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9 July 2018
Upper Peninsula Crystal Meth Dealers ImprisonedRead the Press Release
MARQUETTE, MICHIGAN — U.S. Attorney Andrew Birge announced today that several crystal methamphetamine dealers from the western part of the Upper Peninsula received long prison terms. The Honorable Paul L. Maloney, U.S. District Judge, issued the following sentences:
• Patrick Joseph Sievers, age 36, formerly of Ironwood, Michigan, sentenced to 264 months (22 years) in federal prison, followed by 8 years of supervised release;
• Kathryn Maria Hellen, age 27, formerly of Ironwood, Michigan, sentenced to 120 months (10 years) in federal prison, followed by 5 years of supervised release;
• Jennifer Elizabeth Smith, age 29, formerly of Ontonagon, Michigan, sentenced to 46 months in federal prison, followed by 3 years of supervised release; and
• Dion Roy Jolliff, age 43, formerly of Ontonagon, Michigan, sentenced to 42 months in federal prison, followed by 3 years of supervised release.
During the sentencing, the government’s attorney, Assistant U.S. Attorney Maarten Vermaat, noted that the Upper Peninsula Substance Enforcement Team (UPSET) has seen crystal methamphetamine ("meth") – a very pure form of the drug – emerge as one of the most commonly trafficked illegal drugs in the area. In addition, the government said that crystal meth dealers are frequently arming themselves for protection.
This case was no exception. Evidence obtained by UPSET showed that Sievers started selling crystal meth in Gogebic, Ontonagon and Houghton Counties in 2016. By the time of his arrest in March 2017, he had sold, by conservative estimates, between 1.5 and 4.5 kilograms of the drug. When UPSET detectives executed a search warrant at Sievers’ camp in Ontonagon, MI on March 30, 2017, they found what Judge Maloney later described as a "drug bunker" – complete with firearms loaded and readily available, motion detectors guarding the approaches to the camp, hidden safes, and a video surveillance system monitoring the doors. Sievers was arrested that same day in Ironwood. Detectives searched his truck and found 215 grams (about 8 ounces) of highly pure crystal meth and a loaded Glock .40 caliber handgun.
Jennifer Smith was arrested after she sold crystal meth on Sievers’ behalf in Ontonagon.
After Sievers’ arrest, UPSET shifted its investigation to other meth dealers in the area. UPSET purchased meth from Dion Jolliff on several occasions. Then Jolliff was found asleep at the wheel of a van owned by Hellen in the middle of an intersection in Ontonagon. Meth and drug paraphernalia were found in the van. Jolliff was arrested.
Hellen, who was previously in a relationship with Sievers, was the last person arrested in this case. Despite her awareness of the arrests of Sievers, Smith and Jolliff, she continued selling crystal meth. In October 2017, police searched her rental house in Ontonagon and found another 8 ounces of crystal meth and a loaded .357 caliber handgun. She was arrested and admitted making several trips to Wausau, Wisconsin to obtain multiple ounces of crystal meth per trip.
Lieutenant Tim Sholander, the UPSET commander, noted that UPSET "was created to reduce the amount of dangerous drugs that destroy our communities in the Upper Peninsula." Lt. Sholander also noted that the detectives assigned to UPSET’s western U.P. team were working to ensure that crystal meth traffickers "were brought to justice for their part in flooding the western part of the Upper Peninsula with crystal meth."
Michigan State Police Troopers and law enforcement officers from the Gogebic Iron-Area Narcotics Team assisted the UPSET investigation. The U.S. Drug Enforcement Administration (DEA) forensic laboratory conducted analysis of the substances seized in this case. The case was prosecuted by Assistant U.S. Attorney Maarten Vermaat.
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U.S. Attorney to Open Human Trafficking Conference in ManhattanRead the Press Release
MANHATTAN, KAN. – U.S. Attorney Stephen McAllister will open the 2018 Human Trafficking Conference July 10 in Manhattan, Kan.
McAllister will speak at 8 a.m. Tuesday at the Manhattan Conference Center, 410 S. 3rd Street in Manhattan, to begin the two-day event. About 200 victim service providers, prosecutors, healthcare professionals, educators and law enforcement officers from across the state are registered to attend. The U.S. Attorney’s office is co-sponsoring the event with the Kansas Attorney General’s Office, the Riley County Attorney’s Office, the Kansas Law Enforcement Training Center and the Wichita State Midwest Criminal Justice Institute.
“What we all have in common is our desire to prevent human trafficking, to prosecute traffickers and to help survivors reclaim their lives and their freedom,” McAllister said.
The keynote speaker on Tuesday morning will be Peter Qualliotine of King County, Washington, where he is director of Men’s Accountability, Organization for Prostitution Services. He will describe his work with men who buy sex in a 10-week sex-buyer intervention program called Stopping Sexual Exploitation: A Program for Men.
In a presentation on the federal response to human trafficking, speakers from the Human Trafficking Unit of the Justice Department’s Civil Rights Division will discuss working with trafficking victims.
There is a $50 charge to attend and participants must register in advance. For more information, call Kim Reese at 316-617-2734.
U.S. Attorney Dunavant Announces Joseph “Joe” Murphy as First Assistant United States Attorney, Western District of TennesseeRead the Press Release
Memphis, TN – United States Attorney Dunavant is pleased to announce the appointment of Joseph "Joe" Murphy as First Assistant United States Attorney, Western District of Tennessee. This position was vacated when Lawrence J. Laurenzi retired in May 2018 after an extensive career with the Department of Justice.
Joe Murphy is a graduate of Lambuth College and the Cecil C. Humphreys School of Law at the University of Memphis. Since 1989 he has served as an Assistant United States Attorney in the Memphis office of the United States Attorney for the Western District of Tennessee. Murphy served as the office’s Criminal Chief, supervising 28 Assistant United States Attorneys who investigate and prosecute criminal cases in the Memphis office and 10 support staff. Prior to being named the office’s Criminal Chief in June of 2011, Murphy served as Chief of the office’s Organized Crime and Drug Enforcement Task Force for three years. In that position he was responsible for supervising a team of attorneys and support personnel who investigated and prosecuted violations of federal drug, money laundering, and firearms laws committed by both individuals and organized criminal groups. Between 1991 and 2007, Murphy served as a line assistant in both the office’s criminal division and drug task force.
U.S. Attorney D. Michael Dunavant said: "With over 29 years’ experience in the United States Attorney’s Office, including service as Criminal Division Chief and OCDETF Chief, Joe Murphy is well prepared to assume the duties of First Assistant United States Attorney. I am pleased to have Joe’s wise counsel, and I am confident that he will lead and manage the office with the highest degree of effectiveness and integrity. I look forward to continuing to work with him to pursue and carry out the priorities of the Department of Justice in the Western District of Tennessee."
During his career with the Justice Department Murphy has tried approximately 125 felony cases to verdict in U.S. District Court. These cases included prosecutions of health care professionals for illegally distributing controlled substances; mail and wire fraud cases; and theft cases involving pension funds and interstate shipments. Murphy has also represented the government in over 200 cases litigated before the United States Court of Appeals for the Sixth Circuit, and he has argued approximately 48 cases before that court.
A Memphis resident, Murphy has been married to Sandy Murphy for 29 years. He has two children, both of whom currently attend graduate school at the University of Memphis. Active in community and legal affairs, Murphy has served on the Executive Committees of the Tennessee Bar Association’s Criminal Justice and Environmental Law Sections, is a member of the Leo Bearman, Sr. Inn of the American Inns of Court, and has served as a volunteer with the Chickasaw Council of the Boy Scouts of America.
Two Juneau Men Sentenced for Federal Firearms OffensesRead the Press Release
Anchorage, Alaska – U.S. Attorney Bryan Schroder announced that on Friday, July 6, 2018, two Juneau men were sentenced in federal court, in separate cases, for federal firearms offenses.
James V. Drury, 50, of Juneau, was sentenced to serve 72 months in prison, followed by three years of supervised release for theft of firearms and for illegally possessing firearms as a convicted felon. Drury has previous felony convictions with the State of Alaska for burglary and attempted burglary.
According to court documents, Drury burglarized a residence in Ketchikan on May 3, 2016, where he stole two of the homeowner’s firearms – a Model 59/66, 7.62x39 caliber rifle and a Savage Arms, Model 188H, .22 caliber rifle. During the burglary, the homeowner had entered the residence and encountered Drury in possession of the two firearms. During that confrontation, Drury raised one of the rifles, pointed it at the homeowner, and directed him not to move. The homeowner fled the residence to contact police. Drury attempted to conceal the firearms in the backyard of another residence, which were found by the residence owner 11 days later.
Christopher W. Davison, 34, of Juneau, was sentenced to serve 90 months in prison, followed by three years of supervised release for illegally possessing firearms as a convicted felon. Davison has previous felony convictions with the State of Alaska for vehicle theft, criminal mischief, and riot.
According to court documents, on April 20, 2017, law enforcement officers received a report of a man “tweaking hard” and stating to an individual that he “was going to kill everybody” and to remember his name “Chris Davison.” It was reported that Davison was in possession of a firearm described as a sawed-off shotgun. After that incident, a police officer spoke with another witness who stated that he was awoken in the morning and confronted by Davison with what he described as a “MAC-10,” asking the witness to leave the room so he could use the room to have sex with a woman. The next day, Davison was observed at a woman’s residence, but ended up eluding police. Upon Davison’s subsequent arrest, a search of the residence revealed ammunition and a stolen firearm that was a 10/22 Ruger, which is classified as pistol.
The Juneau Police Department (JPD), the Alaska State Troopers (AST), and the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) conducted the investigations leading to the successful prosecutions of these cases. These cases were prosecuted by Assistant U.S. Attorney Jack Schmidt.
Two Defendants Arrested for Distribution of Controlled Substances Through Sham Internet PharmacyRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, Valerie Nickerson, the Special Agent in Charge of the New Jersey Office of the Drug Enforcement Administration (“DEA”), and Judy Ramos, the Acting Inspector in Charge of the New Jersey Office of the United States Postal Inspection Service (“USPIS”), announced today that EVELIN BRACY and JORGE RODRIGUEZ LOPEZ were arrested and charged in Manhattan federal court with conspiracy to distribute controlled substances, including oxycodone, hydrocodone, and more than 40 grams of the fentanyl analogue U-47700, distribution of controlled substances over the Internet, and conspiracy to commit money laundering, in connection with a large-scale drug distribution operation purporting to be an online pharmacy. BRACY and RODRIGUEZ LOPEZ were both arrested this morning. Both defendants will be presented today before U.S. Magistrate Judge Sarah Netburn.
Manhattan U.S. Attorney Geoffrey S. Berman said: “As alleged, Evelin Bracy and Jorge Rodriguez Lopez distributed controlled substances to individuals throughout the United States as part of a drug trafficking organization that sold pharmaceuticals through a website purporting to be an online pharmacy. Bracy and Rodriguez Lopez allegedly conspired to distribute oxycodone, hydrocodone, and a fentanyl analogue, and laundered hundreds of thousands of dollars in narcotics trafficking proceeds. Thanks to the outstanding investigative work of the DEA and USPIS, these two defendants are now facing prosecution.”
DEA Special Agent in Charge Valerie Nickerson said: “The two individuals arrested allegedly have been distributing powerful narcotics not just in New Jersey, but across the United States, based on orders place through a supposed online pharmacy. This very profitable, alleged illegal endeavor has come to an end thanks to the hard work of the men and women of the DEA and the USPIS. Whether on a street corner or in cyberspace we will continue to pursue those pushing these drugs in our communities.”
USPIS Acting Inspector in Charge Judy Ramos said: “Postal Inspectors, federal prosecutors and our law enforcement partners have diligently worked to identify and disrupt the activities of an online pharmacy suspected of peddling illegal pills and money laundering. Postal Inspectors will continue to tirelessly investigate these types of crimes that utilize the U.S. Postal Service to facilitate illicit transactions.”
According to the allegations in the Complaint[[1]] unsealed today in Manhattan federal court:
Law enforcement agents began investigating an online pharmacy website (the “Pharmacy Website”) following an overdose death of a victim in Boise, Idaho, on or about March 17, 2017, whose death was caused by elevated levels of multiple prescription opioids as well as fentanyl. The victim’s computer showed that he had repeatedly ordered painkillers from the Pharmacy Website, and that he had wired thousands of dollars to a bank account in connection with these purchases. Law enforcement subsequently discovered that this bank account was being used by BRACY and RODRIGUEZ LOPEZ. Bank records show that this bank account and several others used by BRACY have received over $750,000 in apparent narcotics proceeds, and that BRACY and RODRIGUEZ LOPEZ have withdrawn hundreds of thousands of dollars in cash from these accounts, and have also used these bank accounts to pay for costs associated with the drug distribution operation, including the costs of shipping controlled substances.
In the course of the investigation, undercover law enforcement agents conducted multiple purchases of controlled substances from the Pharmacy Website, and received instructions to send payment for these drugs to BRACY and RODRIGUEZ LOPEZ. The substances purchased by undercover law enforcement agents included substances that tested positive for oxycodone and hydrocodone.
The investigation has revealed that in some cases customers purchased what they believed to be prescription drugs such as alprazolam or oxycodone from the Pharmacy Website, but instead received pills containing other substances. In the course of the investigation, law enforcement agents seized a package that had been sent to RODRIGUEZ LOPEZ, and recovered over 200 pills weighing over 40 grams. These pills tested positive for U-47700, which is a fentanyl analogue listed on Schedule I.
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BRACY, 34, and RODRIGUEZ LOPEZ, 32, who both reside in New Brunswick, New Jersey, have each been charged with one count of conspiracy to distribute controlled substances including at least 40 grams of the fentanyl analogue U-47700, which carries a maximum sentence of 40 years in prison and a mandatory minimum sentence of five years in prison, one count of distribution of controlled substances over the Internet, which carries a maximum sentence of 40 years in prison and a mandatory minimum sentence of five years in prison, and one count of conspiracy to commit money laundering, which carries a maximum sentence of 20 years in prison. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.
Mr. Berman praised the investigative work of the DEA and USPIS in this investigation. He added that the investigation is continuing.
This case is being handled by the Office’s Narcotics Unit. Assistant U.S. Attorney Thane Rehn is in charge of the prosecution.
The charges contained in the Complaint are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations, and every fact described should be treated as an allegation.
