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14 December 2018
Mexican Citizen Sentenced for Destruction of Government PropertyRead the Press Release
ALBANY, NEW YORK – Moises Orozco Castaneda, age 57, and a citizen of Mexico, was sentenced yesterday to time served (41 days in jail), for misdemeanor destruction of government property.
The announcement was made by United States Attorney Grant C. Jaquith and Thomas E. Feeley, Director of the Buffalo Field Office of Immigration and Customs Enforcement (ICE), Enforcement and Removal Operations (ERO).
Orozco Castaneda, an illegal alien, was arrested by ICE in Troy, New York, in June 2018. ICE released Orozco Castaneda from custody but the conditions of his release required that he wear an ankle-monitoring device so that his release could be supervised by ICE. On September 11, 2018, ICE was notified that the monitoring device had been removed from Orozco Castaneda’s ankle. The device was recovered in Troy that same day. Orozco Castaneda was encountered at an Albany bus station and he admitted to cutting off the device.
Following his sentencing, Orozco Castaneda was remanded to the custody of the Department of Homeland Security, for removal proceedings.
This case was investigated by ICE-ERO and prosecuted by Assistant U.S. Attorney Edward P. Grogan.
Mayport Navy Lieutenant Pleads Guilty to Using the Internet to Entice and Meet A Child to Engage in Sexual ActivityRead the Press Release
Jacksonville, Florida – United States Attorney Maria Chapa Lopez announces today that Michael Douglas McNeil (31, Jacksonville) has pleaded guilty to using the internet to attempt to entice a child to engage in sexual activity. McNeil faces a minimum mandatory penalty of 10 years, and up to life, in federal prison. McNeil is a lieutenant in the U.S. Navy; he has been detained since his arrest on August 30, 2018.
According to court documents, on August 27, 2018, a detective with the Clay County Sheriff’s Office, who was posing online as a family member of a 12-year-old handicapped child, received a message on a social media application from McNeil, who identified himself as “Mark.” McNeil expressed interested in having sex with the “child” and was advised that the “child” was 12 years old. Between August 27 and August 30, 2018, McNeil and the undercover detective discussed plans for McNeil to meet the “child” for sex. McNeil asked for several photos of the “child,” sent the undercover detective an explicit photo of himself, and asked specific questions about the “child’s” sexual experience and abilities. On August 30, 2018, McNeil drove to a coffee shop in Orange Park to meet the “child” for sex and was arrested.
During an interview, McNeil admitted, among other things, that he had engaged in online and text conversation with the “guardian” of the 12-year-old “child,” that he had sent them a photo of his own genitalia, and that he showed up to meet the “child” because of his “curiosity” about “a younger girl.”
This case was investigated by the Clay County Sheriff’s Office, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the Naval Criminal Investigative Service, and the Jacksonville Sheriff’s Office. It is being prosecuted by Assistant United States Attorney D. Rodney Brown.
It is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Maryland Man Sentenced to Five Years in Prison for Participating in a Drug Trafficking ConspiracyRead the Press Release
WASHINGTON – Everette Reel, 46, of Upper Marlboro, Md., was sentenced today to five years in prison on charges stemming from an investigation into a narcotics conspiracy involving eight individuals in Washington, D.C. and Maryland, announced U.S. Attorney Jessie K. Liu and Nancy McNamara, Assistant Director in Charge of the FBI’s Washington Field Office.
Reel pled guilty in September 2018 in the U.S. District Court for the District of Columbia to one count of conspiracy to distribute and possess with intent to distribute 28 grams or more of cocaine base and a detectable amount of cocaine. The Honorable Richard J. Leon sentenced Reel to the prison term, to be followed by five years of supervised release.
Reel was arrested with seven other individuals in March 2018 on charges stemming from a conspiracy to distribute and possess with intent to distribute cocaine and 280 grams or more of crack. In May 2015, the FBI, with the assistance of the Metropolitan Police Department (MPD), began a long-term investigation into a drug trafficking organization that operated in the Montana Terrace neighborhood of Northeast Washington and extended into Maryland. Numerous defendants also were charged with possessing and distributing various narcotics, including crack, cocaine, PCP and fentanyl, during the period of the investigation.
During the execution of a search warrant on Reel’s residence, FBI agents recovered approximately 15 grams of cocaine, a .40 caliber Springfield Armory pistol, 12 rounds of ammunition in two separate calibers, a gun box, and approximately $16,000 in cash.
This case is part of an Organized Crime and Drug Enforcement Task Force (OCDETF) investigation. OCDETF specializes in the investigation and prosecution of drug trafficking and money laundering organizations and related criminal enterprises.
In announcing the sentence, U.S. Attorney Liu and Assistant Director in Charge McNamara, commended the work of those who investigated the case. They cited the efforts of those who worked on the case from the U.S. Attorney’s Office for the District of Columbia, including Paralegal Specialists Jeannette Litz and Teesha Tobias, and Assistant U.S. Attorneys Christopher Macchiaroli and Kevin Rosenberg of the Violent Crime and Narcotics Section, who conducted the underlying investigation, indicted the case, and are prosecuting the remaining defendants.
Marshall County man admits to drug distribution chargeRead the Press Release
WHEELING, WEST VIRGINIA – Kevin Mark Simms, of Moundsville, West Virginia, has admitted to a drug distribution charge, United States Attorney Bill Powell announced.
Simms, age 63, pled guilty to one count of “Distribution of Oxycodone.” Simms admitted to selling oxycodone in Marshall County in October 2017.
Simms faces up to 20 years incarceration and a fine of up to $1,000,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Robert H. McWilliams, Jr. is prosecuting the cases on behalf of the government. The Marshall County Drug & Violent Crimes Task Force, a HIDTA-funded initiative, investigated.
Senior U.S. District Judge Frederick P. Stamp, Jr. presided.
Man Sentenced for Distributing Fentanyl Causing Serious Bodily InjuryRead the Press Release
ALEXANDRIA, Va. – A Dumfries man was sentenced today to over 21 years in prison for distribution of fentanyl causing serious bodily harm.
According to court records, Christopher Louis Sorensen, 31, admitted that in February he distributed fentanyl to a female friend who later suffered respiratory arrest, a life-threatening condition that required medical intervention, including CPR and Narcan, a life-saving opioid overdose reversal drug used by first responders.
According to the statement of facts, Sorensen admitted that from 2015 to 2018, he sold over 400 grams of fentanyl, which he purchased from drug dealers in Baltimore. Additionally, Sorensen admitted that from 2009 to 2018, he sold over 5,000 tablets of 30 milligram oxycodone pills, acquired from a medical provider in Maryland and filled by a pharmacy in the Eastern District of Virginia, and often sold the tablets in the vicinity of the pharmacy that filled the prescription.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Matthew J. DeSarno, Special Agent in Charge of the Criminal Division at the FBI’s Washington Field Office, made the announcement after sentencing by Senior U.S. District Judge T.S. Ellis III. Assistant U.S. Attorney James L. Trump and Special Assistant U.S. Attorney Kaitlin Paulson prosecuted the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-cr-237.
Man Pleads Guilty to Defrauding Bank and Small Business Administration of MillionsRead the Press Release
A Tulsa man entered a guilty plea today for defrauding a bank of nearly $5 million and to bankruptcy fraud, announced U.S. Attorney Trent Shores.
Zealand Benjamin Thigpen III, 68, pleaded guilty in U.S. District Court to defrauding Arvest Bank of $4,754,488 from 2015 to 2017.
As part of his scheme, Thigpen owned and operated Julimar Trading, LLC., which bought and sold refined metal alloys, principally for the production of steel. Julimar’s operations were funded by Avrest Bank and, in part, guaranteed by the Small Business Administration. The bank financing was secured by his company’s inventory and accounts receivable, as well as Thigpen’s personal guarantees. When submitting financial documentation to the bank on October 4, 2016, Thigpen provided false information about the value of Julimar’s inventory and accounts receivable, explaining the inventory was worth $5,816,335. As a result, Arvest and Small Business Administration continued his line of credit under false pretenses. In fact, the accounts receivable and inventory were nearly non-existent.
Later, on November 18, 2016, Thigpen filed pursuant to Chapter 7 in U.S. Bankruptcy Court, and once again lied about Julimar’s inventory, stating that it was worth just over $3.3 million, when he was fully aware it only totaled only a few thousand dollars.
“Mr. Thigpen defrauded Arvest Bank and the federal government of more than $4.7 million. Moreover, he exploited a system set up to provide opportunities to innovative entrepreneurs pursuing legitimate businesses,” stated U.S. Attorney Trent Shores. “Fraudsters like Mr. Thigpen hurt the health of our economy. Our federal prosecutors who focus on white collar crime take great pride in the fact that they help protect the integrity of our financial institutions. I appreciate their diligence and commitment to upholding the rule of law.”
As part of his plea, Thigpen agreed to the entry of a forfeiture money judgment of $4,754,488. U.S. District Judge Claire V. Eagan set sentencing for March 20, 2019. Thigpen faces a maximum penalty of 30 years in prison as to the bank fraud and 5 years in prison as to the bankruptcy fraud.
This case resulted from a joint investigation performed by the Offices of Inspectors General of the Department of the Treasury and the Small Business Administration and was prosecuted by Assistant U.S. Attorney Kevin C. Leitch.
Long Island Man Sentenced to 90 Months’ Imprisonment for Fentanyl TraffickingRead the Press Release
Earlier today, in federal court in Central Islip, Jamal Brown was sentenced by United States District Judge Joseph F. Bianco to 90 months’ imprisonment for distributing and possessing with intent to distribute more than 40 grams of fentanyl between July 2017 and February 2018. Brown pleaded guilty to the charge in May 2018.
Richard P. Donoghue, United States Attorney for the Eastern District of New York, and Ray Donovan, Special Agent-in-Charge, U.S. Drug Enforcement Administration, New York Division (DEA), announced the sentence.
“Brown preyed on vulnerable addicts to enrich himself, exposing them to significant risk of overdose with fentanyl, a drug that is a leading factor in the opioid crisis plaguing Long Island and the United States,” stated United States Attorney Donoghue. “To facilitate his illegal drug distribution, Brown even involved his teenage brother. Thanks to the outstanding work of our prosecutors and law enforcement partners, Brown has now been held accountable.” Mr. Donoghue also expressed his grateful appreciation to the Bureau of Alcohol, Tobacco, Firearms and Explosives for its assistance during the investigation and the DEA’s Long Island Heroin Task Force, which is comprised of the Nassau County Police Department, Suffolk County Police Department and New York State Police.
“Drug trafficking is inevitably linked to corruption, crime and addiction,” stated DEA Special Agent-in-Charge Donovan. “Jamal Brown turned his younger brother into a drug dealer, exposed his newborn child to fentanyl and encouraged drug use by addicts seeking treatment. Today’s sentencing is a result of the hard work and collaboration between the Heroin Enforcement Team, ATF and the U.S. Attorney’s Office EDNY.”
According to court filings, sentencing submissions and facts presented during court proceedings, between July 2017 and February 2018, Brown possessed and sold more than 40 grams of fentanyl, along with quantities of cocaine, which he stored at locations in Bay Shore and Huntington Station, New York. As part of his drug-trafficking operation, Brown used his 17-year-old brother to sell fentanyl and cocaine for him and to store sale proceeds, which he gave to Brown. Telephone calls intercepted over a court-authorized wiretap revealed that Brown also relied on an individual – who had told Brown of his struggles with addiction and of his plan to enter a rehabilitation facility – to transport narcotics and pick up drug sale proceeds.
On February 27, 2018, search warrants executed at Brown’s Long Island drug locations resulted in the recovery of more than 76 grams of fentanyl, more than 150 grams of cocaine, a .32 caliber Smith and Wesson handgun, ammunition and other evidence of drug trafficking. At the time of the execution of the search warrants, Brown’s newborn child was inside the Huntington Station location where approximately 10 grams of fentanyl were recovered.
The government’s case is being handled by the Office’s Long Island Criminal Division. Assistant United States Attorney Bradley T. King is in charge of the prosecution.
The Defendant:
JAMAL BROWN
Age: 26
Huntington Station, New York
E.D.N.Y. Docket No. 18-CR-182 (JFB)Local Woman Sentenced for Her Role in Attempting to Introduce Controlled Substances into the Orleans Justice CenterRead the Press Release
NEW ORLEANS – U.S. Attorney Peter G. Strasser announced that BRITTANY THEOPHILE, age 30, of New Orleans, was sentenced yesterday by United States District Judge Nannette Jolivette Brown, to 21 months imprisonment for her role in attempting to introduce controlled substances into the Orleans Justice Center. Upon release from imprisonment, she will serve a one year term of supervised release.
According to court documents, THEOPHILE pleaded guilty to one count of violating Title 21, United States Code, Section 843(b), using a telephone in the commission of a conspiracy to distribute controlled substances. Her co-defendant and friend, ELTON WILLIAMS, was an inmate at the Orleans Justice Center. WILLIAMS solicited the assistance of THEOPHILE and CIBONEY PARKER (a civilian employee of the Orleans Parish Sheriff’s Office), and another friend, RACHELLE KELSON, to smuggle drugs into the jail. THEOPHILE and KELSON provided the drugs, including marijuana, heroin, and Tramadol, to PARKER during her work shift. The Orleans Parish Sheriff’s Office Intelligence Division became aware of the plan through audio and visual surveillance and detained PARKER before she could gain access to WILLIAMS. WILLIAMS, PARKER, and KELSON will be sentenced in early-2019.
U.S. Attorney Peter Strasser praised the work of the FBI and the Orleans Parish Sheriff’s Office Investigative Service Bureau. Assistant United States Attorney Tracey Knight is in charge of this prosecution.
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Lima man indicted for child pornography offensesRead the Press Release
A Lima man was indicted on child pornography charges.
Dustin Davis, 41, was indicted on one count of receipt and distribution of child pornography.
Davis received and distributed numerous images of child pornography between September and November 2018, 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 investigating agency in this case is the Department of Homeland Security. The case is being handled by Assistant U.S. Attorney Tracey Ballard Tangeman.
An indictment is only a charge and is not evidence of guilt. Defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Leader and Others Sent to Federal Prison in Cocaine and Meth Trafficking OperationRead the Press Release
GALVESTON, Texas – A 41-year-old Mexican national who illegally resided in Houston has been ordered to prison following his conviction of conspiracy to possess with intent to distribute cocaine and methamphetamine, announced U.S. Attorney Ryan K. Patrick. Agusto Lazo-Aguirre pleaded guilty March 2, 2018.
Today, U.S. District Judge George C. Hanks Jr. ordered him to prison for 325 months. Not a U.S. citizen, he is expected to face deportation proceedings following his release. At the hearing, Lazo-Aguirre was found to be a leader, manager and organizer of the group and was found to have distributed or been responsible for the distribution of more than five kilograms of cocaine and more than 50 grams of actual methamphetamine during the course of the conspiracy between July 1, 2015, and Feb. 22, 2016.
Previously sentenced were Tony Perez, 24, of Dickinson and Carlos Chayane Morales, 27, of Galveston. Perez received a 168-term of imprisonment, while Morales was ordered to serve a sentence of 120 months.
The investigation began in September 2014. It revealed Lazo-Aguirre purchased cocaine and methamphetamine from several sources in the Houston area and worked with known co-conspirators, such as Perez and Morales. They facilitated the distribution of cocaine and methamphetamine in the Houston-Galveston area and to other destinations throughout the United States.
