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Thursday 12 April 2018
Fostoria man indicted for recording himself sexually assaulting young boys and having more than 1,000 images of child pornographyRead the Press Release
A Fostoria man was indicted for recording himself sexually assaulting young boys and having more than 1,000 images of child pornography, said U.S. Attorney Justin E. Herdman and FBI Special Agent in Charge Stephen D. Anthony.
Charles Brian O’Neill, 58, was indicted for production of child pornography and receipt and distribution of child pornography.
Investigators responded to O’Neill’s house based upon a tip that he had numerous images of nude boys between the ages of 2 and 17. Investigators located child pornography on O’Neill’s phone and arrested him. A subsequent search of O’Neill’s barn on Bairdstown Road in Wood County contained sexual paraphernalia, condoms and sex toys, as well as children’s costumes, according to court documents.
A review of a computer in the barn showed a video of O’Neill performing sex acts on a prepubescent male. Another video shows O’Neill performing sex acts on a prepubescent male inside a bedroom, according to court documents.
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case was investigated by the Federal Bureau of Investigation and Fostoria Police Department. It is being prosecuted by Assistant U.S. Attorney Tracey Ballard Tangeman.
An indictment is only a charge and is not evidence of guilt. Defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Fort Dix Correctional Officer Charged with Accepting Bribes in Exchange for Delivering Contraband to InmatesRead the Press Release
NEWARK, N.J. – A corrections officer was arrested for allegedly accepting cash bribes in exchange for delivering contraband to inmates at Federal Correctional Institution Fort Dix (FCI Fort Dix), U.S. Attorney Craig Carpenito and Special Agent in Charge Ronald G. Gardella of the U.S. Department of Justice Office of the Inspector General, New York Field Division, announced today.
Paul Anton Wright, 32, of Berlin, New Jersey, was arrested by federal agents this morning and charged by complaint with agreeing to accept and accepting bribes. Wright appeared this afternoon before U.S. Magistrate Judge Michael A. Hammer in Newark federal court and was released on $100,000 unsecured bond.
According to the complaint:
In 2015, Wright, a corrections officer at FCI Fort Dix, allegedly smuggled contraband, including K2 synthetic marijuana and suboxone, a Schedule III narcotic used to treat opioid addiction, to inmates inside FCI Fort Dix. Wright received the contraband and cash bribes from two individuals outside of FCI Fort Dix.
For instance, between February and September 2015, Wright received thousands of dollars in cash payments from the relative of an FCI Fort Dix inmate and subsequently delivered contraband, including K2, to the inmate. According to bank records, on Feb. 19, 2015, there was a $2,500 cash withdrawal from the relative’s bank account and a $2,500 deposit into Wright’s bank account the following day. There were also three phone calls between Wright and the relative during this two-day period. On other occasions, the cash payments were deposited into Wright’s bank accounts or used by Wright for cash buy-ins at the Borgata casino in Atlantic City, New Jersey.
In addition, between October and December 2015, Wright received thousands of dollars in cash payments from the relative of an inmate’s girlfriend. Wright met with this relative in Bronx, New York, on multiple occasions, and on each occasion, Wright accepted contraband and cash. He subsequently delivered the contraband to an inmate at FCI Fort Dix.
The bribery count with which Wright is charged carries a maximum potential penalty of 15 years in prison and a $250,000 fine.
The charge and allegations in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
U.S. Attorney Carpenito credited special agents of the U.S. Department of Justice Office of the Inspector General, New York Field Division, under the direction of Special Agent in Charge Gardella, with the investigation leading to today’s arrest.
The government is represented by Assistant U.S. Attorney Rahul Agarwal, Deputy Chief of the U.S. Attorney’s Office Criminal Division.
18-153
Defense counsel: Linda Foster Esq., Assistant Federal Public Defender, Newark
Former U.S. Congressman Convicted of Mail and Wire Fraud, Campaign Finance Violations, Money Laundering and Filing a False Tax ReturnRead the Press Release
A federal jury convicted former U.S. Representative Stephen E. Stockman for orchestrating a scheme to steal hundreds of thousands of dollars from charitable foundations and the individuals who ran those foundations to illegally finance Stockman’s campaigns for public office and to pay for his and others’ personal expenses. Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, U.S. Attorney Ryan K. Patrick of the Southern District of Texas, Assistant Director in Charge Nancy McNamara of the FBI's Washington Field Office and Special Agent in Charge D. Richard Goss of Internal Revenue Service-Criminal Investigation’s (IRS-CI) Houston Field Office made the announcement.
Stockman, 61, of Clear Lake, Texas, was convicted of seven counts of mail and wire fraud, one count of conspiracy to make conduit campaign contributions and false statements to the Federal Election Commission (FEC), one count of making coordinated excessive campaign contributions, two counts of making false statements to the FEC, 11 counts of money laundering and one count of filing a false tax return. Thomas Dodd, 38, of the Houston, Texas area, a former special assistant in Stockman’s congressional office, and Jason Posey, 46, formerly of Houston, a former Stockman congressional staffer, previously pleaded guilty to their involvement in the scheme.
“Stephen Stockman abused his position as United States Congressman to defraud charitable donors and then used the proceeds of his crimes to corrupt the election process and make a range of impermissible personal expenditures,” said Acting Assistant Attorney General Cronan. “The Criminal Division is committed to preserving the public’s confidence in our government by investigating and prosecuting corrupt public officials. We also will continue to address the threat that illegal coordinated campaign contributions pose to the integrity of federal elections, and aggressively pursue these offenses at every appropriate opportunity.”
“This case was a fantastic collaboration between the Southern District of Texas and the Department of Justice’s Criminal Division,” said U.S. Attorney Patrick. “When public officials use their office to defraud donors and violate federal law, we will hold them accountable. Corrupt officials like former congressman Stockman make it harder for the honest ones to do their jobs.”
“Former Representative Stockman used his position as a Member of Congress to fraudulently solicit charitable donations for the purpose of keeping himself in public office,” said Assistant Director McNamara. “Today’s verdict shows that no one is above the law and the FBI and our partners will thoroughly investigate all allegation of violations of federal election system.”
“The integrity of our political system is paramount to maintaining our way of life,” said Special Agent in Charge Goss. “IRS-CI Agents along with the assistant of our Federal partners unraveled a scheme in which Stockman diverted considerable funds intended for charitable organizations for his own purposes that included funding his campaign.” This type of behavior undermines our democracy and cannot be tolerated.”
According to the evidence presented at trial, from May 2010 to October 2014, Stockman solicited and obtained approximately $1.25 million in donations based on false pretenses. Specifically, in 2010, Stockman diverted a significant portion of $285,000 in charitable donations to pay for his and Dodd’s own personal expenses and to further Stockman’s own interests. The evidence at trial established that in 2011 and 2012, Stockman and Dodd received an additional $165,000 in charitable donations, much of which Stockman used to finance his 2012 congressional campaign.
According to the evidence at trial, shortly after Stockman took office in the U.S. House of Representatives in 2013, he and Dodd used the name of a nonprofit entity to solicit and receive a $350,000 charitable donation. Stockman used this donation for a variety of personal and campaign expenses, including illegal conduit campaign contributions, a covert surveillance project targeting a perceived political opponent and payments associated with Stockman’s U.S. Senate campaign in early 2014.
Trial evidence also demonstrated that in connection with Stockman’s Senate campaign, Posey used a nonprofit entity to secure a $450,571 donation in order to fund a purported independent expenditure for a mass-mailing project attacking Stockman’s opponent. In reality, the independent expenditure was directed and supervised by Stockman. Only approximately half of the donation was spent on the mail campaign, and Posey used a portion of the unspent balance to pay for expenses associated with Stockman’s Senate campaign and to fund personal expenses.
Stockman was taken into custody following the return of the verdict. Sentencing has been set for Aug. 17.
The FBI and IRS-CI conducted the investigation. Assistant U.S. Attorney Melissa Annis of the Southern District of Texas and Trial Attorneys Ryan J. Ellersick and Robert J. Heberle of the Criminal Division’s Public Integrity Section are prosecuting the case.
Former Puerto Rico Senator and Businessman Sentenced to Prison for BriberyRead the Press Release
Former Puerto Rico Senator Hector Martinez Maldonado and Juan Bravo Fernandez, the former president of Ranger American, one of the largest private security companies in Puerto Rico, were each sentenced today to 48 months in prison, respectively, for their roles in a bribery scheme involving the passage of legislation beneficial to Bravo Fernandez’s business, announced Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division.
Martinez Maldonado, 49, of Carolina, Puerto Rico, and Bravo Fernandez, 63, of San Juan, were each sentenced by Judge Francisco A. Besosa. Judge Besosa also ordered Bravo Fernandez to pay a $150,000 fine and Martinez Maldonado to pay a $15,000 fine. Maldonado and Fernandez were convicted on May 26, 2017, of federal program bribery.
According to evidence presented at trial, Martinez Maldonado was elected to the Puerto Rico Senate in 2004 and began serving a four-year term in January 2005. He was reelected in 2008. Beginning in 2005, Martinez Maldonado served as Chairman of the Puerto Rico Public Safety Committee, exercising significant control over legislation related to security and community safety. Bravo Fernandez was the president and chief executive officer of Ranger American, one of the largest private security firms in Puerto Rico.
The jury convicted the defendants for their role in a bribery scheme in which Bravo Fernandez provided Martinez Maldonado and Jorge de Castro Font, another former Puerto Rico senator, with a trip to Las Vegas to watch a championship boxing match between Winky Wright and Felix “Tito” Trinidad, a legendary Puerto Rican boxer, in exchange for the senators’ help with legislation favorable to Bravo Fernandez’s business interests.
Documents and evidence presented at trial showed that the trip to Las Vegas included first-class airfare; meals and drinks; hotel rooms at the Mandalay Bay Resort and Casino; $1,000 tickets to the Trinidad vs. Wright boxing match; and hotel rooms in Miami for the return trip. On March 2, 2005, the day that Bravo Fernandez paid for the boxing tickets, Martinez Maldonado submitted one of the bills favorable to Bravo Fernandez for consideration by the Puerto Rico Senate. The evidence at trial also showed that the hotel reservation was made the day after Martinez Maldonado presided over a Public Safety Committee hearing for one of the bills at which Bravo Fernandez testified, and that, the day after the three men returned from their trip to Las Vegas, Martinez Maldonado and de Castro Font both cast their votes in support of one of Bravo Fernandez’s bills in the Senate.
De Castro Font, 54, served in the Puerto Rico House of Representatives from 1989 to 2004, and served in the Puerto Rico Senate from 2005 to 2008. De Castro Font pleaded guilty on Jan. 21, 2009, to 20 counts of honest services wire fraud and one count of conspiracy to commit extortion. He was sentenced on May 17, 2011, to 60 months in prison.
The case is being investigated by the FBI’s San Juan Office. The case is being prosecuted by Deputy Chief Peter Koski and Trial Attorneys Monique Abrishami and Gwendolyn Stamper of the Criminal Division’s Public Integrity Section.
Former Local Judge Charged with Soliciting Sexual Contact in Exchange for Favorable Action on Traffic OffencesRead the Press Release
WASHINGTON – A former local probate judge for Hart County, Georgia, was charged in an indictment today for soliciting sexual contact in exchange for favorable action on driving under the influence charges and other traffic offenses, announced Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, U.S. Attorney Charles E. Peeler of the Middle District of Georgia and Special Agent in Charge David J. Levalley of the FBI’s Atlanta Division.
Bobby Joe Smith, 77, of Hartwell, Georgia, was charged with one count of bribery and three counts of civil rights violations in an indictment filed today in the Middle District of Georgia. Smith is expected to have his initial appearance on Wednesday, April 25.
According to the allegations in the indictment, between May 2013 and May 2014, Smith met separately with three different women in his office regarding driving under the influence charges and/or other traffic offenses. During these meetings, each of the women sought Smith’s assistance in reducing or eliminating her charges and potential punishments in these matters. Smith allegedly kissed the first woman on the lips and groped her multiple times without her consent. Smith subsequently reduced the charges and punishments for all of her pending offenses. During meetings with the second woman, Smith allegedly kissed her on the lips, groped her, and exposed himself. The woman’s charges were ultimately resolved by another judge after Smith left office. To help the third woman with a speeding ticket she received in another county, Smith allegedly left a message for a probate judge in that county, providing details about the woman’s citation and falsely claiming that the woman was his granddaughter. After placing the phone call, Smith allegedly kissed the woman on the lips and attempted to grope her. According to the indictment, none of these three women consented to Smith’s sexual advances.
The charges and allegations contained in an indictment are merely accusations. The defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The case was investigated by the FBI’s Athens Resident Agency. Trial Attorney Heidi Boutros Gesch of the Criminal Division’s Public Integrity Section and Deputy Criminal Chief Danial Bennett of the U.S. Attorney’s Office for the Middle District of Georgia are prosecuting the case.
Former Local Judge Charged with Soliciting Sexual Contact in Exchange for Favorable Action on Traffic OffensesRead the Press Release
A former local probate judge for Hart County, Georgia, was charged in an indictment today for soliciting sexual contact in exchange for favorable action on driving under the influence charges and other traffic offenses, announced Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, U.S. Attorney Charles E. Peeler of the Middle District of Georgia and Special Agent in Charge David J. Levalley of the FBI’s Atlanta Division.
Bobby Joe Smith, 77, of Hartwell, Georgia, was charged with one count of bribery and three counts of civil rights violations in an indictment filed today in the Middle District of Georgia. Smith is expected to have his initial appearance on Wednesday, April 25.
According to the allegations in the indictment, between May 2013 and May 2014, Smith met separately with three different women in his office regarding driving under the influence charges and/or other traffic offenses. During these meetings, each of the women sought Smith’s assistance in reducing or eliminating her charges and potential punishments in these matters. Smith allegedly kissed the first woman on the lips and groped her multiple times without her consent. Smith subsequently reduced the charges and punishments for all of her pending offenses. During meetings with the second woman, Smith allegedly kissed her on the lips, groped her, and exposed himself. The woman’s charges were ultimately resolved by another judge after Smith left office. To help the third woman with a speeding ticket she received in another county, Smith allegedly left a message for a probate judge in that county, providing details about the woman’s citation and falsely claiming that the woman was his granddaughter. After placing the phone call, Smith allegedly kissed the woman on the lips and attempted to grope her. According to the indictment, none of these three women consented to Smith’s sexual advances.
The charges and allegations contained in an indictment are merely accusations. The defendant is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The case was investigated by the FBI’s Athens Resident Agency. Trial Attorney Heidi Boutros Gesch of the Criminal Division’s Public Integrity Section and Deputy Criminal Chief Danial Bennett of the U.S. Attorney’s Office for the Middle District of Georgia are prosecuting the case.
Former Idaho Resident Indicted for Preparing Fraudulent Income Tax ReturnsRead the Press Release
BOISE – A federal grand jury indicted David Brannum, 55, of Washougal, Washington, and formerly of Caldwell, Idaho, for preparing false income tax returns, U.S. Attorney Bart M. Davis announced.
