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18 July 2018
Turtle Creek Brothers Charged with Violating Federal Drug, Gun and Witness Tampering LawsRead the Press Release
PITTSBURGH – Two Allegheny County residents have been indicted by a federal grand jury in Pittsburgh on charges of violating federal drug, firearms, and witness tampering laws, United States Attorney Scott W. Brady announced today.
The nine-count superseding indictment named Julian Gray, age 26, and Brandon Gray, age 24, of Turtle Creek, Pa., as the defendants.
According to the superseding indictment, on April 24, 2018 and June 4, 2018, Julian Gray and Brandon Gray conspired to distribute and to possess with the intent to distribute heroin, cocaine, and cocaine base, and possessed with the intent to distribute quantities of heroin, cocaine, and cocaine base. The superseding indictment also alleges that on April 24, 2018, Julian Gray possessed a (1) a Ruger .380 LCP caliber handgun; (2) a Mossberg 12 gauge shotgun; and, (3) a black .22 caliber rifle, in furtherance of a drug trafficking crime. The superseding indictment also alleges that on April 24, 2018, Brandon Gray possessed a Mossberg .22 caliber rifle and on June 4, 2018, he possessed a Taurus 9 mm model PT111G2 handgun, after having been convicted of a previous felony offense (robbery). The superseding indictment further alleges that on June 4, 2018, Brandon Gray possessed a Taurus 9 mm model PT111G2 handgun in furtherance of a drug trafficking crime. Lastly, the superseding indictment alleges that from April 25, 2018 to June 6, 2018, Julian and Brandon Gray engaged in a course of conduct directing a person known to the Grand Jury to falsely report to law enforcement that said person possessed controlled substances found by law enforcement in the home of Julian Gray and Brandon Gray.
The defendants face a maximum total penalty of not less than five years and up to life imprisonment, a fine of $1,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Cindy K. Chung is prosecuting this case on behalf of the government.
The Drug Enforcement Administration (DEA) and the Bureau of Alcohol, Tobacco, Firearms, and Explosive (ATF), conducted the investigation leading to the Superseding Indictment in this case with valuable assistance from the Wilkins Township Police and Pittsburgh Bureau of Police. 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.
A superseding indictment is merely an accusation. A defendant is presumed innocent unless and until proven guilty.
Troy Man Pleads Guilty to Possessing Child PornographyRead the Press Release
ALBANY, NEW YORK – Robert P. Halloran, age 27, of Troy, New York, pled guilty today to one count of possession of child pornography, announced United States Attorney Grant C. Jaquith and Charles Margiotta, Acting Special Agent in Charge of the Albany Field Office of the Federal Bureau of Investigation (FBI).
As part of his guilty plea, Halloran admitted that from August 2016 through December 2016, he possessed approximately 60 video files containing child pornography that he stored in a Dropbox account. The video files depicted the sexual exploitation of children as young as 5 years old.
Halloran, who has a prior New York State misdemeanor conviction for Attempted Possession of an Obscene Sexual Performance by a Child, has been in custody since his arrest on April 13, 2017. He is scheduled to be sentenced on November 15, 2018, and faces at least 10 years and up to 20 years in prison, at least 5 years and up to lifetime post-imprisonment supervised release, and a maximum $250,000 fine. Halloran will also have to register as a sex offender when he is released from prison. 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 FBI, with assistance from the New York State Police, and is being prosecuted by Assistant U.S. Attorney Joseph A. Giovannetti.
This case is prosecuted as part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the United States Attorneys’ Offices, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
Three-Time Drug Felon Receives Significant SentenceRead the Press Release
LAREDO, Texas – A previously convicted drug trafficker has been ordered to federal prison for conspiring to possess with intent to distribute heroin, announced U.S. Attorney Ryan Patrick. Ramiro Hernandez Jr., 40, of Laredo, pleaded guilty Feb. 5, 2018.
Today, U.S. District Judge Diana Saldaña sentenced him to 235 months imprisonment. On supervised release when he committed the crime, the court revoked that term and further ordered he serve an additional 18 months to be served consecutively.
In handing down the sentence, the court noted Hernandez was a career offender, having two prior federal drug trafficking convictions, another for being felon in possession of a firearm, and that this is his new reality when he keeps living this kind of life. Judge Diana Saldaña also mentioned that heroin addiction is a nightmare, and Hernandez was spreading that nightmare to the rest of our community.
The investigation began Oct. 13, 2017, when law enforcement learned Hernandez was holding undocumented aliens in his apartment. One had escaped and reported Hernandez had assaulted him and he was held against his will.
Authorities went to the apartment and discovered 148 grams of heroin, 89 pounds of marijuana and a .40 caliber handgun. Upon searching Hernandez, they also discovered an additional 50 grams of heroin hidden in his rectum.
He has been and will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be determined in the near future.
The Bureau of Alcohol, Tobacco, Firearms and Explosives conducted the investigation with the assistance of the Laredo Police Department. Assistant U.S. Attorney Christopher dos Santos prosecuted the case.
Three Sentenced in Cocaine Distribution ConspiracyRead the Press Release
U.S. Attorney Duane A. Evans announced that MANUEL SERRATA, age 43, JOSE HINOJOSA, age 46, and JOSE CERVANTES-MARRON age 49, were sentenced today after being charged by an indictment with violating the Federal Controlled Substances Act.
According to court documents, SERRATA, HINOJOSA and CERVANTES-MARRON, along with two others, were arrested in November 29, 2016 with fifteen kilograms of cocaine hydrochloride while conducting a drug transaction in the parking lot of a Walmart in Houma, Louisiana.
SERRATA was sentenced to 135 months imprisonment and five years of supervised release. HINOJOSA was sentenced to 120 months imprisonment and five years of supervised release. CERVANTES-MARRON was sentenced to 24 months imprisonment and two years of supervised release.
U.S. Attorney Evans praised the work of the Drug Enforcement Agency, Louisiana State Police, Customs and Border Patrol, Jefferson Parish Sherriff’s Office, and the Terrebonne Parish Sherriff’s Office in investigating this matter. Assistant U.S. Attorneys David Haller and James S. C. Baehr are in charge of the prosecution.
Three Area Men Found Guilty of Felony Murder in 2015 Slaying in Northeast WashingtonRead the Press Release
WASHINGTON – Three men have been found guilty by a jury of felony murder and other charges stemming from the slaying of a man during a home invasion in Northeast Washington, announced U.S. Attorney Jessie K. Liu and Peter Newsham, Chief of the Metropolitan Police Department (MPD).
Joseph Barbour, 38, Willie Glover, Jr., 40, and Charles McRae, 66, were found guilty on July 17, 2018, of murder, first-degree burglary while armed and related offenses following a trial in the Superior Court of the District of Columbia. Barbour and McRae are from Washington, D.C., and Glover is from Forestville, Md. They remain held pending sentencing on Sept. 14, 2018, by the Honorable Craig Iscoe.
According to the government’s evidence, on the night of the killing, Dec. 21, 2015, the victim, Lenard Wills, was with a group of people in an apartment in the 700 block of 24th Street NE. His girlfriend was making dinner for the group when she got into a verbal argument with McRae. McRae left the apartment and came back a short time later with Barbour and Glover. One of the occupants let McRae into the apartment and, as he entered, Barbour and Glover came in behind him, wearing masks and carrying guns.
All three told the people in the apartment to get down and shut up. Barbour and Glover immediately went to Mr. Wills, who was seated at a table in the living room, and started pistol-whipping him, demanding money and drugs. McRae held down one of the occupants and punched another who tried to flee. He then pounded on the bathroom door demanding that Mr. Wills’ girlfriend come out, and punched her when she did. A struggle between Mr. Wills, Barbour and Glover ensued, during which one of the guns went off and broke apart. At some point during the struggle, Mr. Wills stabbed Barbour and Glover. McRae then came over to assist. Mr. Wills, 50, was stabbed multiple times and all three defendants fled the apartment. Mr. Wills was pronounced dead a short time later at a hospital.
Bleeding heavily, Barbour fled across the courtyard and a basketball court to his girlfriend’s apartment building. Later, while canvassing along the blood trail, officers with the Metropolitan Police Department recovered a knife in a trash can as well as Barbour’s cell phone on the basketball court. Glover, meanwhile, drove himself to an area hospital. McRae met up with several of the apartment’s occupants at a bus stop while police were canvassing the scene and told them, among other things, that what happened in the apartment was not meant for them and that if he had the gun, he would have shot Mr. Wills.
Barbour and Glover were arrested within days of the murder, and McRae was arrested in March 2016. All have been in custody ever since.
In announcing the verdict, U.S. Attorney Liu and Chief Newsham commended the work of those who investigated the case from the Metropolitan Police Department. They also expressed appreciation for the assistance provided by the District of Columbia Department of Forensic Sciences. They acknowledged the efforts of those who assisted with the case for the U.S. Attorney’s Office, including Assistant U.S. Attorneys Chrisellen Kolb and Daniel Lenerz; Forensic Operation/Program Specialist Benjamin Kagan-Guthrie; Intelligence Analyst Zachary McMenamin; Criminal Investigator John Marsh; Supervisory Paralegal Specialist Sharon Newman; Paralegal Specialists Meridith McGarrity, Alesha Matthews, Stephanie Gilbert, and Kelly Blakeney; Litigation Technology Specialists Anisha Bhatia, Leif Hickling, and Jeanie Latimore-Brown; Victim/Witness Advocate James Brennan, and Witness Security Specialist Debra Cannon. Finally, they commended the efforts of Assistant U.S. Attorney Veronica Sanchez, who investigated the case, and Assistant U.S. Attorneys Katherine Earnest and Richard Barker, who investigated and prosecuted the case.
Texas Woman Pleads Guilty to Heroin and Meth ConspiracyRead the Press Release
Jackson, Miss. – Trisha Lynne Ibarra, 24, of Texas, pled guilty yesterday before U.S. District Judge William H. Barbour to conspiracy to possess with intent to distribute 1 kilogram of heroin and 500 grams or more of a mixture or substance containing a detectable amount of methamphetamine, announced U.S. Attorney Mike Hurst and Special Agent in Charge Jere T. Miles of Immigration and Customs Enforcement’s Homeland Security Investigations New Orleans Field Office.
On January 22, 2018, a Rankin County Sheriff Deputy conducted a traffic stop of a vehicle. Ibarra was the registered owner of the vehicle and seated in the passenger seat. Ibarra and the driver gave conflicting statements to the officer for their reason for travel and their final destination. A consensual search of the vehicle resulted in the seizure of approximately 4 kilograms of heroin and 16 kilograms of methamphetamine from the vehicle’s fuel tank.
Ibarra will be sentenced by Judge Barbour on October 16, 2018, at 9:30 a.m. and faces a maximum penalty of life in prison and a $10 million fine.
The case was a joint investigation by the Rankin County Sherriff’s Office and U.S. Immigration and Customs Enforcement’s Homeland Security Investigations Jackson office. It is being prosecuted by Assistant United States Attorney Chris Wansley
Texas Man Charged in New Mexico with Conspiracy to Transport Illegal Aliens Within the United StatesRead the Press Release
ALBUQUERQUE – A U.S. Magistrate Judge sitting in Las Cruces, N.M., today found probable cause to support a criminal complaint charging Jose Alberto Garcia, 19, of El Paso, Texas, with conspiring to transport illegal aliens within the United States. During today’s proceedings, Garcia was ordered detained pending trial, which has yet to be scheduled
U.S. Border Patrol agents arrested Garcia on July 11, 2018, on the offense of conspiracy to transport illegal aliens within the United States. According to the criminal complaint, the U.S. Border Patrol allegedly found 12 illegal aliens in Garcia’s vehicle on July 11, 2018, while conducting an inspection at the U.S. Border Patrol Checkpoint on Interstate 25 north of Las Cruces. Garcia allegedly was being paid to transport the 12 illegal aliens to Albuquerque, N.M.
If convicted of the charge in the criminal complaint, Garcia faces a statutory maximum penalty of ten years of imprisonment. Charges in criminal complaints are merely accusations and criminal defendants are presumed innocent unless found guilty beyond a reasonable doubt.
This case was investigated by the U.S. Border Patrol and is being prosecuted by Assistant U.S. Attorney Luis A. Martinez of the U.S. Attorney’s Las Cruces Branch Office.
Tax Preparer Arrested for Fraudulent Scheme to Steal over $1 Million from His ClientsRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, James D. Robnett, the Special Agent-in-Charge of the New York Field Office of the Internal Revenue Service, Criminal Investigation (“IRS-CI”), and Nonie Manion, Acting Commissioner of the New York State Department of Taxation and Finance (“NYSDTF”), announced today the arrest of TOM SHIN on charges of aiding the preparation of a false tax return and wire fraud. The Complaint charges that SHIN, a tax preparer in New York, participated in a scheme to obtain over $1.3 million of his clients’ money that was intended to be paid to the IRS and NYSDTF for taxes the clients owed. SHIN was arrested this morning and will be presented today in Manhattan federal court before U.S. Magistrate Judge Debra Freeman.
U.S. Attorney Geoffrey S. Berman said: “As alleged, the defendant betrayed his clients’ trust and engaged in a brazen scheme to defraud his clients of more than $1.3 million that was intended to be used to pay taxes owed to the federal and state governments. Thanks to the investigative work of the IRS and the NYSDTF, the defendant will be prosecuted for his actions.”
IRS-CI Special Agent-in-Charge James D. Robnett said: “The IRS enforces the nation’s tax laws, but also takes particular interest in cases where someone, for their own personal gain, allegedly takes what belongs to others. Our special agents are uniquely qualified to assist state and federal law enforcement agencies with these types of investigations by following the money.”
NYSDTF Acting Commissioner Nonie Manion said: “The blatant deceit and theft allegedly carried out by this tax preparer is unconscionable. The honesty and integrity New Yorkers expect from their tax preparer must never be compromised, which is why we’ll continue to work with all levels of law enforcement to root out unscrupulous preparers and hold them accountable.”