Those that participated in the conspiracy obtained drugs from or through Lazo-Aguirre and delivered or sold the same drugs in the Houston-Galveston area. They obtained payments in cash for the drugs and returned it to Lazo-Aguirre. Lazo-Aguirre paid these other persons in cash or with drugs.
He 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 Drug Enforcement Administration conducted the investigation. Assistant U.S. Attorney Kenneth Cusick is prosecuting the case.
Justice Department Requires Divestitures to Resolve Antitrust Concerns in Gray’s Merger with RaycomRead the Press Release
The Department of Justice announced today that it will require Gray Television Inc., and Raycom Media Inc., to divest broadcast television stations in nine markets as a condition of resolving a challenge to the proposed $3.6 billion merger between Gray and Raycom.
The Justice Department’s Antitrust Division filed a civil antitrust lawsuit in the U.S. District Court for the District of Columbia to block the proposed merger. At the same time, the Division filed a proposed settlement that, if approved by the court, would resolve the suit by remedying the competitive harms alleged in the complaint, through the divestitures and related conditions.
“Without the required divestitures, Gray’s merger with Raycom threatens serious competitive harm to cable subscribers and small businesses,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division. “I am pleased, however, that we have been able to reach a speedy and complete resolution of the Division’s concerns, thanks in part to the parties’ commitment to engage in good faith settlement talks from the outset of our investigation.”
According to the complaint, without the divestitures the merger would eliminate head-to-head competition between Gray and Raycom in the nine local markets in which the divestitures are being required. In each of those markets, the transaction would increase the number of “Big Four” affiliate stations owned by Gray (i.e., affiliates of NBC, CBS, ABC, or FOX), leaving Gray with two or more Big Four stations in each area. The divestiture markets are Knoxville, Tennessee; Toledo, Ohio; Waco–Temple–Bryan, Texas; Tallahassee, Florida–Thomasville, Georgia; Augusta, Georgia; Odessa-Midland, Texas; Panama City, Florida; Albany, Goergia; and Dothan, Alabama.
As a result of the merger, the combined company would likely charge cable and satellite companies higher retransmission fees to carry the combined company’s broadcast stations, resulting in higher monthly cable and satellite bills for millions of Americans.
The merger would also enable the company to charge local businesses and other advertisers higher prices for spot advertising in the divestiture markets. Businesses rely on competition among broadcast station owners to obtain reasonable advertising prices. Gray and Raycom compete with one another for the business of local advertisers, and the proposed merger would eliminate that competition, harming local businesses.
The Antitrust Division has determined that the divestitures would resolve antitrust concerns related to the licensing of Big Four television retransmission consent and the sale of broadcast television spot advertising that would otherwise result from the merger. The divestitures required under the settlement announced today would, if approved by the court, require Gray to sell the Big Four affiliate stations currently owned by either Raycom or Gray in each of the nine markets where the companies have Big Four overlaps. The settlement requires that the divestitures be accomplished in such a way as to satisfy the United States that the divested stations and associated assets will be used by the buyers as part of a viable, ongoing commercial television broadcasting business.
Gray Television Inc. is a Georgia corporation with its headquarters in Atlanta, Georgia. Gray owns 92 television stations in 56 local markets, of which 83 are Big Four affiliate stations.
Raycom Media Inc. is a Delaware corporation with its headquarters in Montgomery, Alabama. Raycom owns 51 television stations in 43 local markets, of which 45 are Big Four affiliate stations.
As required by the Tunney Act, the proposed settlement, along with the department’s competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement within 60 days of its publication to Owen Kendler, Chief, Media, Entertainment, and Professional Services Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street, N.W., Suite 4000, Washington, D.C. 20530. At the conclusion of the 60-day comment period, the court may enter the final judgment upon a finding that it serves the public interest.
Jury Finds White River Woman Guilty of Assault with a Dangerous WeaponRead the Press Release
United States Attorney Ron Parsons announced that Crystal Earth, age 26, of White River, South Dakota, was found guilty of Assault With a Dangerous Weapon following a four-day jury trial in Pierre, South Dakota. The verdict was returned on December 14, 2018.
The charge carries a maximum sentence of up to 10 years in prison and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
Earth was indicted by a federal grand jury on April 17, 2018. The conviction stems from an incident that occurred on February 26, 2018, in the Horse Creek Community near White River. On that date, Earth was at her home in Horse Creek drinking alcoholic beverages and socializing with a group of people that included the victim. At one point, Earth and the victim, an adult male, got into an argument. Earth took a knife from the kitchen and repeatedly stabbed the victim in the chest and in the face, causing multiple puncture wounds to the victim’s chest and a deep laceration to his chin.
The investigation was conducted by the Rosebud Sioux Tribe Law Enforcement Services. Assistant U.S. Attorneys Kirk Albertson and Cameron Cook prosecuted the case.
A sentencing date has not been set. Earth was remanded to the custody of the U.S. Marshals Service pending sentencing.
Jury Convicts Osceola Woman of Social Security FraudRead the Press Release
KANSAS CITY, Mo. – An Osceola, Mo., woman has been convicted by a trial jury of stealing $47,340 in Social Security benefits.
Carol Ann Davis, 56, was found guilty on Wednesday, Dec. 12, 2018, of five counts of wire fraud and one count of theft of government money.
Davis was approved in April 2003 to receive disability insurance benefits. Her son was approved to receive auxiliary benefits, and Davis served as the representative payee for her son’s auxiliary benefits. Davis received monthly disability insurance auxiliary benefits earmarked for her son between June 2007 and December 2014. However, Davis’s son was not residing with her during that time frame, and she did not use the benefits for the care of her son. Davis, therefore, was not entitled to receive the auxiliary benefits.
Davis falsely reported that her son lived with her and that she spent the entirety of auxiliary benefits for the care of her son. In fact, her ex-husband gained residential custody of their son in June 2007.
Counts one through five of the indictment relate to five auxiliary benefits checks of $579 each that Davis received from August through December 2014.
Following the presentation of evidence, the jury in the U.S. District Court in Kansas City, Mo., deliberated for about two and a half hours on Wednesday before returning the guilty verdict to U.S. District Judge Brian C. Wimes, ending a trial that began Monday, Dec. 10, 2018.
Under federal statutes, Davis is subject to a sentence of up to 20 years in federal prison without parole on each of the wire fraud counts and up to 10 years in federal prison without parole for the theft count. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by Special Assistant U.S. Attorney Courtney R. Pratten and Assistant U.S. Attorney Brian P. Casey. It was investigated by the Social Security Administration, Office of Inspector General.
Informational: Federal Court arraignmentsRead the Press Release
The U.S. Attorney’s Office announced that the following persons were arraigned this week before U.S. Magistrate judges and indictments handed down by the Grand Jury were unsealed. Indictments are merely accusations and defendants are presumed innocent until proven guilty:
Appearing in Billings before U.S. Magistrate Judge Timothy J. Cavan on Dec. 10 and pleading not guilty were:
Danika Nurea Sanchez, 20, of Lame Deer, on charges of conspiracy to possess methamphetamine with intent to distribute and possession with intent to distribute meth. If convicted of the most serious crime, Sanchez faces a minimum mandatory 10 years to life in prison, a $10 million fine and five years of supervised release. The case was investigated by the Drug Enforcement Administration. Pacer case reference. 18-143.
Romer Jesse Jaure, 27, of Busby, on charges of sexual abuse of a minor and abusive sexual contact. If convicted of the most serious crime, Jaure faces a maximum 15 years in prison, a $250,000 fine and five years of supervised release. The case was investigated by the FBI. Pacer case reference. 18-148.
Appearing in Great Falls before U.S. Magistrate Judge John T. Johnston on Dec. 11 and pleading not guilty were:
Holden Stillsmoking, 26, of Browning, on charges of strangulation and assault resulting in serious bodily injury. If convicted of the most serious crime, Stillsmoking faces a maximum 10 years in prison, a $250,000 fine and three years of supervised release. The case was investigated by the FBI. Pacer case reference. 18-102.
Martin St. Goddard, 32, of Browning, on charges of assault with a deadly weapon and assault resulting in serious bodily injury. If convicted of the most serious crime, Goddard faces a maximum 10 years in prison, a $250,000 fine and three years of supervised release. The case was investigated by the FBI. Pacer case reference. 18-100.
Rand Michael Emineth, 26, of Great Falls, on charges of conspiracy to distribute explosives without a license, possession of stolen explosives and felon in possession of a firearm. If convicted of the most serious crime, Emineth faces a maximum 10 years in prison, a $250,000 fine and three years of supervised release. The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Great Falls Police Department. Pacer case reference. 18-90.
Mahliani Kataya Red Eagle, 20, of the Fort Peck Reservation, on charges of possession with intent to distribute methamphetamine. If convicted of the most serious crime Red Eagle faces a minimum mandatory 10 years to life in prison, a $10 million fine and five years of supervised release. The case was investigated by the FBI and Fort Peck Criminal Investigation. Pacer case reference. 18-98.
Justin Leonard Sheehan, 43, of Great Falls, on charges of conspiracy to possess with intent to distribute meth, possession with intent to distribute meth and possession of a firearm in furtherance of a drug trafficking crime. If convicted of the most serious drug crime, Sheehan faces a minimum mandatory 10 years to life in prison, a $10 million fine and five years of supervised release. He also faces a minimum mandatory five years to life in prison consecutive to any other sentence on the firearms count. The case was investigated by the Drug Enforcement Administration. Pacer case reference. 18-101.
Gary Girard Sheehan, 67, of Great Falls, on charges of conspiracy to possess with intent to distribute meth, possession with intent to distribute meth and possession of a firearm in furtherance of a drug trafficking crime. If convicted of the most serious drug crime, Sheehan faces a minimum mandatory 10 years to life in prison, a $10 million fine and five years of supervised release. He also faces a minimum mandatory five years to life consecutive to any other sentence on the firearms count. The case was investigated by the Drug Enforcement Administration. Pacer case reference. 18-101.
Lothar Konrad Krauth, 80, Great Falls, on charges of receipt of child pornography. If convicted of the most serious crime, Krauth faces a minimum mandatory five years to 20 years in prison, a $250,000 fine and three years of supervised release. The case was investigated by Homeland Security Investigations. Pacer case reference. 18-99.
Appearing in Missoula before U.S. Magistrate Judge Jeremiah C. Lynch on Dec. 12 and pleading not guilty was:
Candace Hessel Cummings, 65, of Libby, on charges of tax evasion. If convicted of the most serious crime, Cummings faces a maximum five years in prison, a $100,000 fine and three years of supervised release. The case was investigated by the IRS. Pacer case reference. 18-56.
Appearing on Dec. 13 and pleading not guilty was:
Tina Marie Johnstone, 53, of Helena, on charges of theft of public money and concealment of facts impacting Supplemental Security Income. If convicted of the most serious crime, Johnstone faces a maximum 10 years in prison, a $250,000 fine and three years of supervised release. The case was investigated by the Social Security Administration. Pacer case reference. 18-19.
If any of the above cases are of interest to your media organization and the community it serves, we encourage you to monitor the progress of the case regularly through the U.S. District Court calendar and the PACER system.
To establish a PACER account, which will allow you to review documents filed in the case, please go to, http://www.pacer.gov/register.html. To access the district court’s calendar, please go to https://ecf.mtd.uscourts.gov/cgi-bin/PublicCalendar.pl.
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Indian National Sentenced for Immigration and Investment Fraud SchemeRead the Press Release
ALEXANDRIA, Va. – A native and citizen of India, most recently from Iowa, was sentenced today to four years in prison for an investment fraud scheme and impersonating an employee of the Department of Homeland Security selling genuine United States visas as part of another fraud scheme.
According to court documents, Kanwar Sarabjit Singh, 51, convinced over 20 members of a local Gospel church in Pigeon Forge, Tennessee, that he was a successful businessman who owned a company in India that had a contract with Disney Animation Studios. Promising a large return on their cash investments after a short period of time, Singh took over $340,000 from the victims, many of whom were elderly and had liquidated their retirement accounts or mortgaged their homes, and kept it for himself. Singh also created a fake persona on Facebook and reached out to individuals seeking to come to the United States, or remain in the United States, by offering to get them United States visas in exchange for $3,000 to $4,000. For both schemes, Singh created and used false and fraudulent documents, including a fake identification card purporting to be from the Department of Homeland Security, to assure his victims that he was a federal employee.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Matthew J. DeSarno, Special Agent in Charge of the Criminal Division at the FBI’s Washington Field Office, and Patrick J. Lechleitner, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Washington, D.C., made the announcement after sentencing by U.S. District Judge Liam O’Grady. Assistant U.S. Attorney Kimberly R. Pedersen prosecuted the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-cr-228.
Hot Springs Insurance Agent Pleads Guilty to Defrauding Banks Out of over $3.5 MillionRead the Press Release
Hot Springs, Arkansas – Duane (DAK) Kees, United States Attorney for the Western District of Arkansas announced today that Berry Roland Bishop, age 67, of Hot Springs, Arkansas, pleaded guilty to the offense of Knowingly Defrauding Financial Institutions. The Honorable Susan O. Hickey accepted the plea in the United States District Court in Hot Springs.
According to the Information filed by the United States Attorney’s Office and the plea agreement accepted by the District Court, Bishop defrauded two area banks by two separate schemes. Bishop, president of the Alliance Insurance Group of Arkadelphia, forged the signatures of multiple insurance clients and applied for twenty-seven separate loans in their names with the Bank of Prescott. Bishop applied for these loans without the authorization or knowledge of those clients and, in the process, defrauded the Bank of Prescott out of over $2.1 million. As part of his plea, Bishop also admitted that he defrauded Citizens Bank out of $200,000 by misrepresenting the financial condition of his company, specifically the condition of the collateral, to induce Citizens to approve loans to his company that would not have otherwise been authorized. Bishop applied for these loans from Citizens Bank and the Bank of Prescott to improve the cash flow of his business. According to the plea agreement, both the Government and Bishop agree that the total loss amount attributed to Bishop’s criminal conduct will exceed $3.5 million dollars.
The defendant’s sentence will be determined by the court at a later date. In this case, Bishop faces a maximum sentence of up to thirty years in prison and a fine up to $ 1 million dollars for the Bank Fraud charge.
The FBI investigated the case and Assistant U.S. Attorney Benjamin Wulff of the Western District of Arkansas is prosecuting the case.
Haitian Citizen Sentenced for Illegal Re-entry into United StatesRead the Press Release
ALBANY, NEW YORK – Faveur Cassamajor, age 45, and a citizen of Haiti, was sentenced yesterday to time served (56 days in jail), and a 2-year term of post-release supervision, for illegal re-entry into the United States.
The announcement was made by United States Attorney Grant C. Jaquith and Robert N. Garcia, Chief Patrol Agent, United States Border Patrol, Swanton Sector.
Cassamajor was ordered removed from the United States to Haiti on November 6, 2002. Cassamajor was not removed and instead was released to reside in the United States. On August 21, 2017, Cassamajor departed the United States while the removal order was pending and entered Canada. On October 18, 2018, he was encountered and arrested by a Border Patrol Agent just south of the border after he entered the United States without inspection approximately three miles west of the Champlain Port of Entry. A fingerprint check of Cassamajor resulted in the discovery of the active removal order. Cassamajor admitted that he returned to the United States without permission.
Following the sentencing, Cassamajor was remanded to the custody of the Department of Homeland Security, for removal from the United States.