Brannum operated a tax preparation business called “Dave’s Tax Service” in Idaho in tax years 2011, 2012, and 2013. The indictment alleges that Brannum falsified certain itemized deductions in his clients’ federal income tax returns to improperly decrease their tax liability and to inflate their tax refunds. Many clients were subsequently audited and paid back taxes and penalties. The indictment charges Brannum with thirty-one counts of aiding and assisting in the filing of false and fraudulent income tax returns.
Aiding and assisting in the filing of fraudulent federal income tax returns is punishable by up to three years in prison, a $250,000 fine, and up to one year of supervised release.
The case was investigated by the IRS Criminal Investigations division.
An indictment is a means of charging a person with criminal activity. It is not evidence. A person is presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
Former Federal Correctional Officer Indicted for Making False StatementsRead the Press Release
Ocala, Florida – United States Attorney Maria Chapa Lopez announces the unsealing of an indictment charging Heather Lee Kussoff (31, Cape Coral) with making a false statement to a federal law enforcement agency. If convicted, she faces a maximum penalty of five years in federal prison.
According to the indictment and information presented in court, Kussoff worked as a correctional officer at the Coleman Federal Correctional Complex (FCC) in Sumter County. In 2014, she developed a personal relationship with an inmate at one of the penitentiaries. In direct violation of her job responsibilities and training, Kussoff corresponded with the inmate in a romantic capacity, shared extensive details of her personal life, and communicated directly with members of the inmate’s family. When confronted by federal authorities in March 2015, Kussoff lied under oath about the existence of the relationship and then abruptly resigned from the Bureau of Prisons.
An indictment is merely a formal charge that a defendant has violated one or more of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the Department of Justice – Office of the Inspector General, the Federal Bureau of Prisons, and the Federal Bureau of Investigation. It will be prosecuted by Assistant United States Attorney Robert E. Bodnar, Jr.
Former Employee of New Jersey Bank and Two Others Charged with Stealing Client Information and FundsRead the Press Release
Geoffrey S. Berman, the United States Attorney for the Southern District of New York, Patricia Tarasca, the Special Agent-in-Charge of the New York Region for the Federal Deposit Insurance Corporation (“FDIC”) Office of Inspector General, and Ruth M. Mendonca, the Acting Postal Inspector-in-Charge of the Newark Division of the United States Postal Inspection Service (“USPIS”), announced the unsealing today of an indictment charging SECONEY BROWN, ANTOINETTE MITCHELL-BROWN, a/k/a “Antoinette Mitchell-Morgan,” and ANTHONY ATKINSON with conspiracy to commit bank fraud and aggravated identity theft, in connection with a scheme to fraudulently obtain more than $700,000 from clients of a bank in New Jersey (“Bank-1”), at which MITCHELL-BROWN was employed during the scheme. BROWN, MITCHELL-BROWN, and ATKINSON were arrested today and will be presented later today before U.S. Magistrate Judge Robert W. Lehrburger. The case has been assigned to U.S. District Judge Gregory H. Woods.
U.S. Attorney Geoffrey S. Berman said: “Antoinette Mitchell-Brown allegedly stole client information from a bank at which she was employed and, with the help of Seconey Brown and Anthony Atkinson, used that information in an attempt to steal hundreds of thousands of dollars from the very customers Mitchell-Brown was supposed to be serving. Thanks to the work of the FDIC Office of Inspector General and the USPIS, the defendants’ alleged scheme has now been exposed.”
FDIC Special Agent-in-Charge Patricia Tarasca said: “This indictment unsealed today holds the three defendants accountable for stealing bank account information from innocent victims and aiming to transfer more than $600,000 for their personal gain. We are pleased to work with our law enforcement partners to investigate such matters of identity theft, as a way to protect banks from such abuses and the system’s integrity.”
Acting Postal Inspector-in-Charge Ruth M. Mendonca said: “Through disguise and deceit, these defendants created an elaborate bank fraud scheme to defraud financial institutions and their customers. The use of the U.S. Mail to facilitate any fraud scheme will never be tolerated by U.S. Postal Inspectors, who will continue to aggressively pursue these types of investigations.”
According to the allegations in the Indictment[1]:
From at least September 2016 until at least December 2016, MITCHELL-BROWN, BROWN, and ATKINSON engaged in a scheme to fraudulently obtain funds from more than 25 accounts at Bank-1, at which MITCHELL-BROWN was then employed. In furtherance of the scheme, MITCHELL-BROWN stole victims’ bank account information from her employer and used that information to, among other things, write checks for thousands of dollars from victims’ accounts and initiate wire transfers from victims’ accounts to bank accounts controlled by members of the scheme. BROWN and ATKINSON, among other things, paid members of the scheme or otherwise induced other individuals (some of whom provided unwitting assistance) to cash or deposit the fraudulent checks from MITCHELL-BROWN, and provide the proceeds to BROWN, ATKINSON, or, at BROWN and ATKINSON’s direction, other individuals. In total, the defendants’ scheme fraudulently obtained more than $77,000 and attempted to obtain at least an additional $660,000.
* * *
BROWN, 25, and MITCHELL-BROWN, 41, both of East Orange, New Jersey, and ATKINSON, 22, of the Bronx, New York, are each charged with one count of conspiracy to commit bank fraud, which carries a maximum sentence of 30 years in prison, and one count of aggravated identity theft, which carries a mandatory sentence of two years in prison. The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendants will be determined by the assigned judge.
Mr. Berman praised the outstanding investigative work of the FDIC Office of Inspector General and the USPIS. Mr. Berman also thanked United States Immigration and Customs Enforcement’s Homeland Security Investigations and the East Orange Police Department for their assistance in the investigation.
If you believe you were a victim of this crime, including a victim entitled to restitution, and you wish to provide information to law enforcement and/or receive notice of future developments in the case or additional information, please contact the Victim/Witness Unit at the United States Attorney’s Office for the Southern District of New York, at (866) 874-8900. For additional information, go to http://www.usdoj.gov/usao/nys/victimwitness.html.
This case is being handled by the Office’s General Crimes Unit. Assistant United States Attorneys Louis A. Pellegrino and Robert B. Sobelman are in charge of the prosecution.
The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
[1] As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth herein constitute only allegations, and every fact described should be treated as an allegation.
Former Chief Financial Officer of “Soup Nazi” Business Sentenced to 9 Months’ Imprisonment for Tax EvasionRead the Press Release
Earlier today, in federal court in Brooklyn, Robert N. Bertrand, the Former Chief Financial Officer of Soupman, Inc. (“Soupman”), was sentenced by United States District Judge Pamela K. Chen to nine months’ imprisonment for failure to pay Medicare, Social Security and federal income taxes, to be followed by a one year term of supervised release. Soupman, which is based on Staten Island, licenses its name and recipes from Al Yeganeh, the inspiration for the “Soup Nazi” character on the television series “Seinfeld.” The Court also ordered Bertrand to pay $78,518.18 in restitution to the United States. Bertrand pleaded guilty in December 2017.
Richard P. Donoghue, United States Attorney for the Eastern District of New York, and James D. Robnett, Special Agent in Charge, Internal Revenue Service Criminal Investigation, New York (IRS-CI), announced the sentence.
According to court filings and facts presented during court proceedings, as Soupman’s CFO, Bertrand had a corporate responsibility to collect, truthfully account for and pay Medicare, Social Security and federal income taxes for Soupman’s employees. Between 2010 and 2014, Bertrand made unreported payments to Soupman employees, and compensated certain employees in large unreported stock awards. Bertrand never reported this employee compensation to the IRS, and never paid Medicare, Social Security and federal income taxes on the side payments or the stock awards, despite a 2012 warning from an external auditor that these payments should be reported to the IRS. From 2010 through 2014, Soupman’s total approximate unreported cash and stock compensation was more than $2.85 million, and the total approximate tax loss to the United States was in excess of $593,000.
“Bertrand has been held to account for abusing his position as the CFO of a publicly traded company in a long-running scheme that cheated the nation’s treasury out of hundreds of thousands of dollars,” stated United States Attorney Donoghue. “Today’s sentencing makes clear that this Office, with our partners at the IRS, will pursue corporate gatekeepers like the defendant who fail to enforce their companies’ tax obligations.”
“Corporate executives such as Mr. Bertrand have a responsibility to collect and turn over all IRS withholding taxes,” stated IRS-CI Special Agent-in-Charge Robnett. “His failure to withhold and pay over is a clear violation that directly impacts those employees of Soupman Inc. and U.S. taxpayers now and in the future. Today justice is served, and Mr. Bertrand is being held accountable for his criminal actions.”
The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorney Kaitlin T. Farrell is in charge of the prosecution.
The Defendant:
Robert N. Bertrand
Age: 63
Norwalk, ConnecticutE.D.N.Y. Docket No. 17-CR-186
Former Airline Employee Sentenced for Hacking PenAir’s Ticketing and Reservations SystemRead the Press Release
Anchorage, Alaska – U.S. Attorney Bryan Schroder announced today that a former airline employee has been sentenced in federal court for hacking PenAir’s ticketing and reservation system between April and May 2017.
Suzette Kugler, 59, of Desert Hot Springs, California, was sentenced today by U.S. District Judge Sharon L. Gleason, to serve five years of probation, and 250 hours of community service. Kugler, who has no prior criminal history, previously pleaded guilty as charged to the felony offense on Jan. 26, 2018, to one count of fraud in connection with computers. As part of the plea agreement, Kugler agreed to pay $5,616 in restitution to PenAir, paid in full by the time of sentencing.
According to court documents, Kugler was a long-time employee of PenAir, who parted ways with the company in February 2017, dissatisfied with the circumstances surrounding her departure. During her employment, Kugler had administered PenAir’s Sabre database system, which the airline depended on for ticketing and reservations. The investigation revealed that, upon retirement, Kugler used her specialized knowledge regarding the Sabre database to create fake employee accounts with high-level privileges, without authorization, and then used those accounts to destroy critical information in a series of network intrusions. It was discovered that the primary fake employee account used in the intrusions was created by Kugler a week before she left the company.
Kugler’s unauthorized network intrusions were intended to prevent employees in any of the eight airports serviced by PenAir from being able to book, ticket, modify, or board any flight until the stations were again added in the system. PenAir personnel worked through the night to bring the stations back online.
The Court at sentencing commended PenAir for remediating the damage caused by Kugler before it resulted in significant disruption for air travelers in Alaska and other states.
Special Agents with the Cyber Unit of the Anchorage Division of the Federal Bureau of Investigation (“FBI”) conducted the investigation leading to the successful prosecution of this case. This case was prosecuted by Assistant U.S. Attorney Adam Alexander.
Florida Escort Service Owner Pleads Guilty to Underreporting IncomeRead the Press Release
A Miami escort service owner pleaded guilty today to filing a false tax return, announced U.S. Attorney Benjamin G. Greenberg for the Southern District of Florida and Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division.
According to court documents, Dennis Zarudny, 40, filed a false individual income tax return for 2011 that underreported his total income from his escort business, Denzar Inc., which did business as “Elite Escort Service” in the Miami area. Zarudny’s escort service was marketed on the internet as a “prestigious escort agency providing 24 hour outcall escort services & adult entertainment for upscale gentlemen and couples in South Florida.”
For tax years 2011 through 2014, Zarudny filed false corporate and personal income tax returns with the IRS, which substantially underreported his business’ income. Zarudny allowed his customers to pay for the escorts’ services by cash, check, and credit card. Zarudny reported income from credit card transactions, but did not fully report the income he received from customers who paid in cash and check.
U.S. District Judge Jose E. Martinez scheduled sentencing for June 11. Zarudny faces a statutory maximum sentence of three years in prison, as well as a period of supervised release, monetary penalties and restitution.
U.S. Attorney Greenberg and Principal Deputy Assistant Attorney General Zuckerman commended special agents of IRS Criminal Investigation, who investigated the case, and Assistant U.S. Attorney Joshua Rothstein and Tax Division Trial Attorney Grace Albinson, who are prosecuting this case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at http://www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Florida Escort Service Owner Pleads Guilty to Underreporting IncomeRead the Press Release
A Miami escort service owner pleaded guilty today to filing a false tax return, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Benjamin G. Greenberg for the Southern District of Florida.
According to court documents, Dennis Zarudny, 40, filed a false individual income tax return for 2012 that underreported his total income from his escort business, Denzar Inc., which did business as “Elite Escort Service” in the Miami area. Zarudny’s escort service was marketed on the internet as a “prestigious escort agency providing 24 hour outcall escort services & adult entertainment for upscale gentlemen and couples in South Florida.”
For tax years 2011 through 2014, Zarudny filed false corporate and personal income tax returns with the IRS, which substantially underreported his business’ income. Zarudny allowed his customers to pay for the escorts’ services by cash, check, and credit card. Zarudny reported income from credit card transactions, but did not fully report the income he received from customers who paid in cash and check.
U.S. District Judge Jose E. Martinez scheduled sentencing for June 11. Zarudny faces a statutory maximum sentence of three years in prison, as well as a period of supervised release, monetary penalties, and restitution.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Greenberg commended special agents of IRS Criminal Investigation, who investigated the case, and Assistant U.S. Attorney Joshua Rothstein and Tax Division Trial Attorney Grace Albinson, who are prosecuting this case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
Filipino Woman Pleads Guilty to Passport FraudRead the Press Release
Bangor, Maine: United States Attorney Halsey B. Frank announced that Emelita Ignacio Arindela, a/k/a “Esperanza Ignacio Arindela,” “Esperanza Hooper,” Emily I. Arindela,” and “Emily Ingacio Arindela,” 43, of Mount Desert Island, Maine, and previously of the Philippines, pleaded guilty today in U.S. District Court to passport fraud.
According to court records, in 2000, the defendant assumed the name and date of birth of her older sister in order to marry a U.S. citizen in the City of Valenzuela, Philippines. In 2002, she entered the United States under her sister’s identity. In 2009, she became a naturalized U.S. citizen using her sister’s identity. Later that year, she legally changed her name to Emily I. Arindela. In 2010, she applied for a U.S. passport using her new name and her sister’s date of birth.
The defendant faces up to 10 years in prison and a $250,000 fine. She will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
The case was investigated by the Diplomatic Security Service of the U.S. Department of State.
Federal Inmates at USP Canaan Charged with Assaulting Fellow InmateRead the Press Release
SCRANTON – The United States Attorney’s Office for the Middle District of Pennsylvania announced today that Jesus Chavez, age 27 and Rudy Mendoza age 33, both federal inmates at the United States Penitentiary Canaan (“USP Canaan”), located in Waymart, Pennsylvania, were indicted on April 10, 2018, by a federal grand jury with assaulting another inmate with a dangerous weapon.
According to United States Attorney David J. Freed, the indictment alleges that Chavez and Mendoza assaulted a fellow inmate at USP Canaan on June 17, 2017. Both inmates were also charged with possessing a homemade weapon fashioned from a sharpened piece of metal, commonly known as a “shank.”
The investigation was conducted by the Federal Bureau of Investigation and officers from USP Canaan. The case is being prosecuted by Assistant United States Attorney Evan Gotlob.
Indictments are only allegations. All persons charged are presumed to be innocent unless and until found guilty in court.