According to the allegations in the Complaint unsealed today[1]:
SHIN was hired to prepare joint federal and state tax returns for two individuals (the “Clients”) for tax year 2017. SHIN showed the Clients completed tax return forms indicating that the Clients owed approximately $1.3 million in taxes. However, SHIN actually filed false returns on behalf of the Clients without their knowledge, which concealed the Clients’ tax liability. SHIN then, in connection with applications for extensions of time to file his personal tax returns, directed tax authorities to withdraw approximately $1.3 million from the Clients’ bank account, and then filed personal tax returns seeking an approximately $1.3 million refund. The net result of the alleged scheme would have been a transfer of approximately $1.3 million from the Clients’ bank account to SHIN.
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SHIN, 36, of Staten Island, New York, is charged with one count of aiding the preparation of a false tax return, which carries a maximum penalty of three years in prison, and one count of wire fraud, which carries a maximum penalty of 20 years in prison. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
This case is being handled by the Office’s General Crimes Unit. Assistant United States Attorney Brett M. Kalikow is in charge of the prosecution.
The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint forth herein constitute only allegations, and every fact described should be treated as an allegation.
Syrian national indicted on federal firearms chargesRead the Press Release
Defendant charged with unlawfully possessing firearms and making false statements
in connection with the attempted purchase of firearms from a local sporting goods store
PRESS RELEASE
Indianapolis-United States Attorney Josh Minkler announced today that a Syrian national faces federal charges for unlawfully purchasing and possessing firearms, as well as lying on federal forms while attempting to purchase another firearm. Majd Al Helwani, 24, Fishers, was indicted today and charged with four felony counts related to those activities.
“Aggressively prosecuting individuals who are not lawfully permitted to purchase or possess firearms is a cornerstone of a safe society,” said Minkler. “We are grateful to the collaborative partners who brought this to our attention and encourage all citizens to adhere to the campaign: If you see something, say something.”
This case stems from an investigation by the U.S. Department of Homeland Security, Homeland Security Investigations (HSI), assisted by the Federal Bureau of Investigation. In December of 2017, law enforcement officials received information from a concerned citizen that Al Helwani was in possession of at least one firearm, an AR-15 style, .223 caliber rifle. After HSI agents determined that Al Helwani had been admitted into the United States as a non-immigrant tourist, and was thereafter prohibited from possessing firearms, authorities obtained a search warrant for his residence. When agents arrived at his home to execute the warrant, Al Helwani came to the door armed with a loaded 9-millimeter handgun. A Sabal Arms, .223 caliber rifle was also recovered from the home.
During the course of the subsequent federal investigation, HSI agents learned that Al Helwani had attempted to purchase a shotgun from an Indianapolis area sporting goods store in October of 2016. As alleged in today’s indictment, Al Helwani misrepresented his immigration status during the course of that transaction by indicating he had not been admitted into the United States as a non-immigrant tourist.
“These charges send a message to those who lie in order to obtain firearms,” said Special Agent in Charge James M. Gibbons, Chicago HSI. “HSI is committed to working with our enforcement partners to combat those who threaten national security.”
According to Assistant United States Attorney Matthew J. Rinka who is prosecuting this case for the government, Al Helwani faces a maximum of ten years in prison if convicted.
An indictment is only a charge and not evidence of guilt. All defendants are presumed innocent until proved otherwise in federal court.
In October 2017, United States Attorney Josh J. Minkler announced a Strategic Plan designed to shape and strengthen the District’s response to its most significant public safety challenges. This prosecution demonstrates the Office’s firm commitment to prosecuting those who illegally possess firearms. United States Attorney’s Office, Southern District of Indiana Strategic Plan 1.8, 2.9.
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Spokane Man Sentenced to 126 Months in Federal Prison for Distributing Methamphetamine and Violating Court SupervisionRead the Press Release
Spokane – Joseph H. Harrington, United States Attorney for the Eastern District of Washington, announced that Jason Obermiller, age 34, of Spokane, Washington, was sentenced today after having pleaded guilty in April 2018, to distributing and conspiring to distribute 50 grams or more of a mixture and substance containing a detectable amount of methamphetamine, and admitting to violations of court supervision. Chief United States District Judge Thomas O. Rice sentenced Obermiller to a 90-month term of imprisonment, to be followed by an 8-year term of court supervision after he is released from Federal prison. Chief Judge Rice also imposed a 36-month term of imprisonment, to run consecutive to the sentence imposed in the drug case, after finding that Obermiller violated court supervision stemming from a previous conviction for bank fraud conspiracy. Chief Judge Rice also ordered Obermiller’s sentence to run consecutive to the 33-month state term of incarceration he is currently serving.
According to information disclosed during court proceedings, in September 2016, Obermiller distributed and conspired to distribute 50 grams or more of a mixture and substance containing a detectable amount of methamphetamine, and did so after he had absconded from court supervision stemming from a bank fraud conspiracy conviction.
U.S. Attorney Harrington said, “Prosecuting drug crimes continues to be a priority for the United States Attorney’s Office for the Eastern District of Washington. Drug traffickers should be aware that there are serious criminal penalties connected with possessing with the intent to distribute any drug and that this Office is committed to prosecuting aggressively drug cases in the Eastern District of Washington.”
This case was investigated by the Spokane Resident Office of the U.S. Drug Enforcement Administration, Spokane Police Department, and the Northwest High Intensity Drug Trafficking Area. This case was prosecuted by Caitlin Baunsgard, Allyson Edwards, and George J.C. Jacobs, III, Assistant United States Attorneys for the Eastern District of Washington.
Six Men Sentenced for Their Roles in an International Child Pornography Production RingRead the Press Release
Six men from around the country were sentenced today and yesterday for participating in an international child pornography production ring, announced Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, United States Attorney Matthew Schneider of the Eastern District of Michigan, and Special Agent in Charge Timothy R. Slater of the FBI, Detroit Division.
- Terry Kovac, 49, a dispatcher of a package delivery company of Las Vegas, Nevada, was sentenced to 37 years in prison, followed by 5 years of supervised release.
- Felipe Dominguez-Meija, 31, a painter of Springdale, Arkansas, was sentenced to 41 years in prison, followed by 5 years of supervised release.
- Noel Eisley, 38, a research scientist of Wappinger Falls, New York, was sentenced to 35 years in prison, followed by 10 years of supervised release.
- Eric Robinson, 42, a restaurant manager of Duluth, Minnesota, was sentenced to 34 years in prison, followed by 10 years of supervised release.
- Bret Massey, 47, a sales coordinator and design specialist of Portland, Maine, was sentenced to 32 years in prison, followed by 10 years of supervised release.
William Phillips, 39, a cook of Highland Park, New York, pleaded guilty to the charge of child exploitation enterprise in two cases for his participation in the above-described group as well as another, similar group with the same objective. Phillips entered guilty pleas on Dec. 21, 2017 and May 11, 2018. On the first case, Phillips was sentenced to 33 years in prison, followed by 5 years of supervised release. On the second case, Phillips was sentenced to 33 years in prison, to run concurrently, followed by 5 years of supervised release.
In addition to their prison sentences and terms of supervised release, all of the defendants were ordered to pay 5,000 dollars in restitution to each of the identified victims, reaching a total of over 1.4 million dollars. U.S. District Judge Stephen J. Murphy III for the Eastern District of Michigan imposed the sentences.
According to court records, these six men worked together from 2013 to April of 2017, with other men both inside and outside of the United States, to lure juvenile girls to two different unmonitored video chat websites and sexually exploit them. The men recruited the victims from common social media platforms by pretending to be teenage boys interested in chatting with the girls in real time. Once the victims arrived in the chatrooms, the group—all pretending to be teenagers—worked together to build trust and convince the child to engage in sexually explicit conduct on web camera. The group members then recorded that activity and shared it with each other. The girls were unaware that the men were making recordings, or what they dubbed “captures,” of the sexual activity.
Through their scheme, the group successfully recorded tens of thousands of sexually explicit videos of minors, some as young as 11 years old. The defendants preyed on more than 100 victims, some of whom were present for the sentencing hearing and made statements to the Court. Still other victims have not been identified. The FBI has so-far identified 48 victims in the United States.
“The six men sentenced today are an example of a disturbing and reprehensible new trend: the ‘crowdsourcing’ of child exploitation,” said Assistant Attorney General Benczkowski. “These highly organized and coldly calculating defendants worked together over the course of several years, pretending to be teenage boys in order to entice more than 100 minor girls—some as young as 11 years old—into producing child pornography which the defendants then shared with each other. Thanks to the outstanding efforts of the agents and prosecutors who worked on this case, these men will spend years behind bars, and their victims—some of whom were present at the sentencing and addressed the Court—have received some measure of justice for the terrible harm done to them.”
“These predators committed truly horrific crimes against innocent girls, and they deserve decades in prison. Shockingly, some of these defendants have young children themselves,” said United States Attorney Schneider. “Parents, please speak with your children about the dangers of chatting online so we can keep all of our children safe.”
“These appalling crimes victimize and exploit innocent children”, said FBI Special Agent in Charge Slater. “The arrest and prosecution of perpetrators who commit these heinous acts of violence will continue to be a high priority of the FBI’s SEMTEC task force.”
Assistant United States Attorneys April N. Russo and Kevin M. Mulcahy of the Eastern District of Michigan, along with Trial Attorney Leslie Fisher of the Child Exploitation and Obscenity Section (CEOS) of the Justice Department’s Criminal Division, prosecuted the case. The FBI’s Detroit Field Office and Southeast Michigan Trafficking and Exploitation Crimes task force investigated the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse, launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and 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 http://www.justice.gov/psc.
Second Member of Valley Street Drug Trafficking Network Pleads GuiltyRead the Press Release
United States Attorney Brandon J. Fremin announced today the convictions of two individuals charged in connection with an investigation by the Middle District of Louisiana, Organized Crime and Drug Enforcement Task Force (“OCDETF”), aimed at a drug trafficking and dogfighting network based in Baton Rouge and operating in Louisiana, Arkansas, Georgia, and Mississippi. The Superseding Indictment and Bill of Information filed in this matter charged drug trafficking offenses involving cocaine, marijuana and heroin as well violations of the Federal Animal Welfare Act.
On July 17, 2018, Marco Murphy, a.k.a. “Big Daddy”, age 34, of Baton Rouge, Louisiana, appeared before Judge Shelly Dick and pled guilty to his role in the drug trafficking network. Murphy pled guilty to one count of conspiracy to distribute, and possess with intent to distribute, 28 grams of cocaine and 28 grams of marijuana, and one count of possession with the intent to distribute cocaine and marijuana.
On July 2, 2018, Eric Lashawn Williams, a.k.a. “E” and “EZ”, age 35, of Baton Rouge, Louisiana, pled guilty to one count of conspiracy to distribute, and possess with intent to distribute, 46 grams of heroin, 285 grams of cocaine and 28 grams of marijuana, one count of the unlawful use of a communication facility and one count of possession of a firearm by a convicted felon. WILLIAMS also pled guilty to a Bill of Information charging him with violating the Federal Animal Welfare Act by possession of animals in animal fighting ventures.
Because of their guilty pleas, each defendant faces a significant term of imprisonment, fines and the forfeiture of proceeds from their illegal activity.
According to documents filed in connection with the guilty pleas, WILLIAMS was the organizer and leader of a drug trafficking organization (“DTO”) which was responsible for the distribution of cocaine, marijuana and heroin in the Valley Park neighborhood of Baton Rouge. MURPHY was a member of the DTO who distributed narcotics for the organization.
During the investigation into WILLIAMS’ drug trafficking organization, law enforcement agents became aware that WILLIAMS was also involved in an illegal dogfighting operation. The FBI Baton Rouge Capitol Area Gang Task Force intercepted WILLIAMS’s telephone conversations discussing the results of dogfights in Louisiana, Arkansas and Georgia, arranging future dogfights, wagers on upcoming dogfights, as well as the breeding, sale, and training of dogs for fighting.
On August 24, 2017, law enforcement agents conducted a search at two residences in Baton Rouge and seized 13 pit bull dogs. The dogs belonged to WILLIAMS, and were related to his multi-state dog-fighting activities.
U.S. Attorney Fremin stated, “Ridding the Valley Park neighborhood of these defendants who sold illegal drugs and used the proceeds to train and illegally fight animals for profit and their entertainment is an important step in my office’s goal of aggressive enforcement of federal laws, be it illegal drugs, guns or dogfighting.”
This investigation is another effort by the OCDETF Program, which was established in 1982 to mount a comprehensive attack against organized drug traffickers. Today, the OCDETF Program is the centerpiece of the United States Attorney General’s drug strategy to reduce the availability of drugs by disrupting and dismantling major drug trafficking organizations, money laundering organizations, and related criminal enterprises. The OCDETF Program operates nationwide and combines the resources and unique expertise of numerous federal, state, and local agencies in a coordinated attack against major drug trafficking and money laundering organizations.
This OCDETF operation is being handled by the U.S. Attorney’s Office for the Middle District of Louisiana and the FBI Baton Rouge Capitol Area Gang Task Force. This matter is being prosecuted by Assistant United States Attorney Lyman E. Thornton III.
Santa Fe Man Pleads Guilty to Federal Kidnapping Charge Arising from Kidnapping and Carjacking at Ohkay Owingeh PuebloRead the Press Release
ALBUQUERQUE – Luis Molina, 33, of Santa Fe, N.M., pled guilty today in federal court in Albuquerque, N.M., to a kidnapping charge. In entering the guilty plea, Molina acknowledged kidnapping and carjacking two women at the Ohkay Owingeh Casino and Resort in Ohkay Owingeh Pueblo, N.M., in Dec. 2015, and robbing them.
Molina was indicted in Dec. 2016, and was charged with two counts of kidnapping and one count of carjacking. The indictment alleged that Molina committed the crimes on Dec. 31, 2015, in Rio Arriba County, N.M.
The FBI arrested Molina on April 26, 2017, after he was transferred into federal custody from state custody where he was being held on unrelated state charges.
