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15 May 2018
18 Defendants Sentenced in Bank Card SchemeRead the Press Release
Tirrell Thomas, the Michigan leader of the scheme, sent to prison for 102 months
GRAND RAPIDS, MICHIGAN — Tirrell Perry Thomas, the Michigan leader of a scheme to defraud Bank of America, was sentenced to 102 months (8.5 years) in federal prison as part of an ongoing multi-state investigation that has resulted in felony convictions for 18 participants, U.S. Attorney Andrew Birge announced today. The Honorable Paul L. Maloney, U.S. District Judge, sentenced Thomas and the other defendants for their involvement in the bank card fraud scheme, which sought to obtain more than $780,000 from Bank of America and resulted in losses totaling $455,709. This is Thomas’s third federal felony conviction. He was convicted of federal drug trafficking offenses in 1999 and 2007.
The following defendants were sentenced for their respective roles in the fraud scheme, including accountholders who opened or used Bank of America accounts to accept fraudulent check deposits and then make fraudulent withdrawals at banks and casinos, mid-level recruiters who accompanied and directed accountholders on trips to open bank accounts and withdraw funds, and the leaders and organizers of the scheme, who collected and divided the fraud proceeds:
- Tirrell Perry Thomas (Kalamazoo): 102 months in prison
- Earl Lee Cobb IV (Chicago): 78 months in prison
- Nickolas Maurice Fry (Kalamazoo): 41 months in prison, plus an additional 13 months in prison for a related federal supervised release violation
- Jerome Datra Perry (South Haven): 15 months in prison
- Josiah Nathan Preston (Wyoming): 14 months in prison
- Kyle Dwayne Mosley (Kalamazoo): 14 months in prison
- James Langford (South Haven): 12 months and one day in prison
- Darmesha Lakeya Gunn (Parchment): 11 months in prison
- Dwayne Edward Perry (Grand Rapids): 8 months in prison
- Tiffany Danielle Sanders (Sturgis): 4 months in prison
- Elnora Snipes (South Haven): 3 months in prison
- Desiree Analiese Winfield (Kalamazoo): 2 months in prison
- Antoine Naivon Younger (Kalamazoo): 1 month in prison
- Brenda Marie Davis (Kalamazoo): 1 day in prison
- Sean Allen Haney (Grand Rapids): 3 years of probation
- Kelsey Alice Thompson (Grand Rapids): 2 years of probation
- Kevin Lavelle Hunter II (Kalamazoo): 2 years of probation
- Crystal Kaye Pugh (Norton Shores): 2 years of probation
In addition to the prison and probation sentences, each defendant sentenced to prison will serve a period of supervised release after their custodial sentence, and each defendant was ordered to pay restitution to Bank of America ranging from $8,027 to $455,709, depending on the amount of actual loss for which they were held responsible.The sentencings follow a 28-count indictment that was returned by a grand jury in August 2017 alleging that 19 people participated in a conspiracy to defraud Bank of America in November and December 2015. The fraud was accomplished by using debit cards to withdraw funds from ATMs and casinos in Michigan, which had been fraudulently deposited into the bank accounts in Illinois, by Chicago co-conspirator Earl Lee Cobb IV. Eighteen defendants pled guilty to at least one count in the indictment and one defendant, an accountholder, was allowed to enter a period of pretrial diversion, a form of probation without entry of a guilty plea.
This matter was investigated by the Detroit Division of the Federal Bureau of Investigation and the U.S. Postal Inspection Service in Chicago, with assistance from the Nottawaseppi Huron Band of Potawatomi Tribal Police Department. The case was prosecuted by Assistant U.S. Attorneys Kate Zell and Christopher O’Connor.
END
'Ordinary' Officers Perform an Extraordinary ServiceRead the Press Release
Officer Gary Michael, Jr., had been on duty at his dream job with the Clinton Police Department for less than a year when he conducted a routine traffic stop. Sergeant Carl Cosper, Jr., traveled a familiar stretch of highway when he responded to a routine domestic violence call.
Neither Officer Michael nor Sergeant Cosper returned home to their families after those routine calls; both were killed in the line of duty. Their deaths remind us that, for those sworn to protect and serve, nothing is routine. Every ordinary day could present a matter of life and death. Every ordinary officer makes a hero’s decision, on a daily basis, to do something quite extraordinary – to put their lives on the line for the sake of their community.
Officer Michael and Sergeant Cosper are two of the 129 law enforcement officers in the United States to fall in the line of duty in 2017. They made the ultimate sacrifice, and we owe them our undying gratitude.
There is no more important duty of government than to protect its citizens from harm. In the cause of public safety, law enforcement officers are our first line of defense. Speaking for myself as well as the Department of Justice, we will continue to “Back the Blue,” as Attorney General Jeff Sessions says, as we are all united in our efforts to reduce crime in America.
Aside from national security, my highest priority is to reduce violent crime and make our neighborhoods safer. As we reinvigorate our efforts to take guns out of the hands of criminals, curb drug trafficking, and eradicate gangs, we rely on our partners in law enforcement. Collaboration with state and local law enforcement is critical for the Department of Justice.
We not only need the support of our law enforcement partners to accomplish this goal, but we need the community’s support as well. Officer Michael and Sergeant Cosper are two good examples of the risks we ask our law enforcement officers to take every day. We can show our appreciation for their sacrifice, and the sacrifices of many other officers, by supporting their brothers and sisters in uniform who continue that good, essential work.
As a small gesture of our nation’s appreciation, flags will be flown at half-staff today in recognition of National Peace Officers Memorial Day as we honor law enforcement officers killed or disabled in the line of duty. This is part of National Police Week, an annual tribute to law enforcement service and sacrifice.
Each year, tens of thousands of law enforcement officers from around the world converge on Washington, D.C., to participate in a number of events to honor those who paid the ultimate sacrifice. Les Kerr, Law Enforcement Coordinator for the Western District of Missouri, will represent us by attending this year’s events.
National Police Week began last Sunday night with a candlelight vigil on the National Mall in Washington, D.C. The names of fallen officers, engraved on the walls of the National Law Enforcement Officers Memorial, were formally dedicated.
The names of Officer Michael and Sergeant Cosper – the two law enforcement officers from the Western District of Missouri who were killed in the line of duty in 2017 – have been engraved on the National Law Enforcement Officers Memorial. Additionally, the recently discovered name of an officer killed in the line of duty in 1917 has been added to the wall.
Even as we honor these fallen heroes, we also grieve the lives of three more law enforcement officers sacrificed since I was sworn in as United States Attorney in January. Next year, the name of another Clinton Police Department officer, Christopher Ryan Morton, along with Miller County Deputy Sheriff Casey Lee Shoemate will be engraved on the memorial wall. We also recently suffered the loss of FBI Special Agent Melissa S. Morrow, 48, who died from brain cancer as a result of being exposed to hazardous contaminants when she rushed to help survivors at the Pentagon during the terrorist attacks on Sept. 11, 2001, and participated in the investigation afterward.
May these public servants, each of whom made the ultimate sacrifice for the highest good, inspire us to honor their memory by continuing their legacy of serving and protecting our community.