A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.
The maximum penalty under federal law is 15 years of imprisonment a term of supervised release following imprisonment, and a fine. Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant’s educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.
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Federal Inmate Pleads Guilty to Possession of a WeaponRead the Press Release
BECKLEY, W.Va. – United States Attorney Mike Stuart announced today that an inmate at the Beckley Federal Correctional Institution (FCI) pled guilty to possession of a weapon. Coleman Ferrell, 31, an inmate at FCI Beckley, pled guilty to possession of a weapon by a federal inmate.
Stuart praised the work of the Bureau of Prisons (BOP).
“This was a very serious situation that could have led to tragedy for prison staff and other inmates,” said United States Mike Stuart. “My team is committed to working with the Bureau of Prisons to prosecute these cases.”
Ferrell admitted that on December 22, 2017, he possessed a handcrafted weapon known as a “shank” inside FCI Beckley. He faces up to five years in prison when he is sentenced on July 18, 2018.
United States District Court Judge Irene C. Berger presided over the plea hearing. Assistant United States Attorney John File is handling the prosecution.
Follow us on Twitter: @SDWVNews and @USAttyStuart
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Federal Indictment Targets Multi-State Methamphetamine OperationRead the Press Release
United States Attorney Brandon Fremin announced today the unsealing of a federal grand jury indictment arising from an extensive federal, state, and local criminal investigation into a multi-state methamphetamine drug organization operating in Ascension Parish and elsewhere.
The indictment charges eight individuals with various federal narcotics and weapons charges spanning from September 2014 through December 2016, including a conspiracy to distribute methamphetamine throughout Ascension Parish. If convicted, each defendant faces significant incarceration, fines, restitution, forfeiture, and supervised release following incarceration.
The following individuals are charged in the indictment:
- EDWARD DANIEL BAROWSKY, a.k.a. “Ed,” age 49, of Glendale, Arizona, is charged with conspiracy to distribute and possess with intent to distribute 50 grams or more of methamphetamine, distribution of heroin, and three counts of distribution of 50 grams or more of methamphetamine.
- FRANK H. ASHFORD, III, age 48, of Prairieville, Louisiana, is charged with possession with intent to distribute 5 grams or more of methamphetamine and possession of firearms in furtherance of a drug trafficking crime.
- DWAYNE K. BRAUD, a.k.a. “Bandit,” age 40, of Baton Rouge, Louisiana, is charged with conspiracy to distribute and possess with intent to distribute 50 grams or more of methamphetamine, distribution of 5 grams or more of methamphetamine, possession with intent to distribute 50 grams or more of methamphetamine, and possession of firearms in furtherance of a drug trafficking crime.
- JACEY E. BRAUD, age 37, of Gonzales, Louisiana, is charged with conspiracy to distribute and possess with intent to distribute 50 grams or more of methamphetamine.
- RONALD COOPER, age 48, of St. Amant, Louisiana, is charged with conspiracy to distribute and possess with intent to distribute 50 grams or more of methamphetamine and possession with intent to distribute 50 grams or more of methamphetamine.
- CHELSEA M. SANFORD, age 26, of St. Amant, Louisiana, is charged with conspiracy to distribute and possess with intent to distribute 50 grams or more of methamphetamine, possession with intent to distribute 50 grams or more of methamphetamine, and possession of a firearm in furtherance of a drug trafficking crime.
- DONALD RAY. SANFORD, age 40, of Baton Rouge, Louisiana, is charged with conspiracy to distribute and possess with intent to distribute 50 grams or more of methamphetamine, distribution of 50 grams or more of methamphetamine, possession of firearms in furtherance of a drug trafficking crime, and possession of firearms by a convicted felon.
- JIMMY WHITE, age 33, of Amite City, Louisiana, is charged with conspiracy to distribute and possess with intent to distribute 50 grams or more of methamphetamine and possession with intent to distribute 50 grams or more of methamphetamine.
United States Attorney Brandon Fremin stated, “Unfortunately the unprecedented number of drug overdoses in our country is not limited to opioids. Methamphetamine overdose deaths are occurring at historic rates, with increasingly organized and efficient domestic and international operations fueling the surge by providing higher purities at lower prices. We must and will aggressively pursue and meet the multi-pronged drug threats facing our communities. I commend the outstanding efforts of the DEA, IRS-CI, the Ascension and Livingston Parish Sheriffs’ Offices, and my staff on this important matter.”
Brad L. Byerley, the Assistant Special Agent-in-Charge of the U.S. Drug Enforcement Administration Baton Rouge District Office stated, “Through remarkable partnerships with federal, state and local law enforcement, we are making major progress in preventing methamphetamine trafficking from taking hold in our communities. This investigation and these indictments are a compelling example of that success.”
This operation was conducted as part of the Organized Crime Drug Enforcement Task Force (OCDETF) Program, which was established in 1982 to mount a comprehensive attack against organized drug traffickers. Today, the OCDETF Program is the centerpiece of the United States Attorney General’s drug strategy to reduce the availability of drugs by disrupting and dismantling major drug trafficking organizations and money laundering organizations and related criminal enterprises. The OCDETF Program operates nationwide and combines the resources and unique expertise of numerous federal, state, and local agencies in a coordinated attack against major drug trafficking and money laundering organizations.
This matter is being handed by the U.S. Attorney’s Office for the Middle District of Louisiana in conjunction with Drug Enforcement Administration, Ascension Parish Sheriff’s Office, Livingston Parish Sheriff’s Office, and the Internal Revenue Service—Criminal Investigation Division. Assistant U.S. Attorney Jamie A. Flowers, Jr. is prosecuting the case.
NOTE: An indictment is an accusation by the Grand Jury. The defendants are presumed innocent until and unless adjudicated guilty at trial or through a guilty plea.
Federal Authorities Move Against Fraudulent Tax Return Preparers and Remind All Taxpayers of their Tax Season ResponsibilitiesRead the Press Release
LOS ANGELES – As the tax filing season comes to an end, federal authorities are reminding members of the public of their obligation to timely file accurate tax documents – and that evading taxes or defrauding the Internal Revenue Service can led to substantial fines, penalties and prison sentences.
Taxpayers are also reminded to be on the lookout for unscrupulous tax return preparers who may seek to inflate refunds by falsifying deductions and other fraudulent means. Even if a tax return preparer makes an error on an individual’s tax return, it is still the taxpayer’s responsibility to pay the correct taxes.
As part of their year-round efforts to combat tax fraud, federal prosecutors with the United States Attorney’s Office have worked tirelessly with special agents at the Los Angeles Field Office of IRS Criminal Investigation to investigate and prosecute those who illegally evade their taxes. Today, they are announcing a series of cases targeting tax return preparers who allegedly defrauded the IRS by filing fraudulent returns.
“Corrupt tax return preparers compromise the tax system, harming their clients, other taxpayers and the United States government,” said United States Attorney Nicola T. Hanna. “The defendants recently charged by my office are accused of breaking a fundamental trust with their clients, and their actions place themselves and their clients into legal jeopardy.”
“Income tax return preparers are a vital part of the U.S. tax system. About 56 percent of taxpayers use tax professionals to prepare their returns,” stated IRS Criminal Investigation Special Agent in Charge R. Damon Rowe. “Selecting the right tax professional is critically important because taxpayers are ultimately responsible for what they submit on their tax return.”
Today, the United States Attorney’s Office and IRS Criminal Investigation announced three criminal cases targeting income tax return preparers.
L.A. County Social Services Employee Pleads Guilty to Tax Refund Fraud Scheme
A Los Angeles County employee pleaded guilty on Wednesday to engaging in a scheme to defraud the Internal Revenue Service through the submission of fraudulent federal income tax returns.
Roberta Josephine Yashu, who also goes by Roberta Josephine Beltran, 36, who was an employee of the Los Angeles County Department of Public Social Services (DPSS), pleaded guilty before United States District Judge Dolly M. Gee to one count of conspiracy to commit wire fraud through the preparation and filing of false income tax returns.
According to a plea agreement filed in this case, Yashu filed income tax returns on behalf of family members and friends that contained false information on dependent children, as well as altered or fictitious earned income. The fraudulent tax returns, filed for a number of years through the beginning of 2016, sought inflated tax refunds.
Yashu obtained the names and Social Security numbers of the children she falsely listed as dependents on the tax returns she prepared through a database she had access to during her employment at DPSS.
Yashu often kept the fraudulent refunds for herself. As a result of the fraudulent tax returns she filed, Yashu defrauded IRS out of at least $175,305.
Yashu faces a statutory maximum sentence of 20 years in federal prison and a $1 million fine when she sentenced by Judge Gee on August 15.
This case is the product of an investigation by IRS Criminal Investigation, which received assistance from the Los Angeles County Office of County Investigations.
The case is being prosecuted by Assistant United States Attorney Andrew Brown of the Major Frauds Section.
Inglewood Return Preparer Arrested on Tax Fraud Charges
The operator of a tax preparation business, the Inglewood-based Ultimate Professional Services, was arrested Wednesday morning on charges that she prepared and filed fraudulent income tax returns for her clients.
Karen McCoy, 69, of Compton, was charged in an indictment returned Tuesday by a federal grand jury. The indictment charges McCoy with 31 counts of aiding and assisting in the preparation of false tax returns.
The indictment alleges that McCoy prepared and filed 31 tax returns on behalf of 18 different clients which claimed false deductions. McCoy allegedly prepared tax returns containing inflated deductions that the taxpayers were not entitled to take.
For the 31 tax returns in question, which were filed for the 2011 through 2015 tax years, the fraudulently claimed deductions totaled $352,931, according to the indictment.
At her arraignment Wednesday afternoon, McCoy entered a not guilty plea and was ordered to stand trial before United States District Judge Christina A. Snyder on June 5.
If convicted of the charges contained in the indictment, McCoy would face a statutory maximum sentence of three years in federal prison and a fine of $100,000 for each of the 31 counts in the indictment.
This case is the product of an investigation by IRS Criminal Investigation and is being prosecuted by Assistant United States Attorney Valerie Makarewicz of the Tax Division.
Previously Convicted Return Preparer Arrested on Theft and Identity Theft Charges
A former income tax return preparer who was convicted in 2002 of preparing false tax returns was arrested this morning on new charges of fraudulently using the identities and Social Security numbers of two individuals to steal federal income tax refund checks.
Elton Leander Barnes, Jr., 55, previously of Irvine and now of South Los Angeles, allegedly negotiated federal income tax refund checks issued in the names of the identity theft victims.
Barnes was named in a four-count indictment returned last month by a federal grand jury. The indictment specifically charges Barnes with two counts of theft of government property and two counts of aggravated identity theft.
The indictment alleges that Barnes fraudulent converted to his own use two income tax refund checks in the amounts of $3,028 and $7,189.
If convicted of theft of government property, Barnes will face a statutory maximum sentence of 10 years in federal prison for each of the two counts. In addition, each count of aggravated identity theft carries a mandatory, consecutive sentence of two years in federal prison.
Barnes is expected to be arraigned on the indictment this afternoon in United States District Court in Los Angeles.
This case is the product of an investigation by IRS Criminal Investigation. The case is being prosecuted by Assistant United States Attorneys James Hughes and Valerie Makarewicz of the Tax Division.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed to be innocent until proven guilty in court.
Return preparer fraud, identity theft, and inflated refund schemes are three of the Internal Revenue Service’s Dirty Dozen List of Tax Scams for 2018. The IRS has some information on its website about selecting a return preparer and has launched a free directory of federal tax preparers. Also, the IRS has a list of steps on its website that you can take now in anticipation of filing your 2017 federal income tax return and ten tips for choosing a tax preparer.
Father and Son Indicted in Large Scale Vehicle Odometer Roll Back SchemeRead the Press Release
Jackson, Miss. – Mark Longgrear, 53, of Jackson, and son, Zachary Longgrear, 29, of Madison, both waived appearance for their arraignments before U.S. Magistrate Judge F. Keith Ball after having been recently indicted and charged with rolling back the odometers of multiple high mileage vehicles and selling such fraudulently altered vehicles with doctored titles, announced U.S. Attorney Mike Hurst and Deputy Administrator Heidi King with the U.S. Department of Transportation, National Highway Traffic Safety Administration.
The Indictment alleges that, from 2014 through at least February 2018, Mark Longgrear, along with his son, Zachary Longgrear, both individually and under their company Southern Auto Buyers LLC, bought a large number of late model, high mileage vehicles from numerous sources, thereafter illegally altered the odometers of these vehicles to show lower mileage, forged and fraudulently created paperwork to secure new titles showing false lower mileage on these vehicles, and then sold the vehicles directly to individuals and automobile dealerships at much higher prices. Thereafter, some of these rolled-back vehicles were subsequently sold by dealerships to consumers in the Mississippi area and elsewhere.
The Longgrears were charged with one count of conspiracy, which carries a maximum penalty of 5 years in prison and a $250,000.00 fine. In Counts 2-8, the Longgrears were charged with altering odometers of motor vehicles, and in Counts 9-14, the Longgrears were charged with giving or causing to be given false statements relating to odometers, all of which carry maximum penalties of three years per count and a $250,000.00 fine, or twice the gross gain or loss, whichever is greater. Finally, in Counts 15-20, the Longgrears were charged with making, uttering or possessing forged or counterfeit certificates of title for motor vehicles, which carry maximum penalties of 10 years in prison and $250,000.00 fine.
This case is set for trial on May 14, 2018 before the Honorable Carlton W. Reeves. The public is reminded that the indictment is merely an accusation and that the defendants are each presumed innocent unless and until proven guilty.
The case is the result of an investigation by the United States Department of Transportation, National Highway Traffic Safety Administration, Office of Odometer Fraud
Investigation, with assistance from the United States Postal Inspection Service, and the U.S. Marshals Service. It is being prosecuted by Assistant U.S. Attorney Keesha Middleton.
Odometer fraud is the disconnection, resetting, or alteration of a vehicle’s odometer with the intent to change the number of miles indicated. NHTSA estimates that more than 450,000 vehicles are sold each year with false odometer readings.
"Odometer fraud costs American consumers more than $1 billion annually, said NHTSA Deputy Administrator King. "We will continue to work with Department of Justice and state DOT partners to investigate odometer fraud, deter tampering, and inform consumers of the potential signs and dangers associated with this crime."
NHTSA has established a special hotline to handle odometer fraud complaints. Individuals who have information relating to odometer tampering should call (800) 424-9393 or (202) 366-4761. Individuals can also file a complaint online at www.NHTSA.gov/Equpment/Odometer-Fraud.
Erie Woman Charged with Preparing False Tax Returns for Herself and OthersRead the Press Release
ERIE, Pa. – A resident of Erie, Pennsylvania has been indicted by a federal grand jury in Erie on charges of false income tax return and aid or assist false or fraudulent document, United States Attorney Scott W. Brady announced today.
The fourteen-count indictment named Andrea Jones as the sole defendant.
According to the indictment presented to the court, Jones prepared false federal income tax returns for herself and others who used her as their return preparer for calendar years 2011, 2012, 2013, 2014 and 2015.
