field Division; and Boston Police Commissioner William Gross made the announcement today. Assistant U.S. Attorney Eugenia M. Carris of Lelling’s Public Corruption & Special Prosecutions Unit prosecuted the case.
Former Bank President Sentenced to Federal Prison for Bank Fraud and Tax EvasionRead the Press Release
Baltimore, Maryland – U.S. District Judge Richard D. Bennett sentenced David Harris Lavine, age 58, of Rockville, Maryland, today to three years in federal prison, followed by two years of supervised release, for bank fraud in connection with a scheme to defraud the financial institution, where he served as acting president and later president of a bank affiliate, and for income tax evasion. Lavine was also ordered to pay $892,541.75 in restitution to the financial institution and $365,228.80 in restitution to the Internal Revenue Service and to forfeit $503,378.87.
The sentence was announced by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge Gordon B. Johnson of the Federal Bureau of Investigation, Baltimore Field Office; Special Agent in Charge Kelly Jackson of the Internal Revenue Service-Criminal Investigation; Assistant Inspector General Gerald Maye of the Office of Inspector General for the Board of Governors of the Federal Reserve System and the Consumer Finance Protection Bureau; and Special Agent in Charge Michael McGill of the Social Security Administration, Office of Inspector General.
From March 2010 until January 2011, David Harris Lavine was the acting president of CFG Community Bank. According to his plea agreement, Lavine admitted that, while acting President, he diverted $100,000 of bank funds to his own benefit. Lavine directed bank employees to wire funds, which Lavine mischaracterized as payments to a mortgage broker on bank loan refinances, to a company that belonged to a friend of Lavine’s. Lavine lied to the friend about the source of the funds and had the friend pay the $100,000 over to Lavine.
In January 2011, shortly after Lavine resigned as the acting president of CFG Comminuty Bank to become president of Capital Financial Ventures (CFV), an affiliate of the bank, Lavine devised a scheme to defraud CFG Community Bank, through the re-finance of two bank-owned commercial mortgage loans and the diversion of the Bank’s loan payoffs to his personal benefit and the benefit of Charles Tobias, his co-defendant in this case.
Lavine admitted that in order to execute the scheme to divert loan payoffs, he used his position at CFV to pose as the CEO/President of CFG Community Bank. For example, Lavine invited the borrowers of two loans with balances totaling over $7.5 million, to refinance those loans with other financial institutions for lower mortgages and pay off CFG Community Bank. At Lavine's direction, the settlement companies sent the mortgage loan payoffs not to CFG Community Bank but to an escrow account managed by Tobias so that Lavine could divert over $775,000. The records created by Lavine showed one payoff amount to the borrower, but the records Lavine sent to the bank understated the payoff amounts and concealed the fact that Lavine had diverted over $775,000 from the Bank’s loan payoffs. Lavine divided the fraud proceeds with Tobias.
Lavine also diverted a total of $91,126.56 in insurance premium refunds on one of the commercial loans purchased by the bank to his personal account instead of paying the funds over to the borrower. Lavine spent over $14,000 of the refunded premium; over $76,000 remained in the custody of the bank. The bank repaid the full $91,125.56 to the borrower.
Lavine and Tobias owned Capital T Partners Brookfield, LLC, a Maryland limited liability corporation. In the fall of 2011, Lavine and Tobias attempted to realize a profit from a group of non-performing mortgages their company had purchased by "donating" some of the mortgages to a charity as an in-kind donation and taking a charitable deduction on their income tax returns. Lavine admitted that he and Tobias created a false IRS Form 8283 and false appraisal which they had Ari Gerzowski, a real estate agent and not a licensed appraiser, sign. As a result of the fraudulent appraisal, Tobias and Lavine received a valuable tax deduction for Capital T Partners Brookfield which would pass through to their personal income tax returns. Lavine and Tobias divided the tax benefits from the $1,032,722 purported charitable deduction they were claiming.
Lavine also admitted that he failed to report income of more than $176,000 in 2010, and failed to report income of $480,289.44, from the loan fraud proceeds and two stolen insurance refunds in 2011. Lavine underpaid his taxes for 2010, 2011, and 2012 by $365,228.80 based on his failure to report fraud proceeds as income and his fraudulent charitable contribution deduction which sheltered reported income.
Charles L. Tobias, age 56, of Potomac, Maryland previously pleaded guilty to willfully subscribing to a false tax return, and was sentenced to two years of probation with 8 months of home confinement with electronic monitoring and ordered to pay restitution of $154,438 to the Internal Revenue Service. Ari Gerzowski, age 47, of Baltimore, pleaded guilty to aiding and abetting the willful submission of a materially false document to the Internal Revenue Service and was sentenced to probation.
United States Attorney Robert K. Hur commended the IRS, the FBI, the Office of Inspector General for the Board of Governors of the Federal Reserve System and the Consumer Financial Protection Bureau, and the Office of Inspector General for the Social Security Administration for their work in the investigation. Mr. Hur thanked Assistant United States Attorneys Joyce K. McDonald and Peter J. Martinez, who prosecuted the case.
# # #
Florida man sentenced to 8 years in prison for trafficking cocaine in Calcasieu ParishRead the Press Release
LAKE CHARLES, La. – United States Attorney David C. Joseph announced that a Florida man was sentenced Monday to 96 months in prison for trafficking nearly 10 kilograms of cocaine.
Kavin Grandison, 46, of Pensacola, Florida, was sentenced by U.S. District Judge Donald E. Walter on one count of possession with intent to distribute a controlled substance. He was also sentenced to four years of supervised release. According to the October 3, 2018 guilty plea, a law enforcement officer conducted a traffic stop on Grandison’s vehicle on February 22, 2018 in Calcasieu Parish. After a search of the vehicle, the officer discovered sealed plastic bags in the gas tank, which contained powder cocaine. The substance was tested, weighed and found to be 4.972 kilograms of cocaine. During an earlier arrest, officers had stopped Grandison’s vehicle on November 8, 2017 in Jackson County, Mississippi, and conducted a search of his vehicle. They found six sealed packages in a detergent box that later tested to be 4.384 kilograms of cocaine. Grandison was found with a total of 9.356 kilograms of cocaine confiscated from both vehicle stops.
Homeland Security Investigations and the Calcasieu Anti-Drug Team conducted the investigation. Assistant U.S. Attorney Dominic Rossetti prosecuted the case.
Florence Resident Sentenced to Federal Prison for Manufacturing and Passing Counterfeit MoneyRead the Press Release
Columbia, South Carolina ---- United States Attorney Sherri A. Lydon announced today that Joshua Ryan Nance, 28, of Florence, South Carolina, was sentenced to over three years in federal prison for his role in a conspiracy to manufacture and pass counterfeit money.
Evidence presented to the court showed that Nance was involved in a conspiracy to manufacture and pass counterfeit $100 and $50 bills in multiple states, including South Carolina and North Carolina. This conspiracy, which began in 2015, included at least nine co-conspirators who were responsible for making and passing over $100,000 in counterfeit money.
Nance and other conspirators manufactured counterfeit money at several residences in Florence, South Carolina. They produced counterfeit $100 bills on genuine currency paper, then visited various local businesses, where they would purchase small items or services with the counterfeit $100 bills in order to obtain genuine currency as change.
United States District Judge R. Bryan Harwell sentenced Nance to 46 months in federal prison, to be followed by three years of court-ordered supervision. There is no parole in the federal system.
The case was investigated by the United States Secret Service with the assistance of the Florence County Sheriff’s Office and the Florence Police Department. Assistant United States Attorney A. Bradley Parham of the Florence office prosecuted the case.
#####
Federal Jury Convicts Two Defendants of Narcotics Conspiracy Tied to the El Chapo Mexican Drug CartelRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051
BUFFALO, N.Y.--U.S. Attorney James P. Kennedy, Jr. announced today that following an eight week trial, a federal jury has convicted Herman E. Aguirre, a/k/a 007, a/k/a Lucky, a/k/a Primo, a/k/a Freddy, of Brea, California, and Troy R. Gillon, of Lockport, NY, of narcotics conspiracy. Defendant Aguirre was also convicted of operating a continuing criminal enterprise and money laundering conspiracy. The charges carry a maximum penalty of life in prison.
Assistant U.S. Attorneys Meghan A. Tokash and Michael P. Felicetta, who handled the prosecution of the case, stated that Aguirre was the leader, and Gillon a member, of a transnational drug trafficking organization that utilized contacts and a source of supply whose territory included Mexico, Arizona, California, and elsewhere. The source of supply was the Sinaloa Cartel, led by Joaquín “El Chapo” Guzmán and Ismael “El Mayo” Zambada.
The local organization trafficked thousands of kilograms of illegal narcotics, including heroin, fentanyl, and cocaine throughout the United States, including Lockport, Niagara Falls, and Buffalo, via the mail, individual vehicles outfitted with “trap” compartments, and on pallets loaded on tractor trailers. Members of the organization created fictitious “front” companies to launder drug proceeds including Triton Foods, Inc., Kamora Investment Enterprises, Inc. and Fresh Choice Produce, all of which were incorporated in the State of California. Another fictitious company, Corral Seafoods, LLC, registered in the State of New York, was allegedly located in Cheektowaga, NY, but proved to be completely fake.
Using these companies, the defendants disguised kilogram quantities of heroin, fentanyl, and cocaine on pallets described on inventory and other documents as containing “Sea Cucumbers.” Evidence presented by the Government at trial showed that sea cucumbers are commonly found in Southeast Asia and Europe but rarely, if ever, in Western New York State. The pallets bearing the illegal narcotics were secreted in containers sealed with foam or spray insulation to avoid detection by law enforcement.
Members of the organization also utilized numerous bank accounts at local Bank of America branches to deposit illegal drug proceeds. Local members of the drug trafficking organization deposited over $19,000,000 of illegal drug proceeds into these fake seafood accounts, while California conspirators created false invoices to make it look like Western New Yorkers were buying sea cucumbers at astounding rates and quantities. The Western New York Asset Protection Manager of Wegman’s Food Markets, Inc. testified at the trial that none of its 13 Western New York stores have ever carried sea cucumbers because there is no demand for the product in Buffalo and the surrounding areas.