Officer Gary Michael, Jr.
Officer Gary Michael, Jr., 37, of the Clinton Police Department, was shot and killed during a traffic stop on Aug. 6, 2017. Officer Michael stopped a vehicle for suspected registration violation. The driver exited the vehicle and opened fire with a rifle. Despite being mortally wounded, Officer Michael was able to return fire and wounded the subject. The man fled the scene in his vehicle, which crashed two blocks away, then he fled on foot but was apprehended two days later. Officer Michael was rushed to the hospital, where he later died.
Officer Michael was a U.S. Army veteran and had served with the Clinton Police Department for less than one year.
Master Sergeant Deputy Sheriff Carl Cosper, Jr.
Master Sergeant Deputy Sheriff Carl Cosper, Jr., 56, of the Barry County Sheriff’s Department was killed in a vehicle collision on April 7, 2017. Sergeant Cosper was responding to a domestic violence call in Seligman, Mo. As he traveled south on Missouri 37, approximately a half-mile south of Washburn, his patrol car struck another vehicle that turned in front of him. Sergeant Cosper was taken to a local hospital where he succumbed to his injuries.
Sergeant Cosper began his career in law enforcement in 1994 with the McDonald County Sheriff's Department. He went on to serve with the Barry County Sheriff's Department for 10 years. In addition to being a deputy, he was also a firearms instructor, training agent, and taught classes for people who wanted conceal-carry permits.
Deputy Sheriff Edward Culver
Deputy Edward Culver, 60, of the Platte County Sheriff’s Department, was shot and killed on June 23, 1917, while breaking up a fight at a saloon in Drydale. The subject was able to disarm another deputy and shot Deputy Culver in the chest. Despite being mortally wounded, Deputy Culver returned fire and killed the subject.
Deputy Culver had served with the Platte County Sheriff's Office for four years.
14 May 2018
Worcester Business Owner Sentenced to 14 Years in Prison for Fentanyl Distribution and Money LaunderingRead the Press Release
BOSTON – A Worcester business owner was sentenced today in federal court in Worcester for distributing fentanyl and using the proceeds of drug sales to purchase and renovate nine properties and two restaurants in Worcester County.
Kevin A. Perry, 44, of Worcester, was sentenced by U.S. District Court Judge Timothy S. Hillman to 14 years in prison and five years of supervised release. Perry was also ordered to forfeit nine properties, the business assets of two restaurants, over $510,000 in cash and precious metals seized to date, an illegal pill press, and two vehicles. The sentence also includes a money judgment of $1,180,943 against Perry should additional assets be located. In October 2017, Perry pleaded guilty to nine counts of money laundering, three counts of aggravated cash structuring, one count of making a false statement on a loan application, and one count of distribution of fentanyl.
Perry was previously convicted in federal court in Massachusetts of conspiracy to manufacture and distribute MDMA, commonly referred to as Ecstasy. Despite filing an affidavit claiming he possessed nothing of monetary value to satisfy the court’s forfeiture order, Perry boasted to an individual that he successfully concealed from the government “millions of dollars” in profits from drug sales. Following his release from prison in 2008, Perry returned to the manufacturing and distribution of controlled substances, including fentanyl, the deadly synthetic opioid linked to thousands of fatal drug overdoses. On Feb. 23, 2017, Perry distributed 2,000 pills containing fentanyl to an individual cooperating with law enforcement.
Additionally, from April 2012 to October 2016, Perry used over $1 million in proceeds from drug sales to purchase and renovate nine properties in Worcester County. Those purchases included two restaurants in the city of Worcester: The Usual Restaurant located at 166 Shrewsbury Street and The Blackstone Tap located at 81 Water Street. Perry also used the proceeds from his drug sales to purchase more than 230 money orders totaling over $150,000 from the United States Postal Service and Western Union to make structured cash payments on real estate loans and to finance his wedding in August 2015. The only employment that Perry reported during that time was as a fitness trainer. He also collected unemployment benefits from June 2015 through January 2016.
United States Attorney Andrew E. Lelling; Albert Angelucci, Acting Special Agent in Charge of the Drug Enforcement Administration, Boston Field Division; Delany De Leon-Colon, Acting Inspector in Charge of the United States Postal Inspection Service; and Worcester Police Chief Steven M. Sargent made the announcement today. Assistant U.S. Attorney Greg A. Friedholm of Lelling’s Worcester Branch Office prosecuted the case.
White County Business Owner Sentenced to Three Years in Prison for $43 Million Investment SchemeRead the Press Release
Jeffery Lynn Gentry, 40, of White County, Tennessee, was sentenced today in U.S. District Court to 36 months in prison, followed by three years of supervised release, for wire fraud and money laundering, announced U.S. Attorney Don Cochran for the Middle District of Tennessee. U.S. District Court Judge Aleta A. Trauger also ordered Gentry to pay $10, 410,672.74 in restitution.
Gentry was charged on July 5, 2017, with operating a $43 million investment scheme in which he bilked investors out of more than $10 million. He pleaded guilty on August 10, 2017.
According to court documents, Gentry owned and operated Gentry Brothers Tractor Supply and Gentry Auto, both located in Sparta, Tennessee. Beginning in 2012 and continuing to mid-December of 2016, Gentry devised and executed a scheme to defraud and obtain money and property from investors, promising high rates of return on investments, purportedly used to purchase farm-related equipment to satisfy state contracts and producing significant profits.
Gentry falsely represented to investors, including customers, friends, acquaintances, and family members, many of whom lived in White County, Tennessee, that he was bidding on and winning contracts from various states, including Tennessee, to supply equipment, including tractors, lawn mowers, and other farm-related equipment through his tractor supply company.
Through this scheme, Gentry convinced more than 50 individuals to invest funds totaling approximately $43 million and caused financial loss to investors of more than $10 million.
Despite his assurances to investors of significant returns, Gentry admitted that he never intended to invest the funds as promised but instead, used the money to subsidize his lifestyle, amassing assets worth a substantial amount of money, including numerous tracts of real estate and vehicles.
In March 2016, Gentry also used investor funds to start up and support a new business venture, Gentry Auto, a used car lot, transferring more than $365,000 of investor funds from the Gentry Brothers Tractor Supply Company to the Gentry Auto business between March 24, 2016 and December 6, 2016.
During this investigation, the Asset Forfeiture Unit of the U.S. Attorney’s Office and the U.S. Marshals’ Service seized the assets of Gentry, including his businesses, vehicles, farm equipment and livestock, houses, tracts of land and approximately $300,000 cash. These assets were liquidated on August 26, 2017, by the U.S. Marshals’ Service at an auction in Sparta, Tennessee. This auction and other liquidation proceedings generated more than $1.3 million for victim restoration.
This case was investigated by the FBI, the IRS-Criminal Investigation and the U.S. Marshal’s Service. The case is being prosecuted by Assistant U.S. Attorney Kathryn Risinger and Assistant U.S. Attorney Debra Phillips handled the forfeiture of Gentry’s assets.