During today’s proceedings, Molina pled guilty to one of the kidnapping charges. In entering the guilty plea, Molina admitted that on Dec. 31, 2015, he was outside the Ohkay Owingeh Casino and Hotel and followed the two victims to their vehicle. In his plea agreement, Molina admitted that he got into the backseat of the victims’ vehicle, told the victims that he had a gun, directed them to drive away, and threatened to hurt them if they did not follow his instructions. Molina also admitted forcing the victims to drive to an ATM machine where they withdrew money, which they gave to Molina. Molina then directed the victims to drive him to Espanola, N.M., where he stole their credit cards, drivers’ licenses and social security cards.
At sentencing, Molina faces a statutory maximum penalty of life in federal prison. Molina has been in federal custody since his arrest in April 2017 and he will remain detained pending a sentencing hearing, which has yet to be scheduled.
This case was investigated by the Santa Fe office of the FBI with assistance from the New Mexico State Police, the Santa Fe Sheriff’s Office, the Ohkay Owingeh Police Department and Espanola Police Department. Assistant U.S. Attorney Nicholas J. Marshall is prosecuting the case.
Salvadoran National Sentenced for Illegal ReentryRead the Press Release
U.S. Attorney Duane A. Evans announced that FRANCISCO MEDARDO-SANTOS, age 32, a native of El Salvador, was sentenced today to time served by U.S. District Court Judge Susie Morgan for illegal use of a Social Security number, in violation of Title 42, United States Code, Section 408(a)(7)(B).
In October 2015, MEDARDO-SANTOS applied for employment with a business in Jefferson Parish. MEDARDO-SANTOS was a citizen of El Salvador and was not a citizen or a lawful permanent resident of the United States. MEDARDO-SANTOS completed an Employment Eligibility Verification Form I-9 with the business. Knowingly, willfully, with intent to deceive, and with the intent to obtain employment, MEDARDO-SANTOS falsely represented on the Form I-9 that he was another individual, that he was a lawful permanent resident, and that the other individual’s Social Security Number was assigned to MEDARDO-SANTOS by the Commissioner of Social Security. MEDARDO-SANTOS also presented the business with the other individual’s Social Security card and a false permanent resident card that bore the other individual’s name and MEDARDO-SANTOS’s photograph.
U.S. Attorney Evans praised the work of the United States Immigration and Customs Enforcement – Enforcement and Removal Operations in investigating this matter. Assistant United States Attorney Chandra Menon was in charge of the prosecution.
Removed Alien from Honduras Charged with Illegally Re-entering United StatesRead the Press Release
PITTSBURGH, PA – An illegal alien found in Pittsburgh, Pennsylvania has been indicted by a federal grand jury in Pittsburgh on a charge of illegally re-entering the United States after having been deported, United States Attorney Scott W. Brady announced today.
The one-count indictment named Rolando Tabora Fuentes, 40, of Honduras, as the sole defendant.
According to the Indictment, Tabora Fuentes was formally removed from the United States by United States Immigration and Customs Enforcement on June 9, 1998, September 8, 2009, and September 20, 2013. Tabora Fuentes was found to be illegally present in Pittsburgh, Pennsylvania, on June 29, 2018.
The law provides for a maximum total sentence of up to two years in prison, a fine of $250,000 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Rebecca L. Silinski is prosecuting the case on behalf of the government.
The U.S. Immigration and Customs Enforcement/Homeland Security Invesitgations conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Registered Sex Offender Sentenced to 40 Years in Prison for Federal Offenses Stemming from Attack of 15-Year-OldRead the Press Release
WASHINGTON – Charles Morgan, 57, a registered sex offender who is formerly of Washington, D.C., was sentenced today to 40 years in prison on child exploitation charges and other offenses stemming from his sexual assault of a 15-year-old girl he picked up at a bus stop.
The announcement was made by U.S. Attorney Jessie K. Liu, Michael Hughes, U.S. Marshal for the Superior Court of the District of Columbia, Nancy McNamara, Assistant Director in Charge of the FBI’s Washington Field Office, and Peter Newsham, Chief of the Metropolitan Police Department (MPD).
Morgan was found guilty by a jury on May 2, 2018, following a trial in the U.S. District Court for the District of Columbia. He was found guilty that day of two federal charges, including one count of transportation of a minor with intent to engage in criminal sexual activity, and one count of attempted production of child pornography. On May 5, 2018, the Court found him guilty of two additional federal counts of commission of a crime of violence against a minor while being required to register as a sex offender.
Morgan was sentenced by the Honorable Senior Judge Ellen S. Huvelle. Following completion of his prison term, he is to be placed on supervised release for the rest of his life. He also must register as a sex offender for the rest of his life.
According to the government’s evidence, the defendant, a convicted rapist, sexually assaulted a 15-year-old girl on May 23, 2016. The victim had left home after dark without telling her family and was trying to catch a bus to a friend’s house. Morgan, who was in a car, pulled over near the bus stop at Minnesota Avenue and Randall Circle SE and offered the victim a ride. Given that it was nearly midnight, there was no bus in sight, and the victim’s cellular phone was dead, she reluctantly accepted because Morgan showed her a business card and an identification badge to reassure her of his identity. Instead of taking the victim to her friend’s home, Morgan drove the victim to his basement apartment in Capitol Heights, Maryland, and anally sodomized her. Morgan told the victim to wash off in the bathroom, gave her a pair of his underwear to put on, then drove her back into the District of Columbia and dropped her off along the street near where he had picked her up. Morgan told the victim that he was going to pick her up again the following weekend so that he and his roommate could engage in sexual acts with her.
The victim immediately reported the rape. An undercover officer assumed the victim’s identity and engaged in a text conversation with Morgan in which the defendant insisted that he was going to pick up the victim the following weekend to assault her again. Morgan also demanded that the victim take naked photos of genitals and send them to him. He was arrested shortly thereafter and charged in the District of Columbia on the charges for which he stands convicted. Morgan has also been charged in Maryland with rape charges stemming from the sexual assault of the victim that occurred in his residence there.
Morgan was already registering as a sex offender as a result of an armed rape of a woman that he committed in 1989. He was released from prison in that case in 2009.
In announcing the sentence, U.S. Attorney Liu, Marshal Hughes, Assistant Director in Charge McNamara, and Chief Newsham commended the work of Senior Inspector Floriano Whitwell and other members of the D.C. Superior Court Sex Offender Investigations Section of the U.S. Marshals Service, who investigated the case, as well as those who worked on the case from the FBI’s Washington Field Office and the Metropolitan Police Department.
They acknowledged those who assisted with the case at the U.S. Attorney’s Office, including Assistant U.S. Attorney Lindsay Suttenberg, of the Sex Offense and Domestic Violence Section; Elizabeth Trosman, Chief of the Appellate Division; Assistant U.S. Attorneys Lauren Bates and Nicholas Coleman, of the Appellate Division, and Michael Ambrosino, Special Counsel for DNA and Forensic Evidence Litigation. They also acknowledged the assistance provided by Criminal Investigator John Marsh; Victim/Witness Advocate Yvonne Bryant; Witness Security Specialist Debra Cannon; Forensic Operation/Program Specialist Benjamin Kagan-Guthrie; Paralegal Supervisor Michelle Wicker; Paralegal Specialist Tiffany Jones; former Paralegal Specialist Donhue Troy Griffith; Litigation Technology Specialist Anisha Bhatia, and former Litigation Technology Specialist Joshua Ellen.
Finally, they commended the work of Assistant U.S. Attorneys Andrea L. Hertzfeld and Jason Park, who investigated and prosecuted the case.
This case was part of the Department of Justice's Project Safe Childhood initiative and was, along with the U.S. Marshals Service Sex Offender Investigations Section, investigated by the FBI's Child Exploitation Task Force, which includes members of the FBI's Washington Field Office and MPD. In February 2006, the Attorney General created Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the U.S. Attorney's Offices, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov
Put-in-Bay police officer indicted for using excessive force and obstructing justiceRead the Press Release
A federal grand jury today unsealed an indictment charging El’Shawn Williams, an officer in the Put-in-Bay Police Department, with using excessive force against a man in custody, and then making false statements and writing false reports to cover it up. The indictment alleges that Williams, 28, punched and struck the victim multiple times in the head and body, causing him bodily injury.
The indictment was announced by Acting Assistant Attorney General for the Civil Rights Division John Gore, United States Attorney Justin Herdman of the Northern District of Ohio, and Special Agent in Charge Stephen D. Anthony of the FBI’s Cleveland Division.
The indictment alleges that after the incident, Williams wrote a report that falsely minimized the force he used and failed to disclose that he struck the victim after the victim was restrained by another officer. It also alleges that Williams gave a false statement to an Ottawa County detective denying that he punched the victim, denying that he struck him in the face, and denying that he struck him after the victim was restrained by another officer.
If convicted, Williams faces a maximum punishment of 10 years imprisonment for the excessive force charge and up to 20 years imprisonment for each obstruction charge. An indictment is merely an accusation, and the defendant is presumed innocent unless proven guilty.
This case was investigated jointly by the ClevelandDivision of the Federal Bureau Investigation and the Ottawa County Sheriff’s Department. It is being prosecuted by Assistant United States Attorney Michael Freeman of the Northern District of Ohio and Trial Attorney Dana Mulhauser of the Civil Rights Division of the Department of Justice.Plantation Resident Convicted of Making False Statement to Federally Licensed Firearms DealerRead the Press Release
Yvens-Son Dudley Jeudy, 26, of Plantation, was convicted today by a federal jury of knowingly making a false statement to a licensed firearms dealer.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida, and Ari C. Shapira, Special Agent in Charge, United States Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Miami Field Office, made the announcement.
According to the court record, including evidence presented at trial, on September 17, 2017, Jeudy purchased two pistols from a federally licensed firearms dealer at the Fort Lauderdale Gun Show at the War Memorial Auditorium. On a document that he was required to complete at the time of the purchase (ATF Form 4473), Jeudy falsely claimed that he had not been charged with a felony criminal offense. This ATF form is required to be kept in the records of licensed firearms dealers. Contrary to his false claim, Jeudy was in fact pending trial in a Broward County, Florida case on three felony charges.
Jeudy is scheduled to be sentenced by U.S. District Court Judge James I. Cohn on September 26, 2018.
This case stems from Project Safe Neighborhoods (PSN), a program that brings together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. 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.
Mr. Greenberg commended the investigative efforts of the ATF. This case is being prosecuted by Assistant United States Attorney William T. Shockley.
Related court documents and information can be found on the District Court for the Southern District of Florida’s website at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Pittsburgh Man Pleads Guilty to Distribution of Dangerous OpioidRead the Press Release
PITTSBURGH, PA – A resident of Pittsburgh, Pennsylvania, pleaded guilty in federal court to charges of conspiracy to distribute and possession with intent to distribute an analogue of fentanyl, United States Attorney Scott W. Brady announced today.
Calvin Armstrong, 31, pleaded guilty to two counts before Senior United States District Court Judge David S. Cercone.
In connection with the guilty plea, the court was advised that from May 2017 to August 2017, Calvin Armstrong conspired with others to distribute and possess with intent to distribute cyclopropyl fentanyl, an analogue of fentanyl. Armstrong’s co-conspirator, Lynell Guyton purchased large quantities of fentanyl analogues from overseas purveyors, which he distributed in Western Pennsylvania.
From late August 8, 2017 through the early morning of August 9, 2017, Armstrong packaged large amounts of cyclopropyl fentanyl with other individuals. On August 9, 2017, law enforcement executed a search warrant. Guyton was found on the first floor along with Armstrong and two other individuals. Large amounts of narcotics and packaging paraphernalia were present in the house. A table with powder narcotics was overturned during the initial SWAT entry into the home, causing large amounts of opioids to become airborne. SWAT officers exposed to the airborne narcotics were sent to the hospital for evaluation–everyone was medically cleared and no one was harmed. Law enforcement also executed another search warrant and found another individual and opioids at that residence. A total of 235 grams of cyclopropyl fentanyl was recovered from both residences. Armstrong admitted to packaging narcotics.
Judge Cercone scheduled sentencing for December 7, 2018. The law provides for a maximum total sentence of not less than 10 years and up to life in prison, a fine of $10,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant. Pending sentencing, the court ordered Armstrong to remain detained.
Assistant United States Attorneys Rachael L. Dizard and Shanicka L. Kennedy are prosecuting this case on behalf of the government.
The U.S. Immigration and Customs Enforcement’s (ICE)/Homeland Security Investigations (HSI), assisted by the United States Postal Inspection Service, the Pennsylvania State Police and the Pittsburgh Bureau of Police, including the Pittsburgh Police SWAT Team, conducted the investigation leading to the Indictment in this case.
Pinellas Park Babysitter Sentenced for Producing Child Pornography of InfantRead the Press Release
Tampa, Florida – U.S. District Judge Charlene E. Honeywell today sentenced Robert Joseph Ware (27, Pinellas Park) to 23 years in federal prison for producing child pornography. Ware had pleaded guilty on December 20, 2017.
According to court documents, on December 10, 2011, Ware produced three images of child pornography depicting him sexually abusing an infant that he had been babysitting. He sent the images via text message to an individual in New York. The investigation and prosecution of the individual in New York revealed the child pornography produced by Ware. When federal agents arrested Ware on May 9, 2017, he had 90 images of child pornography on his cellphone.
This case was investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations. It was prosecuted by Assistant United States Attorney Jennifer L. Peresie.
“Only the worst depraved criminal would produce child pornography with an infant left in his care,” said HSI Tampa Special Agent in Charge James C. Spero. “This egregious crime reminds us all to remain vigilant in the protection of our children.”
It is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Pine Ridge Man Found Guilty in Death of ChildRead the Press Release
United States Attorney Ron Parsons announced that Zachariah Michael Poor Bear, 24, of Pine Ridge, South Dakota, was convicted of First Degree Murder and Assault Resulting in Serious Bodily Injury following a four-day federal jury trial held in U.S. District Court in Rapid City. The guilty verdict was returned on July 13, 2018.
The penalty is mandatory lifetime imprisonment, a $250,000 fine, and a $100 special assessment to the Federal Crime Victims Fund.
