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29 June 2018
Nashville Man Convicted of Human Trafficking CrimesRead the Press Release
Brittan Ezekiel Kettles, aka “Low Low,” 26, of Nashville, Tennessee, was convicted yesterday by a federal jury of conspiracy to sex traffic a person under the age of 14 and sex trafficking a person under the age of 14, announced U.S. Attorney Don Cochran of the Middle District of Tennessee.
According to evidence and testimony at trial, on or about June 15, 2016, Stormy Whittemore met Kettles after he contacted her through Instagram, a photo and video-sharing social networking site. Within approximately 24 hours of meeting with him, Kettles disclosed information to her regarding his prostitution enterprise. Using promises of a money, cars, mansions, and other materialistic things, Kettles recruited Whittemore into working for him as a prostitute. Shortly thereafter, Whittemore began prostituting for Kettles in the Nashville area. At the time, Whittemore was 18 years old, and prior to meeting Kettles, she had never prostituted herself before.
To facilitate Whittemore’s prostitution activities, Kettles rented a room at a motel by the Nashville International Airport from June 16, 2016, through June 19, 2016. Kettles also utilized the website www.Backpage.com to advertise her services. The advertisements on Backpage.com sometimes displayed photographs of other female individuals and sometimes of Whittemore. When a male individual, commonly referred to as a “john” responded to the advertisement, Kettles would arrange the sexual encounter between the john and Whittemore. Following the encounter, Whittemore provided the money she made to the defendant, typically between $150 and $200 for each encounter.
Between June 16 and June 19, 2016, during the same time that Kettles was prostituting Whittemore in Nashville, he met a 13-year old friend of Whittemore’s. Shortly after meeting the 13-year-old, Kettles, through Whittemore, recruited and enticed her to engage in commercial sex acts: i.e., prostitute herself in exchange for money. Over the course of the next couple of days, the 13-year-old prostituted herself on behalf of Ketttles and Whittemore. Following each sexual encounter, she provided the money she earned to Whittemore and Kettles, usually by handing the money directly to Whittemore, who would then give the money to Kettles.
During the course of the weekend, Kettles purchased clothing, food, and beverages for Whittemore and the 13-year-old female and also paid for them to receive nail services at a salon, using the money that they had earned to pay for these items and services. At the end of the weekend, Whittemore and Kettles dropped the 13-year-old off at her residence. She subsequently contacted Whittemore and Kettles via text message, asking for $200 of the $800 that she had earned for them based on the prostitution she had performed. They agreed to give her $60, but in fact only left $15 in the mailbox at her house.
Shortly after all of the above, the 13-year-old’s mother contacted a non-governmental organization and reported that her daughter had been a victim of human trafficking. The non-governmental organization reported the information to the Metropolitan Nashville Police Department, which then conducted an investigation into the allegations. The 13-year-old subsequently identified Kettles and Whittemore as the individuals who trafficked her between June 16 and June 19, 2016.
Kettles faces a mandatory minimum of at least 15 years, up to life in prison when he is sentenced on October 15, 2018. Whittemore pleaded guilty in August 2017 and is awaiting sentencing.
This case was investigated by the FBI and the Metropolitan Nashville Police Department. Assistant U.S. Attorneys Katy Risinger and Siji Moore prosecuted the case.
Munhall Drug Dealer Guilty of Trafficking Deadly FentanylRead the Press Release
PITTSBURGH – William Harvey Scott, Jr., aka "PacMan", pleaded guilty in federal court to multiple charges of violating federal narcotics laws, United States Attorney Scott W. Brady announced today.
Scott, age 27, formerly of Munhall, Pennsylvania, pleaded guilty to three felony counts before United States District Judge Cathy Bissoon.
The court was advised that Scott sold the manmade opiate fentanyl, in stamp bags marked "LIZZ" to a female on July 13, 2016 and that this woman died as a result. Law enforcement located the victim’s cellphone and determined that she had been purchasing drugs from a person she labelled as "Chris Man." Law enforcement used the victim’s phone to text "Chris Man" and asked him to meet and sell more of the drugs. When Scott appeared at the prearranged location, he was found to possess more stamp bags of fentanyl marked "LIZZ".
During his guilty plea, the defendant specifically admitted to selling the fentanyl and to causing the July 2016 death of the young woman. During the guilty plea hearing, the defendant specifically agreed to pay restitution to the victim’s family.
Judge Bissoon scheduled sentencing for October 22, 2018, at 10 a.m. The defendant was remanded to jail, pending his sentencing hearing.
Defendants charged with these types of felony drug offenses face a maximum sentence of 20 years in prison and at least six years of supervision by the United States Probation Office. The actual sentence imposed will be based upon information that includes the defendant’s criminal, family, educational and work histories.
Assistant United States Attorney Ross E. Lenhardt, a federal prosecutor with the Violent Crime and Major Crime Sections of the U.S. Attorney’s Office, is prosecuting this case on behalf of the government.
Special Agents and Task Force Officers from the Drug Enforcement Administration, and law enforcement officers from the Duquesne Police Department, Homestead Police Department, and Allegheny County Sheriff’s Office, conducted the investigation that led to the prosecution of the defendant.
United States Attorney Brady noted that the investigation was funded by the federal Organized Crime Drug Enforcement Task Force program (OCDETF). The OCDETF program supplies critical federal funding and coordination that allows federal, state, and local agencies to work together to successfully identify, investigate, and prosecute major interstate and international drug trafficking organizations and other criminal enterprises.
More Than 50 Defendants Charged in Joint Federal and State Narcotics Investigation Centered on West Side of ChicagoRead the Press Release
CHICAGO — More than 50 individuals, including a reputed gang member, are facing criminal charges as part of a joint federal and state investigation into heroin and fentanyl sales in Chicago.
The investigation, dubbed “Operation Fat Chance,” centered on drug sales on the city’s West Side and resulted in the seizures of more than three kilograms of heroin, more than a kilogram of cocaine, and more than 230 grams of fentanyl. Authorities also seized eight illegal firearms, including a semi-automatic assault rifle with a drum barrel magazine, and more than $100,000 in narcotics proceeds. As part of the investigation, law enforcement shut down two open-air drug markets in the city’s North Lawndale and East Garfield Park neighborhoods.
The probe was conducted under the umbrella of the Organized Crime Drug Enforcement Task Force (OCDETF), a partnership between federal, state and local law enforcement agencies, whose principal mission is to identify, disrupt and dismantle the most serious drug trafficking organizations.
Criminal complaints and affidavits filed in U.S. District Court in Chicago charge 15 defendants with various drug offenses. Two of the federal targets were arrested on Tuesday and several more were arrested Thursday. Detention hearings for some of the federal defendants will be held today and next week in U.S. District Court in Chicago.
Forty two other defendants were charged in state complaints, and many of them were also arrested Thursday. They have begun making initial appearances in Cook County Criminal Court.
The charges were announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; James M. Gibbons, Special Agent-in-Charge of the Chicago office of the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations; Gabriel L. Grchan, Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago; Kimberly M. Foxx, Cook County State’s Attorney; and Eddie Johnson, Superintendent of the Chicago Police Department. Substantial assistance was provided by the U.S. Marshals Service. Assistant U.S. Attorneys Nani Gilkerson and Jeannice Appenteng are representing the government.
According to the federal complaints, THOMAS BARFIELD, 36, of Chicago, is a reputed street-gang member who operated a drug trafficking organization that utilized street-level distributors (known as “pack workers”) to sell heroin and fentanyl to customers. Many of the deals were carried out at an open-air drug market near the intersection of Homan Avenue and Douglas Boulevard in Chicago, the complaints state. The sales were allegedly overseen by high-ranking members of Barfield’s organization, including CHARELLE THOMPSON, 28, of Chicago; NICOLE GREEN, 34, of Chicago; GLORIA ANDERSON, 60, of Chicago; and THOMAS SMITH, 65, of Chicago. QUIERA WALLS, 35, of Chicago, and JARVIS PAYNE, 30, or Chicago, are alleged to have assisted Barfield with the packaging and distribution of narcotics.
From December 2017 to April 2018, according to the complaints, law enforcement conducted numerous undercover drug purchases from Smith, Anderson, and the pack workers, including MICHAEL JACKSON, 44, of Chicago; ANTON BROWN, 46, of Chicago; and ALFRED JOHNSON, 54, of Chicago. Last month, agents searched Barfield’s home and three alleged stash houses on the West Side of Chicago, seizing heroin, cocaine, a rifle, two handguns, and drug-packaging materials, the complaints state.
The federal complaints also describe an April 2018 narcotics transaction in front of a grocery store in 4400 block of West Armitage Avenue in the Hermosa neighborhood of Chicago. According to the charges, JOSE HERNANDEZ, 48, of Chicago, delivered a kilogram of cocaine to OBED ORNELAS, 36, of Chicago, inside Ornelas’ Ford Mustang. When officers attempted to pull over the Mustang, Ornelas allegedly sped off and tossed the bag of cocaine out of the driver’s side window. Officers recovered the bag in the 2400 block of North Kedzie Avenue in Chicago, the complaints state. The complaints also allege that Ornelas supplied Barfield with narcotics.
Also charged in the federal complaints is another reputed gang member, WILLIE KELLEY, 26, of Chicago. Kelley allegedly managed heroin sales at an open-air drug market near the intersection of Lexington Street and Sacramento Avenue in Chicago’s East Garfield Park neighborhood.
The federal complaints also charge DARIUS FRANKLIN, 34, of Algonquin, and JONATHAN HARRIS, 26, of Cicero. According to the complaints, Franklin and Harris are alleged to have distributed heroin to various narcotics customers. Agents searched Franklin’s alleged stash house and recovered over two kilograms of heroin and drug-packaging materials. Franklin is also alleged to have provided heroin to Willie Kelley.
The public is reminded that a complaint contains only charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. If convicted, the Court must impose reasonable sentences under federal sentencing statutes and the advisory United States Sentencing Guidelines.
Moore Man Pleads Guilty to Firearm Possession by Prohibited PersonRead the Press Release
OKLAHOMA CITY – JEREMY SHAWN PARKE, 46, of Moore, Oklahoma, pleaded guilty yesterday to possession of a firearm by a prohibited person, announced Robert J. Troester, Acting United States Attorney for the Western District of Oklahoma.
According to court records, on the afternoon of May 5, 2018, the Moore Police Department received a report of shots fired in a Moore residential neighborhood. Officers made contact with a neighborhood resident who said she heard loud bangs from a nearby home. Police went to the home of Parke, where they had responded to previous incidents, and discovered a Ruger, Model AR 556 rifle and numerous spent shell casings on Parke’s back patio and in the yard. There were apparent bullet holes in his backyard fence. Officers eventually discovered a shotgun and additional rounds of ammunition inside Parke’s home.
On May 6, 2018, a Moore resident, whose home was in the adjacent neighborhood to Parke’s home, reported to the Moore Police Department that she discovered a bullet near her infant son’s crib. An officer responded to her home, where she explained that on the afternoon of May 5—at the time that the police department received a separate report of shots being fired—she heard a loud noise. She went upstairs to check on her sleeping baby. She noticed his crib railing was broken, but she thought the baby had perhaps chewed on it. The next day, however, while cleaning behind his crib, the mother noticed a bullet hole that aligned with the piece of broken crib railing. On the floor, she discovered the bullet. Law enforcement determined that it was the same caliber that could be fired from the AR 556 rifle that was seized from Parke the day before.
Parke’s possession of the firearms and ammunition was illegal because he was subject to a Cleveland County protective order that prohibited him from harassing, stalking, or threatening a former intimate partner. It also advised him that he was prohibited from possessing firearms and ammunition. According to records obtained from a local gun dealership, Parke purchased the AR 556 on March 21, 2018. When he completed the paperwork required to purchase the rifle, Parke checked "No" in answer to the question: "Are you subject to a court order restraining you from harassing, stalking, or threatening your . . . intimate partner?"
Parke was charged by criminal complaint on May 21, 2018, and arrested shortly thereafter. On June 28, 2018, he pleaded guilty to possession of a firearm by a prohibited person before United States District Court Judge Timothy D. DeGuisti. Parke remains in custody and will be sentenced in approximately 90 days.
This case is the result of an investigation by the Moore Police Department and the Bureau of Alcohol Tobacco and Firearms. Assistant U.S. Attorneys Brandon Hale and Jacquelyn Hutzell, prosecuted the case.
Reference is made to court filings for further information.
Monroe County Woman Sentenced to 2 ½ Years in Prison for Role in Heroin and Cocaine Trafficking ConspiracyRead the Press Release
SCRANTON—The United States Attorney’s Office for the Middle District of Pennsylvania announced that Shawnette Isaac, age 41, of East Stroudsburg, Pennsylvania, was sentenced to serve 30 months’ imprisonment today by Senior U.S. District Court Judge James M. Munley, for her role in a heroin and cocaine trafficking conspiracy that operated in Monroe County during 2012 through 2015.
According to United States Attorney David J. Freed, Isaac previously pleaded guilty to conspiracy to distribute heroin and cocaine. Isaac admitted to traveling to New Jersey on several occasions to obtain a total of more than 80 grams of heroin, which is equivalent to approximately 3,000 retail bags of heroin, for distribution to others in the Monroe County area. Isaac also distributed heroin for the conspiracy in Monroe County.
Isaac was one of seven defendants indicted by a federal grand jury in March 2015. Six of those defendants have entered guilty pleas, including Daryl Trent who was sentenced earlier this week to 90 months’ imprisonment by Judge Munley.
Judge Munley also ordered Isaac to serve three years on supervised release following her prison sentence.
The charges against Isaac and the other defendants resulted from an investigation by special agents of the Federal Bureau of Investigation, investigators from the Pennsylvania State Police, and local police in Monroe County. Assistant U.S. Attorney Francis P. Sempa prosecuted the case.
This case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.
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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Mobile County Man Sentenced to 240 Months in Prison for Two Carjacking Crimes, Two Possession of a Firearm During a Crime of Violence Crimes and Ordered to Pay Restitution in the Amount of $21,000.00Read the Press Release
The United States Attorney, Richard W. Moore, announces that, Jaquail Busby, a 26 year old resident of Mobile, Alabama was sentenced to 240 months of incarceration for a carjacking that occurred on January, 5 2017, a carjacking that occurred on April 13, 2017, and separate convictions for possession of a firearm in furtherance of each carjacking. He was also ordered to pay $21,000.00 in restitution to Easy Money Store located on Dauphin Island Parkway in Mobile, Alabama.
According to the factual statement Busby signed in connection with his guilty plea, on January 5, 2017, Busby took by force and threats of death the vehicle of R.W. using a firearm. Busby and an accomplice followed R.W. around Mobile in a vehicle as she traveled home from work in her Mazda. At the opportune time, Busby jumped out of the vehicle he was traveling in with a handgun after his vehicle cut in front of the Mazda. Busby beat on the window with the handgun and told R.W. to unlock the door. When she hesitated, he fired two shots into the air. R.W. then opened the door and Busby got into the back seat of the Mazda and told R.W. to drive. He continued to threaten R.W. as she drove to a local cemetery. After several hours, Busby told R.W to drive back to her place of employment - Easy Money located on Dauphin Island Parkway – because he intended to steal money from the business. R.W. complied. When they arrived at Easy Money, Busby stole approximately $21,000 from R.W. Busby then ordered R.W. to drive him to another location in Mobile and he then exited her vehicle and threw her keys away. R.W. retrieved the keys and called the police.
On April 13, 2017, Jaquail Busby and Calvin Harris devised a plan to steal money from Easy Money, a local title loan business. The plan included using an unknowing employee of the business. Later that day, J. P. (Easy Money employee/ victim) left Easy Money, located at 7740 Airport Blvd, Mobile, AL at about 9:00pm, got into her vehicle for the drive home. Unbeknownst to her, Harris and Busby were following her in Harris’ vehicle. After she had been driving about 15 minutes, Harris drove his vehicle around in front of J. P’s. vehicle and positioned it to where she had to stop or hit Harris’ vehicle. She chose to stop.
