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Wednesday 8 August 2018
Oklahoma City Man Indicted for Producing and Receiving Child PornographyRead the Press Release
Oklahoma City – RICHARD SPILLANE, 30, of Oklahoma City, was indicted yesterday on charges of producing and receiving child pornography, announced Robert J. Troester, Acting United States Attorney for the Western District of Oklahoma.
According to a complaint filed on July 16, 2018, law enforcement officers determined that an internet user with an email address linked to Mr. Spillane was engaging in conversations and sharing photographs depicting children engaged in sexually explicit conduct on a network often used to receive and distribute child pornography. Mr. Spillane was arrested on July 17, 2018, and has remained in federal custody since his arrest.
On August 7, 2018, a federal grand jury returned a six-count indictment charging Mr. Spillane with two counts of producing child pornography and four counts of knowingly receiving child pornography. According to the indictment, between approximately October 15, 2017, and July 17, 2018, Mr. Spillane used two minors, "John Doe #1" and "John Doe #2," to produce photographs of the children engaging in sexually explicit conduct. It is also alleged that he received images of children engaging in sexually explicit conduct, via the internet, on four specific days in June and July of this year.
If convicted, Mr. Spillane faces a mandatory minimum of 15 years and up to 30 years in prison on each of the two production counts, as well as a mandatory minimum of five years and up to 20 years in prison on each of the counts alleging receipt of child pornography. All charges also carry a maximum $250,000 fine, along with a term of supervised release of at least five years and up to life.
Reference is made to court records for further information. The public is reminded that the charges in the indictment are only allegations and that Mr. Spillane is presumed innocent unless and until proven guilty beyond a reasonable doubt.
This case is the result of an investigation by the Federal Bureau of Investigation and is being prosecuted by Assistant U.S. Attorney Julia E. Barry.
Norwich Cocaine Distributor Pleads GuiltyRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that JOSEPH BARROS, 37, of Norwich, waived his right to be indicted and pleaded guilty today in New Haven federal court to one count of conspiracy to distribute and to possess with intent to distribute cocaine.
According to court documents and statements made in court, in June 2017, law enforcement received information that BARROS was distributing cocaine and other drugs in southeastern Connecticut. Investigators made three controlled purchases of cocaine from BARROS, and a wiretap investigation revealed that BARROS was supplying cocaine to local distributors. BARROS was arrested on December 21, 2017.
BARROS is scheduled to be sentenced by U.S. District Judge Alvin W. Thompson in Hartford on October 31, 2018, at which time he faces a maximum term of imprisonment of 20 years. BARROS is released on a $50,000 bond pending sentencing.
This matter is being investigated by the New London FBI Task Force with the assistance of the Norwich Police Department. The case is being prosecuted by Assistant U.S. Attorney David C. Nelson.
North Carolina Tax Return Preparer Pleads Guilty to Conspiring to File False Tax ReturnsRead the Press Release
A Winston-Salem, North Carolina resident pleaded guilty today to conspiring to defraud the United States by filing false tax returns, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G. T. Martin of the Middle District of North Carolina.
According to court documents, Claudia Lynette Shivers conspired with others to defraud the Internal Revenue Service (IRS) by preparing false tax returns. Shivers co-owned and operated two tax return preparation businesses: Fast Tax of Winston-Salem, Inc. in Winston-Salem and Quick Taxes LLC in Greensboro. Shivers and her co-conspirators falsified items on clients’ tax returns, such as dependents and Schedule A deductions, in order to fraudulently maximize their refunds. Shivers also directed clients to hand-write false information on tax forms and other documents used in the preparation of their returns. Shivers further admitted that she held training sessions for her employees, during which she would instruct them on how to manipulate the information on tax returns in order to obtain refunds to which the clients were not entitled. Between January 2014 and April 2017, Shivers and her co-conspirators prepared approximately 519 false tax returns, which claimed approximately $1.3 million in bogus refunds.
Shivers’ sentencing is scheduled for December 20, 2018. Shivers faces a statutory maximum sentence of five years in prison, as well as a period of supervised release, restitution and monetary penalties.
Shiver’s co-conspirators, Shannon DeWayne Patterson, Kristyn Dion Daney, and Rakeem Lenell Scales, have all pleaded guilty to charges of aiding and assisting in the preparation of false tax returns and are awaiting sentencing.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin commended special agents of IRS Criminal Investigation, who conducted the investigation, and Trial Attorneys Robert J. Boudreau and Lauren Castaldi of the Tax Division and Criminal Division Chief Clifton T. Barrett of the Middle District of North Carolina, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
North Carolina Tax Return Preparer Pleads Guilty to Conspiring to File False Tax ReturnsRead the Press Release
WASHINGTON – A Winston-Salem, North Carolina resident pleaded guilty today to conspiring to defraud the United States by filing false tax returns, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G. T. Martin of the Middle District of North Carolina.
According to court documents, Claudia Lynette Shivers conspired with others to defraud the Internal Revenue Service (IRS) by preparing false tax returns. Shivers co-owned and operated two tax return preparation businesses: Fast Tax of Winston-Salem, Inc. in Winston-Salem and Quick Taxes LLC in Greensboro. Shivers and her co-conspirators falsified items on clients’ tax returns, such as dependents and Schedule A deductions, in order to fraudulently maximize their refunds. Shivers also directed clients to hand-write false information on tax forms and other documents used in the preparation of their returns. Shivers further admitted that she held training sessions for her employees, during which she would instruct them on how to manipulate the information on tax returns in order to obtain refunds to which the clients were not entitled. Between January 2014 and April 2017, Shivers and her co-conspirators prepared approximately 519 false tax returns, which claimed approximately $1.3 million in bogus refunds.
Shivers’ sentencing is scheduled for December 20, 2018. Shivers faces a statutory maximum sentence of five years in prison, as well as a period of supervised release, restitution and monetary penalties.
Shiver’s co-conspirators, Shannon DeWayne Patterson, Kristyn Dion Daney, and Rakeem Lenell Scales, have all pleaded guilty to charges of aiding and assisting in the preparation of false tax returns and are awaiting sentencing.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin commended special agents of IRS Criminal Investigation, who conducted the investigation, and Trial Attorneys Robert J. Boudreau and Lauren Castaldi of the Tax Division and Criminal Division Chief Clifton T. Barrett of the Middle District of North Carolina, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
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North Carolina Man Sentenced for Immigration Fraud and Tax ChargesRead the Press Release
Raleigh – Robert J. Higdon, Jr., United States Attorney for the Eastern District of North Carolina, announces that today, in federal court, HOUCINE GHOUL, was sentenced by Chief United States District Judge James C Dever III, to serve 24 months imprisonment, followed by deportation, for attempted unlawful procurement of naturalization and making a false statements on his tax return. GHOUL pleaded guilty to these charges on November 13, 2017.
GHOUL, a citizen of Tunisia, entered the U.S. in 2001 on a tourist visa. After overstaying his visa, GHOUL married a U.S. citizen, whom he later divorced, and obtained status as a legal permanent resident.
The investigation into GHOUL’s conduct began in April 2014 when GHOUL posted a photo online that explicitly displayed support for the Islamic State of Iraq and al-Sham (ISIS), a designated foreign terrorist organization. This photo displayed an individual holding a sign with the Arabic phrase, “The victory of the Islamic State in Iraq and Syria,” and then below this in English was written, “ISIS,” and “N. Carolina, USA.” The investigation later discovered that the individual holding the sign was merely an unwitting participant asked to hold the sign while GHOUL posed him in order to take the photo. The photo later appeared in an online propaganda video posted by others in an attempt to display the worldwide support for ISIS. Though he did not use his actual name or identity for the online accounts he used in regard to such conduct, GHOUL provided a self-description within the account: “Extremist, terrorist, tough, brain-washed, radical, I love explosions, booby trapping, beheading the enemy, and am among the supporters of establishing the religion with the sword.”
In December of 2014, GHOUL submitted an application for U.S. citizenship, and, in February 2017, GHOUL was interviewed in relation to his application. During this interview, GHOUL made a number of false statements. He falsely claimed that he had in no way associated with or been a member of any terrorist organization. He falsely claimed that he had never advocated for the overthrow of a government. He falsely claimed that he had never committed any offenses for which he had not been arrested. He falsely claimed that he had not married someone for the purpose of obtaining an immigration benefit. He falsely claimed that he had made other misrepresentations in order to obtain public benefits. All of these statements were false because GHOUL had sworn allegiance to ISIS and had been an active supporter of ISIS both online and in person, had explicitly advocated for the overthrow of the United States through violence, had unlawfully assisted in the sale of narcotics, had entered into a sham marriage for the sole purpose of obtaining U.S. citizenship, and had assisted in providing lies to the State of North Carolina in order to obtain childcare benefits.
Also, in 2015 and 2016, GHOUL filed tax returns in which he underreported his income by at least $90,000, thereby avoiding the payment of income tax.
Mr. Higdon complimented law enforcement’s tireless efforts: “Without the constant vigilance of our law enforcement partners, insidious threats such as this would never come to light until too late. Our country, our state, and every tax-paying citizen has been a victim of this defendant’s conduct. Thankfully, further victimization has come to an end and his violent rhetoric will no longer be a threat hiding within the Eastern District of North Carolina.”
The case was investigated by the Federal Bureau of Investigation, the Internal Revenue Service, and the Department of Homeland Security, Immigration and Customs Enforcement, Homeland Security Investigations. Assistant United States Attorney Jason Kellhofer represented the government in this case.
New Orleans Man Sentenced for Bank RobberyRead the Press Release
U.S. Attorney Duane A. Evans announced that EDDIE JAMES, age 40, of New Orleans, was sentenced today for a one-count Bill of Information charging bank robbery.
According to the Bill of Information, JAMES robbed the Fidelity Homestead Bank at 1201 S. Carrollton Avenue in New Orleans on November 2, 2017.
JAMES was sentenced to 39 months imprisonment, three years of supervised release and restitution in the amount of $1,114 to the Fidelity Homestead Bank at 1201 S. Carrollton Avenue, New Orleans, Louisiana.
U.S. Attorney Evans praised the work of the Federal Bureau of Investigation in investigating this matter. Assistant U.S. Attorney David Haller is in charge of the prosecution.
New Orleans Man Sentenced for Bank RobberyRead the Press Release
NEW ORLEANS – U.S. Attorney Duane A. Evans announced that EDDIE JAMES, age 40, of New Orleans, was sentenced today for a one-count Bill of Information charging bank robbery.
According to the Bill of Information, JAMES robbed the Fidelity Homestead Bank at 1201 S. Carrollton Avenue in New Orleans on November 2, 2017.
JAMES was sentenced to 39 months imprisonment, three years of supervised release and restitution in the amount of $1,114 to the Fidelity Homestead Bank at 1201 S. Carrollton Avenue, New Orleans, Louisiana.
U.S. Attorney Evans praised the work of the Federal Bureau of Investigation in investigating this matter. Assistant U.S. Attorney David Haller is in charge of the prosecution.
Navajo Woman Sentenced to Prison for Federal Involuntary Manslaughter ConvictionRead the Press Release
ALBUQUERQUE – Shannon Allen, 33, an enrolled member of the Navajo Nation who resides in Mariano Lake, N.M., was sentenced today in federal court in Albuquerque, N.M., to 34 months in prison for her conviction on an involuntary manslaughter charge. Allen will be on supervised release for three years after completing her prison sentence.
Allen was arrested in Oct. 2017, on a criminal complaint charging her with killing a man on Sept. 23, 2017, on the Navajo Indian Reservation in McKinley County, N.M. According to the complaint, Allen killed the victim when she lost controlled of her vehicle and caused her vehicle to rollover. At the time, Allen was driving under the influence of alcohol.
Allen subsequently was indicted on Oct. 24, 2017, and was charged with involuntary manslaughter. On May 10, 2018, Allen pled guilty to the indictment and admitted killing the victim while driving recklessly and under the influence of alcohol. Allen acknowledged that the alcohol rendered her incapable of exercising clear judgment and a steady hand in operating the vehicle.
This case was investigated by the Crownpoint office of the Navajo Nation Department of Public Safety and Assistant U.S. Attorney Raquel Ruiz-Velez prosecuted the case.
Myrtle Beach Man Goes to Trial on Federal Drug and Weapons Charges - Pleads Guilty at Close of Government's CaseRead the Press Release
Florence, South Carolina --- United States Attorney Sherri A. Lydon announced today that Frederick Julien Augustine, a/k/a “Cowboy,” age 42, of Mullins, South Carolina, entered a mid-trial guilty plea to possession with the intent to distribute more than 500 grams of cocaine, more than 28 grams of crack cocaine, and quantities of heroin, methamphetamine, and marijuana. In addition, he pled guilty to possessing a firearm in furtherance of a drug trafficking crime. Augustine had previously been convicted of Assault and Battery with Intent to Kill, Distribution of Crack Cocaine, Burglary (2nd Degree), and Possession of a Weapon during a Crime of Violence. Augustine’s plea subjects him to a statutory mandatory sentence of 180 months of incarceration.
The Government’s evidence showed that on October 26, 2017, officers of the Myrtle Beach Police Department Street Crimes Unit, assisted by a Task Force Officer of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), executed a search warrant on a Myrtle Beach apartment after observing Augustine leave alone. Inside the apartment, officers located approximately 641 grams of cocaine, 49 grams of crack cocaine, 59 grams of heroin, and 27 grams of methamphetamine, all hidden with arm’s reach of a loaded .357 Magnum revolver and additional ammunition. Officers additionally seized more than $11,000 in suspected drug proceeds hidden in a safe with more than ½ kilogram of cocaine, and downloaded several surveillance cameras that had been set up at the apartment. ATF’s analysis of the cameras confirmed that Augustine was at the apartment for weeks leading up to the execution of the warrant, and that he was the last person the leave before the search was conducted. Augustine was arrested on a traffic stop while the search warrant was being executed. He was in possession of $3,000 in additional suspected drug proceeds. Augustine pled guilty after the Government presented its evidence to the jury.