The law provides for a maximum total sentence of 42 years in prison, a fine of $3,500,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Christian A. Trabold is prosecuting this case on behalf of the government.
The Internal Revenue Service, Criminal Investigation conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
Erie City Council President Indicted on Fraud and Theft Charges Relating to her Non-Profit OrganizationRead the Press Release
ERIE, Pa. – The founder of an Erie non-profit organization and current Erie City Council President has been indicted by a federal grand jury in Erie on charges of wire fraud, theft of government property and false writing or document to the government, United States Attorney Scott W. Brady announced today.
The 33-count indictment, returned yesterday, named Sonya Arrington, 51, of Erie, Pennsylvania, as the sole defendant.
"When public officials and those who seek donations for charitable purposes commit dishonest acts, public confidence suffers," stated U.S. Attorney Brady. "We will root out and prosecute corrupt individuals whenever we find them engaging in fraudulent acts while serving in a public position or using charitable contributions to their nonprofit organizations for private gain."
According to the indictment presented to the court, Arrington diverted funds donated to Mothers Against Teen Violence, a non-profit organization she created to help prevent violence among teenagers, to pay for her gambling and personal expenses. Specifically, the indictment alleges that from December 2011 to March 2018, Arrington engaged in a scheme to defraud MATV of at least $70,000. She allegedly solicited donations from individuals and entities in person and by email; received donations to MATV in cash and checks payable to MATV and deposited a portion of the donations into MATV bank accounts and kept a portion in cash for herself; and did not deposit cash but kept donations for herself. She also allegedly used the debit card for the MATV bank accounts to make purchases unrelated to the organization’s purposes, for things like personal items of clothing, groceries, car washes and food at restaurants; used the debit card for MATV to pay personal bills for T-Mobile, State Farm, First Energy and others; and deposited checks to MATV into personal bank accounts and kept a portion for personal use. The indictment alleges that on 113 occasions from April 2012 to January 2018, Arrington used the MATV debit card to withdraw MATV funds at Presque Isle Downs & Casino. The indictment also alleges that Arrington fraudulently received approximately $29,558 in Social Security disability benefits and submitted a document to the Social Security Administration that contained a false statement.
The law provides for a maximum total sentence of 635 years in prison, a fine of $7,750,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Christian A. Trabold is prosecuting this case on behalf of the government.
The Federal Bureau of Investigation and the Social Security Administration, Office of Inspector General, conducted the investigation leading to the indictment in this case.
An indictment is an accusation. A defendant is presumed innocent unless and until proven guilty.
El Departamento de Justicia Anuncia Una Iniciativa Nacional Para Combatir El Acoso Sexual En La ViviendaRead the Press Release
WASHINGTON, D.C. — Ayer, el día en que el Departamento de Justicia reconoce el 50º aniversario de la ley de Vivienda Justa, el Fiscal General Jeff Sessions anunció el lanzamiento nacional de una iniciativa cuyo objetivo es aumentar el nivel de concientización y denuncia de acoso sexual en la vivienda. Este anuncio incluye un grupo de trabajo interinstitucional entre el Departamento de la Vivienda y Desarrollo Urbano (HUD, por sus siglas en inglés) y el Departamento de Justicia para combatir el acoso sexual en la vivienda, herramientas de promoción comunitaria y una campaña de concientización pública. Este enfoque triple apoyará los esfuerzos del Departamento por combatir el acoso sexual en la vivienda.
«El acoso sexual en la vivienda es ilegal, inmoral e inaceptable», afirmó el Fiscal General Sessions. «Hoy día, estamos viendo con demasiada frecuencia cómo los arrendatarios y administradores de propiedades, así como sus empleados, intentan aprovecharse de mujeres vulnerables. No dudaremos en perseguir a esos depredadores y hacer cumplir la ley. En octubre, mandé formarse una nueva iniciativa para identificar más casos de este estilo y ya hemos conseguido remedios para 15 víctimas. Hoy anunciamos tres pasos nuevos para dar más efectividad a la iniciativa y ganar más casos. Quisiera agradecer a los profesionales dedicados y comprometidos de nuestra División de Derechos Civiles, así como nuestros socios en el Departamento de la Vivienda y Desarrollo Urbano por su excelente trabajo en este empeño. Continuaremos a perseguir de modo agresivo a los acosadores porque todos tienen derecho a sentirse seguros en sus casas».
«Todo tipo de discriminación representa un estigma en el tejido de nuestra nación, pero el HUD está especialmente enfocado en la protección del derecho de todos a sentirse seguros en sus casas y libres de acoso sexual indeseado», declaró el Secretario Ben Carson. «Nadie debe verse obligado a tolerar avances sexuales indeseados para mantener un techo. Como parte de nuestra misión en el HUD, proporcionamos viviendas seguras, y seguiremos adelante con esta misión, siempre diligentes, para proteger a quienes servimos. Anticipo con ganas nuestra colaboración con el Fiscal General Sessions y el Departamento de Justicia como parte de este grupo de trabajo para acabar con este tipo de discriminación».
En octubre del 2017, el Departamento de Justicia anunció una iniciativa para combatir el acoso sexual en la vivienda y lanzó programas piloto en Washington, D.C. y el Distrito Occidental de Virginia. Esta iniciativa buscó fortalecer los esfuerzos del Departamento por proteger a mujeres del acoso a manos de arrendatarios, gestores de propiedad, trabajadores de mantenimiento, guardias de seguridad y otros empleados y representantes de dueños de propiedades de alquiler. Durante los programas piloto, el Departamento desarrolló y probó formas de conectarse mejor tanto con víctimas del acoso sexual en la vivienda como con aquellas organizaciones a las que víctimas suelen dirigirse primero para pedir ayuda, entre ellas la policía, proveedores de servicio legales, autoridades de la vivienda pública, proveedores de servicios para víctimas del asalto sexual y refugios. Asimismo, el Departamento probó ciertos aspectos de la iniciativa en otras jurisdicciones, incluyendo Nueva Jersey, el Distrito Central de California, Massachusetts, Vermont y Michigan.
Los dos programas pilotos llevaron a un incremento en la denuncia ante el Departamento del acoso, tanto de Washington, D.C. como del Distrito Occidental de Virginia. En Washington, el Departamento ha generado seis pistas desde el lanzamiento en octubre del 2017, mientras que en Virginia el Departamento ha generado tres. El Departamento de Justicia reconoce que las pistas e investigaciones no siempre conducen a medidas de aplicación de la ley; no obstante, los resultados del programa piloto, al extrapolarse por todas las oficinas de fiscales federales por todo el país, pueden traducirse en cientos de nuevas denuncias de acoso sexual en la vivienda por todo Estados Unidos.
Debido a estos resultados prometedores, el Departamento está implementando tres componentes fundamentales de la Iniciativa.
En primer lugar, el nuevo Grupo de Trabajo Conjunto del HUD y DOJ para Combatir el Acoso Sexual en la Vivienda implementará una estrategia conjunta entre el Departamento y el HUD para combatir el acoso sexual en la vivienda por todo el país. Se enfocará en cinco áreas clave: el intercambio y análisis de datos continuo; el desarrollo conjunto de mecanismos de capacitación, evaluación de denuncias relacionadas con la vivienda pública; la coordinación de promoción pública y estrategia de prensa; y una revisión de las políticas federales.
En segundo lugar, las herramientas de promoción comunitaria están diseñadas para apalancar la red nacional de Oficinas de Fiscales Federales del Departamento de Justicia. Las herramientas incluyen plantillas, orientación y listas de control basadas en los comentarios recibidos acerca del programa piloto. Al final, multiplicará los recursos de aplicación de la ley disponibles y ayudará a las víctimas del acoso sexual a ponerse en contacto con el Departamento.
Por último, la campaña de concientización pública tiene tres componentes fundamentales: un paquete de colaboración con las partes relevantes, el lanzamiento de una campaña en los medios sociales y anuncios de servicio público (PSA, por sus siglas en inglés), todo dirigido por las Oficinas de los Fiscales Federales. La campaña está específicamente diseñada para concientizar el público y simplificar el proceso para víctimas por todo el país para buscar recursos y denunciar el acoso.
Para más información sobre la División de Derechos Civiles y las leyes de derechos civiles que hace cumplir, vaya a www.usdoj.gov/crt o a www.justice.gov/crt-espanol. Aquellas personas que creen haber sido víctimas del acoso sexual en la vivienda deben llamar al Departamento al 1-844-380-6178, mandar un correo electrónico a [email protected] o comunicarse con el HUD al 1-800-669-9777. Si tiene información o preguntas acerca de cualquier otro tipo de discriminación en la vivienda, puede comunicarse con el Departamento al 1-800-896-7743.
Eight Charged with Conspiring to Traffic Minors for Commercial Sex in New Mexico and ArizonaRead the Press Release
ALBUQUERQUE – U.S. Attorney John C. Anderson, New Mexico Attorney General Hector H. Balderas, Special Agent in Charge Terry Wade of the FBI’s Albuquerque Division, Acting Special Agent in Charge Jack P. Staton of Homeland Security Investigations (HSI) in El Paso, and Bernalillo County Sheriff Manuel Gonzales, III, announced today that eight defendants have been indicted on federal child sex trafficking charges. The defendants are charged with conspiring to sex traffic minors in New Mexico and Arizona, to transport minors to engage in criminal sexual activity, and sex trafficking of minors.
The eight defendants, Chante Bickham, 24, Camara Cherry-Amos, 23, Breeauna Langton, 19, Keron Eugene Lucious, 20, Jason L. Jackson, 23, Devin Perkins, 21, and Andrew Wyatt, 29, all of Albuquerque, and John Dompierre, 54, of Phoenix, Ariz., are charged in an 11-count superseding indictment that was filed on April 10, 2018. The superseding indictment charges the eight defendants with conspiring to recruit and force minors to engage in commercial sex acts, and five of the defendants with transporting a minor in interstate commerce for the purpose of engaging in prostitution. It also charges each defendant with sex trafficking of minors. The superseding indictment alleges that the defendants committed the crimes in Bernalillo County, N.M., and elsewhere between Feb. 2017 and Jan. 2018.
Cherry-Amos, Langton, Lucious and Wyatt, who were arrested yesterday, made their initial appearances in federal court in Albuquerque this morning. They remain in custody pending detention hearings, which are scheduled for tomorrow morning, at which time they also will be arraigned on the superseding indictment.
Bickham is in state custody on related state charges and will be transferred into federal custody to answer to the charges in the superseding indictment. Jackson, who was arrested on a related charge in Nov. 2017, is detained on that related charge; his arraignment hearing is currently scheduled for April 16, 2018. Perkins was arrested in Dec. 2017 on a related charge and is detained; his arraignment hearing has yet to be scheduled.
Dompierre has yet to be arrested and is considered a fugitive.
Superseding Indictment 17-CR-03246-MV
Charges and Statutory Penalties
Count 1 charges the eight defendants with conspiracy to commit sex trafficking of minors from Feb. 2017 through Jan. 2018, in violation of 18 U.S.C. §§ 1594 (a) and (c), and carries a mandatory minimum penalty of 15 years and a maximum penalty of life in prison, and a fine of not more than $250,000.
Count 2 charges Bickham, Cherry-Amos, Dompierre, Jackson and Wyatt with conspiracy to transport minors to engage in criminal sexual activity from Nov. 2017 through Jan. 2018, in violation of 18 U.S.C. §§ 2423 (a) and (c), and carries a mandatory minimum penalty of ten years and a maximum of life in prison, and a fine of not more than $250,000.
Counts 3 through 11 charge each of the defendants with sex trafficking of one of two minors on various dates from Feb. 2017 through Jan. 2018, in violation of 18 U.S.C. §§ 1591 (a) and (b)(2), and carries a mandatory minimum penalty of 15 years and a maximum of life in prison, and a fine of not more than $250,000.
Charges in indictments are merely accusations and defendants are presumed innocent unless found guilty in a court of law.
The investigation of this case was initiated and led by the Bernalillo County Sheriff’s Office and the New Mexico Office of the Attorney General, and thereafter was joined by the Albuquerque offices of the FBI and Homeland Security Investigations. Assistant U.S. Attorney George C. Kraehe is prosecuting the case as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice (DOJ) to combat the growing epidemic of child sexual exploitation and abuse. Led by United States Attorneys’ Offices and DOJ’s Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit http://www.justice.gov/psc/.
Bickham Superseding IndictmentEast Cleveland man indicted for a carjacking in Cleveland Heights and an armed bank robbery in Richmond HeightsRead the Press Release
An East Cleveland man was indicted in federal court for a carjacking in Cleveland Heights and an armed bank robbery in Richmond Heights.
Lashawn Davis, 18, was indicted on two counts of brandishing a firearm during a crime of violence, one count of carjacking and one count of armed bank robbery.
Davis brandished a firearm on Feb. 4 when he took a 2016 Hyundai Elantra from someone on Coventry Road in Cleveland Heights.
He also brandished a firearm on Feb. 17 when he robbed the Dollar Bank on Wilson Mills Road in Richmond Heights, according to the indictment.
Davis posted a photo of himself to Instagram that was taken on Jan. 3 showing himself holding two new Glock pistol boxes. A victim of the bank robbery described the weapon used as having two circles in the area of the muzzle. An employee of the bank heard a robber yell: “you got five seconds or I’m going to (expletive) kill you,” according to court documents.
A bank employee captured the license plate of the getaway vehicle. It was the same license plate as the vehicle that was carjacked in Cleveland Heights 13 days earlier, according to court documents.
Agents searching Davis’ residence at 1835 Penrose Ave. found a revolver and a Glock 27 pistol with an attached red laser sight. Together, the muzzle and the laser sight appeared as circles. A fresh stack of $2 bills were also found in his bedroom. A new stack of $2 bills were taken during the bank robbery, according to court documents.
“If you point a firearm at someone while robbing them, we will work to send you to prison for as long as the law allows,” said U.S. Attorney Justin E. Herdman. “This case is a great example of law enforcement working together to get a dangerous criminal off the streets.”
FBI Special Agent in Charge Stephen D. Anthony said: “The FBI Violent Crime Task Force will continue working with our law enforcement partners to rid our streets of violent criminals like this one. This individual terrorized the driver of the car he carjacked and the folks present in the bank that he robbed. Davis is being held accountable for the illegal actions he chose to engage in.”
“This was good work done by law enforcement – we got a dangerous person off our streets,” said Cuyahoga County Prosecutor Michael C. O’Malley. “This collaboration between CPD, ATF, FBI and my office’s Crime Strategies Unit means the U.S. Attorney’s Office is getting a stronger case for prosecution, sending a loud signal that if you break the law you will be caught and harshly prosecuted.”
The case remains under investigation.
If convicted, the defendant’s sentence will be determined by the Court after reviewing factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense and the characteristics of the violation. In all cases the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
This case was investigated by the Federal Bureau of Investigation, the Cleveland Division of Police, the Cleveland Heights Police Department and the Richmond Heights Police Department, with assistance from the Cuyahoga County Prosecutor’s Crime Strategies Unit. It is being prosecuted by Assistant U.S. Attorneys Scott Zarzycki and Robert J. Patton.