Busby then exited the vehicle and beat on her window with a firearm, telling J. P. to open the door. When she complied, Busby then told the victim to get out of the car, then ordered her back in the car, and Busby got in the rear driver side seat. Harris then sped away. As J. P. drove slowly on the city streets, Busby fired a shot out the window and told her to drive the speed limit. Busby forced J. P. to drive into an old cemetery. Busby told her to pull to the back and park facing out.
Busby then told J. P. to call her husband and tell him that she was staying with her mother. J. P. told Busby that if she called her husband, he would not believe her and Busby became angry and fired a second shot in the air. Busby then told J. P. to call her husband and tell him that she had to stay with her mother. Busby told J. P. that if she did not make the call that his associates would kill everyone there including her grandchild. Busby communicated with Harris via cell phone and told Harris to shoot anyone who came to the house. J. P. stated that throughout the night she kept praying that Busby would not kill her and tried to talk to him in an attempt to keep him calm.
At approximately 6:30am the next day, J. P. and Busby left the cemetery and drove back to Easy Money. During the drive, Busby and Harris communicated again and this time via text messages. In the text messages, Busby sought confirmation that the coast was clear to return to the business and steal the approximately $12,000 that was in the safe. Harris confirmed in return text messages that he would be positioned outside of Easy Money looking out to make sure no police were in sight. When they arrived, Busby told J. P. that they were going to sit outside until 7:00am because he knew that's what time she had to be in the store and that was 30 minutes before the timer on the safe would unlock. At 7:00am, Busby told J.P. to go inside and sit at the desk directly in front of where they parked so he could watch her.
At approximately 7:25am, J. P.’s co-worker, B. J. (the second victim) arrived at the location and was confronted by Busby who forced her inside at gunpoint and then made both of them go into the room where the safe was located. Once inside the room, Busby realized that he did not have his cellphone to communicate with Harris so he told J. P. to go get it from her vehicle. Busby told J. P. if she did anything funny he would blow B. J.’s brains out. When J. P. walked outside, a police car simultaneously pulled in the parking lot so she ran over to the vehicle and began explaining to an officer what was happening. Busby saw the police outside, and fled the scene in J. P.’s vehicle leaving the gun in his haste. A K9 Officer was dispatched to the location to track Busby. Busby was located a short time later hiding under a house. He was arrested and confessed giving written permission to search his cell phone Texts on his cell phone between he and Harris discussing the robbery and kidnapping were located. Busby pled guilty on January 25, 2018.
Officers of the Mobile, AL Police Department along with special agents of the Federal Bureau of Investigation investigated the case and presented it to the United States Attorney’s Office for prosecution. The prosecutor assigned to the case was Assistant United States Attorney, Gina S. Vann.
Mobile County Man Sentenced to 240 Months in Prison for Two Carjacking Crimes, Two Possession of a Firearm During a Crime of Violence Crimes and Ordered to Pay Restitution in the Amount of $21,000.00Read the Press Release
The United States Attorney, Richard W. Moore, announces that, Jaquail Busby, a 26 year old resident of Mobile, Alabama was sentenced to 240 months of incarceration for a carjacking that occurred on January, 5 2017, a carjacking that occurred on April 13, 2017, and separate convictions for possession of a firearm in furtherance of each carjacking. He was also ordered to pay $21,000.00 in restitution to Easy Money Store located on Dauphin Island Parkway in Mobile, Alabama.
According to the factual statement Busby signed in connection with his guilty plea, on January 5, 2017, Busby took by force and threats of death the vehicle of R.W. using a firearm. Busby and an accomplice followed R.W. around Mobile in a vehicle as she traveled home from work in her Mazda. At the opportune time, Busby jumped out of the vehicle he was traveling in with a handgun after his vehicle cut in front of the Mazda. Busby beat on the window with the handgun and told R.W. to unlock the door. When she hesitated, he fired two shots into the air. R.W. then opened the door and Busby got into the back seat of the Mazda and told R.W. to drive. He continued to threaten R.W. as she drove to a local cemetery. After several hours, Busby told R.W to drive back to her place of employment - Easy Money located on Dauphin Island Parkway – because he intended to steal money from the business. R.W. complied. When they arrived at Easy Money, Busby stole approximately $21,000 from R.W. Busby then ordered R.W. to drive him to another location in Mobile and he then exited her vehicle and threw her keys away. R.W. retrieved the keys and called the police.
On April 13, 2017, Jaquail Busby and Calvin Harris devised a plan to steal money from Easy Money, a local title loan business. The plan included using an unknowing employee of the business. Later that day, J. P. (Easy Money employee/ victim) left Easy Money, located at 7740 Airport Blvd, Mobile, AL at about 9:00pm, got into her vehicle for the drive home. Unbeknownst to her, Harris and Busby were following her in Harris’ vehicle. After she had been driving about 15 minutes, Harris drove his vehicle around in front of J. P’s. vehicle and positioned it to where she had to stop or hit Harris’ vehicle. She chose to stop.
Busby then exited the vehicle and beat on her window with a firearm, telling J. P. to open the door. When she complied, Busby then told the victim to get out of the car, then ordered her back in the car, and Busby got in the rear driver side seat. Harris then sped away. As J. P. drove slowly on the city streets, Busby fired a shot out the window and told her to drive the speed limit. Busby forced J. P. to drive into an old cemetery. Busby told her to pull to the back and park facing out.
Busby then told J. P. to call her husband and tell him that she was staying with her mother. J. P. told Busby that if she called her husband, he would not believe her and Busby became angry and fired a second shot in the air. Busby then told J. P. to call her husband and tell him that she had to stay with her mother. Busby told J. P. that if she did not make the call that his associates would kill everyone there including her grandchild. Busby communicated with Harris via cell phone and told Harris to shoot anyone who came to the house. J. P. stated that throughout the night she kept praying that Busby would not kill her and tried to talk to him in an attempt to keep him calm.
At approximately 6:30am the next day, J. P. and Busby left the cemetery and drove back to Easy Money. During the drive, Busby and Harris communicated again and this time via text messages. In the text messages, Busby sought confirmation that the coast was clear to return to the business and steal the approximately $12,000 that was in the safe. Harris confirmed in return text messages that he would be positioned outside of Easy Money looking out to make sure no police were in sight. When they arrived, Busby told J. P. that they were going to sit outside until 7:00am because he knew that's what time she had to be in the store and that was 30 minutes before the timer on the safe would unlock. At 7:00am, Busby told J.P. to go inside and sit at the desk directly in front of where they parked so he could watch her.
At approximately 7:25am, J. P.’s co-worker, B. J. (the second victim) arrived at the location and was confronted by Busby who forced her inside at gunpoint and then made both of them go into the room where the safe was located. Once inside the room, Busby realized that he did not have his cellphone to communicate with Harris so he told J. P. to go get it from her vehicle. Busby told J. P. if she did anything funny he would blow B. J.’s brains out. When J. P. walked outside, a police car simultaneously pulled in the parking lot so she ran over to the vehicle and began explaining to an officer what was happening. Busby saw the police outside, and fled the scene in J. P.’s vehicle leaving the gun in his haste. A K9 Officer was dispatched to the location to track Busby. Busby was located a short time later hiding under a house. He was arrested and confessed giving written permission to search his cell phone Texts on his cell phone between he and Harris discussing the robbery and kidnapping were located. Busby pled guilty on January 25, 2018.
Officers of the Mobile, AL Police Department along with special agents of the Federal Bureau of Investigation investigated the case and presented it to the United States Attorney’s Office for prosecution. The prosecutor assigned to the case was Assistant United States Attorney, Gina S. Vann.
Member of Drug Trafficking Organization that Distributed High Grade Marijuana Throughout New Mexico Pleads Guilty to Marijuana Trafficking and Money Laundering ChargesRead the Press Release
ALBUQUERQUE – Joaquin Alaniz, 41, of Carlsbad, N.M., pled guilty in federal court in Albuquerque, N.M., to marijuana trafficking and money laundering charges. Alaniz’s plea agreement recommends a prison sentence of 42 months followed by a period of supervised release to be determined by the court.
Alaniz is one of ten defendants charged as the result of a two-year investigation by the FBI and IRS-Criminal Investigation into a drug trafficking organization led by Enrique Cavazos, 32, of Tijeras, N.M., that distributed high-grade marijuana throughout New Mexico and across the country. The investigation revealed that the Cavazos drug trafficking organization cultivated and purchased high-grade marijuana in California, distributed the marijuana throughout the country, and laundered its drug proceeds through a number of businesses and bank accounts in New Mexico.
Alaniz, Enrique Cavazos, his wife Lindsey Cavazos, 33, his father Felix Cavazos, 59, of Albuquerque, Daniel Nieto, 40, of Carlsbad, Eliberto Nava, 36, of Madera, Calif., Antonio Ruelas, 32, of Rio Rancho, N.M., and Robert D. Moreno, 38, of Ukiah, Calif., were charged by indictment in Nov. 2015, with marijuana trafficking and money laundering offenses. The indictment charged the co-conspirators with participating in a marijuana trafficking conspiracy that existed from at least Jan. 2008 through Nov. 2015, and operated in the District of New Mexico and elsewhere.
According to court filings, Enrique Cavazos operated a marijuana trafficking business by directing his co-conspirators to purchase large quantities of marijuana in California and distribute the marijuana in New Mexico and other destinations across the country. Lindsey Cavazos was responsible for keeping the books on businesses she and her husband established with proceeds from their marijuana trafficking activities and for the purpose of laundering their drug proceeds. The couple engaged in a money laundering conspiracy and used bank accounts in the names of several of their businesses, including a restaurant and a car dealership, to launder their drug proceeds.
The indictment was superseded in Aug. 2016, to add money laundering charges against three new defendants: Steven Becerra, 62, the owner of the Becerra Group Tax and Accounting Firm in Albuquerque, who previously was employed by the IRS for 18 years; Deborah Gutierrez, 55, who operated Automated Financial Technologies, which is no longer in business; and Glen F. Lucero, 66, a retired school teacher. The superseding indictment also removed Felix Cavazos, Enrique Cavazos’s father who passed away after the original indictment was filed, from the list of defendants.
During today’s proceedings, Alaniz pled guilty to a felony information charging him with conspiracy to distribute marijuana and conspiracy to commit money laundering. In entering the guilty plea, Alaniz admitted that from at least Jan. 1, 2008 through Nov. 17, 2015, he participated in a conspiracy to cultivate, ship and sell marijuana to wholesalers and users by purchasing marijuana from Enrique Cavazos and distributing the marijuana in New Mexico for approximately a decade. Alaniz further admitted that from at least April 10, 2013 through Nov. 17, 2015, he conspired with his codefendants to launder cash proceeds from the marijuana distribution conspiracy by transferring at least $50,850 of funds derived from the illegal sale of marijuana from his bank accounts to accounts controlled by Enrique and Lindsey Cavazos. A sentencing hearing has yet to be scheduled.
Six of Alaniz’s co-defendants have entered guilty pleas, and four have been sentenced. Nieto pled guilty on May 25, 2017, and was sentenced on June 26, 2018 to 36 months in prison followed by three years of supervised release. Lindsey A. Cavazos pled guilty on May 24, 2017, and was sentenced on June 27, 2018 to five years of probation. Enrique Cavazos pled guilty on May 24, 2017, and was sentenced on May 9, 2018, to 72 months in federal prison followed by three years of supervised release. Ruelas pled guilty on Sept. 8, 2017, and was sentenced on May 2, 2018, to 30 months in federal prison followed by three years of supervised release. Navia pled guilty on May 22, 2018, and Moreno pled guilty on June 12, 2018. Sentencing hearings for Navia and Moreno are currently scheduled for Sept. 13, 2018.
The remaining three defendants, who have entered not guilty pleas to the superseding indictment, are pending trial, which is currently scheduled for July 2018. Charges in indictments are merely accusations and defendants are presumed innocent unless found guilty beyond a reasonable doubt.
The investigation of this case was designated as part of the Organized Crime Drug Enforcement Task Force (OCDETF) program, a program that combines the resources and unique expertise of federal agencies, along with their local counterparts, in a coordinated effort to disrupt and dismantle major drug trafficking organizations. It was conducted by the Albuquerque offices of the FBI and IRS Criminal Investigation and the Albuquerque Police Department. Assistant U.S. Attorneys Jennifer M. Rozzoni, Timothy S. Vasquez and Joel R. Meyers are prosecuting the case, and Assistant U.S. Attorney Stephen R. Kotz is handling the forfeiture matters.
Massachusetts Man Pleads Guilty to Conspiracy to Distribute FentanylRead the Press Release
CONCORD - Juan Garcia, 34, of Roxbury, Massachusetts, pleaded guilty on Thursday in federal court to conspiracy to distribute fentanyl, United States Attorney Scott W. Murray announced today.
According to court documents and statements made in court, in early 2016, the FBI received information regarding a drug dealer known as “Tony,” who was distributing drugs in Nashua and elsewhere. “Tony” was later identified as the defendant, who has used multiple names, including Juan Garcia. In February and March of 2016, the FBI used a cooperating individual to buy over 40 grams of fentanyl from the defendant and his associates in Lawrence, Massachusetts. The defendant was subsequently arrested in April 2017.
Garcia is scheduled to be sentenced on October 10, 2018.
“Fentanyl trafficking poses a grave danger to the health and safety of our citizens,” said U.S. Attorney Murray. “In order to protect the public, we will aggressively target and prosecute those who are distributing this lethal drug in the Granite State.”
"This defendant had no regard for the people to whom he peddled his poison, and the FBI Safe Streets Gang Task Force will continue to do work with our law enforcement partners to do everything it can to put a stop to drug dealers like him in an effort to make our communities safer, " said Harold H. Shaw, Special Agent in Charge of the FBI Boston Division
This matter was investigated by the FBI New Hampshire Safe Streets Gang Task Force, which is comprised of the FBI, the New Hampshire State Police, New Hampshire Probation and Parole, and the Police Departments of Hudson, Manchester, and Nashua. Assistance was provided by the FBI North Shore Gang Task Force. The case is being prosecuted by Assistant U.S. Attorney Shane Kelbley and First Assistant U.S. Attorney John J. Farley.
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Maryland Woman Indicted for Alien Harboring and Withholding Immigration Documents to Maintain Labor and Services of Zimbabwean NationalRead the Press Release
An indictment was unsealed today in the U.S. District Court of Maryland charging Shingaizdo Nhekairo, 49, of Arnold, Maryland, with one count of alien harboring for financial gain and one count of unlawful conduct with respect to immigration documents. The indictment was announced by Acting Assistant Attorney General John Gore of the Justice Department’s Civil Rights Division and U.S. Attorney Robert K. Hur.
According to the indictment, between 2006 and 2014, the defendant harbored the victim, a national of Zimbabwe. The indictment further alleges that the defendant concealed the victim’s immigration status for purposes of financial gain and confiscated the victim’s passport to maintain her labor and services.
An indictment is merely an accusation, and the defendant is presumed innocent unless proven guilty. If convicted of alien harboring, the defendant faces a maximum sentence of 10 years in prison. The crime of unlawful conduct with respect to immigration documents carries a maximum sentence of one year in prison and requires mandatory restitution.
The case is being investigated by the U.S. Immigration and Customs Enforcement’s Homeland Security Investigations Baltimore Division, with assistance from the Department of Labor’s Wage and Hour Division. It is being prosecuted by Assistant United States Attorney Ayn Ducao of the District of Maryland and Trial Attorneys Vasantha Rao and Emily Savner of the Civil Rights Division’s Human Trafficking Prosecution Unit.