This case was investigated by Border Patrol and prosecuted by Assistant U.S. Attorney Edward P. Grogan.
Gun and Gang Defendants Receive Substantial Sentences in Operation Brass CatcherRead the Press Release
United States Attorney Joe Kelly announced today the conclusion of a two-year long drug and gun operation, dubbed Operation Brass Catcher. This investigation involved the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Omaha Police Department. The arrests of these individuals were first announced in June 2017 when law enforcement officials conducted early morning operations in Northeast and Northwest Omaha, armed with arrest warrants for 22 individuals on federal and state charges for firearms and narcotics violations. In addition to these arrest warrants, agents and officers served a number of search warrants. Search warrants resulted in the seizure of several firearms, eleven pounds of marijuana, $10,000 in cash and a vehicle.
Operation Brass Catcher began as a seven-month long investigation centered on individuals involved in the trafficking and possession of firearms and narcotics. The vast majority of these individuals had gang affiliations and extensive criminal backgrounds. “This investigation involved federal agents and local law enforcement officers removing some very dangerous individuals from our streets,” said U.S. Attorney Kelly, “We are very pleased with the significant sentences that were handed down by both the federal and state courts. It is impressive to see the resolution, coordination and cooperation among these investigative agencies, and the Douglas County Attorney’s Office, in this very successful investigation and subsequent prosecutions.”
George Lauder, ATF Special Agent in Charge, added, “This investigation has served as a wake-up call to those who would choose to bring gun violence into our neighborhoods. In partnership with the Omaha Police Department, ATF will continue to identify and bring to justice, those who use firearms in furtherance of their criminal activities.”
Below are the names of the individuals convicted and their sentences.
FEDERAL Defendants
- WILLIAMS, Kendall, Age 22, 3055 Redick Avenue, Omaha
18 USC 922(d)(1) transfer of firearm to prohibited person
12 months in Federal Bureau of Prisons
- HOLBERT, Khyre, Age 22, Address 3331 N. 53rd Street, Omaha
18 USC 841(a)(1)(b)(1) distribution crack cocaine; 18 USC 924(c) use or carry of firearm during drug transaction
240 months in Federal Bureau of Prisons
- BECK, Jr., Breck, , Age 21, Address 6061 Camden Street, Omaha
18 USC 922(g)(1) felon in possession of a firearm
21 months in Federal Bureau of Prisons
- HOLMES, Jr., Curtis A., Age 27
18 USC 841(a)(1)(b)(1) distribution of a controlled substance crack cocaine
151 months in Federal Bureau of Prisons
- JACKSON, Sidney, Age 25, Address 2215 Ellison Street, Omaha
18 USC 922(g)(1) felon in possession of a firearm; 18 USC 841(a)(1)(b)(1) distribution crack cocaine; 18 USC 922(k) knowingly possess or manufactures a firearm that lacks a serial number or contains an altered or obliterated serial number; 18 USC 924(c) use or carry of firearm during drug transaction.
60 months in Federal Bureau of Prisons6. GREEN, Trevon, Age 25, Address 2215 Ellison Street, Omaha
18 USC 841(a)(1)(b)(1) distribution marijuana; 18 USC 924(c) use or carry of firearm during drug transaction
27 months in Federal Bureau of Prisons7. ROBINSON, Terrance, Age 20, Address 5316 S. 86th Parkway #6, Omaha
18 USC 841(a)(1)(b)(1) distribution marijuana; 18 USC 924(c) use or carry of firearm during drug transaction
72 months in Federal Bureau of Prisons8. NOBLE, Jr., Lynell, Age 25, Address 5904 Henninger, Omaha
18 USC 922(d)(1) transfer of firearm to prohibited person
18 months in Federal Bureau of Prisons9. HARRIS, Andrell, Age 24, Address 3332 Blondo Street, Omaha
18 USC 922(g)(1) Felon in Possession of a Firearm
46 months in Federal Bureau of Prisons10. CUNEGIN, Kortney, Age 31, Address 6033 N. 167th Court, Omaha
18 USC 922(g)(1) Felon in Possession of a Firearm
63 months Federal Bureau of Prisons
11. McCARTY, Cary, Age 27, address 7505 N. 11th Street, Omaha
18 USC 922(g)(1) felon in possession of a firearm
33 months in Federal Bureau of Prisons
12. WILLIAMS, Loren, Age 26, Address 5337 N. 33rd Avenue, Omaha
18 USC 922(d)(1) transfer of firearm to prohibited person
24 months’ Supervised Release (probation) – U.S. Probation Federal Bureau of Prisons13. HART, James, Age 28, Address 5415 48th Avenue, Omaha
18 USC 841(a)(1)(b)(1) distribution crack cocaine; 18 USC 924(c) use or carry of firearm during drug transaction
36 months in Federal Bureau of Prisons14. BURRUS, James, Age 26, Address 1303 S. 10th Street, Omaha
18 USC 841(a)(1)(b)(1) distribution of methamphetamine
60 months in Federal Bureau of Prisons15. PERKINS, Drelin, Age 20, Address 6329 N. 24th Street, Omaha
18 USC 922(d)(1) transfer of firearm to prohibited person
24 months in Federal Bureau of Prisons
16. MAYFIELD, Mylon, Age 20
18 USC 922(d)(1) transfer of firearm to prohibited person; 18 USC 1512(a)(2)(a) witness tampering
18 months in Federal Bureau of Prisons17. DAMPEER, Kiwan, Age 21
18 USC 841(a)(1)(b)(1) Distribution of a controlled substance marijuana; 18 USC 924 (c) possession of a firearm during a drug transaction
60 months in Federal Bureau of Prisons18. COKES, Robert, Age 31, Address 1519 N. 31st Street, Omaha
18 USC 1512(a)(2)(a) witness tampering
15 months in Federal Bureau of Prison19. BRYE, Larry, Age 26
18 USC 922(g)(3) drug user in possession of a firearm
24 months in Federal Bureau of Prisons
STATE Defendants
- HICKS, Christopher, Age 23, Address 4619 N. 80th Avenue, Omaha
Convicted on 2 counts of delivery or distribution of a controlled substance and
possession of a firearm by a prohibited person (felon)
Sentenced to 20-24 years on each count - consecutive for a total of 40-48 years in
Nebraska Department of Corrections
- PERRY, Detrelle, Age 22, Address 5316 S. 86th Parkway #6, Omaha
Felony flight to avoid arrest and Possession of a firearm by a prohibited person
3 years to 40 months in Nebraska Department of Corrections
- GREEN, Devante, Age 24, Address 4483 Ellison Avenue, Omaha
Possession of a stolen firearm
24 months’ probation
- COOK, Nathaniel, Age 23, Address 3325 N. 41st Street, Omaha
Possession of a firearm by a prohibited person
20 years in Nebraska Department of Corrections
- BENNETT, Norman, Age 32, Address 11514 Camden Avenue, Omaha
Possession of a firearm by a prohibited person
13 years in Nebraska Department of Corrections
- WILLIAMS, Kendall, Age 22, 3055 Redick Avenue, Omaha
Gretna Preacher Pleads Guilty to Stealing over $320,000 from ChurchRead the Press Release
NEW ORLEANS, LOUISIANA – U.S. Attorney Peter G. Strasser announced today that JOSEPH R. ALEXANDER, age 60 of Gretna, Louisiana pleaded guilty on Wednesday, December 12, 2018 to one count of a sixteen count indictment returned December 7, 2017. The government agreed to dismiss the remaining fifteen counts at sentencing, which was set for April 3, 2019 before Judge Sarah S. Vance.
According to the documents filed in open court, ALEXANDER was the minister at a Church of Christ congregation in Gretna, Louisiana. Starting in 2006 and continuing until December 2013, ALEXANDER stole at least $321,491 from the church in three different schemes. The first involved his writing church checks to himself to pay for personal expenses, but creating false entries in church ledgers which indicated the checks were being written to legitimate church vendors. The second method involved his opening an online bank account without church permission and paying personal expenses from the online account. Finally, he forged a church elder’s signature on checks which required two signatures. He also used these funds for personal expenses.
If convicted, ALEXANDER faces a maximum term of imprisonment of thirty (30) years, a fine of one million dollars and five (5) years of supervised release following any term of imprisonment, as well as restitution to the Church.
U.S. Attorney Strasser praised the work of the United States Postal Inspection Service in investigating the matter. The case is being handled by Assistant United States Attorney Carter K.D. Guice Jr.
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Great Falls man sentenced for counterfeiting moneyRead the Press Release
GREAT FALLS—Great Falls resident Derek Mathew Ferdinand, 32, was sentenced to nine months in prison, two years of supervised release and ordered to pay $1,485 restitution in federal court on Dec. 11 for conviction for making fake money, U.S. Attorney Kurt G. Alme said.
U.S. District Judge Brian M. Morris presided.
Ferdinand pleaded guilty earlier to counterfeiting obligations or securities of the United States.
In May 2017, the Great Falls Police Department and Cascade County Sheriff’s Office received reports of counterfeit money circulating through local businesses. Numerous business owners in Belt reported receiving the fake bills and identified Ferdinand as having been present while another person passed the bills. A surveillance video from one business showed Ferdinand passing a counterfeit bill to a bartender.
A witness told investigators that Ferdinand had explained to the person how he made counterfeit money and was “getting the bills perfect.” Law enforcement also spoke to another witness who had pictures of Ferdinand making money and reviewed the photographs. Agents determined that Ferdinand was responsible for making about $2,000 of the counterfeit money that individuals passed in the community.
Assistant U.S. Attorney Jessica Betley prosecuted the case, which was investigated by the U.S. Secret Service and the Great Falls Police Department.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together federal, state, local and tribal law enforcement agencies and the communities they serve to reduce violent crime and make neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of its renewed focus on targeting violent criminals.
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Glendale Attorney Pleads Guilty to Using Client Trust Accounts to Launder More than $500,000 Generated by Tax Fraud SchemeRead the Press Release
SANTA ANA, California – A Glendale lawyer pleaded guilty today to federal charges of using his client trust bank accounts to launder proceeds of a $14 million tax fraud and identity theft scheme that used false identities and bogus Republic of Armenia passports to obtain tax refunds from the Internal Revenue Service.
Arthur S. Charchian, 44, entered guilty pleas to two felony counts this morning before United States District Judge Andrew J. Guilford. Charchian pleaded guilty to one count of money laundering and one count of making a false statement to the Social Security Administration.
According to his plea agreement, Charchian participated in a scheme in which he used two client trust bank accounts – which are supposed to be used by attorneys to segregate client funds from the attorney’s money – to launder approximately $549,000 of proceeds generated in a massive “stolen identity refund fraud” (SIRF) scheme.
The underlying SIRF scheme involved schemers who used false identities and fake Republic of Armenia passports to open hundreds of bank accounts that were used to launder funds fraudulently received from the IRS. A total of 17 defendants, including Charchian, have been publicly charged in that scheme, which involved approximately 7,000 fraudulent tax returns that cumulatively sought about $38 million in refunds. The IRS issued about $14 million in refunds. The fraudulent tax returns were filed and the bank accounts were opened with personal identifying information that had been stolen from thousands of victims. With Charchian’s guilty plea today, the federal investigation into the SIRF scheme has resulted in 11 convictions, and the seizure of four residential properties and more than $700,000. Four defendants remain fugitives from justice, and two defendants are scheduled to go on trial next year.
Charchian admitted in court that from 2012 to 2015 he laundered checks that constituted the proceeds of bank fraud, tax fraud, and identity theft. Charchian became involved in the underlying tax fraud scheme when banks flagged accounts being used by co-conspirators to launder proceeds of the SIRF scheme. Charchian received checks from co-conspirators, deposited those checks into his client trust accounts, and then wrote outgoing checks. He admitted charging a 10 percent fee to launder the money.
For example, on May 9, 2014, Charchian deposited a $57,168 cashier’s check payable to a fraudulent identity into his client trust bank account. Later that month, Charchian wrote an outgoing check from the same client trust bank account for $51,468 – the laundered funds, minus the 10 percent.
In total, Charchian laundered more than 15 incoming checks with a cumulative value of $549,352 that constituted fraud proceeds, he admitted in court. He also admitted to cashing checks from the client trust accounts and dispensing cash to the co-conspirators.
Charchian also admitted that on June 4, 2015, he wrote and signed a letter to the U.S. Social Security Administration on his law firm’s letterhead that falsely asserted the $51,468 check represented the proceeds of a “settlement” for a client. Charchian admitted he wrote the fraudulent letter to help a third party continue to receive Social Security benefits, which Social Security officials had reduced when they learned the person had received some of the money from the “settlement” check.
Judge Guilford scheduled a September 9, 2019 hearing to sentence Charchian, who faces a statutory maximum sentence of 15 years in prison.
This case against Charchian and the defendants in the SIRF scheme is being investigated by IRS Criminal Investigation, the Federal Bureau of Investigation, and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations.
This case is being prosecuted by Assistant United States Attorney Charles E. Pell of the Santa Ana Branch Office.
Fort Wayne Man Sentenced to 135 Months ImprisonmentRead the Press Release
FORT WAYNE – Carlos Silva-Ponce, 42, of Fort Wayne, Indiana, was sentenced before Chief Judge Theresa L. Springmann on his plea of guilty to the charge of conspiracy to distribute cocaine, methamphetamine and heroin, announced U.S. Attorney Thomas L. Kirsch II.
Mr. Silva-Ponce was sentenced to 135 months imprisonment and 5 years of supervised release.
According to documents in this case, from January 2015-July 2016, Mr. Silva-Ponce was part of a conspiracy to distribute cocaine, methamphetamine and heroin. This is part of a larger case involving co-defendants, Alan Chiprez-Garcia, Marco Garcia, Samuel Gemple and Patricia Quinones who have already been sentenced. Jose Razo is the final defendant waiting to be sentenced.
This case was investigated by the Federal Bureau of Investigation’s (FBI) Safe Streets and Gang Task Force, whose members include the FBI, the Indiana State Police, the Allen County Sheriff’s Department, and the Fort Wayne Police Department, with assistance from the Drug Enforcement Administration, the Internal Revenue Service and the Allen County Drug Task Force. This case was prosecuted by Assistant U.S. Attorneys Anthony W. Geller and Stacey Speith.
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Fort Myers Felon Sentenced to Fifteen Years for Fentanyl and Firearm OffensesRead the Press Release
Fort Myers, Florida – United States District Judge Sheri Polster Chappell has sentenced Oliver Rocher (33, Fort Myers) to 15 years and 10 months in federal prison for firearms and drug-related offenses. The court also ordered Rocher to forfeit $4,002 in drug proceeds.
Rocher had pleaded guilty in September 2018.
According to court records, Rocher worked as a pimp and drug dealer out of hotels and motels in Fort Myers during 2017. Women who worked as prostitutes for Rocher provided him with all of the cash they earned. In return, Rocher provided the women with food, clothing, and drugs. When he was arrested at a local motel in August 2017, Rocher had a loaded firearm, crack cocaine, and a significant amount of heroin laced with fentanyl in his possession. Fentanyl is a synthetic opioid that is often added to heroin to increase its potency.
At the time of his arrest, Rocher had a lengthy criminal history dating back to 2004, including previous convictions for drug and firearm possession, as well as burglary. As a previously convicted felon, he was prohibited from possessing firearms or ammunition.