During the course of the investigation, law enforcement officers seized over $5,000,000 worth of illegal narcotics, including:
• 52.5 kilograms of cocaine;
• 17.5 kilograms of heroin; and
• 8.5 kilograms of fentanyl
Using standard dosage amounts, the seized drugs potentially represented over 1,500,000 “hits” of cocaine, and 2,700,000 “hits” of heroin and considering that two milligrams of fentanyl can be a lethal dose, enough fentanyl potentially to kill over four million people. Further evidence presented by the Government at trial revealed that after a December 2014 meeting in Buffalo, defendant Aguirre shipped 10 kilograms of fentanyl to Buffalo and defendant Gillon took possession of the 10 kilograms. Gillon sold two kilograms of the fentanyl before residents of the Lockport area started overdosing on the drug shortly after New Year’s Day, 2015. A DEA representative testified that Gillon told police that he returned the remaining eight kilograms to a co-conspirator in early March 2015 because, “People are dying off this (expletive).” The co-conspirator moved the remaining fentanyl, along with two kilograms of cocaine, and 22 kilograms of heroin, to a house on Folger Street in the City of Buffalo. On March 23, 2015, Buffalo Police seized 32 kilograms of drugs from the Folger Street location—including Gillon’s eight kilograms of fentanyl.
The investigation further determined that between June 2013 and September 2015, members of the organization additionally distributed over 5,000 pounds of cocaine, heroin, fentanyl and marijuana in the Western New York area. Approximately $20,000,000 was sent from Western New York banks to California in a two year period of time.
“This transnational drug organization and these defendants were responsible for introducing the scourge of lethal fentanyl into our community, resulting in the loss of lives,” stated U.S. Attorney Kennedy. “However, as a result of this verdict and previous convictions of multiple co-defendants, the organization and the pipeline have been effectively shut down.”
“Throughout this trial, it clearly demonstrates to the public that traffickers are reaping millions of dollars off overdoses, addiction and death,” stated DEA Special Agent in Charge Ray Donovan. “DEA’s seizures and enforcement efforts in Buffalo denied the Sinaloa Cartel revenue of $2.5 million but more importantly, put 17 members in jail and took nearly three million doses of heroin, fentanyl and cocaine off the streets. I commend our law enforcement partners and the prosecutors at the U.S. Attorney’s Office Western District of New York for their diligent efforts in this investigation.”
“IRS Criminal Investigation uses financial investigative expertise to pursue those individuals who engage in illegal activities as seen in the significant drug organization on trial in this case,” said James D. Robnett, IRS Special Agent-in-Charge of the New York Field Office. “Money laundering constitutes a serious threat to our communities and to the integrity of our financial system; today’s verdict is an example of how merging the unique skills of each agency makes a formidable team as we prosecute the offenders.”
Aguirre and Gillon were indicted along with 15 others including:
• Jose Ruben Gil, a/k/a Unc, a/k/a Ruben Gil Campos, a/k/a Mayor of Mexico, was convicted and is awaiting sentencing;
• Sonia Hernandez, was convicted and is awaiting sentencing;
• Margaret Banuelos, a/k/a Lisa, was convicted and is awaiting sentencing;
• Darryl J. Williams, a/k/a D, was convicted and is awaiting sentencing;
• Trent Adair Hamilton, was convicted and is awaiting sentencing;
• Michael Paul Mitchell, was convicted and is awaiting sentencing;
• Demetrius Yarborough, a/k/a Tu, was convicted and is awaiting sentencing;
• Rashawn Crule, a/k/a Black, a/k/a Shawn, was convicted and is awaiting sentencing;
• Maulana Lucas, a/k/a Big Daddy, a/k/a Shabazz, was convicted and is awaiting sentencing;
• Shirley Grigsby, was convicted and is awaiting sentencing;
• Ralik Hamilton; was convicted and is awaiting sentencing;
• Dion Cheatham, was convicted and is awaiting sentencing; and
• Joseph Thompson, a/k/a Jo-Jo, a/k/a Skools, a/k/a Skoolboy, convicted and sentenced.
Charges are pending against defendants Martha Aguirre and Juan Alfaro. The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
The trial verdict is the result of an investigation by the Drug Enforcement Administration, under the direction of Special Agent-in-Charge Ray Donovan, New York Field Division; Homeland Security Investigations, under the direction of Special-Agent-in Charge Kevin Kelly; the Internal Revenue Service, Criminal Investigation Division, under the direction of James D. Robnett; the Niagara County Drug Task Force, under the direction of Sheriff James Voutour; the Buffalo Police Department, under the direction of Commissioner Byron Lockwood; the Lockport Police Department, under the direction of Acting Chief Steven Preisch; the Montebello, California Police Department, the Nebraska State Patrol, and the DEA, Los Angeles.
Defendant Aguirre is scheduled to be sentenced on June 12, 2019, Gillon on June 14, 2019, both before U.S. District Judge Lawrence J. Vilardo, who presided over the trial of the case.
# # # #
Federal Grand Jury Indicts Businessman on Tax Evasion ChargesRead the Press Release
CHICAGO — A federal grand jury in Chicago has indicted a businessman on tax evasion charges for allegedly scheming to evade personal income taxes for three years.
As the owner of the security firm World Security Bureau, ABRAHAM KISWANI, also known as “Ibriham Kiswani,” willfully failed to pay the full amount of taxes on his personal income for the calendar years 2010, 2012, and 2013, according to an indictment returned in U.S. District Court in Chicago. Kiswani concealed some of his income for those years by arranging for WSB to pay certain personal items, including those held or purchased in the name of family members, and disguising them as business expenses. The expenditures included mortgage payments, homeowner’s association dues, property taxes, sewer and water fees on a personal residence, slip fees and insurance for a boat, slip fees for jet skis, and gold coins, the indictment states. Kiswani covered up some of his 2013 income by arranging for WSB to pay some of his wedding expenses and then entering those payments in WSB’s records as business expenses, the indictment states.
The indictment charges Kiswani, 49, of Burbank, with three counts of tax evasion and one count of willfully filing a false corporate tax return. Kiswani pleaded not guilty at his arraignment Tuesday before U.S. District Judge Manish S. Shah in Chicago.
The indictment was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Gabriel L. Grchan, Special Agent-in-Charge of the Internal Revenue Service Criminal Investigation Division in Chicago; and Jeffrey S. Sallet, Special Agent-in-Charge of the Chicago office of the Federal Bureau of Investigation. Substantial assistance was provided by the U.S. Department of Housing and Urban Development, and the Chicago Housing Authority Office of the Inspector General. The government is represented by Assistant U.S. Attorney Sheri H. Mecklenburg.
The public is reminded that an indictment is not evidence of guilt. The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. Each tax evasion count carries a maximum sentence of five years in prison, while filing a false return is punishable by up to three years. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.
Family Members Sentenced for Roles in Arson and Insurance Fraud SchemeRead the Press Release
BLUEFIELD, W.Va. – Georgetta Lester Kenny and Greg Lester, two members of a Southern West Virginia family, were sentenced to prison by Senior United States District Judge David A. Faber, announced United States Attorney Mike Stuart. After a five day trial earlier this year, a federal jury found them guilty of various charges related to an arson and insurance fraud scheme. Georgetta Lester Kenney, formerly known as Georgetta Lester, age 42, was sentenced to 36 months in prison and was ordered to pay $578,147 in restitution and forfeit $184,623. Greg Lester, age 41, was sentenced to 60 months in prison and was also ordered to pay restitution in the amount of $578,147 and forfeit $11,965. Agents with the West Virginia Insurance Commission, the United States Postal Inspection Service, and the West Virginia State Police conducted the investigation.
“Arson and insurance fraud are serious crimes that impact all of us, particularly through increased insurance premiums,” said United States Attorney Mike Stuart. “The ordering of restitution and forfeiture in cases like this one is every bit as important as the prison sentences imposed. Criminals should not be able to keep profits obtained through their fraudulent schemes.”
Between April of 2012 and January of 2016, the defendants, along with Windel Lester, James “Punkin” Lester, and others, participated in various ways in three separate but inter-related schemes involving arson, mail fraud, wire fraud, and money laundering. Their overall purpose was to enrich themselves by fraudulently obtaining insurance proceeds on houses they intentionally burned. The houses were insured for amounts greatly exceeding their value and the value of any contents. The houses were located at Matoaka in Mercer County, Huntington in Cabell County, and Ikes Fork in Wyoming County.
Windel Lester was found guilty of 17 felony charges and faces 340 years imprisonment. James “Punkin” Lester was found guilty of 23 felony charges and faces 475 years imprisonment. They are scheduled to be sentenced on January 20, 2019.
Others involved included Dudley Bledsoe, Ricky Gleason, and James Browning, all of whom pled guilty and have been sentenced.
Assistant United States Attorneys Philip H. Wright and R. Gregory McVey handled the prosecution.
Follow us on Twitter: SDWVNews
###
Falmouth Man Sentenced to 360 Months for Conspiring to Distribute MethamphetamineRead the Press Release
COVINGTON, Ky. – Gregory Sydnor, 30, of Falmouth, Kentucky, was sentenced today to 360 months in federal prison, by United States District Judge David L. Bunning, for conspiring to distribute methamphetamine. Sydnor was also sentenced to 10 years of supervised release, to be served after completion of his prison term.
Sydnor was convicted of leading a conspiracy that was responsible for distributing more than 1.5 kilograms of crystal methamphetamine, in 2017. Crystal methamphetamine is an extremely pure form of methamphetamine commonly brought to this area from Mexico and communities along the southwest border of the United States. Court documents established that Sydnor regularly distributed methamphetamine to other traffickers and sold methamphetamine to minors. Sydnor, and other members of the conspiracy, also possessed firearms while selling the drugs. Agents seized ten firearms and a large amount of ammunition during the course of the investigation. Sydnor had five prior felony convictions.