Maplewood, New Jersey, Man Indicted on New Counts for Alleged Phony Debt Elimination SchemeRead the Press Release
Daniel K. Dxrams, 39, of Maplewood, New Jersey, was indicted today on one count of conspiracy to commit mail fraud and nine substance counts of mail fraud in connection with an alleged debt elimination scheme to unlawfully discharge his obligations for a Rolls Royce, a Bentley and two Mercedes Benz vehicles. He was originally charged by complaint with one count of conspiracy to commit mail fraud when he was arrested with four other individuals who allegedly used phony money orders, cashier’s checks, receipts and other fabricated documents to fraudulently discharge mortgages, student loans, and other financial obligations, as described in the press release of March 20, 2018.
Manchester Man Pleads Guilty to Scheme to Defraud State of New Hampshire in Connection with Untaxed Tobacco ProductsRead the Press Release
CONCORD – United States Attorney Scott W. Murray announced today that Imtiaz Shaikh, 46, of Manchester pleaded guilty to one count of wire fraud in connection with a scheme to defraud the State of New Hampshire.
According to court documents and statements made in court, Shaikh’s scheme involved the purchase of tobacco products other than cigarettes, referred to as “other tobacco products” or “OTP,” from various suppliers located in Pennsylvania. Shaikh and others then transported the products to New Hampshire for sale to retail businesses. In New Hampshire, wholesale distributors of OTP must be licensed and are required to file reports identifying the quantity of OTP sold each month. During the period of the scheme identified in the charging document, New Hampshire taxed OTP at 65.03 percent of the wholesale sales price. Shaikh avoided most of the licensing and reporting requirements by conducting business through a number of shell corporations. Except for a single report filed in September 2014, Shaikh and the entities he created failed to pay the taxes owed to the State of New Hampshire. The state lost an estimated $1.5 million in tax revenue as a result of the scheme.
A sentencing hearing has been scheduled for October 16, 2018.
“Although no one likes to pay taxes, we all are required to follow the law,” said U.S. Attorney Murray. “This defendant’s fraud scheme deprived the state of lawful tax revenue in order to enhance his personal income. Those who choose to engage in schemes like this should understand that we are committed to the aggressive prosecution of individuals who engage in fraudulent conduct.”
“The guilty plea entered today by Mr. Shaikh brings an end to his elaborate scheme to avoid paying taxes through the sale and distribution of tobacco products. The state of New Hampshire and its taxpayers are the really the ones who have suffered the consequences of his actions. The FBI is committed to working with our law enforcement partners to stop this type of criminal activity, and make sure the taxpayers are made whole,” said Harold H. Shaw, Special Agent in Charge, FBI Boston Division.
Mr. Shaikh’s tax evasion scheme increased the burden on New Hampshire’s law-abiding citizens, forcing them to make up the difference,” said Kristina O’Connell, Special Agent in Charge, IRS Criminal Investigation, Boston. "Today, honest taxpayers have been reassured that no one is above the law. We will continue to collaborate with our law enforcement partners on these important investigations to protect the integrity of the American tax system."
The Federal Bureau of Investigation, the IRS Criminal Investigation, Boston, the New Hampshire State Police, the Manchester Police Department, the Salem New Hampshire Police Department, the Massachusetts State Police and the New Hampshire Department of Revenue Administration all participated in the investigation of this case. Assistant United States Attorney Donald A. Feith prosecuted the case.
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Man Illegally Residing in Lexington Sentenced to Nearly 30 Years for Drug Trafficking, Firearms, and Immigration OffensesRead the Press Release
LEXINGTON, Ky. – Fernando Rafael Lara Salas, age 40, who had previously used the aliases of Jesus Ruiz Vega, Francisco Garcia and Cristobal Palacios Garcia, was sentenced today, to 353 months in prison, by U.S. District Judge Danny C. Reeves. In January, Lara Salas was tried and convicted of multiple offenses, including drug trafficking, firearms and immigration offenses. His drug trafficking convictions included conspiracy to distribute more than five kilograms of cocaine, possession with intent to distribute more than five kilograms of cocaine, and possession with intent to distribute fentanyl, methamphetamine, and tramadol. Lara Salas’ firearms convictions included possession of a firearm in furtherance of a drug-trafficking crime, possession of a firearm as a convicted felon, and possession of a firearm by an alien. Lara Salas was also convicted of unlawfully re-entering the United States after previously being deported for a felony drug offense.
Two co-defendants in the case, Jorge De Jesus Macias Pedroza and Nestor Barron, were also convicted and previously sentenced by Judge Reeves, to terms respective terms of imprisonment of 188 and 120 months. All three men will be required to serve 85% of their sentences.
The joint investigation by federal and state law enforcement into the drug trafficking activities of Lara Salas began in August 2016 and culminated with the execution of search warrants at Lara Salas’ residence in Lexington and a cargo trailer located in a remote location in Franklin County. The search of Lara Salas’ home resulted in the seizure of 6 kilograms of cocaine, more than 50 grams of methamphetamine, a 9 mm firearm and $110,000 in U.S. currency. Evidence found in the cargo trailer revealed that Lara Salas and others utilized the trailer for the preparation of fentanyl for distribution. Agents located packaging material consistent with a kilogram quantity of a controlled substance. The packaging contained a residual amount of fentanyl, an extremely potent opioid. Also located in the trailer were five kilograms of tramadol, a Schedule IV controlled substance that is commonly used by drug traffickers as a cutting agent for fentanyl and heroin, and boxes of latex gloves. The investigation was a cooperative effort led by investigators with the Drug Enforcement Administration (DEA); the Department of Homeland Security, Immigration and Customs Enforcement (ICE); and the Lexington Police Department.
“Without the outstanding work of our law enforcements partners, this prosecution would not have been possible. Their efforts removed dangerous drugs from our streets, made our community safer, and saved lives. Prosecuting those who sell drugs in our community will continue to be a core priority of our Office,” said Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky.
United States Attorney Duncan; Darrell Christopher Evans, Special Agent in Charge, DEA Louisville; Kristoffer Cortex, Acting Assistant Field Office Director, ICE; and Lawrence Weathers, Chief of Police, Lexington-Fayette County Division of Police, jointly announced the sentence.
Man Arrested for Threatening to Murder Family of FCC ChairmanRead the Press Release
ALEXANDRIA, Va. – A California man was arrested today in Los Angeles on charges of threatening to kill the family of Ajit Pai, Chairman of the Federal Communications Commission, for Pai’s role in repealing regulations relating to net neutrality.
According to court documents, on or about Dec. 19 and 20, 2017, Markara Man, 33, of Norwalk, allegedly sent three emails to Chairman Pai’s email accounts. The first email accused Chairman Pai of being responsible for a child who allegedly had committed suicide because of the repeal of net neutrality regulations. The second email listed three locations in or around Arlington, and threatened to kill the Chairman’s family members. The third email had no message in its body, but included an image depicting Chairman Pai and, in the foreground and slightly out of focus, a framed photograph of Chairman Pai and his family. The FBI traced the emails to Man’s residence in Norwalk, California, and when initially confronted in May 2018, Man admitted to the FBI that he sent the email threatening Chairman Pai’s family because he was “angry” about the repeal of the net neutrality regulations and wanted to “scare” Chairman Pai.
Man is charged with a threatening to murder a member of the immediate family of a U.S. official with the intent to intimidate or interfere with such official while engaged in the performance of official duties, or with the intent to retaliate against such official on account of the performance of official duties. If convicted, Man faces a maximum penalty of 10 years in prison. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia, and Nancy McNamara, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement. Assistant U.S. Attorney Alexander P. Berrang is prosecuting the case.
The FBI’s Los Angeles Field Office, the Federal Protective Service, and the Arlington County Police Department provided significant assistance in this investigation.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:18-mj-289.
Lower Brule Woman Sentenced for AssaultRead the Press Release
United States Attorney Ron Parsons announced that a Lower Brule, South Dakota, man convicted of Assaulting, Resisting, and Impeding a Federal Officer was sentenced on June 27, 2018, by U.S. District Judge Roberto A. Lange.
Megan Crazy Bull, age 22, was sentenced to 24 months in federal prison, followed by 3 years of supervised release, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Crazy Bull was indicted by a federal grand jury on February 14, 2018. She pled guilty on April 19, 2018.
The conviction stems from an incident on November 10, 2017, when while an inmate in the Lower Brule Detention Center, Megan Crazy Bull, began to act out in her cell. When correctional officers went to her cell to have her calm down, they observed she was holding a pencil over her head “like a knife” and shouting she was going to harm herself. Officers opened the door and Crazy Bull dropped the pencil and climbed up on her bunk. Officers ordered her to come down off the bunk and exit her cell, but she refused to do so and a restraint chair was brought outside the cell. Correctional officers entered the cell in order to remove her and place her in the restraint chair, at which point Crazy Bull stiffened up and began to actively resist the officers. During the struggle, she began to spit and kick at the officers. She was eventually secured in the chair and a spit hood was placed on her before being placed back in her cell.
This case was investigated by the Bureau of Indian Affairs, Lower Brule Agency. Assistant U.S. Attorney Troy R. Morley prosecuted the case.
Crazy Bull was immediately turned over to the custody of the U.S. Marshals Service.
Lincoln Man Sentenced for Production, Receipt and Distribution of Child PornographyRead the Press Release
United States Attorney Joe Kelly announced that Kenneth Joseph Jacobsen, 44, formerly of Lincoln, Nebraska, was sentenced today in Lincoln, Nebraska, to 30 years in prison by United States District Judge John M. Gerrard, for the production, distribution and receipt of child pornography. In addition to his prison sentence, Jacobsen will serve 20 years on supervised release and be required to register as a sex offender. Jacobsen was also ordered to pay $1,000 in restitution to his victims.
In December, 2016, Homeland Security Investigations (HSI) received a request from an agent in Boston asking for assistance in identifying victims of child sexual abuse believed to reside in Lincoln, Nebraska. Upon a review of the images provided and additional investigation by law enforcement, investigators of the Lincoln Police Department and HSI were led to the residence of Jacobsen, and in December, 2016, executed a search warrant at Jacobsen’s residence. When interviewed, Jacobsen admitted to taking sexually explicit digital videos and images of minor children, including prepubescent minors, and posting those pictures, through emails and internet-based web services. He also admitted to possessing images of child porn.
Forensic examination of items of computer storage media found at Jacobsen’s residence uncovered approximately 16,374 images and approximately 1,444 videos of child pornography, including images of prepubescent minors engaged in sexually explicit conduct. Of that number, approximately 1,918 images and 125 videos appear to have been produced by the Defendant. Of the videos produced by the Defendant, seven of the eleven victims have been identified from the investigation. Investigation also determined that the Defendant used the Internet, a means and facility of interstate and foreign commerce, to receive and distribute images of child pornography.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case was investigated by the Department of Homeland Security and the Lincoln Police Department.
Lexington Man Sentenced to 15 Years for Trafficking in Fentanyl and Possession of a Firearm in Furtherance of Drug TraffickingRead the Press Release
LEXINGTON, Ky.— Melvin Tremayne Mahone, 31, of Lexington, was sentenced to 15 years in federal prison by Chief United States District Judge Karen Caldwell for Trafficking in more than 40 grams of Fentanyl and Possession of Firearms in Furtherance of Drug Trafficking.
On October 20, 2016, a search warrant was executed at Mahone’s residence, on American Avenue in Lexington. During the arrest and search of Mahone, officers located approximately 60 grams of fentanyl concealed in his underwear. Fentanyl can be lethal in the 2 milligram range. In close proximity to Mahone were two loaded firearms. Mahone has a prior federal felony conviction for drug trafficking. Mahone pleaded guilty to the charges in March.
Under federal law, Mahone must serve 85 percent of his prison sentence; and upon his release, he will be under the supervision of the United States Probation Office for 8 years.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Stuart Lowery, Special Agent in Charge, ATF; and Lawrence Weathers, Chief of the Lexington Police Department, jointly announced the sentence.
The investigation was conducted by the Lexington Police Department and the ATF. The United States was represented by Assistant United States Attorney Roger W. West.
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 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, local strategies to reduce violent crime.
Kyle Man Found Guilty of Assault on a Federal OfficerRead the Press Release
United States Attorney Ron Parsons announced that Ramone McBride, age 20, was found guilty of Assault on a Federal Officer following a federal trial in Rapid City, South Dakota.
The charge carries a maximum sentence of 8 years in federal prison, and/or a $250,000 fine, followed by 3 years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
Evidence at trial established McBride assaulted a law enforcement officer employed by the Oglala Sioux Tribe Department of Public Safety on September 4, 2017, by punching and tasing him with a taser.
This case was investigated by the Oglala Sioux Tribe Department of Public Safety and the Federal Bureau of Investigation. Assistant U.S. Attorney Megan Poppen prosecuted and tried the case.
A sentencing date was set for October 3, 2018. McBride was remanded to the custody of the U.S. Marshals Service pending sentencing.
Justice Department Update on Hate Crimes ProsecutionsRead the Press Release
Today, on the one year anniversary of the Justice Department’s 2017 Hate Crimes Summit, the Department announced an update on hate crimes prosecutions under the Civil Rights Division’s Criminal Section. The Department is committed to enforcing federal hate crimes statutes, which allow the Department to prosecute certain crimes that are committed because of the actual or perceived race, color, religion, national origin, gender, sexual orientation, gender identity, or disability of any person. In recent years, the Department has ramped up its prosecutions of hate crimes and increased training of federal, state, and local law enforcement officers to ensure that hate crimes are identified and prosecuted to the fullest extent possible.
Over the past 10 years, the Department of Justice has charged more than 200 defendants with hate crimes offenses. The Matthew Shepard and James Byrd, Jr., Hate Crimes Prevention Act of 2009 (HCPA) provided a valuable new tool in this effort. The Department has used the HCPA to indict 88 defendants in 42 hate crimes cases with 64 convictions to date. In FY 2016, the Department charged 27 defendants in 18 cases, obtaining 16 convictions. Since January 2017, the Department has indicted 32 defendants involved in committing hate crimes and secured convictions of 32 defendants for hate crimes incidents.
“Individuals should be able to live their lives free from the threat of violence and discrimination, no matter who they are, what they believe, or how they worship,” said Acting Assistant Attorney General John Gore. “I am proud of the work that the Civil Rights Division has already accomplished, and we will continue to work diligently to bring to justice perpetrators of hate crimes across the country.”
Hate crimes prosecutions from January 2017 to present:
- Racial Hate Crimes
- Eight indictments and 14 convictions
- Religious Hate Crimes
- Eight indictments and seven convictions in cases involving arson or other physical attacks, or conspiracy or threats to commit such attacks against places of worship;
- Seven indictments and five convictions in cases involving other hate crimes based on religion.
- Sexual Orientation Hate Crimes
- Six indictments and six convictions
- Other (Gender Identity Hate Crimes)
- One sentence;
- One indictment, one conviction in state court with a federal prosecutor cross-designated as a state prosecutor.
Based on the FBI’s latest Uniform Crime Statistics Report, issued in November 2017 for calendar year 2016, there were 6,063 single-bias incidents reported involving 7,227 offenses, 7,509 victims, and 5,727 known offenders, and 58 multiple-bias incidents reported involving 94 offenses, 106 victims, and 43 known offenders.
The Department has created and launched a number of training and outreach programs in order to work with the network of U.S. Attorney’s Offices, local communities and organizations, and law enforcement to find, identify, investigate, and prosecute hate crimes cases all over the country. These programs include state and local law enforcement trainings, roundtable and panel discussions, stakeholder telephone conferences, and hate crime summits.
More information about the Justice Department’s hate crimes enforcement efforts can be found at https://www.justice.gov/crt/hate-crimes-0.