United States Reaches Settlement with Riverdale Internist to Resolve False Claims Act Allegations Relating to Medically Unnecessary ProceduresRead the Press Release
FOR IMMEDIATE RELEASE CONTACT ELIZABETH MORSE
www.justice.gov/usao/md (410) 209-4885
Baltimore, Maryland – Sureshkumar Muttath, M.D., an internist in Riverdale, Maryland, has agreed to pay the United States $1,526,038 to settle allegations that he submitted false claims to the United States for medically unnecessary autonomic nervous function tests and neurobehavioral status exams.
The settlement agreement was announced today by United States Attorney for the District of Maryland Robert K. Hur, Special Agent in Charge of the Office of Inspector General for the Department of Health and Human Services, Maureen Dixon, and Maryland Attorney General, Brian Frosh.
In his practice, Dr. Muttath administered central autonomic nervous function tests and mini-mental exams. Autonomic nervous function disorders are relatively uncommon disorders and tests conducted to determine such disorders should be done only after a clinician suspects such a disorder. Furthermore, according to Local Coverage Determinations (“LCDs”) from Novitas, the Medicare administrative contractor for Maryland, such tests should be conducted only one time per beneficiary, with the necessary equipment and by clinicians with specialized training to administer and interpret these tests. The CPT codes that Dr. Muttath used for central autonomic nervous function tests were 95921, 95922, and 95924. Additionally, Dr. Muttath assessed patients using mini-mental status exams that he billed as a neurobehavioral status exams using CPT code 96116.
According to the settlement agreement, from January 1, 2011 to June 30, 2017, Dr. Muttath submitted claims to Medicare and Medicaid for medically unnecessary autonomic nervous function tests (CPT codes 95921-95924). The United States contends that these tests were not medically necessary and otherwise were excluded from coverage under both programs because Dr. Muttath did not have the necessary equipment to perform these tests; the patients who underwent the testing had not been diagnosed clinically with an autonomic function disorder before Dr. Muttath conducted the tests; Dr. Muttath did not have the specific training required to conduct autonomic function tests or interpret the results thereof; Dr. Muttath failed to follow Novitas’s Local Coverage Determinations (L34788 and L35395) regarding coverage indications, limitations, and medical necessity for autonomic function testing; and Dr. Muttath performed autonomic function tests merely to monitor patient symptoms or conduct patient screenings without signs or symptoms of autonomic dysfunction and not to make any clinical decisions or manage patient care.
With regard to the neurobehavioral status exam claims billed by Dr. Muttath using CPT code 96116, the United States alleges that Dr. Muttath misrepresented the services he actually performed (mini-mental status exams) as neurobehavioral status exams because he failed to spend the required amount of time either face-to-face with the patient or interpreting the tests and preparing the reports and because he did not conduct the required assessments of the patients’ thinking, reasoning, and judgment to submit claims under CPT code 96116.
Dr. Muttath denied the United States’ allegations.
Also as part of the settlement, Sureshkumar Muttath, M.D. has agreed to enter into an expansive, three-year Integrity Agreement that provides for procedures and reviews to be put in place to avoid and promptly detect conduct similar to that which gave rise to the settlement.
The civil settlement was reached by the United States Attorney’s Office for the District of Maryland. The Integrity Agreement was negotiated by the Office of the Counsel to the Inspector General of the Department of Health and Human Services.
This case arose from a recent initiative inside the United States Attorney’s Office. The United States Attorney’s Office has dedicated resources to enable it to review Medicare billing data. The review of that data has enabled the United States Attorney’s Office to identify areas of concern where it appears that billing irregularities may have taken place. Partnering with the affected agencies, the United States Attorney’s Office has developed the ability to investigate these billing irregularities to determine whether the matter should be pursued under the False Claims Act.
United States Attorney Robert K. Hur commended the HHS Office of Inspector General for its work in the investigation. Mr. Hur also thanked Assistant United States Attorneys Thomas Corcoran and Neil White who handled the case.
United States Reaches $125,000 Civil SettlementRead the Press Release
St. Louis, Missouri: The United States Attorney’s Office for the Eastern District of Missouri announced today that the United States, Foot Healers Holdings – St. Louis and its subsidiaries (Foot Healers) reached a civil settlement that will resolve the United States' claims against Foot Healers under the False Claims Act for knowingly submitting false claims to Medicare for podiatry services. According to the United States’ allegations, from March 1, 2010 through July 31, 2016, Foot Healers submitted false claims to Medicare by using improper modifiers that caused Medicare to pay for improper claims and by submitting claims for payment which falsely indicated a medically necessary toenail debridement was provided when the service actually provided was a routine nail trimming not covered by Medicare. As part of the civil settlement, Foot Healers will repay the United States $125,000.
Foot Healers has also entered into a three-year Integrity Agreement with the United States Department of Health and Human Services, Office of Inspector General (HHS-OIG). Pursuant to the terms of the Integrity Agreement, Foot Healers must comply with a number of obligations to ensure that it remains compliant with Federal health care program requirements.
This civil settlement is part of ongoing efforts by the Department of Justice and the United States Department of Health and Human Services to recover funds diverted from Medicare and is the result of the combined work of the U.S. Attorney's Office for the Eastern District of Missouri and HHS-OIG Office of Investigations.
United States Attorney Nick Hanna Marks National Police Week by Recognizing the Service and Sacrifice of Law Enforcement OfficersRead the Press Release
LOS ANGELES – To mark National Police Week, United States Attorney Nicola T. Hanna and Attorney General Jeff Sessions are honoring the service and sacrifice of federal, state and local police officers who put their lives on the line every day they put on their uniforms.
The United States Attorney’s Office for the Central District of California is actively engaged this month in a host of activities to support and honor our law enforcement partners, especially during Police Week.
In October 1962, Congress passed, and President Kennedy signed, a joint resolution declaring May 15 as National Peace Officers Memorial Day to honor law enforcement officers killed or disabled in the line of duty. The resolution also created National Police Week as an annual tribute to law enforcement service and sacrifice.
During Police Week, which is being observed this year from May 13 through May 19, our nation celebrates the contributions of police officers from around the country, recognizing their hard work, dedication, loyalty and commitment in keeping our communities safe.
“The partnership we maintain with our local law enforcement partners is an integral component of our violent crime strategy,” said United States Attorney Hanna. “Whether working alongside them in an investigation or honoring their sacrifice, we are proud of their service to the residents of this district.”
Members of the United States Attorney’s Office participated in the annual Los Angeles Police Department Memorial Service last week to honor fallen officers killed in the line of duty. United States Attorney Hanna was an honored guest at this event.
Last week, United States Attorney Hanna attended the Federal Bureau of Investigation’s annual memorial honoring fallen FBI agents.
The office hosted a two-day VALOR Survive & Thrive training for nearly 100 law enforcement officers from across the region last week. The training, which was sponsored by the Bureau of Justice Assistance, was co-hosted by the Glendora Police Department and the Western States Information Network.
United States Attorney Hanna and members of the office participated earlier this month in tactical entry, shoot/no-shoot scenario training that was organized by the Bureau of Alcohol, Tobacco, Firearms and Explosives and the United States Marshals Service. The training enabled office personnel to become more aware of the types of scenarios law enforcement officers and agents face every day, especially when they are serving warrants. The training allowed an opportunity for senior leadership to further understand and enhance the training needs of law enforcement within our district.