An indictment is only a charge and is not evidence of guilt. Defendants are entitled to a fair trial in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Dubuque Woman Sentenced to over 2 Years in Federal Prison for Possessing Ice Methamphetamine for SaleRead the Press Release
A Dubuque woman who possessed approximately 30 grams of ice methamphetamine and intended to distribute it to others was sentenced April 11, 2018, to 31 months in federal prison.
Ashley Ann Laufenberg, age 28, from Dubuque, Iowa, received the prison term after a November 6, 2017, guilty plea to possession with intent to distribute methamphetamine. In a plea agreement, Laufenberg admitted she possessed about 2 grams of ice methamphetamine with the intent to distribute it while driving a car in Dubuque. At the time, Laufenberg had a warrant for her arrest and law enforcement officers initiated a traffic stop on her car. She unsuccessfully attempted to flee from officers by driving away during the traffic stop. After she was caught, officers found more than $400, a bullet, and a cell phone on her person. Officers at the jail also found 2 grams of methamphetamine on her person. Laufenberg admitted to possessing and selling about 30 grams of ice methamphetamine.
Information at the sentencing hearing showed that Laufenberg’s criminal conduct escalated over time. She was previously convicted of theft and possession of marijuana at ages 17 and 20 and assault while displaying a dangerous weapon at age 27. Laufenberg was selling methamphetamine while on probation for possession of methamphetamine as a third offender, as well as while on probation for assault while displaying a dangerous weapon. Laufenberg previously had a deferred judgment in state court revoked after she tried to stab a man with a knife.
Laufenberg was sentenced in Cedar Rapids by United States District Court Chief Judge Leonard T. Strand. Laufenberg was sentenced to 31 months’ imprisonment. She must also serve a 3-year term of supervised release after the prison term. There is no parole in the federal system.
Laufenberg is being held in the United States Marshal’s custody until she can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Timothy L. Vavricek and investigated by the Dubuque Police Department and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. 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.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 17-CR-1046-LTS.
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Dominican National Pleads Guilty to Drug ConspiracyRead the Press Release
BOSTON – A Dominican national pleaded guilty today in federal court in Boston to his role in a drug trafficking organization that operated in Taunton and Boston.
Yeurys Tejeda, 29, a Dominican national formerly residing in Boston, pleaded guilty to one count of conspiracy to distribute and possess with intent to distribute heroin and fentanyl. In February 2017, Tejeda was arrested and charged along with 22 co-defendants. U.S. District Court Judge Indira Talwani scheduled sentencing for July 10, 2018.
From mid-2016 through February 2017, federal law enforcement investigated two drug trafficking organizations operating in Taunton and Boston, one led by Jose Antonio Lugo-Guerrero, and the other led by Fernando Hernandez. Hernandez’s organization was based in Taunton and sold heroin and fentanyl to customers who re-distributed a portion of the drugs they obtained. It is alleged that Hernandez obtained drugs from a network of suppliers that included Lugo-Guerrero.
According to court documents, Lugo-Guerrero operated a drug trafficking organization in Fall River and Boston that allegedly obtained a significant quantity of illegal drugs by robbing other drug traffickers. Lugo-Guerrero was assisted by co-defendants Wilmi Hernandez-Diaz, Jancer Soto, Juan Morales-Ortiz, Isis Y. Lugo-Guerrero, Jose Negron, Glendalee Rodriguez, Jose Camacho, and Tejeda. Tejeda helped Lugo-Guerrero plan and attempt to rob another drug dealer, and Lugo-Guerrero offered to supply Tejeda with drugs, including cocaine.
Hernandez pleaded guilty and was sentenced in February 2018 to 188 months in prison. Hernandez-Diaz and Morales-Ortiz pleaded guilty and were each sentenced in January 2018 to 30 months in prison. Soto also pleaded guilty and was sentenced in March to five years of probation. Camacho and Rodriguez pleaded guilty in March 2018 and are scheduled to be sentenced, respectively, on June 15 and June 12, 2018. Jose Antonio Lugo-Guerrero, Isis Y Lugo-Guerrero, and Negron have pleaded not guilty.
The conspiracy charge provides for a sentence of no greater than 20 years in prison, a minimum of three years and up to a lifetime of supervised release and a fine of $1 million. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling; Michael Ferguson, Special Agent in Charge of the Drug Enforcement Administration, Boston Field Division; Colonel Kerry A. Gilpin, Superintendent of the Massachusetts State Police; Fall River Police Chief Daniel S. Racine; New Bedford Police Chief Joseph C. Cordeiro; Taunton Police Chief Edward James Walsh; Boston Police Commissioner William B. Evans; and Bristol Country District Attorney Thomas M. Quinn made the announcement today. Assistant U.S. Attorney Ted Heinrich of Lelling’s Narcotics and Money Laundering Unit is prosecuting the case.
The details contained in the charging documents are allegations. The remaining defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Dominican National Charged with Illegal Reentry After DeportationRead the Press Release
BOSTON - A Dominican national was charged today in federal court in Boston with illegally reentering the United States after being deported.
Yerinaldo Arias Guzman, 31, was indicted on one count of illegal reentry of a deported alien.
According to court documents, Guzman was previously deported on June 20, 2017. Law enforcement officers discovered Guzman on March 16, 2018, and determined him to be illegally present in the United States.
Guzman faces a sentence of no greater than 20 years in prison, three years of supervised release, a fine of $250,000, and will be subject to deportation upon completion of his sentence. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling and Michael Shea, Acting Special Agent in Charge of Homeland Security Investigations in Boston, made the announcement today. Assistant U.S. Attorney Suzanne Sullivan Jacobus of Lelling’s Major Crimes Unit is prosecuting the case.
The details contained in the charging documents are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Dominican National Charged with Illegal Reentry After DeportationRead the Press Release
BOSTON - A Dominican national was charged today in federal court in Boston with illegally reentering the United States after being deported.
Maximo Diaz-Tejada, 44, was indicted on one count of illegal reentry of a deported alien.
According to court documents, Diaz-Tejada was previously deported on Oct.1, 2013. Law enforcement officers discovered Diaz-Tejada on Dec. 14, 2017, and determined him to be illegally present in the United States.
Diaz-Tejada faces a sentence of no greater than 20 years in prison, three years of supervised release, a fine of $250,000, and will be subject to deportation upon completion of his sentence. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling and Michael Shea, Acting Special Agent in Charge of Homeland Security Investigations in Boston, made the announcement today. Assistant U.S. Attorney Suzanne Sullivan Jacobus of Lelling’s Major Crimes Unit is prosecuting the case.
The details contained in the charging documents are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Dominican National Arrested for Aggravated Identity TheftRead the Press Release
BOSTON – A Dominican national was arrested today in Miami Beach, Fla., for misusing a Social Security number and aggravated identity theft.
Adys Sanchez, 46, was charged in federal court in Boston on April 5, 2018, with one count of misuse of a Social Security number and one count of aggravated identity theft. Sanchez appeared in federal court in Miami today at 2pm.
According to the indictment unsealed today, in April 2014, Sanchez represented that a Social Security number belonging to another person was her own in an application for a driver’s license renewal at the Massachusetts Registry of Motor Vehicles. The indictment further alleges that Sanchez committed aggravated identity theft by using the Social Security number of another person.
False representation 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 or loss, whichever is greater. The charge of aggravated identity theft carries a mandatory two-year sentence that must run consecutively to any other sentence, one year of supervised release, and a fine of $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew E. Lelling; Michael Shea, Acting Special Agent in Charge of Homeland Security Investigations in Boston; William B. Gannon, Special Agent in Charge of the U.S. Department of State, Bureau of Diplomatic Security, Boston Field Office; Scott Antolik, Special Agent in Charge of the Social Security Administration Office of Inspector General; and Colonel Kerry A. Gilpin, Superintendent of the Massachusetts State Police, made the announcement today. Special Assistant U.S. Attorney Karen Burzycki of Lelling’s Major Crimes Unit is prosecuting the case.
The details contained in the indictment are allegations. The defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Doctor Del Área De El Paso Denunciado De Cargos Federales De DrogasRead the Press Release
El Abogado de los Estados Unidos John F. Bash junto con Steve A. Borak, Interino Agente Especial en Cargo de la Administración para el Control de Drogas (DEA por sus siglas en inglés) de la División de El Paso anunciaron un doctor loacalizado en El Paso fue denunciado de cargos federales de traficante de drogas.
La semana pasada, el gran jurado de acusación regresó con la denuncia de 12 cargos contra el Dr. Thomas Glenn Easter, II y su codemandada Elizabeth Lightfoot, también de El Paso, con dos cargos de conspiración de distribución de Xanax y otras substancias controladas fuera de la capacidad de la práctica profesional. El Dr. Easter fue denunciado con 10 cargos adicionales de distribución de Xanax y otras substancias controladas fuera de la capacidad de la práctica profesional. Autoridades alegan que el Dr. Easter, con asistencia de la Sra. Lightfoot, fue responsable de dispensar prescripciones numerosas de varias medicamentos en cambio de favores.
“El abuso de prescripciones se ha aumentado agresivamente en la comunidad,” dijo el Abogado de los Estados Unidos John F. Bash. “Vamos a tomar medias enérgicas sobre los médicos licenciados que violan la ley – y sus obligaciones profesionales – en dispensar substancias controladas ilegalmente.”
Si se condenan, cada demandado/a puede recibir a lo máximo cinco años en la prisión federal. Los dos demandados están libre bajo una fianza.
“Dr. Thomas Glenn Easter, II, y su codemandada Elizabeth Lightfoot contribuyeron al epidémico de la distribución de substancias controladas que plaga nuestra sociedad,” dijo el Interino Agente Especial en Cargo Steve Borak. “Su comportamiento puso vidas al riesgo y no será tolerada. La DEA, junto con nuestros socios, continuaremos de seguir los que buscan perpetuar y lucrarse de la diversión de las drogas recetadas.”
La División de Diversión Táctico de la Administración para el Control de Drogas en El Paso, junto con el Departamento de Seguridad Pública de Tejas, conducieron ésta investigación. Michael Rose Whyte es el abogado fiscal de parte del gobierno.
Una denuncia simplemente es un cargo y no debería ser considerada como evidencia de culpabilidad. Los demandados son inocentes hasta comprobados culpables antes un tribunal.
Diagnostic Company Owner Sentenced for Kickbacks, Health Care Fraud and Money LaunderingRead the Press Release
HOUSTON – The owner of multiple diagnostic businesses and a durable medical equipment company has been ordered to federal prison in relation to the Team Work Ready (TMR) health care fraud conspiracy, announced U.S. Attorney Ryan K. Patrick. Mark Edward Farias, 48, of Houston pleaded guilty April 17, 2017, admitting to a conspiracy to pay kickbacks, health care fraud as well as money laundering.
Today, U.S. District Judge Gray Miller handed Farias a 68-month sentence to be immediately followed by three years of supervised release. At the hearing, Judge Miller denied Farias’ request for probation and considered the duration of his criminal activity, the repetitive nature of the crime and the $4,122,980 his companies billed. The court also ordered Farias to pay $2,790,704 in restitution to the Department of Labor Office of Worker’s Compensation who administers the Federal Employees Compensation Act (FECA) health insurance program.
Farias was the owner of a durable medical equipment business known as AMR Medical Supply as well as three medical diagnostic businesses - Winlock Medical Surgical LLC, ARC Diagnostics LLC and Tessla Diagnostics LLC - located in Texas and Louisiana. As part of his guilty plea, Farias admitted he paid the owner and CEO of TWR – Jeffrey Eugene Rose, 55, of Houston - at least $436,213.54 in kickbacks for access to at least 419 patients from TWR clinics in Texas and Louisiana. Farias admitted he attempted to hide and conceal the kickback payments by indicating on the payments that they were for marketing. Farias did not receive any marketing services from TWR, just patients covered by the FECA program. In addition to engaging in kickbacks, Farias admitted he also committed health care fraud by submitting up-coded claims for the kickback patients, including claims for diagnostic testing that were not medically necessary, and for diagnostic reports that were not produced. Farias also admitted to engaging in money laundering with the criminal proceeds he received from FECA.
Rose was convicted of conspiracy, health care fraud, wire fraud and money laundering in October 2016 following a three-week trial. Also convicted were chief financial officer Pamela Annette Rose, 55, of Houston, along with the clinic’s vice president of operations Frankie Lee Sanders, 55, also of Houston. Team Work Ready defendants Pamela Rose and Sanders were sentenced in July of last year to 120 and 300 months, respectively. Jeffrey Rose is scheduled for sentencing on June 1, 2018, before U.S. District Judge Ewing Werlein Jr.
Farias was permitted to remain on bond and voluntarily surrender to a U.S. Bureau of Prisons facility to be determined in the near future.
U.S. Postal Service - Office of Inspector General (OIG), Department of Labor – OIG, IRS - Criminal Investigation, Department of Veterans Affairs - OIG and Department of Homeland Security – OIG conducted the joint investigation. Assistant U.S. Attorney Julie Redlinger is prosecuting the case.
Detroit Man Pleads Guilty to Drug ChargeRead the Press Release
BECKLEY, W.Va. – United States Attorney Mike Stuart announced today that a Detroit man pled guilty to a federal drug charge. William James Springer, 31, of the Detroit area, pled guilty to distribution of a quantity of oxymorphone. Springer admitted that on October 5, 2016, he distributed three oxymorphone pills to a confidential informant. He further admitted that between September 2016 and December 2016 he was involved in distributing about 300 40 mg oxymorphone pills in Greenbrier County, including pills which he distributed as charged in the other counts of the indictment. Springer faces up to 20 years in prison when he is sentenced on July 18, 2018. Stuart praised the work of the Greenbrier Valley Drug and Violent Crime Task Force.
“We should send Detroit a bill. They send us their drug dealers and we lock them up,” said United States Attorney Mike Stuart. “They have wreaked havoc in West Virginia for far too long. Detroit drug dealers are not welcome here.”
United States District Court Judge Irene C. Berger presided over the plea hearing. Assistant United States Attorney John File is handling the prosecution.
The case was investigated as part of the Greenbrier Valley Heroin and Pill Initiative, an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the sale of heroin and the illicit sale and misuse of prescription drugs. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down illegal pill trafficking, eliminating open air drug markets, and curtailing the spread of opiate painkillers in communities across the Southern District.
Follow us on Twitter: @SDWVNews and @USAttyStuart
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Department of Justice Begins Second Distribution of Funds Recovered Through Asset Forfeiture Totaling $1.2 Billion to Compensate Victims of Bernard Madoff Fraud SchemeRead the Press Release
The Department of Justice today announced that on April 12, the Madoff Victim Fund (MVF) began its second distribution of $504 million in funds forfeited to the U.S. Government in connection with the Bernard L. Madoff Investment Securities LLC (BLMIS) fraud scheme, bringing the total distributed to over $1.2 billion. These funds will be sent to over 21,000 victims across the globe. This distribution represents the second in a series of payments that will eventually return over $4 billion to victims as compensation for losses they suffered from the collapse of the BLMIS. The MVF has received over 65,000 petitions from victims in 136 countries.