Two Additional Members and Associates of Tennessee Mongols Motorcycle Gang Charged with Crimes Related to Racketeering Conspiracy, Murder, Kidnapping and Drug TraffickingRead the Press Release
A 75-count, third-superseding indictment was returned by a federal grand jury in Nashville, Tennessee on June 29 and unsealed Friday, charging 21 members and associates of the Clarksville, Tennessee chapter of the Mongols Motorcycle Gang with various federal crimes, including racketeering conspiracy, murder in aid of racketeering, attempted murder, kidnapping, robbery, large-scale drug trafficking, and other crimes, announced Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division and U.S. Attorney Don Cochran of the Middle District of Tennessee.
On Jan. 18, a 54-count superseding indictment charged 15 members and associates of the Clarksville Mongols with racketeering conspiracy, murder, drug trafficking and other related crimes. On March 7, a 64-count second-superseding indictment charged four additional defendants with the kidnapping and murder of Stephen Cole, an estranged former member of the Mongols. The indictments detail allegations of violent, criminal activity and drug trafficking in and around the Clarksville area beginning in or about March 2015 and continuing until the return of the indictments.
The latest indictment charges two additional associates of the Clarksville Mongols with drug trafficking conspiracy, money laundering, interstate travel in aid of racketeering, tampering with the grand jury investigation by removing and concealing evidence, false statements to law enforcement, and accessory after the fact for the kidnapping and murder of Stephen Cole. The two additional defendants are Janie Lee, 22, of Owensboro, Kentucky, and Jessie Marie Decker, 33, of Trenton, Kentucky. Lee will have her initial court appearance this afternoon before U.S. Magistrate Judge H. Brent Brennenstuhl in the Western District of Kentucky and Decker will have her initial court appearance this afternoon before U.S. Magistrate Judge Alistair E. Newbern in the Middle District of Tennessee.
This indictment charges Lee with conspiracy to distribute large-scale quantities of methamphetamine, distribution and possession with intent to distribute methamphetamine, interstate travel in aid of racketeering, and money laundering.
Decker is charged along with previously-indicted defendant William Nelper aka “Flip,” 50, of Clarksville, with conspiracy to distribute and possession with intent to distribute marijuana, tampering with the grand jury investigation, and use of a firearm in relation to a drug trafficking crime. Decker is separately charged with making false statements to law enforcement relating to the kidnapping and murder of Cole and as an accessory after the fact to the kidnapping.
The third-superseding indictment also brings additional charges against other previously- indicted defendants. Robert Humiston aka “Bric,” 25, of Dover, is charged with possession of a short-barreled rifle in violation of the National Firearms Act (NFA) and with failure to register the firearm as required by the NFA. Christopher Wilson, 35, of Clarksville, is charged with two counts of being a felon in possession of a firearm, drug trafficking conspiracy and possession with intent to distribute several different controlled substances, possession with intent to distribute methamphetamine, and possession of a firearm in furtherance of a drug trafficking crime.
This case is being investigated by the Bureau of Alcohol, Tobacco, Firearms & Explosives; the Clarksville Police Department; the Tennessee Bureau of Investigation; and the Kentucky State Police. Trial Attorney Robert Tully of the Criminal Division’s Organized Crime and Gang Section and Assistant U.S. Attorney Katy Risinger of the Middle District of Tennessee are prosecuting the case.
An indictment is merely an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Two Additional Members and Associates of Clarksville Tennessee Mongols Motorcycle Gang Charged with Crimes Related to Racketeering Conspiracy, Murder, Kidnapping and Drug TraffickingRead the Press Release
A 75-count, third-superseding indictment was returned by a federal grand jury in Nashville, Tennessee on June 29 and unsealed Friday, charging 21 members and associates of the Clarksville, Tennessee chapter of the Mongols Motorcycle Gang with various federal crimes, including racketeering conspiracy, murder in aid of racketeering, attempted murder, kidnapping, robbery, large-scale drug trafficking, and other crimes, announced U.S. Attorney Don Cochran of the Middle District of Tennessee and Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division.
On January 18, 2018, a 54-count superseding indictment charged 15 members and associates of the Clarksville Mongols with racketeering conspiracy, murder, drug trafficking and other related crimes. On March 7, 2018, a 64-count second-superseding indictment charged four additional defendants with the kidnapping and murder of Stephen Cole, an estranged former member of the Mongols. The indictments detail allegations of violent, criminal activity and drug trafficking in and around the Clarksville, Tennessee area beginning in or about March 2015 and continuing until the return of the indictments.
The latest indictment charges two additional associates of the Clarksville Mongols with drug trafficking conspiracy, money laundering, interstate travel in aid of racketeering, tampering with the grand jury investigation by removing and concealing evidence, false statements to law enforcement, and accessory after the fact for the kidnapping and murder of Stephen Cole. The two additional defendants are:
Janie Lee, 22, of Owensboro, Kentucky, and Jessie Marie Decker, 33, of Trenton, Kentucky. Lee will have her initial court appearance this afternoon before U.S. Magistrate Judge H. Brent Brennenstuhl in the Western District of Kentucky and Decker will have her initial court appearance this afternoon before U.S. Magistrate Judge Alistair E. Newbern in the Middle District of Tennessee.
This indictment charges Lee with conspiracy to distribute large-scale quantities of methamphetamine, distribution and possession with intent to distribute methamphetamine, interstate travel in aid of racketeering, and money laundering.
Decker is charged along with previously-indicted defendant William Nelper a/k/a “Flip,” with conspiracy to distribute and possession with intent to distribute marijuana, tampering with the grand jury investigation, and use of a firearm in relation to a drug trafficking crime. Decker is separately charged with making false statements to law enforcement relating to the kidnapping and murder of Cole and as an accessory after the fact to the kidnapping.
The third-superseding indictment also brings additional charges against other previously- indicted defendants. Robert Humiston a/k/a “Bric,” is charged with possession of a short-barreled rifle in violation of the National Firearms Act (NFA) and with failure to register the firearm as required by the NFA. Christopher Wilson is charged with two counts of being a felon in possession of a firearm, drug trafficking conspiracy and possession with intent to distribute several different controlled substances, possession with intent to distribute methamphetamine, and use of a firearm in relation to a drug trafficking crime.
This case is being investigated by the Bureau of Alcohol, Tobacco, Firearms & Explosives; the Clarksville Police Department; the Tennessee Bureau of Investigation; and the Kentucky State Police. Assistant U.S. Attorney Katy Risinger of the Middle District of Tennessee and Trial Attorney Robert Tully of the DOJ Organized Crime and Gang Section are prosecuting the case.
An indictment is merely an accusation and all defendants are presumed innocent unless and until proven guilty in a court of law.
Timothy Downs, Former Chief of Lake County Sheriff’s Department and William Szarmach, Owner of CSA Towing SentencedRead the Press Release
HAMMOND – Timothy Downs, 67, of Monticello, Indiana and William Szarmach, 61, of Hobart, Indiana were sentenced before District Court Judge James T. Moody on their plea of guilty to honest services wire fraud, announced U.S. Attorney Kirsch.
U.S. Attorney Kirsch said, “Public corruption is a top priority of my office. Mr. Downs and Mr. Szarmach’s immediate cooperation was instrumental in the prosecution of former Sheriff John Buncich and the court’s sentence reflects these acts. For those involved in public corruption, my office has a team of investigators that are working on investigating all leads related to all acts of public corruption. I encourage anyone with information about such possible corruption to report it to me or to the FBI. Citizens demand, and in fact deserve, honest public service from their elected and appointed officials.”
Downs was sentenced to 2 years probation and ordered to pay a fine of $6000.
Szarmach, who in addition to honest services wire fraud also entered a plea of guilty to bribery, was also sentenced to 2 years probation and ordered to pay restitution to the IRS.
According to documents in this case, from February 2014 continuing into October 2016, Buncich, Downs and Szarmach devised a scheme to deprive the citizens of Lake County of their right to the honest services of the sheriff’s office. The scheme was designed to enrich Buncich personally and his campaign committee, known as Buncich Boosters. The documents detail a number of checks and cash payments, often collected by Downs, from Szarmach and an Individual A in exchange for Buncich awarding county towing business and towing in the City of Gary for ordinance violations. Individual A is the owner of a tow truck business who voluntarily came forward and cooperated with the United States during the course of this investigation.
This case was being investigated by the Federal Bureau of Investigation; the Internal Revenue Service, Criminal Investigation Division; and the Department of Labor, Office of Inspector General. This case will be handled by Assistant U.S. Attorney Philip C. Benson.
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South Bend Woman Sentenced to 60 Months in PrisonRead the Press Release
SOUTH BEND – Tiffany Gadson, age 34, of South Bend, Indiana was sentenced before District Court Judge Robert L. Miller, Jr. for possessing cocaine with the intent to deliver, announced U.S. Attorney Kirsch.
Gadson was sentenced to 60 months in prison followed by 4 years of supervised release.
According to documents in this case, on or about November 13, 2017 officers conducted a traffic stop on Gadson who was in possession over 28 grams of a rocklike substance that contained a cocaine base.
This case was investigated by the Drug Enforcement Administration (DEA) with assistance from the Michigan City Police Department and LaPorte County Drug Task Force. The case was handled by Assistant U.S. Attorney Frank Schaffer.
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Solano County Woman Sentenced to over 2 Years in Prison for Conspiracy and Aggravated Identity TheftRead the Press Release
SACRAMENTO, Calif. — Michelle Louise Travis, 53, of Suisun City, was sentenced today by U.S. District Judge Kimberly J. Mueller to two years and three months in prison for conspiracy to commit wire fraud and aggravated identity theft, U.S. Attorney McGregor W. Scott announced.
According to court documents, in 2013, Travis and co-defendant Pamela Dawn Pierson used identity theft victims’ personal identifying information to file fraudulent tax returns in order to obtain income tax refunds to which they were not entitled. As part of their scheme, Travis and Pierson obtained and shared lists of personal identifying information, which included identity theft victims’ names and social security numbers. Travis and Pierson submitted a total of $66,022 in fraudulent claims to the Internal Revenue Service.
This case was the product of an investigation by the IRS Criminal Investigation, the Federal Bureau of Investigation, and the Fairfield Police Department. Assistant U.S. Attorney Brian A. Fogerty prosecuted the case.
On March 14, 2018, Judge Mueller sentenced Pierson to two years and three months in prison.
Settlement to Speed Cleanup at Superfund Fund Site AnnouncedRead the Press Release
WASHINGTON – The U.S. Department of Justice, the U.S. Environmental Protection Agency (EPA), and the Rhode Island Department of Environmental Management (RIDEM) announced today that two subsidiaries of Stanley Black & Decker Inc.—Emhart Industries Inc. and Black & Decker Inc.—have agreed to clean up dioxin contaminated sediment and soil at the Centredale Manor Restoration Project Superfund Site in North Providence and Johnston, Rhode Island.
“We are pleased to reach a resolution through collaborative work with the responsible parties, EPA, and other stakeholders,” said Acting Assistant Attorney General Jeffrey H. Wood for the Justice Department’s Environment and Natural Resources Division. “Today’s settlement ends protracted litigation and allows for important work to get underway to restore a healthy environment for citizens living in and around the Centredale Manor Site and the Woonasquatucket River.”
“This settlement demonstrates the tremendous progress we are achieving working with responsible parties, states, and our federal partners to expedite sites through the entire Superfund remediation process,” said EPA Acting Administrator Andrew Wheeler. “The Centredale Manor Site has been on the National Priorities List for 18 years; we are taking charge and ensuring the Agency makes good on its promise to clean it up for the betterment of the environment and those communities affected.”
“Successfully concluding this settlement paves the way for EPA to make good on our commitment to aggressively pursue cleaning up the Centredale Manor Superfund Site,” said EPA New England Regional Administrator Alexandra Dunn. “We are excited to get to work on the cleanup at this site, and get it closer to the goal of being fully utilized by the North Providence and Johnston communities.”
“We are pleased that the collective efforts of the State of Rhode Island, EPA, and DOJ in these negotiations have concluded in this major milestone toward the cleanup of the Centredale Manor Restoration Superfund site and are consistent with our long-standing efforts to make the polluter pay,” said RIDEM Director Janet Coit. “The settlement will speed up a remedy that protects public health and the river environment, and moves us closer to the day that we can reclaim recreational uses of this beautiful river resource.”
The settlement, which includes cleanup work in the Woonasquatucket River (River) and bordering residential and commercial properties along the River, requires the companies to perform the remedy selected by EPA for the Site in 2012, which is estimated to cost approximately $100 million, and resolves longstanding litigation.
The cleanup remedy includes excavation of contaminated sediment and floodplain soil from the Woonasquatucket River, including from adjacent residential properties. Once the cleanup remedy is completed, full access to the Woonasquatucket River should be restored for local citizens. The cleanup will be a step toward the State’s goal of a fishable and swimmable river. The work will also include upgrading caps over contaminated soil in the peninsula area of the Site that currently house two high-rise apartment buildings. The settlement also ensures that the long-term monitoring and maintenance of the site, as directed in the remedy, will be implemented to ensure that public health is protected.
Under the settlement, Emhart and Black & Decker will reimburse EPA for approximately $42 million in past costs incurred at the Site. The companies will also reimburse EPA and the State of Rhode Island for future costs incurred by those agencies in overseeing the work required by the settlement. The settlement will also include payments on behalf of two federal agencies to resolve claims against those agencies. These payments, along with prior settlements related to the Site, will result in a 100 percent recovery for the United States of its past and future response costs related to the Site.
Litigation related to the Site has been ongoing for nearly eight years. While the Federal District Court found Black & Decker and Emhart to be liable for their hazardous waste and responsible to conduct the cleanup of the Site, it had also ruled that EPA needed to reconsider certain aspects of that cleanup. EPA appealed the decision requiring it to reconsider aspects of the cleanup. This settlement, once entered by the District Court, will resolve the litigation between the United States, Rhode Island, and Emhart and Black and Decker, allowing the cleanup of the Site to begin.
The Site spans a one and a half mile stretch of the Woonasquatucket River and encompasses a nine-acre peninsula, two ponds and a significant forested wetland. From the 1940s to the early 1970s, Emhart’s predecessor operated a chemical manufacturing facility on the peninsula and used a raw material that was contaminated with 2,3,7,8-tetrachlorodibenzo-p-dioxin, a toxic form of dioxin. The Site property was also previously used by a barrel refurbisher. Elevated levels of dioxins and other contaminants have been detected in soil, groundwater, sediment, surface water and fish.