Assistant United States Attorney Everett McMillan of the Florence office handled the case, which was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) and the Myrtle Beach Police Department and prosecuted as part of the joint federal, state and local Operation “Real Time,” which seeks to fast track armed recidivists for federal prosecution. Operation “Real Time” is a part of the Project CeaseFire initiative, which aggressively prosecutes firearm cases. Project CeaseFire is South Carolina’s implementation of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions has made turning the tide of rising violent crime in America a top priority. In October 2017, as part of a series of actions to address this crime trend, Attorney General Sessions announced the reinvigoration of PSN and directed all U.S. Attorney’s Offices to develop a district crime reduction strategy that incorporates the lessons learned since PSN launched in 2001.
Augustine has been in continuous custody since his arrest on October 26, 2017, and he will remain in custody until he serves out his federal sentence.
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Mexican Citizen Admits Transportation of Illegal AlienRead the Press Release
ALBANY, NEW YORK – Feliciano Felipe Diaz-Estrada, also known as Feliciano Villas-Estrada, age 56, a Mexican citizen living in Long Island City, New York, pled guilty today to transporting an illegal alien within the United States.
The announcement was made by United States Attorney Grant C. Jaquith and Robert N. Garcia, Acting Chief Patrol Agent, United States Border Patrol, Swanton Sector.
As part of his plea, Diaz-Estrada admitted that on May 21, 2018, he drove to Montreal where he met with David Lopez-Garcia. Diaz-Estrada then drove to the Champlain Port of Entry and entered the United States alone. Simultaneously, Lopez-Garcia was walking across the border one-half mile east of the Champlain Port of Entry and avoided United States immigration inspection.
Lopez-Garcia walked to a spot south of the border where he waited for Diaz-Estrada. After entering the United States during the early morning of May 22, 2018, Diaz-Estrada drove to a cemetery in Champlain, New York, where he stopped and picked up the waiting Lopez-Garcia. Border Patrol Agents observed the pick-up and followed Diaz-Estrada as he entered I-87 southbound. Shortly after he entered I-87 southbound, Diaz-Estrada was stopped and arrested by Border Patrol Agents.
Lopez-Garcia, age 46, a citizen of Mexico residing in Charlotte, North Carolina, was convicted of the misdemeanor offense of entry without inspection on June 5, 2018 and sentenced to 15 days in jail.
As a result of his conviction, Diaz-Estrada faces up to 5 years in prison and a fine of up to $250,000 when he is sentenced by Senior United States District Judge Lawrence E. Kahn on December 6, 2018. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines, and other factors.
This case was investigated by Border Patrol and prosecuted by Assistant U.S. Attorney Edward P. Grogan.
Martin County Resident Sentenced to Thirty Years in Prison for Production and Distribution of Child PornographyRead the Press Release
Joshua Laine Rogers, 35, of Stuart, was sentenced yesterday by U.S. District Court Senior Judge Donald L. Graham to 30 years in prison, to be followed by a lifetime of supervised release, for producing and distributing pornography of a teenage victim. He was also ordered to register as a sex offender.
Benjamin G. Greenberg, U.S. Attorney for the Southern District of Florida, Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Ken Mascara, Sheriff, St. Lucie County Sheriff's Office (SLCSO), and William D. Snyder, Sheriff, Martin County Sheriff's Office (MCSO), made the announcement.
According to the court record, on September 3, 2017, SLCSO deputies responded to a “Missing Person Juvenile/ Runaway” call for a missing 16-year-old minor. On September 27, 2017, MCSO Detectives located Rogers with the minor victim. The investigation revealed that Rogers met the victim on-line and had the victim stay at his residence. A forensic analysis of Roger’s cellular smart phone revealed he had recorded sexually explicit activity with the minor victim on numerous occasions, using his cellular smartphone. Rogers distributed many of the captured images and videos to other individuals, via MMS text communications, on a social media networking program, and in the personal section of a Treasure Coast website.
Rogers and Lockley, together at Rogers’ residence, also produced videos depicting sexually explicit conduct and activity with the minor victim. A forensic analysis of Lockley’s cellular smart phone revealed he had used it to record sexually explicit activity with the minor victim.
On January 17, 2018, Co-Defendant Richard William Lockley, 34, of Stuart, pled guilty to one count of production of visual depictions of sexual exploitation of minors, in violation of Title 18, United States Code, Sections 2251(a) and (e). On April 20, 2018, Lockley was sentenced to 15 years in prison, to be followed by 10 years of supervised release, for producing pornography of that teenage victim.
On March 22, 2018, Rogers pled guilty to two counts of production of visual depictions of sexual exploitation of minors and one count of distribution production of visual depictions of sexual exploitation of minors, in violation of Title 18, United States Code, 2252(a)(2) and (b)(1).
Mr. Greenberg commended the investigative efforts of the FBI, SLCSO and the MCSO for their work on this case. This case was prosecuted by Assistant U.S. Attorney Carmen Lineberger.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Man Sentenced to 8 Years in Prison for Child PornographyRead the Press Release
NORFOLK, Va. – A Virginia Beach man was sentenced today to 8 years in prison and 20 years of supervised release for receipt, transportation, and possession of images of child sexual abuse.
According to court documents, Robert Michael Fall, 42, possessed thousands of images and videos of child sexual abuse at the time of his arrest, and had been collecting the images for at least a decade. A search warrant and forensic investigation revealed that Fall possessed at least two laptops, numerous DVDs, and a Dropbox account containing illicit images and videos. Despite the fact that Fall used fake email accounts to try to hide his digital tracks, the evidence at trial indicated that his Dropbox account alone contained over 320 images and over 2,900 videos of child sexual abuse. Virginia Beach police first became aware of Fall’s illegal conduct when a relative reported finding a laptop with images of apparent child sexual abuse in Fall’s bedroom.
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, Michael K. Lamonea, Assistant Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Norfolk, and James A. Cervera, Chief of Virginia Beach Police, made the announcement after sentencing by Senior U.S. District Judge Henry Coke Morgan, Jr. Assistant U.S. Attorneys Elizabeth M. Yusi and Daniel T. Young 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. 2:17-cr-12.
Lowell Physicians Settle Drug Diversion AllegationsRead the Press Release
BOSTON – Two Lowell-based physicians have agreed to settle with the U.S. Attorney’s Office to resolve allegations of improper dispensing of controlled substances and improper billing.
Dr. Hung K. Do and his addiction treatment clinic, H.K.D. Treatment Options, have agreed to pay $23,000 to settle claims of improper billing of medical services under the Controlled Substances Act and the False Claims Act. Dr. Vasumathi Brown, a physician employed by H.K.D., has agreed to pay a $12,500 civil penalty for issuing invalid prescriptions for controlled substances under the Controlled Substances Act.
It is alleged that, at Dr. Do’s direction, Dr. Brown signed hundreds of blank prescriptions for use by unsupervised non-physician staff while Dr. Brown was on vacation abroad in December 2016. Ultimately, unsupervised non-physician staff issued over 600 prescriptions for controlled substances using the pre-signed blank prescriptions. It is further alleged that Dr. Do subsequently billed Medicare improperly for services related to the prescriptions that non-physician staff provided in Dr. Brown’s absence, and that Dr. Do falsely reported to Medicare that Dr. Brown supervised those services.
“Ensuring the proper handling of prescriptions is a critical part of our ongoing efforts to maintain patient safety and prevent drug diversion,” said United States Attorney Andrew E. Lelling. “Our success in fighting the opioid crisis depends on the diligence of prescribers in ensuring that those seeking addiction treatment receive proper medical supervision.”
“In response to the ongoing opioid epidemic DEA’s obligation is to improve public safety and public health,” said DEA Special Agent in Charge Brian D. Boyle. “We are committed to working with our law enforcement and regulatory partners to ensure that rules and regulations that protect against drug diversion and promote responsible dispensing of controlled substances are followed.”
“We entrust physicians and their medical practices to medically care for their patients, honestly bill for services, and ensure that taxpayers’ healthcare dollars are properly spent, ” said Phillip Coyne Special Agent in Charge of the U.S. Department of Health and Human Services Office of Inspector General. “HHS-OIG will continue to pursue penalties against medical providers who inappropriately bill Medicare and potentially jeopardize patient safety by failing to properly manage their prescribing of controlled substances.”
“This settlement highlights the FBI’s commitment to combating the illegal distribution of opioids by medical professionals,” said Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division. “We’re committed to working with our law enforcement partners to make sure dishonest health care professionals who exploit Medicare through fraudulent billing and other schemes will be held accountable.”
U.S. Attorney Lelling, DEA SAC Boyle, HHS-OIG SAC Coyne, and FBI SAC Shaw, made the announcement today. Assistant U.S. Attorneys Kriss Basil and Doreen Rachal of Lelling’s Office handled the matter.
Los Angeles Strike Force Targets Drug Trafficking Organizations that Allegedly Smuggled Sinaloa Cartel Narcotics into U.S.Read the Press Release
LOS ANGELES – Capping a three-year investigation by the Los Angeles Strike Force, authorities this morning arrested 20 defendants named in a series of indictments that allege the smuggling of large quantities of narcotics from Mexico on behalf of the Sinaloa Cartel.
Those arrested this morning are among 57 defendants named in three indictments that were unsealed this morning. Two of the defendants were already in state custody and are being turned over today to federal authorities. The remaining 35 defendants are currently fugitives, with most of those believed to be in Mexico at this time.
The investigation – dubbed Operation Narconetas – targeted three drug trafficking organizations that allegedly transported bulk quantities of cocaine, methamphetamine and heroin from Mexico to the Los Angeles metropolitan area and other locations across the United States. The investigation revealed that Sinaloa Cartel operatives moved narcotics to the northern reaches of Mexico, and the defendants charged in the indictments transported the drugs into the United States, often using vehicles with hidden compartments. One of the indictments alleges that money generated from illegal drug sales in the United States transported in bulk quantities from the United States into Mexico.
As a result of Operation Narconetas, authorities seized approximately 850 pounds of methamphetamine, nearly one ton of cocaine, 93 pounds of heroin, almost 50 pounds of marijuana, and $1.42 million in United States currency.
The Los Angeles Strike Force investigation was led by the Federal Bureau of Investigation, in partnership with the Drug Enforcement Administration. Agencies participating in Operation Narconetas include the Los Angeles Police Department; IRS Criminal Investigation; U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; the United States Marshals Service; the Bureau of Alcohol, Tobacco, Firearms and Explosives; the California Highway Patrol; the Torrance Police Department; the Glendale Police Department; the Pomona Police Department; the Fullerton Police Department; and the Azusa Police Department.
These Strike Force members uncovered several sophisticated international drug trafficking organizations that regularly transported narcotics across the U.S.-Mexico border and at times stored drugs in “stash houses” in cities across the Southland. The narcotics then were distributed throughout the United States.
The Los Angeles Strike Force was formed in 2014 to target Mexican drug cartels that utilize the Los Angeles metropolitan region as a primary hub for the distribution of narcotics across the United States. The goals of the Strike Force are to target high-level narcotics traffickers, disrupt and dismantle the cartels’ narcotics trafficking and related money laundering activities, and arrest and prosecute the cartels’ leaders and operatives.
“More than simply seizing large quantities of drugs and money, this investigation was able to identify the top-level, Mexican-based traffickers who directed the transactions, and who thought they were using secure communication devices to commit their crimes,” said First Assistant United States Attorney Tracy L. Wilkison. “Our ability to obtain those communications continues to be an important part of our ability to solve these crimes. The Los Angeles Strike Force has become a leader in using innovative investigative techniques to target Mexico-based drug trafficking organizations.”
“This investigation was responsible for removing over 1,300 kilograms of narcotics from the streets of Los Angeles and other cities, and no doubt prevented violence in our communities, said Paul Delacourt, the Assistant Director in Charge of the FBI in Los Angeles. “We expect this case will have a significant impact on the transportation abilities of these organizations.”
“The Greater Los Angeles Area is utilized by criminal organizations as a hub for the transportation and distribution of illicit drugs throughout the United States,” said DEA Associate Special Agent in Charge Bill Bodner. “Today’s joint operation sends a clear message that law enforcement is committed to stemming the flow of narcotics into our country and protecting Americans from the violence that accompanies drug trafficking.”
The three drug trafficking indictments each allege conspiracies to distribute controlled substances. The indictments also contain asset forfeiture allegations in which the government is seeking to forfeit any property used to commit or facilitate the drug trafficking offenses. One of the indictments alleges a conspiracy to launder money and bulk cash smuggling.
“Today’s arrest of multiple defendants for their alleged role in smuggling funds from illegal drug transactions in and out of the United States is a victory for the American public and a defeat to drug traffickers everywhere. The special agents of IRS Criminal Investigation continue in their mission to disrupt the flow of ill-gotten gains that is the life-blood for these criminals,” said Special Agent in Charge R. Damon Rowe, Los Angeles Field Office, IRS Criminal Investigation. “We will continue to be relentless in our mission to dismantle these drug trafficking organizations and bring the criminals who run them to justice.”
The defendants arrested today in the Central District of California are being arraigned, starting this morning, in United States District Court in Los Angeles.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until and unless proven guilty in court.
If they are convicted in this case, most of the defendants would be subject to mandatory minimum sentences of 10 years in federal prison and potential sentences of life without parole.
Leawood Attorney Pleads Guilty to Federal Tax EvasionRead the Press Release
KANSAS CITY, KAN. – A Leawood attorney admitted today that he concealed his assets and income in an effort to keep the Internal Revenue Service from collecting more than $132,000 in taxes he owed, U.S. Attorney Stephen McAllister said.
David B. Mandelbaum, Leawood, Kan., pleaded guilty to one count of tax evasion. In his plea, he admitted he owed more than $132,000 from the 2005, 2006, 2007, 2009 and 2010 tax years. He concealed his assets and income from the IRS by setting up bank accounts under other identities and making false statements. He also kept personal money in a trust account that was supposed to include only funds belonging to clients, in order to hide that money from the IRS.