This case was investigated by Lee County Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms and Explosives. It is being prosecuted by Assistant United States Attorney Michael V. Leeman.
This case was brought as part of Project Safe Neighborhoods (PSN), the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime. In the Middle District of Florida, U.S. Attorney Maria Chapa Lopez coordinates PSN efforts in cooperation with various federal, state, and local law enforcement officials.
Former Treasurer of the Crow Creek District Business Committee Sentenced on Embezzlement ChargesRead the Press Release
United States Attorney Ron Parsons announced today that a former treasurer of the Crow Creek District Business Committee was sentenced in federal court on December 13, 2018, in Pierre, South Dakota. Lana Steele, former treasurer of the Crow Creek District Business Committee, was sentenced for Embezzlement and Theft from an Indian Tribal Organization.
Lana Steele, Age 53, of Chamberlain, South Dakota, was sentenced to 4 years of probation, $11,500 in restitution, and a special assessment to the Federal Crime Victims Fund in the amount of $25.
Between November 2013 and November 2015, Steele willfully and knowingly embezzled, misapplied, and converted to her own use, monies, funds, credits, goods, assets, and other property belonging to the Crow Creek District Business Committee, an Indian Tribal Organization.
The investigation was conducted by the Federal Bureau of Investigation. Assistant U.S. Attorney Meghan N. Dilges prosecuted the case.
The case was brought pursuant to The Guardians Project, a federal law enforcement initiative to coordinate efforts between participating agencies, to promote citizen disclosure of public corruption, fraud, and embezzlement involving federal program funds, contracts, and grants, and to hold accountable those who are responsible for adversely affecting those living in South Dakota’s Indian country communities. The Guardians Project is another step of federal law enforcement’s on-going efforts to increase engagement, coordination, and positive action on behalf of tribal communities. Led by the U.S. Attorney’s Office, the participating agencies include: Federal Bureau of Investigation; the Offices of Inspector General for the Departments of Interior, Health and Human Services, Social Security Administration, Agriculture, Transportation, Education, Justice, and Housing and Urban Development; Internal Revenue Service, Criminal Investigation Division; U.S. Postal Inspector Service; U.S. Postal Service, Office of Inspector General.
For additional information about The Guardians Project, please contact the U.S. Attorney’s Office at (605) 330-4400. To report a suspected crime, please contact law enforcement at the federal agency’s locally listed telephone number.
Former NYPD Detective Pleads Guilty to Obstructing Narcotics InvestigationRead the Press Release
Geoffrey S. Berman, United States Attorney for the Southern District of New York, and Raymond Donovan, Special Agent in Charge of the New York Division of the Drug Enforcement Administration (“DEA”), announced that former New York City Police Department (“NYPD”) Detective SAED RABAH pled guilty to knowingly providing misinformation to a federal law enforcement officer in order to obstruct a narcotics investigation. RABAH pled guilty before the U.S. Magistrate Judge Judith C. McCarthy. RABAH’s case has been assigned to U.S. District Judge Vincent L. Briccetti.
Manhattan U.S. Attorney Geoffrey S. Berman said: “As an NYPD detective, Saed Rabah swore to uphold the law – not to break it and help a known criminal continue trafficking drugs. Now this corrupt former officer faces serious prison time for his crimes.”
According to the Information filed today, to which RABAH pled guilty, and a previously filed criminal complaint:
The target of a narcotics investigation was a cooperator in another court proceeding, and RABAH was his handler. Despite his obligation as a cooperator to engage in no further criminal conduct, the target continued to operate a sophisticated narcotics distribution business. In May 2016, RABAH was contacted by law enforcement and informed that the target was under investigation for narcotics related offenses. In September 2016, RABAH was again contacted by law enforcement, this time about whether RABAH had a phone number for the target. RABAH waited to respond and, when he did, intentionally provided a phone number for the target that RABAH knew the target was no longer using, rather than providing the target’s active phone number through which RABAH and the target were regularly communicating at that time.
As alleged in the complaint, RABAH’s obstruction of the investigation was only one component of his corrupt relationship with the target. For example, RABAH shared in the target’s proceeds from operating an illegal sports betting business by bringing in betters. In addition, RABAH and the target traveled to Las Vegas together in July 2016. Moreover, RABAH warned the target when RABAH observed one of the target’s employees make a drug delivery in a manner that RABAH believed could have drawn the attention of law enforcement.
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RABAH, 46, of Brooklyn, New York, is charged with one count of obstruction of justice, which carries a maximum sentence of 20 years in prison. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
RABAH is scheduled to be sentenced March 18, 2019.
Mr. Berman praised the outstanding investigative work of the DEA’s Westchester Tactical Diversion Squad comprising agents and officers of the DEA, Yonkers Police Department, Orangetown Police Department, New York City Police Department, Westchester Police Department, Putnam Sheriff’s Office, Rockland County Sheriff’s Office, New Windsor Police Department, and the Woodbury Police Department. He also thanked the Special Agents of the United States Attorney’s Office for the Southern District of New York for their assistance
This case is being handled by the Office’s White Plains Division. Assistant United States Attorney Celia V. Cohen is in charge of the prosecution.
Former Local State Senator Sentenced on Public Corruption Conviction Involving Incident with A Staff MemberRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y.—U.S. Attorney James P. Kennedy, Jr. announced today that former New York State Senator Marc Panepinto, 53, of Buffalo, NY, who was convicted of promise of employment, compensation, or other benefit for political activity, was sentenced to serve two months in prison and one year supervised release by U.S. Magistrate Judge Michael J. Roemer.
Assistant U.S. Attorney Paul E. Bonanno, who handled the case, stated that the defendant served as the New York State Senator for the 60th Senate District between January 1, 2015, and December 31, 2016. In that position, Panepinto employed a young woman as a staff member in his district office.
On January 7, 2016, the defendant and the staff member traveled together to New York City to attend a fundraiser for Panepinto. Following the event, the staff member took possession of the donations from the fundraiser. Later that evening, the defendant suggested that he and the staff member go to her hotel room to count the donations together.
While in the staff member’s hotel room, Panepinto made a series of unwanted, verbal, and physical sexual advances which were rebuffed by the staff member. The defendant eventually complied with the staff member’s request that he leave, although he did return to the staffer member’s hotel room during the early morning hours in an unsuccessful attempt to get back into her hotel room. The following morning, Panepinto and the staff member returned to Buffalo together. However, the two did not discuss the events that took place the night before.
Upset by what occurred in her hotel room, the staff member subsequently resigned from her position in Panepinto’s district office. Following her resignation, the New York State Senate conducted an investigation into what had occurred, and, as a result of the investigation, referred the matter to the New York State Joint Commission on Public Ethics (JCOPE) for further investigation.
The defendant was concerned that the JCOPE investigation would jeopardize his 2016 campaign for re-election. As a result, Panepinto directed a senior staff member to meet with the staff member and offer her money and/or new employment if she refused to participate in the JCOPE investigation. It was suggested that the new employment would be political in nature and funded in whole or in part by an Act of Congress. The meeting took place on March 7, 2016, at which time the staff member did not accept or refuse the offer. On March 9, 2016, the senior staff member contacted the staff member to arrange a follow-up meeting but the staff member did not agree to a follow-up meeting. Subsequently, on March 15, 2016, Panepinto announced that he would not be seeking re-election to the New York State Senate.
“The defendant essentially sought to purchase this young woman’s silence,” stated U.S. Attorney Kennedy. “In so doing, he placed his own interests above those of his staff and his constituents; he sought to use his position to benefit himself above all others. His abuse of power cost him his office and bought him a federal criminal conviction.”
“Panepinto's admitted criminal misconduct -- behavior that he engaged in while he served in public office -- is not acceptable,” said FBI Special Agent-in-Charge Gary Loeffert. “Today's sentencing highlights the importance of rooting out acts of public corruption in our community.”
Today’s sentencing is the result of an investigation by the Buffalo Division of the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Gary Loeffert, and the New York State Joint Commission on Public Ethics, under the direction of Executive Director Seth H. Agata.
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Former Florida CEO Pleads Guilty to Export Violations and Agrees to Pay Record $17 Million to Department of CommerceRead the Press Release
WASHINGTON, DC – Eric Baird, the former owner and Chief Executive Officer (CEO) of a Florida-based package consolidation and shipping service, has pleaded guilty to one count of felony smuggling and admitted to 166 administrative violations of U.S. export control laws as part of a global settlement with the U.S. Department of Justice (DOJ) and the U.S. Department of Commerce’s Bureau of Industry and Security (BIS).
On December 12, 2018, Baird’s criminal plea was accepted by a federal judge in the U.S. District Court for the Middle District of Florida, and BIS issued an Order outlining the administrative violations and imposing civil penalties of $17 million, with $7 million suspended, and a 5-year denial of export privileges, of which one year is suspended. The civil penalty is the largest to be paid by an individual in BIS history. In February 2017, Access USA settled with BIS and agreed to an administrative civil penalty of $27 million, with $17 million suspended.
As part of the administrative settlement, Baird admitted to violations of the Export Administration Regulations committed from August 1, 2011, through January 7, 2013, during his tenure as CEO of Access USA Shipping, LLC d/b/a MyUS.com (“Access USA”). Baird founded Access USA and developed its business model, which provided foreign customers with a U.S. address that they used to acquire U.S.-origin items for export without alerting U.S. merchants of the items’ intended destinations. Under Baird’s direction, Access USA developed practices and policies which facilitated concealment from U.S. merchants. Access USA would regularly change the values and descriptions of items on export documentation even where it knew the accurate value and nature of the items. Among the altered descriptions were some for controlled items listed on the Commerce Control List (CCL). For example, laser sights for firearms were described as “tools and hardware,” and rifle scopes were described as “sporting goods” or “tools, hand tools.”
Additionally, Baird established and/or authorized Access USA’s “personal shopper” program. As part of this program, Access USA employees purchased items for foreign customers from a shopping list while falsely presenting themselves to U.S. merchants as the domestic end-users of the items. In some cases, Baird directed or authorized Access USA employees to use his personal credit card information, and in others Baird personally asked Access USA employees to apply for and use personal credit cards of their own to make such purchases and have the items sent to their personal addresses. As a result, in addition to being misled to believe that a domestic customer and end-user was involved when the items were in fact intended for export, the U.S. merchant would be misled to believe that Access USA itself was not involved in the transaction.
The activities that Baird knowingly authorized and/or participated in resulted in unlicensed exports of controlled items to various countries, as well as repeated false statements on Automated Export System (AES) filings. As early as September 2011, Baird was made aware that undervaluing violated U.S. export laws, including the EAR. In fact, Baird received e-mails on this subject from his Chief Technology Officer, who stated, “I know we are WILLINGLY AND INTENTIONALLY breaking the law.” (Emphasis in original). In the same email chain, Baird suggested that Access USA could falsely reduce the value of items by 25% on export control documentation submitted to the U.S. government and if “warned by [the U.S.] government,” then the company “can stop ASAP.”
“It was through the outstanding investigative skills and dedication of the special agents of the Department of Commerce and the Department of Homeland Security, that enabled us to protect our country’s national security by detecting, disrupting and prosecuting a complex illegal export scheme led by Access USA’s former owner and CEO, Eric Baird. The message must be received that individuals, as well as companies, are equally liable for their illegal activities,” said BIS Special Agent-in-Charge Robert Luzzi. “BIS brought this action because of the serious potential harm to national security inherent in a business model where companies consolidating or forwarding packages abroad conceal from U.S. merchants the location of foreign customers and the fact that items are intended for export. As a result of these deceptive practices, U.S. merchants’ compliance programs may be unable to detect potential unlicensed exports and other violations.”
“We expect companies and individuals to adhere to our nation’s strict import and export laws,” said U.S. Attorney Chapa Lopez. “Shipping and freight forwarding companies must take sufficient steps to ensure that they are always in compliance with United States law, in order to protect our borders and prevent potentially dangerous items from reaching the hands of our adversaries.”
The case was the result of the joint investigation by BIS’ Office of Export Enforcement and the Department of Homeland Security’s Homeland Security Investigations. It was prosecuted by Assistant U.S. Attorney Patrick Scruggs for the Middle District of Florida, and the Department of Commerce’s Office of Chief Counsel. A criminal sentencing date for Baird is pending with the U.S. District Court for the Middle District of Florida.
Former CEO of Nashville Company Charged with Healthcare Fraud and Aggravated Identity TheftRead the Press Release
NASHVILLE, Tenn. – December 14, 2018 – Margaret Fisher, 60, formerly of Nashville, Tennessee, was arrested yesterday by United States Marshals in Williston, North Dakota and charged with four counts of healthcare fraud and two counts of aggravated identity theft, announced U.S. Attorney Don Cochran for the Middle District of Tennessee.
The November 7, 2018 indictment charges Fisher—the former CEO of Fishield Behavioral Medical Services, Inc.—with defrauding Medicare and Medicaid programs by submitting false and fraudulent claims. According to the indictment, Fisher fraudulently represented that Fishield patients received psychotherapy services from a healthcare provider, who neither provided nor supervised the alleged services. As a result of Fisher’s false claims, Medicare and Medicaid sent Fishield reimbursement checks totaling over $1 million. Fisher would endorse the checks by forging or causing the forgery of the healthcare provider’s signature.
If convicted, Fisher faces a sentence of up to 10 years in prison on the healthcare fraud charges and an additional mandatory two-year sentence on the aggravated identity theft charges. Additionally, she faces a $250,000 fine on each count. The indictment also contains a forfeiture allegation and seeks to forfeit any property derived from the criminal activity and any and all property used to facilitate the unlawful activity, if convicted.
This case was investigated by the U.S. Department of Health & Human Services and the Tennessee Bureau of Investigation. Assistant United States Attorney Sara Beth Myers is prosecuting the case.
The charges are merely an accusation. The defendant is presumed innocent until proven guilty in a court of law.
Former Broker-Dealer Pleads Guilty to Stock ManipulationRead the Press Release
Earlier today, in federal court in Central Islip, Anthony Vassallo, a former broker-dealer who was a manager at Plainview-based Elite Stock Research (ESR) and who subsequently worked at Melville-based My Street Research and related companies (the “boiler room”), pleaded guilty to conspiracy to commit securities fraud in connection with the sale of the stock of two publicly traded companies, CES Synergies, Inc. (CESX), and First Choice Health Care Solutions, Inc. (FCHS). When sentenced, Vassallo faces a maximum of five years’ imprisonment.
Richard P. Donoghue, United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the guilty plea. Mr. Donoghue expressed his appreciation to the United States Securities and Exchange Commission for its significant cooperation and assistance in the investigation.
As alleged in court papers, between May 2013 and June 2016, Vassallo and his co-defendants engaged in a scheme to defraud investors and potential investors in CESX and FCHS by artificially controlling the price and volume of their traded shares by generating price movements and by material misrepresentations and omissions in communications with investors. Vassallo and his co-defendants also fraudulently concealed their control of shares of CESX and FCHS that were held in brokerage accounts in the names of other individuals or entities.
Vassallo is among 16 defendants who were charged in July 2017 in connection with a $147 million illegal stock manipulation scheme, and he is the 11th defendant to plead guilty. The defendants who have pleaded guilty are awaiting sentencing.
The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys Alicyn L. Cooley, Patrick T. Hein and Whitman G.S. Knapp are in charge of the prosecution. Assistant United States Attorney Tanisha R. Payne of the Office’s Asset Forfeiture Section is handling the forfeiture matters.