Sydnor was indicted in November 2017 along with other members of his conspiracy. All entered guilty pleas. William Todd Ramsey was sentenced to 120 months in federal prison and Sterling T. Cole was sentenced to 157 months in prison, in November 2018. Nathaniel Hughes was sentenced to 37 months in prison in September 2018. Under federal law, each Defendant must serve at least 85 percent of their prison sentence.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Timothy J. Plancon, Special Agent in Charge, Drug Enforcement Administration; Richard Sanders, Commissioner of the Kentucky State Police; and Charles Peoples, Pendleton County Sheriff, jointly made the announcement. The investigation was conducted by the DEA, the Kentucky State Police, and the Pendleton County Sheriff’s Department. The United States was represented by Assistant United States Attorney Tony Bracke.
FBI Arrests Former Washington Resident who Fraudulently Promoted IPO Stock SchemeRead the Press Release
A 27-year-old man was arrested in Los Angeles today on a criminal complaint charging him with wire fraud, announced U.S. Attorney Annette L. Hayes. KEENAN A. GRACEY, formerly of Newcastle, Washington, defrauded Seattle-area investors and others out of millions of dollars by pretending to sell them stock that GRACEY did not own and had no right to sell. GRACEY will make his initial appearance in U.S. District Court in Los Angeles.
According to the criminal complaint, between 2016 and 2018, GRACEY posed as a British billionaire with degrees from the London School of Economics and Oxford University. He drove expensive cars such as Bentleys and Ferraris and claimed to own expensive homes in Clyde Hill, Mercer Island, and Newcastle, Washington, as well as in Beverly Hills and San Diego, California. GRACEY also used falsified bank statements to make it appear he had hundreds of millions of dollars of cash on hand. The investigation revealed that GRACEY is Canadian, not British, and rented expensive homes and cars to make it appear he was wealthy.
GRACEY told potential investors he had special access to millions of shares of “pre IPO” stock that would produce returns of as much as 60 times the initial investment. Some investors gave GRACEY as much as $745,000, believing that they were purchasing stock. In fact, GRACEY did not own any of the stock he was pretending to sell, and simply stole the victims’ money. According to the complaint, investigators have identified more than 25 investors who transferred over $3.4 million to Gracey through bank wires.
The Securities and Exchange Commission filed a civil suit against GRACEY in May 2018 and obtained a temporary restraining order barring him from selling securities. In September 2018, the order was made permanent and GRACEY was ordered to disgorge $4.4 million in cash and wire transfers that he had fraudulently obtained from investors.
The charges contained in the complaint 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.
Wire fraud is punishable by up to 20 years in prison.
The case is being investigated by the FBI. The case is being prosecuted by Assistant United States Attorney Seth Wilkinson.
El Dorado Man Sentenced to 24 Months in Federal Prison for Bank FraudRead the Press Release
El Dorado, Arkansas – Duane (DAK) Kees, United States Attorney for the Western District of Arkansas, announced that Robert Craig “Bob” Smith, age 55, of El Dorado, Arkansas, was sentenced today to 24 months in federal prison followed by five years of supervised release and ordered to pay $850,399.79 in restitution on two counts of Bank Fraud. The Honorable Susan O. Hickey presided over the sentencing hearing in the United States District Court in El Dorado.
According to court records, with respect to the first count, Smith was the owner and operator of Working Chemical Solutions, Inc. (WCS), a Delaware corporation located in El Dorado, Arkansas. Working Chemical Solutions, Inc. manufactured chemical products used in three areas of market concentration Consumer Packaged Specialty Products, Industrial Specialty Products and Scientific Specialty Products. One of its products was known as "C'mere Deer" also known as "Wild Game Attractant." Smith obtained two loans and extensions to those loans for his company, WCS, through Timberland Bank in El Dorado, Arkansas. Timberland Bank secured these loans with a security interest in all stock and other instruments, general intangibles and contract rights, including, “C’mere Deer. Smith subsequently sold the “C’mere Deer” formula, confidential information and trademarks to Environmental Science Technologies, LLC for $500,000 in December 2006. Smith paid Timberland Bank $149,035.21 out of the $500,000.00 and kept $350,964.79 for the use of WCS or his personal use.
With respect to the second count, Smith opened business checking accounts in the names of ATS Scientific Group of Louisiana, LLC and Wells Safety and Technical Products of Louisiana, LLC at First Guaranty Bank in Dubach, Louisiana. He also opened business checking accounts in the names of Gilbo, LLC and RCS Investment Trust at First Financial Bank in El Dorado, Arkansas. In March of 2016, during an audit by First Financial Bank’s Internal Audit Department, it appeared that Smith was kiting checks between his Gilbo, LLC and RCS Investment Trust accounts at First Financial Bank and checks drawn on the ATS Scientific Group of Louisiana, LLC and Wells Safety and Technical Products of Louisiana, LLC accounts at First Guaranty Bank. On March 7, 2016, First Financial Bank placed holds on all unverified deposits. As a result of the holds, the checks presented for payment from First Guaranty Bank to First Financial Bank were returned and the checks deposited to First Financial Bank were returned from First Guaranty Bank. Between March 9, 2016 and March 10 2016, checks totaling $499,435 were charged back to ATS Scientific Group of Louisiana, LLC and Wells Safety and Technical Products of Louisiana, LLC accounts at First Guaranty Bank.
Smith was named in a six count indictment and plead guilty to counts three and six in September 2018.
This case was investigated by Federal Bureau of Investigation. Assistant United States Attorney Mark Webb prosecuted the case for the United States.
Deported Alien with Felony Drug Conviction Charged with Illegally Re-entering United StatesRead the Press Release
PITTSBURGH, PA - An illegal alien found in Pittsburgh, Pennsylvania, has been indicted by a federal grand jury in Pittsburgh on a charge of illegal re-entry after deportation, United States Attorney Scott W. Brady announced today.
The one-count Indictment, returned on Dec. 18, named Vicente Perez-Vargas, 40, of Mexico, as the sole defendant.
According to the Indictment presented to the court, Perez-Vargas, an illegal alien who had been previously deported from the United States on October 19, 1999, after having been convicted of an aggravated felony for illicit trafficking in a controlled substance, was found to be present in Pittsburgh, Pennsylvania on November 21, 2018, without first receiving permission to reenter the United States.
The law provides for a maximum total sentence of 20 years in prison, a fine of $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Nicole Vasquez Schmitt is prosecuting this case on behalf of the government.
U.S. Immigration and Customs Enforcement/Homeland Security Investigations, conducted the investigation leading to the Indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Defendants in Louisville Area Chiropractic Scheme Sentenced to Federal PrisonRead the Press Release
LOUISVILLE, Ky. – U.S. District Judge Rebecca G. Jennings has sentenced defendants of a health care fraud scheme that billed insurance companies for services never performed to years in federal prison, announced United States Attorney Russell M. Coleman.
“This sentence sends a message that theft in the Western District of Kentucky – health care related or otherwise – results in real time in federal prison,” stated U.S. Attorney Russell Coleman
On Wednesday, the Court sentenced Ledinson Chavez to 74 months in prison for health care fraud, money laundering, and aggravated identity theft. The sentence is followed by 2 years supervised release, and $1,016,393.23 in restitution. There is no parole in the federal system.
Sergio Betancourt was sentenced on Wednesday to 37 months imprisonment for health care fraud, money laundering and crimes committed while on pre-trial release. The sentence will be followed by 2 years supervised release, and $1,153,770.34 in restitution.
According to the evidence before the Court, beginning no later than on or about June 12, 2012, and continuing through on or about November 1, 2014, Claudia Lopez, Ledinson Chavez, Oskel Lezcano, Ariel Borrego-Hernandez, Sergio Betancourt and Yuriesky Diaz Rodriguez recruited unsuspecting chiropractors for employment in Louisville area chiropractic clinics in order to obtain and use the chiropractors’ names and National Provider Identifiers (NPI) to fraudulently bill insurance companies. Each chiropractor provided his/her NPI number to Lopez and Lezcano in order to credential the clinics with various insurance companies.
Thereafter, the group of defendants recruited employees from Jeffboat and other local employers to seek chiropractic services from the clinics. However, unbeknownst to the chiropractors, the clinics billed approximately $5,000,000 for methocarbamol injections (a muscle relaxant), using the patients’ names, dates of birth, insurance/policy numbers, addresses, and patient IDs/Social Security Numbers for injections. Most of the patients from Jeffboat were paid to go to the clinics by the defendants and were told the injections were being billed, according to testimony during trial.
Borrego-Hernandez, Lopez, Betancourt, Chavez and allegedly Lezcano operated and controlled multiple chiropractic clinics in the Louisville area including: Xpress Diagnostics Center, Inc.; Prudential Chiropractic Medical Center, PLLC; Klondike Chiropractic Medical Center, LLC; Be Well Chiropractic Center, Corp.; and Chiropractic and Medical Center, LLC, even though the clinics were placed in various chiropractors’ names.
According to additional court documents on or about March 14, 2017, and March 17, 2017, while on pre-trial release, Borrego and Lopez conspired to traffic in marijuana – which caused about 109 pounds of marijuana to be transported from Colorado to Kentucky.
Lopez was sentenced in September to 61 months imprisonment, followed by 3 years of supervised release and ordered to pay $232,617.96 in restitution, as well as forfeit an Audi Q-7 and $53,775 in proceeds.
Ariel Borrego-Hernandez was sentenced in October to 54 months in prison, followed by 3 years supervised release and ordered Borrego-Hernandez to pay $89,161.81 in restitution, and over $53,000 in forfeited cash.
Yuriesky Diaz Rodriguez was sentenced in December to 18 months of probation and ordered to pay $104,624.70 in restitution.
Assistant United States Attorneys Joseph Ansari, Lettricea Jefferson-Webb and Christopher Tieke prosecuted the case and were assisted by Bob Masterson as health care fraud investigator and Mary Kennedy as paralegal. The case was investigated by the Federal Bureau of Investigation, the United States Postal Inspection Service, the Internal Revenue Service Criminal Investigation, the Louisville Metro Police Department, and the National Insurance Crime Bureau.