United States Attorney Hanna highlighted his office’s violent crime strategy and opportunities for increased collaboration with local law enforcement Thursday at the International Latino Gang Investigators Conference, which took place last week in Ontario.
Thursday night, Mr. Hanna attended and provided welcome remarks at the California Narcotics Officers Association annual awards dinner that honors law enforcement officers working narcotics cases.
The United States Attorney and members of his staff attended the Los Angeles Police Department Recruit Graduation Friday, and will attend the Los Angeles County Sheriff’s Department Fallen Deputy memorial to honor deputies killed in the line of duty this week.
“One officer death is too many,” Attorney General Sessions said. “While we are inexpressibly grateful to have had a decrease in the number of officers killed in the line-of-duty last year, the number is still far too high. At the Department of Justice, we honor the memories of the fallen and we pray for their families. We are also following President Trump's Executive Orders to back the women and men in blue, to enhance law enforcement safety, and to reduce violent crime in America. Those priorities will help keep every American safe, including those who risk their lives for us. As always, we have their backs and they have our thanks.”
According to statistics collected by the FBI, 93 law enforcement officers were killed in line-of-duty incidents in 2017 – a 21 percent decrease from 2016 when 118 law enforcement officers were killed in line-of-duty incidents.
Additionally, in 2017 there were 46 law enforcement officers killed in line-of-duty incidents because of felonious acts – this is a 30 percent decrease from 2016, when 66 law enforcement officers were killed in line-of-duty incidents as a result of felonious acts.
To access the FBI's 2017 Law Enforcement Officers Killed and Assaulted report, please visit www.fbi.gov.
For more information about other National Police Week events, please visit www.policeweek.org.
United States Attorney Mike Stuart and FBI Officials Present over $1 Million in Forfeited Proceeds to the West Virginia State PoliceRead the Press Release
CHARLESTON, W.VA. – United States Attorney Mike Stuart announced today the West Virginia State Police received $1,087,285.15 as a result of a civil forfeiture action relating to violations of the Bank Secrecy Act by First National Bank of Williamson. The Bank Secrecy Act requires financial institutions to maintain programs that detect and report suspicious activity that may signify money laundering. Under this law, banks must prepare and file Cash Transaction Reports for all cash transactions over $10,000. The Bank Secrecy Act also makes structuring a federal crime that involves the breaking down of cash banking transactions in amounts of $10,000 or less to avoid triggering a bank’s reporting requirement. First National Bank agreed to forfeit $1,360,000 to the United States, which represents the sum of transactions uncovered.
Stuart commended the efforts of the Federal Deposit Insurance Corporation Office of the Inspector General, the Federal Bureau of Investigation, and the West Virginia State Police Bureau of Criminal Investigation.
“The scheme set up by White and others to deceive federal authorities should never have been permitted by the bank,” said United States Attorney Mike Stuart. “In every instance where we identify a federal institution intentionally aiding and abetting illegal activities, we will use every tool possible, including forfeiture, to ensure the institution pays a very heavy price. I am happy that over $1 million forfeited by the bank in this case can now be used by WV State Police to further its missions and good work for the citizens of our great state.”
Between April 2006 and November 2008, Arthur White, Jr., and other individuals, structured $1.36 million in cash withdrawals in increments of exactly $10,000 from First National Bank of Williamson in order to avoid triggering the mandatory reports. In March 2013, Arthur White pleaded guilty in the United States District Court for the Southern District of West Virginia to tax evasion and structuring. White admitted that he cashed checks made payable to his companies that held accounts at First National Bank of Williamson. According to the complaint, First National Bank permitted White to pay cash for cashiers’ checks made payable to himself, without first depositing the money into any account.
As part of the scheme, White and other individuals would receive exactly $10,000 in cash each time they cashed a check. They would then purchase a new cashier’s check without depositing any of the money, repeating the process until the entire check had been converted to cash. The cash obtained through this structuring was used to pay wages for some of White’s employees. White, and others at his direction, intentionally conducted these transactions to avoid triggering the bank’s reporting requirements and to evade taxes.
As set forth in the complaint, despite First National Bank's knowledge of these transactions, it permitted this structuring and failed to report these transactions as required by law.
"The dismantlement is a result of the investigation and successful prosecution which enables and triggers asset forfeiture," said FBI Pittsburgh Assistant Special Agent in Charge Nick Boshears. "The funding provides for things like new vehicles, bulletproof vests, opioid overdose reversal kits and better training for our law enforcement partners."
“We are pleased to join our law enforcement partners in recognizing the successful results of this case,” said Federal Deposit Insurance Corporation’s Deputy Assistant Inspector General for Investigations, Francis L. Mace. “Today’s sharing of forfeiture proceeds will provide the members of the West Virginia State Police with funds that can be used to further their important mission of serving the citizens of West Virginia.”
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U.S. Attorney Kennedy Recognizes Law Enforcement Service and Sacrifice During National Police WeekRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051FBI Releases 2017 Statistics on of Law Enforcement Officers Killed and Assaulted
BUFFALO, NY – U.S. Attorney James P. Kennedy, Jr. is joining with Attorney General Jeff Sessions to recognize the service and sacrifice of federal, state, local, and tribal police officers during National Police Week, May 13-19, 2018.According to statistics collected by the FBI, 93 law enforcement officers were killed in line-of-duty incidents in 2017 – a 21 percent decrease from 2016 when 118 law enforcement officers were killed in line-of-duty incidents.
Among the 93 killed was Buffalo Police Officer Craig Lehner who drowned during a training exercise in the Niagara River. Lehner’s body was recovered on October 17, 2017. Officer Lehner’s name and the names of all 93 fallen officers nationwide were formally dedicated on the National Law Enforcement Officers Memorial in Washington, DC, during the 30th Annual Candlelight Vigil on the evening of May 13, 2018.
“While it takes many important attributes to be a successful police officer – courage, toughness, intelligence – the one attribute shared by the very best in the law enforcement profession is a sense of selfless love,” said U.S. Attorney Kennedy. “Love for their fellow man. Love for their community. Love for the rule of law. Love for their country.”
“One officer death is too many,” Attorney General Sessions said. “While we are inexpressibly grateful to have had a decrease in the number of officers killed in the line-of-duty last year, the number is still far too high. At the Department of Justice, we honor the memories of the fallen and we pray for their families. We are also following President Trump's Executive Orders to back the women and men in blue, to enhance law enforcement safety, and to reduce violent crime in America. Those priorities will help keep every American safe, including those who risk their lives for us. As always, we have their backs and they have our thanks.”
During Police Week, our nation celebrates the contributions of police officers from around the country, recognizing their hard work, dedication, loyalty and commitment in keeping our communities safe. A number of commemorative events are taking place across the country and locally. U.S. Attorney Kennedy took part the Law Enforcement Memorial Service in Buffalo this morning at St. Joseph Cathedral. Tomorrow, May 15, he will take part in the New York State Police Troop “A” Memorial Service in Batavia, NY.