Sentencing is set for October 29. He faces a penalty of up to three years in federal prison and a fine up to $250,000. He agreed to pay restitution of slightly more than $202,000, which includes penalties and interest. The Internal Revenue Service investigated. Assistant U.S. Attorney Leon Patton is prosecuting.
Leader and Other Members of Multi-State Drug Trafficking Organization Sentenced in Federal CourtRead the Press Release
Columbia, South Carolina --- United States Attorney Sherri A. Lydon announced today that Joshua Peace, age 30, mother of Joshua Peace, Susan Peace, age 63, Brian Harper, age 34, and Regina Kinard, age 42, were sentenced in federal court. Joshua Peace, Kinard, and Harper pled guilty to participating in a drug conspiracy involving more than 500 grams of methamphetamine, and received sentences of 15 years imprisonment, 12 years imprisonment, and 11 years imprisonment respectively. Susan Peace pled guilty to using a telephone to facilitate a drug trafficking crime, and she received a sentence of 5 years’ probation with electronic monitoring and a curfew.
Assistant United States Attorney Andy Moorman told the Court during the sentencing hearings that Joshua Peace, with the help of his mother, Susan Peace, Kinard, Harper, and others facilitated the distribution of approximately $1.2 million in methamphetamine in the Upstate of South Carolina and elsewhere. Peace would send couriers to meet with sources of supply for methamphetamine in Northern Georgia. These couriers would purchase kilogram quantities of methamphetamine and return to the Upstate of South Carolina, typically Anderson, South Carolina. Once there, the methamphetamine would be dispersed among local distributors, who would sell the methamphetamine and return the proceeds to Josh Peace. During the course of the investigation and prosecution, federal agents and local law enforcement seized in excess of $600,000 in U.S. Currency, seven automobiles, and other property that conspirators bought with drug proceeds.
The Drug Enforcement Administration, the Internal Revenue Service Criminal Investigation Division, the Anderson County Sheriff’s Office, the Anderson Police Department, and the Franklin County (GA) Sheriff’s Office investigated the case.
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Las Vegas Woman Sentenced to Jail for Wire Fraud and Money Laundering OffensesRead the Press Release
HONOLULU – Donna Alms, 55, a resident of Las Vegas, Nevada, and formerly of the Big Island of Hawaii, was sentenced today to 33 months in federal prison for defrauding Waste Management of Hawaii, Inc. of $862,722 over the course of 4 years.
According to information presented in court, Alms pled guilty in January 2018 to wire fraud and money laundering offenses that occurred while she was an operations specialist for Waste Management on the Island of Hawaii. Alms’s duties included obtaining temporary laborers to pick litter from Waste Management’s landfill site, and to arrange for their payment through an outside vendor. The vendor would then submit invoices to Alms for payment by Waste Management. During court proceedings, Alms admitted that she inflated approximately 247 invoices submitted to Waste Management by the vendor by cutting and pasting numbers onto a template that she maintained. Alms’s activities caused Waste Management to pay the vendor $862,722 in costs above what was actually billed. Alms then directed the vendor to return $692,549 of the excess payments to her, calling them “wages” to disguise the nature, source, and ownership of the funds.
U.S. District Judge Derrick K. Watson imposed a 33 month sentence, noting that Alms’s conduct was elaborate and repetitive. Alms was also ordered to pay restitution of $862,722, and to serve a 3 year term of supervision following her release.
The case was investigated by the Federal Bureau of Investigation and the Internal Revenue Service, Criminal Investigations, and was prosecuted by Assistant U.S. Attorney Larry Tong.
Kayenta Man Sentenced to 46 Months in Federal Prison for Involuntary Manslaughter Related to Drunk DrivingRead the Press Release
PHOENIX – On Aug. 8, 2018, Ethan Barlow, 27, of Kayenta, Ariz., and a member of the Navajo Nation, was sentenced by U.S. District Judge David G. Campbell to 46 months in prison, followed by 3 years of supervised release. Barlow had previously pleaded guilty to one count of involuntary manslaughter.
The case involved Barlow driving his vehicle with a BAC level of over .134 (three hours post-crash). Barlow admitted that he had been drinking rum and smoking marijuana. As a result, Barlow caused his vehicle to roll over and crash, killing his sole passenger. The crash occurred within the Navajo Reservation.
The investigation in this case was conducted by the Federal Bureau of Investigation, Navajo Nation Department of Law Enforcement, and the Arizona Department of Public Safety. The prosecution was handled by Sharon K. Sexton, Assistant U.S. Attorney, District of Arizona.
CASE NUMBER: CR-17-8318-PCT-DGC
RELEASE NUMBER: 2018-103_ Barlow
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For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
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Jefferson County, Ohio man sentenced to 30 years for drug distribution and firearms chargesRead the Press Release
CLARKSBURG, WEST VIRGINIA – Emory Chiles, of Steubenville, Ohio, was sentenced this week to 360 months incarceration for drug and firearms charges, United States Attorney Bill Powell announced.
“When illegal drug distribution is combined with firearms it represents a clear and present danger to the citizens of this district and won’t be tolerated. This sentence sends a strong message to those engaging in this type of conduct that they will be prosecuted to the fullest extent of the law, “ said Powell.
A jury found Chiles, age 43, guilty of one count of “Possession with Intent to Distribute Heroin,” one count of “Use of a Firearm During and in Relation to a Drug Offense,” and one count of “Unlawful Possession of a Firearm” in April 2018. Chiles distributed heroin and possessed a 9mm pistol in Monongalia County in November 2017. Chiles was previously convicted of a felony in the Northern District of West Virginia.
“Drug dealers with guns are violent criminals who pose an increased threat to the safety of our communities,” stated ATF Special Agent in Charge Stuart Lowrey of the Louisville Field Division. “ATF and our local partners will aggressively investigate, arrest and pursue prosecution of these offenders.”
This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions has made turning the tide of rising violent crime in America a top priority. In October 2017, as part of a series of actions to address this crime trend, Attorney General Sessions announced the reinvigoration of PSN and directed all U.S. Attorney’s Offices to develop a district crime reduction strategy that incorporates the lessons learned since PSN launched in 2001.Assistant U.S. Attorney Zelda E. Wesley prosecuted the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Monongalia County Sheriff’s Office investigated.
Senior U.S. District Judge Irene M. Keeley presided.Jamaican National Sentenced for Aggravated Identify TheftRead the Press Release
BOSTON – A Jamaican national was sentenced today in federal court in Boston for misuse of a Social Security number and aggravated identity theft.
Basil Ledgister, 41, was sentenced by U.S. Senior District Court Judge Rya W. Zobel to 26 months in prison. In May 2018, Ledgister pleaded guilty to one count of misuse of a Social Security number and one count of aggravated identity theft.
In January 2015, Ledgister falsely represented that a Social Security number belonging to another person was his in an application for a license at the Registry of Motor Vehicles. Ledgister committed aggravated identity theft by using the Social Security number of another person in committing the crime of false representation of a Social Security number.
United States Attorney Andrew E. Lelling; Peter C. Fitzhugh, Special Agent in Charge of Homeland Security Investigations in Boston; William B. Gannon, Special Agent in Charge of the U.S. Department of State, Bureau of Diplomatic Security, Boston Field Office; Scott Antolik, Special Agent in Charge of the Social Security Administration Office of Inspector General; and Colonel Kerry A. Gilpin, Superintendent of the Massachusetts State Police, made the announcement today. Assistant U.S. Attorney Robert Richardson of Lelling’s Major Crimes Unit prosecuted the case.
Inmate Sentenced for Contraband Smuggling at Jackson County Detention CenterRead the Press Release
KANSAS CITY, Mo. – An inmate at the Jackson County Detention Center was sentenced in federal court today for leading a conspiracy to smuggle contraband cell phones and other items into the jail.
Carlos Laron Hughley, 33, of Kansas City, Mo., was sentenced by U.S. District Judge Gary A. Fenner to six years and six months in federal prison without parole.
The court ordered today’s federal sentence be served consecutively to any sentence that may be imposed in an unrelated state case in which Hughley is charged with domestic assault, armed criminal action, careless and imprudent driving, possession of a controlled substance and resisting arrest.
On Feb. 14, 2018, Hughley pleaded guilty to one count of conspiracy and one count of using a telephone in furtherance of unlawful activity. While he was an inmate in the Jackson County Detention Center, Hughley was the ringleader of a scheme to smuggle contraband (including a cell phone and charging cable) into the jail. Aided and abetted by minions outside the jail acting at his direction, Hughley bribed a former corrections officer, Jalee Caprice Fuller, 30, of Independence, Mo., to smuggle contraband to inmates at the detention center between May 2 and June 26, 2017.
Hughley is the father of an infant child he conceived with Fuller. According to court documents, Hughley used the affections Fuller had for him to convince her to violate the trust placed in her as a corrections officer and participate in the contraband smuggling scheme.
Fuller, as well as co-defendant Marion Lorenzo Byers, also known as “Cuddy,” 36, of Kansas City, Mo., also have pleaded guilty and been sentenced. Co-defendant Janikkia Lashay Carter, 36, of Kansas City, Mo., also has pleaded guilty and awaits sentencing.
Each defendant participated in multiple recorded telephone calls where various aspects of the contraband smuggling scheme were discussed. Byers, an associate of Hughley’s, delivered the contraband to Carter, one of Hughley’s former love interests. Knowing that Carter still had feelings for him, and despite the fact that Hughley was professing to Fuller that he only wanted to be with her, Hughley used the affections Carter had for him to convince her to commit the crime of smuggling contraband into the jail. Carter in turn delivered contraband to Fuller. Fuller used her position as a corrections officer to smuggle the contraband to Hughley inside the detention center.
In a separate case arising from the federal investigation, another former corrections officer, Andre Lamonte Dickerson, 26, of Kansas City, Mo., pleaded guilty to two counts of using a telephone in furtherance of the unlawful activity of acceding to corruption, related to a public servant taking a bribe in return for violating his legal duty. Dickerson admitted that he told a confidential informant that he would smuggle two packs of cigarettes, a cell phone and a cell phone charger to an inmate in the detention center for $500. Dickerson is scheduled to be sentenced on Aug. 31, 2018.
These cases are being prosecuted by Deputy U.S. Attorney Gene Porter and Assistant U.S. Attorney Brent Venneman. They were investigated by the FBI and the Jackson County, Mo., Sheriff’s Department with assistance from the Missouri Department of Corrections, the Kansas City, Mo., Police Department and the Jackson County Detention Center.
Indictment: Woman Serving Fraud Sentence Walked Away from Halfway HouseRead the Press Release
KANSAS CITY, KAN. – A Texas woman was charged today with escaping from custody at a halfway house where she was serving a sentence for fraud, U.S. Attorney Stephen McAllister said.
Chrystal Rippey, 38, formerly of Marshall, Texas, is charged with one count of escaping federal custody. In May 2015, she was sentenced to five years in federal prison for wire fraud. She pleaded guilty to defrauding a Texas couple who gave her more than $22,000 as part of a plan to adopt her unborn twins. In fact, Rippey lied to the couple and she was not pregnant.
On July 17, 2018, Rippey turned up missing from the Grossman Residential Reentry Center in Leavenworth, Kan. She was arrested later in Monroe, La.
If convicted, she faces up to five years in federal prison and a fine up to $250,000. The U.S. Marshals Service investigated. Assistant U.S. Attorney Chris Oakley is prosecuting.
OTHER INDICTMENTS
Scott Joseph Skibo, 54, Chetopa, Kan., is charged in a superseding indictment with two new counts, including one count of growing marijuana and one count of unlawful possession of a firearm following a felony conviction. Charges remaining from an earlier indictment include one count of possession with intent to distribute marijuana and one count of possession of a firearm in furtherance of drug trafficking. The crimes are alleged to have occurred Sept. 18, 2017, in Labette County, Kan.
Upon conviction, the crimes carry the following penalties:
Manufacturing marijuana: Up to five years in federal prison and a fine up to $250,000.
Possession with intent to distribute marijuana: Up to 20 years and a fine up to $250,000.
Possession of a firearm in furtherance of drug trafficking: Not less than five years and a fine up to $250,000.
Unlawful possession of a firearm following a felony conviction: Up to 10 years and a fine up to $250,000.
The Kansas Bureau of Investigation, the Labette County Sheriff’s Department and the Chetopa Police Department investigated. Special Assistant U.S. Attorney Kimberly Rodebaugh is prosecuting
Carlos Jaquez-Terrazas, 33, who is not a citizen of the United States, is charged with one count of possessing a firearm while in the United States unlawfully. The crime is alleged to have occurred July 18, 2018, in Sedgwick County, Kan.
If convicted, he faces a penalty up to 10 years in federal prison and a fine up to $250,000. A deportation officer with Immigration and Customs Enforcement investigated. Assistant U.S. Attorney Debra Barnett is prosecuting.
Jose Vincente Lira-Ramirez, 44, a citizen of Mexico, is charged with unlawfully re-entering the United States after being deported. He was found July 1, 2018, in Sedgwick County, Kan.
If convicted, he faces up to 10 years in federal prison and a fine up to $250,000. A deportation officer with Immigration and Customs Enforcement investigated. Assistant U.S. Attorney Debra Barnett is prosecuting.
Ignacio Hernandez-Mendez, 48, who is not a citizen of the United States, is charged with unlawfully re-entering the United States after being deported. He was found June 27, 2018, in Wyandotte County, Kan.
If convicted, he faces up to two years in federal prison and a fine up to $250,000. Immigration and Customs Enforcement investigated. Assistant U.S. Attorney Scott Rask is prosecuting.Pedro Carrera-Ramos, 27, who is not a citizen of the United States, is charged with unlawfully re-entering the United States after being deported. He was found July 12, 2018, in Johnson County, Kan.
If convicted, he faces up to two years in federal prison and a fine up to $250,000. Immigration and Customs Enforcement investigated. Assistant U.S. Attorney Scott Rask is prosecuting.