The Site was added to the National Priorities List (NPL) in 2000, and in December 2017, EPA included the Centredale Manor Restoration Project Superfund Site on a list of Superfund sites targeted for immediate and intense attention. Several short-term actions were previously performed at the Site to address immediate threats to the residents and minimize potential erosion and downstream transport of contaminated soil and sediment. This settlement is the latest agreement EPA has reached since the Site was listed on the NPL. Prior agreements addressed the performance and recovery of costs for the past environmental investigations and interim cleanup actions from Emhart, the barrel reconditioning company, the current owners of the peninsula portion of the Site, and other potentially responsible parties.
The Consent Decree, lodged in the U.S. District Court of Rhode Island, will be posted in the Federal Register and available for public comment for a period of 30 days. The Consent Decree can be viewed on the Justice Department website: www.justice.gov/enrd/Consent_Decrees.html.
EPA information on the Centredale Manor Superfund Site: www.epa.gov/superfund/centredale.
Schenectady Man Sentenced to 63 Months of Imprisonment for ArsonRead the Press Release
ALBANY, NEW YORK – Duane E. Griffin, 37, of Schenectady, New York, was sentenced to serve 63 months in prison for arson, announced United States Attorney Grant C. Jaquith and Ashan M. Benedict, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF)-New York Field Division.
On March 9, 2018, following a one-week trial, a jury voted to convict Griffin of arson. The evidence presented at trial established that on March 17, 2012, Griffin used a hand-held propane torch to set the three-story building, located at 605 Union Street in the City of Schenectady, on fire. Griffin then got into his vehicle and fled the scene as flames began to engulf the building. The fire caused such severe structural damage to the building that it later had to be torn down for public safety. Griffin was also sentenced to a three-year term of supervised release, which will start after he is released from prison.
This case was investigated by the United States Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and the Schenectady Fire Department, and was prosecuted by Assistant U.S. Attorney Rick Belliss.
Roane County Man Pleads Guilty to Child Pornography CrimeRead the Press Release
CHARLESTON, W.Va. – A Roane County man pled guilty today to a child pornography crime, announced United States Attorney Mike Stuart. Devin Wolfe entered his guilty plea to one count of receipt of child pornography. Stuart commended the investigation conducted by the Federal Bureau of Investigation and the West Virginia State Police.
“Prosecuting child pornography crimes is a priority for my office,” said United States Attorney Mike Stuart. “We will continue to work with law enforcement to protect our most vulnerable by vigorously prosecuting pedophiles who prey on children.”
Wolfe admitted to possessing images and videos depicting child pornography on October 12, 2016. He received these images and videos from the internet, including from the website “4chan.” One of the images, which he downloaded on August 21, 2016 at his residence in Roane County, depicted an adult male engaged in sexual intercourse with a prepubescent female. Wolfe further admitted to possessing at least 6 videos and 730 images. Many of the minors depicted in the videos and images have been identified by the National Center for Missing and Exploited Children.
Wolfe faces at least 5 and up to 20 years in federal prison when he is sentenced on October 10, 2018. He will also be required to register as a sex offender.
Assistant United States Attorneys Jennifer Rada Herrald and Emily Wasserman are handling the prosecution. The plea hearing was held before United States District Judge John T. Copenhaver, Jr.
This case was prosecuted as part of Project Safe Childhood, a nationwide initiative of the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorney’s 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 those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
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Plattsburgh Drug Dealer Sentenced for Membership in Heroin Distribution ConspiracyRead the Press Release
PLATTSBURGH, NEW YORK – Charles Adams, a.k.a. “Chuck,” 32, of Peru, New York, was sentenced today to serve 37 months in prison, to be followed by 4 years of supervised release, for conspiring to possess with intent to distribute and to distribute heroin, announced United States Attorney Grant C. Jaquith, Special Agent in Charge James J. Hunt, New York Division, U.S. Drug Enforcement Administration (DEA), and Clinton County Sheriff David Favro.
In pleading guilty, Adams admitted to being a member of a heroin-distribution conspiracy that transported hundreds of grams of heroin from Annapolis, Maryland and Schenectady, New York, to Plattsburgh, New York, where it was distributed. Adams, who was arrested in possession of 24 grams of heroin (including packaging) on May 25, 2017, admitted to driving other members of the conspiracy to pick up heroin in Annapolis and Schenectady, and to selling heroin in Plattsburgh.
The charges are the result of a nearly yearlong investigation led by the DEA Task Force in Plattsburgh, which consists of law enforcement officers from the DEA, Homeland Security Investigations, United States Border Patrol, New York State Police, Clinton County Sherriff’s Office, Essex County Sheriff’s Office, and the Plattsburgh Police Department. The New York State Department of Corrections and Community Supervision also assisted in the investigation.
The case was prosecuted by Assistant U.S. Attorneys Cyrus P.W. Rieck and Katherine Kopita.
Pensacola Man Pleads Guilty to Stealing from the Department of Veterans AffairsRead the Press Release
PENSACOLA, FLORIDA – Richard E. Kohl, 83, of Pensacola, Florida, has pleaded guilty to theft of government funds in connection with filing false and fraudulent benefit claims with the Department of Veterans Affairs (“VA”). The guilty plea was announced by Christopher P. Canova, United States Attorney for the Northern District of Florida.
Documents introduced at the time of the guilty plea reflect that, at some point prior to July 3, 1996, Kohl created and signed a fictitious Form DD-214 that falsely reported that he served in the United States Marine Corps during the Korean War and was discharged on December 20, 1961. Kohl never served in any branch of the United States military. Kohl used the false Form DD-214 as proof of his military service to obtain veterans’ benefits he was not entitled to receive. Between February 3, 2005, and February 9, 2018, Kohl received benefit payments and services totaling approximately $219,719.39 from the VA.
“By defrauding the federal government for personal gain, Kohl stole resources needed to help real veterans,” said U.S. Attorney Canova. “These benefits are meant for the brave men and women who have served our country.”
Monty Stokes, Special Agent in Charge, VA Office of Inspector General said, “The VA benefits fraudulently received by Mr. Kohl were intended to provide financial and health care support for veterans who honorably served in the armed forces of the United States. This guilty plea is the result of the successful investigative and prosecutive efforts of the VA OIG and the U.S. Attorney’s Office. These continued efforts safeguard the integrity of VA programs, and ensure that VA benefits are provided only to those who have earned them.”
Kohl faces a maximum of ten years in prison. The sentencing hearing is scheduled for September 19, 2018.
The case was investigated by the VA Office of Inspector General – Criminal Investigations Division. It was prosecuted by Assistant United States Attorney J. Ryan Love.
The United States Attorney's Office for the Northern District of Florida is one of 94 offices that serve as the nation’s principal litigators under the direction of the Attorney General. To access public court documents online, please visit the U.S. District Court for the Northern District of Florida website. For more information about the United States Attorney’s Office, Northern District of Florida, visit http://www.justice.gov/usao/fln/index.html.
Owner of Salem Roast Beef Restaurant Pleads Guilty to Federal Tax ChargesRead the Press Release
BOSTON – The owner of King’s Roast Beef in Salem pleaded guilty today in federal court in Boston to failing to pay approximately $383,000 in taxes.
John Kalantzis, 52, of Lynn, pleaded guilty to two counts of aiding and assisting in filing a false tax return. U.S. District Court Judge William G. Young scheduled sentencing for Oct. 2, 2018.
During tax years 2011 through 2015, Kalantzis underreported the gross receipts and expenses of King’s Roast Beef in order to improperly reduce the federal income taxes owed by the restaurant. Kalantzis did so by diverting some of the restaurant’s cash receipts to himself, paying for some of the restaurant supplies with cash, and paying a portion of his employee’s wages in cash. Kalantzis then failed to report this conduct to his tax preparer. As such, during each of the tax years 2011 through 2015, Kalantzis failed to report cash receipts of approximately $275,000 and cash expenses of approximately $115,000 on King’s Roast Beef’s tax returns. As a result, Kalantzis failed to report a total of $855,000 to the IRS during those years, thereby avoiding paying corporate and personal taxes of $383,000.
The charge of aiding and assisting the filing of false tax returns provides for a sentence of no greater than three years in prison, one year of supervised release and a fine of $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling and Kristina O’Connell, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigations in Boston, made the announcement. Assistant U.S. Attorney Mark J. Balthazard of Lelling’s Economic Crimes Unit is prosecuting the case.
Oklahoma City Woman Receives a Year in Prison for Use of Credit Profile NumbersRead the Press Release
OKLAHOMA CITY – TIMATRESS TENAKA CADE, 31, of Oklahoma City, has been sentenced to twelve months in prison for using credit profile numbers, or CPNs, to falsely report her Social Security Number in credit applications, announced Robert J. Troester, Acting U.S. Attorney for the Western District of Oklahoma.
According to charges filed in November 2017, Cade used CPNs, also known as "credit privacy numbers" or "credit protection numbers," instead of her own Social Security Number when she applied for financing at retailers and financial institutions. CPNs are usually stolen Social Security Numbers, often belonging to children, which are marketed to individuals with poor credit history as a way to get a clean credit profile. By using CPNs instead of her own Social Security Number on credit applications, Cade deceived retailers, credit card companies, banks, and a home leasing company into believing she had a better credit history than she had actually earned. She purchased a vehicle, household furnishings, televisions, computers, and other goods, and leased a home, and then made little to no payments on the credit accounts, which caused financial losses to her creditors.
On January 5, 2018, Cade pleaded guilty to false representation of a Social Security Number after she used a CPN instead of her own Social Security Number when she leased a home in Edmond, Oklahoma, from OKC Homes 4 You. Today U.S. District Judge David L. Russell sentenced her to twelve months in prison, to be followed by three years of supervised release. She must also pay $68,637.74 in restitution to OKC Homes 4 You and the other creditors she defrauded. The government agreed to dismiss other charges against her.
This case is the result of an investigation by the Social Security Administration’s Office of the Inspector General, the Federal Bureau of Investigation, and the United States Postal Inspection Service. It was prosecuted by Assistant U.S. Attorney Jessica L. Perry.
Reference is made to public filings for further information.
Odemnis Prats Leiva Sentenced to Serve 54 Months in Federal Prison for Wire Fraud and Aggravated Identity TheftRead the Press Release
GREENEVILLE, Tenn. – On July 9, 2018, Odemnis Prats Leiva, 31, of Pompano Beach, Florida, was sentenced by the Honorable J. Ronnie Greer, U.S. District Judge, to serve 54 months in federal prison for his role in a wire fraud and aggravated identity theft conspiracy involving credit card skimmers. Upon his release from prison, he will be supervised by U.S. Probation for three years. Leiva was also ordered to pay restitution in the amount of $21,114.84.
In March 2018, Leiva pleaded guilty to three counts of a September 2017 federal indictment. Details of the scheme are outlined in his plea agreement on file with U.S. District Court. According to the plea agreement, between August 7, 2017 and August 10, 2017, Leiva and Amaurys Mendez Campanon used skimming devices on gas pumps at retail gas stations to obtain the credit/debit card account information of numerous people without their knowledge. They used the fraudulently obtained information to re-encode unloaded gift cards, which they shoplifted from various retail establishments. The re-encoded cards were then used to purchase loaded gift cards and other consumer items at various retail establishments across east Tennessee and elsewhere.
As a result of an ongoing investigation by law enforcement, Leiva and Campanon were arrested in Rogersville, Tennessee, on August 10, 2017. At the time of the arrest, Leiva was in possession of nine unlawfully re-encoded devices, $7,020.25 in cash, numerous gift cards, all of which he had obtained as part of the conspiracy, as well as other items used in furtherance of their conspiracy. Campanon, who was also charged in the indictment and has pleaded guilty, was arrested at the same time. He is awaiting sentencing in U.S. District Court.
This investigation was conducted by the U.S. Secret Service, Johnson City Police Department and Rogersville Police Department. Assistant U.S. Attorney TJ Harker represented the United States in court proceedings.
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New Orleans Man Pleads Guilty in Methamphetamine Trafficking ConspiracyRead the Press Release
NEW ORLEANS – U.S. Attorney Duane A. Evans announced that PETER GIANDALONE, age 43, of New Orleans pled guilty today to one count of conspiring to traffic 500 grams or more of a mixture containing methamphetamine in the Eastern District of Louisiana. GIANDALONE faces a mandatory minimum sentence of 10 years in prison, a maximum life sentence, a fine of up to $10,000,000 and at least 5 years of supervised release.
U.S. District Judge Susie Morgan set sentencing for GIANDALONE on October 11, 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.
Minnesota Man Charged with Kidnapping Kansas GirlRead the Press Release
KANSAS CITY, KAN. – A Minnesota man was charged Monday with kidnapping a 13-year-old Kansas girl and taking her to St. Paul, U.S. Attorney Stephen McAllister said.
Dechon White, 23, St. Paul, Minn., is charged with one count of kidnapping. Documents filed in the case allege White and the victim met online in February 2018. On July 1, White came to visit the victim at her home in Lenexa, Kan. He told the victim’s mother he was 16 years old. During his stay in Lenexa, he had sex with the victim.
On July 4, White and the victim told her mother they were going to a shopping mall. Instead, they went to a Greyhound bus station in Kansas City and took a bus to St. Paul.
After the victim’s mother reported her missing, police found White and the victim at his residence in St. Paul.
If convicted, White faces a penalty of not less than 20 years in federal prison and a fine up to $250,000. The Lenexa Police Department, the South St. Paul Police Department and the FBI investigated. Assistant U.S. Attorneys Kim Flannigan and David Zabel are prosecuting.
In all cases, defendants are presumed innocent until and unless proven guilty. The indictments merely contain allegations of criminal conduct.
Mexican Man Arrested at the Cyril E. King Airport Sentenced to Incarceration for Illegal Reentry into the United StatesRead the Press Release
St. Thomas, USVI – FilibertoMoreno, 50, of Mexico, was sentenced today before District Court Judge Curtis V. Gomez, to four months incarceration for illegal reentry into the United States, United States Attorney Gretchen C.F. Shappert announced. In addition, Judge Gomez sentenced Moreno to one year of supervised release and ordered him to pay a $100 special assessment.