The Defendant:
ANTHONY VASSALLO
Age: 55
Farmingdale, New YorkE.D.N.Y. Docket No. 17-CR-372 (S-1)
The Defendants Who Previously Pleaded Guilty:
RONALD HARDY
Age: 42
Port Jefferson, New YorkMCARTHUR JEAN, also known as “John McArthur”
Age: 34
Dix Hills, New YorkERIK MATZ
Age: 44
Mt. Sinai, New YorkBRIAN HEEPKE, also known as “Brian Targis”
Age: 36
Farmingdale, New YorkDENNIS VERDEROSA
Age: 67
Coram, New YorkEMIN L. COHEN, also known as “Ian Grant”
Age: 33
Coram, New YorkPAUL EWER
Age: 36
Massapequa, New YorkASHLEY ANTOS
Age: 26
Central Islip, New YorkSERGIO RAMIREZ
Age: 44
East Meadow, New YorkROBERT GILBERT
Age: 51
Cold Spring Harbor, New YorkE.D.N.Y. Docket No. 17-CR-372
Former Bookeeper Sentenced for Wire Fraud in PaducahRead the Press Release
PADUCAH, Ky. – United States Senior District Judge Thomas B. Russell this week sentenced Dana Thomas, age 53, of Paducah, Kentucky, to 27 months in prison followed by 3 years of supervised release, and ordered her to pay restitution of $147,770, announced United States Attorney Russell M. Coleman.
Thomas pleaded guilty to wire fraud on August 21, 2018.
According to a documents before the Court, including a sentencing memo and an Information, beginning in May of 2015, and continuing to in or about December 2017, Thomas, while employed as a bookkeeper at Audiology and Hearing Center, Paducah, Kentucky, exceeded her authorized access by using company credit cards for personal transactions.
Thomas’ crime was recognized after her resignation, when an outside bookkeeper was hired to help with accounting and bill management. The new bookkeeper discovered Thomas had been stealing from the office, in what amounted to $125,570 over the course of her employment. Thomas charged, extravagantly, according to documents spending $5,000 on a condo in Panama City, Florida, and a trip to see the ball drop in New York, New York, among others.
This case was prosecuted by Assistant United States Attorney Madison Sewell, and was investigated by the Federal Bureau of Investigation (FBI).
The United States Attorney’s Office continues a pledge of support to federal, state, and local law enforcement partners in reducing criminal activity in all 53 counties of the Western District of Kentucky, to include the previously underserved Purchase and the Pennyrile Regions which continues to be served through the long term assignment of three Assistant United States Attorneys in Paducah, the most ever in the history of the office.
Former Bank Executive Guilty of Receiving Child Porn on Dark WebRead the Press Release
ALEXANDRIA, Va. – An Arlington man pleaded guilty today to knowingly receiving child pornography on the dark web.
According to court documents, Jon T. Wilkins, 39, a former commercial bank executive, used computers at his residence in Arlington to access the dark web in order to visit an illicit website, Playpen, which catered to the advertisement, distribution, and receipt of child pornography. While on the website, Wilkins created an alias “cowboy357m” and browsed dozens of threads featuring minor children being sexually abused. Wilkins downloaded some of the abusive content to electronic media connected to his computer, and hundreds of images of child pornography and child erotica were found on his computers. Wilkins attempted to conceal his illegal behavior by utilizing Tor, a special web browser that permits access to the dark web while hiding browsing activity. Nonetheless, Wilkins’ conduct was discovered by federal agents who were investigating illegal activity on Playpen.
Wilkins pleaded guilty to knowingly receiving child pornography and faces a mandatory minimum of five years in prison and a maximum term of 20 years in prison when sentenced on April 5, 2019. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
This matter was investigated by the FBI Washington Field Office’s Child Exploitation and Human Trafficking Task Force which is composed of FBI Agents, along with Detectives from the Fairfax County Police, Arlington County Police, Prince William County Police, Loudoun County Sheriff’s Office, Leesburg Police, Alexandria City Police, Washington Metropolitan Police, Fauquier County Sheriff’s Office, George Mason University Police, the United States Marshal’s Service and Agents of various Office of Inspector Generals. The task force was further aided by the FBI’s Violent Crimes Against Children Section’s Major Case Coordination Unit.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Matthew J. DeSarno, Special Agent in Charge of the Criminal Division at the FBI’s Washington Field Office, made the announcement after U.S. District Judge Liam O’Grady accepted the plea. Assistant U.S. Attorneys Nathaniel Smith III and Alexander P. Berrang are prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-cr-189.
Federal Law Enforcement Officer and Ex-Wife Convicted in Large-Scale Drug Trafficking SchemeRead the Press Release
LOS ANGELES – A U.S. Customs and Border Protection (CBP) officer who once worked at Los Angeles International Airport and his ex-wife have been found guilty by a federal jury of multiple felonies for participating in a narcotics distribution ring that moved hundreds of kilograms of cocaine, heroin and marijuana from the Los Angeles area to Chicago.
Manuel Porras Salas, 52, of Fontana, a 25-year veteran of CBP who is on indefinite suspension from the agency, and Sayda Powery Orellana, 50, also of Fontana, were found guilty Thursday afternoon following a five-day trial in United States District Court. Following the verdicts, the defendants were remanded into federal custody.
The jury found Salas and Orellana guilty of one count of conspiracy to distribute controlled substances, one count of conspiracy to commit money laundering, and one count of making false statements to law enforcement. The jury also found Orellana guilty of four additional money laundering counts.
According to court documents and the evidence presented to the jury, Salas, who also worked as a CBP officer at John Wayne and Ontario International airports, and Orellana used a commercial truck driver to move hundreds of kilograms of illegal drugs from California to Illinois. For their participation, the defendants received hundreds of thousands of dollars in compensation that they then laundered through bank accounts held in the name of Orellana and others. Orellana also gambled hundreds of thousands of dollars in the narcotics proceeds at a Southern California casino.
The investigation began when a commercial truck driver was stopped in Gallup, New Mexico on March 11, 2012, with about 260 kilograms of narcotics – including cocaine, heroin and marijuana – valued at approximately $1.5 million dollars. In addition to the narcotics, investigators found bank account numbers belonging to Orellana and a co-conspirator. The commercial truck driver, who later pleaded guilty to possession with intent to distribute controlled substances, told law enforcement that he worked with Salas and Orellana transporting narcotics to Chicago and had done so on multiple occasions. When he drove a truck to Chicago, he would receive cash proceeds for the narcotics, and then Salas and Orellana would direct him to deposit the money into various bank accounts – including an account in Orellana’s name.
When interviewed by federal agents, Salas and Orellana made false statements about their relationship with the truck driver and the source of the money in the bank accounts.
Salas and Orellana are scheduled to be sentenced by United States District Judge Cormac J. Carney on April 15, at which time each will face a mandatory minimum sentence of 10 years’ imprisonment and a statutory maximum sentence of life in federal prison.
The case against Salas and Orellana is the product of an investigation by U.S. Customs and Border Protection, Office of Professional Responsibility; the Drug Enforcement Administration; and IRS Criminal Investigation.
This case is being prosecuted by Assistant United States Attorneys Joseph T. McNally and Aron Ketchel of the Violent and Organized Crime Section.
The U.S. Attorney’s Office for the District of New Mexico provided assistance in this matter.
Federal Judge Sentences Wilmington Man to 90 Months in Heroin Overdose Death CaseRead the Press Release
WILMINGTON, Del. – David C. Weiss, United States Attorney for the District of Delaware, announced that on December 11, 2018, Wali Bey, a/k/a James Goodwyn,[1] age 58, of the Wilmington, Delaware, was sentenced to 90 months in prison after pleading guilty to conspiracy to distribute heroin. At sentencing, U.S. District Judge Richard G. Andrews found that Bey knew that the heroin he was selling created an “extra risk” that someone might overdose and that the heroin Bey sold, in fact, contributed to a woman’s death.
According to public court filings and the government’s arguments in open court, on November 25, 2016, Bey and another individual agreed to sell a small amount of heroin to a young woman. After using the heroin, the woman overdosed and died. Her body was transported by wheelbarrow and car to the Edgemoor neighborhood in New Castle County where it was ultimately dumped. Investigators worked quickly upon finding the body, ultimately tracking the source of the heroin back to Bey. Bey told at least one customer that anyone using his batch of heroin needed to “ease into it.” Moreover, after learning that someone died after using heroin sourced by him, Bey intended to continue to sell the deadly drug to others.
U.S. Attorney Weiss said, “Now more than ever, our law enforcement partners on the First State Opioid Taskforce are working together to hold accountable those who profit from the death of others.”
This case was investigated by the Drug Enforcement Administration and the New Castle County Police Department, and was prosecuted by Special Assistant U.S. Attorney Christopher L. de Barrena-Sarobe.
[1] Mr. Bey was charged in this case under his previous name, James Goodwyn.
Father and Son Among 18 Defendants Charged in Federal Investigation into Cocaine Delivery Service in Chicago AreaRead the Press Release
CHICAGO — A father and son are among 18 individuals facing criminal charges as part of a federal investigation into cocaine trafficking in the Chicago area.
During the multi-year investigation, dubbed “Operation Flawed Deal,” law enforcement seized multiple bank accounts, more than a kilogram of cocaine, a Mercedes G63 sport-utility vehicle, and two handguns, including one with an extended magazine. The defendants allegedly distributed cocaine to hundreds of customers in the Chicago area, with drivers dispatched to make door-to-door deliveries.
The investigation was conducted under the umbrella of the Organized Crime Drug Enforcement Task Force (OCDETF), a partnership between federal, state and local law enforcement agencies, whose principal mission is to identify, disrupt and dismantle the most serious drug trafficking organizations.
Two indictments unsealed this week in U.S. District Court in Chicago charge 18 defendants with federal drug offenses. Many of the defendants were arrested Thursday, and they have begun making initial appearances in federal court in Chicago.
The indictments were announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; Jeffrey S. Sallet, Special Agent-in-Charge of the Chicago office of the Federal Bureau of Investigation; Brian McKnight, Special Agent-in-Charge of the Chicago Field Division of the U.S. Drug Enforcement Administration; and Gabriel L. Grchan, Special Agent-in-Charge of the Internal Revenue Service Criminal Investigation Division in Chicago. Valuable assistance was provided by the Chicago Police Department, Evanston Police Department, Skokie Police Department, Lincolnwood Police Department, Palatine Police Department and Des Plaines Police Department. Assistant U.S. Attorneys Rajnath Laud and Charles W. Mulaney represent the government.
Fourteen defendants are charged in U.S.A. v. Usmani, et al (18 CR 835), including ANEES USMANI, also known as “Ace,” 41, of Chicago, and his brother, NAFEES USMANI, 39, of Lincolnwood. The Usmani brothers allegedly conspired with JUAN BAUTISTA DOMINGUEZ, 41, of Chicago, and several others to distribute at least 500 grams of cocaine in the Chicago area from the fall of 2017 to the spring of 2018. Also charged in the drug conspiracy are ALFONSO TROTTER, also known as “Fonz” and “Fonzie,” 48, of Chicago; RONALD ALLEN, 47, of Chicago; MUHAMMAD SABIH, also known as “Muhammad Iqbal” and “Sabih Nawab,” 30, of Chicago; MUHAMMAD BILAL KHAN, 24, of Chicago; AHMED FATAH KHAN MALIK, 24, of Skokie; ODEH ALSHOBAKI, 22, of Worth; AHMED HUSSEIN YOUSEF ALSAWALHI, 21, of Chicago; WESAM ABDEL FATTAH, 32, of Chicago; and LISA USMANI, 41, of Lincolnwood. Charged with cocaine distribution are KENNETH SLAUGHTER, 34, of Park Forest; and NEAL BOWENS, 47, of Gary, Ind. The indictment seeks forfeiture from ANEES USMANI of the Mercedes SUV and $247,700 in cash.
Dominguez and four other defendants are charged in U.S.A. v. Cayuela, et al (18 CR 836), including TONY F. CAYUELA, 64, of Chicago, and his son, TONY J. CAYUELA, also known as “Tone Kapone,” 39, of Chicago. The Cayuelas allegedly conspired with WALBERTO OLIVO, 46, of Chicago, to distribute at least 500 grams of cocaine in the Chicago area in the spring and summer of 2018. Dominguez and JESUS HERNANDEZ, 41, of Chicago, are charged in the indictment with possession of cocaine with intent to distribute. The indictment seeks forfeiture from Tony J. Cayuela of $108,000 in cash, two properties in the Brighton Park neighborhood of Chicago, and a property in the city’s Chicago Lawn neighborhood.
The charges in the indictments carry maximum penalties of 20 to 40 years in federal prison. If convicted, the Court must impose reasonable sentences under federal sentencing statutes and the advisory U.S. Sentencing Guidelines.
The public is reminded that charges contains only accusations and are not evidence of guilt. The defendants are presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.
Eleven U.S. Attorney Personnel Recognized for Outstanding PerformanceRead the Press Release
DAYTON – Benjamin C. Glassman, U.S. Attorney for the Southern District of Ohio, honored the work of eleven district employees by presenting them with the U.S. Attorney’s Awards for Outstanding Performance. Those honored are:
Outstanding Performance in Legal Support – Katie L. Shaw
Ms. Shaw has taken a leading role in providing excellent paralegal support for the office’s Civil Division in Columbus, including managing discovery and expert witnesses for a heavy case load of medical malpractice cases and other defensive matters. She also provided crucial support in an employment discrimination case defended by the U.S. Attorney’s Office for the Eastern District of Tennessee.
“Electronic discovery is overwhelmingly important to the effective conduct of litigation today,” Glassman said in presenting the award. “The office and the court system benefit immensely from Katie’s eDiscovery expertise and hard work in supporting the Civil Division’s daily efforts to protect the American fisc.”
Outstanding Performance by an Assistant United States Attorney – Emily N. Glatfelter
In 2018 Ms. Glatfelter was part of the team that indicted an alleged Chinese spy for economic espionage, and extradited him to the United States – a first for the Department of Justice. She was also part of the team that tried two individuals and a company for wire fraud. The trial lasted one month, received a lot of public attention, and resulted in the conviction of all defendants on all counts. She also serves as Deputy Criminal Chief of the Cincinnati office and in that capacity, she provides the kind of valuable support for cases tried by other attorneys. As one example, her input helped guide two trial attorneys she supervised to develop a wire fraud case into a nationwide racketeering indictment -- which people throughout the Department have called an innovative and effective use of the Racketeer Influenced and Corrupt Organizations (RICO) Act. She has also been a leader in developing and refining standard district-wide plea agreement documents, assuring consistency and accountability throughout the district.
“Emily is a force of nature,” Glassman said. “She is a relentless advocate for justice as a trial attorney, supervisor and innovative leader.”
Outstanding Performance by a Litigative Team – First Assistant U.S. Attorney Vipal J. Patel, Assistant U.S. Attorney Dominick S. Gerace II, Legal Administrative Specialist Leah A. Gezinski, Paralegal Specialist Catherine M. Robillard, Victim-Witness Specialist Acquanette M. Lindsay and Trial Attorney Justin Sher
This team litigated the first international terrorism case to go to trial in the Southern District of Ohio. It was an unprecedented undertaking with challenges involving discovery, translation, and secure handling of classified information that no trial team in the Southern District of Ohio had faced before.
