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Thursday 8 November 2018
U.S. Attorney's Office and DEA Announce Significant Milestone During 16th National Prescription Take Back DayRead the Press Release
LAS VEGAS, Nev. – With the robust participation of Americans nationwide, the Drug Enforcement Administration (DEA) and its law enforcement partners have now surpassed its 10 million pound goal and collected nearly 11 million pounds of unused, unwanted, or expired prescription medications over the course of 16 successful DEA National Prescription Drug Take Back events. During the 16th semiannual event on October 27, DEA and federal, state, and local partners disposed of more than 900,000 pounds of prescription medications collected at nearly 6,000 sites across the country. Together with almost 5,000 local, state and federal partners, DEA collected and destroyed more than 457 tons of potentially dangerous leftover prescription drugs.
This brings the total amount of prescription drugs collected by DEA since the Fall of 2010 to 10,878,950 pounds, or 5439.5 tons.
Nevadans participating in Take Back Day turned in a total of 4,455 pounds of unwanted or expired prescription medications for safe and proper disposal at 24 sites throughout the state.
“The results of our most recent Take Back Day clearly demonstrate a need for this initiative as a tool in the fight against America’s opioid crisis,” said Acting Administrator Uttam Dhillon. “The success of this event is a direct reflection of DEA’s commitment to prevent drug addiction and overdose deaths in the U.S. Together, we are all helping to make a difference to keep our friends and families safe.”
“Take Back Day events continue to provide an opportunity for citizens to safely remove unused, unwanted, and expired prescription medications from their homes,” said U.S. Attorney Elieson. “Proper disposal of unused drugs saves lives and protects the environment. I am grateful to every Nevadan who cleaned out their medicine cabinets and to our law enforcement partners who participated.”
Nevada law enforcement agencies that participated during Take Back Day included: Carson City Sheriff’s Office; Washoe County Sheriff’s Office; Douglas County Sheriff’s Office; Reno Police Department; Sparks Police Department; University of Nevada, Reno Police Department; Fallon Police Department; Winnemucca Police Department; Las Vegas Metropolitan Police Department and the North Las Vegas Police Department.
National Prescription Drug Take Back Day events continue to remove opioids and other medicines from the nation’s homes, where they could be stolen and abused by family members and visitors, including children and teens.
DEA began putting on Take Back Day events when the public had no other way to appropriately dispose of their leftover painkillers and other potentially dangerous drugs. These events have been extremely successful not only in getting unused drugs out of the house, but also in raising awareness of their link to addiction and overdose deaths. Since DEA launched this program nine years ago, doctors are prescribing fewer painkillers; and law enforcement agencies, pharmacies, and others have installed permanent prescription drug drop boxes on-site, making drug disposal even more convenient.
Helping people to dispose of potentially harmful prescription drugs is just one way DEA is working to reduce the addiction and overdose deaths plaguing this country due to opioid medications.
Parents and teens are encouraged to educate themselves about the dangers of legal and illegal drugs by visiting DEA’s websites at www.justthinktwice.com and www.GetSmartAboutDrugs.com.
Complete results for DEA’s 16th National Prescription Drug Take Back Day are available at www.deatakeback.com. The next Take Back Day is April 27, 2019.
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U.S. Attorney Jay E. Town Appointed to the Justice Department’s China InitiativeRead the Press Release
BIRMINGHAM – U.S. Attorney Jay E. Town appointed to serve on the Justice Department’s China Initiative.
The group is led by Assistant Attorney General John Demers, who heads the Department of Justice’s National Security Division. Town is one of five U.S. Attorneys—to include U.S. Attorneys from Massachusetts, California, New York and Texas— serving on the working group along with other Department of Justice leaders, senior FBI officials, and Assistant Attorney General for the Criminal Division, Brian Benczkowski.
The Initiative will pursue high priority Chinese economic espionage and trade secret cases. It reflects the Department’s strategic priority of countering Chinese national security threats and reinforces President Trump’s overall national security strategy.
“It is an honor and a privilege to join my colleagues in the FBI and Department of Justice to expose any threats to our national security posed by the theft of American innovation, American technology, and American intelligence. I look forward to the leadership of Assistant Attorney General John Demers,” Town said. “The Department of Justice remains on the front lines of these threats to our national security. U.S. companies, many of them with a footprint here in the Northern District of Alabama, spend billions developing intellectual property, trade secrets, and other proprietary information only to see it infringed upon by foreign bad actors. Whether state secrets or trade secrets, the China Initiative will offer profound resolve to those inimical threats posed to our sovereignty, by China.”
“China wants the fruits of America’s brainpower to harvest the seeds of its planned economic dominance,” said Assistant Attorney General for National Security John Demers. “Preventing this from happening will take all of us, here at the Justice Department, across the U.S. government, and within the private sector. We will confront China’s malign behaviors and encourage them to conduct themselves as they aspire to be: one of the world’s leading nations.”
Initiative Goals:
- Identify priority trade secret theft cases, ensure that investigations are adequately resourced; and work to bring them to fruition in a timely manner and according to the facts and applicable law;
- Develop an enforcement strategy concerning non-traditional collectors (e.g., researchers in labs, universities, and the defense industrial base) that are being coopted into transferring technology contrary to U.S. interests;
- Educate colleges and universities about potential threats to academic freedom and open discourse from influence efforts on campus;
- Apply the Foreign Agents Registration Act to unregistered agents seeking to advance China’s political agenda, bringing enforcement actions when appropriate;
- Equip the nation’s U.S. Attorneys with intelligence and materials they can use to raise awareness of these threats within their Districts and support their outreach efforts;
- Implement the Foreign Investment Risk Review Modernization Act (FIRMA) for DOJ (including by working with Treasury to develop regulations under the statute and prepare for increased workflow);
- Identify opportunities to better address supply chain threats, especially ones impacting the telecommunications sector, prior to the transition to 5G networks;
- Identify Foreign Corrupt Practices Act (FCPA) cases involving Chinese companies that compete with American businesses;
- Increase efforts to improve Chinese responses to requests under the Mutual Legal Assistance Agreement (MLAA) with the United States; and
- Evaluate whether additional legislative and administrative authorities are required to protect our national assets from foreign economic aggression.
Two men from Northwest Ohio indicted on firearms chargesRead the Press Release
Two men from Northwest Ohio were indicted on federal firearms charges.
David L. Hannah, 52, of Findlay, and Terrence Turner, 31, of Toledo, were both indicted on one count of possession of a firearm by a felon. Their cases are otherwise unrelated.
Hannah possessed nine firearms on Sept. 22, despite a previous conviction for being a felon in possession of a firearm. Hannah possessed two AM15, 5.56 mm rifles, two .22-caliber rifles, two 12-gauge shotguns and three handguns, according to the indictment.
Turner on Aug. 6 possessed a Smith & Wesson Model 15 firearm despite a previous conviction for domestic violence, according to the indictment
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.
The Hannah case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and is being prosecuted by Assistant U.S. Attorneys Ashley A. Futrell and Thomas P. Weldon. The Turner case was investigated by the ATF and Toledo Police Department and is being prosecuted by Assistant U.S. Attorney Matthew Simko
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.
Two Men Sentenced in Manhattan Federal Court for Defrauding Investors of over $7 Million in Fuel Cell Company Investor Fraud SchemeRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today that GEORGE DOUMANIS and EMANUEL PANTELAKIS were sentenced in Manhattan federal court to 53 months and one year and one day in prison, respectively, for defrauding investors in Terminus Energy, Inc., a publicly traded penny stock, of over $7 million. DOUMANIS and PANTELAKIS each pled guilty on December 1, 2017, to one count of conspiracy to commit securities fraud before U.S. District Judge Andrew L. Carter Jr., who also imposed today’s sentence.
U.S. Attorney Geoffrey S. Berman said: “George Doumanis and Emanuel Pantelakis lured investors for a supposed fuel cell technology they knew was a fiction. They duped victims into investing over $7 million with misleading documents, and they used more than $1 million of that to pay their own personal expenses. Today they learned the true price of that kind of criminal deceitfulness.”
According to the allegations contained in the Indictment filed against DOUMANIS, PANTELAKIS, and their co-conspirator, and statements made in related court filings and proceedings:
From at least February 2008 until at least 2014, DOUMANIS and PANTELAKIS, along with their co-conspirator Danny Pratte, who previously pled guilty, engaged in a scheme to defraud investors in the publicly traded company Terminus Energy, Inc. (“Terminus”), by inducing victims to invest in Terminus stock through material misrepresentations and omissions and by misappropriating investor funds for their own purposes.
Terminus was purportedly producing and marketing a commercially viable solid oxide “fuel cell” as an alternative energy source. DOUMANIS and PANTELAKIS sold shares of Terminus to investors through private offerings. In connection with such sales, DOUMANIS and PANTELAKIS provided investors with private placement memorandums (“PPMs”) that contained materially false and misleading statements. For example, the PPMs falsely stated that (i) Terminus had completed its goal of developing a working fuel cell in mid-2008; (ii) Terminus would use specified investor funds to make payment on third-party development contracts designed to manufacture a working fuel cell; and (iii) Terminus would pay no more than 10 percent in sales commissions. In truth, and as DOUMANIS and PANTELAKIS well knew, (i) there was no working fuel cell; (ii) the third-party contracts had been cancelled after Terminus failed to make payment to the third parties; and (iii) unregistered salespeople were receiving commissions far in excess of 10 percent. The PPMs also failed to accurately disclose the involvement of either DOUMANIS, who was barred from involvement in penny stocks as a result of a 2003 conviction for conspiracy to commit securities fraud, wire fraud, and mail fraud, or PANTELAKIS, who had been permanently barred by the Financial Industry Regulatory Authority (“FINRA”) following allegations that he had made fraudulent misrepresentations to customers in connection with the sale of securities. DOUMANIS and PANTELAKIS also caused similar misrepresentations to be made in business plans, executive summaries, and presentations shared with potential investors, as well as in publicly available press releases. Through these false and misleading statements, DOUMANIS and PANTELAKIS fraudulently induced investors to purchase over $7 million of Terminus stock.
Rather than use the investor money as promised, DOUMANIS and PANTELAKIS misappropriated the funds for their own use and for use by co-conspirators. DOUMANIS personally received at least $573,201 and PANTELAKIS personally received at least $428,997. In addition, the unregistered salespeople collectively received undisclosed commissions of more than $1.5 million.
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In addition to their prison terms, DOUMANIS, 60, of Rocky Point, New York, and PANTELAKIS, 43, of Queens, New York, were sentenced to three years of supervised release, forfeiture money judgments in the amount of $573,201 and $428,997, respectively, and restitution in an amount to be determined by the Court at a later date.
Danny Pratte pled guilty to one count of conspiracy to commit securities fraud and was sentenced by Judge Carter on October 19, 2018.
Mr. Berman praised the work of the Federal Bureau of Investigation and thanked the U.S. Securities and Exchange Commission.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Christine Magdo and Samson Enzer are in charge of the prosecution.
Two Employees of South Korean Conglomerate Charged with Defrauding U.S. Government in Army Base ConstructionRead the Press Release
Two employees of SK Engineering & Construction Co., Ltd. (SK), a large multinational corporation based in the Republic of Korea (South Korea), were charged today with participating in a scheme to defraud the United States by submitting fraudulent subcontracts to conceal bribes and kickbacks paid to an American public official, in relation to U.S. Army construction contracts in South Korea.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney D. Michael Dunavant of the Western District of Tennessee, Special Agent in Charge Ray Park of the U.S. Army Criminal Investigation Command (Army-CID) Pacific Fraud Field Office, Special Agent in Charge Stan Newell of the Defense Criminal Investigative Service (DCIS), and Assistant Director in Charge Paul D. Delacourt of the FBI’s Los Angeles Field Office made the announcement.
Hyeong-won Lee, 58, and Dong-Guel Lee, 48, both citizens of South Korea and employees of SK Engineering & Construction Co., Ltd. (SK), were charged with one count of conspiracy to defraud the United States and to commit wire fraud and obstruction of justice, and one count of major fraud against the United States. Hyeong-won Lee was also charged with two counts of wire fraud and one count of money laundering conspiracy, and Dong-Guel Lee was charged with one count of witness tampering in relation to a wide-ranging bribery and fraud scheme from 2008 to 2017. The defendants are not related.
“Hyeong-won Lee and Dong-Guel Lee allegedly submitted fraudulent construction subcontracts to disguise millions in kickback payments to a public official and then tried to cover their tracks,” said Assistant Attorney General Benczkowski. “The Department of Justice is dedicated to protecting taxpayer dollars by safeguarding the integrity of government contracts and construction projects that support our U.S. military and civilian personnel, wherever they serve around the world.”
“Protecting the U.S. Treasury and the interests of the federal government abroad is a top priority of this office, and this indictment shows our commitment to hold foreign actors accountable for major fraud committed against the United States,” said U.S. Attorney Dunavant.
According to the indictment, the defendants, acting on behalf of SK, submitted fraudulent subcontracts to the U.S. Army as part of two construction contracts at Camp Humphreys, South Korea, worth hundreds of millions of dollars. The indictment alleges that the defendants and their co-conspirators used these fraudulent subcontracts to launder millions of dollars in kickbacks for a U.S. public official who had steered two Camp Humphreys construction contracts to SK.
The indictment also alleges that the defendants obstructed investigations into the scheme. According to the indictment, Hyeong-won Lee ordered SK employees to destroy documents related to the fraudulent subcontract, and SK employees burned boxes of documents in order to prevent their use by investigators. The indictment also alleges that Dong-Guel Lee, acting on SK’s behalf, impeded federal investigations by dissuading witnesses from testifying about their knowledge of the scheme.
Army-CID, DCIS, and the FBI are investigating the case. Assistant Chief Justin Weitz of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Tony Arvin of the Western District of Tennessee are prosecuting the case. The Fraud Section is grateful for the assistance of the Criminal Division’s Public Integrity Section in this case.
The charges in the indictment are merely allegations, and the defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Two Employees of South Korean Conglomerate Charged with Defrauding U.S. Government in Army Base ConstructionRead the Press Release
Memphis, TN – Two employees of SK Engineering & Construction Co., Ltd. (SK), a large multinational corporation based in the Republic of Korea (South Korea), were charged today with participating in a scheme to defraud the United States by submitting fraudulent subcontracts to conceal bribes and kickbacks paid to an American public official, in relation to U.S. Army construction contracts in South Korea.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney D. Michael Dunavant of the Western District of Tennessee, Special Agent in Charge Ray Park of the U.S. Army Criminal Investigation Command (Army-CID) Pacific Fraud Field Office, Special Agent in Charge Stan Newell of the Defense Criminal Investigative Service (DCIS), and Assistant Director in Charge Paul D. Delacourt of the FBI’s Los Angeles Field Office made the announcement.
Hyeong-won Lee, 58, and Dong-Guel Lee, 48, both citizens of South Korea and employees of SK Engineering & Construction Co., Ltd. (SK), were charged with one count of conspiracy to defraud the United States and to commit wire fraud and obstruction of justice, and one count of major fraud against the United States. Hyeong-won Lee was also charged with two counts of wire fraud and one count of money laundering conspiracy, and Dong-Guel Lee was charged with one count of witness tampering in relation to a wide-ranging bribery and fraud scheme from 2008 to 2017. The defendants are not related.
"Hyeong-won Lee and Dong-Guel Lee allegedly submitted fraudulent construction subcontracts to disguise millions in kickback payments to a public official and then tried to cover their tracks," said Assistant Attorney General Benczkowski. "The Department of Justice is dedicated to protecting taxpayer dollars by safeguarding the integrity of government contracts and construction projects that support our U.S. military and civilian personnel, wherever they serve around the world."
"Protecting the U.S. Treasury and the interests of the federal government abroad is a top priority of this office, and this indictment shows our commitment to hold foreign actors accountable for major fraud committed against the United States," said U.S. Attorney Dunavant.
According to the indictment, the defendants, acting on behalf of SK, submitted fraudulent subcontracts to the U.S. Army as part of two construction contracts at Camp Humphreys, South Korea, worth hundreds of millions of dollars. The indictment alleges that the defendants and their co-conspirators used these fraudulent subcontracts to launder millions of dollars in kickbacks for a U.S. public official who had steered two Camp Humphreys construction contracts to SK.
The indictment also alleges that the defendants obstructed investigations into the scheme. According to the indictment, Hyeong-won Lee ordered SK employees to destroy documents related to the fraudulent subcontract, and SK employees burned boxes of documents in order to prevent their use by investigators. The indictment also alleges that Dong-Guel Lee, acting on SK’s behalf, impeded federal investigations by dissuading witnesses from testifying about their knowledge of the scheme.