Carlos Ramirez-Reyes, 41, a citizen of Mexico, is charged with unlawfully re-entering the United States after being deported. He was found May 7, 2018, in Sedgwick County, Kan.
If convicted, he faces up to 10 years in federal prison and a fine up to $250,000. A deportation officer with Immigration and Customs Enforcement investigated. Assistant U.S. Attorney Debra Barnett is prosecuting.
Marco Antonio Cardenas-Rodriguez, 40, a citizen of Mexico, is charged with unlawfully re-entering the United States after being deported. He was found July 27, 2018, in Sedgwick County, Kan.
If convicted, he faces up to 10 years in federal prison and a fine up to $250,000. A deportation officer with Immigration and Customs Enforcement investigated. Assistant U.S. Attorney Debra Barnett is prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
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Heroin Dealer Sentenced to 22 Years for Drug and Gun CrimesRead the Press Release
RICHMOND, Va. – A Fredericksburg man was sentenced today to 22 years in prison for his role in a heroin distribution conspiracy and for being a felon in possession of a firearm.
According to court records and evidence presented at trial, Dustin Washington, 35, joined a conspiracy in late 2014 with several other individuals to sell heroin in the Fredericksburg and Spotsylvania County areas. Over the course of the conspiracy Washington sold fentanyl, a more potent, synthetic form of heroin, at least three times, including twice to an undercover officer. Subsequently, law enforcement used a confidential source to make controlled purchases of heroin from Washington in 2016. Audio recordings made during the controlled purchases revealed that Washington used other members of the conspiracy to provide him heroin to sell. On April 17, 2017, law enforcement executed search warrants on the homes of two other co-conspirators, finding more than 75 grams of heroin, and large quantities of cocaine and Molly. While executing a search warrant on Washington’s vehicle, law enforcement found an AR-15 rifle in the trunk. From 2014 through 2017, Washington and his co-conspirators distributed and possessed with the intent to distribute more than 1 kilogram of heroin.
On January 25, 2018, a federal jury convicted Washington of conspiracy to distribute and possess with intent to distribute 1 kilogram or more of heroin, and of possession of a firearm by a convicted felon. At trial Washington testified that he was not a part of the conspiracy and had never seen the AR-15 found in his vehicle. At the sentencing hearing, the court found that Washington had committed perjury during his trial testimony, resulting in a sentencing guidelines range of 235-292 months.
Co-defendants Earnest Wright, Tyrell Brown, Michael Fox, and Sheronda Fox, all pleaded guilty and received sentences of 20, 18, 17, and 9 years, respectively.
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. Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Scott W. Hoernke, Acting Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division, and Adam S. Lee, Special Agent in Charge of the FBI’s Richmond Field Office, made the announcement after sentencing by U.S. District Judge Henry E. Hudson. Assistant U.S. Attorney Stephen E. Anthony prosecuted the case.
The case was investigated by the Fredericksburg FBI Narcotics Task Force, which includes the DEA, FBI, Virginia State Police, Orange County Sheriff’s Office, Stafford County Sheriff’s Office, Spotsylvania County Sheriff’s Office, and Fredericksburg Police Department.
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. 3:17-cr-104.
Henderson Man Sentenced to 10 Years for Felon in Possession ChargeRead the Press Release
NEW BERN – The United States Attorney for the Eastern District of North Carolina, Robert J. Higdon, Jr., announced that today, ODELL LAMECHE OVERBY, 46, of Henderson, North Carolina, was sentenced by United States District Judge Louise W. Flanagan to 120 months imprisonment followed by 3 years of supervised release.
OVERBY was named in an Indictment on March 15, 2018 charging him with Possession of a Firearm by a Felon. On May 16, 2018, OVERBY pled guilty to the charge.
On December 18, 2017, members of the Granville County Sheriff’s Office responded to a home invasion in Oxford. Upon arriving at the residence, deputies observed a vehicle backed up to the residence with the engine running, the trunk open, and several items in the trunk of the vehicle. Deputies saw and secured OVERBY inside the house. Deputies observed an AR-15 assault rifle on the floor a short distance away from OVERBY. OVERBY was placed under arrest. Deputies determined that the firearm was loaded and that OVERBY had been taking items out of the home after breaking into it.
There was one person in the home that was able to call for help from a bedroom when OVERBY made entry into the house. OVERBY pointed the rifle at the person and tied them up.
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. Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
In support of PSN, the United States Attorney’s Office for the Eastern District of North Carolina has implemented the Take Back North Carolina Initiative. This initiative emphasizes the regional assignment of federal prosecutors to work with law enforcement and District Attorney’s Offices on a sustained basis in those communities to reduce the violent crime rate, drug trafficking, and crimes against law enforcement.
The investigation of this case was conducted by the Granville County Sheriff’s Office and the Bureau of Alcohol, Tobacco, Firearms & Explosives (ATF). Assistant United States Attorney S. Katherine Burnette handled the prosecution of this case for the government.
Hartford Man Pleads Guilty to Federal Gun ChargeRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that CHRISTON MITCHELL, also known as “Blaze,” 29, of Hartford, waived his right to be indicted and pleaded guilty today in New Haven federal court to one count of possession of a firearm and ammunition by a convicted felon.
According to court documents and statements made in court, in May 2018, law enforcement received information that MITCHELL was attempting to sell a firearm. On May 9, 2018, investigators attempted a controlled purchase of a firearm from MITCHELL in exchange for $450. During the transaction on Farmington Avenue in Hartford, MITCHELL fled from law enforcement in a car at a high rate of speed. The pursuit ended in Wethersfield where MITCHELL was apprehended. At the time of his arrest, MITCHELL possessed a loaded .40 caliber Hi-Point, Smith and Wesson handgun.
MITCHELL was convicted in state court in 2014 for criminal possession of a weapon, in 2011 for conspiracy to commit first-degree robbery, in 2009 for second-degree burglary and second-degree sexual assault, in 2008 for third-degree larceny, and in 2007 for third-degree robbery and carrying a dangerous weapon.
It is a violation of federal law for a person previously convicted of a felony offense to possess a firearm or ammunition that has moved in interstate or foreign commerce.
MITCHELL is scheduled to be sentenced by U.S. District Judge Alvin W. Thompson on October 31, 2018, at which time MITCHELL faces a maximum term of imprisonment of 10 years. MITCHELL has been detained since his arrest.
This matter is being investigated by the FBI’s Northern Connecticut Violent Crimes Gang Task Force and the Hartford Police Department. The case is being prosecuted by Assistant U.S. Attorney Michael J. Gustafson.
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 neighborhoods safer for everyone.
Green Bay Man Sentenced to Prison for Drug Dealing and Sex TraffickingRead the Press Release
United States Attorney Matthew D. Krueger announced that Damien D. Gambrell (age: 37) of Green Bay, Wisconsin, was sentenced on August 3, 2018 in federal court in Green Bay for conspiracy to distribute heroin and enticement of another to travel in interstate commerce to engage in a prostitution act. Chief United States District Judge William C. Griesbach sentenced Gambrell to a ten year term of imprisonment on the drug conspiracy charge and a ten year term of imprisonment to run concurrently on the enticement charge. Judge Griesbach also gave Gambrell credit on the ten year prison term for time Gambrell spent in state and federal custody leading up to the sentencing. Judge Griesbach placed Gambrell on supervised release for ten years following his term of imprisonment. Because of the enticement conviction, Gambrell is also required to register as a sex offender.
Gambrell was sentenced following his earlier guilty plea to the drug conspiracy charge that included distribution of over 100 grams of heroin and also involved the distribution of heroin leading to an overdose death. While investigating the heroin overdose case, Green Bay Police recovered text messages and telephone calls consistent with Gambrell enticing and soliciting adult women to engage in prostitution acts in the greater Green Bay area as well as Chicago, Illinois. Police also found several adult women who confirmed that Gambrell enticed and persuaded them to engage in sexual acts for money. Gambrell supplied some of these women with heroin and had them assist with heroin sales.
In imposing sentence, Chief Judge Griesbach stressed the tragic nature of the case including the accidental overdose deatjh, and the impact it had on his family and community in general. Further, Chief Judge Griesbach stated Gambrell’s exploitation of drug addicts and adult women for his financial gain warranted a lengthy sentence and should deter others from committing a similar offense.
This case was investigated by the Green Bay Police Department, Brown County District Attorney’s Office, and Brown County Drug Task Force. The case was prosecuted by Assistant United States Attorney William Roach.
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For additional information contact:
Public Information Officer Dean Puschnig, 414-297-1700
Gainesville brothers sentenced for distributing crack cocaineRead the Press Release
GAINESVILLE, Ga. – Twin brothers, Kecole Dukes and Kemeca Dukes, have been sentenced for conspiracy to distribute and distribution of crack cocaine.
“Crack cocaine continues to be a scourge in our communities – particularly in North Georgia,” said U.S. Attorney Byung J. “BJay” Pak. “These defendants have multiple state convictions for distributing crack cocaine in the past. Their sentences today demonstrate the serious consequences that career drug dealers face when they are convicted in federal court.”
“The distribution of narcotics, like crack cocaine, fuels violent crime in our community,” said ATF Special Agent in Charge Arthur Peralta. “The Dukes brothers could have chosen a different life path, but unfortunately they did not. ATF will continue to focus on the reduction of violent crime in our communities and this sentence should serve as a warning to anyone who chooses to support or engage in violent crime. ATF, along with our federal and state partners, will find you and we will arrest you.”
According to U.S. Attorney Pak, the charges and other information presented in court: From August 2015 to October 2016, Kemeca Dukes and Kecole Dukes, who are twin brothers, conspired to sell crack cocaine on multiple occasions to informants working for ATF and the Hall County Multi-Agency Narcotics Squad (MANS) Unit. Kemeca Dukes was the primary contact for the informants and sold varying quantities of crack cocaine to them on 10 occasions. Kecole Dukes sold or provided crack cocaine to the informants on three occasions and acted as a lookout for his brother on other occasions when Kemeca Dukes met with the informants to sell them crack cocaine.
At the time, both Kemeca Dukes and Kecole Dukes were on parole with the State of Georgia. Both were convicted in Hall County Superior Court in 2011, for selling crack cocaine and both were released in 2014. Both brothers were back selling crack cocaine less than a year later.
Kecole Dukes, 41, of Gainesville, Georgia was sentenced to eight years in prison to be followed by four years of supervised release on August 7, 2018. He was found guilty on March 29, 2018, by a federal court jury of conspiring to possess with intent to distribute at least 28 grams of crack cocaine and three counts of distributing crack cocaine.
Kemeca Dukes, 41, of Gainesville, Georgia was sentenced to seven years, six months in prison to be followed by four years of supervised release on August 7, 2018. He pleaded guilty to one count of distributing crack cocaine on March 23, 2018.
This case was investigated jointly by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Hall County Multi-Agency Narcotics Squad Unit.
Assistant U.S. Attorney William L. McKinnon, Jr., Senior Litigation Counsel for the Gainesville, Georgia Division; Assistant U.S. Attorney Erin E. Sanders; and former Special Assistant U.S. Attorney and Hall County Assistant District Attorney Juliet Aldridge, prosecuted the case.
The U.S. Attorney’s Office in Atlanta recommends parents and children learn about the dangers of drugs at the following web site: www.justthinktwice.gov.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Former cardiology practice office manager sentenced for embezzling over $1.1 millionRead the Press Release
ATLANTA - Monica Rigsby, a former office manager for a cardiology practice, has been sentenced to federal prison for embezzling over $1.1 million from her employer.
“This defendant’s greed drove her to steal over one million dollars from her employer,” said U.S. Attorney Byung J. “BJay” Pak. “Criminals who embezzle money from businesses will face prosecution, but employers should also take steps to safeguard against fraud committed by their employees.”
“Rigsby took advantage of her position to profit illegally, violating the trust that Georgia Pediatric Cardiology put in her,” said J.C. “Chris” Hacker, Special Agent in Charge of FBI Atlanta. “Her conviction should serve as a reminder that the FBI is committed to making cases like this a strong deterrent to those tempted by greed.”
According to U.S. Attorney Pak, the charges and other information presented in court: Rigsby was the office manager at the Georgia Pediatric Cardiology practice located in Stockbridge, Georgia. While working as the office manager, the defendant altered the accounting system to make it appear that she was being reimbursed for legitimate expenses when, in fact, she was stealing a portion of the funds and diverting the money for her own personal use. Rigsby’s fraud scheme cost the medical practice over $1.1 million. The defendant used the embezzled funds to purchase clothing, jewelry, an automobile, and to pay for her daughter’s college tuition.
Monica Rigsby, 55, of Saint Petersburg, Florida, was sentenced to two years, six months in prison to be followed by three years of supervised release on August 7, 2018. Rigsby was also ordered to pay restitution in the amount of $1,178,314.
This case was investigated by the Federal Bureau of Investigation.
Assistant U.S. Attorney Thomas J. Krepp and Assistant U.S. Attorney Nathan P. Kitchens, Deputy Chief of the Cyber & Intellectual Property Crime Section prosecuted the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Former Wichita Police Officer Pleads Guilty, Admits He Knew About Illegal GamblingRead the Press Release
WICHITA, KAN. – A former Wichita police officer pleaded guilty today and admitted he knew about illegal poker games, U.S. Attorney Stephen McAllister said.
Bruce Mackey, 46, Goddard, Kan., pleaded guilty to one count of misprision of a felony. Mackey admitted that while he was a police officer he knew and did not report individuals who were conducting a gambling business. During an illegal poker game in February 2014, Mackey told the organizers of the game that one of the gamblers was a Wichita police officer working undercover.
Sentencing is set for Oct. 26. He faces a penalty of up to three years in federal prison and a fine up to $250,000. The Wichita Police Department and the FBI investigated. Assistant U.S. Attorney Aaron Smith and Assistant U.S. Attorney Mona Furst are prosecuting.