“Working together as a team, they masterfully met those challenges and successfully brought the defendant to justice,” Glassman said, noting that Sher from the Justice Department’s National Security Division worked closely with other team members from the District who prepared discovery, managed the courtroom presentation, handled sensitive witness issues and tried the case.
Outstanding Performance in Administration – Jennifer T. Thornton
“Our cases affect the Southern District of Ohio, the nation, and the world,” Glassman said. “Jennifer has been principally responsible for making sure that work of the office is seen in the light of day, so the public understands what we’re doing to further the ends of justice and keep our communities safe.”
Ms. Thornton ensures that media have appropriate access to court documents and office leadership, proclaiming the work done on behalf of victims as well as protecting the rights of the accused. She has developed a strong social media presence and works with public information professionals in other agencies and Justice Department components to set and follow department-wide public information standards. Also serving as the District’s Outreach Coordinator, she manages a robust outreach program which included hosting the state’s third annual reentry summit in 2018 in partnership with the U.S. Attorney’s Office for the Northern District of Ohio.
Outstanding Performance by a Contractor – Noel A. Thesing
Ms. Thesing has been responsible for supporting the Cincinnati Civil Division’s affirmative cases, including investigations and litigation involving the False Claims Act, fair housing, Americans with Disabilities Act, and opioids. Her skill and enthusiasm have been significant assets as the office has expanded its affirmative civil practice. In affirmative civil rights cases, Ms. Thesing has handled not only traditional legal work, but has also interviewed witnesses, reviewed documents, and collected evidence.
“In 2018, our office brought its first Fair Housing Act case in decades against a landlord who sexually harassed female tenants,” Glassman said. “Noel’s work was crucial to bringing that case forward and now litigating it.”
Extraordinary Individual Contribution – Christy L. Muncy
The weekend before a trial was set to begin on a case involving the sex trafficking of a minor, one of the trial lawyers had to step away due to a family emergency. On receiving the call, Assistant U.S. Attorney Muncy literally went straight into the office that same weekend, dove into the case, and, together with the other trial lawyer already on the case, tried it the next week, ultimately resulting in convictions on all counts and prompting the district judge to praise both lawyers’ performance.
“That kind of devotion to the team and the cause, on the shortest possible notice and under difficult circumstances, is truly a remarkable individual contribution to the cause for justice and warrants this special recognition,” Glassman said.
The U.S. Attorney’s Office serves the approximately 5.5 million residents of 48 counties in Ohio and maintains offices in Columbus, Cincinnati and Dayton. This was Glassman’s third annual presentation of awards for outstanding performance. The event was held in Dayton.
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Eleven Individuals from Lagos, Nigeria Indicted for Conspiring to Commit Wire FraudRead the Press Release
Jacksonville, Florida – United States Attorney Maria Chapa Lopez announces the return of an indictment charging Badmus Yusuff Abayomi (29), Omo Oba Adekunle Abayomi (30), Yusuf Adesoji Adris (27), Abayomi Habeeb Ojo (25), Olaymei Afolabi Ojo (23), Akanni Fatai Olaiya (28), Seriki Abdulramon Oluwaseun (28), Adetayo Adekunle Oyemade (29), Edgar Ramos Ozil (34), Emmanuel Pius Osebomen (26), and Olaide Fatai Tijani (40), of Lagos, Nigeria, with conspiracy to commit wire fraud. If convicted, each faces a maximum penalty of 20 years in federal prison.
According to the
indictment , the defendants, all Nigerian citizens, targeted multiple U.S. corporations with “phishing” e-mails requesting that the companies’ payroll/human resources personnel send IRS Forms W-2, containing employee personal identifying information, for review. They used “spoofed” email addresses, which masked the actual email address, making it appear as if the message was sent from a high-level manager within the victim companies. Numerous companies around the United States were victimized by this sophisticated scheme, including a local Jacksonville-based business.The defendants, once they obtained the tens of thousands of employee W-2 Forms, used the information to file false federal income tax returns with the IRS claiming millions of dollars in fraudulent refunds. To receive the fraudulent tax refunds generated from the scheme, the defendants used individuals in the United States to accept the proceeds and send the money to Lagos, Nigeria. In many instances, the individuals assisting in the United States were victims of a romance scheme, whereby the defendants developed online relationships using fake social media platforms.
An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the Federal Bureau of Investigation Cyber Squad and Internal Revenue Service Criminal Investigation. It will be prosecuted by Assistant United States Attorney Jay Taylor.
District Man Sentenced to Five Years in Prison for Role in Drug Conspiracy Based in Northeast WashingtonRead the Press Release
WASHINGTON – Grady Jefferson, 46, of Washington, D.C., was sentenced today to five years on prison for conspiring to distribute heroin in the Washington, D.C. area.
The announcement was made by U.S. Attorney Jessie K. Liu, Nancy McNamara, Assistant Director in Charge of the FBI’s Washington Field Office, and Peter Newsham, Chief of the Metropolitan Police Department (MPD).
Jefferson pled guilty in September 2018, in the U.S. District Court for the District of Columbia, to a charge of conspiracy to distribute and possess with the intent to distribute 100 grams or more of heroin. The plea, which was subject to the Court’s approval, called for a five-year prison term. The Honorable Trevor N. McFadden accepted the plea and sentenced Jefferson accordingly. Following his prison term, Johnson will be placed on four years of supervised release.
Jefferson was among 12 people indicted in December 2017 following an investigation into a drug trafficking organization that distributed large amounts of heroin, methamphetamine, and crack cocaine in the Washington, D.C. metropolitan area. Ten other defendants have pleaded guilty. One defendant was convicted at trial before Judge McFadden in October 2018. One defendant is scheduled to begin trial before Judge McFadden on Jan. 8, 2018.
According to plea documents, law enforcement began investigating drug trafficking activities in the 2600 block of Birney Place SE in late 2015. The investigation expanded to include heroin distribution activities in the Lincoln Heights area of Northeast Washington. The FBI identified Jefferson as a regular heroin distributor operating out of Lincoln Heights. According to the government’s evidence, Jefferson was selling heroin on behalf of another defendant, Thomas Jenkins, 44, of District Heights, Md.
The prosecution grew out of the efforts of the FBI/MPD Safe Streets Task Force, a multi-agency team that conducts comprehensive, multi-level attacks on major drug trafficking and money laundering organizations. The prosecution was sponsored and supported by the federal Organized Crime Drug Enforcement Task Force (OCDETF).
In announcing the sentence, U.S. Attorney Liu, Assistant Director in Charge McNamara, and Chief Newsham commended the work of those who investigated the case from the Safe Streets Task Force, including the FBI, MPD, U.S. Park Police, Prince George's County, Md. Police, and the U.S. Bureau of Alcohol, Tobacco, and Firearms (ATF). They also expressed appreciation for the assistance provided by the U.S. Attorney’s Office for the District of Maryland.
Finally they cited the efforts of those who worked on the case from the U.S. Attorney’s Office for the District of Columbia, including Assistant U.S. Attorneys Nihar Mohanty and Kevin L. Rosenberg of the Violent Crime and Narcotics Trafficking Section, as well as Assistant U.S. Attorney Thomas Swanton, who assisted with the forfeiture aspects of the investigation.
District Man Sentenced to 37 Years in Prison for Shooting That Killed Innocent BystanderRead the Press Release
WASHINGTON – Kelby Gordon, 32, of Washington, D.C., was sentenced today to 37 years in prison for killing an innocent bystander and firing into an occupied bedroom during a broad-daylight shooting in Southeast Washington, announced U.S. Attorney Jessie K. Liu, Peter Newsham, Chief of the Metropolitan Police Department (MPD), and Nancy McNamara, Assistant Director in Charge of the FBI’s Washington Field Office.
Gordon was found guilty by a jury in July 2018 of second-degree murder while armed, assault with intent to kill while armed, and related firearms offenses. The verdict followed a trial in the Superior Court of the District of Columbia. He was sentenced by the Honorable Milton C. Lee. Following his prison term, he will be placed on five years of supervised release. In sentencing the defendant, Judge Lee called the crime a senseless and foolish act.
According to the government’s evidence, on March 24, 2016, at approximately 11:15 a.m., the victim, Gabriel Turner, was walking in a cut-through behind the 2600 block of Birney Place SE, headed to a nearby bus stop. Mr. Turner, 46, who had intellectual disabilities and who was working at the FBI as a janitor, had just finished having breakfast with his mother – as he had every morning. Gordon, meanwhile, was in the area and, after seeing another man pull out a large amount of money, decided to rob that man near the mouth of the cut-through.
However, as Gordon attempted to rob the man, the man began to pull out his own firearm. Gordon, in his own words, gave the man no chance, and pulled his gun out first. The two men began running down the cut-through behind Mr. Turner.
Unbeknownst to Mr. Turner, Gordon planted his feet and began firing towards the man, who fled in the same direction that Mr. Turner was walking. The man who Gordon was targeting weaved around Mr. Turner and escaped, but a single bullet struck Mr. Turner in the upper back as he ducked. The bullet lodged itself in Mr. Turner’s sinus – killing him almost instantly. Two other bullets flew into an occupied apartment across the street, just missing the head of a second victim as he returned to bed.
An investigation led to Gordon’s arrest on April 17, 2016, by the Capital Area Regional Fugitive Task Force. In addition to this case, Gordon has been charged with drug trafficking offenses in a separate matter in the U.S. District Court for the District of Columbia. He pled not guilty to those charges and that case remains pending.
In announcing the sentence, U.S. Attorney Liu, Chief Newsham, and Assistant Director in Charge McNamara commended the work of those who investigated the case from the Metropolitan Police Department (MPD), as well as the FBI/MPD Safe Streets Task Force and the FBI’s Cellular Analysis Survey Team, which helped identify Mr. Turner’s assailant. They also expressed appreciation for the assistance provided by the United States Park Police, the Capital Area Regional Fugitive Task Force, the United States Marshals Service, and the District of Columbia Department of Corrections.
They acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Victim/Witness Service Coordinators La June Thames and Katina Adams-Washington; Victim/Witness Advocate Jennifer Clark; Administrative Services Specialist Sallie Rynas; former Forensic Operation/Program Specialist Benjamin Kagan-Guthrie; Investigative Analyst Zachary McMenamin; Criminal Investigator John Marsh; Paralegal Specialists Lornce Applewhite and Jeffrey Bloom; Litigation Technology Specialist Thomas “Ron” Royal, and Assistant U.S. Attorney Emily A. Miller, who initially investigated the case.
Finally, they commended the work of Assistant U.S. Attorneys Lindsey Merikas and Monica Trigoso, who investigated and prosecuted the case.
District Man Sentenced to 20 Years in Prison for Killing Man in Broad Daylight in Southeast WashingtonRead the Press Release
WASHINGTON – Kevin Grover, 26, of Washington, D.C., was sentenced today to 20 years in prison for killing a man in broad daylight near a food market in Southeast Washington, announced U.S. Attorney Jessie K. Liu and Peter Newsham, Chief of the Metropolitan Police Department (MPD).
A second defendant, Justin Robinson, 19, also of Washington, D.C., was sentenced to five years in prison on a related charge.
Grover pled guilty in October 2018 to second-degree murder, and Robinson pled guilty to assault with intent to kill. Both pleas were in the Superior Court of the District of Columbia. The pleas, which were contingent upon the Court’s approval, called for Grover to be sentenced to 16 to 20 years in prison and for Robinson to be sentenced to three to seven years of incarceration. The Honorable Judith Bartnoff accepted the pleas and sentenced the men accordingly. Following their prison terms, each defendant will be placed on a period of supervised release: Grover, for five years, and Robinson, for three years.
According to the government’s evidence, on Feb. 24, 2016, at about 2:30 p.m., Robinson and the victim, Demetrius Medlay, bumped shoulders and briefly argued at a market in the 3100 block of Martin Luther King, Jr. Avenue SE. Robinson drove away, but returned to the area about 10 minutes later. He got out of the car holding a handgun with an extended magazine. While waving the gun, he argued with Mr. Medlay on the sidewalk and then drove off.
Robinson stopped the car at the corner of Martin Luther King Jr. Avenue and Esther Place SE at about 2:45 p.m. Grover was standing at the corner. Referring to Mr. Medlay, Robinson said, “You can smoke him,” to which Grover replied, “All right.”
Moments later, Grover pulled a semi-automatic firearm out of his pocket and pointed it at Mr. Medlay. He shot him twice in the chest. Grover fled the scene. Mr. Medlay ran back to the food market, where he collapsed. Mr. Medlay, 22, was pronounced dead a short time later.
A law enforcement investigation led to Grover’s arrest in August 2016. Robinson was arrested in in July 2017.
In announcing the sentences, U.S. Attorney Liu and Chief Newsham commended the work of those who investigated the case from the Metropolitan Police Department (MPD). They also expressed appreciation for the assistance provided by the U.S. Secret Service, the U.S. Marshals Service, the Capital Area Regional Fugitive Task Force, and the District of Columbia Department of Forensic Sciences. They acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Assistant U.S. Attorney Charles Willoughby, Jr., former Assistant U.S. Attorney Richard DiZinno, Paralegal Specialist Sharon Newman, former Paralegal Specialist Zekiah Wright, and Investigative Analyst Zachary McMenamin.
Finally, they commended the work of Assistant U.S. Attorney Jeffrey Nestler, who investigated and prosecuted the case.
District Man Sentenced to 20 Years in Prison for 2016 Stabbing in Southeast WashingtonRead the Press Release
WASHINGTON – Onzay Gibbs, 28, of Washington, D.C., was sentenced today to 20 years in prison on charges stemming from the stabbing of a man in Southeast Washington, U.S. Attorney Jessie K. Liu announced.
Gibbs was found guilty by a jury in May 2018 of assault with intent to kill while armed and aggravated assault while armed. The verdict followed a trial in the Superior Court of the District of Columbia. He was sentenced by the Honorable Ronna L. Beck. Following his prison term, Gibbs will be placed on five years of supervised release.
According to the government’s evidence, Gibbs and the victim knew each other from the neighborhood. At approximately 8:45 p.m. on Sept. 15, 2016, Gibbs and the victim were walking from a dice game in the 2000 block of Savannah Terrace SE towards the corner store. Gibbs stopped to talk with someone inside a car on 22nd Street SE, where the victim was then forced inside the car. The victim next recalled being around the corner in the 3300 block of 23rd Street SE, where Gibbs repeatedly slashed the victim with a sharp object while saying “shut the f*** up.” The victim was left for dead in bushes in the area, where he was found by someone who called 911.
The victim was rushed to a hospital in critical condition, where he was treated for 16 stab wounds to his face, neck, and body. He was cut three-fourths of the way around his neck. Text messages recovered from Gibbs’s cell phone showed his awareness of the victim’s condition and his efforts to avoid being identified and arrested following the incident.
Gibbs was arrested by the Capital Area Regional Fugitive Task Force on Oct. 26, 2016, and has been in custody ever since.
In announcing the sentence, U.S. Attorney Liu commended the work of those who investigated the case from the Metropolitan Police Department (MPD). She expressed appreciation for the assistance provided by the FBI’s Cellular Analysis Survey Team (CAST). She also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Assistant U.S. Attorneys C.B. Buente and Kevin L. Rosenberg, Criminal Investigator John Marsh, Paralegal Specialists Tiffany Fogle and Antoinette Sakamsa, and Victim/Witness Advocate Jennifer Allen. Finally, she commended the work of Assistant U.S. Attorneys Brittany Keil and Natasha Smalky, who prosecuted the case.