Army-CID, DCIS, and the FBI are investigating the case. Assistant Chief Justin Weitz of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Tony Arvin of the Western District of Tennessee are prosecuting the case. The Fraud Section is grateful for the assistance of the Criminal Division’s Public Integrity Section in this case.
The charges in the indictment are merely allegations, and the defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Turtle Creek Felon Pleads Guilty to Firearms Charges after 3 Days of TrialRead the Press Release
PITTSBURGH, PA – A resident of Turtle Creek, Pennsylvania, pleaded guilty yesterday in federal court to two charges of possession of a firearm or ammunition by a convicted felon, United States Attorney Scott W. Brady announced today.
Iklas Richard Davis, age 37, pleaded guilty to two counts before United States District Judge Nora Barry Fischer. Davis pleaded guilty after three days of trial and after the government rested its case.
In connection with the trial and guilty pleas, the court was advised that, on or about July 27, 2016 and October 12, 2017, Davis, who has a prior felony conviction in Pennsylvania, knowingly possessed several firearms and ammunition. Law enforcement officers discovered the firearms and ammunition during the execution of a search warrant of Davis’s home and vehicle in 2016. One of the firearms was an AR-15 assault rifle engraved with the phrase "Let it Rain" and included graphics of skulls. Some of the ammunition were forty rounds contained in an extended magazine compatible with the AR-15. Davis shared that home with Quinyahta Rochelle, who has pleaded guilty to celebrity hacking, identity theft and firearms offenses. She is awaiting sentencing.
After the 2016 search warrant, Davis was charged by Wilkins Township Police Department and released on bond. However, United States Secret Service agents, working with the Allegheny County Police, subsequently developed evidence that Rochelle and Davis were engaged in various identity-theft related activities. Thus, Rochelle and Davis were both federally indicted for firearms-related offenses based on the 2016 search warrant, and law enforcement executed both the arrest warrants, which were for firearms-related offenses based on the 2016 search warrant, and new search warrants seeking evidence of identity-theft related offenses, on October 12, 2017. During that search, agents recovered another loaded firearm in the master bedroom closet, along with numerous rounds of ammunition and a bulletproof vest. Davis admitted to possessing that firearm, and he was federally indicted a second time for being a Felon in Possession of a Firearm. The two firearm cases – one based on the 2016 search warrant and the other based on the 2017 search warrant – were consolidated for trial, which began on November 5, 2018.
Judge Fischer scheduled sentencing for April 4, 2019 at 9 a.m. The law provides for a maximum sentence on each count of up to 10 years in prison, a fine of up to $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorneys Brendan T. Conway and Nicole Vasquez Schmitt are prosecuting this case on behalf of the government.
The United States Secret Service, the Federal Bureau of Investigation, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Allegheny County Police Department, and the Wilkins Township Police Department conducted the investigation that led to the prosecution of Davis.
Tucson Resident Sentenced to 36 Months in Prison for His Role in an Auto Loan Fraud SchemeRead the Press Release
TUCSON, Ariz. – Yesterday, Andrew May, 46, of Tucson, Ariz., was sentenced to 36 months’ imprisonment by U.S. District Judge Rosemary Marquez. May had previously pleaded guilty to one count of conspiracy to commit mail fraud and bank fraud.
The evidence established that May, through his shell companies, engaged in an extensive auto-loan fraud scheme. As part of the scheme, May and his co-conspirators fraudulently represented to the lenders that they were engaged in the legitimate purchase and sale of vehicles in order to obtain financing from numerous financial institutions. The co-conspirators further fraudulently represented that the lenders would receive a lien on the vehicles as collateral for the loans. However, no legitimate vehicle sales occurred. The lenders funded approximately $1.2 million dollars traced to numerous bank accounts controlled by May.
In addition to personally using over $500,000, May distributed portions of the fraudulent proceeds to the co-conspirators. Most of the fraudulent loans went into default, resulting in significant losses to the lenders. As part of the sentence, the court ordered that May forfeit a vehicle and trailer that he obtained using the loan fraud proceeds. The court also scheduled a restitution hearing for Nov. 19, 2018.
The investigation in this case was conducted by the United States Secret Service, United States Postal Inspection Service, and the Marana Police Department. The prosecution was handled by the U.S. Attorney’s Office District of Arizona, Tucson.
CASE NUMBER: CR-17-1429-TUC-RCC
RELEASE NUMBER: 2018-150_May
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For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az
Three Maryland Men Indicted in Conspiracy to Distribute Fentanyl in Baltimore Trafficked from Sinaloa and Tijuana Drug CartelsRead the Press Release
Baltimore, Maryland – A federal grand jury has indicted Nevone McCrimmon, age 47, of Edgewood, Maryland; William Elijah, age 51; and Terrance Mobley, age 50, both of Baltimore, Maryland, on the federal charge of conspiracy to distribute and possess with intent to distribute 400 grams or more of fentanyl. The indictment was returned on October 24, 2018, and unsealed on October 30, 2018. McCrimmon was arrested today and is scheduled to have his initial appearance at 3:45 p.m. in U.S. District Court in Baltimore.
The indictment was announced by United States Attorney for the District of Maryland Robert K. Hur; Assistant Special Agent in Charge Don A. Hibbert of the Drug Enforcement Administration, Baltimore District Office; Interim Commissioner Gary Tuggle of the Baltimore Police Department; Baltimore City Sheriff John Anderson; Chief Terrence B. Sheridan of the Baltimore County Police Department; and Acting Special Agent in Charge Cardell T. Morant of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Baltimore.
“Fentanyl is one of the most lethal threats facing Maryland right now. As little as two milligrams of fentanyl can be a lethal dose, and the 20 kilograms of fentanyl seized in this case to date is enough to kill 10 million people—more than one and a half times the population of Maryland,” said Maryland U.S. Attorney Robert K. Hur. “We are working with our partners to attack the sources of supply, as well as the street dealers who are committing the most violence in our neighborhoods.”
According to the indictment and other court documents, the defendants are allegedly high-ranking members of a Baltimore-based drug trafficking organization that imports and distributes heroin, fentanyl, and other drugs in the Baltimore metropolitan area. The defendants allegedly obtained drugs from a Miami-based drug trafficking organization with ties to the Sinaloa and Tijuana Mexican drug cartels. The Department of Justice has declared the Sinaloa drug cartel as one of its top five priority transnational organized crime targets. The cartel uses drug trafficking and other criminal activities to obtain power, influence, and money, while protecting its activities through a pattern of violence and corruption. To combat this threat, the Department of Justice has formed a Transnational Organized Crime Task Force to coordinate and optimize the Department’s efforts to dismantle this group and other priority targets..
Beginning in the Fall of 2017, the defendants regularly met with a courier from Miami to deliver large sums of cash. In exchange for the money, the Miami-based drug trafficking organization would arrange for kilogram-quantities of narcotics to be delivered to the defendants. According to court documents, the narcotics would be delivered by the cartel to a contact in Ventura County, California, and then shipped to Maryland for delivery to the defendants.
To date, law enforcement has seized 20 kilograms of fentanyl and over $500,000 in U.S. currency.
If convicted, the defendants each face a mandatory minimum sentence of 10 years in federal prison and a maximum sentence of life imprisonment. Defendants Elijah and Mobley previously had their initial appearances in U.S. District Court in Baltimore and are detained pending trial.
An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.
United States Attorney Robert K. Hur commended the DEA, the Baltimore Police Department, the Baltimore City Sheriff’s Office, the Baltimore County Police Department; and HSI-Baltimore for their work in the investigation. Mr. Hur thanked Assistant U.S. Attorneys John W. Sippel, Jr. and Lauren E. Perry, who are prosecuting this Organized Crime Drug Enforcement Task Force case.
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Three Defendants Plead Guilty on Eve of Drug Trafficking TrialRead the Press Release
PHILADELPHIA -- United States Attorney William M. McSwain announced today that three participants in a drug trafficking ring operating primarily in the City of Chester, pleaded guilty to drug trafficking offenses. Co-conspirators David Toney, James Townsend, and Cheron Jackson were scheduled to begin trial on Monday, November 5, 2018, before United States District Court Judge Mitchell S. Goldberg.
From approximately January through December 2015, James Townsend was a leader of a drug trafficking group in the City of Chester. He supplied bulk quantities of cocaine to other lower level cocaine distributors in the area. Townsend, in turn, was supplied by David Toney – a kilogram-level drug trafficker who primarily operated out of a residence he owned in West Philadelphia.
At the conclusion of a year-long investigation, law enforcement executed search warrants on the defendants’ residences in Philadelphia, Chester, and Delaware. Law enforcement seized approximately two kilograms of cocaine, over $80,000 in cash, five firearms, hundreds of rounds of ammunition, and paraphernalia and equipment used for drug trafficking. Seized paraphernalia included digital scales, new and unused packaging, and a cocaine press used to re-process kilograms of cocaine.
David Toney pleaded guilty to conspiracy to distribute 500 grams or more of cocaine and possession of firearms and ammunition in furtherance of drug trafficking. He awaits sentencing.
Townsend pleaded guilty to conspiracy to distribute 5 kilograms or more of cocaine; distribution of cocaine; possession with the intent to distribute, and aiding and abetting the possession with the intent to distribute, 500 grams or more of cocaine; and possession with the intent to distribute, and aiding and abetting the possession with the intent to distribute, 500 grams or more of cocaine within 1000 feet of the Ruth L. Bennett Homes, a public housing facility in Chester. He is scheduled to be sentenced in February 2019.
Jackson pleaded guilty to conspiracy to distribute 500 grams or more of cocaine; possession with the intent to distribute, and aiding and abetting the possession with the intent to distribute, 500 grams or more of cocaine; and possession with the intent to distribute, and aiding and abetting the possession with the intent to distribute, 500 grams or more of cocaine within 1000 feet of the Ruth L. Bennett Homes, a public housing facility in Chester. Jackson awaits sentencing.
“Those who supply and sell deadly drugs in the Eastern District will learn the hard way that they will be prosecuted,” said U.S. Attorney McSwain. “These defendants now face substantial prison time for their crimes and will be held accountable for the misery they caused. Thanks to the excellent work of our local and state law enforcement partners, we were able to detect and disrupt this deadly drug trafficking organization.”
“Every day, members of our Criminal Investigation Division stand shoulder-to-shoulder with our federal, state, and local law enforcement partners to root out dangerous drug trafficking organizations like the one these criminals operated,” said Delaware County District Attorney Katayoun M. Copeland. “We are pleased that our ongoing efforts continue to make our community safe.”
“Cooperation between local, state, and federal law enforcement partners was instrumental in bringing these dangerous criminals to justice and making southeastern Pennsylvania safer,” said Lieutenant Colonel Robert Evanchick, Acting Pennsylvania State Police Commissioner. “I applaud all of the investigators who worked tirelessly for twelve months to build a strong case, including overwhelming evidence against the accused, which led to today's guilty pleas.”
“The Chester Police Department is grateful for the efforts of the U.S. Attorney’s Office in securing this conviction and tying up the last loose end of this investigation,” said James Nolan, Chief of Police, City of Chester. “Following the efforts of the Chester Police Narcotics Division, Pennsylvania State Police, the Pennsylvania Office of the Attorney General, and the Delaware County District Attorney, a plea agreement is an outcome we are pleased with. This was a large step in offering relief to those citizens that suffer at the hands of illegal drug trafficking and the collateral damage caused by it.”
The case was investigated by the Federal Bureau of Investigation, Pennsylvania Office of the Attorney General, Pennsylvania State Police, City of Chester Police Department, and the Delaware County District Attorney’s Office–Criminal Investigation Division. The case is being prosecuted by Assistant United States Attorneys A. Nicole Phillips and Yvonne O. Osirim.
Tax preparers sentenced to federal prison for conspiring to defraud the government of more than $3.8 millionRead the Press Release
ATLANTA - Joseph Racine and Arnouse Merlien were sentenced to federal prison for conspiracy to violate the federal income tax laws by purposely misrepresenting to the IRS that their clients were qualified to receive certain tax credits and deductions on their federal tax returns. Racine was the owner of JSR Westend Tax Services, located in Atlanta, Georgia and JSR Tax Services, located in Greenacres, Florida. Merlien was the office manager of JSR Tax Services in Florida.
“These defendants defrauded the U.S. government out of more than $3.8 million by falsely claiming tax credits and expenses on tax returns prepared for clients,” said U.S. Attorney Byung J. “BJay” Pak. “Tax preparers who devise schemes to cheat the IRS can look forward to spending tax seasons behind bars.”
“Racine and Merlien lined their pockets by manipulating taxpayers’ returns for the sole purpose of generating large refunds and fees,” said Thomas J. Holloman, Special Agent in Charge, IRS-Criminal Investigation. “This is an important reminder that if you file false tax returns for others, we will find out and you will face the consequences.”
According to U.S. Attorney Pak, the charges and other information presented in court: In December 2016, Internal Revenue Service - Criminal Investigation (IRS-CI) identified JSR Westend Tax Services as potentially filing fraudulent returns for tax years 2013 through 2015. The investigation revealed that Racine was filing fraudulent returns involving multiple credits and deductions, including the fuel tax credit, refundable education credit, and unreimbursed employee business expenses. Racine requested refunds on 99 percent of the returns, a rate significantly higher than the average over the same years. In March 2017, IRS-CI determined that JSR Tax Services in Florida, where Merlien primarily worked, was filing federal tax returns displaying the same patterns of fraud as those prepared at JSR Westend Tax Services in Atlanta.
The investigation revealed that Racine and Merlien engaged in this scheme to increase the amount of money they could charge their clients for preparing their returns. The investigation further revealed that the fraud perpetrated by Racine and Merlien resulted in losses to the U.S. Government in excess of $3.8 million.
Joseph Racine, 38, of Boynton Beach, Florida, was sentenced by U.S. District Judge Leigh Martin May to three years, four months in federal prison, to be followed by three years of supervised release.
Arnouse Merlien, 40, also of Boynton Beach, Florida, was sentenced to three years, in federal prison, to be followed by three years of supervised release. Both defendants were ordered to pay $3,854,915 in restitution to the Internal Revenue Service.
This case was investigated by the Internal Revenue Service Criminal Investigation Division.
Assistant U.S. Attorney Michael Herskowitz, Deputy Chief of the Organized Crime and Gang Section, prosecuted the case.
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.
Statement of United States Attorneys Matthew Schneider and Andrew Birge Regarding the Passage of Proposal OneRead the Press Release
The people of Michigan have voted to legalize – with certain restrictions – the possession, use, and distribution of marijuana under state law. However, marijuana continues to be an illegal drug under federal law. As the chief federal law enforcement officers in Michigan, we are providing this statement regarding the enforcement of federal marijuana laws in light of the passage of Proposal One.
Because we have taken oaths to protect and defend the Constitution and the laws of the United States, we will not unilaterally immunize anyone from prosecution for violating federal laws simply because of the passage of Proposal One.
We will continue to approach the investigation and prosecution of marijuana crimes as we do with any other crime. We will consider the federal law enforcement priorities set by the United States Department of Justice, the seriousness of the crime, the deterrent effect of prosecution, and the cumulative impact of the crime on a community. As we weigh the interests in enforcing a law, we must also consider our ability to prosecute with our limited resources.
Combating illegal drugs is just one of our many priorities. We are also focused on preventing and prosecuting terrorism, violent crime, gangs, corruption, and fraud. Even within the area of drugs, we are increasingly focused on combating the opioid epidemic, which is killing our citizens at an alarming rate.
Our offices have never focused on the prosecution of marijuana users or low-level offenders, unless aggravating factors are present. That will not change. Nevertheless, crimes involving marijuana can pose serious risks and harm to a community. The seriousness of the offense and impact on a community includes a broad range of related activity and concerns for federal law enforcement. These concerns include, for example: adverse effects of interstate trafficking of marijuana; the involvement of other illegal drugs or illegal activity; persons with criminal records; the presence of firearms or violence; criminal enterprises, gangs, and cartels; the bypassing of local laws and regulations; the potential for environmental contamination; and the risks to minors. We, of course, also have an interest in preventing the cultivation, use and distribution of marijuana on federal property.
These are just examples, and this statement does not limit our discretion to enforce the law. We will continue to work closely with our federal, state, local, and tribal law enforcement partners to assess the federal law enforcement interest for every case as it comes in. When we act, we will act in the interests of public health and safety.