- Racial Hate Crimes
Investiture Ceremony Held for United States Attorney William M. McSwainRead the Press Release
PHILADELPHIA – At a formal investiture ceremony held today at the James A. Byrne United States Courthouse, U.S. Attorney William M. McSwain took the Oath of Office as the 39th United States Attorney for the Eastern District of Pennsylvania. Mr. McSwain was nominated by President Donald Trump on December 20, 2017, and unanimously confirmed by the United States Senate on March 20, 2018; he assumed office on April 6, 2018.
The Ceremonial Courtroom was filled to capacity with Mr. McSwain’s family, friends, and colleagues, as well as dignitaries from federal, state, and local government. Chief U.S. District Judge Lawrence F. Stengel presided over the proceedings. Guest speakers included Senator Patrick J. Toomey and Senator Robert P. Casey, Jr., both having recommended Mr. McSwain for the post; John J. Soroko, Esq., Chairman Emeritus, Duane Morris, LLP; Samuel G. Williamson, Esq., of Quinn Emanuel Urquhart & Sullivan, LLP; and the Honorable Marjorie O. Rendell, Senior United States Circuit Judge, U.S. Court of Appeals for the Third Circuit. Reverend William Golderer, President and CEO of the United Way of Greater Philadelphia, provided the invocation. After the guests provided remarks, Judge Rendell administered the Oath of Office to her former law clerk Mr. McSwain, who gave concluding remarks.
The speakers highlighted the solemnity of the Office Mr. McSwain has undertaken and the wealth of experience he brings to bear as he assumes the role of the region’s top prosecutor for one of the nation’s largest districts. As Senator Toomey observed, “Bill McSwain will make an outstanding U.S. Attorney for the Eastern District of Pennsylvania. In addition to his vast experience in both the private and public sectors, he is committed to the rule of law and dedicated to ensuring everyone is treated fairly under it.”
“I congratulate Mr. McSwain and his family on his investiture, and I commend him for his willingness to serve,” remarked Senator Casey. “U.S. Attorneys play a vital role in the fair, independent administration of justice in this country, and Pennsylvania will benefit from Mr. McSwain’s extensive legal and prosecutorial experience.”
As Mr. Soroko remarked, “How fortunate for the cause of justice and the rule of law that the arc of Bill McSwain’s career has now brought him back to the Office.”
Over the last 18 years, Mr. McSwain has built a diverse trial practice. Most recently, Mr. McSwain was a partner at the law firm of Drinker Biddle & Reath in its Philadelphia office, specializing in white collar criminal matters and complex business litigation. He previously served as an Assistant U.S. Attorney in the Criminal Division in the Office he now leads; while there, he was specially assigned to the Department of Defense in 2004 to be the lead staff investigator and Executive Editor of the “Church Report,” a worldwide examination of military interrogation techniques in the Global War on Terror, commissioned by Secretary of Defense Donald Rumsfeld and chaired by Vice Admiral Albert Church. Before his first tour of duty in the U.S. Attorney’s Office, Mr. McSwain began his legal career as a law clerk to Judge Rendell.
During his time in private practice, Mr. McSwain frequently volunteered his services in support of constitutional rights, often winning long-shot cases of national significance. For example, in Intel Corporation v. Hamidi, the California Supreme Court established the legal rules for trespass liability on the Internet, ruling in favor of Mr. McSwain’s client, Mr. Kenneth Hamidi. In Freethought Society v. County of Chester, PA, the U.S. Court of Appeals for the Third Circuit ruled that an historic plaque of the Ten Commandments could remain on the façade of the Chester County Courthouse, finding in favor of the County, Mr. McSwain’s client. And in Cradle of Liberty, Boy Scouts of America v. City of Philadelphia, the jury returned a verdict in favor of Mr. McSwain’s client, the Boy Scouts, which allowed the Scouts to remain in their historic headquarters building in Philadelphia.
Having worked with Mr. McSwain at the outset of his legal career, Judge Rendell offered a unique perspective on his capabilities to lead the Office: “I know Bill McSwain will lead the U.S. Attorney’s Office with same brilliance, balance, and professionalism that he has shown in his legal career to date. Once a terrific law clerk for me, he will surely be a terrific United States attorney for the people of our region.”
Prior to becoming an attorney, Mr. McSwain served as an infantry officer and scout/sniper platoon commander in the United States Marine Corps. In 1996, he deployed to the Persian Gulf region with the 13th Marine Expeditionary Unit (Special Operations Capable). While on deployment, he received the Navy Achievement Medal for joint operations with snipers from the Royal Jordanian Army. Mr. McSwain received the General William E. Potts award as the class honor graduate of the intelligence officer course at Fort Huachuca, AZ and was also an honor graduate of USMC Officer Candidates School and The Basic School in Quantico, VA.
Mr. McSwain was the 1987 class valedictorian of Henderson High School in West Chester, PA. He earned a B.A. in Economics, with honors, from Yale University in 1991. He earned his J.D. from the Harvard Law School in 2000, where he served as an editor of the Harvard Law Review. While at Harvard, he was a member of the winning team in the Ames Moot Court competition and received the George S. Leisure award as the Best Oralist in the Ames competition.
Mr. McSwain was raised in West Chester and resides there today with his wife, Stephanie, and their four children, Connor, Brady, Nancy, and Billy. He is the first Chester County native to hold the position of U.S. Attorney for the Eastern District of Pennsylvania.
“The Oath I took today reaffirms my commitment to the cause of justice for the people in the Eastern District,” McSwain commented. “It is the same Oath every Assistant United States Attorney in my Office takes on the first day on the job. And in that sense, we fully commit ourselves together to keep our communities safe.”
Houston Pharmacist Sentenced to Federal Prison for Role in Multi-Million Dollar Health Care Fraud SchemeRead the Press Release
In Austin today, Nermin Awad El-Hadik, 42-year-old owner of Hope Pharmacy, Inc., in Houston, was sentenced to five years in federal prison for paying kickbacks in a health care fraud scheme.
That announcement was made by United States Attorney John F. Bash; Special Agent in Charge Christopher Cave, U.S. Postal Service Office of Inspector General (USPS OIG), Southern Area Field Office; Special Agent in Charge Steven Grell, Department of Labor Office of Inspector General (DOL OIG), Dallas Region; and, Special Agent in Charge Christopher Combs, Federal Bureau of Investigation (FBI), San Antonio Division.
In addition to the prison term, United States District Judge Sam Sparks ordered that the defendant pay $5,334,303.04 restitution to the DOL and be placed on supervised release for a period of three years after completing her prison term.
“The sentence imposed today should send a clear message that these crimes will not be tolerated,” said USPS OIG Special Agent in Charge Cave. “The USPS Office of Inspector General, along with our law enforcement partners, will continue to aggressively pursue these investigations in order to ensure the protection of the Postal Service and federal benefits programs.”
“Nermin Awad El-Hadik fraudulently paid more than $5.3 million to a medical provider in a kickback scheme in exchange for referrals of injured employees covered by the DOL Federal Employees’ Compensation Act. We will continue to work with our law enforcement partners and DOL’s Office of Workers’ Compensation Programs to protect the integrity of DOL benefits programs,” said DOL OIG Special Agent in Charge Grell.
“Rooting out health care fraud is central to the well-being of both our citizens and the overall economy. Health care fraud costs the country billions of dollars a year, and the FBI seeks to identify and pursue investigations against the most egregious offenders involved in health care fraud through investigative partnerships with other federal agencies,” said FBI Special Agent in Charge Combs.
On November 9, 2016, the Houston resident pleaded guilty to a one count Information charging her with willful offer and payment of illegal remuneration in relation to a federal health care program. By pleading guilty, El-Hadik admitted that from March 2015 to December 2015, she paid kickbacks to Garry Wayne Craighead. Craighead, a chiropractor, organized and controlled multiple health care related entities, including eight clinics in Texas (Dallas, Fort Worth, Killeen, Austin, San Antonio, Corpus Christi, Weslaco, and Beaumont), that derived substantial revenue from DOL health care benefit programs. El-Hadik paid Craighead cash for patient referrals of federally-insured employees in need of prescription services; and, for his influence in encouraging physicians to prescribe compounded medications for patients, which would then be furnished at Hope Pharmacy.
On December 4, 2015, Craighead pleaded guilty to one count of solicitation and receipt of illegal remunerations in federal health care programs and one count of engaging in monetary transactions in property derived from specified unlawful activity. On June 10, 2016, Craighead was sentenced to 14 years in federal prison and ordered to pay over $17 million restitution to the U.S. Department of Labor.
The U.S. Postal Service Office of the Inspector General, U.S. Army Criminal Investigation Command’s Major Procurement Fraud Unit, Federal Bureau of Investigation, Internal Revenue Service-Criminal Investigation, and the U.S. Department of Labor Office of the Inspector General conducted this investigation. Assistant U.S. Attorneys James Blankinship and Mark Marshall are prosecuting this case for the government.
Hillsboro Man Sentenced to More Than 15 Years in Federal Prison for Distribution of Methamphetamine and CockfightingRead the Press Release
Downloadable file: SENTENCING-Ramirez-Final.pdf
PORTLAND, Ore. – On June 28, 2018, Daniel Ramirez, 43, of Hillsboro, Oregon, was sentenced to 188 months in prison for engaging in a conspiracy to distribute methamphetamine and engaging in cockfighting. Ramirez was also ordered to pay a money judgment of $100,000 and will be on supervised release for five years upon completion of his prison sentence.
According to court documents, Ramirez was the leader of a large drug trafficking organization with ties to multiple Mexican drug cartels, including Los Caballeros Templarios (Knights Templar), and was responsible for smuggling significant quantities of methamphetamine from Mexico into Oregon and elsewhere. With the assistance of a series of court authorized wiretaps, law enforcement agents identified more than 50 members of the organization, 35 of whom reside in Oregon. 24 members were indicted in federal court on various drug-related charges. A number of additional defendants were also charged in state court.
On October 15, 2015, and interagency team of law enforcement officers conducted one of the largest takedowns in Oregon history, executing federal search warrants throughout the Portland and Salem, Oregon metro areas. Ramirez was arrested at his home in Hillsboro. During a search of his residence, agents found four firearms and ammunition. After his arrest, Ramirez admitted to receiving between five and ten pounds of methamphetamine every two-to-three weeks from suppliers in Mexico.
While investigating the drug trafficking operation, agents also discovered that Ramirez was heavily involved in cockfighting. He would obtain roosters, attach knives and gaffs to their legs and enter them into wagered fights throughout Oregon.
Ramirez previously pleaded guilty to one count of conspiracy to distribute and possession with intent to distribute methamphetamine and one count of conspiracy to violate the Animal Welfare Act on November 27, 2017.
This case was investigated by the Westside Interagency Narcotics (WIN) team and the FBI. It was prosecuted by Scott M. Kerin, Assistant U.S. Attorney for the District of Oregon.
This case was brought as part of the Justice Department’s Organized Crime and Drug Enforcement Task Force (OCDETF) program, the centerpiece of the department’s strategy for reducing the availability of drugs in the U.S. OCDETF was established in 1982 to mount a comprehensive attack on drug trafficking by disrupting and dismantling major drug trafficking and money laundering organizations. Today, OCDETF combines the resources and expertise of its member federal agencies in coordination with state and local law enforcement.
Hazleton Man Sentenced to 33 Months in Prison for Heroin TraffickingRead the Press Release
SCRANTON—The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Antonio Perez, age 46, of Hazleton, was sentenced to 33 months’ imprisonment and three years on supervised release on June 28, 2018, by U.S. District Court Judge Malachy E. Mannion for distributing heroin.
According to United States Attorney David J. Freed, Perez previously admitted to selling heroin to another person on July 2, 2014, in Hazleton. Perez sold slightly less than 100 grams of heroin, which is equivalent to just under 4,000 retail bags of heroin.
Perez was indicted by a grand jury in October 2014, following an investigation by the Federal Bureau of Investigation and the Scranton Police Department. Assistant U.S. Attorney Francis P. Sempa prosecuted the case.
This case was brought as part of a district wide initiative to combat the nationwide epidemic regarding the use and distribution of heroin. Led by the United States Attorney’s Office, the Heroin Initiative targets heroin traffickers operating in the Middle District of Pennsylvania and is part of a coordinated effort among federal, state and local law enforcement agencies to locate, apprehend, and prosecute individuals who commit heroin related offenses.
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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Hartford Man Sentenced to 46 Months for Distributing Heroin and Fentanyl Involved in Norwich OverdoseRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that FELIX LOPEZ, also known as “Pablo,” 23, of Hartford, was sentenced today by Chief U.S. District Judge Janet C. Hall in New Haven to 46 months of imprisonment, followed by five years of supervised release for distributing narcotics to a Norwich overdose victim last year.
This matter stems from an ongoing statewide initiative targeting narcotics dealers who distribute heroin, fentanyl or opioids that cause death or serious injury to users.
According to court documents and statements made in court, on September 13, 2017, Norwich Police and emergency medical personnel responded to a report of an untimely death at a residence in Norwich. Responding officers were informed that the decedent, a 20-year-old woman, had an addiction to heroin. At the scene, officers seized drug and non-drug evidence, including the victim’s cell phone.
The State of Connecticut Office of the Chief Medical Examiner subsequently determined that the victim died from acute fentanyl and heroin intoxication.
The investigation revealed that LOPEZ had sold narcotics in and around Hartford since at least January 2016, and that he supplied heroin and fentanyl consumed by the victim shortly before the victim died.
LOPEZ was arrested on a federal criminal complaint on November 13, 2017. At the time of his arrest, he possessed a quantity of crack cocaine.
LOPEZ has been detained since his arrest. On April 5, 2018, he pleaded guilty to one count of possession with intent to distribute, and distribution of, heroin, cocaine base (“crack cocaine”) and fentanyl.
This matter was investigated by the Drug Enforcement Administration and the Norwich, Hartford and Manchester Police Departments. The case was prosecuted by Assistant U.S. Attorney John T. Pierpont, Jr.
Hamden Restaurant to Make Changes to Comply with Americans with Disabilities ActRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, today announced that the U.S. Attorney’s Office has reached settlement agreements with Ibiza Restaurant (“Ibiza”) and Mangos, LLC (“Mangos”) in Hamden, to resolve allegations that Ibiza was not operating in compliance with the Americans with Disabilities Act of 1990 (“ADA”). Ibiza leases its premises from Mangos.
The settlement agreements resolve an ADA complaint filed by an individual with physical disabilities alleging that Ibiza did not meet the ADA’s requirements for accessibility. Ibiza and Mangos are in the process of making the changes to the physical premises of Ibiza as required by the settlement agreements. Mangos has committed to increasing accessible parking for Ibiza and its other commercial tenant, remediating the sidewalk from the parking area to the tenant business entrances, adding a ramp from the sidewalk to the tenant business entrances and ensuring that the tenant business entrances are accessible. Ibiza has committed to increasing accessibility in the interior of the restaurant, including constructing an accessible restroom. Mangos will continue to make improvements over the next year and Ibiza will make improvements over the next 18 months.
Under federal law, private entities that own or operate places of “public accommodation,” including restaurants, are prohibited from discriminating on the basis of disability. The ADA authorizes the U.S. Department of Justice to investigate complaints and undertake periodic reviews of compliance of covered entities. The Justice Department also is authorized to commence a civil lawsuit in federal court in any case that involves a pattern or practice of discrimination or that raises issues of general public importance, and to seek injunctive relief, monetary damages, and civil penalties.
U.S. Attorney Durham noted that the owners of Ibiza and Mangos have cooperated with the U.S. Attorney’s Office to address the ADA issues without the need for litigation.
Any member of the public who wishes to file a complaint alleging that any place of public accommodation or public entity in Connecticut is not accessible to persons with disabilities may contact the U.S. Attorney’s Office at 203-821-3700.