Former City of Atlanta deputy chief of staff charged with accepting bribesRead the Press Release
ATLANTA - Evelyn Katrina Taylor-Parks has been charged with conspiring to accept bribe payments while serving as the City of Atlanta’s Deputy Chief of Staff to the Mayor.
“As the Deputy Chief of Staff, the City of Atlanta and its citizens placed immeasurable trust in Parks to act in the best interests of the city,” said U.S. Attorney Byung J. “BJay” Pak. “Public officials have a responsibility to lead with integrity. Regrettably, Parks allegedly exchanged the power and trust given to her for bribe money paid by a city contractor.”
“Great trust was placed in Parks as Deputy Chief of Staff and she is charged with abusing that position to serve her own financial interests,” said J. C. “Chris” Hacker, Special Agent in Charge of FBI Atlanta. “Because actions like this erode the public’s trust in government, the FBI will continue to vigorously pursue any public official who chooses to violate that trust.”
“Parks’ alleged engagement in personal benefit over the public’s trust cannot be tolerated as a high ranking city official,” said Thomas J. Holloman, Special Agent in Charge of IRS-Criminal Investigation Atlanta. “Pay to play politics will continue to drive IRS-CI and its partners to follow the money in this saga of city hall malfeasance.”
According to U.S. Attorney Pak, the charges, and other information presented in court: From approximately January 2010 to May 2018, Parks served as the Deputy Chief of Staff to the Mayor of the City of Atlanta, working with the Chief of Staff, Chief Operating Officer, and Department Commissioners to advance the administration’s legislative agenda with the Atlanta City Council. She also served as a representative on several community outreach committees. From 2011 to February 2014, Parks conspired to accept bribes from a vendor with the City of Atlanta. The vendor paid Parks thousands of dollars, and in return the vendor received tens of thousands of dollars for City of Atlanta contract work. Parks filed financial disclosure statements with the City of Atlanta in which she falsely attested that she was not self-employed or employed by any business or entity other than the City of Atlanta.
Evelyn Katrina Taylor-Parks, 49, of Douglas County, Georgia, has been charged in a criminal information with one count of conspiratorial bribery. Parks is expected to plead guilty to the charge at 3:00 p.m. on August 13, 2018, before U.S. District Judge Steve C. Jones.
This case is being investigated by the Federal Bureau of Investigation and the Internal Revenue Service.
Assistant U.S. Attorney Jeffrey W. Davis, Chief of the Public Integrity and Special Matters Sections, and Assistant U.S. Attorney Jill E. Steinberg, Deputy Chief of the Criminal Division are prosecuting the case.
For further information please contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6016. The Internet address for the U.S. Attorney’s Office for the Northern District of Georgia is http://www.justice.gov/usao-ndga.
Former CEO of Defense Contractor, Wellco Enterprises, Inc., Sentenced to 41 Months in Federal Prison for “Made in the USA” Marketing and Contract FraudRead the Press Release
GREENEVILLE, Tenn. – On August 6, 2018, the former President and Chief Executive Officer of Wellco Enterprises, Inc. (Wellco), and Tactical Holdings Operations, Inc. (Tactical Holdings), Vincent Lee Ferguson, 66, of Knoxville, Tennessee, was sentenced by the Honorable J. Ronnie Greer, U.S. District Judge, to serve 41 months in federal prison for his role in a wire fraud conspiracy.
Wellco’s former Senior Vice President of Sales, Matthew Lee Ferguson, 41, of Geneva, Illinois, and former Director of Marketing and Communications, Kerry Joseph Ferguson, 36, of Houston, Texas, were previously sentenced in June 2018 to each serve six months in federal prison for the same crime. There is no parole in the federal system.
Wellco was a leading manufacturer and supplier of military footwear to the U.S. Department of Defense (DoD) and to civilian customers for over 70 years. From 2006 through 2012, DoD alone paid in excess of $138 million to Wellco for the supply of combat boots. From December 2008 through August 2012, CEO Vincent Lee Ferguson conspired with his executive team to import military-style boots that were made in China into the U.S. and then deceptively market and sell those boots to DoD, government contractors, and the general public as “Made in the USA” and as compliant with the Berry Amendment and the Trade Agreements Act (TAA). The company sold over $8.1 million in fraudulent boots.
To conceal the fraud, the conspirators required the Chinese manufacturing facility to include “USA” on labels of boot uppers. After two shipments of these deceptively marked boots were seized by the U.S. Department of Homeland Security’s Customs and Border Protection, the conspirators ordered the Chinese facility to stitch tear-away “Made in China” labels in Wellco boot uppers. After importation, the conspirators instructed Wellco factory workers in Morristown, Tennessee, to tear out the “Made in China” tags prior to shipping the boots to government and commercial purchasers.
“The U.S. Attorney’s Office will prosecute aggressively, dishonest companies and individuals who take advantage of the United States, and potentially put our military men and women in danger, by fraudulently selling them counterfeit equipment which does not meet the standards set by the Berry Amendment and the TAA,” said U.S. Attorney J. Douglas Overbey.
John F. Khin, Special Agent in Charge, Southeast Field Office, Defense Criminal Investigative Service (DCIS) said, “While the United States continues to combat enemies foreign and domestic, corrupt individuals attempt to take advantage of our service members and exploit our Defense Department’s supply chain. DCIS investigations relentlessly pursue allegations of fraud, waste and abuse. This sentencing is one of countless examples of the impact DCIS and its law enforcement partners have to aggressively investigate these crimes and prosecute those responsible to the fullest extent of the law.”
“Ensuring the authenticity of the products within the military’s supply chain is of paramount importance to Homeland Security Investigations (HSI),” said Assistant Special Agent in Charge Robert Hammer, who oversees HSI’s operations in Tennessee. “Falsely selling our military millions of dollars of combat boots by saying they were ‘Made in the USA’ when they are actually Chinese-knockoffs not only defrauds the government, but it also defrauds the American soldier. Our soldiers rely on their equipment from their guns to their boots to protect this country and counterfeit products could fail at a moment when they need them the most.”
“The General Services Administration (GSA) Office of Inspector General will continue to work with our law enforcement partners to aggressively investigate contractors who fraudulently circumvent the federal procurement process,” said Special Agent in Charge, Floyd Martinez.
This case was investigated by HSI, DCIS, Air Force Office of Special Investigations, GSA Office of Inspector General, and Defense Contract Audit Agency. Assistant U.S. Attorneys David L. Gunn and Timothy Harker represented the United States in court proceedings.
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Florence Resident Sentenced in Federal Court for Manufacturing and Passing Counterfeit MoneyRead the Press Release
Columbia, South Carolina ---- Sherri A. Lydon stated today that Gary Jerome Smart, age 26, of Florence, South Carolina, was sentenced in federal court in Florence for conspiracy to manufacture and pass counterfeit money, a violation of Title 18, United States Code, Section 371. United States District Judge Bryan Harwell, of Florence, sentenced Smart to 20 months’ imprisonment followed by 3 years of supervised release.
The evidence presented at the guilty plea hearing established that Smart was involved in a conspiracy to manufacture and pass counterfeit $100 and $50 bills in multiple states including South Carolina and North Carolina. This conspiracy, which began in 2015, included at least nine codefendants who were responsible for producing and passing over $100,000 in counterfeit money.
Smart was directly involved in making counterfeit at various locations, including residences in Florence. In January 2017, he also passed counterfeit $100 bills at businesses in Greenville and Spartanburg, South Carolina.
The case was investigated by agents of United States Secret Service with the assistance of the Florence County Sheriff’s Office and the Florence Police Department. Assistant United States Attorney A. Bradley Parham of the Florence office prosecuted the case.
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Federal Inmate Sentenced on Weapon ChargeRead the Press Release
BECKLEY, W.Va. – United States Attorney Mike Stuart announced today that a federal inmate was sentenced to 24 months in prison for possessing a weapon at the Federal Correctional Institution at Beckley. Stuart praised the investigation conducted by the Federal Bureau of Prisons.
“Well, it’s not another shank,” said United States Attorney Mike Stuart,” but Guerrero is the latest inmate that lengthened his prison stay by possessing a weapon.”
Richard Ray Guerrero, 33, pled guilty in April, admitting that on June 30, 2017, he possessed a weapon he had made consisting of two combination locks attached to a belt. Staff members at the prison recovered the weapon from Guerrero following an altercation he had with another inmate. Guerrero’s sentence will run consecutively to the sentence he is now serving.
The case was prosecuted by Assistant United States Attorney John File. The sentence was imposed by United States District Judge Irene C. Berger.
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Federal Indictment Charges Two MS-13 Gang Members with Murder in Aid of Racketeering and Other ChargesRead the Press Release
A federal grand jury sitting in Nashville, Tennessee today, returned a five count indictment, charging two members of the MS-13 gang with murder in aid of racketeering, announced U.S. Attorney Don Cochran of the Middle District of Tennessee and Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division.
Oscar Degaldo Flores, aka Flaco, 24, of El Salvador, and Luis Colindres, aka Listo and Joe, 21, of Honduras, were also charged with conspiracy; witness tampering; using, carrying and discharging a firearm during and in relation to a crime of violence; and causing death through the use of a firearm.
The indictment alleges that on September 24, 2017, Flores and Colindres shot and killed an individual identified as “H.Z.” and also shot and killed another individual identified as “Y.H.,” in order to prevent that individual from communicating with law enforcement about the commission of their crimes, including the murder of “H.Z.”
If convicted, the defendants face up to life in prison.
This case is being investigated by the Bureau of Alcohol, Tobacco, Firearms & Explosives; the U.S. Drug Enforcement Administration; U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; and the Metropolitan Nashville Police Department. Assistant U.S. Attorneys Ahmed Safeeullah and Sunny A.M. Koshy of the Middle District of Tennessee and Trial Attorney Matthew Hoff of the Criminal Division’s Organized Crime and Gang Section are prosecuting the case.
An indictment in merely an accusation. The defendants are presumed innocent until proven guilty in a court of law.
Father and Son Plead Guilty to Selling Fentanyl and Oxycodone on the Dark WebRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that MICHAEL LUCIANO and PHILIP LUCIANO, a father and son, pled guilty today to selling fentanyl and oxycodone over the “dark web,” including on AlphaBay. Fentanyl is a synthetic opioid that is significantly more potent than heroin, and is a major contributor to overdose fatalities. The defendants also admitted to selling fentanyl that substantially contributed to a victim’s non-fatal overdose in 2015. MICHAEL LUCIANO and PHILIP LUCIANO pled guilty before United States Magistrate Judge Katharine H. Parker, and were remanded into federal custody.
Manhattan U.S. Attorney Geoffrey S. Berman said: “The defendants’ fentanyl contributed to a victim’s overdose, which fortunately, the victim survived. Subsequently, the defendants used the dark web – a place where some criminals think they can hide – to sell fentanyl and oxycodone, two highly addictive and potentially lethal opioids. I commend our partners at HSI for bringing this father-son duo’s misconduct out of the dark.”
According to the allegations in the Complaint and the Indictment to which the defendants pled guilty, as well as statements made in court:
From at least in or about January 2015 through July 2017, MICHAEL LUCIANO and PHILIP LUCIANO conspired to distribute fentanyl, butyryl fentanyl (a fentanyl analogue), and oxycodone. They sold these narcotics both in person and – from at least February 2016 through July 2017 – over the dark web. In March 2015, the LUCIANOs sold fentanyl to a repeat customer who overdosed, was administered naloxone, taken to the hospital, and survived. The overdose victim sent text messages to PHILIP LUCIANO from the hospital, stating, “I called you / Your dad at the house and saw him / I got back home and shot some. I thought it might have been too much, especially considering my last dose of sub was Saturday. I became unresponsive and my friend called an ambulance. They gave me narcan and I’m at the hospital now / Can I settle up and get 60 more tomorrow?” PHILIP LUCIANO replied, “Give me a call when u can.”
Despite this overdose in 2015, the LUCIANOs continued to sell drugs, including over the darkweb in 2016 and 2017. On AlphaBay, they sold narcotics using the vendor name “Zane61.” AlphaBay customers repeatedly provided positive feedback on fentanyl and oxycodone they purchased from Zane61. One of the LUCIANOs’ AlphaBay customers wrote, for example: “Great stealth, fast shipping, legit product. Perfect 10/10.” During a confession in July 2017, MICHAEL LUCIANO told HSI agents, among other things, that PHILIP LUCIANO had handled the technological aspects of their drug transactions over the darkweb, PHILIP had reported to MICHAEL drug orders they had received online, and MICHAEL had shipped the narcotics, via the United States Postal Service, to the LUCIANOs’ customers.
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MICHAEL LUCIANO, 59, and PHILIP LUCIANO, 30, both of Staten Island, each pled guilty to one count of conspiracy to distribute and possess with intent to distribute three controlled substances – fentanyl, butyryl fentanyl (a fentanyl analogue), and oxycodone. This charge carries a mandatory minimum sentence of five years in prison and a maximum sentence of 40 years in prison. The statutory maximum sentence is prescribed by Congress and is provided here for informational purposes only, as the defendants’ sentences will be determined by the judge. Sentencing has been scheduled for November 8, 2018, before United States District Judge Lewis A. Kaplan.
Mr. Berman praised HSI for its outstanding work on the investigation. Mr. Berman also thanked the U.S. Postal Inspection Service, U.S. Customs and Border Protection, and the New York City Police Department for their valuable assistance in this investigation.
This matter is being handled by the Office’s Narcotics Unit. Assistant United States Attorney Michael D. Neff is in charge of the prosecution.
FBI Agents Arrest Tucson Lawyer and his Assistant on Federal Obstruction of Justice Related ChargesRead the Press Release
This morning in Tucson, AZ, FBI agents arrested a local attorney and his assistant for allegedly obstructing justice, tampering with a witness and assisting an offender in avoiding apprehension in a criminal case, announced United States Attorney John F. Bash of the Western District of Texas and FBI Special Agent in Charge Michael DeLeon, Phoenix Field Office.