Statement of United States Attorneys Matthew Schneider and Andrew Birge Regarding the Passage of Proposal OneRead the Press Release
The people of Michigan have voted to legalize – with certain restrictions – the possession, use, and distribution of marijuana under state law. However, marijuana continues to be an illegal drug under federal law. As the chief federal law enforcement officers in Michigan, we are providing this statement regarding the enforcement of federal marijuana laws in light of the passage of Proposal One.
Because we have taken oaths to protect and defend the Constitution and the laws of the United States, we will not unilaterally immunize anyone from prosecution for violating federal laws simply because of the passage of Proposal One.
We will continue to approach the investigation and prosecution of marijuana crimes as we do with any other crime. We will consider the federal law enforcement priorities set by the United States Department of Justice, the seriousness of the crime, the deterrent effect of prosecution, and the cumulative impact of the crime on a community. As we weigh the interests in enforcing a law, we must also consider our ability to prosecute with our limited resources.
Combating illegal drugs is just one of our many priorities. We are also focused on preventing and prosecuting terrorism, violent crime, gangs, corruption, and fraud. Even within the area of drugs, we are increasingly focused on combating the opioid epidemic, which is killing our citizens at an alarming rate.
Our offices have never focused on the prosecution of marijuana users or low-level offenders, unless aggravating factors are present. That will not change. Nevertheless, crimes involving marijuana can pose serious risks and harm to a community. The seriousness of the offense and impact on a community includes a broad range of related activity and concerns for federal law enforcement. These concerns include, for example: adverse effects of interstate trafficking of marijuana; the involvement of other illegal drugs or illegal activity; persons with criminal records; the presence of firearms or violence; criminal enterprises, gangs, and cartels; the bypassing of local laws and regulations; the potential for environmental contamination; and the risks to minors. We, of course, also have an interest in preventing the cultivation, use and distribution of marijuana on federal property.
These are just examples, and this statement does not limit our discretion to enforce the law. We will continue to work closely with our federal, state, local, and tribal law enforcement partners to assess the federal law enforcement interest for every case as it comes in. When we act, we will act in the interests of public health and safety.
END
St. Lucie County Felon Convicted at Trial of Aiding and Abetting False Statements to Unlawfully Purchase a FirearmRead the Press Release
Anthony Joseph Safiotti, 35, of St. Lucie County, was convicted by a federal jury yesterday of aiding and abetting false statements to unlawfully purchase a firearm, in violation of Title 18, United States Code, Sections 922(a)(6) and 2.
Ariana Fajardo Orshan, U.S. Attorney for the Southern District of Florida and Ari C. Shapira, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Miami Field Office made the announcement.
According to the court docket, including evidence introduced at trial, Safiotti, a convicted felon, convinced a young pregnant drug addict, to be a straw buyer of a firearm in exchange for opioids. On February 2, 2018, Safiotti and the straw buyer entered a pawn shop in Martin County. The straw buyer purchased a semi-automatic firearm, gun case, ammunition, and an extra 40 round magazine for Safiotti. Following Safiotti’s directives, the straw buyer falsely completed the ATF Form 4473 paperwork, as the actual/true buyer of the firearm and ammunition.
Safiotti had previously been convicted of several felony offenses and was prohibited from possessing a firearm or ammunition.
Safiotti is scheduled to be sentenced by U.S. District Judge Donald M. Middlebrooks on January 17, 2019 at 10:00 a.m.
This case stems from Project Safe Neighborhoods (PSN), a program that brings together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The PSN program was reinvigorated in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
U.S. Attorney Fajardo Orshan commended the investigatory efforts of the ATF in this matter. This case was prosecuted by Assistant United States Attorney Carmen Lineberger.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Six Philadelphia Women Sentenced for Fraudulent Tax Refund SchemeRead the Press Release
PHILADELPHIA – First Assistant United States Attorney Jennifer Arbittier Williams announced today that six Philadelphia women, several of whom are sisters and cousins, have been sentenced to prison and ordered to pay restitution for their role in a scheme to defraud the United States through the filing of false claims for tax refunds.
The six defendants all pleaded guilty and admitted to engaging in a scheme to present false federal income tax returns to the Internal Revenue Service (IRS), in order to to generate fraudulent federal income tax refunds. Dozens of false tax returns were filed with the IRS, often using names and social security numbers stolen from individuals who were unaware their personal identifiers were being used to perpetrate the fraud.
Defendant Larayna Dunson, the mastermind behind this tax refund scheme, recruited family members, friends, and social acquaintances to participate. Initially, the defendants provided taxpayer’s information (i.e., names and social security numbers) to Dunson, who in turn fabricated multiple federal income tax returns. The defendants then shared the fraudulent refunds obtained. Dunson subsequently taught the co-defendants how to prepare false returns using the stolen identity information. Her co-defendants then began filing fraudulent tax returns and obtaining false refunds themselves. The total amount of fraudulent income tax refunds obtained and deposited into accounts controlled by the defendants exceeded $600,000. The defendants used these stolen funds for living expenses, including rent and cars.
In addition to sentencing each defendant to a term of imprisonment, Judge Brody ordered the defendants to pay restitution in the total amount of $1,007,080.
“Tax fraudsters wreak havoc on the victims whose identities they steal and on the efficient operation of the IRS,” said First Assistant United States Attorney Jennifer Arbittier Williams. “The government loses millions of dollars of revenue each year because of criminals looking for ways to cheat the tax system, and we will continue to hold them accountable for their crimes.”
“These defendants perpetuated an elaborate scheme driven by insatiable greed and a blatant disregard for the tremendous damage inflicted on innocent victims,” said IRS Criminal Investigation Special Agent in Charge Guy Ficco. Be assured that IRS Criminal Investigation is serious about investigating these crimes and holding to account those who prey on innocent victims and defraud the government.”
The case was investigated by Internal Revenue Service-Criminal Investigation and is being prosecuted by Assistant United States Attorney Denise S. Wolf.
Sentencings for November 1 - November 5, 2018Read the Press Release
Chief Federal District Court Judge Scott W. Skavdahl sentenced WILLIAM TYLER MIDGETT, 32, of Evansville, Wyoming on November 1, 2018 for being a felon and unlawful user of controlled substance in possession of a firearm and possession of firearm not registered in the national firearms registration and transfer record. Midgett was arrested in Casper, Wyoming. He received thirty-seven months of imprisonment, to be followed by thirty-six months of supervised release, on each count, to be served concurrently. The Casper Police Department and the U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives investigated this case.
Chief Federal District Court Judge Scott W. Skavdahl sentenced JERRY JOSEPH ROMERO, 42, of Salt Lake City, Utah on November 5, 2018 for being a felon in possession of a firearm and carrying a firearm during and in relation to a drug trafficking crime. Romero was arrested in Sweetwater County, Wyoming. He received a total of ninety-three months of imprisonment, to be followed by thirty-six months of supervised release, and ordered to pay a $200.00 special assessment. The U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives investigated this case.
Chief Federal District Court Judge Scott W. Skavdahl sentenced LOVELESS DANIEL NAYLOR, 40, of South Bend, Indiana on November 5, 2018 for possession with intent to distribute heroin. Naylor was arrested in Cheyenne, Wyoming. He received fifty-seven months of imprisonment, to be followed by forty-eight months of supervised release, and ordered to pay restitution in the amount of $500.00 and a $100.00 special assessment. The Wyoming Division of Criminal Investigation investigated this case.
Federal District Court Judge Alan B. Johnson sentenced GUILLERMO MALDONADO-ABARCA, 34, of Denver, Colorado on November 2, 2018 for illegal re-entry of a previously deported alien into the United States. Maldonado-Abarca was arrested in Casper, Wyoming. He received time served plus ten days to allow for deportation proceedings, twelve months of supervised release, and ordered to pay a $100.00 special assessment. The U.S. Department of Homeland Security Investigations investigated this case.
Second Federal Conviction for Possessing a Gun and Drugs Nets Cedar Rapids Felon over Thirty Years in Federal PrisonRead the Press Release
A man who tossed a loaded semi-automatic pistol and a bag of marijuana into a wooded area near the I-380 and Glass Road interchange in Cedar Rapids after a car accident in July 2017 was sentenced November 7, 2018, to more than 33 years in federal prison.
David Tachay Heard, age 40, from Cedar Rapids, Iowa, received the prison term after a January 24, 2018, jury verdict finding him guilty of possession of a firearm by a felon, possession of a stolen firearm, possession of marijuana with intent to deliver, and possession of a firearm in furtherance of a drug trafficking crime.
Evidence at trial showed that on July 30, 2017, Heard ran a red light and crashed into another car at the Glass Road and I-380 interchange. Heard drove his car to a more secluded spot on Redbud Road and tossed a bag of marijuana and a gun into the nearby brush. Someone driving by in a car saw him do so and called 911. The evidence at trial also showed that after Heard was arrested, the witness received calls from a girlfriend of an associate of Heard, telling the witness that Heard had his name and address.
Heard’s cousin purchased the gun that Heard possessed in 2013. Heard’s cousin testified at trial that he did not give Heard permission to have the gun, because he knew Heard was a felon.
In 2000, Heard was convicted in federal court in Cedar Rapids of possessing a gun in furtherance of a drug trafficking crime and possession with intent to distribute marijuana. He was sentenced to more than ten years in prison. While in federal prison in 2005, Heard was convicted of possessing a weapon in the prison.
Heard was sentenced in Cedar Rapids by United States District Court Judge Linda R. Reade. Heard was sentenced to 397 months’ imprisonment. He must also serve a five-year term of supervised release after the prison term. There is no parole in the federal system.
Heard is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorneys Tim Vavricek and Lyndie Freeman and investigated by Federal Bureau of Investigation, the Cedar Rapids Police Department, and the Bureau of Alcohol, Tobacco, and Firearms.
This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. In October 2017, as part of a series of actions to address the tide of rising violent crime in America, the Department of Justice announced the reinvigoration of PSN and directed all U.S. Attorney’s Offices to develop a district crime reduction strategy that incorporates the lessons learned since PSN launched in 2001.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 17-CR-83-LRR.
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Sapulpa Man Sentenced for Producing Child Pornography via Text MessagingRead the Press Release
TULSA, Okla. – A 32-year-old man has been ordered to federal prison following his conviction of one count of sexual exploitation of a child, announced U.S. Attorney Trent Shores. Justin Lee Boyer pleaded guilty Aug. 6, 2018.
Today, U.S. District Judge Claire V. Eagan sentenced Boyer to 25 years in prison. Boyer will also serve 10 years on supervised release following completion of his prison term, during which time he will have to comply with numerous requirements designed to restrict his access to children and the internet. Boyer will also be ordered to register as a sex offender.
“Boyer used technology to sexually exploit a young girl for his perverse sexual gratification. Federal agents and prosecutors are ever vigilant in their efforts to protect our children online,” said U.S. Attorney Shores. “Project Safe Childhood is a priority for this office.”
At the time of his plea, Boyer admitted he engaged in text messaging and used Skype to communicate with a 10-year-old girl who resided in another state. As a result of those conversations, the young girl produced visual depictions of sexually-explicit conduct and sent them to Boyer using her cell phone.
Boyer has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The FBI, Jefferson County, Colorado, Sheriff’s Office, Creek County Sheriff’s Office and the Sapulpa Police Department conducted the investigation. Assistant U.S. Attorneys Jeffrey A. Gallant and Shannon Cozzoni prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorney’s Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
San Antonio Man Admits to Stealing Approximately $479K from Multiple BanksRead the Press Release
In San Antonio today, 42-year-old Dennis Edward Stephen, pleaded guilty in federal court to robbing multiple San Antonio banks and stealing approximately $479,000, announced U.S. Attorney John F. Bash, F.B.I. Special Agent in Charge Christopher Combs, San Antonio Division, and San Antonio Police Chief William McManus.
Appearing before U.S. Magistrate Judge Henry Bemporad, Stephen pleaded guilty to one count of bank robbery. By pleading guilty, Stephen admitted responsibility for eight different bank robberies in San Antonio and the surrounding area between November 14, 2013, and July 23, 2018. The robberies include:
- November 14, 2013; April 17, 2014; and September 19, 2014 – Frost Bank on Vance Jackson Rd. – approximately $37,604; $36,280; and $133,000 stolen, respectively;
- November 24, 2015 – Broadway Bank in Helotes, TX – approximately $11,323 stolen;
- June 16, 2016 – Frost Bank on Wurzbach Rd. – approximately $56,077 stolen;
- November 4, 2016; July 5, 2017; and July 23, 2018 – Frost Bank on N. Loop 1604 – approximately $67,000; $101,000; and $36,561 stolen, respectively.
According to court records, authorities dubbed Stephen the “Camry Cruzin’ Bandit” because he drove a Toyota Camry during his scheme and often wore the same attire while committing the robberies: blue jeans, a denim long sleeve button down shirt, a white t-shirt and a UTSA Roadrunners baseball cap covering his head, sunglasses and a surgical mask covering his face, and rubber surgical gloves covering his hands.
Authorities arrested Stephen on July 23, 2018, following the Frost Bank robbery. He has since remained in federal custody. Stephen faces up to 20 years in federal prison and restitution to the financial institutions. Sentencing is scheduled for 1:30pm on March 6, 2019, before U.S. District Judge Xavier Rodriguez in San Antonio.
The F.B.I. together with the San Antonio Police Department investigated this case. Assistant U.S. Attorney Sarah Wannarka is prosecuting this case on behalf of the Government.
Richland-Based Research Laboratory and Its Owner Indicted for Allegedly Falsifying Opioid Addiction Drug Research TrialsRead the Press Release
Spokane – Today, Joseph H. Harrington, United States Attorney for the Eastern District of Washington, announced the unsealing of a 47-count Federal Indictment against two Richland, Washington based companies, Mid Columbia Research LLC and Zain Research LLC, and their owner, Sami Anwar. The Indictment charges the defendants with conspiracy to commit wire and mail fraud, fraudulently obtaining controlled substances, and furnishing false information to the U.S. Drug Enforcement Administration (DEA). The Indictment also seeks the forfeiture of at least $274,642.80 representing the proceeds of the alleged fraud.
The Indictment charges that between July 2016 and January 2018, the defendants fraudulently conducted and falsified a drug trial designed to study an experimental alternative treatment for daily opioid users who suffered from chronic pain. The Indictment charges that the defendants enrolled ineligible study subjects and forged physician signatures and falsified medical records and other documentation designed to make it appear as though a licensed physician had determined that the subjects were eligible for the study. The Indictment further charges that the defendants falsified records and study data designed to make it appear as though subjects were participating in the study and were receiving the experimental treatment when they were not, in order to falsely bill for the study and obtain over a quarter of a million dollars from the drug company that was sponsoring the study. The Indictment charges that the defendants created false and fraudulent documentation to hide the fraud from the sponsor, monitors, and federal regulators. The Indictment also charges that the defendants fraudulently obtained controlled substances, including the narcotic opioids hydrocodone/acetaminophen (which is commonly sold as Vicodin) and morphine, by falsely representing that these drugs would be and were being used for legitimate research purposes when they were not. Finally, the Indictment charges that the defendants submitted a false and fraudulent application to the DEA in a failed attempt to obtain
Gamma Hydroxybutyrate (commonly known as “GHB” or the “date rape drug”) for a separate sleep disorder study that the defendants also hoped to obtain funding for.
United States Attorney Harrington said “Investigating fraud and opioid-related crimes is a top priority for the Department of Justice. The United States Attorney’s Office for the Eastern District of Washington will continue to use all of the investigative and legal tools available to us to do so.”
DEA Special Agent in Charge of the Pacific Northwest Region Keith Weis was extremely pleased with today’s announcement, stating that “Conducting legitimate research is the foundation in which modern medicine is built on. To exploit that under the false premise of conducting lifesaving research to aid those who suffer opioid dependency is appalling, illegal, and criminal.” Weis further added that, “This investigative action in Eastern Washington is part of a continuing state wide strategy addressing illicit opioid access and diversion currently endangering our communities.”
The conspiracy, mail, and wire fraud charges against Defendant Sami Anwar each carry a maximum penalty of a 20-year term of imprisonment; a $250,000 fine, or double the gross gain or gross loss, whichever is greater; a 3-year term of court supervision; and restitution. Following the grand jury’s return of the Indictment, United States Magistrate Judge Mary K. Dimke issued a warrant for the seizure of over $175,000 from one of Mr. Anwar’s bank accounts constituting some of the proceeds of the alleged fraud.
An Indictment is merely an allegation 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.
This investigation was conducted by the U.S. Drug Enforcement Administration. This case is being prosecuted by Dan Fruchter and Tyler H.L. Tornabene, Assistant United States Attorneys for the Eastern District of Washington.