The conviction stemmed from Poor Bear killing a 19 month-old baby by inflicting blunt force trauma to her head and abdomen, in May 2015 at Pine Ridge.
The investigation was conducted by the Federal Bureau of Investigation, the Bureau of Indian Affairs Office of Justice Services, and the Oglala Sioux Tribe Department of Public Safety. Assistant U.S. Attorneys Sarah Collins and Eric Kelderman prosecuted the case.
A presentence investigation was ordered and a sentencing date will be set. The defendant was remanded to the custody of the U.S. Marshals Service.
Penn Hills Felon Charged with Illegally Possessing Pistols and AmmunitionRead the Press Release
PITTSBURGH, PA – An Allegheny County man has been indicted by a federal grand jury in Pittsburgh on a charge of being a felon in possession of firearms and ammunition, United States Attorney Scott W. Brady announced today.
The one-count indictment named Jaamiyl Dean, age 42, of Penn Hills, Pa.
According to the indictment, on or about June 20, 2018, Dean possessed an Intratec 9mm Luger pistol, a Smith & Wesson 9mm pistol, and multiple rounds of ammunition. Dean was prohibited from possessing the firearms and ammunition because of his prior convictions for aggravated assault, robbery, and a felony drug offense.
The law provides for a maximum total sentence of not less than 15 years and up to life in prison, a fine not to exceed $250,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offense and the prior criminal history of the defendant.
Assistant United States Attorneys Tonya Sulia Goodman, Rachael L. Dizard, and Rebecca L. Silinski are prosecuting this case on behalf of the government.
The Federal Bureau of Investigation and the Drug Enforcement Administration jointly led the multi-agency investigation of this case, which also included the Pittsburgh Bureau of Police, Allegheny County Sheriff’s Office, Pennsylvania State Police, Robinson Township Police Department, Stowe Township Police Department, Pennsylvania Attorney General’s Office, Wilkinsburg Borough Police Department, and the McKees Rocks Police Department. The investigation was funded by the federal Organized Crime Drug Enforcement Task Force Program (OCDETF). The OCDETF program supplies critical federal funding and coordination that allows federal and state agencies to work together to successfully identify, investigate, and prosecute major interstate and international drug trafficking organizations and other criminal enterprises.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Owner of Canton company that manufactures American flags indicted for failing to pay $162,000 in payroll taxesRead the Press Release
The owner of a Canton company that manufactures American flags was indicted for failing to pay more than $162,000 in payroll taxes.
Richard Spencer, 51, was indicted in federal court on 15 counts of failure to account for, collect and pay over employment taxes.
U.S. Attorney Justin Herdman said: “This defendant is accused of not paying over taxes he collected from his employees, and intentionally misclassifying others to avoid taxes. This defendant benefitted from being able to say that his flags were made in America, but he failed to meet his obligations to his employees and the American taxpayer.”
“In an attempt to avoid his employment tax responsibilities as owner of RS Sewing, Richard Spencer misclassified a portion of his employees as independent contractors. He also withheld employment taxes from his appropriately classified employees, but never paid them to the IRS,” said Ryan L. Korner, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office.
Spencer controlls RS Sewing, which manufactures American flags. Spencer oversaw production, source materials, paperwork and the company’s financial operations, according to the indictment.
Spencer, beginning around 2008, reclassified some of his workers from employees to independent contractors. Following an audit in 2011, Spencer was informed he improperly classified the workers as independent contractors, and a penalty was assessed against Spencer. He continued to misclassify some employees and failed to pay employment taxes, according to the indictment.
Spencer classified some workers as independent contractors and others as employees, although all RS Sewing workers were required to clock in and out, were paid wages by the hour, were provided materials to make the flags by RS Sewing and were otherwise treated the same by managers, according to the indictment.
Spencer from 2012 through 2015, Spencer failed to withhold taxes from workers he knowingly and willfully misclassified as independent contractors. For workers classified as W-2 employees, Spencer withheld federal income, Social Security and Medicare taxes from employees but never paid the money to the IRS, according to the indictment.
Overall, he failed to collect, account for and pay over approximately $162,728 of federal employment taxes, according to the indictment.
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and, in most cases, it will be less than the maximum.
This case was investigated by the Internal Revenue Service – Criminal Investigations. It is being prosecuted by Assistant U.S. Attorney Carmen Henderson.
An indictment is only a charge and is not evidence of guilt. The defendant is entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Orlando Man Sentenced to More Than 19 Years for Enticement of A Minor and Federal Income Tax FraudRead the Press Release
Orlando, Florida – U.S. District Judge Paul G. Byron has sentenced Andy William Bosch (43, Orlando) to 16 years and 8 months in federal prison for enticement of a minor to engage in sexual activity and for federal income tax fraud. Bosch pleaded guilty to both charges on March 29, 2018.
According to court documents, between March 10 and March 16, 2016, Bosch enticed a minor to travel from the Philippines to the United States to engage in sexual activity. Then, from October 20, 2016, to February 15, 2017, he used a cell phone to coerce the same minor to engage in sexual activity.
Furthermore, both independently and as part of his federal tax preparation business (BBG Tax Services), Bosch helped to prepare and file fraudulent federal income tax returns from 2012 to 2017. The losses for the false tax returns charged in the indictment totaled $135,801.
The enticement case was investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI), the U.S. Border Patrol, U.S. Citizenship and Immigration Services, with assistance from the U.S. Marshals Service, and the Osceola County Sheriff’s Office. The tax fraud case was investigated by the Internal Revenue Service – Criminal Investigation.
“HSI’s extensive international reach helped stop this criminal in his tracks,” said HSI Special Agent in Charge James C. Spero. “This sentencing underscores the combined efforts of federal, state, and local law enforcement in working to stop predators from harming children.”
Both cases were prosecuted by Special Assistant United States Attorneys Christina R. Downes and Brandon Bayliss, on assignment from the Office of Principal Legal Advisor, ICE, in the Middle District of Florida.
Oregon Prosecutor Receives DEA Administrator's AwardRead the Press Release
WASHINGTON – Scott M. Kerin, Assistant U.S. Attorney for the District of Oregon, was one of several prosecutors and investigators recognized today by Acting Drug Enforcement Administration (DEA) Administrator Uttam Dhillon for their work investigating a transnational opiate trafficking organization.
Kerin and his colleagues were given the prestigious Administrator’s Award for Outstanding Group Achievement in a ceremony today in Washington.
This case came to the attention of law enforcement as part of “Operational Denial,” an Organized Crime and Drug Enforcement Task Force (OCDETF) investigation into the international trafficking of fentanyl and other legal drugs, and was significantly aided by the national and international coordination of agencies led by DEA’s Special Operations Division (SOD). The operation started in North Dakota in January 2015 as an overdose investigation. To date, 32 defendants have been charged as a result of the investigation.
This case jointly investigated by DEA; U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI); U.S. Postal Inspection Service; IRS Criminal Investigations; Grand Forks Narcotics Task Force; Royal Canadian Mounted Police (RCMP); Portland Police Bureau (PPB), Drugs and Vice Division; Portland HIDTA Interdiction Task Force; Oregon State Police (OSP); and the Grand Forks, North Dakota Police Department.
Christopher C. Myers, U.S. Attorney for the District of North Dakota; Assistant U.S. Attorney Kerin; and Trial Attorney Adrienne Rose of the Criminal Division’s Narcotics and Dangerous Drugs Section are prosecuting the case.
This case was brought as part of the Justice Department’s Organized Crime and Drug Enforcement Task Force (OCDETF) program, the centerpiece of the department’s strategy for reducing the availability of drugs in the U.S. OCDETF was established in 1982 to mount a comprehensive attack on drug trafficking by disrupting and dismantling major drug trafficking and money laundering organizations. Today, OCDETF combines the resources and expertise of its member federal agencies in coordination with state and local law enforcement.
Orange County Real Estate Investor Sentenced to More Than Six Years in Federal PrisonRead the Press Release
SANTA ANA, California – A former Orange County real estate investor was sentenced yesterday by United States District Judge David O. Carter to 78 months in prison for defrauding 70 investors out of more than $12 million.
Francisco Plascencia Esparza, 46, formerly of Coto De Caza now residing in Cumming, Georgia, solicited millions of dollars from investors in Southern California, promising to use the money to acquire real estate and pay a fixed rate of return on their investments.
Esparza pleaded guilty in September to wire fraud, admitting that he had lured investors over a seven-year period by falsely claiming that he had run successful businesses and investment ventures when, in fact, his prior business ventures failed. Esparza engaged in a Ponzi scheme, using funds from new victims to pay off prior investors. Esparza also admitted using investor money for personal purposes, including purchasing a home, luxury cars, a wedding, and vacations.
Judge Carter found that dozens of victims suffered substantial financial harm from the fraud, including for some, the loss of their 401k retirement accounts and the inability to retire as planned, if at all.
Judge Carter ordered Esparza to pay $12.6 million in restitution.
The investigation was conducted by the Federal Bureau of Investigation.
This case was prosecuted by Assistant United States Attorneys Daniel S. Lim and Joseph T. McNally of the Santa Ana Branch Office.
Orange County Man Sentenced to 108 Months in Federal Prison in $21 Million ‘Builder Bailout’ Fraud SchemeRead the Press Release
SANTA ANA, California – An Orange County man was sentenced to federal prison for his leadership role in a “builder bailout” mortgage fraud scheme.
Momoud Aref Abaji, 37, of Huntington Beach, was sentenced to 108 months in prison by United States District Judge Andrew Guilford and ordered to pay more than $10 million in restitution to the financial institutions that were victims of the fraud. The scheme Abaji operated resulted in the fraudulent purchase of more than 100 condominium units around the country, causing more than $10 million in losses when the properties went into foreclosure.
Abaji, along with several co-conspirators, operated the scheme through Excel Investments and related companies based in Santa Ana and Irvine. The scheme involved kickbacks from condominium builders during the 2008 financial crisis, that Abaji and his co-conspirators hid from lenders to convince them to fund loans in excess of the actual purchase price.
During the course of the scheme, co-conspirators identified condominium developments around the country where the builders were struggling to sell units and arranged to purchase multiple units at a discount. The builders benefitted by making it appear that their condos were selling and maintaining their value, while members of the conspiracy obtained the kickbacks.
The co-conspirators negotiated with condominium builders in California, Florida and Arizona for discount units. The defendants bought units for themselves, their relatives, and on behalf of “straw buyers” whom they brought into the scheme. They identified straw buyers by looking for individuals with good credit scores and then recruited them into the scheme by giving them an upfront payment for their participation and by presenting the scheme as an investment opportunity that required no down payment and would generate income through rental payments.
To obtain mortgages for the properties, Abaji and other co-conspirators prepared loan applications with false information about the straw buyers – including fake employment, income and assets, as well as fabricated W2s, pay stubs and bank statements. The mortgage applications also included false information about the terms of the transactions, such as concealing the large kickbacks from builders through false and misleading HUD-1 forms. As a result of the false statements in the fraudulent loan applications, mortgage lenders provided over $21 million in financing to purchase more than 100 properties.
Many of these loans went into default, and mortgage lenders lost more than $10 million after foreclosing on the properties. The Federal Home Loan Mortgage Corporation (Freddie Mac) and the Federal National Mortgage Association (Fannie Mae) purchased dozens of these loans on the secondary mortgage market and suffered losses of at least $1.3 million as a result of defaults and foreclosures on the properties.
Several other defendants were charged in connection with the same scheme.
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Abaji’s brother, Maher Obagi, 32, of Huntington Beach, who was sentenced in June 2018 to 78 months in prison and ordered to pay just over $10 million in restitution.
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Mohamed Salah, 43, of Mission Viejo, who was sentenced in June 2018 to 57 months in prison and ordered to pay just over $7 million in restitution.
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Ali Khatib, 53, of Newport Coast, pleaded guilty in a related case and is scheduled to be sentenced on September 10th;
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Jacqueline Burchell, 57, of Orange, pleaded guilty in June 2013 and is scheduled to be sentenced on October 1st;
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Wajieh Tbakhi, 53, who is currently a fugitive; and
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Mohamed El Tahir, now deceased.
This matter was investigated by the Federal Bureau of Investigation; the Federal Housing Finance Agency, Office of the Inspector General; and IRS Criminal Investigation.
The case is being prosecuted by Assistant United States Attorney Kerry L. Quinn of the Major Frauds Section.
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Ohio Police Officer Indicted for Assaulting an Arrestee and Obstructing JusticeRead the Press Release
A federal grand jury today unsealed an indictment charging El’Shawn Williams, an officer in the Put-in-Bay Police Department, with using excessive force against a man in custody, and then making false statements and writing false reports to cover it up. The indictment alleges that Williams, 28, punched and struck the victim multiple times in the head and body, causing him bodily injury.
The indictment was announced by Acting Assistant Attorney General for the Civil Rights Division John Gore, United States Attorney Justin Herdman of the Northern District of Ohio, and Special Agent in Charge Stephen D. Anthony of the FBI’s Cleveland Division.
The indictment alleges that after the incident, Williams wrote a report that falsely minimized the force he used and failed to disclose that he struck the victim after the victim was restrained by another officer. It also alleges that Williams gave a false statement to an Ottawa County detective denying that he punched the victim, denying that he struck him in the face, and denying that he struck him after the victim was restrained by another officer.
If convicted, Williams faces a maximum punishment of 10 years imprisonment for the excessive force charge and up to 20 years imprisonment for each obstruction charge. An indictment is merely an accusation, and the defendant is presumed innocent unless proven guilty.
This case was investigated jointly by the Cleveland Division of the Federal Bureau Investigation and the Ottawa County Sheriff’s Department. It is being prosecuted by Assistant United States Attorney Michael Freeman of the Northern District of Ohio and Trial Attorney Dana Mulhauser of the Civil Rights Division of the Department of Justice.