Attorney General Jeff Sessions, Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division and U.S. Attorney Geoffrey S. Berman for the Southern District of New York made the announcement.
“In one of the most notorious and unconscionable financial crimes in history, Bernie Madoff robbed tens of thousands of individuals, pension plans, charitable organizations and others, all the while funding a lavish personal lifestyle,” said Attorney General Sessions. “Through the use of asset forfeiture, the Department of Justice has recovered over $4 billion of Mr. Madoff’s fraud, and we continue to work to compensate those he defrauded. Last June, the Department approved more than 39,000 petitions for compensation. Today, during National Crime Victims’ Rights Week, the Department returns more than a half-billion dollars to nearly 22,000 law-abiding people and organizations. We cannot undo the damage that Bernie Madoff has done, but today’s distribution will provide significant relief to many of the victims of one of the worst frauds of all time.”
“Bernie Madoff committed history’s largest Ponzi scheme,” said U.S. Attorney Berman. “This Office prosecuted Madoff himself, and others who helped perpetrate his fraud, and continues to vigorously pursue money recoveries for his victims. Today’s payment of more than $500 million is this Office’s second installment in a series of distributions that represent our ongoing commitment to find relief for victims of Madoff’s heinous crimes.”
For decades, Bernard L. Madoff used his position as Chairman of BLMIS, the investment advisory business he founded in 1960, to steal billions from his clients. On March 12, 2009, Madoff pleaded guilty to 11 federal felonies, admitting that he had turned his wealth management business into the world’s largest Ponzi scheme, benefitting himself, his family and select members of his inner circle. On June 29, 2009, U.S. District Judge Denny Chin sentenced Madoff to 150 years in prison for running the largest fraudulent scheme in history. Judge Chin ordered Madoff to forfeit $170.799 billion as part of Madoff’s sentence.
Of the approximately $4.05 billion that will be made available to victims, approximately $2.2 billion was collected as part of the historic civil forfeiture recovery from the estate of deceased Madoff investor Jeffry Picower. An additional $1.7 billion was collected as part of a Deferred Prosecution Agreement with JPMorgan Chase Bank N.A. and civilly forfeited in a parallel action. The remaining funds were collected through a civil forfeiture action against investor Carl Shapiro and his family, and from civil and criminal forfeiture actions against Bernard L. Madoff, Peter B. Madoff and their co-conspirators.
The MVF’s payouts would not have been possible without the extraordinary efforts of the U.S. Department of Justice Criminal Division’s Money Laundering and Asset Recovery Section, the U.S. Attorney’s Office for the Southern District of New York, and the FBI in the prosecution of these crimes and the recovery of assets supporting the forfeiture in this case. The MVF is overseen by Richard Breeden, former Chairman of the U.S. Securities and Exchange Commission, in his capacity as Special Master appointed by the Department of Justice to assist in connection with the victim remission proceedings.
More information about MVF and its compensation to victims of BLMIS is available on the MVF website at www.madoffvictimfund.com, such as eligibility criteria, process updates, and frequently asked questions. Further questions may be directed to the MVF at 866-624-3670 or [email protected]
Crime Victims, Survivors, Good Samaritans and Community Members Honored at Event Marking National Crime Victims’ Rights WeekRead the Press Release
WASHINGTON - U.S. Attorney Jessie K. Liu and the Victim Witness Assistance Unit of the U.S. Attorney’s Office for the District of Columbia paid tribute today to crime victims, their families, witnesses, community members, criminal justice partners, and Good Samaritans for their bravery, compassion, and dedication to the pursuit of justice.
More than two dozen honorees were recognized during an event at the Ceremonial Courtroom of the District of Columbia Court of Appeals. The ceremony was timed with the annual observance of National Crime Victims’ Rights Week. This year’s national theme, “Expand the Circle: Reach All Victims,” emphasizes the importance of inclusion in victim services and addresses the need to ensure that every crime victim has access to services and support, and for professionals, organizations, and communities to work in tandem.
“We draw inspiration every day from the bravery, resilience and strength shown by victims, witnesses, and the many people in our community who stand up for justice,” said U.S. Attorney Liu. “The people being honored today remind us of the importance of thinking creatively and collaboratively to reach all those victims who need help.”
The featured speaker was Fainess Lipenga, a survivor of labor trafficking who now shares her experience to educate the community and raise awareness. Ms. Lipenga told of working 16 and 17-hour work days, seven days a week, as a domestic employee. She was able to flee from the ordeal and now is a consultant for the Human Trafficking Legal Center, training lawyers and other professionals nationwide. She also has been a member of the National Survivor Network, a program of the Coalition to Abolish Slavery and Trafficking (CAST). She spoke of the kindness of people who helped her start a new life.
In addition to Ms. Lipenga, the U.S. Attorney’s Office honored other individual victims, survivors, Good Samaritans, and partners whose efforts furthered the cause of justice.
For example, the honorees included a teenager who showed great strength and tenacity in testifying against a twice-convicted sex offender who sexually abused her in 2016 at the Potomac Avenue Metro Station; a woman who urged the Metropolitan Police Department to take another look at the 1999 murder of her father, leading to the solving of the case, and a Good Samaritan who aided a woman who was being sexually assaulted in 2017 in the back of a taxicab. The Good Samaritan, a motorist, saw the woman in the passenger seat of the cab in the 4900 block of 16th Street NW, waving for help and fighting the taxi driver. He made a U-turn and pulled in front of the taxi, forcing it to stop. The woman was able to escape. The Good Samaritan called police, waited for them to arrive and the taxi driver was caught and later convicted of his crimes.
The honorees also included a neighbor who did all that he could to aid a dying homicide victim who showed up at his doorstep in Southeast Washington. The victim, Darlene Bryant, was stabbed in the neck on May 13, 2015, inside the stairwell of a building on Wheeler Road SE. Ms. Bryant, 46, made her way down the stairs, stumbled to the street, and banged on the neighbor’s door. The neighbor tried to comfort her and cover the wound, in addition to calling 911 and diligently following instructions of the 911 operator. Despite these heroic efforts, Ms. Bryant died on his front steps. The neighbor did not see who killed Ms. Bryant, but described her final moments at the trial of the man later convicted of the murder.
The U.S. Attorney’s Office also recognized the extraordinary efforts of partners who provided support to victims’ families during the three-week trial last year that ended with the convictions of two Mexican nationals for the killing of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI) Special Agent Jaime Zapata and the attempted murder of ICE HSI Special Agent Victor Avila on Feb. 15, 2011, in Mexico. More than 20 members of the Special Agents’ families attended the trial and were greeted and aided daily by the U.S. Marshals Service and the Court Security Officers at the U.S. District Court for the District of Columbia. Additionally, the Capital Area Law Enforcement Foundation (CALE) assisted the family members, including hosting a dinner for them and arranging a meeting with Peter Newsham, Chief of the Metropolitan Police Department (MPD) during their time in Washington. Finally, Aaron Adaway, Administrative Assistant to Chief Judge Beryl A. Howell, was honored for the special care he showed during the trial.
Today’s event was developed and organized by the Victim Witness Assistance Unit of the U.S. Attorney’s Office. Members of the Unit provide essential services and support to victims and witnesses, such as making referrals for counseling and other services, addressing safety concerns, arranging travel, and accompanying victims to court proceedings. The Unit also notifies victims of their rights and provides information regarding significant case events, such as the filing of charges, plea hearings, trials and sentencing hearings.
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Additional information about the Victim Witness Assistance Unit is available at https://www.justice.gov/usao-dc/victim-witness-assistance
Further information about National Crime Victims’ Rights Week is available at http://ovc.ncjrs.gov/ncvrw/
Each year in April, the Department of Justice and United States Attorney’s Offices nationwide observe National Crime Victims’ Rights Week by honoring victims of crime and those who advocate on their behalf. The Justice Department will host the Office for Victims of Crime’s annual National Crime Victims’ Service Awards Ceremony in Washington, D.C. on April 13, 2018, to honor outstanding individuals and programs that serve victims of crime.
“In law enforcement, we are sworn to serve and protect,” said Attorney General Jeff Sessions. “We carry out this oath every day by protecting the rights of law abiding people from criminals and by achieving justice for crime victims. This week, we remember the millions of Americans who have been victimized by criminals and we thank those who have gone above and beyond the call of duty in their service to those victims. As we do so, we recommit ourselves to fulfilling our oath and to reducing crime in America."
Convicted Felon Pleads Guilty to Unlawfully Possessing a FirearmRead the Press Release
Jackson, Miss. – Darryl Jones, 36, of Jackson, pled guilty today, before Chief U.S. District Judge Daniel P. Jordan III, to being a felon in possession of a firearm, announced U.S. Attorney Mike Hurst and Special Agent in Charge Dana Nichols of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF). Jones has an extensive criminal history, which includes convictions for several drug-related felony offenses.
Jones will be sentenced in Jackson by Chief Judge Daniel P. Jordan III on July 17, 2018, and faces a maximum penalty of 10 years in prison, followed by up to 3 years of supervised release, and a $250,000 fine.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Jackson Police Department. It is being prosecuted by the United States Attorney’s Office in Jackson.
Cleveland man indicted for selling fentanyl and other drugsRead the Press Release
A Cleveland man was indicted for selling fentanyl and other drugs.
Hamilton Greathouse, 36, was indicted on two counts of possession with intent to distribute controlled substances. Greathouse had 52 grams of fentanyl and 154 grams of N-Ethylpentylone on Dec. 15, 2017, according to the indictment.
Assistant U.S. Attorney Margaret Sweeney is prosecuting the case following in investigation by the Northern Ohio Law Enforcement Task Force and U.S. Pretrial Services
If convicted, the Court will determine the defendant’s sentence after a review of factors unique to this case, including the defendant’s prior criminal record, if any, the defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum. In most cases, it will be less than the maximum.
An indictment is a charge and is not evidence of guilt. A defendant is entitled to a fair trial in which it will be the government's burden to prove guilt beyond a reasonable doubt.
Cleveland man indicted for having a firearm after numerous violent felony convictionsRead the Press Release
A Cleveland man was indicted on federal firearms charges, said U.S. Attorney Justin E. Herdman.
Demetrius Hansbro, 39, was indicted on one count of being a felon in possession of a firearm. Hansbro possessed a Glock 19, Model GEN 4, 9mm caliber pistol and ammunition, despite numerous prior felony convictions that made it illegal for him to have a firearm, including robbery, assault, aggravated assault, domestic violence, child endangering and drug offenses, according to the indictment.
Assistant U.S. Attorney Kathryn G. Andrachik is prosecuting the case following an investigation by the Euclid Police Department and the Bureau of Alcohol, Tobacco, Firearms and Explosives.
If convicted, the defendant’s sentence will be determined by the court after review of factors unique to this case, including the defendant’s prior criminal record, if any, the Defendant’s role in the offense, and the characteristics of the violation. In all cases, the sentence will not exceed the statutory maximum and in most cases it will be less than the maximum.
An indictment is only a charge and is not evidence of guilt. A defendant is entitled to a fair trial, in which it will be the government’s burden to prove guilt beyond a reasonable doubt.
Chinese Citizen Pleads Guilty to Mail Fraud Related to Dietary Supplement SchemeRead the Press Release
DALLAS – Zhang Xiao Dong (a.k.a. Mark Zhang), of Shanghai, China, pleaded guilty today in Dallas to committing mail fraud in connection with a scheme to sell mislabeled dietary supplements, announced U.S. Attorney Erin Nealy Cox of the Northern District of Texas.
Zhang was the sales manager for Genabolix USA Inc. and Shanghai Yongyi Biotechnology Co. Ltd., Chinese firms that sell raw ingredients for use in dietary supplements. In pleading guilty, Zhang admitted that he agreed to help sell synthetic stimulant ingredients, including the substance known as 1,4-DMAA, to a purported dietary supplement manufacturer in the United States. According to an indictment returned in October 2017, Zhang and two co-defendants agreed with a confidential government informant to either mislabel the synthetic ingredients or otherwise help to hide the true nature of a proposed dietary supplement from retailers. Zhang admitted that he knew major American dietary supplement retailers would refuse to carry supplements known to contain certain stimulants, such as DMAA.
“Americans should be able to trust the products they consume are safe,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “We will continue to investigate and prosecute those who enable the sale of mislabeled and potentially unsafe dietary supplements.”
Zhang pleaded guilty before U.S. Magistrate Judge David Horan of the Northern District of Texas. He faces a statutory maximum sentence of 20 years of imprisonment. The Court set sentencing for Oct. 15.
“U.S. consumers trust that their dietary supplements are safe and contain appropriate labeling. When unscrupulous producers add undeclared or misidentified ingredients to dietary supplements, there is no assurance that the product is safe for consumption,” said Catherine A. Hermsen, Acting Director, FDA Office of Criminal Investigations. “The FDA will continue to pursue and bring to justice those who participate in fraudulently marketing dietary supplements to the detriment of public health.”
Zhang was arrested in September 2017 along with a co-defendant, Gao Mei Fang, while attending a dietary supplement trade show in Las Vegas. Gao pleaded guilty on April 3, 2018. A third defendant named in the case, Hu Chang Chun, is not believed to be in the United States.
The case was investigated by FDA’s Office of Criminal Investigations. The case was prosecuted by Kate Rumsey, Assistant United States Attorney for the Northern District of Texas; and David Sullivan and Patrick R. Runkle, Trial Attorneys in the Department of Justice’s Consumer Protection Branch.
Additional information about the Consumer Protection Branch and its enforcement efforts may be found at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the Northern District of Texas, visit its website at https://www.justice.gov/usao-ndtx.
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Chinese Citizen Pleads Guilty to Mail Fraud Related to Dietary Supplement SchemeRead the Press Release
Zhang Xiao Dong (a.k.a. Mark Zhang), of Shanghai, China, pleaded guilty in Dallas to committing mail fraud in connection with a scheme to sell mislabeled dietary supplements, the Department of Justice announced today.
Zhang was the sales manager for Genabolix USA Inc. and Shanghai Yongyi Biotechnology Co. Ltd., Chinese firms that sell raw ingredients for use in dietary supplements. In pleading guilty, Zhang admitted that he agreed to help sell synthetic stimulant ingredients, including the substance known as 1,4-DMAA, to a purported dietary supplement manufacturer in the United States. According to an indictment returned in October 2017, Zhang and two co-defendants agreed with a confidential government informant to either mislabel the synthetic ingredients or otherwise help to hide the true nature of a proposed dietary supplement from retailers. Zhang admitted that he knew major American dietary supplement retailers would refuse to carry supplements known to contain certain stimulants, such as DMAA.
“Americans should be able to trust the products they consume are safe,” said Acting Assistant Attorney General Chad A. Readler of the Justice Department’s Civil Division. “We will continue to investigate and prosecute those who enable the sale of mislabeled and potentially unsafe dietary supplements.”
Zhang pleaded guilty before U.S. Magistrate Judge David Horan of the Northern District of Texas. He faces a statutory maximum sentence of 20 years of imprisonment. The Court set sentencing for Oct. 15.