Reno Man Convicted in Methamphetamine Trafficking ConspiracyRead the Press Release
RENO, Nev. – A jury convicted a Reno resident in connection to a drug trafficking conspiracy to distribute methamphetamine in the Reno and Sparks area, announced U.S. Attorney Dayle Elieson for the District of Nevada.
After a three-day trial, a jury convicted Edward Smith, aka “Smitty,” 53, of conspiracy to possess and distribute at least 50 grams of methamphetamine, illegal use of a communication facility, money laundering, distribution of at least 50 grams of methamphetamine, and distribution of at least five grams of methamphetamine.
As evidence elicited at trial revealed, Smith, an inmate at the Northern Nevada Correctional Center, arranged for his niece's ex-boyfriend, whom he referred to as his “nephew,” to sell methamphetamine to another inmate’s associate in the Reno community at a premium price. Specifically, in recorded prison calls from June 1, 2015, to July 24, 2015, Smith counseled his nephew about how to conduct the drug transactions with the associate. In these calls, he also told his nephew to send him a “whole one,” referencing an ounce of methamphetamine, “each time [the associate] comes.” His nephew distributed methamphetamine to the associate in Sparks, Nevada, with the last sale involving a pound of methamphetamine for $7,000. In subsequent calls, Smith discussed how to get methamphetamine to him in the prison and arranged a $1,500 wire transfer in another person’s name in order to facilitate that deal.
United States District Judge Howard D. McKibben scheduled a sentencing hearing for February 6, 2019. At the time of sentencing, Smith faces a minimum of 10 years in prison and a maximum of life imprisonment.
The Drug Enforcement Administration, with the assistance of the Nevada Department of Corrections, and the Washoe County Sheriff’s Office, investigated the case. Assistant U.S. Attorney James Keller is prosecuting the case.
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Real Estate Developer Pleads Guilty in Manhattan Federal Court to Defrauding Investors Out of $58 Million in Years-Long Real Estate Investment SchemeRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that MICHAEL D’ALESSIO pled guilty today to operating a years-long scheme to defraud investors in his luxury real estate development projects in Manhattan, the Hamptons, Westchester, and elsewhere, and to making false claims and concealing assets in connection with his bankruptcy case. D’ALESSIO pled guilty before U.S. District Judge Jesse M. Furman.
Manhattan U.S. Attorney Geoffrey S. Berman said: “Real estate developer Michael D’Alessio admitted today to misappropriating investor funds intended for specific luxury development projects by funneling them into shell accounts he controlled. In typical Ponzi-like fashion, D’Alessio comingled over $58 million of investor funds and used them to cash out early investors, cover debts, and pay his own personal gambling debts. When D’Alessio eventually went into bankruptcy, he perpetrated yet another fraud by trying to conceal assets. Today this fraudster has taken responsibility for his actions and faces time in a considerably less luxurious property – federal prison.”
According to the Indictment, Superseding Information, and statements made in court:
MICHAEL D’ALESSIO, a real estate developer and general contractor, served as the president and chief executive officer of a real estate investment and development firm specializing in the design, construction, and management of both residential and commercial real estate properties (“Company-1”). D’ALESSIO and Company-1 developed, and purported to develop, luxury residential real estate properties in Manhattan, the Hamptons, Westchester, and elsewhere.
D’ALESSIO typically followed the same pattern in each real estate investment project: he sought investments by offering for sale shares in a newly formed limited liability company (“LLC”) named after the location of the parcel of real estate to be developed and sold (the “Target Property”). In exchange for a purchase of shares in the LLC, D’ALESSIO promised a guaranteed monthly interest payment and a share in the profits from the sale of the Target Property. In soliciting investors, D’ALESSIO made numerous representations to potential investors, including that investor funds would be used only to develop the relevant Target Property and to cover related business expenses of the relevant LLC.
However, in reality, from at least in or about 2015 through in or about April 2018, D’ALESSIO misappropriated investor funds for his own use and benefit, and made other material misrepresentations. Upon receiving investor funds, D’ALESSIO typically channeled those funds through a series of bank accounts held in the name of shell companies owned and controlled by D’ALESSIO. D’ALESSIO then used much of those investor funds for his own benefit, including to pay off debts and prior investors, and to fund significant gambling and other personal expenses. D’ALESSIO took steps to conceal his fraud, including deceiving investors regarding the progress of various real estate projects and using money raised from investors to make monthly payments to investors in different projects in the manner of a Ponzi scheme. D’ALESSIO defrauded investors out of approximately $58 million.
In 2018, D’ALESSIO went into involuntary bankruptcy under Chapter 7 of Title 11 of the United States Code. In connection with this bankruptcy proceeding, captioned In re Michael D’Alessio, No. 18-22552 (Bankr. S.D.N.Y.), D’ALESSIO submitted forms that fraudulently omitted money and property belonging to his estate, and made a false declaration under penalty of perjury concerning his money and property.
* * *
D’ALESSIO, 53, of New York, New York, pled guilty to one count of committing wire fraud, which carries a maximum sentence of 20 years in prison and a maximum fine of $250,000 or twice the gross gain or loss from the offense; and one count of concealing assets from a bankruptcy court, which carries a maximum sentence of five years in prison and a maximum fine of $250,000 or twice the gross gain or loss from the offense. Sentencing is scheduled for March 22, 2019, at 10:00a.m.
The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentence for the defendant will be determined by the judge.
Mr. Berman praised the investigative work of the Federal Bureau of Investigation.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Amanda Kramer and Daniel G. Nessim are in charge of the prosecution.
Prolific Anchorage Car Thief Sentenced to 78 Months in PrisonRead the Press Release
Anchorage, Alaska – U.S. Attorney Bryan Schroder announced that Steven Michael Lee McComas, age 21, of Anchorage, was sentenced yesterday by Chief U.S. District Judge Timothy M. Burgess, to serve a combined sentence of 78 months in federal prison and three years of supervised release. In July 2018, McComas pleaded guilty to being a felon in possession of a firearm, and conspiracy to commit robbery affecting interstate commerce.
According to court documents, on Feb. 9, 2018, at 3:45 a.m., a pizza delivery driver in Fairbanks was robbed at gunpoint by several individuals. The investigation revealed that McComas’ cellular telephone was used to order a pizza to a location in Fairbanks. When the driver arrived at the location, she was approached by two individuals armed with firearms. They pointed the firearms at the driver and took $130 and a cellular telephone. A vehicle then pulled up and the two individuals got inside and drove away. McComas knew his phone was used to call the pizza delivery driver to the location in Fairbanks, and knew that his two co-conspirators were armed with firearms when they robbed the delivery driver. McComas was also present in the vehicle that drove the two individuals away from the scene.
On Feb. 10, 2018, at 1:40 a.m., another pizza delivery driver in Anchorage was robbed at gunpoint by several individuals wearing masks and winter hats. They took his cellular telephone, $80, his shoes, and his vehicle, a 2007 Dodge Nitro. Later that morning, Anchorage Police saw the stolen vehicle near Elmore Road and Martin Luther King, Jr. Ave. APD attempted to stop the vehicle but the driver accelerated and drove evasively, to include running a red light. Officers eventually stopped the vehicle and McComas was identified as the driver. He was in possession of a Kel-Tec Sub-2000 9mm semiautomatic rifle loaded with 25 rounds of ammunition. Inside the vehicle was a spent 9mm shell casing, black gloves and a white ski mask.
McComas is prohibited from possession of firearms due to his prior felony conviction for Vehicle Theft in the First Degree. McComas has three prior adult vehicle theft related convictions, and has been charged as an adult with two other vehicle thefts that were dismissed or not prosecuted by the State of Alaska.
Before imposing a sentence, Judge Burgess noted that this was a very serious offense and dangerous conduct. He acknowledged the fear the delivery drivers must have felt when they were confronted by multiple individuals pointing firearms at them. Judge Burgess was particularly concerned about the escalating dangerous behavior shown by McComas, and how he had “graduated” from stealing vehicles to becoming involved in robberies and in possession of firearms.
The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the Anchorage Police Department, and the Fairbanks Police Department conducted the investigation leading to the successful prosecution of this case. This case was prosecuted by Assistant U.S. Attorney Kelly Cavanaugh.
Port Graham Man Sentenced for Crimes Related to False Distress Call that Caused a Needless Search and Rescue OperationRead the Press Release
Anchorage, Alaska – U.S. Attorney Bryan Schroder announced that a Port Graham resident has been sentenced to federal prison for causing the U.S. Coast Guard to attempt to save life and property when no help was needed, thereby causing unnecessary expenditure of vital lifesaving resources.
Ryan Riley Meganack, aka: “Unga,” 35, of Port Graham, Alaska, was sentenced today by U.S. District Judge Sharon L. Gleason to serve 2.5 years in prison, with 15 months to be served consecutively to his 25 year (10 years suspended) state prison sentence in State of Alaska v. Meganack, 3AN-15-00683CR, following his guilty pleas to one count of false distress and one count of felon in possession of a firearm. Meganack was also ordered to pay $384,261.50 in restitution to the U.S. Coast Guard.
Meganack, a long-time commercial fisherman and a boat captain, was scheduled to plead guilty to sexual assault of an incapacitated woman in December 2016, in a separate case (State of Alaska v. Meganack, 3AN-15-00683CR). Meganack was a second time sex offender and faced many years in prison for that crime. To avoid prison, Meganack hatched a plan to fake his own death, which involved him causing a false report of distress to the U.S. Coast Guard. Meganack planned to flee Alaska when the search for him proved unsuccessful and was suspended. Meganack manipulated his younger girlfriend and co-defendant, Ivy Rose Rodriguez, now age 28, into helping him carry off the hoax to flee Alaska when the search for him proved unsuccessful.
The investigation revealed that, on Nov. 29, 2016, Meganack piloted his fishing vessel to an island near Port Graham bay alone, with his seiner skiff in tow. Meganack staged his skiff on the rocks, “swamped” it, and made it appear that he had gone missing after a boating accident or had otherwise died. Meganack then returned to Port Graham harbor, picked up Rodriguez, and traveled up Port Graham Bay, where they secured Meganack’s fishing vessel in a slough. Meganack and Rodriguez returned to Port Graham on foot. Rodriguez returned to Meganack’s mother’s residence, while Meganack went to the makeshift campsite he had previously set up, stocked with supplies, located in the woods near his mother’s residence.
In the early morning hours of Nov. 30, 2016, Rodriguez – per Meganack’s instructions – reported to Meganack’s mother that: (1) she and Meganack had fought the night before; (2) Meganack had left in his skiff; (3) he was drunk; and (4) the skiff was not working well. Between Nov. 30, 2016, and Dec. 2, 2016, Meganack and Rodriguez caused a search and rescue operation to be launched for Meganack. The weather conditions during the search were poor, with snow, high winds, and low visibility at times in the Port Graham area. Meganack was, in actuality, safe in his makeshift camp that he made for carrying out their plan.
Federal, state, and local authorities, as well Port Graham and Nanwalek residents, participated in the search for Meganack. Helicopters from U.S. Coast Guard Air Station Kodiak, Coast Guard Cutter Naushon, and Coast Guard command center personnel participated in the operation. The Coast Guard alone expended approximately $384,261.50 in resources during the search for Meganack. When searchers found Meganack’s skiff, the motor was down, its throttle was forward, the key was in the “on” position, and inside was a single rubber boot and an empty bottle of liquor.
During the course of the investigation, Rodriguez cooperated and told authorities where Meganack was located and that he was armed. Meganack was later found at his makeshift camp, and in possession of a loaded semiautomatic rifle. Meganack had previously been convicted of two felony offenses, and was therefore prohibited from possessing a firearm.
In sentencing Meganack, Judge Gleason underscored the seriousness of Meganack’s false distress offense, which she recognized had “an enormous impact” on the Coast Guard and the Port Graham community and “put so many at risk” needlessly. The judge emphasized the need to send a message that those who make false distress calls to the U.S. Coast Guard will face criminal penalties.
The Coast Guard Investigative Service (CGIS) and the Alaska State Troopers (AST) conducted the investigation leading to the successful prosecution of this case. This case was prosecuted by Assistant U.S. Attorney Andrea W. Hattan.
Poplar couple sentenced in assault for driving vehicle into group of pedestriansRead the Press Release
GREAT FALLS—A Poplar couple who admitted assault charges for driving a vehicle into a group of pedestrians, seriously injuring one, in a drug debt dispute were sentenced to years in federal prison this week, the U.S. Attorney’s Office announced.
U.S. District Judge Brian M. Morris sentenced Ashley Nicole Vondall, 26, on Wednesday to 40 months in prison and three years of supervised release. Morris sentenced co-defendant Jonathan Damstrom Cantrell, 33, on Thursday to 38 months in prison and three years of supervised release.
Vondall and Cantrell each pleaded guilty in July to assault resulting in serious bodily injury.
Assistant U.S. Attorney Jessica Betley said in court records that the assault occurred on Oct. 24, 2017 as Cantrell and his girlfriend, Vondall, were drinking and driving around Poplar, on the Fort Peck Indian Reservation. Cantrell was driving a Jeep, while Vondall sat in the front passenger seat. Vondall told investigators she had consumed 14 to 16 cans of Mike’s Harder Lemonade that day.
Vondall had previously been in a dispute regarding a $100 drug debt for methamphetamine with one of the pedestrians in the group.
While driving around Poplar, Cantrell and Vondall saw a group of five people walking down the street, including the person involved in the drug debt dispute. Cantrell stopped the Jeep, Vondall got out and then engaged in a fight with the group. Vondall got back into the Jeep and Cantrell turned the vehicle around.
Witness interviews revealed that Vondall yelled, “Hit them bitches!” and Cantrell plowed through the group with Jeep. A video recording from a nearby surveillance camera showed the Jeep drove straight at the group. Upon impact, bodies flew into the air before hitting the ground. One victim remained motionless in the street. The Jeep flipped onto its top, and Vondall and Cantrell took off running.
The victim was taken by ambulance to the local hospital and then flown to Billings for further treatment. The victim suffered a head injury, collapsed lung and multiple other injuries and fractures.
Two others in the group were treated for injuries at the hospital and released.
Assistant U.S. Attorney Jessica Betley prosecuted the case, which was investigated by the FBI and Fort Peck Criminal Investigations.
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Pittsburgh Man Pleads Guilty in Drug Distribution ConspiracyRead the Press Release
PITTSBURGH, PA - A resident of Pittsburgh, Pa., pleaded guilty in federal court to a charge of violating federal narcotics laws, United States Attorney Scott W. Brady announced today.
Davon Dixon, 29, pleaded guilty yesterday to one count before Chief United States District Judge Joy Flowers Conti.
In connection with the guilty plea, the court was advised that from in and around November, 2015, and continuing thereafter to in and around May, 2016, Dixon conspired with others to distribute and possess with intent to distribute heroin, fentanyl and crack cocaine.
Judge Conti scheduled sentencing for February 28, 2019 at 3:30 p.m. The law provides for a total sentence of 20 years in prison, a fine of $1,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Cindy K. Chung is prosecuting this case on behalf of the government.
A federally administered Organized Crime and Drug Enforcement Task Force (OCDETF) conducted the investigation that led to the prosecution of Davon Dixon. The task force is headed by the Drug Enforcement Administration and is comprised of members drawn from the Pennsylvania Office of the Attorney General, Ambridge Police Department, New Brighton Police Department, Beaver Police Department, Aliquippa Police Department, Moon Township Police Department, Wilkinsburg Police Department, West Mifflin Police Department, Allegheny County Police Department, Duquesne Police Department, Munhall Police Department, Allegheny County Sheriff’s Office, Pittsburgh Bureau of Police, and the Pennsylvania State Police. The OCDETF program supplies critical federal funding and coordination that allows federal and state agencies to work together to successfully identify, investigate, and prosecute major interstate and international drug trafficking organizations and other criminal enterprises.
Opiod Prosecutions Lead to Seizure of Three Million User Doses of Heroin, Oxycodone and Fentanyl Across OregonRead the Press Release
PORTLAND, Ore.—U.S. Attorney Billy J. Williams announced today that since the beginning of May 2018, federal law enforcement authorities and their task force partners have seized 158 pounds of heroin, 600 grams of oxycodone, and half a pound of fentanyl.
Combined, the seizures remove nearly three million individual user doses from statewide distribution networks. The enforcement effort has already netted 19 arrests, 17 guilty pleas and nine criminal sentencings of active drug traffickers with numerous cases still pending.
“The opioid addiction crisis continues to impact millions of Americans every year, many of whom have lost loved ones or continue to watch as their friends or family members struggle with addiction,” said Billy J. Williams, U.S. Attorney for the District of Oregon. “Bringing this crisis to an end requires all Americans—law enforcement and public health officials as well as ordinary citizens—to take action. Visit www.linesforlife.org or another addiction support organization to learn how you can make a difference in your community.”