Ohio Man Sentenced for Dealing Drugs in Greenbrier CountyRead the Press Release
BECKLEY, W.Va. – United States Attorney Mike Stuart announced today that a Toledo, Ohio drug dealer was sentenced in federal court in Beckley. William James Springer, 33, was sentenced to 96 months in prison for distribution of oxymorphone. Stuart praised the work of the Greenbrier Valley Drug and Violent Crime Task Force.
“An Ohio drug dealer getting pills from Detroit to distribute in Greenbrier County,” said United States Attorney Mike Stuart. “These out-of-state drug dealers have found every corner of our great state and are bringing devastation and misery to our communities. And we’re going to do our best to protect our citizens by locking them all up.”
Springer pled guilty in April, admitting that on October 5, 2016, he distributed oxymorphone pills to a confidential informant in Ronceverte. He further admitted that between September 2016 and December 2016 he was involved in distributing a total of about 300 40 mg oxymorphone pills in Greenbrier County, including pills which he distributed as charged in the indictment.
The investigation previously resulted in lengthy prison sentences for three other people who were involved with Springer in his scheme of bringing oxymorphone from Detroit to sell in Greenbrier County. Joshua Adam Smith, 36, of Lewisburg, pled guilty to distribution of oxymorphone and was sentenced to 96 months. Tremaine Dean Pool Jr., 23, of Romulus, Michigan, pled guilty to possession with intent to distribute oxymorphone and was sentenced to 40 months. Jessica Nicole Honaker, 26, of White Sulphur Springs, pled guilty to aiding and abetting the distribution of oxymorphone and received a sentence of 24 months.
Assistant United States Attorney John File handled the prosecution. United States District Court Judge Irene C. Berger imposed the sentence on Springer.
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North Dakota Investigation Receives DEA Administrator’s AwardRead the Press Release
FARGO - U.S. Attorney Christopher C. Myers announced that on July 18, 2018, Acting DEA Administrator Uttam Dhillon recognized a team of investigators and prosecutors with the "Administrator’s Award for Outstanding Group Achievement" at a ceremony in Washington, D.C. today for their teamwork in investigating a trans-national opiate trafficking organization. This is the first time an investigation in North Dakota has received this prestigious honor.
This case came to the attention of law enforcement as part of "Operation Denial," an Organized Crime and Drug Enforcement Task Force (OCDETF) investigation into the international trafficking of fentanyl and other lethal drugs, and was significantly aided by the national and international coordination led by the multi-agency Special Operations Division (S.O.D.) near Washington D.C. as part of "Operation Deadly Merchant." The investigation started in North Dakota on January 3, 2015, with the overdose death in
Grand Forks of 18-year-old Bailey Henke. To date, thirty-two (32) defendants have been charged as a result of the investigation.
This case was investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; U.S. Drug Enforcement Administration; U.S. Postal Inspection Service; Grand Forks Narcotics Task Force; Royal Canadian Mounted Police; Portland, Oregon, Police Bureau – Drugs and Vice Division; IRS-Criminal Investigations Division; Portland HIDTA Interdiction Task Force; Oregon State Police and the Grand Forks Police Department. The principal mission of the OCDETF program is to identify, disrupt, and dismantle the most serious drug trafficking organizations and those primarily responsible for the nation’s illegal drug supply.
U.S. Attorney Christopher C. Myers, Assistant U.S. Attorney Scott Kerin for the District of Oregon, and Trial Attorney Adrienne Rose of the Criminal Division’s Narcotic & Dangerous Drug Section are prosecuting the cases.
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New Orleans Pair Charged with Stealing Money from Deceased Elderly WomanRead the Press Release
U.S. Attorney Duane A. Evans announced that TRINA ROBAIR, age 44, and MICHAEL REED, age 62, both of New Orleans, Louisiana were charged yesterday with a one count Bill of Information charging them with Bank Larceny in relation to stealing at least $149,500 from an elderly deceased woman for whom ROBAIR was a caretaker, in violation of Title 18, United States Code, Section 2113(b).
According to the Bill of Information, REED was a handyman who performed work on the elderly woman’s home.
The charging document, filed in court, states that ROBAIR had access to the elderly woman’s accounts because she was incapacitated. ROBAIR did not have permission to steal the money. The Bill of Information further states that ROBAIR stole $149,500 and REED stole $20,000.
The statutory penalty for Bank Larceny is ten (10) years imprisonment, $250,000 fine, three (3) years supervised release, restitution and a $100 special assessment.
The case was investigated by the United States Postal Inspection Service and is being prosecuted by Assistant U.S. Attorney, Carter K. D. Guice, Jr.
New Orleans Man Pleads Guilty in Methamphetamine-Trafficking ConspiracyRead the Press Release
U.S. Attorney Duane A. Evans announced that GLENN MELANCON, age 50, of New Orleans pled guilty today to one count of conspiring to traffic methamphetamine in the Eastern District of Louisiana. MELANCON faces a maximum sentence of 20 years’ incarceration, a fine of up to $1,000,000 and at least 3 years of supervised release.
U.S. District Judge Susie Morgan set sentencing for MELANCON on October 24, 2018.
U.S. Attorney Evans praised the work of the United States Postal Inspection Service, Louisiana State Police, Jefferson Parish Sheriff’s Office, Texas Department of Public Safety, Texas Highway Patrol, Montgomery County (Texas) Sheriff’s Office, Immigration and Customs Enforcement, AMTRAK Police, and the Orleans Parish District Attorney’s Office. Assistant United States Attorney Brandon S. Long is in charge of the prosecution.
Michigan Resident Pleads Guilty to Structuring A Financial TransactionRead the Press Release
A Bloomfield Hills, Michigan resident, pleaded guilty today in Flint, Michigan to one count of structuring a financial transaction to avoid bank reporting requirements, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division.
According to court documents, Scott Zack, who entered his plea today, and David Katz, who pleaded guilty on June 12, owned and operated several medical management companies and a chiropractic facility in Michigan, including Health Systems Medical Management, LLC and Medical Management Partners, LLC. In July 2013, Scott Zack and David Katz withdrew cash in amounts of less than $10,000 from multiple bank branch locations in order to avoid the requirement that domestic banks file a currency transaction report for transactions in amounts exceeding $10,000. As part of their pleas, Zack and Katz acknowledged that during the period of their scheme their unlawful conduct involved more than $250,000.
In a related case, John Anthony Capella of Lantana, Florida pleaded guilty on May 29 to conspiracy to defraud the United States. According to court documents filed in that case, Capella did so by causing, for example, businesses he controlled to file false documents with the IRS, including a tax return that underreported substantial cash receipts.
Honorable Lisa V. Parker scheduled sentencing for February 19, 2019. Katz and Zack each face a maximum sentence of five years in prison, as well as a period of supervised release, restitution and monetary penalties.
Capella faces a maximum sentence of five years in prison, a $250,000 fine and three years of supervised release for conspiring to defraud the United States.
Acting Deputy Assistant Attorney General Goldberg thanked special agents of IRS Criminal Investigation, who conducted the investigation, and Tax Division Trial Attorneys Mark McDonald and William Guappone, who prosecuted this case. Acting Deputy Assistant Attorney General Goldberg also thanked the United States Attorney’s Office for the Eastern District of Michigan for its substantial assistance during the investigation.
More information about the Tax Division’s enforcement efforts is available on the Division’s website.
Metro Denver Man Charged with Wire Fraud After Implementing A Ponzi SchemeRead the Press Release
DENVER – Daniel B. Rudden, age 71, of Denver, Colorado, was charged by criminal complaint with one count of Wire Fraud after implementing a multi-million dollar Ponzi scheme, U.S. Attorney Bob Troyer and FBI Denver Division Special Agent in Charge Calvin Shivers announced. Rudden appeared yesterday at the hearing pursuant to an arrest warrant and was released on a personal recognizance bond.
According to court records, including the affidavit in support of the Criminal Complaint, on July 9, 2018, a California resident contacted the FBI to report she was defrauded of approximately $300,000 by Rudden. On one occasion, in January 2017, the victim wired $100,000 to Rudden and/or Rudden’s company Financial Visions (FV) at Colorado State Bank and Trust. Rudden told the victim her money would be used to “factor” funeral expenses. According to the victim, Rudden said he loaned people money to pay for funeral expenses until insurance payments were received or other payment arrangements could be made.
The affidavit alleges that Rudden ran his business as a Ponzi scheme and that he received about $55 million from approximately 150 investors located in Colorado and other states.
The matter is being investigated by the FBI, and the defendant is being prosecuted by Assistant U.S. Attorney Martha A. Paluch, Chief of the Economic Crime Section.
A criminal complaint is a probable cause charging document. Anyone accused of committing a felony violation of federal law has a constitutional right to be indicted by a grand jury. The charges in the complaint are allegations and the defendant is presumed innocent unless and until proven guilty.
Medical Doctor Convicted in Brooklyn Federal Court of Causing Overdose Death of a PatientRead the Press Release
A federal jury in Brooklyn today, following two weeks of trial, convicted Dr. Martin Tesher of 10 counts of unlawful distribution of oxycodone without legitimate medical purpose to five patients, one of whom died as a result two days after his last visit with the defendant. When sentenced by United States District Judge Raymond J. Dearie, Dr. Tesher faces a mandatory minimum sentence of 20 years’ imprisonment and a maximum of life in prison.
Attorney General Jeff Sessions, Richard P. Donoghue, United States Attorney for the Eastern District of New York, and James J. Hunt, Special Agent-in-Charge, Drug Enforcement Administration (DEA), New York Division, announced the verdict.
“It is incredible but true that some medical professionals have chosen to violate their oaths and exploit our nation's drug epidemic for profit, even at the cost of human lives,” stated Attorney General Sessions. “This doctor knowingly took advantage of drug addicts and even contributed to the death of a young man. The Department of Justice is relentlessly pursuing criminals like him: we have charged more than 200 doctors with opioid-related crimes since the beginning of last year. We are going to keep pursuing these cases because they help cut off the supply of drugs and stop fraudsters from exploiting vulnerable people. I want to thank the DEA, our partners at IRS, four local police departments and especially our fabulous prosecutors Jennifer Sasso and Penelope Brady for their hard work in this case. I believe that they have helped prevent many more New Yorkers from falling into addiction and death.”
“Dr. Tesher dispensed opioids to patients whom he knew were abusing illegal drugs and the tragic result was an overdose death,” stated United States Attorney Donoghue. “Today, the jury held Dr. Tesher responsible for the part he played in fueling the opioid epidemic by abandoning his responsibilities as a medical professional and for acting as a drug dealer with a prescription pad. This Office and our law enforcement partners will continue to work tirelessly to combat the opioid epidemic on all fronts, including prosecuting corrupt doctors who disregard the well-being of their patients by prescribing highly addictive drugs without legitimate medical purpose.”
“DEA doesn’t tell doctors how to practice medicine, DEA is a watchdog to ensure doctors’ prescriptions are written for the right reason and betterment of their patient’s health,” stated DEA Special Agent-in-Charge Hunt. “This trial brings to light how opioid traffickers can hide in plain sight, like Dr. Tesher; and how heartbreaking drug addiction is to families and friends of substance abusers. I commend the U.S. Attorney’s Office for the Eastern District of New York and the DEA’s Long Island District Office Tactical Diversion Squad on their diligent work throughout this investigation. DEA will continue to work with our federal, state and local law enforcement partners to battle opioid traffickers and suppliers at all levels.”
The evidence at trial established that between June 2013 and January 2017, Dr. Tesher, a medical doctor specializing in general family care, prescribed oxycodone and fentanyl on a continuing basis without a legitimate medical purpose to patients after he learned, or had reason to believe, that these patients were addicted to drugs. The five patients either told Dr. Tesher that they had a drug addiction, had previously been treated for drug addiction, or tested positive for illegal drugs such as cocaine or heroin during the course of their treatment by the defendant. While under Dr. Tesher’s care, Nicholas Benedetto, 27, tested positive for cocaine, heroin and methadone in addition to oxycodone and fentanyl. Dr. Tesher continued to prescribe oxycodone and fentanyl to Benedetto despite indicators that he was abusing those drugs. Benedetto was found dead of a fatal combination of oxycodone and fentanyl on March 5, 2016, two days after he had been prescribed oxycodone and fentanyl patches by Dr. Tesher. According to a government expert witness, none of the patients for whom Tesher is charged in the superseding indictment had verified medical conditions that would require the prescription of Schedule II opioids.
The government’s investigation was led by the DEA’s Long Island Tactical Diversion Squad, which is comprised of agents and officers of the DEA, Internal Revenue Service, Nassau County Police Department (NCPD), Suffolk County Police Department, Port Washington Police Department and Rockville Centre Police Department. The DEA Tactical Diversion Squad also worked in conjunction with officers and agents of the New York City Police Department, Criminal Enterprise Investigations, the Department of Health & Human Services, Office of Inspector General, the New York City Department of Investigation and NCPD’s Asset Forfeiture and Intelligence Bureau.
This case is the latest in a series of federal prosecutions by the United States Attorney’s Office for the Eastern District of New York as part of the Prescription Drug Initiative. In January 2012, this Office and the DEA, in conjunction with the five District Attorneys in this district, the Nassau and Suffolk County Police Departments, the New York City Police Department and the New York State Police, along with other key federal, state and local government partners, launched the Initiative to mount a comprehensive response to what the United States Department of Health and Human Services Centers for Disease Control and Prevention called an epidemic increase in the abuse of so-called opioid analgesics. To date, the Initiative has brought over 160 federal and local criminal prosecutions, including the prosecution of 19 health care professionals; taken civil enforcement actions against a hospital, a pharmacy and pharmacy chain; removed prescription authority from numerous rogue doctors, and expanded information-sharing among enforcement agencies to better target and pursue drug traffickers. The Initiative also is involved in an extensive community outreach program to address the abuse of pharmaceuticals.
The government’s case is being handled by the Office’s International Narcotics and Money Laundering Section. Assistant United States Attorneys Jennifer M. Sasso and Penelope Brady are in charge of the prosecution.