Additional information about the ADA can be found at www.ada.gov, or by calling the Justice Department’s toll-free information line at (800) 514-0301 and (800) 514-0383 (TTY). More information about the Civil Rights Division and the laws it enforces is available at www.justice.gov/crt.
This matter was handled by Assistant U.S. Attorney Jessica H. Soufer of the District of Connecticut in coordination with the Disability Rights Section of the U.S. Department of Justice Civil Rights Division.
Great Falls Man Sentenced for Possession of Child PornographyRead the Press Release
MISSOULA – Shane Courtney, 50, of Great Falls, Montana, was sentenced today to 66 months in prison for possession of child pornography. Courtney pleaded guilty January 24, 2018 to one count of possession of child pornography. Courtney admitted that from June 2005 through February 28, 2017, he possessed child pornography. Federal agents discovered his child pornography collection after they searched his residence in February 2017. At that time, Courtney was residing in Anaconda with his wife and children. Agents seized computers and storage devices that were later examined by the Intermountain West Regional Computer Forensics Laboratory in Billings. A Certified Forensic Examiner determined that Courtney possessed numerous files depicting child pornography including images of prepubescent children.
In addition to the prison term, U.S. District Court Judge Dana L. Christensen ordered Courtney to pay a $100 special assessment and ordered 15 years of supervised release.
This case was initiated under the Department of Justice’s Project Safe Childhood initiative, which was launched in 2006 to combat the proliferation of technology-facilitated crimes involving the sexual exploitation of children. Through a network of federal, state and local law enforcement agencies and advocacy organizations, Project Safe Childhood attempts to protect children by investigating and prosecuting offenders involved in child sexual exploitation. It is implemented through partnerships including the Montana Internet Crimes Against Children (ICAC) Task Force. The ICAC Task Force Program was created to assist state and local law enforcement agencies by enhancing their investigative response to technology facilitated crimes against children.The case was investigated by Federal Bureau of Investigation and U.S. Immigration and Customs Enforcement Homeland Security Investigations. Both federal agencies are members of the Montana Internet Crimes Against Children Task Force. The case was prosecuted by Assistant United States Attorney Cyndee L. Peterson.
Fort Wayne Man Sentenced to 71 Months in PrisonRead the Press Release
FORT WAYNE – Byron Curry, 42 years old, of Fort Wayne, Indiana, was sentenced by U.S. District Court Judge Theresa L. Springmann after pleading guilty to bank robbery, announced United States Attorney Thomas L. Kirsch II.
Curry was sentenced to 71 months imprisonment, 1 year supervised release and ordered to pay restitution in the sum of $1,334.00.
According to documents in the case, on December 3, 2016, Byron Curry and his two female co- defendants robbed a First Source Bank located in Fort Wayne, Indiana.
This case was investigated by the Federal Bureau of Investigation, the Allen County Sheriff’s Department, and the Fort Wayne Police Department and prosecuted by Assistant United States Attorney Lesley J. Miller Lowery.
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Fort Peck Tribal Officer Sentenced to Prison for Stealing Drug EvidenceRead the Press Release
GREAT FALLS - The United States Attorney’s Office announced that former Fort Peck Tribal Officer Mikkel Derrik Shields was sentenced to one year in prison, one year of supervised release, and ordered to pay $1,149.06 in restitution. The sentencing occurred on June 28, 2018, before U.S. District Judge Brian Morris, in Great Falls, Montana.
In an offer of proof filed by Assistant U.S. Attorney Ryan G. Weldon, the government explained that Officer Shields, while on duty, broke into the evidence room at the Fort Peck Tribal Law and Justice Building. While there, Officer Shields stole drug evidence, including methamphetamine, prescription drugs, marijuana, and money. When interviewed, Officer Shields admitted he indeed took the drugs because he “just needed them” and he was a “weak person.” As a result of Shields’ actions, the Fort Peck Tribe was forced to dismiss 27 criminal cases, including other drug cases, assaults, and property crimes.
This case was investigated by the Federal Bureau of Investigation. Because there is no parole in the federal system, the truth in sentencing guidelines mandate that Shields will likely serve all of the time imposed by the court. In the federal system, Shie.ds does have the opportunity to shorten the term of custody by earning credit for good behavior. However, this reduction will not exceed 15% of the overall sentence.
Former health care chief executive sentenced to 9.5 years in federal prisonRead the Press Release
James Burkhart’s conspiracy reaped nearly $19.4 million in fraud and kickbacks, funding
private jets, vacation homes, diamond jewelry, and gold bars
PRESS RELEASE
INDIANAPOLIS B United States Attorney Josh J. Minkler today announced the sentencing of the former CEO of American Senior Communities (ASC) in a massive fraud, kickback, and money laundering conspiracy. James Burkhart, 53, of Carmel, was sentenced to 114 months imprisonment by U.S. District Court Judge Tanya Walton Pratt.
“In spite of receiving a salary of over $1 million, Burkhart abused his official position of trust to steal tax payer dollars intended to benefit this community’s sick, elderly and mentally challenged,” said Minkler. “Because this thief was motivated by nothing other than corruption and greed, we sought a justifiably harsh sentence. Hopefully, the sound of the prison door slamming shut on this 9.5 year sentence will deter other officials from the culture of corruption and greed we see in this district.”
Today’s sentencing caps a three-year federal investigation and prosecution of Burkhart, who was charged with ASC Chief Operating Officer Daniel Benson, Burkhart friend and associate Steven Ganote, and Burkhart’s younger brother, Joshua Burkhart. In September 2015, federal agents executed search warrants at Burkhart’s residence and ASC office, among other locations. By October 2016, a federal grand jury indicted Burkhart and his co-defendants. And by January 2018, all of the defendants had pleaded guilty to federal felony charges.
For his part, Burkhart pleaded guilty to three federal felony offenses: conspiracy to commit fraud, conspiracy to violate the health care anti-kickback statute, and money laundering. All told, he and his co-conspirators funneled nearly $19.4 million in fraud and kickbacks to themselves through a web of shell companies. The majority of the money they stole came from the Health & Hospital Corporation of Marion County, part of Indiana’s public health system and the operator of health care facilities like Eskenazi Hospital.
Burkhart’s fraud and kickback schemes, which spanned nearly six years, exploited numerous aspects of ASC’s operations. ASC is Indiana’s largest nursing home chain. It manages approximately 70 senior care facilities throughout the state, and to run those nursing homes, ASC purchases a wide variety of goods and services provided by outside vendors. The bulk of the money to pay those vendors’ bills comes from Health & Hospital.
Burkhart used his position as ASC’s CEO to cut secret side deals with over a dozen of ASC’s vendors. He dangled the golden carrot of the purchasing power of the State’s largest nursing home chain. All they had to do was pay something back.
In some cases, Burkhart had vendors inflate their bills to ASC, which Burkhart would pay with Health & Hospital’s money, and the vendor would kick the overage back to Burkhart and his co-conspirators. In other cases, he formed shell companies that would inflate vendors’ bills and submit them to ASC as if the shell companies were the real vendor. In still other cases, he caused vendors or shell companies to submit completely false bills for fictitious services that were never provided. And finally, in some cases, he simply demanded vendors to pay him kickbacks in exchange for him allowing them to service ASC’s large number of facilities.
This last category included home health and hospice care, where Burkhart received a kickback for each patient ASC referred to Burkhart’s chosen home health or hospice company.
Landscaping, electrical generators, employee uniforms, patient gifts, American flags, furniture, heating and air conditioning, wound care creams, medical supplies, air fresheners, speech therapy, pharmacy services, food services, home health care, and hospice care – Burkhart concocted secret side deals involving all of those aspects of ASC’s operations.
His motive was pure greed. He was caught on tape telling an informant, in reference to one of his schemes that netted him over $600,000 per year, “I ain’t givin’ that up. . . . It doesn’t sound like much money, but it’s money.” Over the six years, Burkhart use the money he stole to buy lakefront real estate on Lake Wawasee, golf vacations, trips to Las Vegas, political contributions, diamond jewelry, gold coins and gold bars. In addition, Burkhart spent over $1.5 million of other peoples’ money on over 150 flights on private jets.
As Burkhart told the informant, “I’ll get mine, I always told ya, I’ll get mine one way or another.” That was true until 2015, when a vendor Burkhart tried to ensnare went to the FBI. Burkhart and his co-conspirators had asked the vendor to inflate his bills by 30% and pay the overage to a shell company. The vendor thought that did not sound right or ethical, so he reported it to law enforcement. What followed was an extensive investigation involving multiple undercover informants, search warrants, and a detailed analysis of numerous shell companies and nearly 100 bank accounts – all of which culminated in the indictments, guilty pleas, and ultimately, today’s sentencing of Burkhart to 114 months in federal prison.
This case was jointly investigated by the Federal Bureau of Investigation (FBI), the Internal Revenue Service-Criminal Investigation Division (IRS-CID), and the Department of Health and Human Services, Office of Inspector General (HHS-OIG).
"This defendant was paid a large salary and viewed as an industry leader, but he chose to abuse his power and position out of pure greed,” said Grant Mendenhall, Special Agent in Charge of the FBI’s Indianapolis Division. “The FBI works diligently with partner agencies to uncover and investigate corporate executives who enrich themselves through kickbacks and theft. We applaud the concerned citizen who brought this fraud to our attention, and we encourage anyone else who wants to bring these types of fraudulent behavior to light to contact us.”
David Talcott, Acting Special Agent in Charge of IRS Criminal Investigation's Chicago Field Office said, "Burkhart’s theft from the most vulnerable citizens of our communities is sickening. Taxpayers deserve honesty and integrity from business leaders. IRS-CI's thoroughness of the financial investigation represents our commitment to protect the taxpayers of this community."
“Health Care Fraud is fueled by greed and is perpetrated by criminals with the intent of concealing their acts and securing financial riches at the expense of taxpayers”, said Lamont Pugh III, Special Agent in Charge, U.S. Department of Health & Human Services, Office of Inspector General. “Mr. Burkhart spun a web of deceit through side deals, inflated invoices and shell companies in order to pilfer funds from Medicare and Medicaid which ultimately led him to the doorstep of law enforcement and prosecutorial authorities. The OIG will continue to work with our federal, state and local law enforcement partners to uncover these schemes and hold those who execute them accountable.”
“I am eager to collaborate with other public offices and agencies to stop fraudsters from stealing money from Medicaid,” said Attorney General Curtis Hill. “This is a program intended to help people who truly need it. We will stay vigilant in holding accountable all those who seek to bilk taxpayers by misappropriating funds.”
According to Assistant U.S. Attorneys Nick Linder and Cindy Cho, who prosecuted the case, the gold bars, gold coins, and other assets seized from Burkhart will be criminally forfeited. In addition, Burkhart must pay full restitution and serve three years of supervised release following his sentence.
Burkhart’s co-defendants will be sentenced on the following dates and times:
- Daniel Benson on July 6 at 9:00 a.m.
- Steven Ganote on July 9 at 9:00 a.m.
- Joshua Burkhart on July 9 at 2:00 p.m.
- David Mazanowski on July 10 at 2:00 p.m.
- In October 2017, United States Attorney Josh J. Minkler announced a Strategic Plan designed to shape and strengthen the District’s response to its most significant public safety challenges. This prosecution demonstrates the Office’s firm commitment to prosecuting complex, large-scale fraud schemes, particularly those that exploit positions of trust. See United States Attorney’s Office, Southern District of Indiana Strategic Plan 5.1
Former Washington State Auditor Sentenced to One Year in Prison for Fraud, Tax and False Statement Crimes Committed while Serving in Washington LegislatureRead the Press Release
Former Washington State Auditor TROY X. KELLEY was sentenced today in U.S. District Court in Tacoma to one year in prison for possession of stolen property, making false declarations in a court proceeding, and tax fraud, announced U.S. Attorney Annette L. Hayes. KELLEY was convicted of eight federal felonies in December 2017, following a five-week trial.
The charges stem from a business KELLEY operated while also serving in the Washington state legislature. KELLEY used some of the stolen money to fund his 2012 campaign for State Auditor. At the sentencing hearing, U.S. District Judge Ronald B. Leighton said, “There was overwhelming evidence of guilt… He wanted money, he found a vehicle to acquire wealth and what he did was known by him to be wrong…. Somebody who has done nothing wrong does not forge documents. He is guilty of this crime.”
“This case stands out because of Mr. Kelley’s calculated efforts to steal nearly $3 million dollars from thousands of homeowners when he thought no one was looking,” said U.S. Attorney Annette L. Hayes. “What’s worse, he did this while serving as a state legislator and then used part of his ill-gotten gains to fund his campaign for state auditor. We rightly expect our public servants to comply with the law and truly serve. I commend the prosecutors and investigators who put this case together and thus ensured Mr. Kelley’s lies and deceit were exposed for all to see.”
According to the evidence at trial, between 2003 and 2008, KELLEY operated a business that monitored real estate filings on county websites. KELLEY agreed with escrow companies that his business would charge a flat fee of $15 or $20 for each real estate transaction it monitored for the escrow companies’ customers. In addition to the flat fee, the escrow companies also gave Kelley $100-$150 of customer money for each transaction, which KELLEY agreed to use to pay expenses if necessary. KELLEY agreed to refund the money to the homeowners if there were no expenses. However, beginning in 2005, in virtually every case he handled, KELLEY kept the entire amount withheld on each transaction, thereby stealing nearly $3 million.
In 2008, class action lawsuits were filed against escrow companies, claiming that homeowners had been charged excessive fees in real estate transactions. After the lawsuits were filed, KELLEY falsified a letter to the plaintiff in one lawsuit to make it appear that KELLEY had refunded the plaintiff’s money, when in fact he had not. Concerned that the lawsuits would lead to his downfall, KELLEY transferred millions of dollars of stolen money through a series of bank accounts, ultimately placing the funds in an investment account for a company controlled by a Central American trust controlled by KELLEY. One of the escrow companies sued KELLEY to retrieve the stolen money. KELLEY testified falsely under oath in the lawsuit that he had only kept money he had earned for services provided. One of KELLEY’s convictions for making false declarations in a court proceeding is based on that testimony.
Beginning in 2011, KELLEY spent the stolen money on personal expenses and his campaign for State Auditor. To hide the fact that this was money he had stolen years earlier, KELLEY claimed on his tax returns that he was continuing to perform real estate services, and to earn income through his business, when in fact he had not operated the business for years. In the same tax returns, KELLEY claimed tens of thousands of dollars of business deductions for personal items like spa treatments, a family trip, and household purchases such as sheets and toys. KELLEY’s tax fraud convictions are based on this conduct.
In December 2017, a unanimous jury convicted KELLEY of possession of stolen property, two counts of making false declarations under oath, and six counts of tax fraud. Following the trial, an unrelated U.S. Supreme Court ruling resulted in the dismissal of one of the tax fraud counts.
“During the years he ran his business Mr. Kelley stole $2.9 million from thousands of his customers. He attempted to further conceal his misdeeds by failing to report the monies to the IRS,” said Darrell Waldon, Special Agent in Charge, IRS Criminal Investigation. “Today’s sentence demonstrates the government’s determination to protect consumers and ensure that everyone, including elected officials, are playing by the rules and paying the taxes they owe on income received from legal and illegal sources.”
“The vast majority of public officials are honest in their work. Unfortunately, a small percentage abuse the trust placed in them," said Special Agent in Charge Jay S. Tabb, of the FBI's Seattle Field Division. “Identifying and investigating those corrupt public officials is the FBI’s top criminal investigative priority. Citizens have the right to nothing less than fair and honest government. Mr. Kelley violated the public's confidence through criminal actions he undertook while in office to conceal his previous illegal activity. The citizens of Washington rightfully demand high ethical standards from public servants.”
The case was investigated by the Internal Revenue Service Criminal Investigation (IRS-CI) and the FBI.
The case was prosecuted by Assistant United States Attorneys Arlen Storm, Andrew Friedman, Seth Wilkinson, Katheryn Frierson, and Michelle Jensen. Appellate attorney Michael Morgan provided significant assistance.