“The numbers are heart wrenching,” said Keith Weis, DEA Special Agent in Charge for the Pacific Northwest. “In a time of unprecedented health risks facing our society, we must respond aggressively head-on in a multi-faceted, community-based strategy that includes law enforcement, prevention and treatment specialists all working hand in hand to help our most vulnerable members facing life or death struggles against addiction. Every person lost in this opioid crisis is one too many.”
“Opioid abuse in Oregon involves a dangerous cocktail of street drugs (such as heroin and fentanyl) and prescription meds (such as oxycodone, hydrocodone, and morphine). Whether a person starts down the path to addiction on the street or in a doctor's office, the result is equally devastating to the victim's family and community. Because the impact is so significant, the FBI and our partners are prioritizing our work to identify the dealers and doctors who are driving this epidemic,” said Renn Cannon, Special Agent in Charge of the FBI in Oregon.
According to the Centers for Disease Control and Prevention (CDC), drug overdoses killed a record 72,000 Americans in 2017. In 2016, 66% of the more than 66,000 overdose deaths involved an opioid. Drug overdose is now the leading cause of death in the U.S. In 2017, the CDC estimated the national economic burden of prescription opioid overdose, abuse, and dependence at $78.5 billion annually.
In Oregon, the total number of deaths related to drug use increased 11 percent from 2013 to 2017, with 546 drug related deaths in 2017 alone. The use of prescription opioids in Oregon continues to grow dramatically. Nearly half of the prescriptions filled at Oregon retail pharmacies in 2017 were for opioids. As a result, Oregon has one of the highest rates of prescription opioid misuse in the country, with an average of three deaths every week from prescription opioid overdose.
On November 2, 2018, DEA released its 2018 National Drug Threat Assessment. The report paints a bleak picture of the state of drug abuse in the U.S. According to the report, controlled prescription drugs are responsible for the largest number of overdose deaths of any illicit drug class and have been since 2011. Between 2013 and 2016, heroin deaths nearly doubled, exacerbated by the increased adulteration of heroin with fentanyl and other synthetic opioids. Of all opioids, the abuse of illicit fentanyl and other synthetic opioids has led to the greatest number of deaths.
The U.S. Attorney’s Office for the District of Oregon works in partnership with federal, state, local and tribal law enforcement agencies to investigate and prosecute drug trafficking cases involving opioids. Recent prosecutions include:
U.S. v. Brett Allen McNeal
Brett Allen McNeal was the final Oregon defendant sentenced for distributing oxycodone as part of a large, interstate opioid-trafficking organization. He was sentenced to three months in federal prison on October 2, 2018.
The organization was structured around Daniel Cham, a doctor practicing in La Puente, California, who would illegally provide prescriptions for oxycodone, hydrocodone, and other powerful medications in exchange money orders and cash. The narcotics were moved from Southern California through a network of redistributors for eventual sale in Oregon.
Cham would write prescriptions to individuals both known and unknown to him and to others he knew to be prolific drug dealers and addicts. He regularly sold prescriptions to John Bryden, an Oregon resident, who in turn would sell them to other co-conspirators, including Kevin Grimes, Marcela Cooper, and Austin Alderete, for distribution across Oregon.
McNeal purchased oxycodone from Alderete and sold it for a profit to end users. One of those end users, Jessica Morretti, died of an overdose on April 13, 2012. According to text messages on Moretti’s cell phone from the evening she overdosed, McNeal had provided her with five 30mg oxycodone pills the same day.
Cham was sentenced on March 14, 2018 in the Central District of California to more than 13 years in federal prison.
This case was investigated by the FBI.
Read More
U.S. v. Christian Jensel Chaidez
Christian Jensel Chaidez was sentenced to 120 months in federal prison on September 4, 2018 for trafficking heroin and other narcotics into Oregon for distribution in the Salem, Oregon metropolitan area. Chaidez was a local affiliate of a Los Angeles, California-based drug trafficking network.
Using intercepted wire calls, investigators learned that a co-defendant would provide Chaidez with quantities of heroin that Chaidez would, in turn, sell in and around Salem. In November and December 2016 investigators used an undercover informant to purchase one half pound of methamphetamine from Chaidez on two different occasions.
By June 2017, when federal prosecutors unsealed a 12-person indictment, the network, which began primarily as a methamphetamine and cocaine distribution organization, was rapidly expanding into the heroin market. The arrests of Chaidez and others have significantly disrupted the distribution of methamphetamine, cocaine, and other narcotics in the Salem area.
This case was investigated by DEA.
Read More
U.S. v. Christopher James Fleet
On September 4, 2018, Christopher James Fleet, 23, of Portland, was sentenced to 84 months in federal prison and five years of supervised release for possessing distribution quantities of methamphetamine and two firearms.
On August 23, 2017, deputies from the Multnomah County Sheriff’s Office (MCSO) Special Investigation Unit were conducting surveillance at a known drug and gang house in Portland. They observed a vehicle parked in front of the house they believed was connected with Fleet, a drug dealer with an outstanding arrest warrant. Upon leaving the house and attempting to drive away, deputies blocked Fleet using unmarked vehicles and approached him wearing marked law enforcement raid vests. After initially refusing to comply with the deputy’s commands to raise his hands and failing to find an escape route, Fleet surrendered.
During the arrest, deputies found a Kel Tec 9mm firearm and distribution quantities of heroin and methamphetamine on Fleet’s person. They also found a locked backpack in Fleet’s vehicle. The backpack was later found to contain .40 caliber Sig Sauer pistol, drug records, and a digital scale.
This case was investigated by the MCSO Special Investigation Unit.
Read More
The Department of Justice has been resolute in its fight to end the opioid addiction crisis. All 94 U.S. Attorney’s Offices have an opioid action plan with strategies specific to their districts. The department has assigned more than 300 federal prosecutors to U.S. Attorney’s Offices and hired more than 400 DEA task force officers.
In July 2018, the department announced the formation of Operation Synthetic Opioid Surge (S.O.S) that seeks to reduce the supply of deadly synthetic opioids in high impact areas. In August 2018, the department and DEA proposed decreases in manufacturing quotas for the six most frequently misused opioids for 2019. In October 2018, the department announced grant awards totaling more than $320 million dollars to help those most impacted by the opioid crisis including crime victims, children, families and first responders.
Officials from the U.S., Canada and Mexico Participate in 2018 Trilateral Meeting in Mexico City to Discuss Antitrust EnforcementRead the Press Release
Antitrust agency heads from the United States, Canada, and Mexico meet today in Mexico City to discuss their ongoing work to ensure consistent and effective antitrust enforcement and increased cooperation among the three nations.
The meeting includes Assistant Attorney General Makan Delrahim of the U.S. Department of Justice’s Antitrust Division, Federal Trade Commission Chairman Joseph J. Simons, Canadian Acting Commissioner of Competition Matthew Boswell, and President Alejandra Palacios of the Mexican Federal Economic Competition Commission.
The discussions will cover a wide range of topics including developments and priorities, challenges for enforcers in times of antitrust populism, and procedural fairness in antitrust investigations. The officials also are exploring ways to deepen cooperation and convergence on sound antitrust principles.
“The Division’s close relationship with our antitrust colleagues in Mexico and Canada is critical to sound antitrust enforcement in North America,” said Assistant Attorney General Delrahim. “We look forward to our continued efforts to work with our international partners to promote competition to the benefit of consumers.”
“Strengthening ties with our closest neighbors is always a top priority, and I look forward to finding new avenues for cooperation,” said Federal Trade Commission Chairman Joseph J. Simons.
North Royalton man charged with theft of government funds and wire fraudRead the Press Release
A North Royalton man was charged with theft of government funds and wire fraud.
Louis C. Cooper, 57, fraudulently collected benefits from Social Security and Ohio Bureau of Workers’ Compensation while concealing his employment as a general contractor. Cooper had been entitled to disability payments from a work-related injury in 1996. However, Cooper was required to report to both agencies whether he returned to work, which would terminate his ability to receive continued payments from both agencies, according of the criminal information.
Cooper developed a scheme where he could conceal his income as general contractor by asking his clients to not pay him directly. For the past eight years, Cooper earned at least $185,000 as a general contractor, but reported to both agencies numerous times that he was too injured to work in order to fraudulently secure an additional $245,000 total from both agencies, according to the information.
Special Agents Kelly Clark from the Social Security Administration Office of the Inspector General and Mike George from the Ohio Bureau of Workers' Compensation, Special Investigations Department, conducted the investigation. Special Assistant U.S. Attorney Payum Doroodian is prosecuting the case.
If convicted, the Court will determine the defendant’s sentence after a 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 violation. In all cases, the sentence will not exceed the statutory maximum. In most cases, it will be less than the maximum.
An information 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.
North Las Vegas Felon Pleads Guilty to Possession of A 12-Inch Pipe BombRead the Press Release
LAS VEGAS, Nev. – A felon who threatened to “blow up the house” pleaded guilty today to possession of a 12-inch pipe bomb, announced U.S. Attorney Dayle Elieson of the District of Nevada.
Christopher Michael Robinson, 46, of North Las Vegas, pleaded guilty to unlawful possession of a destructive device. He has multiple prior felony convictions in Clark County, Nevada, and Hawaii, including a previous conviction for possessing a pipe bomb.
On January 11, 2018, bomb technicians used a robot to remove a 12-inch pipe bomb from a North Las Vegas house. The house’s resident indicated that he had evicted Robinson for nonpayment of rent and that Robinson had in turn threatened to “blow up the house.” During an interview with law enforcement, Robinson admitted to constructing the pipe bomb and stated that he was currently on parole in Hawaii for previously manufacturing a pipe bomb.
United States District Judge Larry R. Hicks accepted the guilty pleas and scheduled a sentencing hearing for March 6, 2019. Robinson will face the statutory maximum penalty of 10 years in prison and a $250,000 fine.
The case is a joint investigation by the FBI, North Las Vegas Police Department, Las Vegas Metropolitan Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Las Vegas Fire & Rescue Bomb Squad. Assistant U.S. Attorneys Phillip N. Smith, Jr. and Linda Mott are prosecuting the case.
This case was brought as part of Project Safe Neighborhoods (PSN), a nationwide program by the Department of Justice that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. The Department has made turning the tide of rising violent crime in America a top priority. In October 2017, as part of a series of actions to address this crime trend, the Department announced the reinvigoration of PSN. For more information about PSN, visit www.justice.gov/usao-nv.
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Nine Individuals Indicted in November 2018 Federal Grand JuryRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office announced today the results of the November 2018 Federal Grand Jury.
The following named individuals have been charged with a federal crime or crimes by the return of an indictment by the Grand Jury. A grand jury Indictment does not constitute evidence of guilt. A grand jury Indictment is a method of bringing formal charges against the defendant. A defendant is presumed innocent of the charges and may not be found guilty unless evidence establishes guilt beyond a reasonable doubt. United States Sentencing Guidelines may be considered, upon conviction, by the sentencing court. Federal prison sentences are non-parolable.
GATLIN GARY MORGAN, age 37, of Muskogee, OklahomaPossession With Intent To Distribute Methamphetamine
Possession Of A Firearm In Furtherance Of A Drug Trafficking Crime
Felon In Possession Of Firearm And AmmunitionThe Indictment alleges that on or about October 8, 2018, within the Eastern District of Oklahoma, defendant, GATLIN GARY MORGAN, did knowingly and intentionally possess with intent to distribute 500 grams or more of a mixture or substance containing a detectable amount of methamphetamine, a Schedule II controlled substance, in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(A), punishable by not less than 10 years imprisonment, a fine up to $10,000,000.00 or both.
The Indictment further alleges that on or about October 8, 2018, in the Eastern District of Oklahoma the defendant, GATLIN GARY MORGAN, did knowingly possess a firearm, that is, One (1) Glock Model 23, .40 Caliber handgun, serial number SXUY360, in furtherance of a drug trafficking crime for which he may be prosecuted in a court of the United States, that is, Possession with Intent to Distribute Methamphetamine as alleged in Count One, in violation of Title 18, United States Code, Section 924(c)(1)(A), punishable by not less than 5 years imprisonment to run consecutive to any other term of imprisonment imposed, a fine up to $250,000.00 or both.
The Indictment further alleges that on or about October 8, 2018, within the Eastern District of Oklahoma, the defendant, GATLIN GARY MORGAN, having been convicted of a crime punishable by imprisonment for a term exceeding one year, did knowingly possess in and affecting commerce, a firearm and ammunition which had been shipped and transported in interstate commerce, in violation of Title 18, United States Code, Sections 922(g)(1), and 924(a)(2), punishable by not more than 10 years imprisonment, a fine up to $250,000.00 or both.
The charges arose from an investigation by the Muskogee County Sherriff’s Office, the Oklahoma Highway Patrol, and the Drug Enforcement Administration.
Assistant United States Attorney Rob Wallace
STEPHEN-DEAN DOLLARD SCHMIDT, age 27, of Roff, Oklahoma
Possession With Intent To Distribute Methamphetamine (2 Counts)
Possession Of A Firearm In Furtherance Of A Drug Trafficking Crime (2 Counts)
Felon In Possession Of Firearm And Ammunition (2 Counts)The Indictment alleges that on or about April 15, 2018, in the Eastern District of Oklahoma, the defendant, STEPHEN-DEAN DOLLARD SCHMIDT, did knowingly and intentionally possess with the intent to distribute 50 grams or more of a mixture or substance containing a detectable amount of methamphetamine, a Schedule II controlled substance in violation of Title 21, United States Code, Sections 841(a)(1) and 841 (b)(1)(B), punishable by not less than 5 nor more than 40 years imprisonment, a fine up to $5,000,000.00 or both.
The Indictment further alleges that on or about April 15, 2018, in the Eastern District of Oklahoma, the defendant, STEPHEN-DEAN DOLLARD SCHMIDT, did knowingly possess a firearm, to wit, one (1) Smith and Wesson, Model SW9VE, 9mm Luger caliber, semi-automatic pistol, serial number RAV5215 in furtherance of a drug trafficking crime for which he may be prosecuted in a court of the United States, that is, Possession with Intent to Distribute Methamphetamine, as alleged in Count One, in violation of Title 18, United States Code, Section 924(c), punishable by not less than 5 years imprisonment to run consecutive to any other term of imprisonment imposed, a fine up to $250,000.00 or both.
The Indictment further alleges that on or about April 15, 2018, within the Eastern District of Oklahoma, the defendant, STEPHEN-DEAN DOLLARD SCHMIDT, having been convicted of a crime punishable by imprisonment for a term exceeding one year, did knowingly possess in and affecting commerce, a firearm, to wit, one (1) Smith and Wesson, Model SW9VE, 9mm Luger caliber, semi-automatic pistol, serial number RAV5215, which had been shipped and transported in interstate commerce, in violation of Title 18, United States Code, Sections 922(g)(1) and 924(a)(2), punishable by not more than 10 years imprisonment, a fine up to $250,000.00 or both.
The Indictment further alleges that on or about July 2, 2018, in the Eastern District of Oklahoma, the defendant, STEPHEN-DEAN DOLLARD SCHMIDT, did knowingly and intentionally possess with the intent to distribute methamphetamine, a Schedule II controlled substance in violation of Title 21, United States Code, Sections 841(a)(1) and 841 (b)(1)(C), punishable by not more than 20 years imprisonment, a fine up to $1,000,000.00 or both.
The Indictment further alleges that on or about July 2, 2018, in the Eastern District of Oklahoma, the defendant, STEPHEN-DEAN DOLLARD SCHMIDT, did knowingly possess a firearm, to wit, one (1) Taurus, Model PT111 Millennium G2, 9mm Luger caliber, semi-automatic pistol, serial number TKU67600, in furtherance of a drug trafficking crime for which he may be prosecuted in a court of the United States, that is, Possession with Intent to Distribute Methamphetamine, as alleged in Count Four, in violation of Title 18, United States Code, Section 924(c), punishable by not less than 25 years imprisonment to run consecutive to any other term of imprisonment imposed, a fine up to $250,000.00 or both.
The Indictment further alleges that on or about July 2, 2018, within the Eastern District of Oklahoma, the defendant, STEPHEN-DEAN DOLLARD SCHMIDT, having been convicted of a crime punishable by imprisonment for a term exceeding one year, did knowingly possess in and affecting commerce, a firearm, to wit, one (1) Taurus, Model PT111 Millennium G2, 9mm Luger caliber, semi-automatic pistol, serial number TKU67600, which had been shipped and transported in interstate commerce, in violation of Title 18, United States Code, Sections 922(g)(1) and 924(a)(2), punishable by not more than 10 years imprisonment, a fine up to $250,000.00 or both.