####
Defendant Charged in White Plains Federal Court with Felon in Possession of A FirearmRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today the filing of a complaint charging DARRELL JONES with possessing a firearm subsequent to having been convicted of a felony. JONES was taken into federal custody today, presented before United States Magistrate Judge Lisa M. Smith, and ordered detained.
As alleged in the Complaint unsealed today in White Plains federal court[1]:
Officers with the U.S. Drug Enforcement Administration (“DEA”) and Mount Vernon Police Department (“MVPD”), executed a search warrant of an apartment believed to be JONES’s on November 26, 2018, where they found, among other things, mail addressed to JONES, a 9 millimeter CANIK TP9SF handgun with the slide separated from the receiver, and approximately 300 grams of a white substance believed to be heroin. An agent with the Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF”) has confirmed that the CANIK handgun was manufactured outside New York. JONES has nine prior state felony convictions, including seven felony convictions for possession, attempted possession, or sale of controlled substances.
* * *
Based on the charges in the current complaint, JONES faces a maximum of 10 years in prison, with the possibility of a mandatory minimum of 15 years in prison.
The statutory maximum sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendant would be determined by the judge.
Mr. Berman praised the outstanding investigative work of the DEA Westchester Residential Office, the Mount Vernon Police Department, and the ATF.
This case is being handled by the Office’s White Plains Division. Assistant United States Attorney Samuel L. Raymond is in charge of the prosecution.
The charge contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.
Daycare Owner Sentenced for Stealing Government FundsRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y.-U.S. Attorney James P. Kennedy, Jr. announced today that Tariq Butt, 42, of Buffalo, NY, who was convicted of theft of government funds, was sentenced to serve 12 months in prison by U.S. District Judge Lawrence J. Vilardo. The defendant was also ordered to pay restitution totaling $305,000 to the Department of Health and Human Services.
Assistant U.S. Attorney Maura K. O’Donnell, who handled the case, stated that in February 2015, the defendant and his wife, Halima Mohammed, opened Twinkle Stars Day Care Center, and in July 2015, the couple opened Candyland Daycare, both located in the City of Buffalo.Between January 2016 and September 2016, the defendant submitted hundreds of false and fraudulent claims to Erie County seeking reimbursement for daycare services supposedly provided by Twinkle Stars and Candyland to children eligible for Child Care and Development Block Grant funds from the U.S. Department of Health and Human Services. The defendant knew that the children listed on the claims did not actually attend Twinkle Stars on the dates and times claimed, making the daycare ineligible for reimbursement. In total, between January 2016 and September 2016, Erie County paid Twinkle Stars and Candyland approximately $305,000 for daycare services, which were never rendered.
Halima Mohamed was previously convicted and sentenced to five months in prison and three years supervised release, to include five months home detention.
Today’s plea is the result of an investigation by the U.S. Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent-in-Charge Scott Lampert, and the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Gary Loeffert.
# # # #
Criminal Charges Filed in Los Angeles and Alaska in Conjunction with Seizures of 15 Websites Offering DDoS-For-Hire ServicesRead the Press Release
The Justice Department announced today the seizure of 15 internet domains associated with DDoS-for-hire services, as well as criminal charges against three defendants who facilitated the computer attack platforms.
The sites, which offered what are often called “booter” or “stresser” services, allowed paying users to launch powerful distributed denial-of-service, or DDoS, attacks that flood targeted computers with information and prevent them from being able to access the internet. Booter services such as those named in this action allegedly cause attacks on a wide array of victims in the United States and abroad, including financial institutions, universities, internet service providers, government systems, and various gaming platforms.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Nicola T. Hanna of the Central District of California, U.S. Attorney Bryan Schroder of the District of Alaska, and Assistant Director Matthew Gorham of the FBI Cyber Division made the announcement. The action against the DDoS services comes the week before the Christmas holiday, a period historically plagued by prolific DDoS attacks in the gaming world.
On Dec. 19, pursuant to seizure warrants issued by the U.S. District Court for the Central District of California, the FBI seized the domains of 15 booter services, which represent some of the world’s leading DDoS-for-hire services. Among these sites were critical-boot.com, ragebooter.com, downthem.org and quantumstress.net.
According to the affidavit in support of the warrant authorizing the seizure of the 15 websites, these services offered easy access to attack infrastructure, payment options that included Bitcoin, and were relatively low cost. Each of the services was tested by the FBI, which verified those DDoS attack services offered through each of the seized websites. While testing the various services, the FBI determined that these types of services can and have caused disruptions of networks at all levels.
In conjunction with the seizure warrants, the U.S. Attorney’s Office for the Central District of California on Dec. 19 charged Matthew Gatrel, 30, of St. Charles, Illinois, and Juan Martinez, 25, of Pasadena, California, with conspiring to violate the Computer Fraud and Abuse Act through the operation of services known as Downthem and Ampnode. According to the criminal complaint filed in Los Angeles, Downthem offered DDoS services directly to users who wished to attack other internet users, and Ampnode offered resources designed to facilitate the creation of standalone DDoS services by customers. Between October 2014 and November 2018, Downthem’s database showed over 2000 customer subscriptions, and had been used to conduct, or attempt to conduct, over 200,000 DDoS attacks.
On Dec. 12, the U.S. Attorney’s Office for the District of Alaska charged David Bukoski, 23, of Hanover Township, Pennsylvania, with aiding and abetting computer intrusions. The charging documents allege that Bukoski operated Quantum Stresser, one of the longest-running DDoS services in operation. As of Nov. 29, Quantum had over 80,000 customer subscriptions dating back to its launch in 2012. In 2018 alone, Quantum was used to launch over 50,000 actual or attempted DDoS attacks targeting victims worldwide, including victims in Alaska and California.
“DDoS attacks are serious crimes that can cause real harm, as shown by the wide range of sectors allegedly victimized in this case,” said Assistant Attorney General Benczkowski. “The operators and the customers of DDoS-for-hire services should be on notice that the Department of Justice will aggressively prosecute those who perpetrate malicious cyber attacks.”
“DDoS for hire services such as these pose a significant national threat,” said U.S. Attorney Schroder. “Coordinated investigations and prosecutions such as these demonstrate the importance of cross-District collaboration and coordination with public sector partners.”
“The attack-for-hire websites targeted in this investigation offered customers the ability to disrupt computer networks on a massive scale, undermining the internet infrastructure on which we all rely,” said U.S. Attorney Hanna. “While this week’s crackdown will have a significant impact on this burgeoning criminal industry, there are other sites offering these services – and we will continue our efforts to rid the internet of these websites. We are committed to seeing the internet remain a forum for the free and unfettered exchange of information.”
“Whether you launch the DDoS attack or hire a DDoS service to do it for you, the FBI considers it criminal activity,” said FBI Assistant Director Gorham. “Working with our industry and law enforcement partners, the FBI will identify and potentially prosecute you for this activity. We will use every tool at our disposal to combat all forms of cybercrime including DDoS activity. We encourage all DDoS victims to contact your local FBI field office or file a complaint with the FBI’s Internet Crime Complaint Center at www.ic3.gov.”
Over the past five years, booter and stresser services have grown as an increasingly prevalent class of DDoS attack tools. These types of DDoS attacks are so named because they result in the “booting” or dropping of the victim-targeted website from the internet. Booter-based DDoS attack tools offer a low barrier to entry for users looking to engage in cyber criminal activity, representing an effective advance in internet attack technology.
For additional information on booter and stresser services and the harm that they cause, please visit: https://www.ic3.gov/media/2017/171017-2.aspx.
The charges in the indictment and criminal complaint are merely allegations, and the defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The cases announced today are being investigated by the FBI’s Anchorage Field Office and the FBI’s Cyber Initiative and Resource Fusion Unit (CIRFU). Additional assistance was provided by the FBI’s Chicago, Los Angeles, Memphis, and Philadelphia Field Offices and the Scranton, Pennsylvania Resident Agency; the Major Cyber Crimes Unit, Global Operations and Targeting Unit, and Money Laundering Intelligence Unit of FBI Headquarters; Defense Criminal Investigative Service; and the U.S. Attorney’s Offices for the Eastern District of Pennsylvania, Middle District of Pennsylvania, Western District of Tennessee and the Northern District of Illinois. The United Kingdom’s National Crime Agency, the Dutch National Police – National High Tech Crime Unit, and the National Cyber-Forensics & Training Alliance made invaluable contributions. Akamai, Bell Aliant, Cloudflare, Entertainment Software Association, Flashpoint, Google, Oath Inc., Oracle, Palo Alto Networks Unit 42, PayPal, Riot Games, ShadowDragon, SpyCloud, University of Cambridge and other valued private sector partners provided additional assistance.
Criminal Charges Filed in Los Angeles and Alaska in Conjunction with Seizures of 15 Websites Offering DDoS-For-Hire ServicesRead the Press Release
LOS ANGELES – The Justice Department today announced the seizure of 15 internet domains associated with DDoS-for-hire services, as well as criminal charges against three defendants who facilitated the computer attack platforms.
The sites, which offered what are often called “booter” or “stresser” services, allowed paying users to launch powerful distributed denial-of-service, or DDoS, attacks that flood targeted computers with information and prevent them from being able to access the internet. Booter services such as those named in this action allegedly cause attacks on a wide array of victims in the United States and abroad, including financial institutions, universities, internet service providers, government systems, and various gaming platforms.
The action against the DDoS services comes the week before the Christmas holiday, a period historically plagued by prolific DDoS attacks in the gaming world.
Pursuant to seizure warrants issued by a federal judge in Los Angeles, the FBI on Wednesday seized the domains of 15 booter services, which represent some of the world’s leading DDoS-for-hire services. Among these sites were critical-boot.com, ragebooter.com, downthem.org, and quantumstress.net.
According to the affidavit in support of the warrant authorizing the seizure of the 15 websites, these services offered easy access to attack infrastructure, payment options that included Bitcoin, and were relatively low cost. Each of the services was tested by the FBI, which verified those DDoS attack services offered through each of the seized websites. While testing the various services, the FBI determined that these types of services can and have caused disruptions of networks at all levels.