According to plea agreement, Moreno was stopped by U.S. Customs and Border Protection (CBP) officers at the Cyril E. King Airport after he presented himself at primary inspection. During the inspection process, Customs agents discovered that Moreno had been previously deported from the United States and that he did not have permission to legally be in the territory.
The case was investigated Homeland Security Investigations (HSI) and U.S. Customs and Border Protection (CBP) and prosecuted by Assistant United States Attorney Sigrid M. Tejo-Sprotte.
Lewis County man admits to firearms chargeRead the Press Release
ELKINS, WEST VIRGINIA – Roger Lee Clem, II, aka “Woody,” of Weston, West Virginia, has admitted to a firearms charge, United States Attorney Bill Powell announced.
Clem, age 30, pled guilty to one count of “Possession of a Stolen Firearm.” Clem admitted to having a stolen .45-caliber pistol in Lewis County in October 2016.
Clem faces up to 10 years incarceration and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Stephen D. Warner is prosecuting the case on behalf of the government. The Bureau of Alcohol, Firearms, Tobacco and Explosives, The Mountain Region Drug & Violent Crime Task Force, the Greater Harrison Drug &Violent Crime Task Force, a HIDTA-funded initiative, the West Virginia State Police, Upshur County Sheriff’s Office, Lewis County Sheriff’s Office, the Buckhannon Police Department, and the Weston Police Department investigated.
U.S. Magistrate Judge Michael John Aloi presided.Justice Department Files Sexual Harassment Lawsuit Against Owner of Cullman, Alabama, Rental PropertyRead the Press Release
The Justice Department today announced that it has filed a lawsuit alleging that Randy Hames, a residential property owner and landlord in Cullman, Alabama, subjected female tenants to egregious sexual harassment in violation of the Fair Housing Act. Along with Randy Hames, the Department’s complaint names his residential property company, Hames Marina, LLC, as a defendant.
The complaint, filed in the U.S. District Court for the Northern District of Alabama, alleges that since at least 2011, Hames sexually harassed numerous women who lived in the defendants’ residential property. The suit alleges that Hames’s conduct included demanding or pressuring female tenants to engage in sexual acts with him in exchange for rent or to prevent eviction; evicting female tenants when they refused his advances; making female tenants feel unsafe by stalking them and entering their residences without permission; and making unwelcome sexual comments and advances.
“Subjecting female tenants to harassment and demands for sex is offensive and illegal,” said Acting Assistant Attorney General John Gore. “The Justice Department will continue its vigorous enforcement of the Fair Housing Act against landlords who engage in this reprehensible conduct. No woman should feel unsafe in her own home.”
“The alleged behavior of Randy Hames is abhorrent and repulsive. We will not let women, or any person, in our district be threatened, harassed, or retaliated against by landlords,” said U.S. Attorney Jay E. Town for the Northern District of Alabama. “The Fair Housing Act is an extraordinary tool that allows the Department of Justice to protect all tenants from egregious misconduct, like sexual harassment, and we will continue to strongly enforce all violations of it.”
The Justice Department’s Sexual Harassment in Housing Initiative (SHHI) was launched in October 2017 and expanded nationally in April 2018. The initiative specifically seeks to increase the Department’s efforts to protect individuals from harassment by landlords, property managers, maintenance workers, security guards, loan officers, or other people who have control over housing. The Justice Department has filed or settled 10 sexual harassment cases and has recovered over $1.6 million for victims of sexual harassment in housing since Jan. 20, 2017. Today’s lawsuit seeks monetary damages to compensate the victims, civil penalties, and a court order barring future discrimination. The complaint contains allegations of unlawful conduct. The allegations must be proven in federal court.
Individuals who believe that they may have been victims of sexual harassment or discrimination at rental dwellings owned or operated by Randy Hames or Hames Marina, or who have other information that may be relevant to this case, should contact the Housing Discrimination Tip Line, by calling 1-800-896-7743, pressing 1 to continue in English, and selecting mailbox 7 to leave a message.
The federal Fair Housing Act prohibits discrimination in housing based on race, color, religion, national origin, sex, disability, and familial status. More information about the Civil Rights Division and the laws it enforces is available at http://www.justice.gov/crt.
Individuals who believe that they may have been victims of sexual harassment in housing should call the Justice Department at 1-844-380-6178, send an e-mail to [email protected], or contact the Department of Housing and Urban Development (HUD) at 1-800-669-9777. If you have information or questions about any other housing discrimination, you can contact the Justice Department at 1-800-896-7743.
Judge Sentences CPA to Prison for Helping Cyber Charter School CEO in Fraud SchemeRead the Press Release
PITTSBURGH, PA - A resident of Koppel, Pennsylvania, has been sentenced by a federal district court judge in Pittsburgh, Pennsylvania, to one year and a day in prison on charges of Criminal Conspiracy to Impede the Lawful Functions of the Internal Revenue Service in Ascertaining and Collecting Taxes, United States Attorney Scott W. Brady announced today.
Neal Prence, 62, entered a plea of guilty on September 28, 2016, to Count 6 (Criminal Conspiracy) of an Indictment that was returned by a grand jury against Prence and co-defendant Nicholas Trombetta in August of 2013. In his plea, Prence acknowledged that his actions had played a part in causing a tax loss to the Federal Government that Judge Conti found was $437,632.
According to the particular charges set forth in Count 6 of the Indictment, Prence, a certified public accountant, was instrumental in aiding the former head of the PA Cyber Charter School, Trombetta, in funneling approximately $8,000,000 from PA Cyber through an entity then known as NNDS and finally to a company called Avanti Management Group, where Trombetta had free access to the funds. Among the matters charged in Count 6 that were attributed to Prence were the filing of tax returns that attributed Trombetta’s income to the four straw owners of Avanti, the filing of false tax returns by Trombetta’s sister, Elaine Trombetta Neill, and the filing of false tax returns on behalf of Trombetta. All of this was done to disguise income that should have been reported by Trombetta, but was shifted to other persons or entities.
At the sentencing proceeding, Chief U.S. District Judge Joy Flowers Conti also imposed a three-year term of supervised release on Prence and ordered him to pay $50,000 in restitution to the IRS. Judge Conti stated that, "As a CPA, Prence knew what he was doing was illegal."
Assistant United States Attorneys Stephen R. Kaufman, Robert S. Cessar and James R. Wilson prosecuted this case on behalf of the government.
The Internal Revenue Service, Criminal Investigation, the Federal Bureau of Investigation and the United States Department of Education – Office of Inspector General conducted the investigation leading to the prosecution of this case.
Judge Finds Ohio Man Guilty of Possessing CocaineRead the Press Release
PITTSBURGH, PA - Upon the conclusion of a non-jury trial before United States District Judge Reginald B. Walton, Judge Walton found Adolph Brown guilty of one count of possession with intent to distribute 500 grams or more of cocaine, United States Attorney Scott W. Brady announced today.
Brown, 47, formerly of Akron, Ohio, waived his right to a jury trial, resulting in a non-jury bench trial before the Honorable Judge Walton in Pittsburgh, Pennsylvania.
According to Assistant United States Attorneys Stephen S. Gilson and Eric Olshan, who prosecuted the case, the evidence presented at trial established that, on March 2, 2015, Adolph Brown traveled from Akron, Ohio, to Farrell, Pennsylvania, for the purposes of completing a sale of approximately 722 grams of cocaine. While on his way to Farrell, the vehicle Brown was traveling in was stopped by police and searched. The search resulted in the discovery of the cocaine hidden behind inside a child’s car seat in the back seat of the vehicle. Upon the discovery of the cocaine, Brown voluntarily spoke with special agents from the Federal Bureau of Investigation, who were leading the investigation In this interview with the FBI, Brown admitted that the cocaine was his and that he was on his way to sell the cocaine to a customer in Farrell. Drug lab reports later confirmed the amount and type of narcotics was approximately 722 grams of cocaine.
Judge Walton scheduled sentencing for November 13, 2018 at 2 p.m. The law provides for a total sentence of not less than 10 years and not more than life in prison, a fine not to exceed $8,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based on the seriousness of the offense and the prior criminal history, if any, of the defendant.
Pending sentencing, the court continued the defendant’s detention.
The Federal Bureau of Investigation conducted the investigation thethat led to the prosecution of Adolph Brown, with assistance from the Southwest Mercer County Regional Police Department, the Pennsylvania State Police, and the Pennsylvania Attorney General’s Office.
Hurricane Felon Sentenced to Federal Prison for Gun CrimeRead the Press Release
CHARLESTON, W.Va. – A Hurricane man who possessed a firearm in April 2017 was sentenced today to 27 months in federal prison, announced United States Attorney Mike Stuart. Brandon Pistore, 34, previously pled guilty to being a felon in possession of a firearm. U.S. Attorney Stuart commended the investigative efforts of the St. Albans Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
On April 19, 2017, an officer with the St. Albans Police Department stopped a vehicle Pistore was driving and discovered a gun. The officer seized the firearm, a Davis Industries, Model P380 pistol. Pistore later admitted that it was his gun. He was prohibited from possessing any firearm under federal law because of a 2006 federal drug conviction for conspiracy to manufacture methamphetamine.
“Just another felon with an illegal firearm,” said United States Attorney Mike Stuart. “So many felons and so many illegal firearms, too many press releases read the same. That’s okay. We are going to keep arresting and prosecuting them to the fullest extent of the law for the longest prison sentences possible.”
Assistant United States Attorney Meredith George Thomas was in charge of the prosecution. Senior United States District Judge David A. Faber handed down the sentence.
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.
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Health Quest and Putnam Hospital Center to Pay $14.7 Million to Resolve False Claims Act AllegationsRead the Press Release
Health Quest Systems, Inc. and certain of its subsidiaries (Health Quest) and Putnam Health Center (PHC) have agreed to pay over $14.7 million to resolve allegations of violations of the False Claims Act by submitting inflated and otherwise ineligible claims for payment, the Justice Department announced today. New-York based Health Quest is a family of integrated hospitals and healthcare providers that deliver surgical, medical and home health care services. PHC is a Health Quest subsidiary hospital based in Carmel Hamlet, New York.
“This resolution is a testament to our deep commitment to protecting the integrity of federally- funded healthcare programs,” said Acting Assistant Attorney General Chad A. Readler for the Justice Department’s Civil Division. “We are determined to hold accountable healthcare providers that knowingly claim taxpayer funds to which they are not entitled.”
In the settlement announced today, Health Quest and PHC admitted, acknowledged, and accepted responsibility for certain facts involving the submission of improper claims for various health-related services, including the following:
From April 1, 2009 through June 23, 2015, Health Quest submitted claims for evaluation and management services but did not sufficiently document the services to support the level of service billed. As a result, the services were billed two levels higher than supported by the medical record.
From April 1, 2011 through August 2014, Health Quest submitted claims for home health services that lacked sufficient medical records to support the claim, including documentation of a face-to-face encounter with a physician.
From March 1, 2014 through December 31, 2014, Health Quest subsidiary hospital, PHC, submitted allegedly false claims for inpatient and outpatient services referred to PHC by two orthopedic physicians, in alleged violation of the Physician Self-Referral Law. The two physicians had a direct financial relationship with PHC for providing administrative services and received compensation from PHC. The United States alleged their compensation exceeded the fair market value for the services, and thereby violated the Physician Self-Referral Law, which prohibits a hospital from billing Medicare for certain services referred by physicians with whom the hospital has an improper compensation arrangement. The United States further alleged that one purpose of the excessive compensation was to induce the above referrals to PHC, in violation of the Anti-Kickback Statute.
“Today’s settlement holds Heath Quest responsible for false billings to federally funded health care programs, as well as claims tainted by a hospital’s payments to two physicians for administrative services where it appears that one purpose of those payments was to improperly induce referrals. Hospitals and providers must be vigilant to make sure that claims accurately reflect medical services provided and are supported by sufficient documentation. We will continue to investigate whistleblower complaints vigorously to protect public funds,” said United States Attorney Grant C. Jaquith for the Northern District of New York.
As part of the settlements announced today, Health Quest will pay an additional $895,427 to the State of New York, which jointly funds the State’s Medicaid program with the federal government.
Contemporaneously with the False Claims Act settlement, Health Quest also agreed to enter into a Corporate Integrity Agreement (CIA) with HHS-OIG to address future compliance.
“Government health program dollars are precious and need to be carefully guarded,” said Scott J. Lampert, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services (HHS-OIG). “Working closely with our law enforcement partners we will fight for the integrity of these taxpayer-funded programs.”
The settlement resolves three lawsuits brought by former employees of Health Quest under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private citizens to bring lawsuits on behalf of the United States and obtain a portion of the government’s recovery. Tim Cleary will receive $1,893,092, John Betaudier and Carolyn Carroll will receive, collectively, $56,266, and Gregory Folta will receive at least $875,546.
The lawsuits, are captioned: United States, et al. ex rel. Folta v. Health Quest Systems, Inc., et al., No. 1:15-cv-396 (N.D.N.Y.); United States, et al. ex rel. Cleary v. Health Quest Systems, Inc., et al., No. 16-cv-76 (N.D.N.Y.); and United States, et al. ex rel. Betaudier and Carroll v. Health Quest Medical, Practice, P.C., et al., No. 1:16-cv-1344 (N.D.N.Y.).
The federal government’s resolution of these matters illustrate its emphasis on combating health care fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
These matters were investigated by the Civil Division’s Commercial Litigation Branch; the U.S. Attorney’s Office for the Northern District of New York; HHS-OIG; the FBI; and the U.S. Postal Service Office of Inspector General.
Health Quest and Putnam Hospital Center to Pay $14.7 Million to Resolve False Claims Act AllegationsRead the Press Release
SYRACUSE, NEW YORK - Health Quest Systems, Inc. and certain of its subsidiaries (Health Quest) and Putnam Health Center (PHC) have agreed to pay over $14.7 million to resolve allegations of violations of the False Claims Act by submitting inflated and otherwise ineligible claims for payment, the Justice Department announced today. New-York based Health Quest is a family of integrated hospitals and healthcare providers that deliver surgical, medical and home health care services. PHC is a Health Quest subsidiary hospital based in Carmel Hamlet, New York.
“This resolution is a testament to our deep commitment to protecting the integrity of federally- funded healthcare programs,” said Acting Assistant Attorney General Chad A. Readler for the Justice Department’s Civil Division. “We are determined to hold accountable healthcare providers that knowingly claim taxpayer funds to which they are not entitled.”