The charges arose from an investigation by the Ada Police Department, the Pontotoc County Sheriff’s Office, and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Assistant United States Attorney Dean Burris
CHRISTOPHER MARQUIS RODGERS, age 20, of Humboldt, Tennessee
ANTWAUN ANGLIN, age 39, of Nashville, TennesseeUttering A Countefeit Obligation (1 Count Each)
Possession Of A Countefeit Obligation Of The United States (1 Count Each)The Indictment alleges that on or about September 13, 2018, in the Eastern District of Oklahoma, the Defendants, CHRISTOPHER MARQUIS RODGERS and ANTWAUN ANGLIN, with intent to defraud, did pass, utter, and publish to Sonic Drive-In, located at 610 South Mississippi Ave., Atoka, OK 74525, a falsely made, forged and counterfeited obligation of the United States, that is, a Federal Reserve Note in the denomination of twenty dollars, Series of 2013, Serial No. MK12783752B, which they then knew to be falsely made, forged and counterfeited, in violation of Title 18, United States Code, Sections 472 and 2, punishable by not more than 20 years imprisonment, a fine up to $250,000.00 or both.
The Indictment further alleges that on or about September 13, 2018, in the Eastern District of Oklahoma, the Defendants, CHRISTOPHER MARQUIS RODGERS and ANTWAUN ANGLIN, did knowingly have in their possession and custody, with intent to sell or otherwise use, approximately five hundred seventy-eight (578) falsely made and counterfeited twenty-dollar Federal Reserve Notes, Series 2013, Serial No. MK12783752B, Quadrant # 4, Face Plate 28, Back Plate 22, Federal Reserve Bank K11, made after the similitude of obligations issued under the authority of the United States, in violation of Title 18, United States Code, Sections 474(a) and 2, punishable by not more than 25 years imprisonment, a fine up to $250,000.00 or both.
The charges arose from an investigation by the Caney Police Department, the Atoka Police Department, and the United States Secret Service.
Assistant United States Attorney Clay Compton
KEVIN RUANY GRIJALVA-SOTO, age 29, of Phoenix, Arizona
LESLIE AZUCENA RUBIO-RODRIGUEZ, age 28, of Glendale, ArizonaPossession With Intent To Distribute Methamphetamine (1 Count Each)
The Indictment alleges that on or about September 18, 2018, within the Eastern District of Oklahoma, the defendants, KEVIN RUANY GRIJALVA-SOTO and LESLIE AZUCENA RUBIO-RODRIGUEZ, did knowingly and intentionally possess with intent to distribute 500 grams or more of a mixture or substance containing a detectable amount of methamphetamine, a Schedule II controlled substance, in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(A) and Title 18, United States Code, Section 2, punishable by not less than 10 years nor not more than life imprisonment, a fine up to $10,000,000.00 or both.
The charges arose from an investigation by the Oklahoma Highway Patrol and the Drug Enforcement Administration.
Assistant United States Attorney Dean Burris
JUSTIN DALE KILLER, age 35, of Stilwell, Oklahoma
Felon In Possession Of Firearm
The Indictment alleges that on or about May 24, 2018, within the Eastern District of Oklahoma, the defendant, JUSTIN DALE KILLER, having been convicted of a crime punishable by imprisonment for a term exceeding one year, did knowingly possess in and affecting commerce, a firearm, to-wit: One (1) Glock, Model 19GEN4, 9mm caliber pistol, serial number BDCZ102, which had been shipped and transported in interstate commerce, in violation of Title 18, United States Code, Sections 922(g)(1) and 924(a)(2), punishable by not more than 10 years imprisonment, a fine up to $250,000.00 or both.
The charges arose from an investigation by the Adair County Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Assistant United States Attorney Dean Burris
CLINTON SHANE STRABLE, age 36, of Stigler, Oklahoma
Felon In Possession Of Firearm And Ammunition
The Indictment alleges that on or about April 22, 2018, within the Eastern District of Oklahoma, the defendant, CLINTON SHANE STRABLE, having been convicted of a crime punishable by imprisonment for a term exceeding one year, did knowingly possess in and affecting commerce, the following firearms and ammunition which had been shipped and transported in interstate commerce, in violation of Title 18, United States Code, Sections 922(g)(1), 924(a)(2) and 924(e), punishable by not more than 10 years imprisonment, a fine up to $250,000.00 or both.
The charges arose from an investigation by the Haskell County Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Assistant United States Attorney John David Luton
CLINTON SHANE STRABLE, age 36, of Stigler, Oklahoma
Possession With Intent To Distribute Methamphetamine
The Indictment alleges that on or about September 18, 2018, within the Eastern District of Oklahoma, the defendant, CLINTON SHANE STRABLE, did knowingly and intentionally possess with the intent to distribute 500 grams or more of a mixture or substance containing a detectable amount of methamphetamine, a Schedule II controlled substance, in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(A), punishable by not less than 10 years imprisonment, a fine up to $10,000,000.00 or both.
The charges arose from an investigation by the Pittsburg County Sheriff’s Office and the Drug Enforcement Administration.
Assistant United States Attorney John David Luton
DARRYL EMANUEL BICKHAM, JR., age 34, of McAlester, Oklahoma
Felon In Possession Of Firearm And Ammunition
Possession Of Firearm And Ammunition By Prohibited PersonThe Indictment alleges that on or about August 15, 2018, in the Eastern District of Oklahoma, the Defendant, DARRYL EMANUEL BICKHAM, JR., having been convicted of a crime punishable by imprisonment for a term exceeding one year, did knowingly possess in and affecting commerce, a firearm and ammunition, punishable by not more than 10 years imprisonment, a fine up to $250,000.00 or both.
The Indictment further alleges that on or about August 15, 2018, in the Eastern District of Oklahoma, the defendant, DARRYL EMANUEL BICKHAM Jr., who was subject to a court order issued in the District Court of Hughes County, State of Oklahoma, on May 6, 2015, Case No. PO-15-22, and issued after a hearing of which he received actual notice, and at which he had an opportunity to participate, restraining him from harassing, stalking, or threatening an intimate partner, restraining him from engaging in other conduct that would place an intimate partner in reasonable fear of bodily injury to the partner, that by its terms explicitly prohibited the use, attempted use or threatened use of physical force against such intimate partner that would reasonably be expected to cause bodily injury, that included a finding that the defendant was a credible threat to the physical safety of the intimate partner, did knowingly possess in and affecting interstate commerce, a firearm and ammunition with said firearm and ammunition having been shipped and transported in interstate commerce; in violation of Title 18, United States Code, Sections 922(g)(8) and 924(a)(2), punishable by not more than 10 years imprisonment, a fine up to $250,000.00 or both.
The charges arose from an investigation by the McAlester Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Assistant United States Attorney Jarrod Leaman
New Orleans Man Sentenced for Murder and CarjackingRead the Press Release
U.S. Attorney Peter Strasser announced that MICHAEL BROWN, age 24, of New Orleans, Louisiana, was sentenced today for murder through use of a firearm and carjacking.
BROWN pled guilty on February 22, 2017 to participating in the murder of Jacquez Young on June 1, 2015, and to participating in a carjacking on June 2, 2015.
Judge Eldon E. Fallon sentenced BROWN to 340 months in prison, as well as 5 years of supervised release following the term of imprisonment.
U.S. Attorney Strasser praised the work of the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Jefferson Parish Sheriff’s Office, the Baton Rouge Police Department, the Zachary Police Department, and the Wilkinson County, Mississippi, Sheriff’s Office in investigating this matter. Assistant U.S. Attorney Jonathan L. Shih and Trial Attorney Joseph K. Wheatley, of the Organized Crime and Gang Section of the Department of Justice, are in charge of the prosecution.
This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. Former Attorney General Jeff Sessions made turning the tide of rising violent crime in America a top priority. In October 2017, as part of a series of actions to address this crime trend, Attorney General Sessions announced the reinvigoration of PSN and directed all U.S. Attorney’s Offices to develop a district crime reduction strategy that incorporates the lessons learned since PSN launched in 2001.
New Orleans Man Pleads Guilty to Narcotics ChargesRead the Press Release
U.S. Attorney Peter G. Strasser announced that MARVIN ARMSTRONG, age 32, of New Orleans, LA, has pleaded guilty to two counts of heroin related charges.
According to court documents, ARMSTRONG conspired with others to distribute a quantity of a mixture or substance containing a detectable amount of heroin, in violation of Title 21, United States Code, Sections 841(a)(1), 841(b)(1)(C) and 846, and to distribution of a quantity of a mixture or substance containing a detectable amount of heroin, in violation of Title 21, United States Code, Sections 841(a)(1) and 841(b)(1)(C), and Title 18, United States Code, Section 2.
The Court set sentencing in this matter for February 7, 2019. As to each count, ARMSTRONG faces a term of imprisonment of up to 20 years, a fine of up to $1 million, and at least three years of supervised release following any term of imprisonment.
This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. Former Attorney General Jeff Sessions made turning the tide of rising violent crime in America a top priority. In October 2017, as part of a series of actions to address this crime trend, Attorney General Sessions announced the reinvigoration of PSN and directed all U.S. Attorney’s Offices to develop a district crime reduction strategy that incorporates the lessons learned since PSN launched in 2001.
U. S. Attorney Strasser praised the work of the Bureau of Alcohol, Tobacco, Firearms, and Explosives, the Drug Enforcement Administration, the New Orleans Police Department, and the Louisiana State Police in investigating this matter. The case is being prosecuted by Assistant United States Attorneys Maria M. Carboni and Matthew R. Payne.
New London Woman Sentenced to Federal Prison for Role in Cocaine Trafficking RingRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, today announced that ALBA LORENGIE FILOMENO-GOMEZ, 23, of New London, was sentenced yesterday by U.S. District Judge Vanessa L. Bryant in Hartford to 18 months of imprisonment, followed by five years of supervised release, for her role in a cocaine trafficking ring.
This matter stems from a DEA New Haven Task Force and the U.S. Postal Inspection Service-led investigation into a New Britain man who is alleged to have coordinated the shipment of multi-kilogram quantities of cocaine through the U.S. Mail from Puerto Rico to various locations in Connecticut. More than 12 kilograms of cocaine were seized during the investigation.
Filomeno-Gomez, on behalf of the organization, accepted packages containing kilogram quantities of cocaine that had been mailed from Puerto Rico. She also couriered narcotics and narcotics proceeds between Connecticut and a narcotics distributor in Scranton, Pennsylania.
Filomeno-Gomez was arrested on October 25, 2017. On July 17, 2018, she pleaded guilty to one count of conspiracy to possess 500 grams or more of cocaine.
This matter is being investigated by the DEA New Haven Task Force, U.S. Postal Inspection Service and the Middletown and New Britain Police Departments. The case is being prosecuted by Assistant U.S. Attorney H. Gordon Hall.
Nevada District Court Permanently Enjoins 20 Defendants Connected to A Multi-Million Dollar Mail Fraud SchemeRead the Press Release
LAS VEGAS, Nev. – A federal court in Las Vegas, Nevada, permanently enjoined six individuals and 14 corporate entities from activities related to an alleged mail fraud scheme, the Department of Justice announced today.
In a complaint filed in February 2018, the United States alleged that the defendants mailed thousands of fraudulent solicitations each week. The solicitations purported to inform recipients that they had won large cash or prize packages, but needed to pay a fee to claim the winnings. The solicitations were styled as individual notices and stressed to recipients that they must return the requested fee quickly. According to the complaint, some of the solicitations contained what appeared to be handwritten notes congratulating the recipients on their good fortune, while others reassured recipients that the letters were not a scam. Individuals who sent the requested fees did not receive the expected prizes. The complaint alleged that the Las Vegas-based scheme defrauded consumers out of more than $10 million.
“Consumers should be able to open their mail without encountering false promises of wealth,” said Assistant Attorney General Joseph H. Hunt for the Department of Justice’s Civil Division. “The Department has and will continue to relentlessly pursue schemes like this one.”
“Some of these defendants constantly changed their schemes in attempts to stay one step ahead of the law,” said Delany DeLeon-Colon, Inspector in Charge for the U.S. Postal Inspection Service. “These results make clear that we will peel back the layers, find the individuals behind these schemes, and hold them to account.”
The complaint alleged that defendant Patti Kern orchestrated the activities of the other individual defendants, all of whom live in the Las Vegas area. The complaint alleged that defendants Edgar Del Rio, Sean O’Connor, and Epifanio Castro printed the solicitations; defendant Andrea Burrow opened and processed victim responses; and defendant Stephen Fennell managed the scheme’s lists of recipients. The solicitations were mailed under a plethora of company names, including 11 of the entities named as corporate defendants in the complaint.
The district court entered a default judgment against 11 defendants today and previously entered consent decrees against the nine other defendants named in the complaint. Those orders prohibit the defendants from mailing solicitations like those identified in the complaint, as well as from engaging in activities related to such mailings, including receiving, handling, or opening any victim mail responding to solicitations and using or benefiting from lists of victims who previously responded to solicitations. Additionally, the orders authorize the U.S. Postal Inspection Service to open mail that was detained by law enforcement and return payments to the scheme’s victims.
The matter was handled by Trial Attorney Jacqueline Blaesi-Freed of the Civil Division’s Consumer Protection Branch, in coordination with the United States Attorney’s Office for the District of Nevada and the United States Postal Inspection Service. Additional information on the original enforcement actions and Department of Justice’s efforts to combat elder fraud is at: https://www.justice.gov/opa/pr/justice-department-coordinates-nationwide-elder-fraud-sweep-more-250-defendants.
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Munhall Felon Pleads Guilty to Possessing Heroin, Gun and More than $25K in Cash during Drug Trafficking OperationRead the Press Release
PITTSBURGH, Pa – A former resident of Munhall, Pa., pleaded guilty in federal court to violating federal firearms and narcotics laws, United States Attorney Scott W. Brady announced today.
Charles Payne, 25, pleaded guilty to one count of possession of firearms by a convicted felon, one count of possession with intent to distribute heroin, and one count of possession of a firearm in furtherance of a drug trafficking crime, before United States District Judge Donetta Ambrose.
In connection with the guilty plea, the court was advised that on November 10, 2017, Allegheny County Police assisted by Munhall Police Department executed a search warrant at a home on Martha Street in Munhall, PA. Payne was discovered in the upstairs bedroom with his girlfriend and infant child. In the first floor of the house, investigators found a large garbage bag filled with bricks of heroin, empty brick wrappers, a Pennsylvania state ID for Charles Payne, and approximately $25,000 in cash. Investigators also found two digital scales, three boxes of ammunition, a laser sight, and a loaded stolen silver handgun in the house. Payne had previously been convicted of a state drug trafficking conviction and is prohibited from possessing any firearms.
Judge Ambrose scheduled sentencing for March 23, 2019. The law provides for a maximum total sentence of a mandatory minimum five years in prison to life, a fine of $1,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and prior record of the defendant. Payne will continue to be detained pending sentencing.
This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. Turning the tide of rising violent crime in America is a top priority of the Department of Justice.
Assistant United States Attorney Timothy Lanni is prosecuting this case on behalf of the government.
The Allegheny County Police – Narcotics Unit conducted the investigation leading to the guilty plea in this case.
MoneyGram International Inc. Agrees to Extend Deferred Prosecution Agreement, Forfeits $125 Million in Settlement with Justice Department and Federal Trade CommissionRead the Press Release
MoneyGram International Inc. (MoneyGram), a global money services business headquartered in Dallas, Texas, has agreed to extend its deferred prosecution agreement and forfeit $125 million due to significant weaknesses in MoneyGram’s anti-fraud and anti-money laundering (AML) program resulting in MoneyGram’s breach of its 2012 deferred prosecution agreement (DPA). In addition to the monetary payment and extension of the deferred prosecution agreement, the company must enhance its anti-fraud and AML compliance programs.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney David J. Freed of the Middle District of Pennsylvania, Federal Trade Commission (FTC) Chairman Joseph Simons and Postal Inspector-in-Charge Daniel B. Brubaker of the U.S. Postal Inspection Service (USPIS) Philadelphia Division made the announcement.
A two-count felony criminal information was filed on Nov. 9, 2012, in the Middle District of Pennsylvania charging MoneyGram with willfully failing to maintain an effective AML program and aiding and abetting wire fraud. The government agreed to defer prosecution on the information for five years provided MoneyGram complied with the DPA. Today’s amendment to the agreement will extend the term of the DPA for 30 months.