U.S. Attorney Kennedy further stated, “I offer condolences to the families of our fallen heroes and a humble thanks to all of the men and women of federal, state and local law enforcement – living and deceased. Though they cover their hearts with badges, through those badges shine some of the finest hearts known to humanity. Today we honor those in law enforcement who give their hearts, and their lives, for their fellow man.”
Of the 93 officers killed in 2017, 46 were killed in line-of-duty incidents as a result of felonious acts – this is a 30 percent decrease from 2016, when 66 law enforcement officer were killed in line-of-duty incidents as a result of felonious acts.
For more information on the 2017 Law Enforcement Officers Killed and Assaulted report, go to https://ucr.fbi.gov/leoka/2017.
In October 1962, Congress passed and President Kennedy signed a joint resolution declaring May 15th as National Peace Officers Memorial Day to honor law enforcement officers killed or disabled in the line of duty. The resolution also created National Police Week as an annual tribute to law enforcement service and sacrifice.
For more information about other National Police Week events, please visit www.policeweek.org.
Two Local Inmates Indicted for Threatening Anthrax UseRead the Press Release
PENSACOLA, FLORIDA – Craig T. Pope, 29, and Justin B. Lane, 34, were arraigned on May 3 and today, respectively, in the U.S. District Court in Pensacola after a federal grand jury returned two separate indictments charging each of them with mailing threatening communications and threatened use of a weapon of mass destruction. The indictments were announced by Christopher P. Canova, United States Attorney for the Northern District of Florida.
According to Pope’s indictment, in April and May 2017, Pope mailed a letter to a judge threatening a bomb and an anthrax outbreak in the courthouse. According to Lane’s indictment, in August 2017, Lane mailed a letter to the Polk County State Attorney’s Office threatening to use anthrax.
Pope’s trial is scheduled for June 4 at 9:00 a.m., and Lane’s trial is scheduled for July 9 at 8:00 a.m.
If convicted of mailing threatening communications, Pope and Lane face a maximum of five years in prison. If convicted of threatened use of a weapon of mass destruction, the defendants face a maximum of life in prison.
These cases resulted from investigations by the Federal Bureau of Investigation, the Florida Department of Law Enforcement, the Hillsborough County Sheriff’s Office, and the Tampa Police Department. Assistant United States Attorney David L. Goldberg is prosecuting the cases.
An indictment is merely an allegation that a defendant has committed a violation of federal criminal law and is not evidence of guilt. All defendants are presumed innocent and entitled to a fair trial, during which it will be the government’s burden to prove guilt beyond a reasonable doubt at trial.
The United States Attorney's Office for the Northern District of Florida is one of 94 offices that serve as the nation’s principal litigators under the direction of the Attorney General. To access available public court documents online, please visit the U.S. District Court for the Northern District of Florida website. For more information about the United States Attorney’s Office, Northern District of Florida, visit http://www.justice.gov/usao/fln/index.html.
Two Brooklyn Men Convicted of Kidnapping and Torture of VictimRead the Press Release
Earlier today, following six days of trial, a federal jury in Brooklyn returned guilty verdicts against Michael Crumble and Ramell Markus on charges of kidnapping conspiracy, kidnapping and committing physical violence in furtherance of an extortion. The charges are contained in an indictment arising from an abduction, assault and extortion committed by the defendants on December 18, 2017. When sentenced by United States District Judge Allyne R. Ross, the defendants face a maximum of life imprisonment.
Richard P. Donoghue, United States Attorney for the Eastern District of New York, William F. Sweeney, Jr., Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), and James P. O’Neill, Commissioner, New York City Police Department (NYPD), announced the verdict.
“As the jury found, Crumble and Markus abducted the victim and took him to a location in Brooklyn that became a torture chamber, where he was beaten and burned with a hot iron in an attempt to extract drugs, money and information to settle a drug dispute,” stated United States Attorney Donoghue. “The defendants will now be held responsible for their ruthless conduct. I commend our partners in the New York City Safe Streets Task Force, which is comprised of agents of the FBI and detectives from the NYPD, for their outstanding investigative work.”
The evidence presented at trial established that Crumble, Markus, and a co-conspirator kidnapped the victim outside his home in Queens, forcing him into a vehicle. Markus pistol-whipped the victim, seeking a package of narcotics believed to be in his home. The defendants and the co-conspirator drove the victim to a residence in Brooklyn, and demanded that he give them narcotics, money, and the address of a location that the perpetrators believed contained additional money, as well as jewelry. To force the victim to comply, Markus broke a glass on his face, and the co-conspirator repeatedly burned both of the victim’s arms with a hot clothing iron. After the victim’s fiancée provided the defendants with money and drugs, the defendants and the co-conspirator transported the victim to a hotel in Brooklyn where he was held captive while the defendants waited for another individual to provide the address they were seeking. The defendants held the victim captive for more than eight hours.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local and tribal law enforcement and the local community to develop effective, locally based strategies to reduce violent crime.
The government’s case is being handled by the Office’s Organized Crime and Gangs Section. Assistant United States Attorneys Keith D. Edelman and Lindsay K. Gerdes are in charge of the prosecution.
The Defendants:
MICHAEL CRUMBLE
Age: 34
Residence: Brooklyn, New York,RAMELL MARKUS (also known as “Rah,” “Dollah” and “Smooth”)
Age: 35
Residence: Brooklyn, New YorkE.D.N.Y. Docket No. 18-CR-32 (ARR)
Toledo pastor Kenneth Butler pleads guilty to sex trafficking of minorsRead the Press Release
A Toledo pastor is likely to spend 17 ½ years in prison after pleading guilty to sex trafficking of minors.
Kenneth Butler, 38, pleaded guilty Monday to one count of conspiracy to sex traffic children, two counts of sex trafficking of children and one count of obstruction of a sex trafficking investigation.
Butler is scheduled to be sentenced in September. Under the terms of his plea agreement, both sides will ask for a sentence of 210 months in prison.
“This defendant has admitted to crimes that include preying on a foster child who was previously the victim of sexual abuse, and he committed these crimes in a house of worship,” U.S. Attorney Justin E. Herdman said. “Butler may hold himself out to the community as a pastor, but in the eyes of the law he is a criminal who pays money to sexually assault children.”
FBI Special Agent in Charge Stephen D. Anthony said: “The FBI is pleased that Kenneth Butler has acknowledged the criminal behavior he inflicted on a vulnerable minor. The FBI will continue efforts to identify and prosecute those that coerce and exploit our youth through sex trafficking.”
Two other pastors – Anthony Haynes and Cordell Jenkins – have been indicted for their roles in the sex trafficking conspiracy and are awaiting trial. Laura Lloyd Jenkins has been indicted for obstructing the investigation and is also awaiting trial.
According to Butler’s plea agreement:
Butler did knowingly recruit, entice, harbor, transport, provide, obtain, maintain, patronize, or solicit, by any means, Juvenile #1 and #2, knowing that such juveniles had not attained the age of 18 years and would be caused to engage in a commercial sex act. This took place between 2015 and March 2017.
Butler was a pastor of a church in Detroit from 2007 through 2012. Shortly after his church closed in 2013, Butler started attending church at the Greater Life Christian Center in Toledo. Anthony Haynes was the lead pastor of the church. Haynes and Butler quickly became friends and started spending time together at the church and elsewhere.