The Defendant:
DR. MARTIN TESHER
Age: 82
Manhattan, New YorkE.D.N.Y. Docket No. 17-CR-523 (RJD)
Medical Device Maker AngioDynamics Agrees to Pay $12.5 Million to Resolve False Claims Act AllegationsRead the Press Release
SYRACUSE, NEW YORK - Latham, New York-based medical device manufacturer AngioDynamics, Inc. has agreed to pay the United States a total of $12.5 million to resolve allegations that the company caused healthcare providers to submit false claims to Medicare, Medicaid, and other federal healthcare programs relating to the use of two medical devices, LC Bead and the Perforator Vein Ablation Kit (PVAK), the Justice Department announced today.
“The Justice Department is committed to holding medical device manufacturers accountable, which includes requiring that they follow all laws designed to ensure that medical devices are safe and effective,” said Chad R. Readler, Acting Assistant Attorney General for the Justice Department’s Civil Division. “When manufacturers make misleading statements concerning the use of their products in ways that have not been cleared by the FDA, it undermines patient care. Taxpayers and patients deserve better.”
AngioDynamics will pay $11.5 million to resolve allegations that the company caused false claims to be submitted to government healthcare programs for procedures involving an unapproved drug-delivery device that was marketed with false and misleading promotional claims.. The government alleged that, from May 2006 through December 2011, AngioDynamics served as the U.S. distributor for Biocompatibles plc, the manufacturer of LC Bead, and marketed LC Bead for use as a drug-delivery device in combination with chemotherapy drugs. Moreover, AngioDynamics personnel routinely claimed that this particular use of LC Bead, which FDA had twice declined to approve, was “better”, “superior”, “safer” and “less toxic” than alternative treatments, even though there was insufficient clinical evidence to support the truthfulness of these claims. The government also alleged that AngioDynamics was aware that many insurers declined to provide coverage for certain LC Bead procedures and, as a result, instructed healthcare providers to use inaccurate billing codes when submitting claims for such uses. The federal share of the civil settlement is approximately $10.9 million, and the state Medicaid share of the civil settlement is approximately $600,000. The government previously resolved related criminal and civil claims against Biocompatibles in November 2016.
“The basic legal rule in this area could be mastered by a third-grader: Don’t lie,” said U.S. Attorney John F. Bash for the Western District of Texas. “If you do, you will be held accountable. This settlement reflects that.”
AngioDynamics will separately pay $1 million to resolve allegations that the company caused false claims to be submitted to federal healthcare programs in connection with the use of the PVAK, later renamed the 400 micron kit. In 2008, AngioDynamics acquired the PVAK as part of a product suite that utilizes a laser to close or collapse malfunctioning veins. The PVAK was FDA-cleared only for use in treating superficial veins, and, in 2011, AngioDynamics requested that the FDA clearance include the treatment of perforator veins. However, FDA informed the company that the treatment of perforator veins constitutes a new indication for which safety and efficacy were unknown. As a result, AngioDynamics voluntarily recalled the PVAK and re-issued the product under a new name, the 400 micron kit that did not refer to the unapproved use of treating perforator veins. Notwithstanding the recall and rebranding, certain AngioDynamics personnel, as part of a continued campaign to market the device to treat perforator veins, falsely represented to providers that Medicare would cover this use despite Medicare coverage restrictions to the contrary.
“This settlement reflects the expectation that medical device manufacturers will give doctors accurate information about devices they manufacture and underscores the vital role of the False Claims Act in protecting the public fisc,” said United States Attorney Grant C. Jaquith for the Northern District of New York. “We will continue to use all available tools to help secure patient safety and ensure the integrity of healthcare services claims submitted to the government.”
“Medical device makers have an obligation to provide truthful information to protect both patients and the integrity of government health programs,” said Special Agent in Charge Scott J. Lampert of the U.S. Health and Human Services Department Office of Inspector General. “We will continue to thoroughly investigate health care fraud allegations.”
The civil settlement relating to LC Bead resolves a lawsuit filed under the whistleblower provision of the False Claims Act by Mr. Ryan Bliss, who formerly worked in the marketing departments of both AngioDynamics and Biocompatibles. The Act permits private parties to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. The civil lawsuit was filed in the Western District of Texas and is captioned United States ex rel. Ryan Bliss v. Biocompatibles, Inc., et al., Case No. SA-13-CA-0667-XR. As part of today’s resolution, Mr. Bliss will receive approximately $2.3 million from the settlement relating to LC Bead.
The settlements with AngioDynamics were the result of a coordinated effort among the U.S. Attorney’s Offices for the Western District of Texas and the Northern District of New York and the Civil Division’s Commercial Litigation Branch, with assistance from the FDA’s Office of Chief Counsel, HHS’ Office of Counsel to the Inspector General, and the Department of Defense’s Defense Criminal Investigative Service. The investigations were conducted by the FDA’s Office of Criminal Investigations; the HHS Office of Inspector General investigated allegations in the settlement involving PVAK.
The claims resolved by the civil settlements are allegations only, and there have been no determinations of liability.
Medical Device Maker AngioDynamics Agrees to Pay $12.5 Million to Resolve False Claims Act AllegationsRead the Press Release
WASHINGTON – Latham, New York-based medical device manufacturer AngioDynamics, Inc. has agreed to pay the United States a total of $12.5 million to resolve allegations that the company caused healthcare providers to submit false claims to Medicare, Medicaid, and other federal healthcare programs relating to the use of two medical devices, LC Bead and the Perforator Vein Ablation Kit (PVAK), the Justice Department announced today.
“The Justice Department is committed to holding medical device manufacturers accountable, which includes requiring that they follow all laws designed to ensure that medical devices are safe and effective,” said Acting Assistant Attorney General Chad A. Readler for the Justice Department’s Civil Division. “When manufacturers make misleading statements concerning the use of their products in ways that have not been cleared by the FDA, it undermines patient care. Taxpayers and patients deserve better.”
AngioDynamics will pay $11.5 million to resolve allegations that the company caused false claims to be submitted to government healthcare programs for procedures involving an unapproved drug-delivery device that was marketed with false and misleading promotional claims.. The government alleged that, from May 2006 through December 2011, AngioDynamics served as the U.S. distributor for Biocompatibles plc, the manufacturer of LC Bead, and marketed LC Bead for use as a drug-delivery device in combination with chemotherapy drugs. Moreover, AngioDynamics personnel routinely claimed that this particular use of LC Bead, which FDA had twice declined to approve, was “better”, “superior”, “safer” and “less toxic” than alternative treatments, even though there was insufficient clinical evidence to support the truthfulness of these claims. The government also alleged that AngioDynamics was aware that many insurers declined to provide coverage for certain LC Bead procedures and, as a result, instructed healthcare providers to use inaccurate billing codes when submitting claims for such uses. The federal share of the civil settlement is approximately $10.9 million, and the state Medicaid share of the civil settlement is approximately $600,000. The government previously resolved related criminal and civil claims against Biocompatibles in November 2016.
“The basic legal rule in this area could be mastered by a third-grader: Don’t lie,” said U.S. Attorney John F. Bash for the Western District of Texas. “If you do, you will be held accountable. This settlement reflects that.”
AngioDynamics will separately pay $1 million to resolve allegations that the company caused false claims to be submitted to federal healthcare programs in connection with the use of the PVAK, later renamed the 400 micron kit. In 2008, AngioDynamics acquired the PVAK as part of a product suite that utilizes a laser to close or collapse malfunctioning veins. The PVAK was FDA-cleared only for use in treating superficial veins, and, in 2011, AngioDynamics requested that the FDA clearance include the treatment of perforator veins. However, FDA informed the company that the treatment of perforator veins constitutes a new indication for which safety and efficacy were unknown. As a result, AngioDynamics voluntarily recalled the PVAK and re-issued the product under a new name, the 400 micron kit that did not refer to the unapproved use of treating perforator veins. Notwithstanding the recall and rebranding, certain AngioDynamics personnel, as part of a continued campaign to market the device to treat perforator veins, falsely represented to providers that Medicare would cover this use despite Medicare coverage restrictions to the contrary.
“This settlement reflects the expectation that medical device manufacturers will give doctors accurate information about devices they manufacture and underscores the vital role of the False Claims Act in protecting the public fisc,” said United States Attorney Grant C. Jaquith for the Northern District of New York. “We will continue to use all available tools to help secure patient safety and ensure the integrity of healthcare services claims submitted to the government.”
“Medical device makers have an obligation to provide truthful information to protect both patients and the integrity of government health programs,” said Special Agent in Charge Scott J. Lampert of the U.S. Health and Human Services Department Office of Inspector General. “We will continue to thoroughly investigate health care fraud allegations.”
The civil settlement relating to LC Bead resolves a lawsuit filed under the whistleblower provision of the False Claims Act by Mr. Ryan Bliss, who formerly worked in the marketing departments of both AngioDynamics and Biocompatibles. The Act permits private parties to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. The civil lawsuit was filed in the Western District of Texas and is captioned United States ex rel. Ryan Bliss v. Biocompatibles, Inc., et al., Case No. SA-13-CA-0667-XR. As part of today’s resolution, Mr. Bliss will receive approximately $2.3 million from the settlement relating to LC Bead.
The settlements with AngioDynamics were the result of a coordinated effort among the U.S. Attorney’s Offices for the Western District of Texas and the Northern District of New York and the Civil Division’s Commercial Litigation Branch, with assistance from the FDA’s Office of Chief Counsel, HHS’ Office of Counsel to the Inspector General, and the Department of Defense’s Defense Criminal Investigative Service. The investigations were conducted by the FDA’s Office of Criminal Investigations; the HHS Office of Inspector General investigated allegations in the settlement involving PVAK.
The claims resolved by the civil settlements are allegations only, and there have been no determinations of liability.
Media Advisory: United States Attorney’s Office for the Northern District of Iowa to Host Roundtable Discussion with More Than 20 Community Organizations on Combatting Sexual Harassment in HousingRead the Press Release
SIOUX CITY, IA – The United States Attorney’s Office for the Northern District of Iowa and the Department of Justice’s Civil Rights Division will host a roundtable for community organizations to discuss the problem of sexual harassment in housing. The roundtable is designed to build collaboration among key partners in an effort to identify barriers to reporting sexual harassment in housing and increase awareness of the DOJ’s enforcement efforts. The U.S. Attorney’s Office anticipates the involvement of more than 20 different community organizations.
United States Attorney Peter Deegan will be present and joined by Nancy Langworthy, a Senior Attorney for the DOJ’s Civil Rights Division in Washington, D.C.
Event Details
When: 10:00AM-12:00PM, Friday, July 20, 2018
Where: Sioux City Public Museum, 607 4th Street, Sioux City, IA 51101
This is a “pen and pad” opportunity for the press. Photography permitted. A press release will be provided and interview opportunities will be available.
Follow us on Twitter @USAO_NDIA.
Maryland Man Sentenced to Jail Term for Fraudulent Billing Scheme Targeting D.C. Public SchoolsRead the Press Release
WASHINGTON – Charles E. Scott, Jr., a vendor who claimed to be providing tutoring and mentoring services for students with special needs, was sentenced today to 26 weekends in jail, to be followed by 180 days of home confinement, for a scheme in which he collected more than $75,000 from the District of Columbia Public Schools for work that never was performed.
The announcement was made by U.S. Attorney Jessie K. Liu, Nancy McNamara, Assistant Director in Charge of the FBI’s Washington Field Office, and District of Columbia Inspector General Daniel W. Lucas.
Scott, 38, of Baltimore, Md., pled guilty in April 2018 in the U.S. District Court for the District of Columbia to mail fraud and identity theft. He was sentenced by the Honorable Rudolph Contreras. The judge sentenced him to five years of probation, during which he must serve the jail term and complete the home confinement, as well as perform 100 hours of community service. He also is required to pay $75,398 in restitution to the District of Columbia Public Schools and an identical amount in a forfeiture money judgment.
According to a statement of offense filed as part of the plea, the scheme took place from approximately February 2013 through December 2013. During that time, Scott submitted invoices, timesheets and other documents to the Office of Special Education, a component of the District of Columbia Public Schools (DCPS). The Office of Special Education manages the school system’s Compensatory Education Program.
The Compensatory Education Program awards services to eligible students to assist with their educational needs and development. Students awarded compensatory education services have learning, mental, and/or behavioral disabilities that create an educational barrier that prevents them from reaping the full benefits of education. Services consist of tutoring, individualized education, monitoring, speech therapy, occupational therapy, and behavioral and psychological analysis. Once DCPS approves specific services, parents or guardians receive letters specifying the services that can be provided and it is up to the parent or guardian to identify an independent provider to perform the authorized services.
Scott’s invoices included the names and dates of birth for 10 minor children for whom he claimed to have performed services. The accompanying timesheets included what purported to be the signatures of the parents or guardians whose children had purportedly received the services as well as the signatures of the tutors who supposedly did the work. Nearly all of what purported to be signatures of the parents and guardians were forged. Tutors’ signatures also were forged.
Scott did not have permission to use the names and dates of the children listed on his invoices and did not have approval from parents or guardians to sign their names.
All told, Scott obtained a total of $75,398 for services that were never performed. In addition, the District of Columbia disputed and never paid him for $20,314 worth of invoices and timesheets that he submitted for services that never were performed.
In announcing the sentence, U.S. Attorney Liu, Assistant Director in Charge McNamara, and Inspector General Lucas commended the work of those who investigated the case from the FBI’s Washington Field Office and the District of Columbia Office of the Inspector General. They also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Assistant U.S. Attorney Diane Lucas, who is handling forfeiture issues, former Assistant U.S. Attorney Adrienne Dedjinou, and Paralegal Specialists Joshua Fein, Aisha Keys, and Kristy Penny. Finally, they expressed appreciation for the work of Assistant U.S. Attorney Peter C. Lallas, who is prosecuting the case.
Marion County, Illinois Man to Serve 14 Years in Prison on Bath Salts Related ChargesRead the Press Release
On July 17, 2018, a Marion Illinois man was sentenced to prison on charges related to Alpha-Pyrrolidinopentiophenone (Alpha-PVP) (also known as "bath salts), United States Attorney for the Southern District of Illinois, Donald S. Boyce, announced today.