According to court documents filed in 2012, MoneyGram was involved in consumer fraud schemes perpetrated by corrupt MoneyGram agents and others. In the fraud scams, which generally targeted the elderly and other vulnerable groups, perpetrators contacted victims in the United States and falsely posed as victim’s relatives in urgent need of money, falsely promised large cash prizes, or promised items for sale over the internet at deeply discounted prices. The perpetrators required the victims to send funds through MoneyGram’s money transfer system.
According to the joint motion filed today to extend and amend the DPA, MoneyGram breached its 2012 DPA. During the course of the DPA, MoneyGram experienced significant weaknesses in its AML and anti-fraud program, inadequately disclosed these weaknesses to the government, and failed to complete all of the DPA’s required enhanced compliance undertakings. As a result of its failures, MoneyGram processed at least $125 million in additional consumer fraud transactions between April 2015 and October 2016.
Today, as a result of MoneyGram’s breach of the DPA, the government filed a motion to extend all the terms of MoneyGram’s DPA and amend and enhance MoneyGram’s compliance requirements pursuant to the DPA. In addition, MoneyGram agreed to forfeit $125 million, which the department intends to return to victims of fraud through the Justice Department’s Victim Compensation Program. Under the terms of the extension, the government has agreed to continue to defer prosecution for a period of 30 months, after which time the government would seek to dismiss charges if MoneyGram has complied with the agreement.
As part of the amendment to and extension of the DPA, MoneyGram has agreed to additional enhanced compliance obligations, including creating policies or procedures:
- to block certain reported fraud receivers and senders from using MoneyGram’s money transfer system within two days of receiving a complaint identifying those individuals;
- to require individuals worldwide to provide government-issued identification to send or receive money transfers;
- to monitor all money transfers originating in the United States in its anti-fraud program; and
- to terminate, discipline, or restrict agents processing a high volume of transactions related to reported fraud receivers and senders.
In a related case, MoneyGram agreed to settle contempt allegations by the FTC filed today in the U.S. District Court for the Northern District of Illinois, alleging that MoneyGram violated its 2009 order with the FTC. The FTC alleges that MoneyGram failed to implement the comprehensive fraud prevention program mandated by the 2009 order, which requires the company to promptly investigate, restrict, suspend, and terminate high-fraud agents. According to the FTC, MoneyGram was aware for years of the high levels of fraud and suspicious activities involving certain agents, including large chain agents, but failed to promptly conduct required reviews or suspend or terminate agents, as required by the 2009 order.
In resolving the FTC allegations, MoneyGram agreed to a monetary judgment of $125 million and to an expanded and modified order that will supersede the Commission’s 2009 order and apply to money transfers worldwide. The modified order requires, among other things, that the company block the money transfers of known perpetrators of fraud schemes and provide refunds to fraud victims in circumstances where its agents fail to comply with applicable policies and procedures. In addition, the modified order includes enhanced due diligence, investigative, and disciplinary requirements.
The USPIS and the U.S. Attorney’s Office for the Middle District of Pennsylvania have been investigating and prosecuting consumer fraud schemes using MoneyGram’s money transfer system since 2007. To date, the U.S. Attorney’s Office of the Middle District of Pennsylvania has charged 37 MoneyGram agent owners for conspiracy, money laundering and fraud-related violations. Twenty-eight of those charged have been convicted.
USPIS’s Philadelphia Division’s Harrisburg, Pennsylvania Office investigated the case. Senior Trial Attorney Margaret A. Moeser of the Criminal Division’s Money Laundering and Asset Recovery Section’s Bank Integrity Unit and Assistant U.S. Attorney Kim Douglas Daniel of the Middle District of Pennsylvania are prosecuting the case. The department appreciates the significant cooperation and assistance provided by the FTC in this matter.
Persons who believe they were victims of the fraud scheme should visit the Department of Justice’s victim website at MoneyGramRemission.com or call 844-269-2630 for updates on how to request compensation as a result of this action.
The Victim Compensation Program, operated by the Money Laundering and Asset Recovery Section, is composed of a team of experienced professionals, including attorneys, accountants, auditors and claims analysts. In hundreds of cases, the Victim Compensation Program has successfully used its specialized expertise to efficiently convert forfeited assets to victim recoveries.
The Bank Integrity Unit investigates and prosecutes complex, multi-district, and international criminal cases involving financial institutions. The Unit’s prosecutions focus on banks and other financial institutions, including their officers, managers, and employees, whose actions threaten the integrity of the individual institution or the wider financial system.
Michigan Home Health Agency Owner Sentenced to Seven Years in Prison for Role in $1.6 Million Health Care Fraud SchemeRead the Press Release
The owner of a Michigan home health agency was sentenced to 84 months in prison today for her role in a scheme involving approximately $1.6 million in fraudulent Medicare claims for home health services that were procured through the payment of kickbacks, and that were medically unnecessary and not provided.
Assistant Attorney General Brian A. Benczowski of the Justice Department’s Criminal Division, U.S. Attorney Matthew J. Schneider of the Eastern District of Michigan, Special Agent in Charge Timothy R. Slater of the FBI’s Detroit Field Office and Special Agent in Charge Lamont Pugh III of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Chicago Regional Office made the announcement.
Editha Manzano, 70, of Troy, Michigan, was sentenced by U.S. District Judge Gershwin A. Drain of the Eastern District of Michigan. Judge Drain also ordered Manzano to pay $1,593,804.35 in restitution, jointly and severally with her co-conspirators, and to forfeit $758,407.07. On Dec. 4, 2017, Manzano was convicted after a two-week trial on all counts that were charged in the indictment -- one count of conspiracy to commit health care and wire fraud, one count of conspiracy to pay and receive kickbacks in connection with Medicare beneficiaries, and one count of health care fraud.
According to evidence presented at trial, from 2013 to 2016, Manzano masterminded a scheme to defraud Medicare of approximately $1.6 million by submitting false and fraudulent claims for home health care services in connection with Anointed Care Services (Anointed), a Detroit-area home health care agency. Medicare requires that physical therapy and skilled nursing services in the home be provided only to Medicare beneficiaries who are homebound and need the services. The evidence showed that Manzano paid illegal kickbacks in exchange for recruited beneficiaries’ signatures on blank home health documents. The evidence further showed that Manzano conspired with physicians to admit beneficiaries for home health care with Anointed when they did not qualify for such services. Manzano and her co-conspirators then billed Medicare for home health services that were never provided, the evidence showed. To make it appear that the services were medically necessary and actually provided, Manzano and her co-conspirators fabricated and falsified medical records, the evidence showed.
The evidence further showed that Manzano conspired with physicians to provide medically unnecessary opioids to beneficiaries who signed up for home health care with Anointed. Some of these beneficiaries sold the opioids to drug dealers to be resold on the street; others traded the opioids to drug dealers in exchange for crack cocaine.
Manzano was charged along with Liberty Jaramillo, 68, also of Troy; Roberto Quizon, M.D., 72, of Bloomfield Hills, Michigan; Juan Yrorita, R.N., 64, of Sterling Heights, Michigan, and Victoria Gallardo-Navarra, M.D., 75, also of Bloomfield Hills, in an indictment returned on Sept. 1, 2016. Jaramillo and Quizon pleaded guilty prior to trial and were sentenced to serve 36 months and 18 months in prison, respectively. Gallardo-Navarra was acquitted, and Yrorita pleaded guilty on the fifth day of trial and was sentenced to serve 36 months in prison.
The FBI and HHS-OIG investigated the case, which was brought as part of the Medicare Fraud Strike Force under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Eastern District of Michigan. Trial Attorneys Jacob Foster and Rebecca Yuan of the Fraud Section prosecuted the case.
The Criminal Division’s Fraud Section leads the Medicare Fraud Strike Force. Since its inception in March 2007, the Medicare Fraud Strike Force, which maintains 14 strike forces operating in 23 districts, has charged nearly 4,000 defendants who have collectively billed the Medicare program for more than $14 billion.
Men Sentenced for Methamphetamine Distribution in Jacksonville, North CarolinaRead the Press Release
RALEIGH – The United States Attorney for the Eastern District of North Carolina, Robert J. Higdon, Jr., announced that today in federal court, United States District Judge James C. Dever, III sentenced SAMUEL MONSERRATE-GARCIA, 55, of Midway Park, North Carolina and VICTOR RODRIGUEZ, 41, of Jacksonville, North Carolina for their roles in distributing methamphetamine in the Jacksonville area.
On August 7, 2018, MONSERRATE-GARCIA pled guilty to Conspiracy to Distribute and Possess With Intent to Distribute 50 Grams or More of Methamphetamine (Count One) and Possession With Intent to Distribute 50 grams or More of Methamphetamine and Aiding and Abetting (Count Two) and today he was sentenced to 120 months imprisonment followed by 5 years of supervised release. Also on August 7, 2018, RODRIGUEZ pled guilty to Possession With Intent to Distribute 50 Grams or More of Methamphetamine and Aiding and Abetting, and today he was sentenced to 120 months of imprisonment followed by 5 years of supervised release.
MONSERRATE-GARCIA and RODRIGUEZ had been charged by the grand jury for the Eastern District of North Carolina in a Second Superseding Indictment filed on March 28, 2018.
On October 6, 2016, members of the Onslow County Sheriff’s Office determined that MONSERRATE-GARCIA and RODRIGUEZ were attempting to sell crystal methamphetamine from a hotel in Jacksonville, North Carolina.
On October 7, 2016, officers executed a search warrant at the hotel room. Officers seized two bags containing a total of 95.97 grams of 99% pure methamphetamine (“Ice”), as well as marijuana, cocaine, and a digital scale.
An individual indicated that MONSERRATE-GARCIA had agreed to distribute six kilograms of pure methamphetamine (“Ice”) for him.
This prosecution is part of an extensive investigation by the Organized Crime Drug Enforcement Task Force (OCDETF). OCDETF is a joint federal, state, and local cooperative approach to combat drug trafficking and is the nation’s primary tool for disrupting and dismantling major drug trafficking organizations, targeting national and regional level drug trafficking organizations, and coordinating the necessary law enforcement entities and resources to disrupt or dismantle the targeted criminal organization and seize their assets.
The Drug Enforcement Administration and the Onslow County Sheriff’s Office conducted the criminal investigation of this case. Assistant United States Attorney Scott A. Lemmon handled the prosecution of this case for the government.
Medicaid Biller Sentenced to Prison for Medicaid FraudRead the Press Release
NEW BERN – United States Attorney Robert J. Higdon, Jr. announced that yesterday in federal court, United States District Judge Louise W. Flanagan sentenced RENEE CHRISTINE BORUNDA, 36, of Greensboro, North Carolina, to 37 months in federal prison followed by 3 years of supervised release following her prior guilty plea to Conspiracy to Commit Health Fraud Conspiracy and Aggravated Identity Theft. BORUNDA was also ordered to make restitution of $225,399.08 to the North Carolina Medicaid program.
The Criminal Information to which BORUNDA pleaded guilty, as well as information provided at the sentencing hearing, stated that BORUNDA managed a company that offered behavioral health services to Medicaid recipients in Wilson, North Carolina. In 2013 and 2014, BORUNDA used one of the company’s therapist’s personal information to submit fraudulent electronic claims. The claims were submitted from two different companies. The claims falsely represented that the therapist had provided $225,339.08 worth of behavioral services to over 200 different Medicaid recipients who lived in Beaufort, Edgecombe, Greene, Guilford, Lenoir, Mecklenburg, Pitt, and Wilson Counties, when in fact no such services were rendered. The therapist was unaware that her information was being used to commit the fraud.
United States Attorney Robert J. Higdon, Jr. stated, “Fraud in the behavioral health sector is a plague upon our district and the country at large. This case, like several others prosecuted by this office in the last several years, sends a strong message to those who seek to defraud Medicaid and Medicare - programs essential to the wellbeing of the American people. These individuals will be aggressively prosecuted.”
North Carolina Attorney General Josh Stein said, “Cheating Medicaid wastes tax dollars, and it’s unacceptable. My office will continue our work to protect taxpayers and hold the healthcare providers who commit fraud accountable.”
The investigation of this case was conducted by agents of the North Carolina State Bureau of Investigation (“SBI”) assigned to the Medicaid Investigations Division of the North Carolina Attorney General’s Office (“MID”), Financial Investigators with the MID, and the Internal Revenue Service - Criminal Investigation. Assistance was provided by the Office of Compliance and Program Integrity of the North Carolina Division of Health Benefits, EastPointe, Sandhills Center, and Trillium Health Resources. The investigation and prosecution of this matter was handled in a partnership between the United States Attorney’s Office for the Eastern District of North Carolina and the Medicaid Investigations Division of the North Carolina Attorney General’s Office. SBI Assistant Special Agent in Charge Lolita Howell was the lead investigator. Special Assistant United States Attorneys Mike Heavner and John Parris of the Medicaid Investigations Division of the North Carolina Attorney General’s Office represented the United States.
McNairy County Man Sentenced to Life Imprisonment for Methamphetamine TraffickingRead the Press Release
Jackson, TN. – Michael Jay Harris, 47, of McNairy County, TN was sentenced to life imprisonment for methamphetamine trafficking. D. Michael Dunavant U.S. Attorney for the Western District of Tennessee announced the sentence today.
Proof at trial showed that on February 13, 2017, agents with the McNairy County Narcotics Unit, including officers with the Selmer Police Department and McNairy County Sheriff’s Department, went to the residence of Michael Jay Harris, in the Northwestern corner of McNairy County, in Finger, TN, to arrest Harris on an outstanding warrant. Law enforcement found Harris in possession of a bag containing three and a half ounces of ice methamphetamine and marijuana, as well as digital scales and drug paraphernalia. When the agent found the narcotics, Harris became combative and attempted to fight the officers. A chemist with the Drug Enforcement Administration found the methamphetamine was more than 97 percent pure, and an agent with the Federal Bureau of Investigation testified it could have been distributed to more than a thousand drug users, based on its purity.
Following an August 2018 trial, Harris was convicted by a jury for possession of 98 grams of actual methamphetamine with the intent to distribute. Harris had four previous drug trafficking convictions in the State of Tennessee, and faced a mandatory life sentence as a career drug offender.
U.S. Attorney D. Michael Dunavant said, "Methamphetamine that is trafficked in and through West Tennessee continues to increase in purity, which increases its potential to cause addiction, injury, and death. Harris is a career drug offender who has devoted his life to criminal activity that endangered the citizens of West Tennessee, and this life sentence is well-earned and justified to protect the public. I commend the outstanding investigative work of local law enforcement, and thank AUSA Matt Wilson for his effective prosecution of this important case."
On November 8, 2018, U.S. District Judge J. Daniel Breen sentenced Harris to life imprisonment.
This case was investigated by the Selmer Police Department, McNairy County Sheriff’s Department and the Drug Enforcement Administration.
Assistant U.S. Attorney Matt Wilson prosecuted this case on behalf of the government.
Massachusetts Man Pleads Guilty to Fentanyl TraffickingRead the Press Release
CONCORD - Victor Soto, 38, of Dorchester, Massachusetts, pleaded guilty in federal court to possession of over 40 grams of fentanyl with intent to distribute, United States Attorney Scott W. Murray announced today.
According to court documents and statements made in court, on May 30, 2018, Manchester police officers acquired reliable information that the defendant would deliver 300 to 400 grams of fentanyl to Manchester later that day. The Manchester police officers shared this information with the New Hampshire State Police. On the evening of May 30, 2018, the New Hampshire State Police located defendant’s black Acura SUV driving north on I-93. The defendant was driving alone. The police followed the defendant to route 293 and then on to South Willow St. in Manchester, where they stopped him. During a subsequent consent search of his vehicle, the officers located approximately 394 grams of fentanyl in the trunk.
Soto is scheduled to be sentenced on February 14, 2019.
“Fentanyl continues to cause tremendous damage to communities throughout New Hampshire,” said U.S. Attorney Murray. “In order to protect the lives and safety of the public, we will investigate, arrest and prosecute those who choose to distribute this deadly drug in the Granite State. I commend the law enforcement officers whose work prevented this substantial amount of fentanyl from being sold on the streets of Manchester.”
“We’re very pleased that our close coordination with local and state partners in New Hampshire allowed for the successful prosecution of this case,” said Peter C. Fitzhugh, Special Agent In Charge, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. “HSI will continue to prioritize investigations to combat this deadly opioid and fentanyl epidemic.”
This matter was investigated by the Manchester Police Department, New Hampshire State Police, and U.S. Immigration and Customs Enforcement's Homeland Security Investigations. The case is being prosecuted by Assistant U.S. Attorney John Davis.