Des Moines Child Pornographer and Sex Abuser Sentenced to 40 Years in PrisonRead the Press Release
DES MOINES, IA – On December 7, 2018, Raymond Wayne Eugene Hall, age 33, was sentenced on federal child pornography charges to 40 years in federal prison and a life term of supervised release in the U.S. District Court for the Southern District of Iowa.
Hall, who resided in Des Moines, Iowa, pleaded guilty on June 11, 2018, to two counts of sexual exploitation of a minor, otherwise known as production of child pornography. Hall pleaded guilty to making child pornography with a hidden camera, he also admitted to making child pornography of another victim, namely recording himself engaged in various sex acts with the victim. Hall made some of the videos using his cell phone, and stored the child pornography on his personal laptop computer.
Hall’s sentence was enhanced by United States District Court Judge Rebecca Goodgame Ebinger due to his criminal history. He had previously been convicted in 2006 in Polk County, Iowa of sexual exploitation of children for collecting child pornography. As a consequence of the 2006 state court conviction, Hall was required to register on the Iowa Sex Offender Registry. His sentence was enhanced, in part, based on this prior conviction and his status as a registered sex offender.
“Prosecuting people who prey on children is one of the top priorities of our office,” stated United States Attorney Marc Krickbaum. “Raymond Hall is precisely the type of sexual predator we need to take off the street.” Krickbaum added, “we have strong partnerships established with federal, state, and local law enforcement agencies to provide maximum pursuit of child sexual predators. The Wayne County Sheriff’s Office became aware of Hall’s activities, partnered with the Iowa Department of Criminal Investigation, and then got federal authorities involved. This was a total team effort, and will keep the community safer for decades to come.”
The case was a joint federal-state-local effort, involving the Federal Bureau of Investigation’s Child Exploitation Task Force, the Iowa Department of Criminal Investigation’s Internet Crimes Against Children Task Force, the Wayne County Sheriff’s Office, and the Wayne County Attorney’s Office.
The case was prosecuted by the United States Attorney’s Office for the Southern District of Iowa as part of the United States Department of Justice’s “Project Safe Childhood” initiative, which was started in 2006 as a nation-wide effort to combine law enforcement investigations and prosecutions, community action, and public awareness in order to reduce the incidence of sexual exploitation of children.
Any persons having knowledge of a child being sexually abused are encouraged to call the Iowa Sexual Abuse Hotline at 1-800-284-7821.
Defendant in Expanding Cocaine Conspiracy Involving Weapons Stockpile Sentenced to 135 MonthsRead the Press Release
NEWS RELEASE SUMMARY – December 14, 2018
SAN DIEGO – Juan A. Mexicano, aged 33, was sentenced today in federal court by U.S. District Judge Gonzalo P. Curiel to 135 months in custody. Mexicano previously pled guilty, admitting his role in an expanding cocaine distribution conspiracy, extending from Guatemala and Mexico to San Diego and Chicago, that involved the seizure of grenades, .50 caliber firearms, assault weapons and other firearms.
In his plea agreement, Mexicano admitted to maintaining a narcotics stash house in Illinois that he used to distribute cocaine from a Mexican-based trafficker, identified in court documents as “El 99”. Mexicano also acknowledged that he made arrangements to import cocaine through the Southern District of California and that he possessed weapons seized from a storage facility in Illinois. The weapons included two hand grenades; a grenade launcher; five .50 caliber weapons; one .22 handgun with a silencer; 26 other assault style weapons, including a submachine gun; more than 1,000 rounds of ammunition; and six ballistic vests. During sentencing, Judge Curiel noted “this catalog of armaments was capable of mass destruction” and that these weapons “evidence[d] the danger to the community that this group of drug traffickers posed to the community in Illinois.”
Mexicano, who is the fourth defendant to be sentenced in the case, further admitted that the stash house near Chicago was used for the temporary storage of cocaine and acknowledged that up to approximately 150 kilograms (approximately 330 pounds) of cocaine was stored there.
As part of its sentence, the court credited Mexicano with 15 months, for time served in state custody. Mexicano also faces sentencing on January 4, 2019, in connection with his separate guilty plea to charges in Kane County, Illinois (Case No. 17CF1720) related to the weapons stockpile.
“I am grateful for the efforts of our law enforcement partners to remove these dangerous narcotics and weapons from our communities and out of the hands of violent drug dealers,” said U.S. Attorney Adam Braverman. “We are committed to stopping the traffickers, whose sole aim is to profit from human misery.”
“Today’s sentencing of Mexicano is the example of the great collaborative effort of law enforcement and prosecutors to bring to justice those who endanger our communities with illicit drugs and dangerous weapons.” said David Shaw, Special Agent in Charge of Homeland Security Investigations in San Diego. “This investigation demonstrates that these types of criminals, who facilitate the movement of contraband for transnational criminal organizations will be pursued by law enforcement and held accountable for their actions.”
In addition to Mexicano, other defendants who have entered guilty pleas in the federal case are: Walter Rovidio Ipina, aged 40; David Castaneda-Solis, aged 33; Zachary Vasquez, aged 27; and Jacob Castillo, aged 48. Only Vasquez remains to be sentenced.
Through his plea agreement, Ipina admitted that, during 2016, he moved the cocaine provided by “El 99” through the Southern District of California by using his family owned trucking business’ tractor-trailer to transport the cocaine from Southern California to the Chicago, Illinois area. In September 2016, he was stopped by law enforcement with 32 kilograms of cocaine. Ipina was sentenced to 50-months in custody by Judge Curiel on August 3, 2018.
Castaneda-Solis pleaded guilty to laundering narcotics proceeds. On August 12, 2016, Castaneda-Solis was caught by law enforcement while he was unloading $154,000 in narcotics proceeds from a hidden compartment in the dashboard of a Honda Pilot vehicle. Castaneda-Solis admitted that he placed these proceeds into a black bag for delivery to Mexico. Castaneda-Solis was sentenced to 70 months in custody by Judge Curiel on October 3, 2018.
Vasquez pleaded guilty to the cocaine conspiracy and admitted that he served as a narcotics load coordinator/recruiter. He admitted to coordinating with “El 99” in Mexico. Vasquez also admitted to recruiting and supervising a driver who smuggled cocaine through the San Ysidro Port of Entry on at least four occasions before that driver was arrested. Vasquez admitted that the scope of his involvement in the conspiracy included trafficking beteween 125 to 150 kilograms of cocaine. Vasquez is scheduled for sentencing on March 15, 2019.
Castillo-Lopez pleaded guilty to laundering narcotics proceeds. In his plea agreement, he admitted to using bulk currency to purchase trucks and other vehicles that he arranged to export to benefit narcotics traffickers in Guatemala. Castillo-Lopez was sentenced to 33 months in custody by Judge Curiel on November 2, 2018.
This case is the result of the ongoing efforts by the Organized Crime Drug Enforcement Task Force (OCDETF) a partnership that brings together the combined expertise and unique abilities of federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt, dismantle and prosecute high level members of drug trafficking, weapons trafficking and money laundering organizations and enterprises.
The United States is represented in court by Assistant U.S. Attorney Lawrence A. Casper.
DEFENDANTS Case Number 17-cr-648
Juan A. Mexicano Age: 33 Addison, IL
Walter R. Ipina Age: 40 Victorville, CA
David Castaneda-Solis Age: 34 Mexico
Zachary Vasquez Age: 27 Anaheim, CA
Jacob Castillo-Lopez Age: 48 Guatemala
SUMMARY OF CHARGES TO WHICH GUILTY PLEAS ENTERED
Mexicano, Ipina & Vasquez
Conspiracy to Unlawfully Distribute Cocaine, 21 U.S.C. § 846
Maximum penalty: Life in prison, and a mandatory minimum 10 years; $10,000,000 fine; and at least five years’ supervised release up to life.
Castaneda-Solis & Castillo-Lopez
Conspiracy to Launder Monetary Instruments, 18 U.S.C. § 1956(h)
Maximum penalty: 20 years custody; 3 years supervised release; and $500,000 fine.
INVESTIGATING AGENCIES
Homeland Security Investigations
Bureau of Alcohol Tobacco Firearms and Explosives
Ventura County, CA Sheriff’s Office
Police Departments of: Elgin, IL; Addison, IL.; Chicago, IL; Hoffman Estates, IL;
New Lenox, IL; Olympia Fields, IL; Streamwood, IL; and Lombard, IL
Sheriff’s Offices of: Kane County, IL; DuPage County, IL; Will County, IL
DEA and Pasco Sheriff’s Office Seize over A Kilogram of Suspected Fentanyl, $400,000 in Cash, and Multiple Firearms from Suspected Fentanyl TraffickersRead the Press Release
Tampa, FL – United States Attorney Maria Chapa Lopez announces an the return of an indictment charging Edwin Tyron Hill, a/k/a “Z,” (47, Holiday), and William Gaston (31, Port Richey) with conspiring to distribute one kilogram or more of heroin and 400 grams or more of fentanyl, and distribution of heroin and fentanyl. Hill is also charged with possession of firearms in furtherance of drug trafficking crime. A third individual, Nelson White, a/k/a “Slug” (27, Holiday), was also arrested in this case and has been charged with conspiracy. If convicted, Hill faces a minimum mandatory penalty of 15 years, and up to life, in federal prison. Gaston and White each face a minimum mandatory of 10 years, and up to life, imprisonment. The indictment also notifies the defendants that the United States intends to forfeit over $400,000 in cash and three firearms, which are alleged to be proceeds of, or used in furtherance of, the offenses. Further, the United States has notified Hill that it intends to forfeit his house in Pasco County.
According to court document, in late September 2018, the DEA executed search warrants in two locations linked to Hill, which resulted in substantial drug, cash, and firearm seizures. That same day, agents also conducted a traffic stop of Hill’s associate, Nelson White, resulting in an additional substantial seizure of drugs, cash, firearms, and ammunition.
An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the Drug Enforcement Administration and the Pasco Sheriff’s Office. It will be prosecuted by Assistant United States Attorney Dan Baeza.
Columbia Falls man admits government benefits fraudRead the Press Release
MISSOULA—A Columbia Falls man accused of stealing government benefits by overstating his disabilities admitted fraud and theft charges in federal court on Dec. 12, U.S. Attorney Kurt G. Alme said.
John Cicero Hughes, 46, pleaded guilty to theft of government money and Social Security disability insurance fraud.
U.S. Magistrate Judge Jeremiah C. Lynch presided and will recommend that Hughes’ plea be accepted by U.S. District Judge Dana Christensen, who is assigned to case.
Hughes faces a maximum 10 years in prison, a $250,000 fine and three years of supervised release. Sentencing is set for April 12, 2019. Hughes is released.
The government intends to seek restitution for the Veterans Administration and the Social Security Administration for an estimated loss totaling $830,061, with the understanding that Hughes will dispute that figure and that a judge ultimately will determine loss and restitution before imposing sentence.
If the case had proceeded to trial, the government would have presented the following information as evidence:
Hughes, a Navy veteran, was determined in 2009 to be 100 percent disabled by the VA based on confirmation of a prior diagnosis that he suffered from multiple sclerosis. Hughes represented he had total loss of both hands and feet in addition to other maladies. From 2009 through July 2018, Hughes received more than $7,000 a month from the VA.
In addition, because the VA had rated Hughes 100 percent disabled, he qualified for SS disability insurance benefits. The Social Security Administration paid Hughes and some of his family members about $1,400 a month from 2009 until the present.
During the nine-year period, Hughes misrepresented the nature and extent of his disabilities to VA doctors and other health professionals by claiming he could not drive or walk more than a few steps, had double vision, had little to no feeling in his left arm and leg, could not shop for himself or prepare his own meals and was essentially bound to either his bed or a motorized wheelchair.
An investigation found that Hughes drastically overstated his symptoms and limitations. In June 2017, the VA and SSA began an investigation into the extent of Hughes’ disability, which culminated in a Compensation and Pension Examination on Jan. 23, 2018 in Helena.
During the examination, Hughes claimed he had not driven since 2008 without adaptive equipment and did not drive to Helena for the appointment. He said he could not walk more than a few steps and chose to remain in a wheelchair during the entire exam. He also said he could not shop for himself, was essentially house-bound, had almost no feeling in his left arm and leg and could not open his left hand because of spasticity caused by MS.
Unbeknownst to Hughes, law enforcement officers surveilled Hughes when he arrived for the appointment, recorded and monitored the entire exam and surveilled him when he left the VA. Officers saw Hughes drive himself to the appointment in a truck with no adaptive equipment and walk into and out of the VA. Hughes then drove himself around Helena, running errands, including walking with a cane around a grocery store and using both hands to play machines at a local casino.
Agents also surveilled Hughes’ activities in the Flathead Valley in 2017. Agents saw Hughes drive a car and a Harley Davidson motorcycle several times, walk distances he had claimed for years he could not cover and do chores, including climbing a ladder during a snowstorm to brush snow off the roof of a recreational vehicle.
On Aug. 1, 2017, Hughes received a direct deposit of $7,056 from the VA into his bank account. The same day, agents observed Hughes drive his motorcycle to and from a car wash and walk about 50 feet without a cane.
When agents interviewed Hughes at his residence in February 2018, he stuck to his story about the extent of his disabilities but admitted to driving a motorcycle in the summer of 2017 and to driving to the VA exam in January. He eventually admitted to making some misrepresentations to the examiner at the VA and told the agents, “If it was wrong, it was wrong.”
Assistant U.S. Attorney Timothy Racicot is prosecuting the case, which was investigated by VA’s and SSA’s Offices of Inspector General.
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Colorado Men Charged with Meth and Gun CrimesRead the Press Release
United States Attorney Ron Parsons announced that two Colorado Springs, Colorado, men were charged in federal district court with Possession with Intent to Distribute a Controlled Substance and Possession of a Firearm by a Prohibited Person.
Billy Torrez, age 23, and Joshua Cruz, age 29, were indicted by a federal grand jury on December 4, 2018. Torrez and Cruz appeared before U.S. Magistrate Judge Daneta Wollmann and pleaded not guilty to the charges. The penalty upon conviction is a minimum of 5 years up to 40 years in federal prison and/or a $5,000,000 fine, a minimum of 4 years up to lifetime supervised release, and a $100 assessment to the Federal Crime Victims Fund.
The charges relate to Torrez and Cruz being found in possession of methamphetamine, heroin, and three guns in Rapid City on November 21, 2018. After attempting to flee in a vehicle, they were quickly apprehended by the Rapid City Police Department. The charges are merely accusations and Torrez and Cruz are presumed innocent until and unless proven guilty.
Drug trafficking is an inherently violent activity. Firearms are tools of the trade for drug dealers. It is common to find drug traffickers armed with guns in order to protect their illegal drug product and cash, and enforce their illegal operations.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of its renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and local communities to develop effective, locally-based strategies to reduce violent crime.
The investigation is being conducted by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Rapid City Police Department. Assistant U.S. Attorney Ben Patterson is prosecuting the case.
Torrez and Cruz were detained pending trial. A trial date has not been set.
Colombian Fugitive Extradited to United States to Face Charges for International Cocaine Distribution ConspiracyRead the Press Release
Carlos Andres Gallo Rodriguez was arraigned today in federal court in Brooklyn before United States Magistrate Judge Steven L. Tiscione on an indictment charging him with conspiring to import and distribute cocaine into the United States. The defendant was arrested in Colombia on a provisional arrest request from the United States and subsequently extradited from Colombia to the United States on December 13, 2018. Magistrate Judge Tiscione ordered Gallo Rodriguez detained pending trial.