A federal grand jury indictment unsealed today charges 59-year-old Rafael F. Gallego and his 39-year-old assistant, Ricardo Gallego, with one count of conspiracy to obstruct justice; one count of conspiracy to commit false statements; one substantive count of obstruction of justice; one count of accessory after the fact; and, one count of conspiracy to tamper with a witness.
The indictment alleges that from January 2017 to October 2017, the defendants conspired to corruptly effect the administration of justice in a criminal matter pending in the United States District Court for the District of Arizona. The indictment alleges that the defendants provided false information to Homeland Security Investigations (HSI) agents, U.S. Customs and Border Protection (CBP) agents and an Assistant U.S. Attorney in the District of Arizona. The indictment further alleges that the defendants, having knowledge of the commission of a drug trafficking offense, provided assistance to the offender in order to hinder and prevent the offender’s apprehension, trial and punishment. The indictment also alleges that the defendants conspired to corruptly persuade an individual to provide false information to law enforcement investigators.
Upon conviction, the defendants face up to 20 years in federal prison for witness tampering; up to ten years in federal prison for obstruction of justice; and, up to five years in federal prison for the remaining conspiracy charges.
The FBI Phoenix Field Office’s Tucson Resident Agency is investigating this case with the assistance of HSI and CBP. The Pima County Sheriff’s Department assisted with today’s operation. Assistant U.S. Attorney Daphne Newaz of the Western District of Texas is prosecuting this case on behalf of the Government.
It is important to note that an indictment is merely a charge and should not be considered as evidence of guilt. The defendants are considered innocent until proven guilty in a court of law.
Eleven Defendants Charged in Conspiracy to Distribute Pure Methamphetamine and Heroin Resulting in the Seizure of over 20 Kilograms of Drugs and More Than $1 MillionRead the Press Release
Ocala, Florida – A federal indictment has been unsealed charging Charlie Wayne Harrison, Jr. (32, Leesburg), Trini Thomas, Jr. (34, Wildwood), Allison Nicole Valdez (32, St. Petersburg), James Edward Moss (34, LaGrange, Georgia), Dwayne Edward Moss (32, LaGrange, Georgia), Jasmine Janay Patterson (24, Wildwood), Georgiana Armenakis (40, Paisley), Derick Latrelle Woods (28, Belleview), Brian Adolph McLaren, Jr. (30, Ocala), Christopher Valsechi (28, Weirsdale), and Chantal Monique Harrison (28, Leesburg) with conspiracy to distribute 50 grams or more of methamphetamine. If convicted on all counts, each faces a maximum penalty of life imprisonment. The indictment also notifies Charlie Wayne Harrison, Jr. that the United States intends to forfeit his 2016 Porsche Panamera, 2014 Chevrolet Corvette, and 2008 Hummer H3, which are alleged to be traceable to proceeds of the offenses.
According to court records, Charlie Wayne Harrison, Jr. was the leader of a large-scale drug operation spanning Marion, Sumter, Lake, and Pinellas Counties. He and his co-conspirators are charged with distributing multi-kilogram quantities of pure crystal methamphetamine and heroin. During the investigation, the Drug Enforcement Administration seized 14.5 kilograms of pure crystal methamphetamine (96-100% pure), 5.5 kilograms of heroin, 19 firearms, and approximately 6 pounds of gold jewelry valued at approximately $95,000. In addition, law enforcement seized $1,171,353 in cash, alleged to be profits of Harrison’s drug organization.
“This investigation is evident of the law enforcement community’s ability to work together throughout various counties to fully investigate and bring to justice those involved in drug trafficking” said Adolphus P. Wright, Special Agent in Charge of the DEA Miami Field Division.
“As subject-matter experts in violent crime, firearms and explosives,” said ATF Special Agent in Charge Daryl McCrary, “We will continue to work with our law enforcement partners to keep illegal firearms out of our communities.”
“FDLE is pleased to participate with our partners in the successful effort to stop a massive, multi-county drug operation,” said John Burke, Special Agent in Charge – FDLE, Jacksonville Regional Operations Center. “Florida families in this region are now safer and more secure thanks to the combined work of law enforcement and the U.S. Attorney’s Office.”
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 (Gainesville Resident Office) in partnership with the Unified Drug Enforcement Strike Team in Marion County, as well as the Marion, Lake, and Sumter County Sheriffs’ Offices, the Florida Department of Law Enforcement, the St. Petersburg Police Department, and the Bureau of Alcohol, Tobacco, Firearms and Explosives. It will be prosecuted by Assistant United States Attorney Tysen Duva.
Dubuque Woman Pleads Guilty to Distributing HeroinRead the Press Release
A woman who distributed a fatal dose of methadone pled guilty on August 6, 2018, in federal court in Cedar Rapids.
Brianna Marie Martin, age 24, from Dubuque, Iowa, was convicted of one count of distribution of heroin.
Prior court documents reflect that on July 19, 2016, the Dubuque Drug Task Force investigated the death of an individual who had obtained heroin by using Martin as a connection to a heroin dealer. At the plea hearing, Martin admitted she had facilitated the heroin transaction. An autopsy determined that this individual died as a result of mixed drug toxicity involving methamphetamine and heroin. On July 28, 2016, the Dubuque Drug Task Force utilized a confidential source to arrange a controlled buy of heroin through Martin from the same drug dealer. At the plea hearing, Martin admitted that, during the July 28 controlled buy, she distributed heroin to the confidential source.
Martin also admitted that in July 2015, she was participating in a drug treatment program in Galena, Illinois. As a part of that program, she obtained a “take home” dose of methadone on a Saturday, for use on Sunday when the methadone clinic was closed. Martin admitted she would sometimes sell her “take home” dose of methadone to others. She admitted that on July 12, 2015, she distributed her “take home” dose to other individuals. On July 13, 2015, one of those individuals was found unresponsive and later pronounced dead. An autopsy determined that this individual died of complications of acute methadone intoxication.
Sentencing before Chief United States District Court Judge Leonard T. Strand will be set after a presentence report is prepared. Martin was taken into custody by the United States Marshal after the guilty plea and will remain in custody pending sentencing. Martin faces a possible maximum sentence of 20 years’ imprisonment, a $1,000,000 fine, and up to a lifetime term of supervised release following any imprisonment.
The case was investigated by the Dubuque Drug Task Force is being prosecuted by Assistant United States Attorney Dan Chatham.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 18-CR-1021-LTS.
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Drug Company Manager Admits Role in Kickback Scheme Related to Fentanyl Spray PrescriptionsRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that JEFFREY PEARLMAN, 51, of Edgewood, N.J., pleaded guilty today before U.S. District Judge Janet Bond Arterton in New Haven to engaging in a kickback scheme that defrauded federal healthcare programs.
According to court documents and statements made in court, from approximately September 2012 until November 2015, PEARLMAN was employed by Insys Therapeutics, an Arizona-based pharmaceutical company that manufactured and sold Subsys, a fentanyl-based sublingual spray that was approved by the Food and Drug Administration solely for the management of breakthrough pain in cancer patients. The company first hired PEARLMAN as a sales representative and subsequently promoted him to the position of District Sales Manager. As a District Sales Manager, PEARLMAN was responsible for managing the company’s sales representatives who called on licensed healthcare providers in Connecticut, New York, New Jersey and Rhode Island.
In pleading guilty, PEARLMAN admitted that he and the sales representatives he managed induced certain physicians, advanced practice registered nurses (APRNs) and physicians’ assistants to prescribe Subsys by paying them to participate in numerous sham “Speaker Programs.” The Speaker Programs, which were typically held at high-end restaurants in Connecticut and elsewhere, were ostensibly designed to gather licensed healthcare professionals who had the capacity to prescribe Subsys and educate them about the drug. In truth, the events were usually just a gathering of friends and co-workers, most of whom did not have the ability to prescribe Subsys, and no educational component took place. “Speakers” were paid a fee that ranged from $1,000 to several thousand dollars for attending these dinners.
In 2013, PEARLMAN attended a dinner at a New Haven restaurant where a Connecticut healthcare provider was paid a speaker fee even though no other healthcare professionals were present, and no presentation of Subsys took place.
In a meeting that occurred with the same Connecticut healthcare provider in the spring of 2013, PEARLMAN told the provider that the more prescriptions of Subsys that the provider wrote, the more Speaker Programs PEARLMAN could provide. In June 2013, when these prescriptions were not initially being written as planned, PEARLMAN emailed the Insys sales representative who was responsible for calling on the provider and reiterated that per the “verbal agreement” PEARLMAN had made with the provider, the provider needed to write more Subsys prescriptions or he was “going to have tremendous difficulty in justifying more [speaker] programs.”
As a result of this scheme, Medicare Part D plans authorized payment for nearly 400 Subsys prescriptions made by the Connecticut healthcare provider, causing millions of dollars of losses. PEARLMAN personally profited from this scheme through inflated quarterly bonuses he received that were based in large part on the sales results of the sales representatives he managed.
PEARLMAN pleaded guilty to one count of conspiracy to violate the anti-kickback law, an offense that carries a maximum term of imprisonment of five years and a fine of up to $250,000. Judge Arterton scheduled sentencing for October 31, 2018.
PEARLMAN was arrested on September 29, 2016. He is released on a $200,000 bond pending sentencing.
This investigation is being conducted by the U.S. Department of Health and Human Services Office of the Inspector General and the Federal Bureau of Investigation, with the assistance of the Drug Enforcement Administration’s Tactical Diversion Squad. The case is being prosecuted by Assistant U.S. Attorneys Douglas P. Morabito, Sarah P. Karwan and Richard M. Molot.
Several other individuals affiliated with Insys Therapeutics, and medical practitioners involved in this kickback scheme, have been charged in the District of Connecticut and in other Districts across the United States.
U.S. Attorney Durham encouraged individuals who suspect health care fraud to report it by calling the Health Care Fraud Task Force (203) 785-9270 or 1-800-HHS-TIPS.
District Men Indicted on Federal Charges in Heroin and Crack Cocaine ConspiracyRead the Press Release
WASHINGTON – Saint Vincent Harris, 22, and Anthony Dickey, 24, both of Washington, D.C., have been indicted on federal charges stemming from an alleged conspiracy to deal heroin and crack cocaine in Northwest and Southwest Washington. Harris also has been indicted on related federal firearms charges.
The indictment was announced by U.S. Attorney Jessie K. Liu, Nancy McNamara, Assistant Director in Charge of the FBI’s Washington Field Office, Peter Newsham, Chief of the Metropolitan Police Department (MPD), and Edwin C. Roessler Jr., Chief of the Fairfax County, Va. Police Department.
The indictment was returned on Aug. 7, 2018, by a grand jury in the U.S. District Court for the District of Columbia. Both men were arrested on the night of Aug. 7 during the execution of search warrants by law enforcement. Harris and Dickey were each indicted on one count of conspiring to distribute and possess with intent to distribute heroin and cocaine base. Harris also was indicted on four counts of unlawful distribution of heroin; four counts of unlawful distribution of cocaine base, and two related firearms offenses. The indictment includes a forfeiture allegation seeking all proceeds that can be attributed to the crimes.
Both men were arraigned this afternoon at a hearing before the Honorable G. Michael Harvey. They pled not guilty and were ordered held pending a hearing set for Aug. 13, 2018.
According to the government’s evidence, the drug conspiracy began in October 2017 and was still taking place. Harris and Dickey allegedly utilized a “stash house” in Northwest Washington, out of which crack cocaine and heroin were sold to members of the community. Drug customers from the District of Columbia and Virginia traveled to the location to purchase narcotics. During the course of the conspiracy, according to the evidence, multi-ounce quantities of both crack cocaine and heroin were sold. During one of the transactions, Harris also allegedly sold a firearm to a customer.
Harris faces a mandatory minimum of 10 years and a maximum of life in prison if convicted of the charges. Dickey faces a mandatory minimum of five years and up to 40 years in prison if convicted of the charge against him. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes. If convicted of any offense, a defendant’s sentence will be determined by the court based on the advisory U.S. Sentencing Guidelines and other statutory factors.
An indictment is merely a formal charge that a defendant has committed a violation of criminal laws and every defendant is presumed innocent until, and unless, proven guilty.
This case is being investigated by the FBI’s Washington Field Office, the Metropolitan Police Department, and the Fairfax County Police Department. It is being investigated and prosecuted by the Violent Crime and Narcotics Trafficking Section of the U.S. Attorney’s Office for the District of Columbia.
District Man Sentenced to 13 Years in Prison for Sexually Assaulting Teenage DaughterRead the Press Release
WASHINGTON – A 43-year-old man, formerly of Northwest Washington, D.C., was sentenced today to 13 years in prison for repeatedly sexually abusing his teenage daughter, U.S. Attorney Jessie K. Liu announced.
The defendant, who is not identified here to protect the privacy of the victim, pled guilty in March 2018, in the Superior Court of the District of Columbia, to charges of first-degree child sexual abuse and attempted second-degree sexual abuse of a minor. He was sentenced by the Honorable Danya A. Dayson. Upon completion of his prison term, the defendant will be placed on 10 years of supervised release. He also will be required to register as a sex offender for the remainder of his life.
According to the government’s evidence, the defendant sexually abused his daughter from age 12 to 16. On Sept. 25, 2017, he pressured his daughter into drinking so much alcohol that she became seriously ill and passed out. The next morning, he performed a sexual act on her. The victim reported the abuse shortly after this incident. On a call recorded by law enforcement between the defendant and the victim, the defendant admitted to surreptitiously giving the victim “Plan B” birth control medicine and instructed his daughter to lie to law enforcement about his actions.
The defendant was arrested on Sept. 29, 2017, and has been in custody ever since. At the time of this conduct, he was on supervised release after serving more than 11 years in prison on narcotics charges. He now will face revocation proceedings before the U.S. Parole Commission.