Former Virginia Software Company CEO Sentenced to Prison for Employment Tax FraudRead the Press Release
A former Chief Executive Officer (CEO) of a software company in Sterling, Virginia, was sentenced to 21 months in prison today for conspiring to defraud the government by failing to pay over employment taxes to the Internal Revenue Service (IRS), announced Principal Deputy Assistant General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney G. Zachary Terwilliger for the Eastern District of Virginia.
According to court documents, Robert Lewis was the CEO of Enterworks, Inc., a software company in Sterling, Virginia. From January 2011 to February 2013, Lewis conspired with Kristie McDonald, Enterworks’ Vice President of Finance and Administration, to defraud the United States by failing to pay over to the IRS more than $1.8 million in payroll taxes withheld from employee paychecks.
As part of their scheme, Lewis and McDonald circumvented the company’s normal payroll and accounting procedures by paying some employees with manual paychecks. The employees still received the correct pay after withholdings, but by bypassing the accounting system, Lewis and McDonald were able to hide the fact that the withholdings were not being paid over to the IRS. The practical effect of their scheme was to conceal the company’s failing financial condition from its Board of Directors. They also caused the company to file false quarterly employment tax returns with the IRS that underreported the amount of tax due.
During this same period, Lewis and McDonald failed to remit the full amount of employee retirement contributions to the company’s retirement plan. Through their actions, the company failed to transfer nearly $225,000 in voluntary employee retirement withholdings. Lewis and McDonald used the misappropriated money to pay the operating expenses of the company, which included their own six figure salaries and salary raises for other employees.
In addition to the term of imprisonment, U.S. District Judge T.S. Ellis III ordered Lewis to serve three years of supervised release and to pay restitution in the amount of $1,812,706 million.
McDonald was previously sentenced on June 22 to 15 months imprisonment to be followed by three years of supervised release and also ordered to pay restitution in the amount of $1,812,706 million.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Terwilliger thanked agents of IRS Criminal Investigation and the Department of Labor who conducted the investigation, and Tax Division Trial Attorneys Kevin Schneider and Charles M. Edgar, Jr. and Assistant U.S. Attorney Ryan Faulconer, who are prosecuting the case.
Former Quincy Man Pleads Guilty to $1.7 Million Real Estate Fraud SchemeRead the Press Release
BOSTON – A former Quincy man, who had been a fugitive for more than 20 years prior to his arrest in April 2017, pleaded guilty today in federal court in Boston in connection with a $1.7 million real estate investment fraud scheme in Quincy.
Scott J. Wolas, 69, pleaded guilty to seven counts of wire fraud, one count of aggravated identity theft, misuse of a Social Security number, and tax evasion. U.S. District Court Judge F. Dennis Saylor IV scheduled sentencing for Oct. 2, 2018. Wolas remained a fugitive for more than 20 years until his arrest in Delray Beach, Fla., in April 2017.
From at least 2009 through 2016, Wolas, using the name Eugene Grathwohl, operated a real estate business known as Increasing Fortune Inc. and worked as a licensed real estate agent for Century 21 in Quincy. From 2014 through 2016, he solicited investments for the development of the Beachcomber Bar property on Quincy Shore Drive and for the construction of a single-family home on the adjacent property. He collected more than $1.7 million from at least 20 investors and promised each of them a significant return on their investments. He further promised to pay out at least 125% of the profits related to the single-family home construction. However, Wolas used the money mostly for personal expenses unrelated to development of the real estate projects.
Wolas was scheduled to close on the Beachcomber property on Sept. 15, 2016. A week before, however, he left Quincy and ceased all contact with his then-girlfriend, his co-workers, and his investors. Law enforcement then discovered that Grathwohl was actually Wolas, a former lawyer who had been a fugitive since 1997 after being charged with fraud and grand larceny in New York. The real Eugene Grathwohl resided in Florida and was known to Wolas.
On Nov. 17, 2016, law enforcement officers interviewed Wolas’ ex-wife, Cecily Sturge, of Delray Beach, Fla., who stated that she had not been in contact with her ex-husband for approximately 15 years. Sturge continued to say that this was so, despite evidence of contact between her cell phone and one known to belong to Wolas that demonstrated more recent communication between the two.
After further investigation, Wolas was arrested on April 7, 2017, at a condominium he was renting in Delray Beach, Fla. Investigators learned that Wolas had first rented the room in the condo from Nov. 12 through Nov. 21, 2016, through an online rental website in the name of Cecily Sturge. Messages exchanged between the condo owner and Sturge depicted a photo of Sturge and messages claiming that Wolas (using the name Cameron Sturge) was Sturge’s brother and a retired paleontologist in need of a place to stay. The owner of the condo told authorities that Sturge and Wolas arrived at the condo together in the same car on Nov. 12, 2016, five days before Sturge’s interview with law enforcement.
Sturge was divorced from Wolas in 2001 by default judgment in Palm Beach County, Fla. In February 2017, Sturge filed a petition to modify the judgment in order to obtain the contents of Wolas’ retirement account, which had a balance of approximately $647,000, from the New York law firm where he worked prior to being indicted in 1997 by New York authorities. In pleadings filed in February and March 2017 regarding that matter, Sturge swore that Wolas’ whereabouts were unknown to her, despite telephone records showing frequent contact between the two. In addition, copies or drafts of documents filed in the Florida proceeding, along with a thumb drive, were found in the room where Wolas was arrested. The United States previously obtained a court order freezing the retirement account pending the resolution of the criminal proceedings.
Sturge previously pleaded guilty to making a materially false statement to a federal agent and was sentenced in May 2018 to one year of probation.
The charge of wire fraud provides for a sentence of no greater than 20 years in prison, three years of supervised release and a fine of up to $250,000 or twice the gross gain or loss. The charge of aggravated identity theft provides for a minimum of two years in prison, which must be served consecutively to any other sentence imposed, one year of supervised release and a fine of up to $250,000. The charge of misuse of a Social Security number provides for a sentence of no greater than five years in prison, three years of supervised release, and a fine of $250,000 or twice the gross gain/loss whichever is greater. Sentences are imposed by a federal district court judge based upon the US sentencing guidelines and other statutory factors.
United States Attorney Andrew E. Lelling; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Kristina O’Connell, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston; Scott Antolik, Special Agent in Charge of the Social Security Administration, Office of Inspector General, Office of Investigations, Boston Field Division; and Quincy Police Chief Paul Keenan made the announcement today. Assistant U.S. Attorneys Sandra S. Bower of Lelling’s Criminal Division and David G. Lazarus of Lelling’s Civil Division are prosecuting the case.
Former Elk Grove Resident Indicted for Bankruptcy-Related OffensesRead the Press Release
SACRAMENTO, Calif. — A federal grand jury returned an 18-count indictment today against Arlina Alexander-Zaplutus, 50, formerly of Elk Grove, charging her with making false statements in bankruptcy cases, and falsification of documents in bankruptcy, U.S. Attorney McGregor W. Scott announced.
According to court documents, Alexander-Zaplutus filed and caused the filing of bankruptcy petitions in the U.S. Bankruptcy Court for the Eastern District of California that contained materially false information, including purported debtors’ names, addresses, and Social Security numbers. Alexander-Zaplutus is alleged to have filed and caused the filing of the falsified petitions to invoke the automatic stay provisions of federal bankruptcy law with respect to her and her clients’ residential properties, which halted creditors’ collection and foreclosure actions. The indictment also alleges that Alexander-Zaplutus falsified bankruptcy petitions with the intent to obstruct the investigation and proper administration of bankruptcy cases.
This case is the product of an investigation by the Federal Bureau of Investigation. Assistant U.S. Attorneys Philip A. Ferrari and Matthew C. Thuesen are prosecuting the case.
Alexander-Zaplutus’ whereabouts are unknown. A warrant was issued for her arrest.
If convicted, Alexander-Zaplutus faces a maximum statutory penalty of five years in prison and a $250,000 fine for each false statement count and 20 years in prison and a $250,000 fine for each count of falsifying documents in bankruptcy. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
Five Members of Mexican Drug Trafficking Organization Plead Guilty to Drug Trafficking and Money Laundering ChargesRead the Press Release
ALBUQUERQUE – Five of the 22 defendants charged with federal drug trafficking and international money laundering charges in a superseding indictment filed in Aug. 2017, entered guilty pleas in federal court in Las Cruces, N.M., recently under plea agreements recommending sentences ranging from 36 months to 20 years of imprisonment.
Twenty-three defendants were charged on April 19, 2017, in a 44-count indictment, as the result of a 16-month DEA-led federal investigation targeting a Mexican drug trafficking organization (DTO) responsible for importing large quantities of heroin, methamphetamine and cocaine from Mexico, and distributing the drugs in New Mexico, Texas, Kansas, Kentucky and Illinois. During the investigation, law enforcement authorities seized approximately 30 kilograms of heroin, 64 kilograms of methamphetamine, 17 kilograms of cocaine, 20 kilograms of marijuana, 24 firearms, $102,000 in currency, and three vehicles. The investigation concluded in April 2017, with a multi-agency law enforcement operation that included the execution of arrest warrants in New Mexico and Texas, and six search warrants in El Paso, Tex., Sunland Park, N.M., Belen, N.M., and Albuquerque, N.M.
A superseding indictment was subsequently filed on Aug. 16, 2017, that included all of the charges from the indictment but removed one defendant. The superseding indictment charged the 22 defendants with participating in a conspiracy to distribute heroin, methamphetamine and cocaine between April 2016 and April 2017. It also charged nine of the defendants with participating in an international money laundering conspiracy during that same period in time. The superseding indictment also charges certain defendants with engaging in a series of substantive drug trafficking and money laundering offenses, and using communication devices (telephones) to facilitate their criminal activities. It charges one defendant with a firearms offense.
The superseding indictment included 77 overt acts allegedly committed by the defendants in furtherance of the drug trafficking conspiracy which describe the expansive sweep of the DTO’s drug distribution operation and the significant quantities of drugs involved. For example, the overt acts alleged that the DTO’s drug trafficking and money laundering activities extended to Kentucky, where law enforcement officers seized $15,300 in drug proceeds from a courier who was transporting the money to New Mexico in April 2016; Oklahoma, where law enforcement officers seized 4.44 kilograms of methamphetamine from a courier in June 2016; and New Mexico, where law enforcement officers seized six kilograms of heroin and 3.56 kilograms of methamphetamine from a courier at a U.S. Border Patrol checkpoint in Oct. 2016.
The superseding indictment also included forfeiture allegations, which sought forfeiture to the United States of the proceeds of the DTO’s drug trafficking and money-laundering activities, including $56,556 seized by the DEA during the investigation.
The following five defendants have entered guilty pleas in the past two weeks:
- Jose Manuel Ortiz-Campos, 28, a legal permanent resident residing in El Paso, Texas, pleaded guilty on June 19, 2018, to conspiracy to distribute methamphetamine and heroin, conspiracy to commit international money laundering, possession of methamphetamine and heroin with intent to distribute, and international money laundering. Ortiz-Campos admitted that in April 2017, he obtained drugs brought into the United States in the southern New Mexico and El Paso, Texas areas, and transported and delivered the drugs to Albuquerque and other locations. Ortiz-Campos admitted collecting drug proceeds for delivery to Mexico. Under the terms of his plea agreement, Ortiz-Campos will be sentenced within the range of 180 to 240 months in federal prison and will then be deported.
- Manuel German Ibarra, 34, of Albuquerque, N.M., pled guilty on June 26, 2018 to conspiracy to distribute methamphetamine, conspiracy to commit international money laundering, using a communication facility in furtherance of a drug trafficking crime, and international money laundering. Ibarra admitted that in April 2017, he worked with others to distribute drugs in New Mexico and other locations by receiving and storing drugs in Albuquerque. Ibarra also delivered drug proceeds to couriers who transported the money to Mexico. Ibarra was responsible for trafficking approximately 3.6 kilograms of methamphetamine and three kilograms of cocaine. At sentencing, Ibarra faces a statutory mandatory minimum penalty of ten years and a maximum of life in federal prison.
- Daisy Hidalgo, 23, of Anthony, N.M., and Jasmine Lucia Soto, 20, of Chaparral, N.M., pled guilty on June 27, 2018, to conspiring to distribute methamphetamine and heroin, and possessing methamphetamine and heroin with intent to distribute. Each admitted that in Nov. 2016, they drove or rode in vehicles loaded with drugs through checkpoints, and on Nov. 22, 2016, they were stopped for traffic violations in Belen, N.M., and law enforcement seized approximately 6.82 kilograms of pure methamphetamine and 3.0 kilograms of heroin from their vehicles. At sentencing, Hidalgo faces a statutory mandatory minimum penalty of ten years and a maximum of life in federal prison. Soto entered her guilty plea under a plea agreement recommending a sentence of 36 months of imprisonment.
- Today, Diego Armando Rivas-Aguilar, 24, of El Paso, Texas, pled guilty to conspiracy to distribute methamphetamine and heroin, and to using a communication device in furtherance of a drug trafficking crime. Rivas-Aguilar admitted that between April 2016 and Feb. 2017, he maintained a stash house in El Paso, Texas, where he distributed drugs imported into the United States, and the drugs were then transported to Albuquerque and other locations. Rivas-Aguilar admitted that during this period, law enforcement agents seized approximately 15.2 kilograms of methamphetamine and 11.38 kilograms of heroin that had been delivered to the stash house and that Rivas-Aguilar subsequently delivered to transportation crews within the DTO. Rivas-Aguilar pled guilty under a plea agreement recommending a sentence of 63 months of imprisonment followed by a term of supervised release to be determined by the court.
To date, eight of the 22 defendants have entered guilty pleas and are awaiting sentencing. Twelve defendants have entered pleas of not guilty and are pending trial. Three defendants have yet to be arrested and are considered fugitives. Charges in indictments and criminal complaints are only accusations. All criminal defendants are presumed innocent unless proven guilty beyond a reasonable doubt.
The Las Cruces and Albuquerque offices of the DEA conducted the investigation with assistance from the U.S. Border Patrol, New Mexico State Police and Hatch Police Department. Assistant U.S. Attorneys Selesia L. Winston and Sarah M. Davenport of the U.S. Attorney’s Las Cruces Branch Office are prosecuting the cases as part of the OCDETF Program and the New Mexico Heroin and Opioid Prevention and Education (HOPE) Initiative.
The OCDETF Program is a nationwide Department of Justice program that combines the resources and unique expertise of federal agencies, along with their local counterparts, in a coordinated effort to disrupt and dismantle major drug trafficking organizations.
The HOPE Initiative was launched in January 2015 by the UNM Health Sciences Center and the U.S. Attorney’s Office in response to the national opioid epidemic, which has had a disproportionately devastating impact on New Mexico. Opioid addiction has taken a toll on public safety, public health and the economic viability of our communities. Working in partnership with the DEA, the Bernalillo County Opioid Accountability Initiative, Healing Addiction in our Community (HAC), the Albuquerque Public Schools and other community stakeholders, HOPE’s principal goals are to protect our communities from the dangers associated with heroin and opioid painkillers and reducing the number of opioid-related deaths in New Mexico. The HOPE Initiative is comprised of five components: (1) prevention and education; (2) treatment; (3) law enforcement; (4) reentry; and (5) strategic planning. HOPE’s law enforcement component is led by the Organized Crime Section of the U.S. Attorney’s Office and the DEA in conjunction with their federal, state, local and tribal law enforcement partners. Targeting members of major heroin and opioid trafficking organizations for investigation and prosecution is a priority of the HOPE Initiative.