Richard P. Donoghue, United States Attorney for the Eastern District of New York, and Ray Donovan, Special Agent-in-Charge, Drug Enforcement Administration, New York Division (DEA), announced the extradition and charges.
“As alleged, the defendant conspired with others to import a massive amount of cocaine that would be distributed in the United States, endangering countless lives,” stated United States Attorney Donoghue. “This Office is committed to working closely with our partners here and abroad to dismantle drug networks and bring traffickers to justice.” Mr. Donoghue extended his grateful appreciation to the DEA offices on Long Island and in Mexico City, the United States Department of State, and the Homeland Security Investigations (HSI) Office in Tucson, Arizona. Mr. Donoghue also expressed his appreciation to the United States Marshals Service (USMS), the DEA Cartagena Country Office, the Colombian National Police and the Government of Colombia.
“Drug traffickers’ ingenuity in smuggling methods never ceases to amaze me,” stated DEA Special Agent-in-Charge Donovan. “DEA has seen drugs concealed in hundreds of ways, for example: furniture, machinery, produce, wheelchairs, puppies and in this case rubber-encased steel bumpers. This arrest and extradition is a message to drug suppliers overseas that law enforcement is committed to bringing to justice those responsible for flooding our streets with illegal drugs.”
According to the extradition affidavit, Gallo Rodriguez organized the shipment of approximately two tons of cocaine from Colombia to Mexico, with its ultimate distribution to be in the United States. In December 2016, law enforcement authorities seized the cocaine at a warehouse owned by Gallo Rodriguez in Sibate, Colombia. The cocaine was hidden inside rubber-encased steel bumpers, which are commonly used on shipping vessels. Gallo Rodriguez oversaw the importation of rubber from Mexico and the preparation of the steel bumpers containing the cocaine. He also documented the shipment to appear to be a legitimate commercial import-export transaction.
The investigation was led by the New York Strike Force, a crime-fighting unit comprising federal, state and local law enforcement agencies supported by the Organized Crime Drug Enforcement Task Force and the New York/New Jersey High Intensity Drug Trafficking Area. The Strike Force is based at the DEA’s New York Division and includes agents and officers of the DEA, New York City Police Department, New York State Police, HSI, U.S. Internal Revenue Service Criminal Investigation Division, Bureau of Alcohol, Tobacco, Firearms and Explosives, U.S. Customs and Border Protection, U.S. Secret Service, USMS, New York National Guard, Clarkstown Police Department, U.S. Coast Guard, Port Washington Police Department and New York State Department of Corrections and Community Supervision.
The charges in the indictment are allegations and the defendant is presumed innocent unless and until proven guilty. If convicted of the crimes charged, the defendant faces a mandatory minimum sentence of 10 years’ imprisonment and up to life imprisonment.
The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section. The Justice Department’s Office of International Affairs handled the extradition in this matter. Assistant United States Attorneys Soumya Dayananda and Erin Reid are in charge of the prosecution.
The Defendant:
CARLOS ANDRES GALLO RODRIGUEZ
Age: 39
ColombiaE.D.N.Y. Docket No. 17-CR-213 (MJB)
Chinese National Who Threatened to Shoot School Children Pleads Guilty to Gun and ID Theft ChargesRead the Press Release
HOUSTON - A 22-year-old Chinese national who resided in La Marque has admitted to possessing a firearm while being an illegal alien and to aggravated identity theft, announced U.S. Attorney Ryan Patrick along with Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) Special Agent in Charge Mark Dawson and Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) Special Agent in Charge Fred Milanowski.
Xiangyu Zhang remained in the United States two years after his visa expired. He came to law enforcement’s attention in July 2018 when he entered an internet chat session on the Department of Veteran’s Affairs (VA) Crisis Line and threated to kill school children by using firearms. Zhang is a not a U.S. veteran.
“We believed that this individual presented a real danger to the community based on the threats that he made to the Veteran’s Crisis Hotline,” said Dawson. “Within days of being alerted to those threats, our special agents were able to conduct their investigation, secure an arrest warrant and locate and arrest the subject before he had the opportunity to harm anyone.”
Law enforcement arrested him at a gas station located close to his residence. At that time, he was sitting in a vehicle in possession of two firearms, including an AM-15 rifle. Both firearms had rounds in the chamber.
“Holding people responsible for unlawfully being in possession of firearms and fighting violent crime remains at the forefront of the ATF mission,” said Milanowski. “Working with our partners at HSI to become a force multiplier will ensure our community is safe.”
Upon Zhang’s arrest, law enforcement also found a passport belonging to a woman who lived in the Dallas area. Zhang had stolen the woman’s purse containing the passport in August 2017 after he served as her Uber driver. Within hours of stealing her purse, Zhang, while using the woman’s identity without her permission, attempted to purchase several high end items online from Apple.
Law enforcement also found a picture of a fake U.S. passport page with Zhang’s picture and the woman’s passport number on Zhang’s phone.
A few months after stealing the purse, Zhang defrauded Bank of America in March 2018 for more than $11,000. In late June 2018, and a few days before making those threats on the VA chat line, Zhang stole an IRS refund check from his neighbor’s mailbox and deposited it into his bank account.
U.S. District Judge Gray Miller accepted Zhang’s pleas today and set sentencing for March 19, 2019. At that time, he faces up to 10 years imprisonment and a maximum $250,000 fine for the firearm possession charge. He also faces a mandatory two years for the identity theft which must be served consecutively to any other prison term imposed.
He has been and will remain in custody pending that hearing.
HSI and ATF conducted the investigation. Assistant U.S. Attorney Alamdar Hamdani is prosecuting the case.
Canadian Man Charged with Leading Police on A High Speed Chase and Assaulting an OfficerRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y.—U.S. Attorney James P. Kennedy, Jr. announced today that Feng Chen, 23, of Ontario, Canada, was arrested and charged by criminal complaint with assaulting a federal officer by means of a dangerous weapon, evading a checkpoint operated by a Federal law enforcement agency in a motor vehicle in excess of the legal speed limit, and with eluding inspection by immigration officials. The charges carry a maximum penalty of 25 years in prison and a $250,000 fine.
Assistant U.S. Attorney Aaron J. Mango, who is handling the case, stated that on December 10, 2018, at approximately 2:30 p.m., the defendant was attempting to enter the United States at the Lewiston Bridge Port of Entry. Chen turned over his passport when it was requested by a Customs and Border Protection officer. However, when the officer asked the defendant for his citizenship and destination, he did not answer the questions, and then sped through the inspection checkpoint.
The officer called out “port runner” over the radio, and a CBP officer began pursuing Chen’s vehicle, in a marked unit, with emergency lights and sirens activated. During the course of the chase, the defendant was weaving in and out of traffic at an unsafe speed. The pursuit continued on to Grand Island, where a New York State Police unit, with activated emergency lights, entered the roadway in front of Chen’s vehicle in an attempt to stop it. Rather than stop, the defendant struck the rear of the New York State Police vehicle at a high rate of speed, and the came to a stop.
Following the collision, Chen failed to comply with a CBP officer’s commands. As the officer attempted to remove the defendant from his vehicle, Chen struck and punched the CBP officer with his fist, near the officer’s left eye, resulting in an abrasion on the side of officer’s face. The defendant was then transported to Mt. Saint Mary’s Hospital in Lewiston, NY.
Based on immigration record checks, the defendant has no valid immigration status in the United States and is present illegally in the United States in violation of the Immigration and Nationality Act.
“Border security is essential to our very existence as a Nation,” stated U.S. Attorney Kennedy. “We, together with our state and local partners, remain vigilant and committed to protecting our citizens and upholding the rule of law not only within our country but also at its borders.”
“Our officers and state partners did an excellent job ensuring this port runner was apprehended. If you attempt to enter the U.S without inspection we will pursue and apprehend you,” said CBP Buffalo Field Office Director ose Brophy. “Border security is paramount to our country's safety and it starts with ensuring everyone is properly inspected at the border. I’d like to thank the New York State Police for assisting our officers in the apprehension of the subject.”
The defendant made an initial appearance before U.S. Magistrate Judge Michael J. Roemer and is being held pending a detention hearing scheduled for December 18, 2018, at 12:00 p.m.
The complaint is the result of investigation by Homeland Security investigations, under the direction of Special Agent-in-Charge Kevin Kelly; U.S. Customs and Border Protection, under the direction of Director of Field Operations Rose Brophy; and the New York State Police, under the direction of Major Edward Kennedy.
The fact that a defendant has been charged with a crime is merely an accusation, and the defendants are presumed innocent until and unless proven guilty.
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California Resident Sentenced to Five Years in Prison for ATM Skimming Fraud SchemeRead the Press Release
LAS VEGAS, Nev. – A California man who possessed and used over 500 fraudulent credit and debit cards throughout the Las Vegas Valley was sentenced Thursday to 60 months in prison, announced U.S. Attorney’s Office Dayle Elieson for the District of Nevada.
Khachatur Zakaryan, 37, of California, pleaded guilty without the benefit of a plea agreement to one count of possession of 15 or more counterfeit or unauthorized access devices, four counts of producing, using, or trafficking in a counterfeit access device, and four counts of aggravated identity theft. In addition to the prison term, U.S. District Judge Andrew P. Gordon ordered him to serve a three year term of supervised release.
In February 2017, Zakaryan and unnamed coconspirators possessed counterfeit prepaid and gift debit cards encoded with stolen account numbers and account information. He drove to multiple ATM machines throughout the Las Vegas Valley to fraudulently withdraw cash advances from the stolen bank accounts. He fraudulently conducted cash outs at ATM machines at different locations within a short amount of time.
During a search of Zakaryan’s van and hotel rooms, officers found a total of 521 fraudulent cards. At the time of his arrest, officers found an additional nine fraudulent cards in Zakaryan’s possession.
At the time of this offense, Zakaryan was on probation in a state felony case for similar conduct with counterfeit credit/debit cards.
Zakaryan still faces pending charges for ATM skimming and fraud crimes in the state of North Carolina during the same approximate time period.
The case was investigated by the FBI’s Las Vegas Cyber Crimes Task Force and the Henderson Police Department. Assistant U.S. Attorney Patrick Burns prosecuted the case.
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Business Owner Who Conspired with Former Baltimore City Employee to Extort Bribes from Other Business Owners Ordered to Pay $100,000 FineRead the Press Release
Baltimore, Maryland – U.S. District Judge Catherine C. Blake today ordered Jerome Walter Stephens, age 48, of Baltimore, to pay a $100,000 fine, and sentenced him to serve six months in community confinement and six months in home detention as part of three years of probation, for Extortion Under Color of Official Right related to an extortion scheme. Judge Blake also ordered Stephens to perform 100 hours of community service. Stephens, the owner of a Baltimore construction and utilities company, admitted paying bribes to co-defendant Daryl Christopher Wade, age 50, of Rosedale, Maryland, a former Baltimore City Department of Transportation supervisor, and to soliciting bribes from others.
On November 9, 2018, Judge Blake sentenced Daryl Christopher Wade to 15 months in prison, followed by three years of supervised release, for the same charge.
The sentences were announced by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge Gordon B. Johnson of the Federal Bureau of Investigation, Baltimore Field Office; and Inspector General Isabel M. Cumming of the Baltimore City Office of Inspector General.
The people of Baltimore expect and deserve integrity from their public officials. We will hold them, and those who participate in corruption, accountable,” said United States Attorney Robert K. Hur.
Wade was a City of Baltimore employee between 1988 through 2017, most recently with the Baltimore City Department of Transportation (DOT) as a Construction Project Supervisor II within the DOT’s Street Cut Unit. The DOT Street Cut Unit helps to monitor and administer fines associated with street cuts and street cut permits. According to the criminal information and the plea agreement, Wade used his official position at DOT to claim that he could void street cut fines in return for payments.
According to their plea agreements, Wade accepted multiple cash payments, including from Stephens, in exchange for claiming that he could erase Baltimore DOT street cut fines. Baltimore City street cut permits are required for companies who need to impede into a public street, alley, sidewalk, or other right-of-way for purposes of construction. The street cut permits are valid for 120 days before they expire, and DOT will assess a fine of $50 per day for each street cut not repaired past the expiration date.
Stephens and Wade admitted that they either attempted to or actually did extort other business owners throughout Baltimore. In one such instance, Person A was the Vice President of a Virginia-based company that provided all phases of underground utility construction and sewer rehabilitation throughout the East Coast and had approximately $55 million in contracts with the City of Baltimore to restore and/or replace water and sewer lines in the City. In order to complete those contracts, Person A's company conducted street cuts to reach, restore, and/or replace water and sewer lines in Baltimore.
In January 2016, Person A met with Stephens at one of Person A’s offices, in Prince George’s County, Maryland. Stephens told Person A that Person A’s company would be receiving $1.3 million in street cut fines from the street cuts unit in the near future. This was the first that Person A had learned of the $1.3 million in prospective fines. Stephens told Person A that he had a connection in the street cuts unit that could reduce the $1.3 million in fines by 80%, to $260,000, if Person A paid 20%, a $52,000 bribe, to Stephens’s connection. Stephens also stated something to the effect of: if you want to play, you got to pay. Person A made clear that he was not interested in paying the $52,000 bribe and would sue the City of Baltimore over the fines if necessary.
In another instance to which both Stephens and Wade admitted in their respective plea agreements, in February 2016, Person B, a local Baltimore business owner, began renovations on a restaurant in Baltimore, Maryland. Person B hired Stephens to overhaul the water lines into Person B’s business. In July 2016, Stephens informed Person B that he (Stephens) would have to cut into the road. Stephens informed Person B that the complete repaving, from curb to curb, had an estimated additional cost to Person B of between approximately $10,000 to approximately $12,000 but said he had a connection "downtown" in the City of Baltimore who could save Person B on the costs associated with completely repaving if Person B was willing to pay a bribe. Due to Person B's limited budget, and the fact that the street had already been cut, Person B agreed to pay a bribe to repave the smaller sections of the road. Stephens and Wade discussed how much Wade would accept and Wade agreed to a $2,200 bribe. Person B gave Stephens $2,200 in cash, which Stephens then gave to Wade.
Finally, according to Wade’s plea agreement, he also took a bribe from Person C, who ran a plumbing and drain construction business in Baltimore, Maryland. Person C was previously fined approximately $17,000 for street cuts in Baltimore City. In March 2016, Person C attended a Baltimore City street cut appeal hearing regarding the fine. Wade stopped the hearing and requested to speak with Person C outside the hearing. Once outside the hearing, Wade explained to Person C that if Person C helped Wade that he would help Person C.
In early September 2016, Wade met in-person with Person C and agreed to accept $5,000 to remove the fine. On September 22, 2016, Person C paid Wade the first $3,000 in cash. Wade arrived at the meeting driving a Baltimore City issued government vehicle. At the direction of Wade, Person C threw the $3,000 into Wade’s Baltimore City government vehicle. After the money was in his Baltimore City government vehicle, Wade stated “you good for life with me. . . .” and later laughed and further stated to Person C, “we in cahoots now. . . .”
United States Attorney Robert K. Hur commended the FBI and Baltimore City Office of Inspector General for their work in the investigation. Mr. Hur thanked Assistant U.S. Attorney Leo Wise, who prosecuted the case.
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