Dennis R. Thacker, Jr., 49, of Alma, Illinois, was sentenced to 168 months in prison followed by three years of supervised release. Thacker, Jr., previously plead guilty to three counts in a federal Indictment. Count 1 charged that from 2016, until on or about December 2017, in Clay County and Marion County, and elsewhere, Thacker, Jr., conspired to distribute, and possess with intent to distribute, Alpha-PVP, a Schedule I controlled substance, in violation of federal law. Count 2 charged that on June 2, 2017, in Clay County, Thacker, Jr., distributed a mixture or substance containing Alpha-PVP and Count 3 charged that on June 2, 2017, in Marion County, Thacker, Jr., possessed with the intent to distribute a mixture or substance containing Alpha-PVP.
The investigation was conducted by the Flora Police Department, the Southeastern Illinois Drug Task Force, and the Clay County Sheriff’s Office.
Man Pleads Guilty to Spice Conspiracy and Distribution CrimesRead the Press Release
NORFOLK, Va. – A California man pleaded guilty today to conspiracy to traffic in synthetic cannabinoids, commonly known as “spice,” containing the active ingredient 5-fluoro-ADB. 5-fluoro-ADB has been a schedule I controlled substance since April 10, 2017.
According to court documents, from late September 2016 to August 2017, Robert L. Hoeflein, II, 24, of Long Beach, participated in a conspiracy to sell spice from Odds and Ends II and Happy Daze, establishments located in Chesapeake. In August 2014, Hoeflein was arrested by Chesapeake Police following an investigation that revealed that he was selling spice from Happy Daze. Following his 2014 arrest and conviction for spice possession in Chesapeake General District Court, Hoeflein continued to sell spice from Happy Daze. By early 2016, Hoeflein moved to Long Beach, where he opened up a shop very similar in appearance to Happy Daze, which he named Cali Daze.
In September 2016, Hoeflein entered into an agreement with co-conspirator William Barnes that allowed Barnes to use the space at Odds and Ends II to open up a shop to sell spice. Barnes placed his spice orders with Hoeflein, who had the connection to the ultimate source of supply. At Hoeflein’s request, the source would ship the spice directly to Barnes, who received 25 parcels of spice at between $7,000 and $9,000 per parcel. Hoeflein and Barnes split the profits from the spice sales at Odds and Ends II.
Hoeflein pleaded guilty to conspiracy to distribute and possess with intent to distribute 5-fluoro-ADB, and faces a maximum penalty of 20 years in prison when sentenced on November 5. 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.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, Thomas L. Chittum, III, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, Scott W. Hoernke, Acting Special Agent in Charge for the Drug Enforcement Administration’s (DEA) Washington Field Division, Eric Shen, Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service, and Col. K.L. Wright, Chief of Chesapeake Police, made the announcement after U.S. District Judge Raymond A. Jackson accepted the plea. Assistant U.S. Attorney Kevin Hudson is prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:18-cr-31.
Maine Man Sentenced for Opioid Trafficking ConspiracyRead the Press Release
BOSTON – A Maine man was sentenced yesterday in federal court in Boston for his role in an opioid trafficking conspiracy involving the distribution of oxycodone from Florida to Massachusetts and Maine.
Gorky Gonzalez, 26, of Biddeford, Maine, was sentenced by U.S. District Court Judge Denise J. Casper to 54 months in prison and three years of supervised release. In April 2018, Gonzalez pleaded guilty to one count of conspiracy to distribute and to possess with intent to distribute oxycodone.
Gonzalez was arrested in March 2017 along with numerous co-defendants for their roles in a widespread conspiracy involving opioid trafficking and money laundering offenses in Massachusetts and Florida. Their arrests were the result of a three-year federal investigation into opioid-trafficking in New England.
Between September 2016 and November 2016, Gonzalez obtained sizeable quantities of oxycodone intended for distribution that were shipped from Miami, Fla., to Massachusetts and then transported to Maine. Payment for the oxycodone pills was then delivered to co-conspirators in Massachusetts, who then forwarded the money to the source of supply in Florida.
United States Attorney Andrew E. Lelling; Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration, Boston Field Division; Kristina O’Connell, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; Delany De Leon-Colon, Acting Inspector in Charge of the U.S. Postal Inspection Service; John Gibbons, U.S. Marshal for the District of Massachusetts; and Mickey D. Leadingham, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms & Explosives, Boston Field Division, made the announcement today. Valuable assistance was provided by the Massachusetts State Police and the Biddeford (Maine), Framingham, Haverhill, Lawrence, Manchester (N.H.), Methuen, Millis, Natick, Stoughton, and Waltham Police Departments. Assistant U.S. Attorneys Nadine Pellegrini and Craig Estes of Lelling’s Narcotics and Money Laundering Unit are prosecuting the cases.
Luzerne County Man Indicted for Drug Trafficking and Firearms OffensesRead the Press Release
SCRANTON—The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Brandon Diggs, age 28, of Kingston, Pennsylvania, was indicted on July 10, 2018, by a federal grand jury for drug trafficking and firearms offenses. The indictment was unsealed today following Diggs’ arraignment before United States District Court Judge Malachy E. Mannion. Diggs was detained pending trial.
According to United States Attorney David J. Freed, the indictment alleges that Diggs possessed with the intent to distribute heroin, and possessed a 9mm Springfield Arms handgun as a convicted felon on June 9, 2018, in Luzerne County.
The matter was investigated by the Bureau of alcohol, Tobacco, Firearms, and Explosives (ATF) and the Kingston Police. Assistant U.S. Attorney Francis P. Sempa is prosecuting the case.
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.
This case was also brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.
Indictments and Criminal Informations are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law is life imprisonment, a term of supervised release following imprisonment, and a fine for the gun offense. That charge also carries a mandatory minimum sentence of 15 years’ imprisonment. The maximum penalty for the drug offense is 20 years’ imprisonment. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Leader of MS-13 East Coast Program Sentenced to over 19 Years in Prison for RICO ConspiracyRead the Press Release
BOSTON – The leader of the MS-13 East Coast Program was sentenced today in federal court in Boston for racketeering conspiracy.
Jose Adan Martinez Castro, a/k/a “Chucky,” 29, a Salvadoran national formerly residing in Richmond, Va., was sentenced by U.S. District Court Judge F. Dennis Saylor IV to 235 months in prison, the top of the sentencing range recommended by the U.S. Sentencing Guidelines. Castro will be subject to deportation upon completion of his sentence. In November 2017, Castro pleaded guilty to conspiracy to conduct enterprise affairs through a pattern of racketeering activity, more commonly referred to as RICO or racketeering conspiracy.
After a multi-year investigation, Castro was one of dozens of leaders, members, and associates of MS-13 named in a superseding indictment unsealed in January 2016 that targeted MS-13’s criminal activities in Massachusetts. According to court documents, MS-13 members engaged in a variety of racketeering acts and crimes of violence, including six different murders committed by MS-13 members in Massachusetts between October 2014 and January 2016.
Castro was one of 49 defendants to be convicted as part of this case. All nine defendants who went to trial were convicted and 40 others pleaded guilty.
MS-13 is a transnational criminal organization run by leaders in El Salvador, with thousands of members across the United States. In Massachusetts, as in other states, MS-13 is organized in the form of “cliques” or local branches. Groups of cliques are organized into “programs” that act under the larger mantle of MS-13. This creates a hierarchy that expedites communication and orders passed down from the leadership in El Salvador to the gang members on streets in the United States.
During the investigation, Castro was identified as the leader of MS-13’s East Coast Program. Most of the cliques in Massachusetts fall under the East Coast Program, which also has cliques in Maryland, Virginia, New York, New Jersey, North Carolina, Texas, and Ohio.
On Dec. 13, 2015, using a cooperating witness, law enforcement recorded a meeting of the East Coast Program leadership at Castro’s home in Richmond. The recorded meeting provided evidence about the organizational structure, leadership structure, and recruitment system of MS-13 as well as the means, methods, objectives, and operating principles of the gang. Leaders of the East Coast Program cliques from Massachusetts, Ohio, Texas, and Virginia attended the meeting.
During the meeting, Castro and others discussed how there was enough space in the East Coast Program for the all of the assembled MS-13 cliques to work cooperatively. Castro and others also discussed the need for the cliques to be better at planning and coordinating hits (i.e., murders) and Castro confirmed that murders generally had to be approved by MS-13 leaders before the local members could carry them out. The group also discussed sending money to El Salvador to support MS-13, the need to work together to increase the gang’s strength and control, and the need to kill anyone who provided information against the gang. An El Salvadoran-based leader of MS-13 also participated in the meeting via the phone and provided direction to the assembled leaders.
United States Attorney Andrew E. Lelling; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Peter C. Fitzhugh, Special Agent in Charge of Homeland Security Investigations in Boston; Colonel Kerry A. Gilpin, Superintendent of the Massachusetts State Police; Commissioner Thomas Turco of the Massachusetts Department of Corrections; Essex County Sheriff Kevin F. Coppinger; Suffolk County Sheriff Steven W. Thompkins; Suffolk County District Attorney Daniel F. Conley; Middlesex County District Attorney Marian T. Ryan; Essex County District Attorney Jonathan Blodgett; Boston Police Commissioner William Evans; Chelsea Police Chief Brian A. Kyes; Everett Police Chief Steven A. Mazzie; Lynn Police Chief Michael Mageary; Revere Police Chief James Guido; Somerville Police Chief David Fallon; and Wes Adams, State’s Attorney, Anne Arundel County (Maryland), Anne Arundel County State’s Attorney’s Office, made the announcement today.
Laurel Man Sentenced to over 15 Years in Federal Prison for MethamphetamineRead the Press Release
Hattiesburg, Miss. – Jamie Wheat, 42, of Laurel, was sentenced yesterday by U.S. District Judge Keith Starrett to 188 months in federal prison, followed by seven years of supervised release, for possession with intent to distribute methamphetamine, announced U.S. Attorney Mike Hurst and Drug Enforcement Administration (DEA) Assistant Special Agent in Charge J. Derryle Smith. Wheat was also ordered to pay a $5,000 fine.
During a traffic stop on May 1, 2017, Wheat was found to be in possession of 446.24 grams of methamphetamine. As part of an ongoing investigation by the DEA, agents learned that Wheat was traveling to deliver the methamphetamine to his co-defendants, Dexter Jones and Mitchell Jones. Wheat pled guilty to the federal charge on March 29, 2018.
Mitchell Jones pled guilty before Judge Starrett on March 29, 2018, and will be sentenced on August 21, 2018. Dexter Jones pled guilty before Judge Starrett on April 5, 2018, and will be sentenced on September 6, 2018.
The case was investigated by the Drug Enforcement Administration, the Mississippi Bureau of Narcotics, the Lamar County Sheriff’s Department, and the Jones County Sheriff’s Department. It was prosecuted by Assistant United States Attorney Shundral H. Cole.
Laconia Man Sentenced to Four Years in Prison for Seven Bank Robberies in New Hampshire and MassachusettsRead the Press Release
CONCORD, N.H. - Chaka Meredith, 43, previously of Laconia, New Hampshire was sentenced to 48 months in federal prison for committing seven unarmed bank robberies in late 2016 and early 2017, United States Attorney Scott W. Murray announced today.
On January 18, 2018, Meredith pleaded guilty to the following crimes: (1) the December 29, 2016, robbery of a Bank of America branch location in Boston, Massachusetts; (2) the January 3, 2017, robbery of an East Boston Savings Bank branch location in Jamaica Plain, Massachusetts; (3) the January 11, 2017, robbery of a Meredith Village Savings Bank branch location in Laconia, New Hampshire; (4) the January 17, 2017, robbery of a Santander Bank branch location in Lawrence, Massachusetts; (5) the January 24, 2017, robbery of a TD Bank branch location in Lawrence, Massachusetts; (6) the January 25, 2017, robbery of a Lowell Five Cent Savings Bank branch location in Pepperell, Massachusetts; and (7) the January 30, 2017, robbery of a Santander Bank branch location in Plaistow, New Hampshire. The bank robberies proceeded in much the same fashion with Meredith presenting a demand note, receiving a sum of cash, and proceeding to flee on foot. Meredith has been in custody since his arrest by the Lawrence, Massachusetts Police on February 1, 2017.
Meredith was originally indicted by a federal grand jury sitting in Concord, New Hampshire, with the Plaistow robbery. He waived venue and agreed to plead guilty to the Massachusetts robberies in order to resolve all of his pending charges in both Massachusetts and New Hampshire resulting from the month-long bank robbery spree.
Following his release from prison, Meredith will serve 3 years on supervised release. He was also ordered to pay $10,438 in restitution to the seven banks he robbed.
“Bank robberies jeopardize the safety of bank employees, as well as members of the public,” said U.S. Attorney Murray. “In our efforts to reduce crime and protect our citizens, the law enforcement community works together to identify and prosecute those who commit bank robberies and other crimes that undermine public safety.”
“As a result of the close and efficient collaboration with our law enforcement partners, Chaka Meredith will now spend the next several years behind bars paying for his multi-state crime spree. The FBI is extremely grateful that nobody was injured by this serial bank robber, and we’ll continue to do everything we can to identify and disrupt others like him who commit violent crimes,” said Harold H. Shaw, Special Agent in Charge, FBI Boston Division.
This matter was investigated by the Federal Bureau of Investigations, the Laconia Police Department, the Plaistow Police Department, the Belknap County Sheriff’s Department, the Brookline, MA Police Department, the Lawrence, MA Police Department, the Pepperell, MA Police Department and the Massachusetts State Police. The Middlesex, Essex, and Suffolk District Attorneys’ Offices in Massachusetts as well as the New Hampshire Attorney General’s Office also provided invaluable assistance to investigators. The case was prosecuted by Assistant U.S. Attorney Charles L. Rombeau.
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Kansas Man Convicted of Producing Child PornographyRead the Press Release
A Lindsborg, Kansas man who traveled to the Philippines and had sex with minor females there pleaded guilty to three counts of production of child pornography.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division and U.S. Attorney Stephen R. McAllister of the District of Kansas made the announcement.