Five Defendants Charged with Illegal Opioid Distribution as Part of a National Healthcare Fraud TakedownRead the Press Release
United States Attorney Matthew D. Krueger announced today that a federal grand jury in the Eastern District of Wisconsin indicted Lisa Hofschulz, 58, who is an Advanced Practice Nurse Practitioner, and her ex-husband Robert Hofschulz, 70, for conspiring to distribute oxycodone and methadone outside of a professional medical practice and not for a legitimate medical purpose through their cash-only pain clinic, Clinical Pain Consultants, s.c. (“CPC”) in violation of 21 U.S.C. §§ 841(a)(1), 841(b)(1)(C) and 846. In a separate case, the grand jury also charged Kameka Simpson, 43, Eric Jasper, 33, and Brittany Washington, 27, with multiple counts of obtaining controlled substances (oxycodone) by fraud, in violation of Title 21, United States Code, Section 843(a)(3), and aggravated identity theft, in violation of Title 18, United States Code, Section 1028A(a)(1). Both of these indictments were part of a larger National Healthcare Fraud and Opioid Takedown coordinated by the Department of Justice and the Department of Health and Human Services.
The indictment against Lisa and Robert Hofschulz charges fourteen counts, alleging that CPC collected over $800,000 in cash from patients in 2015 and over $1,000,000 in cash in 2016 because its prescribers, primarily Lisa Hofschulz, prescribed excessive dosages of controlled substances outside of a professional medical practice and not for a legitimate medical purpose. CPC is located in Wauwatosa, Wisconsin.
As part of the alleged conspiracy, Lisa and Robert Hofschulz hired newly graduated nurse practitioners with minimal pain management experience, provided them inadequate training, provided no written policies, and pressured them to prescribe dosages similar to Lisa Hofschulz to patients. Lisa and Robert Hofschulz also failed to provide the new nurse practitioners a (legally required) collaborative physician for much of the time period covered by the conspiracy. The indictment also alleges Lisa and Robert Hofschulz directed an individual not authorized to issue prescriptions (Registered Nurse) to distribute controlled substance prescriptions to customers when authorized prescribers refused. Additionally, Lisa Hofschulz mailed controlled substance prescriptions or allowed them to be picked up from the front desk of CPC without being seen by Lisa Hofschulz or any other prescribers. The indictment alleges that Lisa and Robert Hofschulz “caused an enormous amount of opioids to be distribute throughout Wisconsin, fueling opioid addictions in numerous individuals, while collecting huge sums of cash for themselves.” Finally, the indictment charges that 13 specific prescriptions were issued outside a professional medical practice and not for a legitimate medical purpose.
The indictment against Kameka Simpson, Eric Jasper, and Brittany Washington, each of Milwaukee, Wisconsin, charges eight counts stemming from this group’s passing of fraudulent oxycodone prescriptions purportedly written by an authorized healthcare provider. Some of the defendants were employed by the healthcare provider, who practiced at a pain clinic in West Allis, Wisconsin.
Each count of distribution of controlled substances against Lisa and Robert Hofschulz carries a maximum penalty of 20 years in prison and a $1,000,000 fine. If Kameka Simpson, Eric Jasper, and Brittany Washington are convicted of aggravated identity theft, these defendants each face a mandatory minimum prison sentence of two years, a fine of up to $250,000, as much as one year of supervised release, and a special assessment of $100. Each prescription fraud count carries a maximum penalty of four years’ imprisonment, a fine of up to $250,000, as much as one year of supervised release, and a special assessment of $100.
Both of these indictments were part of a larger National Healthcare Fraud and Opioid Takedown coordinated by the Department of Justice and the Department of Health and Human Services. This year’s takedown was the largest ever health care fraud enforcement action involving 601 charged defendants across 58 federal districts, including 165 doctors, nurses and other licensed medical professionals, for their alleged participation in health care fraud schemes involving more than $2 billion in false billings. Of those charged, 162 defendants, including 76 doctors, were charged for their roles in prescribing and distributing opioids and other dangerous narcotics. Thirty state Medicaid Fraud Control Units also participated in today’s arrests. In addition, HHS announced today that from July 2017 to the present, it has excluded 2,700 individuals from participation in Medicare, Medicaid, and all other Federal health care programs, which includes 587 providers excluded for conduct related to opioid diversion and abuse.
United States Attorney Krueger stated, “Addiction to opioids has created has a crisis in Wisconsin, with the number of overdose deaths continuing to increase. We must act with urgency to reduce overdose deaths, using all available tools, including prevention and treatment programs as well as law enforcement efforts. For many, the road to addiction begins with prescription drugs. That’s why we are committed to prosecuting individuals who distribute prescription drugs outside of a professional medical practice. We commend the excellent joint investigative efforts that led to these indictments.”
“Prescription painkiller abuse is a root cause of the state’s drug epidemic and can lead to heroin use,” said Wisconsin Attorney General Brad Schimel. “Enforcement, along with prevention and treatment, is crucial to stopping opioid abuse in our state. The indictments announced today demonstrate the value of collaboration between a multi-jurisdictional group of local, state, and federal investigators and prosecutors, and that all partners are united in their desire to end the drug epidemic.”
Paul E. Maxwell, Jr., Assistant Special Agent in Charge of the DEA’s Milwaukee Office stated, “The DEA fully supports the good and necessary work of medical providers in the State of Wisconsin and throughout the nation. However, the DEA takes seriously the unethical and criminal diversion or misuse of controlled prescription pain killers, which has driven the national opioid addiction problem this nation currently faces. The DEA continues to work with the medical community to insure the safe prescription of medication to patients.”
“Health care fraud is a threat to this country, both in terms of the well-being of patients and the integrity of government health care programs,” said Lamont Pugh, Special Agent in Charge for the U.S. Department of Health & Human Services Office of Inspector General. “Our agents will continue to work with our law enforcement partners to ensure these criminals are held accountable for their actions.”
The charges contained in the indictments announced today are merely allegations. The defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The Lisa and Robert Hofschulz case was investigated by the Drug Enforcement Administration (“DEA”), the Medicaid Fraud Control and Elder Abuse Unit of the Wisconsin Department of Justice, and Internal Revenue Service—Criminal Investigation. It is being prosecuted by United States Attorney Matthew D. Krueger and Assistant United States Attorneys Zachary Corey and Michael Carter.
The Kameka Simpson, Eric Jasper, and Brittany Washington case was investigated by the DEA, the Department of Health and Human Services, Office of the Inspector General, and the Medicaid Fraud Control and Elder Abuse Unit of the Wisconsin Department of Justice. It is being prosecuted by Assistant United States Attorney Jonathan Koenig.
Information and resources concerning the opioid crisis and the DEA’s “360 Strategy” for addressing the crisis may be found at the DEA’s website, www.dea.gov
Information about “Dose of Reality,” the State of Wisconsin’s effort to prevent prescription painkiller abuse in Wisconsin is available here: https://doseofrealitywi.gov/
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For Additional Information Contact:
Public Information Officer Dean Puschnig 414-297-1700
Fitzgerald Man Pleads Guilty to Possession with Intent to Distribute CocaineRead the Press Release
ALBANY: Charles E. Peeler, United States Attorney for the Middle District of Georgia, announces that Lakevis Woodard, age 31, of Fitzgerald, Georgia pled guilty on June 28, 2018, to Possession with Intent to Distribute Cocaine Base before U.S. District Court Judge Leslie J. Abrams in Albany, Georgia. The plea subjects Mr. Woodard to a term of imprisonment of up to twenty (20) years, a fine of up to $1 million, or both.
Mr. Woodard admitted the following facts in his guilty plea:
On October 19, 2017, local law enforcement was conducting an authorized roadblock in Ben Hill County, Georgia. Mr. Woodard approached the roadblock and drug agents, who had been receiving information that he was selling drugs in the area, were present. They were also aware that he was on active probation as a result of a Georgia First Offender sentence. A trained drug detection dog alerted on the vehicle for the presence of narcotics. Agents conducted a search of Mr. Woodard’s vehicle and located a Ruger Model 1911 .45 caliber semi-automatic pistol under the driver's seat.
During a subsequent search of Mr. Woodard’s residence, officers located a gallon sized ziplock bag of marijuana and a box containing powder cocaine, crack cocaine, and a set of digital scales. Lab test results from the Georgia Bureau of Investigation determined the presence of 22.625 grams of cocaine base, commonly known as crack” cocaine.
“Our office will continue to work with our state and local law enforcement partners to identify, arrest and prosecute drug dealers throughout the Middle District of Georgia. I want to thank the Ben Hill County Sherriff’s Office and the Georgia Department of Community Supervision for their excellent work in this matter” said United States Attorney Charles Peeler.
This case was investigated by the Ben Hill County Sheriff’s Office and the Georgia Department of Community Supervision. Assistant United States Attorney Leah E. McEwen is prosecuting the case for the United States.
Questions concerning this case should be directed to Pamela Lightsey, Public Information Officer, United States Attorney’s Office, at (478) 621-2603.
Federal Jury Finds Licensed Firearms Dealer Guilty of Selling A Firearm and Ammunition to A Convicted FelonRead the Press Release
Tampa, Florida – United States Attorney Maria Chapa Lopez announces that a federal jury has found Jay Loren Goldberg (51, Treasure Island) guilty of two counts of selling a firearm or ammunition to a convicted felon. Goldberg faces a maximum penalty of 10 years in federal prison. His sentencing hearing is scheduled for October 3, 2018. Goldberg was indicted on April 5, 2018.
According to evidence presented at trial, in January 2017, the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) obtained information that convicted felons were obtaining firearms from a firearm dealer at Fast and Easy Pawn in St. Petersburg. During an undercover operation, ATF special agents utilized a confidential informant (CI) who was prohibited from possessing firearms due to felony convictions. Between February 23 and April 26, 2017, the CI, while monitored and supervised by ATF special agents, made several visits to Fast and Easy Pawn and met with Goldberg, the store’s proprietor and a Federal Firearms Licensee (FFL). On February 23, 2017, the CI told Goldberg that he/she was a convicted felon. On March 2, Goldberg sold a firearm to the CI through a straw purchaser. (A “straw purchaser” is a person who is not the actual buyer of the firearm; the straw purchaser buys a firearm for another person.) The straw purchaser, who had no criminal record and could pass the required background check, accompanied the CI to the store. The CI spoke with Goldberg and selected the pistol the CI wanted to buy, and the straw purchaser provided Goldberg with identification and filled out the form for the background check. The CI and Goldberg discussed a holster for the firearm, and the CI told Goldberg to include the holster in the firearm sale. When the CI attempted to hand cash to Goldberg to pay for the firearm and holster, Goldberg said that the money had to come from the straw purchaser. The CI then handed the money to the straw purchaser, who immediately handed it to Goldberg. After the required three-day waiting period, the CI returned to Fast and Easy Pawn on March 8. On that date, Goldberg sold the CI a box of ammunition and provided the CI with the firearm and holster.
Goldberg sold the CI a shotgun on March 9, and another shotgun on March 28. On April 26, Goldberg sold the CI another box of ammunition.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the St. Petersburg Police Department. It is being prosecuted by Assistant United States Attorneys Michael Sinacore and Thomas Palermo.
This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. In October 2017, Attorney General Jeff Sessions announced the reinvigoration of PSN and directed all U.S. Attorneys’ Offices to develop districtwide crime reduction strategies, incorporating the lessons learned since the program’s inception in 2001. In the Middle District of Florida, U.S. Attorney Maria Chapa Lopez coordinates PSN efforts in cooperation with various federal, state, and local law enforcement officials.
Federal Grand Jury Indicts Dallas Man for Securities FraudRead the Press Release
DALLAS – An indictment returned by a federal grand jury yesterday in Dallas charges Patrick O. Howard, 36, of Dallas, Texas, with offenses related to his role in a scheme to defraud investors and to obtain money by materially false and fraudulent pretenses, announced Erin Nealy Cox, U.S. Attorney for the Northern District of Texas.
Specifically, Howard is charged with five counts of securities fraud and nine counts of mail fraud.
The indictment alleges that from January 2015 through April 2017, Howard owned Howard Capital and OE Capital located in Dallas, Texas, and exercised authority over the companies and Funds.
Howard represented himself to be a Registered Investment Advisor, and offered and sold membership units to investors for $50,000 apiece. Investors were told the Funds would invest proceeds from unit sales into third-party companies and that the Funds stood to profit when the companies paid revenue interests.
Howard mislead investors by telling them that their investment would earn a 12% minimum annual return, that OE Capital had average earnings of 20%, that investors’ investments and minimum returns were protected by insurance, and that the Funds purchased real estate to mitigate investors’ risk.
Howard mailed investors who elected to reinvest phony quarterly earnings account statements showing their accounts had been credited the minimum preferred return, when they had not. At the same time, investors who chose to receive their quarterly earnings as distributions were actually given Ponzi payments, or monies paid by other investors, rather than actual earnings of the Funds.
The indictment further alleges that Howard never used a single dollar of investor funds to purchase real estate, and used investors’ money on things the investors did not approve or even know of, including, a nearly $20,000 payment to buyout a former business partner and approximately a $225,000 payment to Howard’s personal bank account that was neither salary nor a bonus.
An indictment is merely an allegation and defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law. If Howard is convicted, the mail fraud counts carry a maximum statutory penalty of 20 years in federal prison and a $250,000 fine, as to each count.
The indictment also includes a forfeiture allegation that would require the defendants, upon conviction, to forfeit to the U.S. any property traceable to the offense.
The case is being investigated by the Federal Bureau of Investigation and the United States Postal Service. Assistant U.S. Attorney Andrew Wirmani is prosecuting the case.
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Farmington Man Pleads Guilty to Fentanyl Trafficking ChargesRead the Press Release
CONCORD - Kyle Leavy, 32, of Farmington, pleaded guilty in federal court to fentanyl trafficking charges, United States Attorney Scott W. Murray announced today.
According to court documents and statements made in court, in the fall of 2017, Leavy sold fentanyl to an individual who was cooperating with the FBI on three separate occasions at locations in Rochester, New Hampshire. During the third drug deal, Leavy sold more than 40 grams of fentanyl.
Leavy pleaded guilty to three counts of distributing a controlled substance. He is scheduled to be sentenced on October 16, 2018.
“Fentanyl traffickers pose a substantial risk to public safety,” said U.S. Attorney Murray. “Because this deadly substance has caused major damage to our community, we will work tirelessly with our law enforcement partners to identify and prosecute those who are responsible for distributing fentanyl in the Granite State.”
"With today’s plea, Mr. Leavy is accepting responsibility for his role in the opioid crisis. However, there’s much more work to be done. The FBI’s Safe Streets Gang Task Force will not stop until we have leveraged every available resource to identify others like him who are flooding our communities with fentanyl, preying on people’s addictions, and contributing to their deaths,” said Harold H. Shaw, Special Agent in Charge, FBI Boston Division.
This matter was investigated by the FBI New Hampshire Safe Streets Gang Task Force. The Task Force is comprised of the FBI, the New Hampshire State Police, New Hampshire Probation and Parole, and the Police Departments of Hudson, Manchester, and Nashua. The case is being prosecuted by Assistant U.S. Attorney Shane B. Kelbley.
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Elmira Man Sentenced on Drug Trafficking and Gun ChargesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX: (716) 551-3051ROCHESTER, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Devaughn Salazar, a/k/a “Snake,” 41, of Elmira, NY, who was convicted following a jury trial of knowingly possessing with intent to distribute and distributing cocaine, possessing a firearm in furtherance of a drug trafficking offense, and being a felon in possession of a firearm, was sentenced to serve 80 months in prison by U.S. District Judge Charles J. Siragusa.
Assistant U.S. Attorneys Sean Eldridge and Charles Moynihan, who handled the prosecution of the case, stated that on October 21, 2012, members of the Elmira Police Department recovered a Taurus .40 caliber pistol during a robbery investigation. Further investigation revealed that, in June of 2012, the owner of the handgun reported it stolen to the Addison Police Department. Agents from the Bureau of Alcohol Tobacco, Firearms and Explosives followed up and determined that the defendant acquired the handgun from Kevin Krowiak, the person who stole it, by trading cocaine for the gun. After acquiring the gun but prior to its recovery by the Elmira Police Department, defendant sold the gun to a third person.