In conjunction with the seizure warrants, federal prosecutors in Los Angeles on Wednesday filed a criminal complaint that charges Matthew Gatrel, 30, of St. Charles, Illinois, and Juan Martinez, 25, of Pasadena, California, with conspiring to violate the Computer Fraud and Abuse Act through the operation of services known as Downthem and Ampnode. According to affidavit in support of the criminal complaint, Downthem offered DDoS services directly to users who wished to attack other internet users, and Ampnode offered resources designed to facilitate the creation of standalone DDoS services by customers. Between October 2014 and November 2018, Downthem’s database showed over 2000 customer subscriptions, and had been used to conduct, or attempt to conduct, over 200,000 DDoS attacks.
“The attack-for-hire websites targeted in this investigation offered customers the ability to disrupt computer networks on a massive scale, undermining the internet infrastructure on which we all rely,” said United States Attorney Nick Hanna. “While this week’s crackdown will have a significant impact on this burgeoning criminal industry, there are other sites offering these services – and we will continue our efforts to rid the internet of these websites. We are committed to seeing the internet remain a forum for the free and unfettered exchange of information.”
In a case related to Ampnode, the United States Attorney’s Office for the District of Alaska last week charged David Bukoski, 23, of Hanover Township, Pennsylvania, with aiding and abetting computer intrusions. The charging documents allege that Bukoski operated Quantum Stresser, one of the longest-running DDoS services in operation. As of late last month, Quantum had over 80,000 customer subscriptions dating back to its launch in 2012. In 2018 alone, Quantum was used to launch over 50,000 actual or attempted DDoS attacks targeting victims worldwide, including victims in Alaska and California.
“DDoS for hire services such as these pose a significant national threat,” said Bryan Schroder, the United States Attorney for the District of Alaska. “Coordinated investigations and prosecutions such as these demonstrate the importance of cross-District collaboration and coordination with public sector partners.”
“DDoS attacks are serious crimes that can cause real harm, as shown by the wide range of sectors allegedly victimized in this case,” said Assistant Attorney General Bryan A. Benczkowski, of the Justice Department’s Criminal Division. “The operators and the customers of DDoS-for-hire services should be on notice that the Department of Justice will aggressively prosecute those who perpetrate malicious cyber attacks.”
“Whether you launch the DDoS attack or hire a DDoS service to do it for you, the FBI considers it criminal activity,” said FBI Assistant Director Matthew Gorham. “Working with our industry and law enforcement partners, the FBI will identify and potentially prosecute you for this activity. We will use every tool at our disposal to combat all forms of cybercrime including DDoS activity. We encourage all DDoS victims to contact your local FBI field office or file a complaint with the FBI’s Internet Crime Complaint Center at www.ic3.gov.”
Over the past five years, booter and stresser services have grown as an increasingly prevalent class of DDoS attack tools. These types of DDoS attacks are so named because they result in the “booting” or dropping of the victim-targeted website from the internet. Booter-based DDoS attack tools offer a low barrier to entry for users looking to engage in cyber criminal activity, representing an effective advance in internet attack technology.
The charges in the indictment and criminal complaint are merely allegations, and the defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The criminal case against Gatrel and Martinez is being prosecuted by Assistant United States Attorney Cameron Schroeder of the Cyber and Intellectual Property Crimes Section in Los Angeles.
Assistant United States Attorney Jonathan Galatzan of the Asset Forfeiture Section is handling the seizure of the domains.
The case against Bukoski is being prosecuted by Assistant U.S. Attorney Adam Alexander of the District of Alaska and Trial Attorney C. Alden Pelker of the Computer Crime and Intellectual Property Section (CCIPS) of the Justice Department’s Criminal Division. CCIPS and the two Districts are also coordinating cryptocurrency seizures.
The cases announced today are being investigated by the FBI’s Anchorage Field Office and the FBI’s Cyber Initiative and Resource Fusion Unit (CIRFU). Additional assistance was provided by the FBI’s Chicago, Los Angeles, Memphis, and Philadelphia Field Offices and the Scranton, Pennsylvania Resident Agency; the Major Cyber Crimes Unit, Global Operations and Targeting Unit, and Money Laundering Intelligence Unit of FBI Headquarters; Defense Criminal Investigative Service; and the U.S. Attorney’s Offices for the Eastern District of Pennsylvania, Middle District of Pennsylvania, Western District of Tennessee, and the Northern District of Illinois. The United Kingdom’s National Crime Agency, the Dutch National Police – National High Tech Crime Unit, and the National Cyber-Forensics & Training Alliance made invaluable contributions. Akamai, Bell Aliant, Cloudflare, Entertainment Software Association, Flashpoint, Google, Oath, Inc., Oracle, Palo Alto Networks Unit 42, PayPal, Riot Games, ShadowDragon, SpyCloud, University of Cambridge, and other valued private sector partners provided additional assistance.
Criminal Charges Filed in Alaska in Conjunction with the Seizure of Websites Offering DDoS-For-Hire ServicesRead the Press Release
Anchorage, Alaska – U.S. Attorney Bryan Schroder announced today the seizure of an internet domain associated with DDoS-for-hire services, as well as criminal charges against a Pennsylvania man who facilitated the computer attack platform. This case was brought as part of an FBI investigation that led to the seizure of 15 websites, resulting in criminal charges filed from the U.S. Attorney’s Offices for the District of Alaska and the Central District of California.
The sites, which offered what are often called “booter” or “stresser” services, allowed paying users to launch powerful distributed denial-of-service, or DDoS, attacks that flood targeted computers with information and prevent them from being able to access the internet. Booter services such as named in this action allegedly cause attacks on a wide array of victims in the United States and abroad, including financial institutions, universities, internet service providers, government systems, and various gaming platforms. The action against the DDoS services comes the week before the Christmas holiday, a period historically plagued by prolific DDoS attacks in the gaming world.
The U.S. Attorney’s Office for the District of Alaska charged David Bukoski, 23, of Hanover Township, Pennsylvania, with aiding and abetting computer intrusions. The charging documents allege that Bukoski operated Quantum Stresser, one of the longest-running DDoS services in operation. As of Nov. 29, Quantum had over 80,000 customer subscriptions dating back to its launch in 2012. In 2018 alone, Quantum was used to launch over 50,000 actual or attempted DDoS attacks targeting victims worldwide, including victims in Alaska and California. On Dec. 19, pursuant to seizure warrants issued by the U.S. District Court for the Central District of California, the FBI seized the domains of 15 booter services, one of them being quantumstress.net, the service operated by Bukoski.
“The internet has become the nerve system of modern life, including modern business and government operations,” said U.S. Attorney Schroder. “Against that backdrop, it is essential for law enforcement officers and prosecutors to act swiftly and decisively when criminals attack any part of that system, especially the end users.”
“FBI Anchorage’s Cyber squad worked closely with the FBI’s Los Angeles, Chicago, and Philadelphia Field Offices to address the severe threat posed by DDoS-for-hire in advance of the holiday season,” said Jeffery Peterson, the Special Agent in Charge of FBI’s Anchorage Field Office. “The FBI could not have conducted this successful investigative effort without the cooperation of our international law enforcement and private industry partners. Criminal enterprises and individual actors routinely use DDoS to disrupt networks and damage internet-based services, often resulting in substantial financial losses to companies and individuals. The FBI will continue to aggressively pursue all crimes in cyberspace and strengthen America's cybersecurity.”
Over the past five years, booter and stresser services have grown as an increasingly prevalent class of DDoS attack tools. These types of DDoS attacks are so named because they result in the “booting” or dropping of the victim-targeted website from the internet. Booter-based DDoS attack tools offer a low barrier to entry for users looking to engage in cyber criminal activity, representing an effective advance in internet attack technology. For additional information on booter and stresser services and the harm that they cause, please visit: https://www.ic3.gov/media/2017/171017-2.aspx.
The case against Bukoski is being prosecuted by Assistant U.S. Attorney Adam Alexander of the District of Alaska and Trial Attorney C. Alden Pelker of the Computer Crime and Intellectual Property Section (CCIPS) of the Criminal Division.
The case announced today is being investigated by the FBI’s Anchorage Field Office and the FBI’s Cyber Initiative and Resource Fusion Unit (CIRFU). Additional assistance was provided by the FBI’s Chicago, Los Angeles, Memphis, and Philadelphia Field Offices and the Scranton, Pennsylvania Resident Agency; the Major Cyber Crimes Unit, Global Operations and Targeting Unit, and Money Laundering Intelligence Unit of FBI Headquarters; Defense Criminal Investigative Service; and the U.S. Attorney’s Offices for the Eastern District of Pennsylvania, Middle District of Pennsylvania, Western District of Tennessee and the Northern District of Illinois. The United Kingdom’s National Crime Agency, the Dutch National Police – National High Tech Crime Unit, and the National Cyber-Forensics & Training Alliance made invaluable contributions. Akamai, Bell Aliant, Cloudflare, Entertainment Software Association, Flashpoint, Google, Oath Inc., Oracle, Palo Alto Networks Unit 42, PayPal, Riot Games, ShadowDragon, SpyCloud, University of Cambridge and other valued private sector partners provided additional assistance.
The charges in the indictment are merely allegations, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Columbus Man Pleads Guilty to Creating Child Pornography by Sexually Abusing 10-Year-Old GirlRead the Press Release
COLUMBUS, Ohio – Eric A. Zevely, 34, of Columbus, pleaded guilty in U.S. District Court to producing child pornography.
Zevely was one of six Central Ohio men charged recently who made online contact with each other and others who shared, or whom they believed to share, their sexual interest in minors, incest and child pornography.
Benjamin C. Glassman, United States Attorney for the Southern District of Ohio, Steve Francis, Special Agent in Charge, Homeland Security Investigations (HSI), Westerville Police Chief Joseph Morbitzer, Todd Wickerham, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Division, Franklin County Sheriff Dallas Baldwin, Ohio Attorney General Mike DeWine and other members of the Franklin County Internet Crimes Against Children (ICAC) task force announced the plea entered into today before Chief U.S. District Judge Edmund A. Sargus, Jr.