In the settlement announced today, Health Quest and PHC admitted, acknowledged, and accepted responsibility for certain facts involving the submission of improper claims for various health-related services, including the following:
From April 1, 2009 through June 23, 2015, Health Quest submitted claims for evaluation and management services but did not sufficiently document the services to support the level of service billed. As a result, the services were billed two levels higher than supported by the medical record.
From April 1, 2011 through August 2014, Health Quest submitted claims for home health services that lacked sufficient medical records to support the claim, including documentation of a face-to-face encounter with a physician.
From March 1, 2014 through December 31, 2014, Health Quest subsidiary hospital, PHC, submitted allegedly false claims for inpatient and outpatient services referred to PHC by two orthopedic physicians, in alleged violation of the Physician Self-Referral Law. The two physicians had a direct financial relationship with PHC for providing administrative services and received compensation from PHC. The United States alleged their compensation exceeded the fair market value for the services, and thereby violated the Physician Self-Referral Law, which prohibits a hospital from billing Medicare for certain services referred by physicians with whom the hospital has an improper compensation arrangement. The United States further alleged that one purpose of the excessive compensation was to induce the above referrals to PHC, in violation of the Anti-Kickback Statute.
“Today’s settlement holds Heath Quest responsible for false billings to federally funded health care programs, as well as claims tainted by a hospital’s payments to two physicians for administrative services where it appears that one purpose of those payments was to improperly induce referrals. Hospitals and providers must be vigilant to make sure that claims accurately reflect medical services provided and are supported by sufficient documentation. We will continue to investigate whistleblower complaints vigorously to protect public funds,” said United States Attorney Grant C. Jaquith for the Northern District of New York.
As part of the settlements announced today, Health Quest will pay an additional $895,427 to the State of New York, which jointly funds the State’s Medicaid program with the federal government.
Contemporaneously with the False Claims Act settlement, Health Quest also agreed to enter into a Corporate Integrity Agreement (CIA) with HHS-OIG to address future compliance.
“Government health program dollars are precious and need to be carefully guarded,” said Scott J. Lampert, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services (HHS-OIG). “Working closely with our law enforcement partners we will fight for the integrity of these taxpayer-funded programs.”
The settlement resolves three lawsuits brought by former employees of Health Quest under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private citizens to bring lawsuits on behalf of the United States and obtain a portion of the government’s recovery. Tim Cleary will receive $1,893,092, John Betaudier and Carolyn Carroll will receive, collectively, $56,266, and Gregory Folta will receive at least $875,546.
The lawsuits, are captioned: United States, et al. ex rel. Folta v. Health Quest Systems, Inc., et al., No. 1:15-cv-396 (N.D.N.Y.); United States, et al. ex rel. Cleary v. Health Quest Systems, Inc., et al., No. 16-cv-76 (N.D.N.Y.); and United States, et al. ex rel. Betaudier and Carroll v. Health Quest Medical, Practice, P.C., et al., No. 1:16-cv-1344 (N.D.N.Y.).
The federal government’s resolution of these matters illustrate its emphasis on combating health care fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
These matters were investigated by the Civil Division’s Commercial Litigation Branch; the U.S. Attorney’s Office for the Northern District of New York; HHS-OIG; the FBI; and the U.S. Postal Service Office of Inspector General.
Hartford Man Sentenced to 3 Years in Federal Prison for Drug and Gun OffensesRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that JOSEPH STEELE, also known as “Joey,” 32, of Hartford, was sentenced today by U.S. District Judge Michael P. Shea in Hartford to 36 months of imprisonment, followed by three years of supervised release, for drug and firearm offenses.
According to the evidence disclosed during his trial, on June 14, 2017, the Hartford Police Department’s Vice and Narcotics Unit received information that STEELE was in possession of a firearm while operating a white Cadillac. Investigators located the Cadillac and conducted a traffic stop at the intersection of Enfield Street and Capen Street. After STEELE consented to a search of the vehicle, investigators lifted a rear seat cushion and found a stolen .40 caliber semiautomatic pistol, 50 wax folds of fentanyl, and two knotted plastic bags containing approximately 6.5 grams of crack cocaine.
In April 2016, STEELE was convicted in Connecticut Superior Court of possession of a pistol without a permit, and was sentenced to 18 months of incarceration for that conviction. He was released from state prison in March 2017 and was serving a three-year term of probation when he was found in possession of the stolen firearm, fentanyl and crack.
On April 16, 2018, a jury found STEELE guilty of one count of possession with intent to distribute cocaine base (“crack”), one count of possession with intent to distribute fentanyl, and one count of possession of a firearm by a previously convicted felon. STEELE was acquitted of one count of possession of a firearm in furtherance of a drug trafficking crime.
STEELE has been detained since his arrest on June 14, 2017.
This investigation was conducted by the Hartford Police Department’s Vice and Narcotics Unit and the FBI’s Northern Connecticut Violent Crime Gang Task Force, which includes members of the Hartford Police Department, East Hartford Police Department, Connecticut State Police and Connecticut Department of Correction. The case was prosecuted by Assistant U.S. Attorneys Michael J. Gustafson and Jocelyn Courtney Kaoutzanis.
This prosecution stems from Project Longevity, a comprehensive initiative to reduce gun violence in Connecticut’s major cities. Through Project Longevity, community members and law enforcement directly engage with members of groups that are prone to violence. A critical component of the Project Longevity strategy is the “call-in,” a face-to-face meeting where Project Longevity partners engage group members and deliver a community message against violence, a law enforcement message about the consequences of further violence and an offer of help for those who want it. STEELE attended a call-in in May 2017 and declined Project Longevity services that were offered to him.
Harrison County man admits to methamphetamine chargeRead the Press Release
CLARKSBURG, WEST VIRGINIA –Jacob Renard White, of Clarksburg, West Virginia, has admitted to methamphetamine distribution, United States Attorney Bill Powell announced.
White, age 30, pled guilty to one count of “Conspiracy to Possess with Intent to Distribute and Distribute Methamphetamine.” White admitted to distributing methamphetamine in February of 2017 in Harrison County.
White faces up to 20 years incarceration and a fine of up to $1,000,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Andrew R. Cogar is prosecuting the cases on behalf of the government. The Greater Harrison Drug and Violent Crimes Task Force, a HIDTA-funded initiative, investigated.
U.S. Magistrate Judge Michael John Aloi presided.
Greensboro Man Sentenced to 32 Years in Prison for Extensive Bank Lien Theft Scheme, Money Laundering, & Aggravated Identity TheftRead the Press Release
RALEIGH – The United States Attorney for the Eastern District of North Carolina, Robert J. Higdon, Jr., announced that today in federal court Senior United States District Judge W. Earl Britt sentenced XAVIER MILTON EARQUHART, 31, of Greensboro, NC to serve 32 years in prison and 5 years of supervised release on ten counts of Bank Fraud, two counts of Engaging in Monetary Transactions Involving Criminally Derived Property and one count of Aggravated Identity Theft and Aiding and Abetting. EARQUHART was also ordered to make restitution in the amount of $1,570,561.86, and to forfeit a stash of gold bullion, cash, and studio equipment previously seized by law enforcement. Today’s sentencing follows a three-day jury trial in March in which a jury convicted EARQUHART on all counts.
The evidence at trial showed that, in one bank fraud scheme, the defendant forged a deed on a property owned by an out of state landowner, and then channeled the property ownership through fictitious individuals and a holding company before personally taking title to the property. The defendant then attempted to secure $495,000 in home equity loans using the property as collateral, becoming successful on three such attempts.
In a second scheme, the evidence showed that the defendant forged bank lien releases on 8 properties, in some instances, by stealing the identities of bank employees, and in other instances, using fictitious notaries. The defendant created Delaware holding companies to conceal his activities. The defendant then sold the properties off to unknowing third parties. At trial, the evidence showed that because of the defendant’s actions, some homeowners lost the funds that they had invested into the properties. Other victims were left uncertain as to the ability of their families to remain in the homes due to the cloud upon their title.
Lastly, the evidence at trial included evidence from law enforcement concerning the tracing of the defendant’s fraudulent gains. Law enforcement used a note and key found in the defendant’s Prius to uncover a hidden trove of $300,000 worth of gold, concealed in a storage unit in Spring, Texas. Law enforcement also seized various items of valuable recording studio equipment.
United States Attorney Robert J. Higdon, Jr. stated: “This was a crime that hurt not just banks, but also individuals and families who feared they would lose their homes through no fault of their own. The defendant will have plenty of time to think about the harm he has caused during the next 32 years in prison. I want to recognize the great work of IRS Criminal Investigation who tracked down and seized the defendant’s treasure chest filled with hundreds of thousands of dollars in gold bullion which will now benefit the victims in this case.”
"Today's announcement exemplifies the intense focus our Special Agent’s engage in when unraveling complex schemes such as this one orchestrated by Xavier Earquhart,” said Special Agent in Charge of the IRS Criminal Investigation, Charlotte Field Office, Matthew D. Line. “Earquhart’s scheme was driven by insatiable greed and a blatant disregard for the tremendous damage inflicted on innocent victims. Be assured that IRS Criminal Investigation will continue to work with our law enforcement partners to hold those who engage in similar behavior fully accountable."
The investigation of this case was conducted by the IRS Criminal Investigation, with the assistance of the Federal Deposit Insurance Corporation Office of the Inspector General, and the Wake County Register of Deeds. Assistant United States Attorney William M. Gilmore represented the government in this case.
Former NBA Player Sentenced for False Tax Returns, Identity Theft Related to Charity Fraud SchemeRead the Press Release
KANSAS CITY, Mo. – A former professional basketball player was sentenced in federal court today on charges related to an extensive charity fraud scheme.
Kermit Alan Washington, 66, of Las Vegas, Nev., was sentenced by U.S. District Judge Greg Kays six years in federal prison without parole. The court also ordered Washington to pay $967,158 in restitution. Washington was taken into federal custody at the conclusion of today’s sentencing hearing.
“This former NBA player abused his fame and status to promote a charity scam by which he raised hundreds of thousands of dollars that he diverted to personal spending on lavish vacations, shopping sprees, and even plastic surgery for his girlfriend,” said Garrison. “Although he told his donors that 100 percent of all donations would go to support charitable work in Africa, including a medical clinic for needy families and HIV-positive children, in fact he spent most of the donated funds on himself. His fraud scheme also victimized law-abiding taxpayers by stealing from the public treasury rather than paying taxes owed.”
On Nov. 30, 2017, Washington pleaded guilty to two counts of filing a false tax return and one count of aggravated identity theft. Washington is among 11 defendants who have been convicted in several cases arising from the investigation of one of the largest software piracy schemes ever prosecuted by the U.S. Department of Justice. Investigators seized more than $20 million in assets from conspirators who are estimated to have sold in excess of $100 million worth of illicit, unauthorized and counterfeit software products to thousands of online customers.
eBay/PayPal Software Piracy Fraud Scheme
Washington’s charity, The Sixth Man Foundation, doing business as Project Contact Africa, operated an eBay store and used a PayPal account to facilitate payments. Approximately $12 million in items, including unauthorized, illicit, and counterfeit software and software components were sold on the Project Contact Africa eBay store.
In a separate but related case, Reza Davachi of Damascus, Md., pleaded guilty to a fraud scheme for abusing the benefits afforded a charity in these sales on Project Contact Africa’s eBay store.
Customers of the charity’s eBay store were under the impression that “100 percent” of the proceeds of sales were intended to go to the charity when, in fact, only a portion of the proceeds actually went to the charity. Washington admitted that he diverted funds from the charity’s bank account to pay himself or for personal spending, such as rent, credit card payments, vacation trips and plastic surgery for his then-girlfriend. Washington claimed to pay the rent and school fees for a family in Africa when, in fact, these payments were to a former prostitute, and rose and fell depending on their level of sexual intimacy.
By using the charity’s account to sell items through the eBay charity store, conspirators saved thousands of dollars per month that would have otherwise been paid to eBay in the form of various fees. As a result, eBay/PayPal sustained losses of approximately $908,231 due to the waived fees.
Workers’ Compensation Referral Scheme
Washington also admitted that he referred professional athletes to attorney Ronald Jack Mix, 80, of San Diego, Calif., so that Mix could file workers’ compensation claims in the state of California on behalf of the athletes. Mix then agreed to make donations to Washington’s charity.
Washington accepted approximately $155,000 in donations to his charity, which were actually illegal referral payments from Mix and his law firm. Washington diverted those funds from the charity’s bank account to pay himself or for personal spending. Washington admitted that he failed to account for this income to the charity on Project Contact Africa’s IRS filings during those years.
In a separate but related case, Mix pleaded guilty to filing a false tax return. Mix admitted that he made donations ranging from $5,000 to $25,000 for referrals of athletes, some of whom lived in the Western District of Missouri. Mix then claimed those payments as charitable contributions on his individual tax returns from 2010 to 2013. Mix was sentenced to time served and ordered to pay $49,543 in restitution.
False Tax Returns, Identity Theft
According to court documents, Washington diverted charity proceeds and failed to declare this income on federal income tax returns from 2010 to 2014. During this time, Washington also improperly claimed tens of thousands of dollars in personal charitable deductions. Washington’s additional tax due for his underreported income is $90,181.
Additionally, Washington is assessed $876,977 in excess benefit taxes related to the payment of excess benefits to a disqualified person (the use of charity funds for personal purposes by an officer of a charity). Washington’s accumulated tax loss for 2010 through 2014 thus totals $976,158.
Washington specifically pleaded guilty to filing a materially false individual tax return on Feb. 18, 2014, and to filing a materially false Form 990-EZ for his tax-exempt organization on Aug. 20, 2012.
Washington also specifically pleaded guilty to using the name, personal address and business address of another person without lawful authority in numerous state and federal filings on behalf of the charity. The identity theft victim, identified in court documents as “T.G.”, was a resident of Oregon. Washington admitted that he used her identity information so that Project Contact Africa could maintain its active status within the state of Oregon, which enabled the charity to receive the charitable donations and to maintain the charity store on eBay.
This case was prosecuted by Assistant U.S. Attorneys Patrick Daly and Curt Bohling in the Western District of Missouri and Assistant U.S. Attorney Ryan Raybould of the Middle District of Tennessee (formerly of the Department of Justice Tax Division). It was investigated by IRS-Criminal Investigation and Immigration and Customs Enforcement’s Homeland Security Investigations.