This case was supported by the Organized Crime Drug Enforcement Task Force (OCDETF). The OCDETF program is a federal multi-agency, multi-jurisdictional task force that supplies supplemental federal funding to federal and state agencies involved in the identification, investigation, and prosecution of major drug trafficking organizations.
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Markham Lynch Sentenced for Marriage FraudRead the Press Release
SHAWN N. ANDERSON, United States Attorney for the Districts of Guam and the Northern Mariana Islands, announced that defendant MARKHAM LYNCH, age 52, from Tamuning, was sentenced today in District Court by Senior District Judge Alex R. Munson for Conspiracy to Commit Marriage Fraud, in violation of Title 18, United States Code, Section 371. Defendant LYNCH was sentenced to 50 hours of community service, two years probation, $8,500 fine, and a $100 special assessment fee.
LYNCH and Jong Yun Kim conspired for LYNCH to illegally marry and petition for Kim’s girlfriend to receive a Permanent Resident Card and remain in the United States. LYNCH would receive $20,000 or more if the plan succeeded. At the time, Kim’s girlfriend was unlawfully present in the United States under the terms of the Guam Visa Waiver Program. LYNCH and Kim’s girlfriend were married in the Superior Court of Guam in 2014. LYNCH informed immigration officials that he and Kim’s girlfriend were living together when, in fact, they were not. Kim’s girlfriend had been residing with Kim since her entry into Guam. LYNCH received $8,500 for the fraudulent marriage. Kim was convicted earlier this year for his part in the scheme.
U.S. Attorney Anderson stated, “The Guam Visa Waiver program allows the entry of certain foreign nationals for not more than 45 days for the limited purposes of business and tourism. The program has the potential to greatly benefit Guam’s economy. However, as demonstrated by this case, those admitted may use the program as a means to commit criminal offenses once on island. Abuse of the waiver system by foreign nationals or United States citizens risks its continued viability. Foreign nationals who are convicted of violating our immigration laws also risk deportation and being barred from future entry. Our office will assist Homeland Security Investigations at every opportunity to enforce federal immigration laws on Guam and the Northern Mariana Islands.”
Special Agents from the Department of Homeland Security, Homeland Security Investigations (HSI) conducted the investigation. Assistant United States Attorney Stephen F. Leon Guerrero prosecuted the case.
Man Pleads Guilty to $20 Million Tax FraudRead the Press Release
HOUSTON – A man who had owned Stat Source Inc. has admitted he willfully failed to truthfully account for and pay over employment taxes to the IRS, announced U.S. Attorney Ryan K. Patrick.
Jonathan Adam Van Pelt withheld federal income taxes and Social Security and Medicare taxes from the wages of employees for one employment tax quarter. However, he did not timely file the required Employer’s Quarterly Federal Income Tax Return for that quarter reporting the withholdings and did not pay over the withholdings to the IRS.
In the plea agreement filed in the record of the case, Van Pelt admitted the total employment taxes he failed to pay to the IRS for Stat Source Inc., was more than $20 million, the amount owed for 18 employment tax quarters running from the third quarter of 2011 through the fourth quarter of 2015. Van Pelt admitted he spent the money owed on the unpaid employment taxes on various luxury items, such as luxury automobiles, expensive furniture, leather goods, jewelry, an expensive home, lavish vacations and various entertainment venues.
He has agreed to pay $20 million in restitution to the IRS.
U.S. District Judge Alfred H. Bennett accepted the plea today and has set sentencing for Jan. 17, 2019. At that time, Van Pelt faces up to five years in federal prison and a possible $250,000 fine. He was permitted to remain on bond pending that hearing.
IRS-Criminal Investigation conducted the investigation. Assistant U.S. Attorney Charles J. Escher is investigating the case.
Malvern Man Sentenced to over 8 Years in Federal Prison for Drug TraffickingRead the Press Release
Hot Springs, Arkansas - Duane (DAK) Kees, United States Attorney for the Western District of Arkansas, announced that Larry Speakar, age 51, of Malvern, Arkansas was sentenced today to 100 months in federal prison followed by three years of supervised release on one count of Possession with Intent to Distribute Methamphetamine . The Honorable Susan O. Hickey, United States District Judge, presided over the sentencing hearing in Hot Springs.
According to court records, in March 2017, investigators with the Drug Task Force in Garland County and Homeland Security Investigations initiated an investigation into the drug trafficking activity of Speakar. In March and April 2017, agents conducted three controlled purchases of methamphetamine from Speakar. On April 26, 2017, law enforcement officers stopped a vehicle in Hot Springs for speeding. The driver later identified as Speakar was on parole and had a search wavier on file. A search of his vehicle resulted in officers locating 2 plastic bags containing at least 50 grams of a crystalline substance which field tested positive for methamphetamine.
A federal grand jury indicted Speakar in June 2017, and he pled guilty in March 2018.
This case was investigated by the Garland County Drug Task Force and Homeland Security Investigations. Assistant United States Attorney David Harris prosecuted the case for the United States.
Los Angeles Man Pleads Guilty to Defrauding Investors Through an $8.3 Million Binary Options SchemeRead the Press Release
The former CEO of Citrades pleaded guilty today for his role in a scheme to defraud investors out of $8.3 million in the United States and across the world in financial instruments known as “binary options,” announced Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and Assistant Director in Charge Nancy McNamara of the FBI’s Washington Field Office. Citrades was a purported internet-based investment platform.
Jason Benjamin Scharf, 37, of Los Angeles, California, pleaded guilty to one count of conspiracy to commit wire fraud before U.S. District Judge George H. Wu of the Central District of California. Sentencing has been scheduled for Feb. 25, 2019, before Judge Wu.
As part of his guilty plea, Scharf admitted that from February 2013 through December 2015, he oversaw the day-to-day operations of Citrades as the company’s CEO, and that he agreed with his co-conspirators to induce investors to purchase binary options based on materially misleading misrepresentations and omissions. As described in the plea agreement, a binary option is a type of option contract in which the payout depends on the outcome of a discrete event, typically related to whether the price of a particular asset—such as a stock or a commodity—will rise above or fall below a specified amount.
Scharf admitted that representatives of Citrades falsely claimed to be representing the interests of investors in binary options when in reality they were representing the financial interests of Citrades. Scharf further admitted that while Citrades marketed itself as a trading platform through which binary options could be traded, investors were not actually trading with other investors. Instead, they were investing in transactions whose parameters, including the “strike price” associated with the binary option, were set by a separate company that served as a platform provider. Scharf admitted that Citrades operated its binary options business principally out of Israel, but had representatives and co-conspirators working on its behalf in the United States.
Scharf further admitted that after being served with an administrative subpoena, he deleted potentially incriminating emails from an account that he used to conduct Citrades-related business.
This case was investigated by the FBI. Trial Attorney Ankush Khardori of the Criminal Division’s Fraud Section is prosecuting the case. The Criminal Division’s Office of International Affairs and the Israeli National Police also provided assistance.
Individuals who believe that they may be a victim in this case should visit the Fraud Section’s Victim Witness website for more information.
Leader of Cartel Del Noreste and Nephew of Los Zetas Leaders Z-40 and Z-42 Receives Two Consecutive Life Sentences Plus 20 Years in Federal PrisonRead the Press Release
In Waco today, U.S. District Judge Alia Moses sentenced 38-year-old Juan Francisco “Kiko” Trevino Chavez, nephew of Los Zetas leaders Miguel Angel Trevino Morales (Z-40) and Oscar Omar Trevino Morales (Z-42), to two consecutive life imprisonment sentences plus 20 years in federal prison. In addition to the prison terms, Judge Moses ordered that Trevino pay a $2 Million fine and a $2 Million money judgment.
That announcement was made by U.S. Attorney John F. Bash; Special Agent in Charge Shane Folden, Homeland Security Investigations (HSI), San Antonio Division; Special Agent in Charge Tamera Cantu, IRS—Criminal Investigation, Dallas Division; Special Agent in Charge Will Glaspy, Drug Enforcement Administration (DEA), Houston Division; Special Agent in Charge Fred Milanowski, Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF), Houston Division; and, Special Agent in Charge Christopher Combs, FBI, San Antonio Division.
On July 24, 2018, a jury convicted the defendant on one count each of conspiracy to possess marijuana with intent to distribute, conspiracy to import marijuana, unlawful distribution of controlled substances (extra-territorial), conspiracy to possess cocaine with intent to distribute, conspiracy to import cocaine, conspiracy to possess firearms in furtherance of drug trafficking, and conspiracy to commit money laundering.
Evidence presented at trial revealed that from 2004 until September 2016, the defendant was a member of the Los Zetas, a transnational drug trafficking organization operating primarily in the Mexican corridors of Nuevo Laredo, Tamaulipas, Ciudad Acuna and Piedras Negras, Coahuila. Evidence further revealed that Kiko Trevino worked with and conspired with the highest level operatives in the criminal organization, including his uncles, Z-40 and Z-42. Evidence also revealed that Kiko Trevino organized the source and distribution of large quantities of narcotics, laundered drug proceeds, and controlled cells of traffickers and a group of armed sicarios in the Nueva Laredo area. The trial evidence showed the defendant participated in the trafficking of more than 250,000 kilos of cocaine, hundreds of thousands of kilos of marijuana, and hundreds of firearms. The evidence further described the laundering of hundreds of millions of dollars in drug proceeds. Finally, trial testimony revealed that after his uncles’ arrests, Los Zetas splintered into two groups and Kiko Trevino took over leadership of one of those two groups, the Cartel Del Noreste (CDN), and in this role, he controlled all of the drug and firearm trafficking, enforcement, and money laundering operations of CDN. Trevino continued in this leadership role until his arrest in 2016.
“Trevino-Chavez, also known as ‘Comandante Kiko,’ is a leader/organizer for a major Transnational Criminal Organization that is responsible for smuggling literally tons of drugs into South Texas. Homeland Security Investigations specializes in complex cross-border conspiracy investigations targeting violent and dangerous individuals who threaten or violate the national security of the United States,” stated HSI Special Agent in Charge Folden.
“As a result of the consistent and exceptional efforts of U.S. law enforcement working together with our international law enforcement partners, a very significant drug trafficker from Mexico has been brought to justice. The Kiko Trevino sentencing serves as an example that there are no borders when it comes to prosecuting international drug traffickers,” stated DEA Special Agent in Charge Glaspy.
“This investigation is a prime example of the fine work done when agencies come together to become a force multiplier,” stated ATF Special Agent in Charge Milanowski.
Kiko Trevino has remained in federal custody since his arrest in Baytown, TX, on September 28, 2016.
This federal prosecution resulted from multiple Organized Crime Drug Enforcement Task Force (OCDETF) operations and investigations, originating out of Waco, SA, DR, Eagle Pass and Dallas area metroplex, conducted by HSI, IRS-Criminal Investigations, DEA-High Intensity Drug Trafficking Area Group, FBI, ATF, U.S. Marshals Service, Texas Rangers, Texas Department of Public Safety, Irving Police Department, Waco Police Department, Laredo Police Department, and Leon Valley Police Department. The U.S. Border Patrol, Customs and Border Protection—Office of Enforcement Operations, and Natalia Police Department also provided support in this case.
The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering operations, and those primarily responsible for the nation’s illegal drug supply.
Lake Mary Man Convicted of Mail Fraud Involving Scheme to Defraud Ebay and PaypalRead the Press Release
Orlando, Florida – United States Attorney Maria Chapa Lopez announces that Brian R. Kucharski (28, Lake Mary) has pleaded guilty to mail fraud. Kucharski faces a maximum penalty of 20 years in federal prison. A sentencing date has not yet been set.
According to the plea agreement, Kucharski created eBay accounts using stolen and fraudulently obtained personal identifying information, including the names and dates of birth of over 500 individuals. Kucharski negotiated the fraudulent sale of fictitious products, predominantly gift cards, through eBay. The eBay customers paid for the items through fraudulent PayPal accounts that were created by Kucharski. Instead of mailing the purchased items to the customers, Kucharski used the U.S. Postal Service (USPS) to disguise his fraudulent activities by mailing random items to other individuals, and using the USPS tracking numbers to represent to eBay and its customers that he had mailed the purchased items. Ultimately, the victims never received the items and eBay routinely denied their demands for a refund.
Postal customers all over the United States became concerned after they received priority mail packages containing random items of no value. As a result of complaints made to local police departments and post offices, investigators identified Kucharski as the perpetrator of the scheme.
Further, Kucharski used the fraudulently obtained proceeds of his illegal activities to purchase precious metals, which were delivered to him via the U.S. mail.
This case was investigated by U.S. Postal Inspection Service. It is being prosecuted by Assistant United States Attorney Ilianys Rivera Miranda.
Justice Department Releases Memorandum on Litigation Guidelines for Civil Consent Decrees and Settlement AgreementsRead the Press Release
Attorney General Jeff Sessions signed a memorandum yesterday providing direction to all civil litigating components and United States Attorneys’ Offices (USAOs) on the principles that should be followed when resolving a civil lawsuit against a state or local governmental entity. State and local governments have unique roles under the Constitution, and the Department is committed to ensuring that its practices in these cases are transparent, impartial, and consistent with fundamental constitutional principles, including democratic control and accountability.
The memo includes guidelines on:
- How civil litigating components and USAOs should handle investigations and reports of allegations;
- The notice, approval, and substantive requirements for consent decrees[1] and settlement agreements, as well as constitutional and policy considerations;
- Use and limits of monitors for state and local governmental entities.
These guidelines are designed to ensure that consent decrees with state and local governments are narrowly tailored to remedy the alleged violations, and are not used to extract greater relief from the state or local government than the Department could obtain through litigation. They are also structured to ensure that, where appropriate, responsibility is returned to democratically accountable state and local institutions. Requirements include, but are not limited to, limits on duration of a consent decree, clear triggers for termination, and prohibitions on using consent decrees to achieve general policy goals. The memo also clarifies the approval process for both consent decrees and settlement agreements, to ensure that they receive appropriate review by the Office of the Deputy Attorney General, the Associate Attorney General, and other senior Department leadership.
The full text of the memo can be found
here .
[1] A consent decree is a negotiated agreement entered as a court order that is enforceable by the court. A settlement agreement is an out-of-court resolution that requires a signed agreement, or memorandum of understanding, and performance by the defendant. Required periodic assessment of compliance or noncompliance is handled by consultation of the parties without involving a court. If there is a breach of contract by the defendant, the government may file a lawsuit to enforce the agreement.
Jury Finds Texas Man Guilty for Role in Complex Nigerian Money Laundering RingRead the Press Release
Tampa, Florida – A federal jury has found Okechuwku Desmond Amadi (39, Garland, TX) guilty of conspiracy to commit money laundering and individual counts of money laundering. Amadi faces a maximum penalty of 60 years in federal prison. His sentencing hearing has not yet been set.
Amadi was indicted on September 19, 2017. He was arrested on September 28, 2017, at John F. Kennedy International Airport, in New York City, after returning from a trip to Nigeria.
According to the evidence presented at trial, Amadi worked with an international criminal organization based in Nigeria that defrauded dozens of victims across the United States and then laundered proceeds of the fraud through a complex network of bank accounts. The criminal organization, known as the Neo Black Movement of Africa, or the Black Axe Group, coordinated fraud and money laundering activity throughout the globe via cells or “zones” in Nigeria, Canada, the United States, and elsewhere.
Black Axe fraud schemes took various forms. Many of the fraud victims were elderly, widowed or divorced women who had developed relationships with fake suitors on dating websites. These victims were convinced to wire money, which often consisted of their retirement savings and cash taken out from their home equity, to bank accounts in the United States as part of a supposed investment opportunity. Other victims included title companies that were defrauded with fake cashier’s checks during phony real estate transactions.
Victims were instructed to wire their money into accounts held by U.S.-based conspirators, known as “money mules,” and the funds were then quickly moved to other accounts in the United States and around the world before the victims could discover the fraud. Bank records presented at trial indicated that, from 2012 to 2015, several million dollars in wire transfers were laundered. Amadi, a real estate investor and insurance broker in Texas, used his bank accounts to launder more than $833,000 in fraud proceeds that victims had sent to accounts controlled by an associate of his in the Dallas area. Amadi wired much of that money overseas, including to Canada and Nigeria, to promote the conspiracy and conceal the source of the funds.
This case was investigated by the FBI, with assistance from various federal and local law enforcement partners throughout the country, including the Toronto Police Service and the Toronto Strategic Partnership in Ontario, Canada. It is being prosecuted by Assistant United States Attorneys Patrick Scruggs and Diego Novaes.