Zevely was indicted by a federal grand jury in August 2018.
According to court documents, Zevely engaged in thousands of communications with numerous other individuals in response to ads placed on Craigslist.
Zevely made contact with undercover officers from two separate task forces in response to online advertisements looking for like-minded individuals interested in “incest taboo young” sexual conduct.
A search of Zevely’s phone revealed explicit photographs of his sexual abuse of a 10-year-old female.
Producing child pornography is a federal crime punishable by a range of 15 to 30 years in prison.
U.S. Attorney Glassman commended the investigation of this case by the federal and local crimes against children task forces, as well as Assistant United States Attorneys Heather A. Hill and S. Courter Shimeall, who are prosecuting the case.
# # #
Cohoes Man Sentenced to 35 Years for Producing and Distributing Child PornographyRead the Press Release
ALBANY, NEW YORK – George Muzio, Jr., age 37, of Cohoes, New York, was sentenced today to 420 months in prison for the online sexual exploitation of children, and for the possession and distribution of child pornography.
The announcement was made by United States Attorney Grant C. Jaquith and Kevin M. Kelly, Special Agent in Charge of the Buffalo Field Office of Homeland Security Investigations (HSI).
United States District Judge Mae A. D’Agostino also sentenced Muzio to a lifetime term of supervised release, to begin following his term of imprisonment. Muzio will also be required to register as a sex offender upon his release from prison
Muzio pled guilty on July 9, 2018, to two counts of sexual exploitation of a child, six counts of distribution of child pornography, and one count of possession of child pornography.
In connection with his guilty plea, Muzio admitted that between August 2014 and May 2016, he communicated with 13 underage girls using his cell phone and the Kik Messenger application. The minors lived throughout North America and ranged in age from 11 to 17 years old, with most being between 13 and 14 years old at the time Muzio engaged them in text-message exchanges via Kik. The communications, which Muzio frequently steered towards sexual performances by the children, generally spanned thousands of messages sent and received over several months.
Muzio further admitted that he posed as a teenage boy, and repeatedly requested and received sexually explicit photographs from the underage girls he targeted. He texted detailed instructions to two victims about how he wanted them to pose in the sexually explicit photographs that they took and sent to him at his request. One of those victims, a resident of Montana with whom Muzio exchanged over 2,000 text messages over a period of 8 months, was 11 years old at the time. The second, a resident of Georgia with whom Muzio exchanged over 4,700 text messages over a period of 4 months, was 13 years old.
In addition, Muzio admitted that on 6 occasions between March 2015 and January 2016, he distributed child pornography videos from his Cohoes home through an Internet file-sharing program. He also admitted that on May 3, 2016, he possessed a laptop computer that contained approximately 400 child pornography videos depicting the sexual abuse of children as young as 10 years old.
In sentencing Muzio today, Judge D’Agostino told him: “What I find barbaric in this case is what [you] did to innocent children. Children are supposed to be able to lead their lives without being subjected to this kind of evil. Children are the people in society that we are supposed to protect above all others. The barbarism for me is what was done to these children and the way it was done.”
This case was investigated by HSI, with assistance from the Colonie Police Department and the Cohoes Police Department, and was prosecuted by Assistant U.S. Attorney Emmet O’Hanlon.
This case is prosecuted as part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the United States Attorneys’ Offices, 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 identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
Cleveland postal employee and the man she lived with indicted for conspiracy in which she stole at least 1,500 gift cards from the mail worth at least $47,000Read the Press Release
A U.S. Postal Service employee who worked at the main mail processing center in Cleveland and the man she lived with were indicted for their roles in a conspiracy in which she stole at least 1,500 gift cards from the mail worth at least $47,000.
Jennifer Riccardi, 46, and Joseph Dennis, 37, both of Cleveland, were indicted on charges including conspiracy to commit theft of mail and possession of stolen mail, conspiracy to commit access device fraud, possession of stolen mail and access device fraud. Riccardi was also charged with theft of mail by a postal employee.
U.S. Attorney Justin Herdman said: “This defendant is accused of stealing more than a thousand gift cards worth tens thousands of dollars, including birthday presents or other gifts people entrusted to the postal service for delivery to their family and loved ones. Those who steal mail will be held accountable for their actions, just like any other criminal.”
U.S. Postal Service Office of Inspector General Special Agent in Charge Kenneth F. Cleevely, Eastern Area Field Office, stated: “The vast majority of the 500,000 postal employees nationwide are hard-working, trust worthy individuals. However, when one of those employees choose to violate that trust and steal from the mail for personal gain, special agents with the USPS OIG will vigorously investigate and pursue federal prosecution when appropriate. When postal employees choose to steal from the mail, they risk their career, benefits, retirement, and possibly their freedom. To report theft of mail, or other postal employee crimes, contact special agents at www.uspsoig.gov or 888-USPS-OIG.”
In one night alone, Riccardi stole more than 100 apparent greeting cards. Among the stolen mail that was opened was a card from a mother to her daughter signed “Love you! Mom” and a card from an uncle and aunt wishing a “Happy 1st Birthday.”
According to the indictment:
Riccardi worked at the USPS Processing and Distribution Center at 2400 Orange Avenue in Cleveland. She stole cards, letters and other pieces of mail she believed contained gift cards, focusing primarily on brightly covered envelopes that appeared to contain greeting cards.
Riccardi concealed the mail she took from the mail stream in bags, her lunch box and other means. She transported the stolen mail to the residence she shared with Dennis during her mid-shift break or at the end of her shift.
Dennis and Riccardi sold at least 41 stolen gift cards and used stolen gift cards for purchases from Amazon, Kohl’s, Starbucks and other locations.
On December 11, 2017, Dennis and Riccardi possessed at their residence at least 108 pieces of stolen mail, $42,000 in cash, an automatic currency counter and 1,505 stolen gifts cards from approximately 230 merchants or vendors. Of those, 1,322 of the gift cards bore face values, which totaled approximately $47,000.
The conspiracy took place between December 2016 and December 11, 2017.
If convicted, the defendant’s sentence will be determined by the Court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violations. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
These cases were investigated by the U.S. Postal Service – Office of Inspector General, with assistance from the U.S. Postal Inspection Service and the Cleveland Division of Police. It is being prosecuted by Assistant U.S. Attorneys Elliot Morrison and James Lewis.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Cleveland employee indicted for extortion and accepting bribes after he accepted below-market improvements on his property from a contractor seeking city business and directed city projects to benefit himself, his outside businesses and his clientsRead the Press Release
A City of Cleveland employee was indicted for extortion, accepting bribes and other crimes after he accepted below-market improvements on his property from a contractor seeking city business and directed city projects to benefit himself, his outside businesses, and his clients.
Khalil Ewais, 43, of Cleveland, was indicted on charges including Hobbs Act extortion, receipt of a bribe, federal program theft, making false statements and filing false tax returns.
His brother Abdeljawad Ewais, 45, of Cleveland, was charged with filing false tax returns.
According to a 14-count indictment unsealed in federal court:
Ewais worked in the Mayor’s Office of Capital Projects as the section chief of construction in the division of engineering and construction. He oversaw construction inspectors who inspect work on the city’s roads, bridges and sidewalks. He had a fiduciary duty to act in the best interests of the city and its citizens.
Ewais also owned and operated Pioneer Engineering, a private engineering and consulting business that did work for private clients. He also, along with Abedeljawad Ewais and other family members, owned commercial and residential rental properties in and around Cleveland.
Company 1 bid on jobs with the City of Cleveland. In April 2015, it was awarded a contract to perform most of the resurfacing of residential streets in certain wards of Cleveland for two years. Company 1 bid approximately $5.8 million for the work.
Khalil Ewais, in his job with the city, had input into whether Company 1 received additional contracts from the city. Company 1 could not receive payment for the work it did until Ewais certified it was done appropriately. He could also direct Company 1 to complete “corrective work” which would cost the company additional time and money. He could also use his official position to help Company 1 obtain faster payment for its services.
Ewais in August 2016 contacted multiple companies, including Company 1, about paving the parking lot adjacent to Captain’s Grill, a property at 6104 Storer Ave. that he and his brother owned. Quotes for the work ranged from $48,923 to $59,152.
Ewais contacted an owner of Company 1 on August 10, 2016, about the estimate for the parking lot and said “I need it to be in the $25K range.” The owner quickly responded, “I will do the job for a lump sum of $26,000.”
Company 1 was busy performing larger jobs for the city at the time, and so hired subcontractors to complete the work at Ewais’s parking lot.
While doing the work, the subcontractor learned the connection between the parking lot and the sewer was damaged and would need to be replaced. Ewais used his position to categorize that work as repair work for the city.
Ewais also used his official position to cause the city to pay to repave most of the short public alleyway next to the parking lot, West 62nd Place. Around Oct. 25, 2016, Company 1— at the direction of Ewais — instructed a subcontractor to expand the scope of its work on the parking lot job to include milling and paving the part of West 62nd Place that adjoined the parking lot, but not the short additional distance to reach the home at the end of the alleyway.
The work was completed on Nov. 5, 2016, with the parking lot connected to West 62nd Place. Company 1 spent approximately $81,534 to complete the work. Ewais paid $31,336 for the work and Company 1 did not request any further payment.
In designating the portion West 62nd Place adjoining his property to be repaved, Ewais avoided the established process for selecting streets to be resurfaced. The city, through a contractor, had sought to rate the condition of all the streets in Cleveland leading up to the 2016 resurfacing program. The city’s pavement management group, which included Ewais, met to discuss the lowest-rated streets in each ward to recommend to the City Council members which streets to include as part of the resurfacing program. The list of streets to be resurfaced never included West 62nd Place, which never even received a rating in the evaluation process.