The defendant, having been previously convicted on May 6, 2009, in Steuben County Court of a felony offense, was legally prohibited from possessing any firearm.
The sentencing is the result of an investigation by the Bureau of Alcohol, Tobacco, Firearms, and Explosives under the direction of Special Agent-in-Charge, Ashan Benedict; as well as members of the Elmira Police Department, under the direction of Chief Joseph Kane.
Eastport Man Pleads Guilty to Possessing Child PornographyRead the Press Release
Bangor, Maine: United States Attorney Halsey B. Frank announced that Ryan Mumme, 46, of Eastport, Maine, pleaded guilty today in U.S. District Court to possession of child pornography.
According to court records, the defendant was interviewed by agents at his home and admitted that he had child pornography on his laptop computer. A subsequent forensic examination of the laptop revealed multiple images and videos of children under the age of twelve engaged in sexually explicit conduct.
The defendant faces up to 20 years in prison and a $250,000 fine. He will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
The case was investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the Maine State Police Computer Crimes Unit, and the Eastport Police Department. This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
Eagle Butte Man Charged with Failure to AppearRead the Press Release
United States Attorney Ron Parsons announced that an Eagle Butte, South Dakota, man has been indicted by a federal grand jury for Failure to Appear and Contempt.
Brady One Feather, age 30, was indicted on June 12, 2018. He appeared before U.S. Magistrate Judge Veronica L. Duffy on June 28, 2018, and pled not guilty to the Indictment.
The maximum penalty upon conviction is up to 5 years in federal prison and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on or about May 17, 2018, One Feather knowingly failed to appear for a scheduled hearing in district court which he was summoned and required to appear.
The charges are merely accusations and One Feather is presumed innocent until and unless proven guilty.
The investigation is being conducted by the U.S. Marshals Service. Assistant U.S. Attorney Jay Miller is prosecuting the case.
One Feather was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
District Man Sentenced to Prison for Sexually Abusing, Threatening 12-Year-Old GirlRead the Press Release
WASHINGTON – Tauheed Wheeler, 36, of Washington, D.C., was sentenced today to 30 months in prison on charges of misdemeanor child sexual abuse and felony threats stemming from an incident in which he tried to entice a young girl into the back seat of his car, and then threatened to beat her if she told anyone what happened, announced U.S. Attorney Jessie K. Liu.
Wheeler pled guilty in March 2018, in the Superior Court of the District of Columbia. He was sentenced by the Honorable Ronna L. Beck. Following his prison term, he must register as a sex offender for a 10-year period; he will be on supervised release during that time.
According to the government’s evidence, on Dec. 10, 2016, the victim was 12 years old. Wheeler was a friend of the girl’s mother at the time, and he offered to drive the victim to a relative’s home. The relative was not home, and Wheeler drove the girl into an alley in Southeast Washington, where he parked near some trees. Wheeler got into the back seat of the car and, while touching his genitalia, asked the girl to get into the back seat with him so that he could engage in sexual contact with her. The girl refused. Wheeler kept encouraging the girl to get into the back seat with him, but she continued resisting. Eventually, Wheeler gave up but told that victim that if she told anyone about what he had tried to do, he would beat her. Afraid, the victim did not initially tell her mother. However, in June of 2017, she finally told her mother what Wheeler had done. Her mother immediately called the police. Wheeler was arrested and indicted in January 2018 and has been in custody ever since.
In announcing the sentence, U.S. Attorney Liu commended members of the Youth and Family Services Division of the Metropolitan Police Department (MPD). She also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialist Brenda C. Williams and Victim/Witness Advocate Tracey Hawkins. Finally, she commended the work of Assistant U.S. Attorney Peter V. Taylor, who investigated and prosecuted the case.
District Man Sentenced to 51-Month Prison Term for Stabbing Girlfriend’s Father in ChestRead the Press Release
WASHINGTON – Justin Wray, 30, of Washington, D.C., was sentenced today to 51 months in prison on a charge of assault with a dangerous weapon for stabbing the father of his then-girlfriend in the chest, U.S. Attorney Jessie K. Liu announced.
Under what is known as the Alford doctrine, Wray pled guilty in March 2018 in the Superior Court of the District of Columbia. Under an Alford plea, the defendant does not admit the allegations but agrees that the government has enough evidence to secure a conviction. Wray was sentenced by the Honorable Danya A. Dayson. Following his prison term, he will be placed on three years of supervised release.
According to the government’s evidence, Wray and his girlfriend argued in the early morning of May 4, 2016 at the girlfriend’s apartment in the unit block of Galveston Street SW. Wray then left the residence, but returned a short while later, at approximately 6:40 a.m., to obtain his possessions. The girlfriend’s father let Wray back into the apartment and led Wray to his girlfriend’s bedroom. Soon thereafter, the girlfriend’s father attempted to lead Wray out of the apartment. Wray became extremely agitated. From behind, he reached over the top of his girlfriend’s father’s back and stabbed the father in the chest with a knife. He fled the scene.
The girlfriend’s father suffered a punctured lung. Wray was arrested on Sept. 10, 2016 and has been in custody ever since. In his plea, Wray said that he had no memory of events but acknowledged that the government had sufficient evidence to find him guilty beyond a reasonable doubt at trial.
In announcing the sentence, U.S. Attorney Liu commended the work of those who investigated the case from the Metropolitan Police Department. She also acknowledged the efforts of those who worked on the case from the U.S. Attorney’s Office, including Paralegal Specialists T.J. McPhail and Victim/Witness Advocate Elsa Maltese.
Finally, she commended the work of Assistant U.S. Attorney Louis Manzo, who investigated, indicted and prosecuted the case.
Delaware Man Charged with Dealing Fentanyl that Resulted in Overdose DeathRead the Press Release
COLUMBUS, Ohio – Darnell A. Reeves, 32, of Delaware, Ohio, was arrested today and charged federally with distributing fentanyl that caused at least one overdose death.
Benjamin C. Glassman, United States Attorney for the Southern District of Ohio, Steve Francis, Special Agent in Charge, U.S. Homeland Security Investigations (HSI), Delaware County Prosecutor Carol O’Brien, Delaware County Sheriff Russell L. Martin and other members of the Delaware County Drug Task Force announced the charges.
According to the complaint, investigators traced fentanyl, heroin and crack cocaine back to Reeves (also known as Bookie), after they responded to the scene of an overdose death in Ostrander, Ohio on February 28. The victim was found on a couch in a shed, slumped forward with a used syringe under him.
Reeves also allegedly provided the heroin to a second victim that caused two nonfatal overdoses in February 2018. On one occasion, medics reportedly gave the second victim four doses of Narcan.
Possession with the intent to distribute heroin and fentanyl that resulted in serious bodily injury and/or death carries a potential sentence of 20 years to life in prison.
“This case is an example of how all levels of law enforcement are working together to trace overdose deaths back to their alleged suppliers and prosecute in the most appropriate venue,” U.S. Attorney Glassman said. “We will continue to collaborate in order to combat the impact of fentanyl and heroin on our communities.”
“The charges against Mr. Reeves tragically illustrate how frequently these deadly drugs are claiming the lives of our community members, especially here in Ohio with over 4000 deaths each year since 2016,” said Steve Francis, HSI special agent in charge for Michigan and Ohio. “HSI is committed to stopping the flow of these highly dangerous drugs into our communities and holding those who distribute this poison accountable for their actions.”
U.S. Attorney Glassman commended the investigation of this case by HSI and the Delaware County Sheriff’s Office, as well as Deputy Criminal Chief Michael Hunter, who is prosecuting the case.
A criminal complaint merely contains allegations, and the defendant is presumed innocent unless proven guilty in a court of law.
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Convicted Felon Who Assaulted and Pistol-Whipped His Fiancée Sentenced to 9 Years in Federal PrisonRead the Press Release
A Marion man who was previously convicted of felony domestic assault and who then assaulted his fiancée with a gun was sentenced June 28, 2018, to nine years in federal prison.
Gage Skola, age 28, from Marion, Iowa, received the prison term after an April 19, 2018 guilty plea to one count of being a felon in possession of a firearm.
Information at sentencing and in a previously filed criminal complaint showed that Skola got into an argument with his fiancée on February 10, 2018. During the argument, Skola grabbed a gun and pistol-whipped her in the back of the head. The fiancée fled to a neighbor’s house, but Skola followed her and forced his way into the house. In the neighbor’s house, Skola displayed a large silver handgun and pointed it at his fiancée’s head. The neighbor was able to get the gun from Skola, who then fled from the house. Officers later recovered the silver handgun, a .44 caliber Magnum, which had previously been reported stolen.
Later that same night, Skola returned to the neighbor’s house. Police returned to the house and arrested Skola. During a subsequent search of Skola’s home, officers found five spent shell casings from a .44 caliber Magnum.
Skola was sentenced in Cedar Rapids by United States District Court Judge Linda R. Reade. Skola was sentenced to 108 months’ imprisonment. He must also serve a three-year term of supervised release after the prison term. There is no parole in the federal system.
Skola is being held in the United States Marshal’s custody until he can be transported to a federal prison.
This case was brought as part of Project Safe Neighborhoods (PSN), a program that has been historically successful in bringing together all levels of law enforcement to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions has made turning the tide of rising violent crime in America a top priority. In October 2017, as part of a series of actions to address this crime trend, Attorney General Sessions announced the reinvigoration of PSN and directed all U.S. Attorney’s Offices to develop a district crime reduction strategy that incorporates the lessons learned since PSN launched in 2001.
The case is being prosecuted by Assistant United States Attorney Dan Chatham and investigated by the Marion Police Department.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file numbers are 18-cr-7 and 18-mj-48.
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Connecticut Insurance Salesman Sentenced to Prison for Tax FraudRead the Press Release
A Newington, Connecticut, insurance salesman was sentenced to 70 months in prison for tax fraud, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.
Terry DiMartino was convicted after a jury trial in March 2016 of one count of corruptly interfering with the due administration of the internal revenue laws, two counts of filing false tax returns and five counts of willfully failing to file tax returns. DiMartino was an insurance salesman for numerous insurance companies located in Connecticut and elsewhere. Despite earning millions of dollars in insurance commissions over the last decade, DiMartino did not file accurate tax returns or pay the taxes owed.
According to the evidence presented at trial, DiMartino attempted to obstruct the IRS by mailing false documents to the IRS, including three false tax returns for the 2007 tax year, one of which requested a fraudulent $14 million refund. He sent false and threatening correspondence to the IRS in an attempt to defeat the IRS’s assessment, collection and investigative efforts. He submitted false and threatening correspondence to insurance companies that sought to cooperate with the IRS collection activities. DiMartino also set up nominee entities that he used to divert his insurance commissions. He used the nominees to hide and conceal assets to prevent the IRS from collecting on his tax liabilities. DiMartino has not filed an accurate individual income tax return since the 1996 tax year.
In addition to the term of imprisonment, U.S. District Court Judge Alvin W. Thompson ordered DiMartino to serve one year of supervised release and to pay $658,547.62 in restitution to the IRS.
Principal Deputy Assistant Attorney General Zuckerman commended special agents of IRS-Criminal Investigation, who investigated the case, and Tax Division Trial Attorney Jason M. Scheff and former Tax Division Trial Attorney Erin B. Pulice, who prosecuted the case. The Tax Division expressed gratitude to the U.S. Attorney’s Office for the District of Connecticut for their assistance in the investigation and prosecution of this case.
Condolences for Alabama Attorney General Steve Marshall and FamilyRead the Press Release
In sympathy on the day of Bridgette Gentry Marshall’s funeral, U.S. Attorney Jay E. Town expresses condolences to her husband, Alabama Attorney General Steve Marshall, and their family:
“Today is another sad day for the Marshall family. We pray in hope that the family, relatives, and friends of Bridgette have full providence during this difficult time. The strength and character Steve has continued to show for his family, especially his daughter, Faith, while enduring this tragedy, has been a reassuring blessing to us all.”
Central Wisconsin Man Charged with Impersonating Federal Officer in Knox County, Ill.Read the Press Release
ROCK ISLAND, Ill. -- Trial has been scheduled on Aug. 27, 2018, for a Central Wisconsin man charged with impersonating a U.S. Marshal. Jared Keith Fulk, 20, last known address Milladore, Wis., was arraigned on June 26, in federal court in Rock Island.
The indictment, returned on June 20, alleges that on May 16, 2018, Fulk impersonated a federal officer by representing himself as a U.S. Marshal to an individual.
Fulk has remained in law enforcement custody since he was arrested on May 16, by the Galesburg Police Department. Fulk waived a federal detention hearing and will remain in the custody of the U.S. Marshals Service pending trial.
If convicted of impersonating an officer of the U.S. government, Fulk faces up to three years in prison.
The charge is the result of investigation by the Galesburg Police Department and the U.S. Marshals Service. Assistant U.S. Attorney Kevin C. Knight is prosecuting the case.
Members of the public are reminded that an indictment is merely an accusation; the defendant is presumed innocent unless proven guilty.
Canadian Who Arranged Drug Smuggling Helicopter Flights Across Northern Border Sentenced to 7 Years in PrisonRead the Press Release
A Canadian national who was extradited in January 2018 in connection with a 2008-2009 international drug smuggling scheme, was sentenced today in U.S. District Court in Seattle to seven years in prison for conspiracy to possess with intent to distribute controlled substances, announced U.S. Attorney Annette L. Hayes. COLIN HUGH MARTIN, 46, from British Columbia, Canada, was indicted in 2010 and pleaded guilty in March 2018. MARTIN, the leader of the drug smuggling ring, used the code name “Rolex,” and recruited others to fly cocaine, MDMA and marijuana across the rugged northern border. A number of his conspirators were arrested, convicted and imprisoned on related charges. MARTIN remained in Canada until his extradition on 2018. At the sentencing hearing U.S. District Judge Robert S. Lasnik said it was, “a very significant crime.”
“Mr. Martin directed the smuggling of large quantities of drugs from what seemed like a safe perch in Canada – never expecting to face the music back here in the United States,” said U.S. Attorney Annette L. Hayes. “This case demonstrates our dogged determination to find those responsible for significant drug crimes and work with our international partners to hold them to account.”
According to records filed in the case, MARTIN conspired with others to transport cocaine north across the Canadian border via helicopter. The cargo coming south was ecstasy or BC Bud marijuana. MARTIN gained a prominent role in the cross-border smuggling conspiracy following a March 2008 seizure of MDMA in Tukwila, and cocaine in California. MARTIN purchased and leased various helicopters and recruited pilots to fly the illegal drugs across the border. MARTIN also recruited others to load and off load the helicopters. MARTIN and his coconspirators used encrypted Blackberry phones and code names to communicate.
MARTIN’s plea agreement connects him to the following drug seizures: 83 kilos of cocaine that was seized in Utah in February 2009, on its way to a helicopter transport site in rural northeastern Washington; 190 kilos of marijuana flown into eastern Washington; 20 kilos of cocaine seized in Ontario, California in February 2009; and 79 kilograms of marijuana from Canada that was seized by agents from a helicopter that landed in Idaho on March 5, 2009.
Co-defendant Sean William Doak was sentenced in 2016 to seven years in prison. Other co-conspirators received sentences ranging from 18 months to ten years in prison based on their level of involvement in the drug ring.
The case was investigated by the Drug Enforcement Administration (DEA) with assistance from the Royal Canadian Mounted Police (RCMP) and the Utah Highway Patrol.
The case is being prosecuted by Assistant United States Attorney Sarah Vogel with assistance from the Department of Justice Office of International Affairs.