Former Kansas CPA Ordered to Pay Costs of His Own ImprisonmentRead the Press Release
KANSAS CITY, KAN. – A former Kansas CPA was sentenced Monday to a year and a day in jail and ordered to pay the cost of his imprisonment, which could be an estimated $34,000, U.S. Attorney Stephen McAllister said. In addition, the accountant was ordered to pay $106,055 in restitution for unpaid taxes.
Robert M. Purinton, 70, Fountain Hills, Ariz., pleaded guilty to one count of making a false statement on his 2009 tax return by under-reporting his income. He agreed to make restitution for taxes owed in 2009 and 2010. During those years, he was a CPA with an accounting firm in Overland Park.
McAllister commended the Internal Revenue Service and Assistant U.S. Attorney Leon Patton for their work on the case.
Former Boy Scout Employee Arrested, Charged with Possession of Child PornographyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051Investigators Looking for Help from the Public
BUFFALO, N.Y.-U.S. Attorney James P. Kennedy, Jr. announced today that Russell Ruth, 34, of Lyons, NY, was arrested and charged by criminal complaint with possession of child pornography. The charge carries a maximum penalty of 10 years in prison and a $250,000 fine.Assistant U.S. Attorney Melissa M. Marangola, who is handling the case, stated that according to the complaint, in early March 2018, Yahoo! reported to the National Center for Missing and Exploited Children (NCMEC) that a subscriber uploaded five suspected child pornography files to a Yahoo! server. NCMEC contacted law enforcement officers who traced the files to an email address belonging to the defendant.
On June 7, 2018, the New York State Police executed the search warrant at Ruth’s Ditton Street residence in Lyons. A forensic examination of the defendant’s laptop computer and cellular telephone recovered hundreds of images and videos of child pornography involving minor boys.
The defendant was employed by the Boy Scouts of America in the Ovid, NY area.
Members of the public who have information related to this case are urged to contact the local HSI Buffalo Office at 716-464-5949. HSI victim-witness specialists will be available to assist any parent or guardian should they need victim-related resources. If any members of the public have general questions or concerns regarding sexual abuse of children or would like guidance on how to discuss this issue with children, please call the Bivona Child Advocacy Center at 1-585-935-7800.
Ruth made an initial appearance today before U.S. District Judge Jonathan W. Feldman and is being held pending a detention hearing on July 11, 2018, at 2:30 p.m.
The complaint is the result of investigation by Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent-in-Charge Kevin Kelly.
The fact that a defendant has been charged with a crime is merely an accusation and the defendant is presumed innocent until and unless proven guilty.
Former Avoyelles Correctional Center warden’s ex-wife pleads guilty to conspiracy chargeRead the Press Release
ALEXANDRIA, La. – United States Attorney David C. Joseph announced today that the ex-wife of a former warden for the Avoyelles Correctional Center pleaded guilty to conspiracy to commit wire fraud.
Tonia Bandy Cain, 43, of Moreauville, Louisiana, pleaded guilty before U.S. District Judge Dee D. Drell to one count of conspiracy to commit wire fraud. According to the guilty plea, Nathan Burl Cain II, 51, also of Moreauville, was the warden of Avoyelles Correctional Center located in Cottonport, Louisiana, and Tonia Cain served as the manager of the business office of the facility. They are accused of using Louisiana Department of Corrections credit cards to purchase items for personal use while misrepresenting that the items were bought for official use between December 2012 and January 2016. The defendants are also accused of structuring purchases to evade state purchasing restrictions.
Tonia Cain faces up to 20 years in prison, five years of supervised release and a fine of $250,000. The court set sentencing for October 9, 2018. Nathan Cain was indicted for one count of conspiracy and 17 counts of wire fraud.
The FBI and the Louisiana Office of Inspector General conducted the investigation. Assistant U.S. Attorneys John Luke Walker and David J. Ayo are prosecuting the case.
Federal Court Dismisses Spokane Postal Service Employee’s Discrimination CaseRead the Press Release
Spokane– Joseph H. Harrington, United States Attorney for the Eastern District of Washington, announced that United States District Judge Salvador Mendoza, Jr. dismissed a discrimination case filed against the U.S. Postal Service by Justin Harter, a former temporary employee.
According to information disclosed during court proceedings, Harter, a resident of Missoula, Montana who has American Indian/Alaska Native heritage, worked as a temporary Postal Support Employee (PSE) during the 2014 holiday season at the U.S. Postal Service’s Processing and Distribution Center near the Spokane Airport. Harter and several other temporary PSEs were let go after the Christmas holiday season. In 2015, Harter applied for temporary holiday positions with the U.S. Postal Service but was not rehired.
Harter filed a complaint with the Postal Service’s Equal Employment Opportunity Office (EEO) claiming race and gender discrimination. After the EEO found no discrimination, Harter filed suit in federal court. Harter’s civil complaint alleged race and gender-based discrimination, breach of employment contract, and use of prohibited practices by the Postal Service.
In dismissing Harter’s race and gender-based discrimination claims, Judge Mendoza found Harter had not produced evidence that he suffered an adverse employment action connected to gender discrimination or that the Postal Service treated him differently because of his race. Judge Mendoza also concluded the Postal Service had articulated a legitimate, non-discriminatory reason for not rehiring Harter in 2015. Judge Mendoza dismissed Harter’s breach of contract and prohibited practices claims in November/December 2017.
U.S. Attorney Harrington said, “Claims of employment discrimination in federal employment are taken seriously. But when meritless lawsuits are brought, our office is dedicated to vigorously defending those suits and protecting the public purse.”
This case was defended by Rudy J. Verschoor, an Assistant United States Attorney for the Eastern District of Washington.
District Court Orders Minnesota Dairy Farm and Owners to Stop Distributing Adulterated Meat in Interstate CommerceRead the Press Release
A federal court enjoined Todd & Patty Meech Dairy Farm and its co-owners from introducing adulterated meat into interstate commerce pending required remedial action, the Department of Justice announced today.
The U.S. District Court for the District of Minnesota entered a consent decree of permanent injunction against the Meech Dairy Farm, located in Sebeka, Minnesota, and its co-owners Todd Meech and Patty Meech. The consent decree settles a complaint filed by the Department alleging violations of the Food, Drug, and Cosmetic Act, and it requires the defendants to implement specific steps to ensure consumer safety before they can resume introducing specific food – animals and their edible tissue, into interstate commerce. In particular, the decree requires defendants to establish and implement a quarantine or segregation system that ensures ready distinction between medicated and unmediated animals and that prevents defendants from selling or delivering for food slaughter any animals with illegal new animal drug residues in their edible tissues.
“The Department of Justice is committed to protecting consumers from unsafe foods,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “We will continue to work with FDA to ensure that food producers maintain processes necessary to keep food safe.”
The Department filed a complaint in the District of Minnesota on Feb. 23, at the request of the U.S. Food and Drug Administration (FDA). According to the complaint, the Meech Dairy Farm has approximately 500 cattle, including approximately 400 dairy cows, and sells cows for slaughter for use as food. The complaint alleged that defendants failed to abide by laws designed to protect consumers from consuming food that contained new animal drugs above legal limits. According to the complaint, lab testing by the U.S. Department of Agriculture (USDA) detected above-tolerance drug residue in the liver of one of defendant’s cows sold for slaughter. The complaint alleged that a FDA inspection confirmed that the defendants did not record information regarding administered dosage, administration route, withdrawal time for meat, or the usable date for meat.
High levels of new animal drugs in animals’ edible tissues poses a significant public health risk. For example, consumers of edible animal tissues who are susceptible to antibiotics may experience severe allergic reactions as a result of ingesting food containing antibiotic levels above established tolerances.
“Poor recordkeeping practices and improper administration of drugs to food-producing animals poses a serious risk to consumers,” said United States Attorney Erica H. MacDonald for the District of Minnesota. “The United States Attorney’s Office, along with the FDA, will continue to take action on these types of cases to ensure that Minnesota farmers are following the law and maintaining high food safety standards.”
The government is represented by Trial Attorney Monica Groat of the Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney Fred Siekert of the U.S. Attorney’s Office for the District of Minnesota, with assistance of Associate General Counsel for Enforcement Jennifer Argabright of the Department of Health and Human Services’ Office of General Counsel’s Food and Drug Division.
Additional information about the Consumer Protection Branch and its enforcement efforts may be found at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the District of Minnesota, visit its website at https://www.justice.gov/usao-mn.
District Court Orders Minnesota Dairy Farm and Owners to Stop Distributing Adulterated Meat in Interstate CommerceRead the Press Release
WASHINGTON – A federal court enjoined Todd & Patty Meech Dairy Farm and its co-owners from introducing adulterated meat into interstate commerce pending required remedial action, the Department of Justice announced today.
The U.S. District Court for the District of Minnesota entered a consent decree of permanent injunction against the Meech Dairy Farm, located in Sebeka, Minnesota, and its co-owners Todd Meech and Patty Meech. The consent decree settles a complaint filed by the Department alleging violations of the Food, Drug, and Cosmetic Act, and it requires the defendants to implement specific steps to ensure consumer safety before they can resume introducing specific food – animals and their edible tissue, into interstate commerce. In particular, the decree requires defendants to establish and implement a quarantine or segregation system that ensures ready distinction between medicated and unmediated animals and that prevents defendants from selling or delivering for food slaughter any animals with illegal new animal drug residues in their edible tissues.
“The Department of Justice is committed to protecting consumers from unsafe foods,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “We will continue to work with FDA to ensure that food producers maintain processes necessary to keep food safe.”
The Department filed a complaint in the District of Minnesota on Feb. 23, at the request of the U.S. Food and Drug Administration (FDA). According to the complaint, the Meech Dairy Farm has approximately 500 cattle, including approximately 400 dairy cows, and sells cows for slaughter for use as food. The complaint alleged that defendants failed to abide by laws designed to protect consumers from consuming food that contained new animal drugs above legal limits. According to the complaint, lab testing by the U.S. Department of Agriculture (USDA) detected above-tolerance drug residue in the liver of one of defendant’s cows sold for slaughter. The complaint alleged that a FDA inspection confirmed that the defendants did not record information regarding administered dosage, administration route, withdrawal time for meat, or the usable date for meat.
High levels of new animal drugs in animals’ edible tissues poses a significant public health risk. For example, consumers of edible animal tissues who are susceptible to antibiotics may experience severe allergic reactions as a result of ingesting food containing antibiotic levels above established tolerances.
“Poor recordkeeping practices and improper administration of drugs to food-producing animals poses a serious risk to consumers,” said United States Attorney Erica H. MacDonald for the District of Minnesota. “The United States Attorney’s Office, along with the FDA, will continue to take action on these types of cases to ensure that Minnesota farmers are following the law and maintaining high food safety standards.”
The government is represented by Trial Attorney Monica Groat of the Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney Fred Siekert of the U.S. Attorney’s Office for the District of Minnesota, with assistance of Associate General Counsel for Enforcement Jennifer Argabright of the Department of Health and Human Services’ Office of General Counsel’s Food and Drug Division.
Additional information about the Consumer Protection Branch and its enforcement efforts may be found at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the District of Minnesota, visit its website at https://www.justice.gov/usao-mn.
Department of Justice Seeks to Terminate “Legacy” Antitrust Judgments in Federal District Court in Washington, D.C.Read the Press Release
The Department of Justice’s Antitrust Division today filed a motion and supporting papers, seeking to terminate 19 “legacy” judgments in the District Court for the District of Columbia. Today’s court filing is part of the Antitrust Division’s effort to terminate decades-old antitrust judgments that no longer serve their original purpose.
“Today we have taken an important next step toward eliminating antitrust judgments that no longer protect competition,” said Assistant Attorney General for Antitrust, Makan Delrahim. “Today’s filing is the first of many that we will make in courts around the country in our effort to terminate obsolete judgments.”
In its motion filed today, the Antitrust Division explained that perpetual judgments rarely continue to protect competition, and those that are more than ten years old should be terminated absent compelling circumstances. Other reasons for terminating the judgments include that essential terms of the judgment have been satisfied, most defendants likely no longer exist, the judgment largely prohibits that which the antitrust laws already prohibit, and market conditions likely have changed. Each of these reasons suggests the judgments no longer serve to protect competition.
The Antitrust Division announced in April its initiative to terminate legacy antitrust judgments, stating that it would review all such judgments to identify those that no longer serve to protect competition. In its prior announcement, the Antitrust Division set forth the process by which it would seek the termination of outdated judgments. It also established a new public website (https://www.justice.gov/atr/JudgmentTermination) to serve as the primary source of information for the public regarding the initiative.
At the time that the Antitrust Division announced the initiative, it posted on its public website the legacy judgments in federal district court in Washington, D.C. and in Alexandria, Virginia. After a 30-day public comment period, the Antitrust Division concluded that termination of these 19 judgments is appropriate.
Since the announcement of its initiative, the Antitrust Division has posted for public comment judgments in 19 additional federal district courts. It will continue to post judgments periodically as review of those judgments by Antitrust Division attorneys is completed.
Members of the public are encouraged regularly to check the Antitrust Division’s Judgment Termination page on its website, www.justice.gov/atr/JudgmentTermination, for updates. Members of the public also may subscribe to the mailing list (https://public.govdelivery.com/accounts/USDOJ/subscriber/new) to receive notice of new postings to the website, including judgments that the Division has identified as appropriate for termination.
Dallas Attorney Sentenced for Marriage Fraud SchemeRead the Press Release
DALLAS — Bilal Ahmed Khaleeq, 48, a Dallas attorney, was sentenced today by U.S. District Judge David C. Godbey to 6 months in federal prison, announced U.S. Attorney Erin Nealy Cox of the Northern District of Texas.
Co-defendant Amna Cheema, 38, a Pakistani national, previously pleaded guilty to her role in the scheme and was sentenced to time served.
According to the plea agreement factual resume, in June 2015, Khaleeq and others knowingly and unlawfully conspired and agreed together and with each other to unlawfully facilitate and enter into a marriage between Cheema and a United States citizen, Person A, for the purpose of evading immigration laws. Cheema and Person A were married in Dallas County, Texas and subsequently filed permanent residence applications with USCIS in July 2015. In exchange for agreeing to marry Cheema, Person A was paid $745. Cheema also admitted engaging in discussions with Khaleeq and Person A at Khaleeq’s law office on more than one occasion to discuss preparation for the USCIS interview and required documentary evidence including joint bank accounts, tax returns, and bills concerning their joint residence. According to co-defendant Cheema, Khaleeq also represented the couple at the USCIS interview in April 2016 and advised them on additional evidence to make the marriage appear legitimate.