Ewais, on his own accord, created a task order for resurfacing West 62nd Place around October 2016. It had an estimated cost of $9,363.70, to be paid to Company 1 under its contract with the city. He also created a task order for Americans with Disabilities Act-compliant ramps at the corners of West 62nd Place and Storer Avenue, at an estimated cost of $5,898, to be paid to another contractor. Ewais on Oct. 28, 2016, sent Company 1 a copy of the resurfacing task order to indicate Company 1 should repave West 62nd Street under its city contract.
Also in 2016, Ewais had a private client through Pioneer Engineering. Ewais used his position with the city to change the Lorain Avenue Rehabilitation plans to create a parking pull-off lane sought by his client. The cost to the city was approximately $10,000.
In 2017, Ewais agreed to help another client get additional street parking off Melbourne Avenue. This would require moving a utility pole, which the client would be billed for if the move were part of a private project. But the utility company would pay the cost of moving the pole if it were part of a public City of Cleveland project.
In order to ensure his private client would not be billed for moving the pole, Ewais contacted the utility company from his City of Cleveland email address. He used his official position and title and made false and misleading statements that were intended to, and did, mislead representatives of the utility to believe that moving the pole to create a parking pull-off was a public project.
Ewais sent an email from his city email address to an employee of the public utility and others on June 13, 2017. The email subject was: “Pole Place[d] Incorrectly in the Public R/W [Right of Way]. The email stated: “The City has been working with the Developer at the above address for over a year to renovate this building and bring in some new tenants. There is a plan to implement a pull off lane off Melbourne Avenue to accommodate some parking requirements.” It also stated the utility had “placed a pole in the middle of the proposed parking area” and that “[t]his pole will need to be relocated so as not to hamper this improvement.”
Both Khalil and Abdeljawad Ewais also filed numerous false tax returns in which they failed to report rental income.
U.S. Attorney Justin Herdman said: “Public service is a privilege, not a license to get preferential treatment and discounted improvements. This defendant used his job at City Hall to benefit himself and put his personal interests ahead of the people of Cleveland he was supposed to be serving.”
“Our tax-paying citizens are entitled to decisions based on the best interests of the public, not the best interests of corrupt government employees who want to financially benefit themselves,” FBI Acting Special Agent in Charge Robert E. Hughes said. “The FBI will continue to work with our law enforcement partners and the United States Attorney's Office to ensure those who violate the public trust are held accountable.”
“Today’s indictment serves as a reminder that no matter the source of income, taxpayers, and especially government employees have an obligation to the American public to pay their fair share of income taxes,” said Ryan Korner, Special Agent in Charge, IRS-Criminal Investigation’s Cincinnati Field Office. “Bringing to justice those who abscond from their tax liabilities has been and will continue to be a top priority.”
“The charges disclosed today prove our continuing resolve to root out fraud and corruption in all forms,” said Brad Geary, Special Agent in Charge, U.S. Department of Housing and Urban Development – Office of Inspector General. “It is our continuing core mission to work with our federal law enforcement partners and the United States Attorney’s Office to protect the integrity of our housing programs and to take strong action against those who seek to personally benefit from taxpayer-funded grants.”
If convicted, the defendant's sentence will be determined by the Court after reviewing factors unique to this case, including the defendant's prior criminal record, if any, the defendant's role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case was investigated by the Federal Bureau of Investigation, Internal Revenue Service – Criminal Investigations, the U.S. Department of Housing and Urban Development – Office of Inspector General and the Cleveland Division of Police. It is being prosecuted by Assistant U.S. Attorneys Chelsea S. Rice and Elliot Morrison.
An indictment is only a charge and is not evidence of guilt. The burden of proof is always on the government to prove a defendant guilty beyond a reasonable doubt.
City of Fort Lauderdale Department of Parks and Recreation Employee Pleads GuiltyRead the Press Release
Two individuals, including a City of Fort Lauderdale Parks and Recreation Department employee, pled guilty yesterday before U.S. District Judge Beth Bloom in Miami.
Ariana Fajardo Orshan, U.S. Attorney for the Southern District of Florida, George L. Piro, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, and Rick Maglione, Chief, Fort Lauderdale Police Department (FLPD) made the announcement.
Phillip Richard Peterson, 42, of Coral Springs, Florida, pled guilty to six counts of an indictment, charging him with theft from a program receiving federal funds and conspiracy to commit wire fraud, in violation of Title 18, United States Code, Sections 666, 1343 and 1349 (18-CR-60278). Each theft count of conviction covers a single year, beginning in 2013 and running through 2017. Peterson faces a maximum statutory sentence of ten years in prison, for each theft count. In addition, he faces a fine of up to $250,000.
Co-defendant Gino Joseph Ferraro, age 49, of Fort Lauderdale, Florida, also pled guilty to one count of conspiracy to commit wire fraud. Both defendants face a maximum statutory sentence of twenty years in prison and a potential fine of up to $250,000, for the conspiracy conviction.
According to the court docket, including an agreed upon factual proffer, Peterson had been issued a credit card by the City of Fort Lauderdale in connection with his employment to allow him to make job related purchases, on behalf of the Department of Parks and Recreation. Peterson purchased items using his City of Fort Lauderdale credit card, and then sold the items to a local pawn store. Each year, between 2013 and 2017, Peterson sold more than $5,000 worth of merchandise in this manner.
The court docket also indicates that Peterson and Ferraro unjustly enriched themselves by charging the City of Fort Lauderdale Parks and Recreation Department for volleyball court repairs and other items that were not completed or provided. Ferraro admitted that Peterson had paid him using his City issued credit card, and he would give Peterson approximately half of the amount that had been charged.
The defendants are scheduled to be sentenced by Judge Bloom on March 1, 2019.
U.S. Attorney Fajardo Orshan commended the investigative efforts of the FBI and FLPD in this matter. This case is being prosecuted by Assistant U.S. Attorney Cynthia R. Wood.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or at http://pacer.flsd.uscourts.gov.
Chinese Citizens Sentenced in Scheme to Sell Mislabeled Dietary SupplementsRead the Press Release
Zhang Xiao Dong (aka “Mark Zhang”), of Shanghai, China, was sentenced in Dallas today to 24 months’ imprisonment and two years of supervised release in connection with a scheme to sell mislabeled dietary supplements, the Department of Justice announced.
Zhang was the Sales Manager for Genabolix USA, Inc. and Shanghai Yongyi Biotechnology Co., Ltd., Chinese firms that sell raw ingredients for use in dietary supplements. Zhang pleaded guilty in April 2018 in the Northern District of Texas to one count of mail fraud. Zhang’s co-defendant, Gao Mei Fang (a.k.a. Amy Gao), the Supply Chain Manager for Genabolix, was sentenced on July 17, 2018, to 12 months and a day of imprisonment after pleading guilty in April 2018.
In pleading guilty, Zhang and Gao admitted that they agreed to help sell synthetic stimulant ingredients to a purported dietary supplement manufacturer in the United States. According to an indictment returned in October 2017, Zhang, Gao, and another co-defendant agreed with a confidential government informant to either mislabel the synthetic ingredients or to otherwise help hide the true nature of a proposed dietary supplement from retailers. Zhang and Gao admitted that they knew major American dietary supplement retailers would refuse to carry supplements known to contain certain stimulants, such as DMAA. Gao also admitted to making false statements to FDA’s import division regarding a shipment of synthetic stimulants entering the United States.
“Americans must be able to trust that the products they consume are safe,” said Assistant Attorney General Jody Hunt for the Department of Justice’s Civil Division. “This case shows that we will continue to prosecute those who attempt to import dangerous ingredients into the United States.”
Zhang and Gao were sentenced by U.S. District Court Judge Lindsay of the Northern District of Texas. Gao and Zhang both were arrested in September 2017 while attending a dietary supplement trade show in Las Vegas. A third defendant named in the case, Hu Chang Chun, is not believed to be in the United States.
“Consumers deserve to know exactly what they’re ingesting,” said U.S. Attorney Erin Nealy Cox of the Northern District of Texas. “We will not allow this sort of subterfuge to go unchecked in north Texas.”
“American consumers are put at risk when the true nature of ingredients for dietary supplements is hidden,” said Charles L. Grinstead, Special Agent in Charge, FDA Office of Criminal Investigations’ Kansas City Field Office. “We will continue to pursue and bring to justice those who jeopardize the public health.”
The case was investigated by FDA’s Office of Criminal Investigations. The case was prosecuted by David Sullivan and Patrick R. Runkle, Trial Attorneys in the Department of Justice’s Consumer Protection Branch, and Kate Rumsey and Douglas Brasher, Assistant United States Attorneys for the Northern District of Texas.
Additional information about the Consumer Protection Branch and its enforcement efforts may be found at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the Northern District of Texas, visit its website at https://www.justice.gov/usao-ndtx.
Child Predator Sentenced to 300 Months for Enticement and Child Pornography OffensesRead the Press Release
KNOXVILLE, Tenn. - On December 20, 2018, Justin Kyle Phelps, 27, of Philadelphia, Tennessee, was sentenced by the Honorable Pamela L. Reeves, U.S. District Judge, to serve 300 months in federal prison for enticing and attempting to entice minors for sex and using a minor to engage in sexually explicit conduct for the purpose of producing child pornography. Following his release from prison, Phelps will be supervised by the U.S. Probation Office for 10 years and be required to register with the sex offender registry in any state in which he resides, works, or attends school.
In March 2017, Phelps was arrested when he travelled to Knoxville for the purpose of meeting a minor female for sex. The investigation revealed that he had victimized several minors between the ages of 12 and 15 years, including having sex with some of them and obtaining pornographic photographs of other minors taken at his direction. In July 2018, Phelps pleaded guilty to knowingly enticing and attempting to entice minors through social media for illegal sexual activity.
“Online predators are constantly looking for children to sexually abuse. This prosecution represents part of our efforts to work with law enforcement agencies to protect children from persons who seek to manipulate kids, from the shadows of the internet, for illegal sex and child pornography,” said J. Douglas Overbey, U.S. Attorney for the Eastern District of Tennessee.