Anthony Shultz, 55, helicopter pilot, was charged by complaint in July 2016 and pleaded guilty before U.S. District Judge Eric F. Melgren of the District of Kansas. Sentencing is scheduled for December 6, 2018.
According to admissions made in conjunction with the guilty plea, Shultz engaged in sex acts with minor females in the Philippines. He videotaped his sexual encounters with two minors and transported the videos to his home in Kansas. One of the girls was only 12 years old at the time; the other was 15 years old. In one of the videos, Shultz is seen giving the 15-year-old money after having sex with her. Shultz also produced child pornography of an 8-year-old girl in the Philippines by communicating on Skype with the child’s mother and directing the mother to expose the child’s genitals and live-stream it on web camera.
The FBI investigated the case. Trial Attorney Lauren E. Britsch of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Jason Hart of the District of Kansas prosecuted the case.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and 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.
Justice Department Reaches Settlement Agreement with Wifi Alliance Resolving the USERRA Claims of United States Army Reserve OfficerRead the Press Release
Acting Assistant Attorney General John Gore of the Civil Rights Division and John F. Bash, United States Attorney for the Western District of Texas, today announced that the Department of Justice has reached a settlement agreement with WiFi Alliance, a non-profit organization headquartered in Austin, Texas. The settlement agreement resolves allegations that WiFi Alliance violated the employment rights of Lieutenant Colonel (LTC) Charles O’Donnell, an Army Reservist, under the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA). USERRA safeguards the rights of uniformed servicemembers, including Reservists, to all benefits of employment following periods of absence due to military service obligations.
According to the complaint, LTC O’Donnell’s military service was a motivating factor in WiFi Alliance’s decision to terminate his employment in 2016 as part of a reduction in force. The layoff was concurrent with his military duty, which supported West Point Admissions at the United States Military Academy.
LTC O’Donnell has served more than 22 years in the Armed Forces. He was a program manager with WiFi Alliance for three years.
Under the terms of the settlement, WiFi Alliance has agreed to pay $62,500 in back pay to LTC O’Donnell. In addition, WiFi Alliance has conducted a company-wide training on servicemember rights, and agreed to review and revise, if necessary, its anti-discrimination policies and procedures to ensure that current and future employees are aware of, and protected by, their USERRA rights.
“The men and women of our Armed Forces expect and are entitled to the peace of mind of knowing that their civilian employment will not be jeopardized because they serve our country,” said Acting Assistant Attorney General John Gore of the Civil Rights Division. “Through this lawsuit, the Department of Justice reaffirms its commitment to protecting the employment rights of the members of our Armed Forces.”
“We are pleased that our office was able to work alongside Acting Assistant Attorney General Gore and the dedicated career attorneys in the Civil Rights Division to obtain an agreement that will ensure that LTC O’Donnell will be compensated and that WiFi Alliance will train its supervisors in order to guarantee continued compliance with USERRA,” said United States Attorney John F. Bash of the Western District of Texas.
LTC O’Donnell initially filed a complaint with the Department of Labor’s Veterans’ Employment and Training Service (VETS), which investigated this matter and attempted to reach a resolution between the parties. After resolution efforts failed, VETS referred the complaint to the Justice Department’s Civil Rights Division, Employment Litigation Section. The lawsuit, filed on March 1, was a collaborative initiative between the Civil Rights Division and the U.S. Attorney’s Office for the Western District of Texas.
Civil Rights Division Trial Attorney Torie Atkinson and Assistant United States Attorney James Dingivan represented LTC O’Donnell in this matter.
The Justice Department’s Civil Rights Division has given high priority to the enforcement of servicemembers’ rights under USERRA. Additional information about USERRA can be found on the Justice Department’s websites at http://www.justice.gov/crt/employment- litigation-section and www.servicemembers.gov, as well as on the Labor Department’s website at www.dol.gov/vets/programs/userra/main.htm.
Justice Department Announces Resolution with NPB Neue Privat Bank AGRead the Press Release
The Department of Justice announced today that NPB Neue Privat Bank (NPB) reached a resolution with the Tax Division. NPB will pay a penalty of $5 million.
“The Department of Justice is committed to ending the practice of using foreign bank accounts to evade taxes,” said Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division. “Taxpayers and financial institutions should take notice that the Department is continuing to aggressively pursue these cases.”
According to the terms of the non-prosecution agreement signed today, NPB agrees to cooperate in any related criminal or civil proceedings, demonstrate its implementation of controls to stop misconduct involving undeclared U.S. accounts and pay a penalty in return for the Department’s agreement not to prosecute this bank for tax-related criminal offenses.
NPB is a Swiss private bank based in Zurich, Switzerland. Until 2012, NPB conducted a U.S. cross-border banking business that aided and assisted certain of its U.S. clients in opening and maintaining undeclared accounts in Switzerland and concealing the assets and income they held in these accounts from the U.S. government. NPB offered a variety of traditional Swiss banking services that it knew could assist, and did in fact assist, U.S. clients in the concealment of assets and income from the IRS, including the use of numbered accounts and hold mail services.
NPB signed agreements with individual external asset managers or external asset management firms, whereby clients of the external asset manager could open and maintain accounts at NPB, with account management services being provided by the external asset manager. Almost all of NPB’s U.S. accounts were managed by external asset managers, for whom it provided custodial and limited banking services. In such cases, NPB generally did not contact the clients directly once they had opened their account. The Bank required an external asset manager mandate, so that communication about asset management and investment decisions were done between the U.S. customer and their external asset manager(s). In a few circumstances, NPB managed U.S. customers directly without an external asset manager. In those cases, the Bank required the U.S. customer to sign a direct asset management mandate, allowing the Bank to make investment decisions for the account.
In 2001, NPB entered into a Qualified Intermediary Agreement (QI Agreement) with the Internal Revenue Service (IRS). The Qualified Intermediary regime provided a comprehensive framework for U.S. information reporting and tax withholding by a non-U.S. financial institution with respect to U.S. securities. The QI Agreement required NPB to obtain IRS Forms W-9 and to undertake IRS Form 1099 reporting for new and existing U.S. clients engaged in U.S. securities transactions. Notwithstanding this requirement, NPB chose to continue to service U.S. clients without disclosing their identity to the IRS. NPB’s view was that it could continue to accept and service U.S. account holders, even if it knew or had reason to believe they were engaged in tax evasion, so long as it complied with the QI Agreement, which in NPB’s view did not apply to account holders who were not trading in U.S.-based securities or to accounts that were nominally structured in the name of a non-U.S.-based entity. NPB formed this view without consulting legal counsel.
Between August 1, 2008 and December 31, 2015, NPB held a total of 353 U.S.-related accounts, which included both declared and undeclared accounts, with an aggregate peak year-end value of approximately $400 million in assets under management.
In approximately early 2009, NPB was approached by certain external asset managers who managed accounts on behalf of U.S. taxpayers and were seeking a replacement custodian bank for accounts for U.S. taxpayers that were being closed by other Swiss banks, including UBS AG. Some of these external asset managers and NPB discussed the long-term trend towards tax compliance in Switzerland and that eventually the external asset managers would only be able to manage accounts that were declared to the U.S. government. Those external asset managers told NPB that they were telling their clients to become tax compliant. However, the external asset managers also made clear to NPB that many of their clients who wished to onboard accounts at the Bank had not yet declared their accounts to the U.S. government. The external asset managers did not promise, and NPB did not require, that all accounts onboarded to NPB would become compliant within a specific period of time. In one instance, however, an external asset manager onboarded accounts from other Swiss banks that the Bank knew were undeclared with no discussion of tax compliance until 2011.
NPB viewed the taking of clients from other banks that were exiting U.S. taxpayers as a business opportunity. During a board of directors meeting held on March 9, 2009, the board unanimously resolved that it would allow U.S. taxpayers to open accounts at NPB, including customers who were forced to exit other banks. Prior to 2009, NPB had few U.S. clients. At the close of 2008, U.S. Related Accounts held approximately 8 million Swiss francs in assets. By the end of 2009, NPB had approximately 450 million Swiss francs under management in accounts owned or beneficially owned by U.S. taxpayers, an influx of approximately 442 million Swiss Francs. Approximately 69% of the U.S.-related assets held by the Bank at the end of 2009 were reported to the U.S. government by the account holder in or before the 2009 tax year.
NPB’s executives hoped that their U.S. customers would eventually fully declare their accounts and keep their money at the Bank after becoming compliant. However, NPB created no written or formal policies to encourage or mandate tax compliance and, in fact, continued to acquire and service non-compliant U.S. taxpayers.
According to NPB executives, beginning in August 2010, NPB decided not to open any new accounts for U.S. customers who were not tax-compliant. NPB did not memorialize this decision in any written policy nor in any executive board or management board meeting minutes. NPB knew in August 2010 that some of its existing U.S. customers were not tax-compliant, but continued to service those accounts.
Until at least August 2010, NPB did not require a Form W-9 from U.S. clients to open an account. NPB did not require the completion of Forms W-9 for existing U.S. customers until approximately summer of 2011.
NPB serviced some U.S. customers who structured their accounts so that they appeared as if they were held by a non-U.S. legal structure, such as an offshore corporation or trust, which aided and abetted the clients’ ability to conceal their undeclared accounts from the IRS. At least 89 of NPB’s U.S. Related Accounts, both declared and undeclared, were held in the name of offshore structures, including trusts or corporations purportedly domiciled in Panama, Liechtenstein, the British Virgin Islands, Hong Kong, and Belize. NPB never assisted customers in setting up such offshore structures. For accounts held in non-U.S. legal structures opened in 2009 and prior to Summer 2010, NPB did not require the signing of either a Form W-9 or Form W-8BEN.
NPB increased its efforts to obtain tax compliance from its U.S. customers in 2010 and 2011, but continued to service undeclared accounts. NPB first requested tax compliance evidence from its external asset managers for U.S. clients in August 2011. NPB serviced the declared and undeclared clients of two external asset managers after their respective indictments in the United States.
NPB has cooperated with the Department of Justice in this investigation, including by producing information relating to the U.S. taxpayer clients who maintained assets overseas, including the identities of the account holders and/or beneficial owners of more than 88% of assets, and by making multiple executives available for interview by the Department of Justice.
While U.S. accountholders at NPB who have not yet declared their accounts to the IRS may still be eligible to participate in the IRS Offshore Voluntary Disclosure Program, the price of such disclosure has increased. Most U.S. taxpayers who enter the IRS Offshore Voluntary Disclosure Program to resolve undeclared offshore accounts will pay a penalty equal to 27.5 percent of the high value of the accounts. On Aug. 4, 2014, the IRS increased the penalty to 50 percent if, at the time the taxpayer initiated their disclosure, either a foreign financial institution at which the taxpayer had an account or a facilitator who helped the taxpayer establish or maintain an offshore arrangement had been publicly identified as being under investigation, the recipient of a John Doe summons or cooperating with a government investigation, including the execution of a deferred prosecution agreement or non-prosecution agreement. With today’s announcement of this non-prosecution agreement, noncompliant U.S. accountholders at NPB must now pay that 50 percent penalty to the IRS if they wish to enter the IRS Offshore Voluntary Disclosure Program. The IRS recently announced that the Offshore Voluntary Disclosure Program will close on September 28, 2018.
“The non-prosecution agreement with NPB should signal that IRS CI continues its fight against offshore tax evasion,” said Don Fort, Chief IRS-Criminal Investigation. “The IRS devotes considerable resources in the U.S. and abroad to hold accountable those individuals and institutions that seek to cheat the U.S. tax system. I urge anyone not compliant with their tax obligations to consider the offshore voluntary disclosure program before it closes on September 28, 2018.”
Principal Assistant Attorney General Zuckerman of the Justice Department’s Tax Division thanked Senior Litigation Counsel Nanette Davis of the Tax Division and Assistant United States Attorneys Michelle Petersen and Patrick King of the U.S. Attorney’s Office for the Northern District of Illinois and IRS-Criminal Investigation, in particular IRS Special Agent Michael Leach, for their substantial assistance.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Insurance Salesman Who Embezzled His Client’s Inheritance Money Sentenced to Three Years in PrisonRead the Press Release
TRENTON, N.J. – An insurance salesman who was entrusted with managing his client’s inheritance was sentenced today to 36 months in prison for fraudulently using the funds for his own benefit, U.S. Attorney Craig Carpenito announced.
Patrick McCullagh, 70, of Georgetown, Kentucky, was previously convicted of an indictment charging him with one count of wire fraud. He was convicted following an eight-day trial before U.S. District Judge Mary L. Cooper, who imposed the sentence today in Trenton federal court.
According to documents filed in this case and the evidence at trial:
McCullagh was the principle of MidAtlantic Regional Services Inc., a purported insurance company located in Bordentown, New Jersey. In 2001, the victim entrusted McCullagh with money that the victim had inherited from his mother after her death. McCullagh falsely told the victim that he would use the funds to invest in a manner that would preserve the principle while paying the victim back in interest.
Instead, McCullagh pocketed some of the funds directly and forged withdrawal requests so he could loot money from the victim’s investment accounts. In order to deceive the victim, McCullagh also had the victim’s account statements diverted from the victim’s address.
In addition, the “interest” payments that McCullagh paid the victim on a monthly basis were actually funds McCullagh had siphoned from the investment accounts’ principle balance. McCullagh even fraudulently told the victim that some of the investments were tied-up in legal disputes surrounding a Kentucky property and that he needed money for legal fees, which the victim later provided. Altogether, McCullagh defrauded the victim out of more than $100,000.
In addition to the prison term, Judge Cooper ordered McCullagh to serve one year of supervised release and pay restitution of $98,067.82.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge Gregory W. Ehrie in Newark, with the investigation.
The government is represented by Assistant U.S. Attorney Molly Lorber and Senior Litigation Counsel Joseph Gribko of the U.S. Attorney’s Office Criminal Division in Trenton.
Defense counsel: James Patton Esq., Livingston, New Jersey