In 2014, Haynes told Butler Juvenile #1 moved into his home. Haynes informed Butler that Juvenile #1 was sexually abused when she was younger by her family members, and at least one of the family members was convicted of a crime for the conduct.
In late 2015, Haynes picked up Butler with Juvenile #1 already in the car. The three of them went to the Greater Life Christian Center to Haynes’s office. Juvenile #1 began to undress. Haynes looked at Butler and stated, “You owe me” and laughed.
Haynes and Butler performed oral sex on Juvenile #1 and then took turns having unprotected vaginal intercourse. While Butler was penetrating Juvenile #1, Juvenile #1 was performing oral sex on Haynes. Butler knew Juvenile #1 was under the age of 18 years. The next day, Haynes and Butler discussed the encounter and how it was fun.
In 2016, Haynes closed Greater Life Christian Center and opened a new church named University Bible Fellowship in Toledo. Shortly after this church opened, Haynes called Bulter and told him to meet Juvenile #1 and him at University Bible Fellowship. When Butler arrived, it was apparent they were going to have another threesome.
However, Haynes instructed Butler to give Juvenile #1 a ride to her job interview first. He drove Juvenile #1 to the interview and brought her back to the church. Once back at the church, Juvenile #1 performed oral sex on Haynes and Butler, and they took turns having unprotected vaginal intercourse with her.
After this encounter, Haynes told Butler that Cordell Jenkins also was having sex with Juvenile #1. Butler knew Jenkins as another pastor in the Toledo area. Butler went to Jenkins’s church on a few occasions when Haynes was a guest preacher. Likewise, Jenkins was a guest preacher at Haynes’s church.
Approximately one month later, Butler picked up Juvenile #1 from school and drove to a secluded area, where Butler had unprotected vaginal intercourse with her in the car.
Butler rented a motel room in Toledo a few weeks later. Juvenile #1 stated that Haynes was supposed to meet them, but he never showed up. Butler had unprotected vaginal intercourse with Juvenile #1.
Butler went to Juvenile #1’s residence in early 2017. On the way, he called and spoke with Haynes. Juvenile #1 asked for $30 for her hair, in which Butler replied, “You better be nice and naked.”
Butler had unprotected vaginal intercourse with Juvenile #1 at her residence. After the sex, he gave her $30.
In March 2017, Haynes informed Butler that there was a federal investigation into their conduct. Butler deleted text messages on his cellular telephone regarding his conversations with Juvenile #1.
Butler also had sex with another minor, Juvenile #2, who attend church at Greater Life Christian Center. The two met at the church in 2016. Shortly after meeting, Butler started his own church in the Detroit area.
Butler routinely took Juvenile #2 with him to his church in Michigan. Juvenile #2 watched Bulter’s children during the church service. In 2017, while driving back from his Detroit church, Butler pulled off the road and had vaginal intercourse with Juvenile #2. Butler knew Juvenile #2 had not attained the age of 18 years. Butler routinely provided Juvenile #2 rides to various places in the Toledo area, and on at least one occasion, gave her $20.
On October 4, 2017, Juvenile #2 called Butler. During the call, Butler told Juvenile #2 to lie to federal authorities when asked about their sex, according to court documents.
This case is being prosecuted by Assistant U.S. Attorneys Michael Freeman and Alissa Sterling following an investigation by the FBI’s Northwest Ohio Violent Crimes Against Children Task Force. The Task Force is comprised of members of the FBI, Toledo Police Department, Perrysburg Township Police Department, Lima Police Department, Oregon Police Department, Fulton County Sheriff’s Office, Ottawa County Sheriff’s Office, Ohio State Highway Patrol, the Bureau of Criminal Investigation and Lucas County Sheriff’s Office.
Three Romanian Nationals Sentenced for Racketeering Conspiracy and ATM SkimmingRead the Press Release
BOSTON – Three Romanian nationals were sentenced today in federal court in Boston in connection with an ATM skimming scheme operating throughout Massachusetts and other states including Connecticut, New Hampshire, New York and South Carolina.
Constantin Denis Hornea, 23, his wife Maria Lazar, 19, and his brother Ludemis Hornea, 21, were sentenced by U.S. District Court Judge William G. Young. Judge Young sentenced Constantin Hornea to 65 months in prison, three years of supervised release and ordered him to pay $242,141 in restitution and a money judgment of $54,260; Lazar was sentenced to 27 months in prison, three years of supervised release and ordered to pay $95,902 in restitution and a money judgment of $28,170; and Ludemis Hornea was sentenced to 42 months in prison, which includes credit for 15 months served on a state sentence, three years of supervised release and ordered him to pay $57,422 in restitution and a money judgment of $11,124.
In December 2017, the Hornea brothers and Lazar pleaded guilty to conspiracy to conduct enterprise affairs through a pattern of racketeering activity, more commonly known as RICO conspiracy, conspiracy to use counterfeit access devices, money laundering conspiracy and aggravated identity theft. The Hornea brothers also pleaded guilty to possession of device making equipment. In May 2017, the Hornea brothers, Lazar and 11 co-conspirators were indicted in connection with the scheme. In March 2018, co-conspirators Denisa Bonculescu, Anamaria Margel and Ion Trifu were sentenced. Claudio Cosmin Florea and Nicusor Bonculescu are pending sentencing; Ion Bonculescu is in extradition proceedings in Germany; Ion Vaduva is in extradition proceedings in Hungary; and Florinel Vaduva and Florin Hornea are pending trial scheduled for Nov. 5, 2018. The whereabouts of Dragush Nelo Hornea and Nemanja Milosavljevic remain unknown.
The defendants, except for Trifu, were members of the Hornea Crew (“Crew”), led by Constantin Denis Hornea and Ludemis Hornea, and engaged in ATM skimming – obtaining debit card numbers and PINs from unsuspecting bank customers, creating counterfeit cards, and making unauthorized withdrawals from the victims’ bank accounts. Over a period of 18 months, the Crew installed skimming devices and made unauthorized withdrawals from ATMs in various town in seven states: Massachusetts, New Hampshire, Connecticut, New York, South Carolina, North Carolina and Georgia.
Members of the Hornea Crew and Trifu transferred money throughout the United States and to Romania and the People’s Republic of China. Some of those transfers were for the purchase of skimming devices and related components from abroad.
United States Attorney Andrew Lelling; Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and Colonel Kerry A. Gilpin, Superintendent of the Massachusetts State Police, made the announcement today. Assistance with the investigation was also provided by the Internal Revenue Service’s Criminal Investigations in Boston; U.S. Customs and Border Protection; U.S. Secret Service; U.S. Postal Service; Massachusetts Department of Correction; Connecticut State Police; the Amherst, Billerica, Braintree, Boston, Florence (S.C.); Greenwich (Conn.), Houston (Texas) New York City (N.Y.), Quincy, Saluda (S.C.), Southwick, Waltham, Whately, and Westwood Police Departments; South Carolina Law Enforcement Division; Richland County (S.C.) Sheriff’s Department; and the Solicitor’s Offices of Greenville and Saluda Counties. Assistant U.S. Attorney Timothy E. Moran of Lelling’s Organized Crime and Gang Unit is prosecuting the case.