“U.S. consumers trust that their dietary supplements are safe and contain appropriate labeling. When unscrupulous producers add undeclared or misidentified ingredients to dietary supplements, there is no assurance that the product is safe for consumption,” said Catherine A. Hermsen, Acting Director, FDA Office of Criminal Investigations. “The FDA will continue to pursue and bring to justice those who participate in fraudulently marketing dietary supplements to the detriment of public health.”
Zhang was arrested in September 2017 along with a co-defendant, Gao Mei Fang, while attending a dietary supplement trade show in Las Vegas. Gao pleaded guilty on April 3, 2018. A third defendant named in the case, Hu Chang Chun, is not believed to be in the United States.
The case was investigated by FDA’s Office of Criminal Investigations. The case was prosecuted by Kate Rumsey, Assistant United States Attorney for the Northern District of Texas; and David Sullivan and Patrick R. Runkle, Trial Attorneys in the Department of Justice’s Consumer Protection Branch.
Additional information about the Consumer Protection Branch and its enforcement efforts may be found at http://www.justice.gov/civil/consumer-protection-branch. For more information about the U.S. Attorney’s Office for the Northern District of Texas, visit its website at https://www.justice.gov/usao-ndtx.
Charter Captain Arrested and Charged Federally with Misconduct or Neglect that Resulted in DeathRead the Press Release
Yesterday, Mauricio Alvarez, 49, of Miami, Florida, was ordered to be detained by United States Magistrate Judge Jonathan Goodman on a criminal complaint charging him with misconduct or neglect of a ship officer that resulted in the death of an individual, in violation of Title 18, United States Code, Section 1115.
Benjamin G. Greenberg, United States Attorney of the Southern District of Florida, Thomas Robarge, Special Agent in Charge, United States Coast Guard Investigative Service (CGIS), Southeast Region, and Major Alfredo Escanio, Regional Commander, Florida Fish and Wildlife Conservation Commission (FWC), Division of Law Enforcement, South B Region, made the announcement.
According to the criminal complaint, on April 1, 2018, the United States Coast Guard (USCG) received a report from a Miami-Dade 911 operator that a person was trapped under the motor yacht (M/Y) MIAMI VICE, near Monument Island. USCG and local law enforcement units arrived at the scene of the reported incident and located M/Y MIAMI VICE adjacent to Monument Island. An investigation by FWC revealed M/Y MIAMI VICE was chartered for a four-hour period on April 1, 2018 and departed a marina with approximately seven passengers. The complaint alleges that Alvarez was employed as the vessel captain of M/Y MIAMI VICE and that he had a first mate on board the vessel. M/Y MIAMI VICE had been chartered for a four-hour trip for $3,000 and Alvarez was to be paid $150 per hour.
According to the complaint, two passengers were reportedly in the water in close proximity to the stern of M/Y MIAMI VICE when Alvarez engaged the engines of M/Y MIAMI VICE in reverse. Preliminary information indicates that one of the individuals, who was swimming in the water, was struck by M/Y MIAMI VICE’s propellers and killed. The complaint alleges that Alvarez, as the operator of the M/Y MIAMI VICE, could not see the stern of the vessel or ensure the safety of any remaining swimmers in the water while engaging the engines from this location without assistance from another individual. The complaint further alleges that Alvarez did not have a United States Captain license at the time of the incident.
Alvarez was arrested on April 6, 2018 at Fort Lauderdale-Hollywood International Airport, as he attempted to board an overseas flight. The next hearing is scheduled for April 20, 2018.
The charge of misconduct or neglect of a ship officer carries a maximum potential sentence of ten years’ imprisonment.
Mr. Greenberg commended the investigative efforts of CGIS and FWC in this matter. This case is being prosecuted by Special Assistant U.S. Attorney Emily A. Rose.
A criminal complaint is merely an allegation and every defendant is presumed innocent unless and until proven guilty in a court of law.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Charleston Felon Sentenced to Six Years in Federal Prison for Drug DistributionRead the Press Release
CHARLESTON, W.Va. – A Charleston felon, who sold heroin, fentanyl, and methamphetamine was sentenced to six years in federal prison, announced United States Attorney Mike Stuart. Christopher Rush, 32, previously pled guilty to distribution of heroin. Stuart commended the investigation conducted by the Metropolitan Drug Enforcement Network Team (MDENT).
“A repeat drug dealer and, now a repeat convicted felon. Getting him and others like him off the streets is a priority for me,” said United States Attorney Mike Stuart. “Sending him to prison is a win for law enforcement and the general public.”
Rush previously admitted that on May 10, 2017, he sold heroin to a confidential informant working with MDENT. The drug deal took place in Charleston, West Virginia. He also admitted that he sold heroin, fentanyl, and methamphetamine to this same confidential informant on three other occasions. Based on the four controlled drug buys, officers with MDENT obtained a search warrant for Rush’s residence. On May 31, 2017, officers executed that search warrant and found in excess of 100 grams of crystal methamphetamine that had a purity of 99 percent. Rush admitted to law enforcement officers that the methamphetamine belonged to him.
Assistant United States Attorneys C. Haley Bunn and Timothy D. Boggess handled the prosecution. The sentence was imposed by United States District Judge John T. Copenhaver, Jr.
This case is being prosecuted as part of an ongoing effort led by the United States Attorney’s Office for the Southern District of West Virginia to combat the illicit sale and misuse of illegal drugs, including methamphetamine. The U.S. Attorney’s Office, joined by federal, state and local law enforcement agencies, is committed to aggressively pursuing and shutting down pill trafficking, eliminating open air drug markets, and curtailing the spread of illegal drugs in communities across the Southern District.
Follow us on Twitter: @SDWVNews and @USAttyStuart
###Burlington County, New Jersey, Pharmacist Sentenced to 15 Years in Prison for Illegally Distributing Opioids from ‘Pill Mills’Read the Press Release
CAMDEN, N.J. – A Medford, New Jersey, pharmacist was sentenced today to 180 months in prison for illegally distributing and dispensing oxycodone from two pharmacies located in Medford, U.S. Attorney Craig Carpenito announced.
Michael Ludwikowski, 46, the owner of Olde Medford Pharmacy and Medford Family Pharmacy, was previously convicted of six counts in an indictment charging him with illegally distributing and dispensing oxycodone, a Schedule II controlled substance, and maintaining a drug-involved premises. He was convicted following a five-week trial before U.S. District Judge Jerome B. Simandle, who imposed the sentence today in Camden federal court.
According to documents filed in this case and statements made in court:
From March 2008 through August 2013, Ludwikowski, the pharmacist-in-charge of Olde Medford Pharmacy, and his employee, David M. Goldfield, 60, of Medford Lakes, New Jersey, knowingly distributed and dispensed oxycodone and other controlled substances to individuals, including addicts, who presented phony prescriptions.Ludwikowski ordered large quantities of oxycodone from a national distributor. The distributor established thresholds for the quantity of controlled substances that it supplied to certain pharmacies. Ludwikowski and his pharmacies received large quantities of 30mg oxycodone pills, even though he knew the painkiller was not going to be used for legitimate medical reasons.
In some instances, the customers presented fraudulent prescriptions for a non-narcotic substance that had been “washed,” or “bleached,” through a chemical process that removed the original writing. The customers then rewrote the prescriptions for their drug of choice, oxycodone. Ludwikowski and Goldfield also ignored concerns raised by an employee who pointed out an obviously altered prescription.
Customers who used the fraudulent prescriptions generally paid in cash and provided gifts to Ludwikowski and Goldfield. In some instances, these customers filled fraudulent prescriptions for oxycodone multiple times a week.
In furtherance of the scheme, Ludwikowski and another pharmacist he employed – referred to in the indictment as “Pharmacist 3” – reached an agreement with a physician –referred to in the indictment as “Doctor 1” – to “steer” Doctor 1’s patients to Ludwikowski’s pharmacies. In a text message from Pharmacist 3 to Ludwikowski on Jan. 11, 2013, Pharmacist 3 wrote: “I talked to [Doctor 1] and he is going to direct all of his patients to us he is the pain doc in Cherry Hill.”
In addition to the prison term, Judge Simandle sentenced Ludwikowski to five years of supervised released, 1,000 hours of community service and ordered him to pay a fine of $12,000.
U.S. Attorney Carpenito credited special agents of the FBI’s Newark Field Office, under the direction of Acting Special Agent in Charge Bradley W. Cohen; the Drug Enforcement Administration’s Newark Division, under the direction of Special Agent in Charge Valerie A. Nickerson; the Medford Police Department under the direction of Chief Richard J. Meder; the Moorestown Police Department under the direction of Chief Lee R. Lieber; the Florence Police Department under the direction of Chief John Bunce; and the Lumberton Police Department under the direction of Chief Tony Diloreto, with the investigation leading to today’s sentencing.
The government is represented Senior Litigation Counsel Jason M. Richardson of the U.S. Attorney’s Office in Camden, as well as Assistant U.S. Attorney Sarah Devlin of the Office’s Asset Forfeiture and Money Laundering Unit.
Defense counsel: Edwin J. Jacobs Jr. Esq., Atlantic City, New Jersey
Bulgarian National Arrested for Conspiracy to Defraud the United States and Illegally Export Prohibited Articles to Syria in Violation of U.S. Export Control LawsRead the Press Release
Zhelyaz Andreev, 29, a Bulgarian national, was arrested pursuant to an Interpol Red Notice based on an Indictment charging him with: conspiracy to defraud the U.S. Government and substantive violations of the Syria Trade Embargo as enforced through the International Emergency Economic Powers Act (IEEPA); and the U.S. Department of Treasury Office of Foreign Assets Control’s (OFAC’s) designation of Syrian Arab Airlines, aka Syrian Air, as a Specially Designated National (SDN) whose assets are blocked and with whom U.S. nationals are prohibited from transacting business.
Assistant Attorney General for National Security John C. Demers, U.S. Attorney Benjamin G. Greenberg for the Southern District of Florida, Special Agent in Charge Robert F. Lasky of the FBI’s Miami Field Office, Special Agent in Charge Robert Luzzi of the Department of Commerce’s Office of Export Enforcement (DOC) Miami Field Office, and the members of the South Florida Joint Terrorism Task Force (JTTF), made the announcement.
Andreev was charged with conspiracy to violate IEEPA and the OFAC regulations by exporting dual-use goods, that is, articles that have both civilian and military application, to Syrian Arab Airlines, the Syrian government’s airline, which is an entity designated and blocked by OFAC for transporting weapons and ammunition to Syria in conjunction with Hizballah, a terrorist organization, and the Iranian Revolutionary Guard Corps (IRGC).
According to court documents, Andreev worked in the Bulgaria office of AW-Tronics, a Miami export company, which shipped and exported various aircraft parts and equipment to Syrian Arab Airlines. Andreev dealt directly with the Syrian Air principals who procured the parts.
Mr. Demers and Mr. Greenberg commended the investigative efforts of the FBI, DOC, U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, Defense Criminal Investigative Service, U.S. Customs and Border Protection, and the South Florida JTTF. This case is being prosecuted by Assistant U.S. Attorneys Ricardo Del Toro and Michael Thakur of the Southern District of Florida; and Trial Attorney Matthew Walczewski of the National Security Division’s Counterintelligence and Export Control Section.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov.
Bulgarian National Arrested Pursuant to a U.S.-Issued Red NoticeRead the Press Release
A Bulgarian national has been arrested pursuant to a U.S.-issued Red Notice processed by INTERPOL Washington—the U.S. National Central Bureau. Zhelyaz Andreev, 29, was indicted and charged with conspiracy to defraud the U.S. Government and substantive violations of the Syria Trade Embargo. Read the full news release here.
One of the primary missions of INTERPOL and INTERPOL Washington is to seek the location, and ultimately the arrest, of fugitives wanted in the United States and in other countries. INTERPOL Washington assists federal, state, local, and tribal authorities in the United States seeking the location of fugitives who have fled the United States, and assists foreign police in locating their fugitives believed to be in the United States. INTERPOL Washington is also responsible for seeking the publication of all INTERPOL Notices, including Red or wanted fugitives Notices, on behalf of U.S. authorities, and alerting U.S. authorities to the existence of INTERPOL Notices published on behalf of other countries.
A component of the U.S. Department of Justice, INTERPOL Washington is co-managed by the U.S. Department of Homeland Security. As the designated representative to INTERPOL on behalf of the Attorney General, INTERPOL Washington serves as the national point of contact for all INTERPOL matters, coordinating international investigative efforts among member countries and the more than 18,000 local, state, federal, and tribal law enforcement agencies in the United States.
Bothell, Wa Man Indicted for Sex Crimes Involving 14-Year-Old ChildRead the Press Release
A 24-year-old Bothell, Washington resident was indicted today by a federal grand jury on three counts of traveling for sex with a minor and one count of production of child pornography, announced U.S. Attorney Annette L. Hayes. THOMAS MAHONEY faces a mandatory minimum sentence of 15 years in prison if convicted. MAHONEY was arrested on state charges in October 2017, and was transferred to federal custody last month. Arraignment on the indictment will be scheduled later this month.
According to records filed in the case, Facebook notified the National Center for Missing and Exploited Children (NCMEC) about sexual conversations and photos being exchanged between an adult and child over its network. The information was provided to law enforcement in California where the young victim was located, and to the Seattle Internet Crimes against Children Task Force (ICAC) which traced the internet address to MAHONEY. Law enforcement served a court authorized search warrant on MAHONEY’s residence and obtained his electronic devices for analysis. Travel records confirm information from the victim that MAHONEY traveled to California three times in 2016 and 2017 to have sex with the victim. The victim was 12 years-old when MAHONEY ‘friended’ the victim on Facebook and was 14 years-old when MAHONEY initiated sex. MAHONEY made videos of the sexual contact, thereby producing child pornography.
The charges contained in the indictment are only allegations. A person is presumed innocent unless and until he or she is proven guilty beyond a reasonable doubt in a court of law.
The case is being investigated by Homeland Security Investigations (HSI) in coordination with the Seattle Police Department and the Internet Crimes Against Children Task Force (ICAC). The Contra County California District Attorney’s Office, the U.S. Attorney’s Office in the Northern District of California, and the Snohomish County Sheriff’s Department are key partners in the investigation.
The case is being prosecuted by Special Assistant United States Attorney Cecelia Gregson, with assistance from Assistant United States Attorney Christina McCall of the Northern District of California. Ms. Gregson is a Senior King County Deputy Prosecutor specially designated to prosecute child exploitation crimes in federal court.
Biloxi Felon Pleads Guilty to Possession of FirearmRead the Press Release
Gulfport, Miss – Charles Nevotney Bolton, 33, of Biloxi, entered a guilty plea today before U.S. District Judge Louis Guirola, Jr. to an indictment charging him as a felon in possession of a firearm, announced U. S. Attorney Mike Hurst and Special Agent in Charge Dana Nichols with the Bureau of Alcohol, Tobacco, Firearms and Explosives.
Bolton was charged after he admitted selling methamphetamine to a confidential informant and Biloxi police obtained a search warrant for his home where they found marijuana, methamphetamine and a handgun. Bolton has multiple felony convictions dating back to 2005.