U.S. Immigrations and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) investigated the case. Special Assistant U.S. Attorney Lynn Javier prosecuted.
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Cohoes Man Pleads Guilty to Producing and Distributing Child PornographyRead the Press Release
ALBANY, NEW YORK – George Muzio, Jr., 37, of Cohoes, New York, pled guilty today to two counts of sexual exploitation of a child, six counts of distribution of child pornography, and one count of possession of child pornography, announced United States Attorney Grant C. Jaquith and Kevin M. Kelly, Special Agent in Charge of the Buffalo Field Office of Homeland Security Investigations (HSI).
As part of his guilty plea, Muzio admitted that between August 2014 and May 2016, he communicated with thirteen underage girls using his cellular phone and the Kik Messenger application. The minors lived throughout North America and ranged in age from 11 to 17 years old, with most being between 13 and 14 years old at the time the defendant engaged them in text-message exchanges via Kik. The communications, which Muzio frequently steered toward graphic sexual conversation, generally spanned thousands of messages sent and received over several months.
In pleading guilty Muzio admitted that he posed as a teenage boy and repeatedly requested and received sexually explicit photographs from the underage girls whom he targeted. As Muzio admitted, he texted detailed instructions to two victims about how he wanted them to pose in the sexually explicit photographs that they took and sent to him at his request. One of those victims, a resident of Montana with whom Muzio exchanged over 2,000 text messages over a period of 8 months, was 11 years old at the time. The second, a resident of Georgia with whom Muzio exchanged over 4,700 text messages over a period of 4 months, was 13 years old.
In addition, Muzio admitted that on six occasions between March 2015 and January 2016, he distributed child pornography videos from his Cohoes home through an Internet file-sharing program. He also admitted that on May 3, 2016, he possessed a laptop computer that contained approximately 400 child pornography videos depicting the sexual abuse of children as young as 10 years old.
Muzio, who has been in custody since March 2, 2018, is scheduled to be sentenced on November 6, 2018, at which time he faces a sentence of at least 15 years and up to 30 years in prison on each of the two counts of sexual exploitation, and between 5 and 20 years on the distribution counts, and up to 20 years on the possession count. He also can be sentenced to at least 5 years and up to lifetime post-imprisonment supervised release, and a maximum $250,000 fine. He 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 Homeland Security Investigations (HSI), with assistance from the Colonie Police Department and the Cohoes Police Department, and is being prosecuted by Assistant U.S. Attorneys Joseph A. Giovannetti and Emmet O’Hanlon.
This case is prosecuted as part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. Led by the United States Attorneys’ Offices, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
Buffalo Man Pleads Guilty to Production of Child PornographyRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051BUFFALO, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Daniel Sasiadek, 64, of Buffalo, NY, pleaded guilty to production of child pornography before U.S. District Judge Elizabeth Wolford. The charge carries a mandatory minimum penalty of 15 years in prison, a maximum of 30 years, and a fine of $250,000.
Assistant U.S. Attorney Marie P. Grisanti, who is handling the case, stated that between July 2004 and October 2004, the defendant produced child pornography of a child who was approximately six years old.
The plea is the result of an investigation by the Federal Bureau of Investigation, under the direction of Special Agent-in-Charge Gary Loeffert.
Sentencing is scheduled for October 24, 2018, at 2:30 p.m. before Judge Wolford.
Bridgeport Felon Pleads Guilty to Possessing Loaded FirearmRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that FEDERICO CANNON, also known as “Rico,” 36, of Bridgeport, pleaded guilty today before U.S. District Judge Stefan R. Underhill in Bridgeport to one count of possession of a firearm by a convicted felon.
According to court documents and statements made in court, on June 26, 2017, CANNON was released from federal prison after serving a 70-month sentence for possession of a firearm by a convicted felon. On July 31, 2017, while CANNON was on federal supervised release, Bridgeport Police received information that CANNON had a gun and was riding in a car in the area of the Trumbull Gardens housing complex in Bridgeport. Officers located and stopped the vehicle. After CANNON was removed from the car, officers located a 9mm semi-automatic SAR B6P handgun from the floor below the passenger seat where CANNON had been sitting. The gun was loaded with 16 rounds of ammunition.
CANNON has been detained since his arrest on July 31, 2017. Judge Underhill scheduled for December 3, 2018, at which time CANNON faces a maximum term of imprisonment of 10 years on the firearm charge and a maximum term of imprisonment of three years for violating the conditions of his supervised release.
This is CANNON’s third federal conviction for possession of a firearm by a convicted felon.
In the early morning hours of October 21, 2004, CANNON was in a car with three other individuals driving northbound on Interstate 95 between Norwalk and Bridgeport when they initiated a confrontation with another car occupied by two men. The confrontation culminated at the bottom of the Exit 25 ramp in Bridgeport when approximately seven or eight shots were fired at the victims’ vehicle. A subsequent search of the vehicle in which CANNON was a passenger revealed a semi-automatic pistol at CANNON’s feet in the right rear passenger seat of the vehicle. A jury in New Haven found CANNON guilty and, on April 12, 2006, he was sentenced to 42 months of imprisonment.
In the early morning hours of February 25, 2012, Bridgeport Police stopped a vehicle in which CANNON was a passenger on Caroline Street in Bridgeport. CANNON initially exited the vehicle and attempted to walk away, but police ordered him back into the car. After directing the driver out of the vehicle, a Bridgeport Police detective observed a 9mm semi-automatic pistol on the floor of the rear passenger area near where CANNON was sitting. The firearm was loaded with 10 live hollow-point cartridges and two full-metal jacket cartridges. A jury in Hartford found CANNON guilty and, on July 11, 2014, he was sentenced to 70 months of imprisonment, followed by three years of supervised release.
CANNON also has a state conviction stemming from a car stop by Bridgeport Police on June 6, 1999. On that date, officers located a .25 caliber semi-automatic handgun concealed under the right front passenger seat where CANNON had been sitting.
This matter was investigated by the Bridgeport Police Department’s Tactical Narcotics Team and the Federal Bureau of Investigation, with the assistance of the Bureau of Alcohol, Tobacco, Firearms and Explosives. The case is being prosecuted by Assistant U.S. Attorney Rahul Kale.
Birmingham Man Sentenced on Gun ChargesRead the Press Release
United States Attorney Richard W. Moore of the Southern District of Alabama announced that Darrius Lamar Smith, 31, of Birmingham, Alabama, was sentenced on June 29, 2018, to 30 months’ imprisonment on a federal charge of felon in possession of a firearm. Court documents show that Smith’s prior felony convictions were for Robbery First Degree in 2007, and Certain Persons Forbidden to Possess a Firearm in 2009, both in Circuit Court of Jefferson County, Alabama. Court documents also reflected that in March of 2018, Smith pled guilty to federal charge in Mobile, which alleged his illegal possession of a firearm in October of 2017.
United States District Court Judge Kristi K. Dubose sentenced Smith to 30 months’ imprisonment, noting that he had significant criminal history. The judge ordered that the sentence would run concurrently with another state case pending against Smith in the Circuit Court of Conecuh County, Alabama. The judge also ordered that Smith serve a three-year term of supervised release when he is discharged from his custody sentence, during which he will undergo further drug abuse and mental health treatment. Smith was also ordered to pay $100 in mandatory special assessments, but no fine was imposed.
The case was investigated by the Evergreen Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives. It was prosecuted in the United States Attorney’s Office by Assistant United Sates Attorney Gloria Bedwell.
$100 Million Settlement Will Speed Cleanup Work at Centredale Manor Superfund Site in North Providence, R.I.Read the Press Release
The U.S. Department of Justice, the U.S. Environmental Protection Agency (EPA), and the Rhode Island Department of Environmental Management (RIDEM) announced today that two subsidiaries of Stanley Black & Decker Inc.—Emhart Industries Inc. and Black & Decker Inc.—have agreed to clean up dioxin contaminated sediment and soil at the Centredale Manor Restoration Project Superfund Site in North Providence and Johnston, Rhode Island.
“We are pleased to reach a resolution through collaborative work with the responsible parties, EPA, and other stakeholders,” said Acting Assistant Attorney General Jeffrey H. Wood for the Justice Department's Environment and Natural Resources Division . “Today’s settlement ends protracted litigation and allows for important work to get underway to restore a healthy environment for citizens living in and around the Centredale Manor Site and the Woonasquatucket River.”
“This settlement demonstrates the tremendous progress we are achieving working with responsible parties, states, and our federal partners to expedite sites through the entire Superfund remediation process,” said EPA Acting Administrator Andrew Wheeler. “The Centredale Manor Site has been on the National Priorities List for 18 years; we are taking charge and ensuring the Agency makes good on its promise to clean it up for the betterment of the environment and those communities affected.”
“Successfully concluding this settlement paves the way for EPA to make good on our commitment to aggressively pursue cleaning up the Centredale Manor Superfund Site,” said EPA New England Regional Administrator Alexandra Dunn. “We are excited to get to work on the cleanup at this site, and get it closer to the goal of being fully utilized by the North Providence and Johnston communities.”
“We are pleased that the collective efforts of the State of Rhode Island, EPA, and DOJ in these negotiations have concluded in this major milestone toward the cleanup of the Centredale Manor Restoration Superfund site and are consistent with our long-standing efforts to make the polluter pay,” said RIDEM Director Janet Coit. “The settlement will speed up a remedy that protects public health and the river environment, and moves us closer to the day that we can reclaim recreational uses of this beautiful river resource.”
The settlement, which includes cleanup work in the Woonasquatucket River (River) and bordering residential and commercial properties along the River, requires the companies to perform the remedy selected by EPA for the Site in 2012, which is estimated to cost approximately $100 million, and resolves longstanding litigation.
The cleanup remedy includes excavation of contaminated sediment and floodplain soil from the Woonasquatucket River, including from adjacent residential properties. Once the cleanup remedy is completed, full access to the Woonasquatucket River should be restored for local citizens. The cleanup will be a step toward the State’s goal of a fishable and swimmable river. The work will also include upgrading caps over contaminated soil in the peninsula area of the Site that currently house two high-rise apartment buildings. The settlement also ensures that the long-term monitoring and maintenance of the site, as directed in the remedy, will be implemented to ensure that public health is protected.
Under the settlement, Emhart and Black & Decker will reimburse EPA for approximately $42 million in past costs incurred at the Site. The companies will also reimburse EPA and the State of Rhode Island for future costs incurred by those agencies in overseeing the work required by the settlement. The settlement will also include payments on behalf of two federal agencies to resolve claims against those agencies. These payments, along with prior settlements related to the Site, will result in a 100 percent recovery for the United States of its past and future response costs related to the Site.
Litigation related to the Site has been ongoing for nearly eight years. While the Federal District Court found Black & Decker and Emhart to be liable for their hazardous waste and responsible to conduct the cleanup of the Site, it had also ruled that EPA needed to reconsider certain aspects of that cleanup. EPA appealed the decision requiring it to reconsider aspects of the cleanup. This settlement, once entered by the District Court, will resolve the litigation between the United States, Rhode Island, and Emhart and Black and Decker, allowing the cleanup of the Site to begin.
The Site spans a one and a half mile stretch of the Woonasquatucket River and encompasses a nine-acre peninsula, two ponds and a significant forested wetland. From the 1940s to the early 1970s, Emhart’s predecessor operated a chemical manufacturing facility on the peninsula and used a raw material that was contaminated with 2,3,7,8-tetrachlorodibenzo-p-dioxin, a toxic form of dioxin. The Site property was also previously used by a barrel refurbisher. Elevated levels of dioxins and other contaminants have been detected in soil, groundwater, sediment, surface water and fish.
The Site was added to the National Priorities List (NPL) in 2000, and in December 2017, EPA included the Centredale Manor Restoration Project Superfund Site on a list of Superfund sites targeted for immediate and intense attention. Several short-term actions were previously performed at the Site to address immediate threats to the residents and minimize potential erosion and downstream transport of contaminated soil and sediment. This settlement is the latest agreement EPA has reached since the Site was listed on the NPL. Prior agreements addressed the performance and recovery of costs for the past environmental investigations and interim cleanup actions from Emhart, the barrel reconditioning company, the current owners of the peninsula portion of the Site, and other potentially responsible parties.
The Consent Decree, lodged in the U.S. District Court of Rhode Island, will be posted in the Federal Register and available for public comment for a period of 30 days. The Consent Decree can be viewed on the Justice Department website: www.justice.gov/enrd/Consent_Decrees.html.
EPA information on the Centredale Manor Superfund Site: www.epa.gov/superfund/centredale.
6 July 2018
Woman Sentenced for AssaultRead the Press Release
DAPHNE JEAN PEAHRORA, 26, of Fort Washakie, Wyoming was sentenced by Chief Federal District Court Judge Scott W. Skavdahl on July 2, 2018 for assault resulting in serious bodily injury. Peahrora was arrested in Fort Washakie, Wyoming. She received nine months of imprisonment, to be followed by thirty-six months of supervised release, and ordered to pay restitution in the amount of $33,350.45 and a $100.00 special assessment. The FBI investigated this case.
Virginia Man Sentenced for Obstructing Counterterrorism InvestigationRead the Press Release
Sean Andrew Duncan, 22, of Sterling, Virginia, was sentenced today to 20 years in prison, to be followed by a lifetime of supervised release, for obstructing a counterterrorism investigation and receipt of child pornography.
Assistant Attorney General for National Security John C. Demers, U.S. Attorney G. Zachary Terwilliger for the Eastern District of Virginia, and Assistant Director in Charge Nancy McNamara of the FBI’s Washington Field Office, made the announcement after sentencing by U.S. District Judge Leonie M. Brinkema.
According to court documents, Duncan altered, destroyed, mutilated, concealed and covered up a thumb drive and memory chip with the intent to impede and obstruct an FBI terrorism investigation. He knowingly and unlawfully received images of minors engaged in sexually explicit conduct, and possessed thousands of such images including images of infants being sexually abused. In the statement of facts, Duncan admitted to his involvement with ISIS and production of child pornography.