In announcing the sentence, U.S. Attorney Liu commended the work of those who investigated the case from the Metropolitan Police Department’s Youth and Family Services Division. She also expressed appreciation for the work of those who handled the case at the U.S. Attorney’s Office, including Victim/Witness Advocates Juanita Harris and Lezlie Richardson, Paralegal Specialist Tiffany Jones, and Assistant U.S. Attorneys Julianne Johnston and J. Matt Williams, who prosecuted the case.
Defendant Charged with Importation of More than 20,000 Fentanyl Pills at the San Ysidro Port of EntryRead the Press Release
Assistant U. S. Attorney Sherri Walker Hobson (619) 961-0287
NEWS RELEASE SUMMARY – August 9, 2018
SAN DIEGO – Fernando Jesus Peraza, a U.S. citizen living in Tijuana, was arraigned in federal court today on charges of importing over 20,000 fentanyl pills in what is believed to be the largest seizure of fentanyl in pill form along the U.S.-Mexico border.
Peraza, who works in San Diego County, was arrested at the San Ysidro Port of Entry today at 2:30 a.m. According to court records, Peraza was the driver, registered owner and sole occupant of the vehicle. U.S. Custom Border & Protection officers initially contacted Peraza in preprimary inspection area but was then referred to secondary inspection, where officers found four packages concealed in the passenger side rear quarter panel. The pills tested positive for fentanyl but were designed to resemble M30s, or oxycodone.
At Peraza’s initial appearance today before U.S. Magistrate Judge Jill Burkhardt, the United States requested detention based on risk of flight. Judge Burkhardt scheduled a detention hearing for August 10, 2018 at 10:00 a.m. and a preliminary hearing for August 21, 2018 at 9 a.m.
Earlier this month, Cristian Araujo Aguirre, 19 of Tijuana, was charged with importing 11,490 fentanyl pills, 61 pounds of methamphetamine and 14 pounds of heroin. Aguirre was arrested at the San Ysidro Port of Entry on August 1, 2018. Aguirre is currently detained. His next court appearance is on August 31, 2018.
“This is the biggest fentanyl pill seizure we’ve seen along the Southwest Border, and it’s likely a national record,” said U.S. Attorney Adam Braverman. “I’m relieved that these pills are off the streets because of the vigilant work of law enforcement. But that relief is tempered by the fact that people are overdosing every day because they took fentanyl-laced pills just like these, oblivious to the deadly consequences.”
DEFENDANT Case Number 18MJ4376
Fernando Jesus Peraza Age: 38 Tijuana, Mexico
SUMMARY OF CHARGES
Importation of Controlled Substances
Maximum penalty: Ten years minimum to life; $1 million fine
INVESTIGATING AGENCIES
Homeland Security Investigations
U.S. Customs & Border Protection
*The charges and allegations contained in an indictment or complaint are merely accusations, and the defendants are considered innocent unless and until proven guilty.
Convicted Sex Offender Pleads Guilty to Child Pornography ChargeRead the Press Release
ALEXANDRIA, Va. – A Fairfax man who is a registered sex offender pleaded guilty today to downloading images of child sexual abuse.
According to court documents, Christopher James Tator, 31, was discovered by the FBI Washington Field Office’s Child Exploitation and Human Trafficking Task Force making child pornography files available over an Internet file-sharing network. A computer forensic examination of devices seized from Tator’s residence during a search warrant revealed that he had used a computer to download child pornography videos from a Dropbox cloud storage account. Tator’s devices also contained hundreds of thumbnail images of children being sexually abused, many of which depicted the sexual abuse of infants. Tator is a registered sex offender as a result of a 2010 Prince William County conviction of attempting to take indecent liberties with children.
Tator pleaded guilty to receipt of child pornography by person with a prior conviction relating to aggravated sexual abuse, sexual abuse, or abusive sexual conduct involving a minor. He faces a mandatory minimum sentence of 15 years in prison and a maximum sentence of 40 years when sentenced on November 2. 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 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 Nancy McNamara, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after Senior U.S. District Judge T.S. Ellis III accepted the plea. Special Assistant U.S. Attorney Kyle P. Reynolds is prosecuting the case.
The FBI Washington Field Office’s Child Exploitation and Human Trafficking Task Force is comprised of agents of the FBI, U.S. Marshals, and detectives from the Prince William County Police, Fairfax County Police, Loudoun County Sheriff’s Office, Metropolitan Police, Alexandria City Police, Arlington County Police, Leesburg Police, Virginia State Police and the Offices of Inspector General of several federal agencies.
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-294.
Convicted Felon Sentenced to Forty-Six Months of Imprisonment for Possessing A Firearm and AmmunitionRead the Press Release
SAN FRANCISCO –Kevin Mitchell was sentenced to 46 months in prison for possessing a firearm and ammunition after being previously convicted of a felony, announced United States Attorney Alex G. Tse and Federal Bureau of Investigation (FBI) Special Agent in Charge John F. Bennett. The sentence was handed down today by the Honorable Edward M. Chen, United States District Judge.
Mitchell pleaded guilty to the charge on May 16, 2018. According to his plea agreement, Mitchell admitted that he was carrying a loaded firearm inside his vehicle in San Francisco on December 15, 2017. At the time, he was a convicted felon and was not eligible to possess a firearm. The firearm was a .45 caliber handgun with a large capacity magazine attached to it. In additions, the magazine contained twenty-six rounds of ammunition. On March 1, 2018, a federal grand jury indicted Mitchell charging him with one count of being a felon in possession of a firearm, in violation of 18 U.S.C. § 922(g)(1).
In addition to the prison term, Judge Chen also ordered Mitchell to serve a three-year term of supervised release to begin at the conclusion of his prison term.
Assistant United States Attorney Neal C. Hong is prosecuting the case with the assistance of Kimberly Richardson. The prosecution is the result of an investigation by the Federal Bureau of Investigation and the San Francisco Police Department.
Congressman Christopher Collins and Others Charged in Manhattan Federal Court with Insider Trading and Lying to Federal Law Enforcement AgentsRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, and William F. Sweeney Jr., the Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today the arrests of CHRISTOPHER COLLINS, a Congressman representing the 27th District of New York, CAMERON COLLINS, the son of CHRISTOPHER COLLINS, and STEPHEN ZARSKY, the father of CAMERON COLLINS’s fiancée, on charges of participating in a scheme to commit insider trading relating to securities of Innate Immunotherapeutics (“Innate”), an Australian biotechnology company on whose Board of Directors CHRISTOPHER COLLINS served. As alleged in the Indictment, in June 2017, CHRISTOPHER COLLINS, who possessed material, nonpublic information through his service on Innate’s board of directors, betrayed his duties of trust and confidence to Innate by providing inside information to his son, CAMERON COLLINS, about confidential drug trial results so that his son and others, including ZARSKY, could trade before the drug trial results were publicly announced. As a result of CHRISTOPHER COLLINS’s illegal tips, CAMERON COLLINS, ZARSKY, and others who received the inside information avoided a total of approximately $768,000 in losses. When later interviewed by the FBI, CHRISTOPHER COLLINS, CAMERON COLLINS, and ZARSKY each made false statements to cover up their participation in the insider trading scheme.
CHRISTOPHER COLLINS, CAMERON COLLINS, and ZARSKY are each charged with conspiracy, securities fraud, wire fraud, and making false statements to the FBI. All three defendants surrendered this morning and will be presented and arraigned at 2:30 p.m. today before United States District Judge Vernon S. Broderick in federal court in the Southern District of New York.
In a separate action, the United States Securities and Exchange Commission (“SEC”) filed a civil action against CHRISTOPHER COLLINS, CAMERON COLLINS, and ZARSKY.
U.S. Attorney Geoffrey S. Berman said: “Congressman Christopher Collins is charged with insider trading and lying to the FBI, as are his son, Cameron Collins, and Stephen Zarsky, the father of Cameron’s fiancée. As alleged, Christopher Collins tipped confidential corporate information to his son, who traded on the inside information and passed it on to others, including Zarsky. Zarsky allegedly also traded on the information and tipped others. Representative Collins, who, by virtue of his office, helps write the laws of this country, acted as if the law did not apply to him. These charges are a reminder that this is a nation of laws, and everyone stands equal before the bar of justice. The charges demonstrate again that no matter what the alleged crime, or who allegedly committed it, we stand dedicated to the pursuit of justice, without fear or favor.”
FBI Assistant Director-in-Charge William F. Sweeney Jr. said: “Congressman Christopher Collins sat on Innate Immunotherapeutics’ Board of Directors for a period of more than three years, spanning the run-up to the company’s clinical drug trial announcement in 2017. When he received confidential information that the drug had failed its trial, he tipped off investors with whom he shared a personal relationship, as we allege. Congressman Collins thought giving his family and friends a heads-up about material, nonpublic information would benefit them in the long run, but here's a better inside tip for those who think they can play by different rules: Access to this kind of information carries with it a significant responsibility, especially for those who hold a position of trust in our society. Act honorably and in accordance with the law, and do not lie to a special agent of the FBI.”
According to the allegations in the Indictment unsealed today in Manhattan federal court:[1]
The Insider Trading Scheme
The Scheme
In or about June 2017, CHRISTOPHER COLLINS, who, in addition to serving on Innate’s board of directors, was also one of Innate’s largest shareholders, participated in a scheme to commit insider trading. Specifically, on or about June 22, 2017, CHRISTOPHER COLLINS learned that MIS416 – a multiple sclerosis drug that Innate was developing – had failed a critical drug trial that was meant to determine the drug’s clinical efficacy (the “Drug Trial”). The negative Drug Trial results were highly confidential, and, as an insider who owed duties of trust and confidence to Innate, CHRISTOPHER COLLINS was obligated to keep the Drug Trial results secret until Innate publicly released them. Instead, in breach of those duties, CHRISTOPHER COLLINS tipped his son, CAMERON COLLINS, who was also a substantial Innate shareholder, so that CAMERON COLLINS could make timely trades and tip others before Innate publicly released the Drug Trial results. CAMERON COLLINS traded on the inside information and passed it to ZARSKY, as well as to three conspirators not named in the Indictment (“CC-1,” “CC-2,” and “CC-6”), so that they could utilize the information for the same purpose. ZARSKY, in turn, traded on the information and used it to tip three more conspirators not named in the Indictment (“CC-3,” “CC-4,” and “CC-5,”) so that they too could engage in timely trades in Innate stock. All of the trades preceded the public release of the negative Drug Trial results.
In total, these trades allowed CHRISTOPHER COLLINS, CAMERON COLLINS, and ZARSKY, as well as CC-1 through CC-6, to avoid over $768,000 in losses that they would have otherwise incurred if they had sold their stock in Innate after the Drug Trial results became public.
The Drug Trial Results
In or about October 2014, Innate initiated a Phase 2B clinical trial of its primary drug, MIS416. Successful completion of the Drug Trial was a necessary prerequisite to the commercialization of MIS416. Because Innate had no other significant products in development, its stock price was tied to the success of MIS416.
The Drug Trial was widely expected to be completed around the summer of 2017. For example, on or about June 9, 2017, Innate’s chief executive officer (“CEO”) sent various individuals, including CHRISTOPHER COLLINS, an email stating that “the delivery date for [the] review and ‘verdict’” of the Drug Trial “will [] occur at COB on US Thursday June 22nd.” As the summer progressed, individuals within Innate remained optimistic that MIS416’s Drug Trial results would be positive. The initial Drug Trial results were made available by trial administrators to Innate’s CEO on June 22, 2017. These results established that MIS416 lacked therapeutic value in the treatment of multiple sclerosis. The results were not publicly released at that time. Instead, they were released publicly on June 26, 2017, after the U.S. markets had closed (the “Public Announcement”). Innate’s stock price subsequently crashed, dropping 92% on the first trading day following the Public Announcement.
Dissemination of the Drug Trial Results
On or about June 22, 2017, at approximately 6:55 p.m., Innate’s CEO sent an email describing the Drug Trial results to the company’s board of directors, including CHRISTOPHER COLLINS. The email explained to Innate’s board of directors for the first time that the Drug Trial had been a failure. The email began, in part, “I have bad news to report,” and continued to explain that “the top line analysis of the ‘intent to treat’ patient population (ie every subject who was successfully enrolled in the study) would pretty clearly indicate[s] ‘clinical failure.’” The email continued, “Top-line 12-month data . . . show no clinically meaningful or statistically significant differences in [outcomes] between MIS416 and placebo,” and concluded by stating, “No doubt we will want to consider this extremely bad news. . . .”
At the time CHRISTOPHER COLLINS received this email, he was attending the Congressional Picnic at the White House. At 7:10 p.m., CHRISTOPHER COLLINS replied to the email, stating, in part, “Wow. Makes no sense. How are these results even possible???” After responding to the Innate CEO’s email, CHRISTOPHER COLLINS called his son, CAMERON COLLINS. They traded six missed calls between 7:11 p.m. and 7:15 p.m.. At 7:16 p.m., CHRISTOPHER COLLINS and CAMERON COLLINS spoke for more than six minutes. During that six-minute phone call, CHRISTOPHER COLLINS told CAMERON COLLINS, in sum and substance, that MIS416 had failed the Drug Trial.
CHRISTOPHER COLLINS did not trade himself, and his Innate stock ultimately declined by millions of dollars in value when the Drug Trial results were made public on June 26, 2017. As CHRISTOPHER COLLINS well knew, however, he was virtually precluded from trading his own shares for practical and technical reasons. For example, CHRISTOPHER COLLINS was already under investigation by the Office of Congressional Ethics (“OCE”) in connection with his holdings in, and promotion of, Innate. Indeed, he had been interviewed by OCE personnel on or about June 5, 2017, just 17 days earlier. Accordingly, he did not trade his own stock and instead tipped CAMERON COLLINS.
Trading and Tipping by CAMERON COLLINS and ZARSKY
CAMERON COLLINS began placing orders to sell his Innate shares the morning after he received inside information from CHRISTOPHER COLLINS. Between the morning of Friday, June 23, 2017, and the close of the market on Monday, June 26, 2017, CAMERON COLLINS sold approximately 1,391,500 shares of Innate stock. These sales allowed CAMERON COLLINS to avoid approximately $570,900 in losses.