This investigation was conducted by the Knoxville Police Department’s Internet Crimes Against Children Unit and the U.S. Department of Homeland Security - Homeland Security Investigations. Assistant U.S. Attorney Matthew Morris represented the United States in court proceedings.
This case was brought as part of Project Safe Childhood (PSC), a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section, PSC 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 PSC, please visit www.projectsafechildhood.gov.
###
Chicago-Area Man Sentenced to 10 Years and 10 Months for Traveling to Coldwater and Robbing Cell Phone StoreRead the Press Release
GRAND RAPIDS, MICHIGAN - U.S. District Judge Gordon J. Quist sentenced Tramain Hill to 130 months in federal prison for committing an interstate cell phone store robbery with three other people. Hill was also ordered to repay $42,129.44 in restitution and serve 3 years under court supervision following release from prison.
On August 27, 2016, Hill and three associates met up in Kankakee, Illinois to prepare to rob a cell phone store. The crew had recently stolen a Mitsubishi Eclipse in Chicago, and they planned to use it as a getaway vehicle. On August 27, they loaded into the Eclipse and another car.
At approximately 6:50 PM, two of the crew entered a Universal Wireless store at 849 E. Chicago Street in Coldwater, Michigan. After entering, one robber pulled a gun, pointed it at the three employees and one customer present, and herded everyone to a back room. Once in the back room, the other robber bound everyone’s wrists and ankles with zip ties, stole the property of the employees and customer, and proceeded to steal approximately $40,000 in cell phones from the store. The robbers stashed their proceeds in a black trash bag and exited through the back door of the store. The robbers then traveled back to central Illinois, where they sold the cell phones to a fence.
To date, three of the four robbers have been prosecuted federally. Two of them are pending sentencing in the Central District of Illinois.
The Coldwater Police Department and Federal Bureau of Investigation investigated this case. Assistant United States Attorney Davin M. Reust prosecuted it.
END
Charleston Man Sentenced for Federal Drug CrimeRead the Press Release
CHARLESTON, W.Va. -- A Charleston man was sentenced for a federal drug crime, announced United States Attorney Mike Stuart. Fabian Woodson, 36, was sentenced to 51 months in prison for possessing with intent to distribute heroin on January 4, 2016.
“Fentanyl laced heroin and an arsenal of firearms,” said United States Attorney Mike Stuart. “With Woodson off the streets, the Kanawha Valley is a safer place.”
On September 2, 2015, members of the Metro Drug Unit initiated a traffic stop on a vehicle in which Woodson was a passenger in South Charleston, West Virginia. When the vehicle stopped, Woodson exited the vehicle and attempted to flee from the officers on foot. The officers apprehended him and recovered approximately 20 grams of heroin from the vehicle that Woodson admitted he possessed while in the vehicle. Woodson also admitted that he sold a confidential informant working for the Metro Drug Unit .8 grams of heroin in exchange for $150 on both December 14 and December 17, 2015.
On January 4, 2016, detectives with the Metro Drug Unit executed a search warrant on a home in Elkview where Woodson was residing and found suspected heroin, that Woodson admitted he intended to sell, suspected crack, and marijuana. They also found a loaded Ruger .380 caliber handgun, a loaded Colt .25 caliber handgun, a loaded Glock .26 caliber handgun, a loaded .22 caliber Beretta, and $7,613 in United States Currency, which included $150 of buy money from a previous controlled drug buy conducted by members of the Metro Drug Unit. The drugs seized from Woodson on January 4, 2016, were submitted to the West Virginia State Police Lab for testing, and confirmed to be heroin containing fentanyl weighing 27.58 grams, 3.268 grams of cocaine base, and 398 grams of marijuana.
United States District Court Judge John T. Copenhaver Jr. imposed the sentence.
The Metro Drug Unit was in charge of the investigation. Monica D. Coleman is handling the prosecution.
Follow us on Twitter: @SDWVNews and @USAttyStuart
###
Charleston Man Pleads Guilty to Federal Firearms ChargeRead the Press Release
CHARLESTON, W.Va. – A Charleston man pled guilty to a federal firearms charge, said United States Attorney Mike Stuart. Michael D. Williams, 49, pled guilty to being a felon in possession of a firearm. Williams was on supervised release for a prior federal conviction for conspiracy to commit arson. The investigation was conducted by the Charleston Police Department, with assistance from the Bureau of Alcohol, Tobacco, Firearms and Explosives.
“Defendants like Williams increase the recidivism rate,” said United States Attorney Mike Stuart. “And these are the types of crimes, committed by violent, repeat offenders that are the focus of our Project Safe Neighborhoods initiative.”
On October 13, 2018, Williams got in an altercation at the Transit Mall in downtown Charleston and pulled a firearm on an individual. An officer from the Charleston Police Department witnessed the altercation and arrested Williams.
Williams faces up to 10 years in prison on the felon in possession charge and an additional 24 months in prison for the supervised released violation when he is sentenced on March 14, 2019.
United States District Judge John T. Copenhaver, Jr. presided over the plea hearing. Assistant United States Attorney Steve Loew is handling the prosecution.
Project Safe Neighborhoods (PSN) is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
Follow us on Twitter: @SDWVNews and @USAttyStuart
###
California Man Sentenced to Nearly 4 Years in Federal Prison for Scheme to Smuggle Rifle Scopes and Tactical Equipment to SyriaRead the Press Release
Rasheed Al Jijakli, 57, a Syrian-born naturalized U.S. citizen who resides in Walnut, California, was sentenced today to 46 months in prison for his role in a scheme to smuggle rifle scopes and other tactical gear to Syria in violation of the International Emergency Economic Powers Act and sanctions imposed on Syria by the United States.
The announcement was made by Assistant Attorney General for National Security John C. Demers and U.S. Attorney Nicola T. Hanna for the Central District of California. The sentence was issued by U.S. District Judge James V. Selna.
During today’s sentencing hearing, Judge Selna agreed with prosecutors that the goods Jijakli took to Syria were “instruments of death.”
Jijakli pleaded guilty to the felony offense on Aug. 13 and admitted he conspired with others to export tactical gear from the United States to Syria. That tactical gear included U.S.-origin laser boresighters, and day- and night-vision rifle scopes.
From June through July of 2012, Jijakli and a co-conspirator purchased the tactical gear. On July 17, 2012, Jijakli traveled with the tactical gear from Los Angeles to Istanbul with the intent that it would be provided to Syrian rebels training in Turkey and fighting in Syria.
Jijakli provided some of the tactical gear, specifically the laser boresighters, to a second co-conspirator, who Jijakli learned was a member of the militant group Ahrar Al-Sham. Jijakli also provided the goods to other armed Syrian insurgent groups in Syria and Turkey.
Jijakli and his co-conspirators knowingly provided at least 43 laser boresighters, 85 day rifle scopes, 30 night-vision rifle scopes, tactical flashlights, a digital monocular, five radios, and one bulletproof vest to Ahrar Al-Sham and other Syrian rebels in Syria, or with knowledge that the tactical gear was going to Syria.
Additionally, in August and September 2012, Jijakli directed co-conspirators to withdraw thousands of dollars from Palmyra Corporation, where Jijakli was the chief executive officer, to pay for tactical gear that would be provided to Syrian rebels. In his plea agreement, Jijakli specifically admitted directing that $17,000 from Palmyra be used to purchase tactical gear intended for Syrian rebels.
The case against Jijakli was the result of an investigation conducted by the FBI, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the U.S. Department of Commerce’s Office of Export Enforcement, and IRS Criminal Investigation.
The case against Jijakli was prosecuted by Assistant U.S. Attorney Mark Takla of the Central District of California’s Terrorism and Export Crimes Section, and Trial Attorney Christian Ford of the National Security Division’s Counterintelligence and Export Control Section.
Bozeman man sentenced in meth caseRead the Press Release
BILLINGS—A Bozeman man accused of trafficking methamphetamine he brought from Denver to Montana was sentenced on Wednesday to three years in federal prison and five years of supervised release, U.S. Attorney Kurt G. Alme said.
Michael Arnold Delack, 49, pleaded guilty earlier to possession with intent to distribute meth.
U.S. District Judge Susan P. Watters presided at sentencing.
During an investigation in 2017 and early 2018, law enforcement made controlled meth buys from Delack using confidential informants and undercover agents. In August 2017, law enforcement learned that Delack was returning from Denver and was suspected of bringing meth. Investigators asked the Montana Highway Patrol to stop Delack’s vehicle. MHP stopped Delack in Big Horn County, where Delack told agents with the Bureau of Alcohol, Tobacco, Firearms and Explosives that he had about six ounces of meth inside a duffel bag in the vehicle.
In January 2018, a GPS monitoring device was placed on Delack’s vehicle, as authorized by a search warrant. The tracker indicated Delack was traveling out of state on Jan. 28 and traveling back to Montana the next day. On Jan. 30, MHP stopped Delack’s vehicle east of Columbus and searched the vehicle. Hidden in the engine compartment was a round metal tin containing 112.3 grams of meth. Delack admitted to traveling to Denver and buying four ounces of meth for $2,000. Four ounces of meth is the equivalent of about 896 individual doses.
Assistant U.S. Attorney Thomas Godfrey prosecuted the case, which was investigated by the ATF.
The case is part of Project Safe Neighborhoods (PSN), which is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
XXX
Berkeley County woman admits to firearms chargeRead the Press Release
MARTINSBURG, WEST VIRGINIA – Shauntae Cherie Placko, of Hedgesville, West Virginia, has admitted to a firearms charge, United States Attorney Bill Powell announced.
Placko, age 29, pled guilty to one count of “False Statement During Purchase of a Firearm.” Placko admitted to making a false statement when purchasing a pistol from a firearms dealer in Berkeley County in October 2017.
Placko faces up to five years incarceration and a fine of up to $250,000 for the false statement count. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
This case was brought as part of Project Safe Neighborhoods (PSN). Project Safe Neighborhoods 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.
Assistant U.S. Attorney Lara Omps-Botteicher is prosecuting the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives investigated.
U.S. Magistrate Judge Robert W. Trumble presided.