The details contained in the charging document are allegations. The remaining defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
Temple Hills Man Sentenced to over Nine Years in Prison for Commercial RobberyRead the Press Release
FOR IMMEDIATE RELEASE Contact ELIZABETH MORSE
www.justice.gov/usao/md at (410) 209-4885
Greenbelt, Maryland – On May 11, 2018, United States District Judge George J. Hazel sentenced Percy Raymond Jones, age 27, of Temple Hills, Maryland today to nine and a half years in prison, followed by three years of supervised release, for Interference with Interstate Commerce by Robbery and Using, Carrying, and Brandishing a Firearm During and in Relation to a Crime of Violence.
The sentence was announced by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge Gordon B. Johnson of the Federal Bureau of Investigation, Baltimore Field Office; and Chief Henry P. Stawinski III of the Prince George’s County Police Department.
According to his plea agreement, on December 6, 2016, Jones and his co-conspirator, Javonte Jaquan Moore, age 23, of Upper Marlboro, Maryland robbed a business in District Heights, Maryland.
During the course of the robbery, Moore grabbed Victim 1, placed a 9 mm semi-automatic handgun to her head and back, and demanded that she open the cash register. Meanwhile, Jones took Victim 2 to the rear of the store where Victim 3, another employee, was stocking merchandise. Both Victim 2 and Victim 3 were forced to lie on the ground while Jones began filling duffel bags with video games. Moore then entered the rear of the store and began assisting Jones. Both Moore and Jones then fled out of the front door of the store with approximately four Sony PlayStation 4 gaming systems, approximately 46 assorted video games, and cash.
Shastri Gill, age 24, of Washington D.C. drove the getaway car, after previously entering the business and informing Jones of who was present.
During the robbery, Jones and Moore unwittingly took two GPS tracking devices. The GPS tracking devices led officers to an apartment building located on Alpine Street in District Heights, Maryland, where they were arrested.
Moore previously was sentenced to 114 months in prison, followed by three years of supervised release. Gill was sentenced to 41 months in prison, followed by three years of supervised release.
United States Attorney Robert K. Hur praised the FBI Cross Border Task Force and the Prince George’s County Police Department for their work in the investigation. Mr. Hur thanked Assistant U.S. Attorney Ray D. McKenzie, who prosecuted the case.
Taylor County man admits to drug chargeRead the Press Release
CLARKSBURG, WEST VIRGINIA – Alexander D. Barnett, of Flemington, West Virginia, has admitted to a drug distribution charge, United States Attorney Bill Powell announced.
Barnett, age 23, pled guilty to one count of “Aiding and Abetting the Distribution of Heroin.” Barnett admitted to selling heroin in March 2016 in Harrison County.
Barnett faces up to 20 years incarceration and a fine of up to $1,000,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Traci M. Cook is prosecuting the case on behalf of the government. The Greater Harrison Drug and Violent Crimes Task Force, a HIDTA-funded initiative, investigated.
U.S. Magistrate Judge Michael John Aloi presided.
Tahlequah Man Sentenced to 18 Months, $266,000 Restitution for Concealment of Material FactRead the Press Release
MUSKOGEE, OKLAHOMA – The United States Attorney’s Office for the Eastern District of Oklahoma announced that James Michael West, age 64, of Tahlequah, Oklahoma was sentenced to 18 months imprisonment, and 3 years supervised release for Concealment Of A Material Fact, in violation of Title 42, United States Code, Section 408(a)(4). The charge arose from an investigation by the Social Security Administration’s Office of Inspector General. West has been ordered to pay restitution in the amount of $266,982.00.
The Indictment alleged that from on or about July 14, 2005, and continuing through December 31, 2016, in the Eastern District of Oklahoma and elsewhere, defendant James Michael West, in a matter within the jurisdiction of Social Security Administration, having knowledge of the occurrence of an event affecting the right to receive or continue to receive Social Security Disability Income payments, concealed and failed to disclose such event with the intent to fraudulently secure payment when no payment was authorized. Specifically, defendant James Michael West intentionally concealed that James Michael West secured gainful employment in order to receive and continue to receive Disability Income payments made by the Social Security Administration to him. By such action, defendant James Michael West took approximately $266,982.00 in Social Security Disability Income payments to which he was not entitled.
“When someone unlawfully receives income from the Social Security Administration (“SSA”) it is a theft from all who are or will someday be lawfully entitled to receive income from the SSA. Investigations and prosecutions of those that fraudulently receive Social Security Income are vital to the continued stability of the entire program,” said United States Attorney Brian J. Kuester. “I commend the SSA-OIG for its thorough, professional investigation and the members of this office who prosecuted and assisted with the prosecution of this case.”
The Honorable Ronald A. White, U.S. District Judge in the United States District Court for the Eastern District of Oklahoma, in Muskogee, presided over the hearing. Assistant United States Attorney Rob Wallace represented the United States. The defendant will report to the designated federal facility at which the non-paroleable sentence will be served.
Steubenville, Ohio man sentenced to more than six years for firearm chargeRead the Press Release
WHEELING, WEST VIRGINIA – Thomas Bennett, of Steubenville, Ohio, was sentenced today to 76 months incarceration for unlawful possession of a firearm, United States Attorney Bill Powell announced.
Bennett, age 42, pled guilty to one count of “Unlawful Possession of a Firearm” in May of 2018. Bennett, having previously been convicted of drug possession in Commons Pleas Court in Jefferson County, Ohio in 2017, admitted to possessing a 9mm pistol in Ohio County on August 12, 2017.
Assistant U.S. Attorney Stephen L. Vogrin prosecuted the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives and the Wheeling Police Department investigated.
Senior U.S. District Judge Frederick P. Stamp, Jr. presided.
South Texas Doctor Charged with $240 Million Health Care fraud and International Money Laundering SchemeRead the Press Release
McALLEN, Texas – A physician based in the McAllen area was charged in an indictment unsealed today for his role in a $240 million health care fraud and international money laundering scheme.
Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, U.S. Attorney Ryan J. Patrick, Special Agent in Charge C.J. Porter of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Dallas Region and Special Agent in Charge Christopher Combs of the FBI’s San Antonio Field Office made the announcement.
Jorge Zamora-Quezada, 61, of Mission, was charged in a seven-count indictment filed in the Southern District of Texas. He was charged with one count of conspiracy to commit health care fraud, five counts of health care fraud and one count of conspiracy to commit money laundering. Zamora-Quezada had his initial court appearance earlier today. His detention hearing is set for tomorrow, May 15, at 2 p.m. before U.S. Magistrate Judge Peter E. Ormsby.
“Jorge Zamora-Quezada allegedly orchestrated a massive fraud scheme that jeopardized the health and wellbeing of innocent children, elderly and disabled victims,” said Cronan. “The allegations that Zamora-Quezada violated his oath to do no harm by administering unnecessary chemotherapy and other toxic medications to patients with serious diseases — including some of the most vulnerable victims imaginable — are almost beyond comprehension. The Criminal Division is committed to combatting health care fraud and protecting victims of reprehensible schemes like the one alleged in this case.”