Bolton faces a maximum penalty of 10 years in prison followed by three years of supervised release and a $250,000 fine. He will be sentenced by Judge Guirola on July 17, 2018, at 10:00 a.m.
The case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the Biloxi Police Department. Assistant United States Attorney Annette Williams is prosecuting the case.
Banner Health Agrees to Pay over $18 Million to Settle False Claims Act AllegationsRead the Press Release
Banner Health has agreed to pay the United States over $18 million to settle allegations that 12 of its hospitals in Arizona and Colorado knowingly submitted false claims to Medicare by admitting patients who could have been treated on a less costly outpatient basis, the Justice Department announced today. Headquartered in Arizona, Banner Health owns and operates 28 acute-care hospitals in multiple states.
“Taxpayers should not bear the burden of inpatient services that patients do not need,” said Acting Assistant Attorney General Chad A. Readler for the Justice Department’s Civil Division. “The Department will continue its efforts to stop abuses of the nation’s health care resources and to ensure that patients receive the most appropriate care.”
The settlement resolves allegations that 12 Banner Health hospitals knowingly overcharged Medicare patients unnecessarily. In particular, the United States alleged that from Nov. 1, 2007 through Dec. 31, 2016, Banner Health billed Medicare for short-stay, inpatient procedures provided at the 12 hospitals that should have been billed on a less costly outpatient basis. The settlement also resolves allegations that Banner Health inflated in reports to Medicare the number of hours for which patients received outpatient observation care during this time period.
“This enforcement action is another example of this office’s commitment to protecting the Medicare program,” said Elizabeth A. Strange, First Assistant United States Attorney for the District of Arizona. “The United States Attorney’s Office, working with our law enforcement partners, will continue to protect Medicare by aggressively pursuing False Claims Act allegations of wrongdoing in the health care industry.”
Banner Health also entered into a corporate integrity agreement with the U.S. Department of Health and Human Services – Office of Inspector General (HHS-OIG) requiring the company to engage in significant compliance efforts over the next five years. Under the agreement, Banner Health is required to retain an independent review organization to review the accuracy of the company’s claims for services furnished to federal health care program beneficiaries.
“Hospitals that bill Medicare for more expensive services than are necessary will be held accountable,” said Christian J. Schrank, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services. “Medical decisions should be made based on patients’ conditions and needs, not on providers’ profits.”
This settlement resolves a lawsuit filed in the U.S. District Court for the District of Arizona by Cecilia Guardiola, a former employee of Banner Health, under the qui tam or whistleblower provisions of the False Claims Act, which permit private citizens to bring lawsuits on behalf of the United States and obtain a portion of the government’s recovery. Guardiola will receive roughly $3.3 million. The case is captioned United States ex rel. Guardiola v. Banner Health and NCMC, Inc. No. 2:13-cv-02443.
The government’s resolution of this matter illustrates the government’s emphasis on combating health care fraud. One of the most powerful tools in this effort is the False Claims Act. Tips and complaints from all sources about potential fraud, waste, abuse, and mismanagement can be reported to the Department of Health and Human Services at 800-HHS-TIPS (800-447-8477).
The settlement was a result of a coordinated effort by the Civil Division, the U.S. Attorney’s Office for the District of Arizona and the HHS-OIG. The claims resolved by this settlement are allegations only and there has been no determination of liability.
Banner Health Agrees to Pay over $18 Million to Settle False Claims Act AllegationsRead the Press Release
PHOENIX – Banner Health has agreed to pay the United States over $18 million to settle allegations that 12 of its hospitals in Arizona and Colorado knowingly submitted false claims to Medicare by admitting patients who could have been treated on a less costly outpatient basis, the United States Attorney’s Office for the District of Arizona announced today. Headquartered in Arizona, Banner Health owns and operates 28 acute-care hospitals in multiple states.
The settlement resolves allegations that 12 Banner Health hospitals knowingly overcharged Medicare patients unnecessarily. In particular, the United States alleged that from November 1, 2007, through December 31, 2016, Banner Health billed Medicare for short-stay, inpatient procedures provided at the 12 hospitals that should have been billed on a less costly outpatient basis. The settlement also resolves allegations that Banner Health inflated in reports to Medicare the number of hours for which patients received outpatient observation care during this time period.
“Taxpayers should not bear the burden of inpatient services that patients do not need,” said Acting Assistant Attorney General Chad A. Readler for the Justice Department’s Civil Division. “The Department will continue its efforts to stop abuses of the nation’s health care resources and to ensure that patients receive the most appropriate care.”
“This enforcement action is another example of this office’s commitment to protecting the Medicare program,” said Elizabeth A. Strange, First Assistant United States Attorney for the District of Arizona. “The United States Attorney’s Office, working with our law enforcement partners, will continue to protect Medicare by aggressively pursuing False Claims Act allegations of wrongdoing in the health care industry.”
“Hospitals that bill Medicare for more expensive services than are necessary will be held accountable,” said Christian J. Schrank, Special Agent in Charge for the Office of Inspector General of the U.S. Department of Health and Human Services. “Medical decisions should be made based on patients’ conditions and needs, not on providers’ profits.”
Banner Health also entered into a corporate integrity agreement with the U.S. Department of Health and Human Services – Office of Inspector General (HHS-OIG) requiring the company to engage in significant compliance efforts over the next five years. Under the agreement, Banner Health is required to retain an independent review organization to review the accuracy of the company’s claims for services furnished to federal health care program beneficiaries.
This settlement resolves a lawsuit filed in the United States District Court for the District of Arizona by Cecilia Guardiola, a former employee of Banner Health, under the qui tam or whistleblower provisions of the False Claims Act, which permit private citizens to bring lawsuits on behalf of the United States and obtain a portion of the government’s recovery. Ms. Guardiola will receive roughly $3.3 million. The case is captioned United States ex rel. Guardiola v. Banner Health and NCMC, Inc., No. 2:13-CV-02443.
The government’s resolution of this matter illustrates the government’s emphasis on combating health care fraud. One of the most powerful tools in this effort is the False Claims Act. Individuals with information regarding fraud, waste, or abuse related to Medicare or other federal programs are encouraged to file a complaint with the United States Attorney’s Office through the office’s website, http://www.justice.gov/usao/az/, or by calling (602) 514-7500.
The settlement was a result of a coordinated effort by the Civil Division, the United States Attorney’s Office for the District of Arizona, and the HHS-OIG. The claims resolved by this settlement are allegations only, and there has been no determination of liability.
RELEASE NUMBER: 2018-035_Banner
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For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.
Bangor Man Sentenced to 40 Years for Sexual Exploitation of Children and Possession of Child PornographyRead the Press Release
Bangor, Maine: United States Attorney Halsey B. Frank announced that Jeffrey Swimm, 38, of Bangor, was sentenced today in U.S. District Court by Judge John A. Woodcock, Jr. to 40 years in prison and supervised release for life for sexual exploitation of children and possession of child pornography. Swimm pled guilty on August 23, 2017.
According to court records, between about October 2012 and April 2017, Swimm produced still-image and video files depicting child pornography, some of which were produced using a camera hidden in the defendant’s bathroom. Swimm admitted to agents that, over a three year period, he produced pornographic images and videos depicting multiple prepubescent minors, so that he had them to trade with other people he met on-line. In addition, the defendant possessed other images and videos of child pornography depicting children under the age of 12 which he solicited and received over the internet.
The investigation was conducted by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the Bangor Police Department, and the Penobscot County Sheriff’s Office.
Backpage’s Co-founder and CEO, as Well as Several Backpage-Related Corporate Entities, Enter Guilty PleasRead the Press Release
Earlier this week, the Justice Department announced the seizure of Backpage.com, the Internet’s leading forum for prostitution ads, including ads depicting the prostitution of children, and the unsealing of a 93-count federal indictment against seven Backpage principals. Today, the Justice Department announced that Backpage’s co-founder and CEO, Carl Ferrer, 57, of Frisco, Texas, has pleaded guilty to conspiracy to facilitate prostitution using a facility in interstate or foreign commerce and to engage in money laundering. Additionally, several Backpage-related corporate entities, including Backpage.com LLC, have entered guilty pleas to conspiracy to engage in money laundering.
Attorney General Jeff Sessions, Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, First Assistant U.S. Attorney Elizabeth A. Strange for the District of Arizona, FBI Director Christopher A. Wray, U.S. Postal Inspection Service Chief Postal Inspector Guy Cottrell and Chief Don Fort of Internal Revenue Service Criminal Investigation (IRS-CI) made the announcement.
“For far too long, Backpage.com existed as the dominant marketplace for illicit commercial sex, a place where sex traffickers frequently advertised children and adults alike,” said Attorney General Sessions. “But this illegality stops right now. Last Friday, the Department of Justice seized Backpage, and it can no longer be used by criminals to promote and facilitate human trafficking. I want to thank everyone who made this important seizure possible: all of our dedicated and committed professionals in the Child Exploitation and Obscenity Section and our U.S. Attorney’s Office in the District of Arizona, the FBI, our partners with the IRS Criminal Investigation, our Postal Inspectors, and the Texas and California Attorney Generals’ offices. With their help, we have put an end to the violence, abuse, and heartache that has been perpetrated using this site, and we have taken a major step toward keeping women and children across America safe.”
“Backpage has earned hundreds of millions of dollars from facilitating prostitution and sex trafficking, placing profits over the well-being and safety of the many thousands of women and children who were victimized by its practices,” said First Assistant U.S. Attorney Elizabeth A. Strange. “It is appropriate that Backpage is now facing criminal charges in Arizona, where the company was founded, and I applaud the tremendous efforts of the agents who contributed to last Friday’s enforcement action and who assisted in obtaining the indictment in this case. Some of the internal emails and company documents described in the indictment are shocking in their callousness.”
“This website will no longer serve as a platform for human traffickers to thrive, and those who were complicit in its use to exploit human beings for monetary gain will be held accountable for their heinous actions,” said FBI Director Wray. “Whether on the street or on the Internet, sex trafficking will not be tolerated. Together with our law enforcement partners, the FBI will continue to vigorously combat this activity and protect those who are victimized.”
“The events of last Friday and this week are a big win, not only for the agents who investigated these crimes, but more importantly for the victims, including children, who were harmed as a consequence of the alleged actions of Backpage.com,” said Chief Postal Inspector Cottrell. “By laundering the illegal gains of an enterprise, Backpage perpetuated the exploitation of victims and continued to finance their business. The U.S. Postal Inspection Service is committed to protecting our customers by stopping the money laundering to ensure the cycle of victimization ends.”
“An indictment of this magnitude is particularly troubling when you look at the various layers of corruption and exploitation that are alleged to have occurred,” said IRS-CI Chief Fort. “The masterminds behind Backpage are not only alleged to have committed egregious amounts of financial crimes such as money laundering, they did so at the expense of innocent women and children. While these types of investigations can be made more challenging with the use of virtual currency, offshore banking, and the anonymity of the Internet, it should serve as an example to all criminals that there is not a place they can hide where we will not find them.”
According to the factual basis of his plea agreement, Ferrer admitted that he had long been aware that the great majority of Backpage’s “escort” and “adult” advertisements are, in fact, advertisements for prostitution services, which are not protected by the First Amendment and which are illegal in 49 states and in much of Nevada. Ferrer further admitted that he conspired with other Backpage principals to find ways to knowingly facilitate the state-law prostitution crimes being committed by Backpage’s customers. For example, he worked with his co-conspirators to create “moderation” processes through which Backpage would remove terms and pictures that were particularly indicative of prostitution and then publish a revised version of the ad. Ferrer admitted that these editing practices were only one component of an overall, company-wide culture and policy of concealing and refusing to officially acknowledge the true nature of the services being offered in Backpage’s “escort” and “adult” ads.
In the factual basis of his plea agreement, Ferrer also admitted that he conspired with other Backpage principals to engage in various money laundering offenses. According to the factual basis, since 2004, Backpage has earned hundreds of millions of dollars in revenue from publishing “escort” and “adult” ads. Over time, many banks, credit card companies, and other financial institutions refused to do business with Backpage due to the illegal nature of its business. In response, Ferrer admitted that he worked with his co-conspirators to find ways to fool credit card companies into believing that Backpage-associated charges were being incurred on different websites, to route Backpage-related payments and proceeds through bank accounts held in the name of seemingly unconnected entities, and to use cryptocurrency-processing companies for similar purposes.
Ferrer’s plea agreement also requires him to take all steps within his power to immediately shut down the Backpage website, including providing technical assistance to the United States to effectuate the shutdown, and to take all steps within his power to forfeit to the United States all corporate assets and other property owned or controlled by various Backpage-related entities. The plea agreement provides that, if Ferrer fails to comply with either of these requirements, the plea agreement shall be null and void and the United States may bring additional charges against Ferrer. Ferrer’s plea agreement, and the corporate plea agreements, also consent to the forfeiture of certain assets and items of property, including various domain names associated with the Backpage website.
The seven defendants charged in the 93-count indictment were all arrested on Friday, April 6. They are Michael Lacey, 69, of Paradise Valley, Arizona; James Larkin, 68, of Paradise Valley, Arizona; Scott Spear, 67, of Scottsdale, Arizona; John E. “Jed” Brunst, 66, of Phoenix, Arizona; Daniel Hyer, 49, of Dallas, Texas; Andrew Padilla, 45, of Plano, Texas; and Jaala Joye Vaught, 37, of Addison, Texas. On April 6, Vaught had her initial court appearance before U.S. Magistrate Judge Eileen Willett of the District of Arizona and was released from custody pending trial. Lacey, who also had his initial court appearance on April 6 before Judge Willett, subsequently had a detention hearing on April 11 before U.S. Magistrate Judge Bridget S. Bade of the District of Arizona and was ordered to temporarily remain in custody until his continued hearing on Friday, April 13. On April 9, Larkin, Spear, and Brunst had their initial court appearances before Judge Bade. Larkin has since been ordered to temporarily remain in custody until a continued detention hearing on Monday, April 16, and Spear and Brunst were released from custody pending trial. Also on April 9, Hyer had his initial court appearance before U.S. Magistrate Judge David L. Horan in the Northern District of Texas and was released from custody pending trial, and Padilla had his initial court appearance before U.S. Magistrate Judge Christine A. Nowak in the Eastern District of Texas and was released from custody pending trial.
The charges and allegations contained in an indictment are merely accusations. The defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The effort to seize Backpage was led by the Justice Department’s Child Exploitation and Obscenity Section and the U.S. Attorney’s Office for the District of Arizona, with significant support from the U.S. Attorney’s Office for the Central District of California, the office of the California Attorney General, and the office of the Texas Attorney General. The law enforcement agencies conducting the investigation and seizure include the FBI Phoenix Field Office, the U.S. Postal Inspection Service and IRS-CI. The criminal case is being prosecuted by Assistant U.S. Attorneys Kevin Rapp, Dominic Lanza, and Margaret Perlmeter of the District of Arizona and Senior Trial Attorney Reginald E. Jones of the Criminal Division’s Child Exploitation and Obscenity Section. Assistant U.S. Attorney John Kucera of the Central District of California is handling the asset forfeiture aspects of the case