Furthermore, after learning the Drug Trial results from CHRISTOPHER COLLINS, on or about the night of June 22, 2017, CAMERON COLLINS provided the Drug Trial results to at least the following three sets of individuals so that they could trade in advance of the Public Announcement: (1) his now fiancée, CC-1; (2) ZARSKY and ZARSKY’s wife, CC-2; and (3) CAMERON COLLINS’s friend, CC-6. Collectively, these individuals avoided approximately $186,620 in losses as a result of their trading on inside information.
On or about the morning of June 23, 2017, ZARSKY provided the negative Drug Trial results that he had learned from CAMERON COLLINS and CC-1 to at least the following individuals, among others, or otherwise caused them to trade or attempt to trade in advance of the Public Announcement: (1) his brother, CC-3; (2) his sister, CC-4; and (3) his longstanding friend, CC-5. Collectively, these individuals avoided approximately $10,900 in losses as a result of their trading on inside information.
Concealment of Trading
After the Public Announcement, CHRISTOPHER COLLINS took steps to prevent the public from learning that CAMERON COLLINS had sold significant portions of his Innate stock on or about June 23, 2017, and June 26, 2017, before the Public Announcement. For example, on or about June 28, 2017, one of CHRISTOPHER COLLINS’s staff members issued a statement to a local reporter. This statement stated that “Neither Christopher Collins, [nor] his daughter . . . have sold shares prior, during or after Innate’s recent stock halt,” and that “Cameron Collins has liquidated all his shares after the stock halt was lifted, suffering a substantial financial loss.” This statement was written in a manner designed to mislead the public into believing that CAMERON COLLINS had not sold any Innate shares prior to the Public Announcement. As CHRISTOPHER COLLINS explained in an email about press coverage surrounding Innate, “We want this to go away.”
False Statements to the FBI
On or about April 25, 2018, Special Agents from the FBI separately interviewed CHRISTOPHER COLLINS, CAMERON COLLINS, and ZARSKY. During these interviews, and as detailed in the Indictment, CHRISTOPHER COLLINS, CAMERON COLLINS, and ZARSKY made false statements to the FBI to cover up their participation in the insider trading scheme.
* * *
A chart identifying the charges and the maximum penalties applicable to CHRISTOPHER COLLINS, CAMERON COLLINS, and ZARKSY is below.
Count
Charge
Defendants
Maximum Penalty
1
Conspiracy to commit securities fraud (18 U.S.C. § 371)
All
5 years in prison
2
Securities fraud (15 U.S.C. §§ 78j(b) & 78ff; Title 18 U.S.C. § 2)
CHRISTOPHER COLLINS; CAMERON COLLINS
20 years in prison
3
Securities fraud (15 U.S.C. §§ 78j(b) & 78ff; Title 18 U.S.C. § 2)
All
20 years in prison
4
Securities fraud (15 U.S.C. §§ 78j(b) & 78ff; Title 18 U.S.C. § 2)
CHRISTOPHER COLLINS; CAMERON COLLINS
20 years in prison
5-7
Securities fraud (15 U.S.C. §§ 78j(b) & 78ff; Title 18 U.S.C. § 2)
All
20 years in prison
8
Securities fraud (15 U.S.C. §§ 78j(b) & 78ff; Title 18 U.S.C. § 2)
CHRISTOPHER COLLINS; CAMERON COLLINS
20 years in prison
9
Conspiracy to commit wire fraud (18 U.S.C. §§ 1349)
All
20 years in prison
10
Wire fraud (18 U.S.C. §§ 1343 & 2)
All
20 years in prison
11
False Statements (18 U.S.C. §§ 1001 & 2)
CHRISTOPHER COLLINS
5 years in prison
12
False Statements (18 U.S.C. §§ 1001 & 2)
CAMERON COLLINS
5 years in prison
13
False Statements (18 U.S.C. §§ 1001 & 2)
STEPHEN ZARSKY
5 years in prison
Defendants’ Ages and Residences
Defendant
Residence
Age
Christopher Collins
Clarence, New York
68
Cameron Collins
Morristown, New Jersey
25
Stephen Zarsky
Summit, New Jersey
66
The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendants will be determined by the judge.
Mr. Berman praised the work of the FBI and thanked the SEC for its assistance.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Scott Hartman, Robert W. Allen, Max Nicholas, and Damian Williams are in charge of the prosecution.
The allegations contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Indictment, and the description of the Indictment set forth herein, constitute only allegations, and every fact described should be treated as an allegation.
Colorado Business Owner Pleads Guilty to $7 Million Biodiesel Tax Credit Fraud SchemeRead the Press Release
A Colorado business owner pleaded guilty today to conspiracy to impair and impede the Internal Revenue Service (IRS) for his role in a $7.2 million renewable fuel tax credit scheme, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.
According to court documents, Calvin Glover of Parker, Colorado, owned Colorado-based renewable fuel company, Shintan, Inc. Glover conspired with others to file more than $7 million in false claims for refundable fuel tax credits with the IRS. Glover signed at least 23 false tax returns that claimed over $7.2 million in bogus refundable biodiesel mixture tax credits. Based on these false claims, the IRS issued over $7 million in refunds to Shintan Inc. After receiving the refunds checks, Glover deposited the checks into a bank account that he controlled and then transferred the proceeds to his co-conspirators.
In response to two grand jury subpoenas issued during the investigation, Glover provided false documents and information to investigators and met with co-conspirators to concoct a false story, all intended to obstruct the IRS’ ongoing criminal investigation.
Glover faces a maximum sentence of 5 years in prison, as well as a period of supervised release, restitution and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman thanked special agents of IRS Criminal Investigation and Environmental Protection Agency Criminal Investigation Division, who investigated the case, and Tax Division Trial Attorneys Leslie A. Goemaat and Arthur J. Ewenczyk, who are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website: www.justice.gov/tax.
Butts County Convicted Felon Sentenced for Possessing A Firearm Under Project Safe NeighborhoodsRead the Press Release
ATHENS: Charles E. Peeler, United States Attorney for the Middle District of Georgia, announces that today, Benjamin Blackburn, aged 50, of Jackson, Georgia, was sentenced to 43 months imprisonment for Possession of a Firearm by a Convicted Felon by United States District Judge C. Ashley Royal in Athens.
At his plea hearing, Mr. Blackburn admitted that on June 29, 2017, officers with the Athens-Clarke County Police Department and Federal Bureau of Investigation executed a search warrant at his residence. The warrant authorized a search for a revolver, bullet holes inside the house, ammunition, and any other firearms owned by Mr. Blackburn. Mr. Blackburn also had an active arrest warrant in Athens-Clarke County for Aggravated Assault-Strangulation, Battery, and Possession of a Firearm by a Convicted Felon, all arising from an alleged June 10, 2017 assault. Mr. Blackburn refused to exit the residence, ultimately leading to law enforcement deploying multiple CS gas rounds into the home before a SWAT team was able to apprehend Mr. Blackburn. A subsequent search revealed an FN Herstal Police Shotgun and a Taurus, .38 caliber revolver.
Mr. Blackburn was prohibited from possessing a firearm due to convictions for Felony Possession of a Controlled Substance in Williamson County, Texas in 1986; Felony Possession of Methamphetamine in Williamson County, Texas in 1989; and Aggravated Assault with a Deadly Weapon in Travis County, Texas in 2000.
“Mr. Blackburn has a demonstrated history of violence, and as a felon, he never should have picked up a gun,” said U.S. Attorney Charles E. Peeler. “Now he is headed to federal prison, from which there is no parole. I thank our local and federal law enforcement partners who worked together to bring Mr. Blackburn safely to justice.”
This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions has made turning the tide of rising violent crime in America a top priority. In October 2017, as part of a series of actions to address this crime trend, Attorney General Sessions announced the reinvigoration of PSN and directed all U.S. Attorney’s Offices to develop a district crime reduction strategy that incorporates the lessons learned since PSN launched in 2001.
The case was investigated by the Athens-Clarke County Police Department and the Federal Bureau of Investigation. Assistant United States Attorney Peter D. Leary prosecuted the case for the United States.
Questions concerning this case should be directed to Pamela Lightsey, Public Information Officer, United States Attorney’s Office, at (478) 621-2603.
Buffalo Man Convicted on State Murder Charge Sentenced on Federal Heroin ChargeRead 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 Jeffrey Brown, 43, of Buffalo, NY, who was convicted of conspiracy to possess with intent to distribute, and distribute, 100 grams or more of heroin, was sentenced to serve 120 months in federal prison by U.S. District Judge Lawrence J. Vilardo.
Assistant U.S. Attorney Michael J. Adler, who handled the case, stated that on November 17, 2016, law enforcement officers conducting a drug investigation arrested the defendant when he arrived at a pre-arraigned location to conduct a drug transaction. As Brown was being taken into custody, he dropped a bag of heroin. Subsequent investigation determined that the defendant had previously purchased 700 grams of heroin.
In January 2018, Brown pleaded guilty to Manslaughter in the 1st Degree in New York State Court and is awaiting sentencing on that conviction.
Today’s sentencing is the result of an investigation by the Drug Enforcement Administration, under the direction of Special Agent-in-Charge James J. Hunt, New York Field Division, the Buffalo Police Department, under the direction of Commissioner Byron Lockwood, and the Cheektowaga Police Department, under the direction of Chief David Zack.
Biotechnology Executive Convicted of Defrauding Investors and Making False Statements to Federal Law EnforcementRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today the conviction in Manhattan federal court of PATRICK MURACA for wire fraud and making false statements. The jury found MURACA guilty on both counts of the Superseding Indictment following a trial before United States District Judge Ronnie Abrams.
U.S. Attorney Geoffrey S. Berman stated: “Patrick Muraca, who promised investors their money would be used to expand his businesses, instead used those funds for personal expenses, including rent, payments on two mortgages, and expenses related to his fiancée’s restaurant. Thanks to the investigative work of the FBI, Muraca has been convicted of his fraudulent scheme.”
According to the allegations contained in the Complaint, the Superseding Indictment, and the evidence presented in Court during the trial:
In 2016, MURACA, the former President of Nuclea Biotechnologies, Inc., founded two new businesses: NanoMolecularDX LLC (“NMDX”) and MetaboRx LLC (“Metabo”). Between 2016 and July 2017, MURACA solicited and obtained more than approximately $1 million from investors by making false and misleading representations that the investors’ money would be used to expand the business of NMDX and Metabo. MURACA then misappropriated hundreds of thousands of dollars of investors’ funds and used the misappropriated money for personal expenses. For example, MURACA spent tens of thousands of dollars of investor funds on rent, utilities, and food distributor expenses related to the operation of a restaurant owned by his fiancée. In addition, MURACA wrote more than approximately $175,000 in checks to himself from the bank accounts associated with NMDX and Metabo. MURACA also used investor funds to make payments on his mortgage and the mortgage on a home belonging to his mother and for hundreds of dollars in purchases at a cigar store and a tattoo and piercing establishment, among other businesses.
MURACA was arrested by the Federal Bureau of Investigation (“FBI”) in July 2017. On November 17, 2017, MURACA met with a Special Agent with the FBI and an Assistant United States Attorney. In the course of the November 17, 2017 meeting, Muraca made a material false statement about his use of investor funds.
* * *
MURACA, 49, of Pittsfield, Massachusetts, was found guilty of one count of wire fraud, which carries a maximum term of 20 years in prison, and one count of making false statements to federal law enforcement, which carries a maximum term of five years in prison. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. A sentencing date has not yet been set.
Mr. Berman praised the outstanding investigative work of the FBI.
The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant United States Attorneys David Abramowicz, Katherine Reilly, and Christopher DiMase are in charge of the prosecution.
Bay Area Resident Sentenced to More Than Nine Years in Prison for Engaging in Illicit Sexual Conduct with A Minor in Foreign CountryRead the Press Release
SAN FRANCISCO – Douglas Peacock was sentenced today to 115 months in prison for traveling to a foreign country and engaging in illicit sexual conduct with a minor, announced United States Attorney Alex G. Tse and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) Special Agent in Charge in Northern California and Northern Nevada Ryan L. Spradlin. The sentence was handed down by the Honorable Charles R. Breyer, U.S. District Judge.
“Today, the Court imposed a sentence commensurate with the egregiousness of the crime committed,” said U.S. Attorney Tse. “This case demonstrates the borderless nature of crimes against children and this Office’s dedication to prosecute those crimes, protect the community, and bring justice to child victims and their families.”
“Homeland Security Investigations has one of the largest cadres of criminal investigators and allies globally that are highly trained and uniquely equipped to identify and arrest those who are involved in the exploitation of our most vulnerable citizens,” said Special Agent in Charge Spradlin. “Thanks to our work with our attaché in Jamaica, we were able to ensure this child molester was not only held accountable in a foreign country, but that he was prosecuted, will serve time, and be registered as sex offender here in the U.S. to help keep others safe from potential threat.”
Peacock, 44, of Foster City, pleaded guilty to the charge on April 25, 2018. In pleading guilty, Peacock admitted that he traveled from the United States to Jamaica on June 20, 2017, and on the following day engaged in illicit sexual conduct with a minor. Specifically, Peacock, while in the pool of a family-friendly resort in Jamaica, molested a six-year-old U.S. citizen. A federal grand jury indicted Peacock on November 2, 2017, charging him with one count of engaging in illicit sexual conduct in foreign places, in violation of 18 U.S.C. § 2423(c).
In addition to the prison term, Judge Breyer also ordered Peacock to serve a 10-year period of supervised release, which will begin after his prison term is over, and to register as a sex offender.
Peacock has been in federal custody since being returned to the United States on November 10, 2017, and will begin serving his sentence immediately.
The case is being prosecuted by Assistant U.S. Attorney Shiao Lee with the assistance of Kimberly Richardson and Marina Ponomarchuk. The case was investigated by HSI in San Francisco and Ohio with assistance from the HSI attaché in Kingston, Jamaica.