Obstruction of Justice
In June 2017, the FBI learned that Duncan had been in contact with an individual who had been detained in a foreign country for actively planning to travel to join ISIS. In or around February 2015, Duncan told the individual that he wanted to make “hijrah” to Syria and that he wanted her to go with him. Later in February 2016, Duncan was denied entry into Turkey and returned to the United States.
Around this same time, the individual told Duncan she was upset at work due to non-Muslim women wearing shorts that exposed their bodies. Duncan replied with a link to a website, and a message saying she could “try this.” The link contained pictures and instructions on how to make weapons and bombs. The link was to an article titled, “How to build a bomb in the kitchen of your Mom” from Inspire magazine. In December 2016, Duncan contacted the individual and told her that he had come back from Turkey, where he and his wife were deported back to the United States. Duncan said he thought the FBI was monitoring him.
In or around October 2017, law enforcement authorities of a foreign government arrested one of their citizens (Recruiter 1) for inciting rebellion. Recruiter 1 is an ISIS recruiter who is suspected of drawing foreign fighters from around the world to Recruiter 1’s home country using social media. Recruiter 1 kept names and telephone numbers of individuals who had requested to join her social media and/or communication application groups. Recruiter 1’s notes included a handwritten name appearing to be “Sean Ibn Gary Duncan,” with Duncan’s known previous phone number and known previous mobile messaging account.
On or about Oct. 6, 2017, the Allegheny County Police Department (ACPD) provided a copy of Duncan’s phone to the FBI. ACPD had obtained this copy during an investigation surrounding the recent death of Duncan’s infant child (the cause of death in the autopsy was inconclusive). The FBI’s review of Duncan’s imaged phone revealed numerous internet searches for ISIS-related material, ISIS attacks, weapons, and body armor.
On Dec. 29, 2017, FBI agents executed a search warrant at Duncan’s residence. Upon execution of the warrant, the agents knocked on the door, identified themselves as FBI, and announced that they were there to execute a search warrant. Moments before the FBI agents entered the residence through the front door, Duncan ran out the back door, barefoot, and with something clenched in his fist. FBI agents guarding the back door yelled at Duncan to stop. Before stopping, Duncan threw a plastic baggie in the air and over the heads of the agents. FBI agents recovered the baggie thrown by Duncan. The baggie was a clear plastic bag, containing a memory chip from a thumb drive that had been snapped into pieces, and placed in a liquid substance that produced frothy white bubbles. Upon searching Duncan, agents recovered a broken casing for a thumb drive from Duncan’s pants pocket.
Receipt of Child Pornography
In December 2017, Duncan possessed a smartphone containing images of pre-pubescent minors that appeared to be engaged in sexually explicit conduct with adult males. Other images on the phone were of pre-pubescent minors posed to expose their genitalia in a sexual manner. Several of the images of child pornography were screen shots that Duncan had taken of websites containing child pornography that he had visited. The pre-pubescent minors in the photos were as young as infants, and the total number of images was in the thousands.
One image on his phone consisted of Duncan’s hand exposing the genitalia of an infant in a sexual manner. Also found on several of Duncan’s phones and electronic devices were thousands of videos and images of children and women that Duncan took in a voyeuristic manner. Several of the videos and images are taken in public venues such as stores, metros, parks and restaurants.
Assistant U.S. Attorneys Gordon D. Kromberg, Colleen E. Garcia and Jay V. Prabhu of the Eastern District of Virginia, and Trial Attorneys B. Celeste Corlett, Rachel Hertz and Troy Edwards of the National Security Division’s Counterterrorism Section prosecuted this case.
Vero Beach Orthopedic Surgeon Sentenced to Life in Prison Following Conviction for Fentanyl Analog Drug Conspiracy Resulting in DeathRead the Press Release
Johnny Clyde Benjamin, Jr., M.D., 52, an orthopedic surgeon practicing in Vero Beach, Florida, was sentenced to life in prison today, after having been convicted at trial of participating in a conspiracy to possess with intent to distribute Furanyl Fentanyl which resulted in death, aiding and abetting the distribution of Furanyl Fentanyl which resulted in death, attempted possession with intent to distribute Acetyl Fentanyl, possession with intent to distribute Oxycodone, and conspiracy to possess with intent to distribute Hydrocodone and Oxycodone.
Benjamin G. Greenberg, United States Attorney for the Southern District of Florida; Adolphus P. Wright, Special Agent in Charge, Drug Enforcement Administration (DEA), Miami Field Division, Ari C. Shapira, Special Agent in Charge, Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), Miami Field Office; Peter Kuehl, Acting Special Agent in Charge, U.S. Food and Drug Administration, Office of Criminal Investigations (FDA-OCI); Mark Selby, Special Agent in Charge, U.S. Immigration and Custom Enforcement’s Homeland Security Investigations (ICE-HSI); Dave Aronberg, State Attorney, Palm Beach County State Attorney’s Office; Bruce Colton, State Attorney for the 19th Judicial Circuit; Ric Bradshaw, Sheriff, Palm Beach County Sheriff’s Office (PBSO); Deryl Loar, Sheriff, Indian River County Sheriff’s Office; and Renee Purden, Chief, Orlando Melbourne Airport Police Department, made the announcement.
U.S. District Court Judge William P. Dimitrouleas sentenced Dr. Benjamin to life in prison, to be followed by five years of supervised release and was ordered to pay restitution in the amount of $10,241.38, in addition to other counts. Dr. Benjamin was convicted by a Fort Lauderdale federal jury on April 27, 2018.
The evidence presented at the trial established that on September 1, 2016, a young woman who resided in Wellington, Florida died after overdosing on counterfeit oxycodone pills. The pills contained a Fentanyl analog, Furanyl Fentanyl, as the active ingredient. Furanyl Fentanyl is an extremely powerful synthetic opioid, many times more powerful than street level heroin or oxycodone.
Following a toxicology analysis, the Office of the District Medical Examiner of Palm Beach County attributed the cause of decedent’s death to the Furanyl Fentanyl.
An extensive investigation by law enforcement identified Dr. Benjamin as the source of the Furanyl Fentanyl pills that caused the decedent’s death. The investigation also revealed that Dr. Benjamin was involved with the manufacture and distribution of counterfeit oxycodone pills, outside the South Florida area.
This case is the result of the ongoing efforts by the Organized Crime Drug Enforcement Task Force (OCDETF) a partnership that brings together the combined expertise and unique abilities of federal, state and local law enforcement agencies. The principal mission of the OCDETF program is to identify, disrupt, dismantle and prosecute members of drug trafficking, weapons trafficking and money laundering organizations and enterprises.
Mr. Greenberg commended the investigative efforts of DEA, ATF, FDA-OCI, PBSO, HSI-ICE, Indian River County Sheriff’s Office, and Orlando Melbourne Airport Police Department. Mr. Greenberg also thanked the Palm Beach County State Attorney’s Office and State Attorney’s Office for the 19th Judicial Circuit for their assistance. This case was prosecuted by Assistant U.S. Attorneys John McMillian and Rolando Garcia.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
United States Reaches $1.53 Million Dollar Settlement with Defense Contractor to Resolve Contract ClaimRead the Press Release
Baltimore, Maryland – CACI Technologies, LLC has agreed to pay the United States $1,531,928.77 to settle an allegation that it breached its contract with the National Security Agency (NSA), a component of the Department of Defense, by billing and accepting payment from the NSA for work performed by certain CACI employees who did not meet the required qualifications.
The civil settlement was announced by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge Robert E. Craig, Jr. of the Defense Criminal Investigative Service - Mid-Atlantic Field Office; and Assistant Inspector for Investigations G. Shawn Tate, NSA Office of the Inspector General.
CACI Technologies, LLC (“CACI”), located in Chantilly, Virginia, is an information technology company that develops, integrates, and maintains technological solutions across a range of markets, including intelligence systems, communication, cyber-security, logistics and material readiness, and other services for government and commercial customers. In September 2007, CACI was awarded an NSA contract. As part of the contract, NSA required that CACI provide the resources and services of skilled professional and technical personnel necessary to meet the responsibilities specified in, or required by, Delivery Orders and/or Technical Task Orders issued under the contract. The contract and Delivery Orders referenced and attached labor categories that prescribed the type of experience and educational qualifications needed for classes of personnel billed under the particular labor category.
The United States alleged that between January 1, 2010 and June 30, 2014, certain CACI employees who provided services under the Delivery Orders issued under the Contract did not meet all the qualifications described in the labor categories corresponding to the rates billed to and paid by the NSA for those CACI employees. According to the civil settlement agreement, the settlement resolves these allegations.
As part of the settlement, CACI has already paid NSA $739,037.37, and agrees to pay an additional $792,891.40 within 30 days.
The claim resolved by this settlement is an allegation. The settlement is not an admission of liability by CACI, which cooperated in the investigation and took remedial action in the wake of the investigation, nor a concession by the United States that its claims are not well founded.
United States Attorney Robert K. Hur commended the Defense Criminal Investigative Service and NSA Office of the Inspector General for their work in this civil investigation. Mr. Hur thanked Assistant U.S. Attorney Tarra DeShields, who handled this case.
Two Defendants Convicted on All Counts for International Computer Hacking and Securities Fraud SchemeRead the Press Release
Vitaly Korchevsky, a former hedge fund manager, and Vladislav Khalupsky, a securities trader, were convicted today in federal court in Brooklyn of conspiracy to commit wire fraud, conspiracy to commit securities fraud and computer intrusion, conspiracy to commit money laundering and two counts of securities fraud in connection with their roles in an international scheme to hack into three business newswires and steal yet-to-be published press releases containing non-public financial information, which was then used to make trades that generated approximately $30 million in illegal profits. The verdicts followed a four-week trial before United States District Judge Raymond J. Dearie. When sentenced, each defendant faces a maximum of 20 years’ imprisonment.
Richard P. Donoghue, United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and Michael Breslin, Deputy Assistant Director, United States Secret Service, Office of Investigations (USSS), announced the verdict.
“The defendants teamed up with cybercriminal co-conspirators to hack pre-distribution press releases and then traded in the stock market based on that stolen information, making massive profits as a result,” stated United States Attorney Donoghue. “Today’s verdict sends a powerful message that this Office, together with our law enforcement partners, will work tirelessly to disrupt any scheme, no matter how sophisticated, that threatens the integrity and fairness of our markets.” Mr. Donoghue expressed his grateful appreciation to the United States Attorney’s Office for the District of New Jersey (USAO-DNJ), the Department of Homeland Security (DHS) and the U.S. Securities and Exchange Commission (SEC) for their significant cooperation and assistance in this case.
“Conspiring with hackers overseas, Korchevsky and Khalupsky worked swiftly to trade on stolen press releases, illegally profiting millions of dollars,” stated FBI Assistant Director-in-Charge Sweeney. “Such a massive criminal operation called for massive cover-ups, but their attempts to cover their tracks were done in vain. Devoting much time to the execution of this sneaky scheme, upon sentencing, the defendants will now rightfully face time in prison.”
“This case represents the core of the U.S. Secret Service’s commitment and strategy to aggressively pursue cyber-enabled financial criminal enterprises through our proven taskforce model of global partnerships,” stated USSS Deputy Assistant Director Breslin. “The guilty verdict delivered today represents a win for the country and for all law enforcement agencies who worked together to ensure that justice was served.”
The evidence at trial established that between February 2010 and August 2015, computer hackers based in the Ukraine gained unauthorized access into the computer networks of Marketwired L.P., PR Newswire Association LLC, and Business Wire, via a series of sophisticated cyberattacks. At one point, one of the hackers sent an online chat message in Russian to another individual stating, “hacking prnewswire.com.” The hackers moved through the computer networks and stole press releases about upcoming announcements by public companies concerning earnings, revenues and other material non-public information. Over the course of the scheme, the hackers stole more than 100,000 press releases.
In order to monetize the material non-public information in the stolen press releases, the hackers shared those stolen press releases with a network of traders, including Korchevsky and Khalupsky, via overseas computer servers controlled by the hackers and/or through secure email accounts. Once they received the stolen press releases, Korchevsky and Khalupsky generally traded ahead of the public distribution of the stolen releases. In order to execute their trades before the releases were made public, Korchevsky and Khalupsky often had to execute trades in extremely short windows of time between when the hackers illegally accessed and shared information, and when the press releases were disseminated to the public by the newswires, usually shortly after the close of the markets. As a result, the trading data often showed a flurry of trading activity around a stolen press release just prior to its public release. The defendants traded on stolen press releases containing material nonpublic information about publicly traded companies that included, among hundreds of others: Align Technology Inc.; CA Technologies; Caterpillar Inc.; Hewlett Packard; Home Depot; Panera Bread Co.; and Verisign Inc.
The illegal trading by the criminal network resulted in gains of more than $30 million, much of which was routed back to the hackers. Korchevsky traded on the stolen press releases both in accounts that benefited the criminal network as well as in his own personal accounts, and ultimately netted more than $15 million in profits over the course of the scheme. Khalupsky primarily traded in accounts that benefited the criminal network, and received a percentage of the profits he generated by trading on the stolen press releases, totaling at least $500,000 over the course of the scheme.
The evidence at trial also demonstrated that the defendants went to great lengths to conceal their roles in the criminal scheme. The conspirators used separate phones, computers and hotspots to conduct their illegal trading activity, and routinely deleted emails and/or destroyed hardware that contained evidence of their crimes. The conspirators also directed that payments received for the illegal profits they generated for the criminal network be made to offshore shell companies.
The charges against Korchevsky and Khalupsky were set forth in an indictment that was unsealed in August 2015 in connection with a broader investigation conducted by this Office, the USAO-DNJ, the FBI, the USSS and the DHS, as well as a parallel investigation by the SEC. In total, nine defendants were charged criminally for their roles in the scheme. All those defendants have either pleaded guilty or been convicted at trial except for three, who remain at large.
The government’s case is being handled by the Office’s Business and Securities Fraud Section and National Security and Cybercrime Section. Assistant United States Attorneys Richard M. Tucker, Julia Nestor and David Gopstein are in charge of the prosecution.
The Defendants:
VITALY KORCHEVSKY
Age: 53
Glen Mills, PennsylvaniaVLADISLAV KHALUPSKY
Age: 47
Brooklyn, New York and Odessa, UkraineE.D.N.Y. Docket No. 15 CR 381 (RJD)