“We take allegations of this nature very seriously,” said Patrick. “The prosecution of health care fraud is a high priority for the Southern District of Texas, especially when we suspect vulnerable patients have been allegedly exploited, misdiagnosed or possibly given potentially harmful medications as a means of committing that fraud.”
“Today’s indictment is the first step in holding Dr. Zamora-Quezada accountable for his allegedly egregious criminal conduct,” said Porter. “His patients trusted him and presumed his integrity; in return he allegedly engaged in a scheme of false diagnoses and bogus courses of treatment and doled out prescriptions for unnecessary and harmful medications, all for his personal financial gain and with no regard for patient well-being. HHS-OIG will always pursue criminals masquerading as legitimate physicians, weed them out and seek the harshest possible punishment, particularly when patient harm is a factor.”
“The FBI is dedicated to working with our task force partners to address health care fraud, which is a growing and serious crime that impacts every city and small town in the nation,” said Combs. “This investigation highlights an even greater concern presented by health care fraud than the significant financial losses—the physical and emotional harm suffered by the patients and their families. It is why we at the FBI, together with our task force partners, are dedicated to seeking justice for the victims of Dr. Zamora-Quezada’s alleged crimes.”
As set forth in the indictment, from 2000 through the filing of the indictment, Zamora-Quezada and his co-conspirators falsely diagnosed vulnerable patients -- including the young, elderly and disabled, from the Rio Grande Valley, San Antonio and elsewhere -- with various degenerative diseases, including rheumatoid arthritis. He and his co-conspirators then administered chemotherapy and other toxic medications to the patients based on that false diagnosis. In addition to falsely diagnosing patients, Zamora-Quezada and his co-conspirators allegedly conducted a battery of fraudulent, repetitive and excessive medical procedures on patients in order to increase revenue and fund Zamora-Quezada’s lavish and opulent lifestyle.
The indictment alleges Zamora-Quezada and his co-conspirators flew in Zamora-Quezada’s million-dollar private jet or drove in his Maserati, which were both emblazoned with his initials “ZQ” between his offices in the Rio Grande Valley and San Antonio in order to perpetuate the fraud. He and his co-conspirators transferred the proceeds derived from the conspiracy to purchase private jets, luxury vehicles, clothing from high-end retailers such as Louis Vuitton and exclusive real estate located throughout the United States and Mexico. He and his co-conspirators allegedly obstructed investigations by causing the creation of false and fictitious patient records and concealed thousands of medical records from Medicare by stashing them in an unsecured and dilapidated barn located in the Rio Grande Valley.
The indictment also alleges Zamora-Quezada and his co-conspirators laundered the proceeds of their fraud scheme by dissipating, transforming and concealing the source and location of the fraud proceeds by investing such proceeds in commercial and residential real estate in the United States and Mexico. Among other properties, he and his co-conspirators acquired two penthouses in Puerto Vallarta, Mexico; a condominium in Aspen, Colorado; a condominium in Punta Mita, Mexico; and multiple homes and commercial properties located throughout Texas. He then created the false appearance of legitimate wealth and income by renting the various commercial and residential properties that he acquired to individuals and entities. Zamora-Quezada and his co-conspirators allegedly laundered the proceeds through a casa de cambio, or money exchange house, to various accounts maintained by financial institutions in Mexico.
The indictment seeks the forfeiture of Zamora-Quezada’s personal jet, Maserati and multiple residential and commercial properties in the United States and Mexico.
The case is being investigated by the HHS-OIG’s McAllen Field Office, FBI’s San Antonio Division-McAllen Resident Agency’s Rio Grande Valley Health Care Fraud Task Force and the McAllen Complex Financial Crimes Task Force. These task forces are comprised of investigators from Texas Department of Insurance, police departments in McAllen and Pharr and the Texas Health and Human Service Commission. Trial Attorney Kevin Lowell of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Andrew Swartz of the Southern District of Texas are prosecuting the case.
The FBI is seeking to identify potential victims of Zamora-Quezada and his co-conspirators. If you were a patient of Zamora-Quezada from January 2000 through May 2018 and believe you may have been affected by his or his co-conspirators alleged crimes, please contact the FBI via the FBI victim’s hotline, 1-833-432-4873, Option 8, or if you have access to email you may email the taskforce at [email protected]. The FBI is legally mandated to identify victims of federal crimes that it investigates and provide these victims with information, assistance services and resources.
The Fraud Section leads the Medicare Fraud Strike Force, which is part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations nationwide. Since its inception in March 2007, the Medicare Fraud Strike Force has charged more than 3,500 defendants who collectively have falsely billed the Medicare program for over $12.5 billion.
An indictment is a formal accusation of criminal conduct, not evidence.
A defendant is presumed innocent unless convicted through due process of law.
South Texas Doctor Charged with $240 Million Health Care Fraud and International Money Laundering SchemeRead the Press Release
A physician based in the McAllen, Texas area was charged in an indictment unsealed today for his role in a $240 million health care fraud and international money laundering scheme.
Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division, U.S. Attorney Ryan J. Patrick of the Southern District of Texas, Special Agent in Charge C.J. Porter of the U.S. Department of Health and Human Services Office of Inspector General’s (HHS-OIG) Dallas Region and Special Agent in Charge Christopher Combs of the FBI’s San Antonio Field Office made the announcement.
Jorge Zamora-Quezada, 61, of Mission, Texas, was charged in a seven-count indictment filed in the Southern District of Texas. He was charged with one count of conspiracy to commit health care fraud, five counts of health care fraud and one count of conspiracy to commit money laundering. Zamora-Quezada had his initial court appearance earlier today. His detention hearing is tomorrow, May 15, at 2 p.m. CDT before U.S. Magistrate Judge Peter E. Ormsby in the McAllen Division of the Southern District of Texas.
“Jorge Zamora-Quezada allegedly orchestrated a massive fraud scheme that jeopardized the health and wellbeing of innocent children, elderly, and disabled victims,” said Acting Assistant Attorney General Cronan. “The allegations that Zamora-Quezada violated his oath to do no harm by administering unnecessary chemotherapy and other toxic medications to patients with serious diseases — including some of the most vulnerable victims imaginable — are almost beyond comprehension. The Criminal Division is committed to combatting health care fraud and protecting victims of reprehensible schemes like the one alleged in this case.”
“We take allegations of this nature very seriously,” said U.S. Attorney Patrick. “The prosecution of health care fraud is a high priority for the Southern District of Texas, especially when we suspect vulnerable patients have been allegedly exploited, misdiagnosed or possibly given potentially harmful medications as a means of committing that fraud.”
“Today’s indictment is the first step in holding Dr. Zamora-Quezada accountable for his allegedly egregious criminal conduct,” said HHS-OIG Special Agent in Charge Porter. “His patients trusted him and presumed his integrity; in return he allegedly engaged in a scheme of false diagnoses and bogus courses of treatment, and doled out prescriptions for unnecessary and harmful medications, all for his personal financial gain and with no regard for patient well-being. HHS-OIG will always pursue criminals masquerading as legitimate physicians, weed them out, and seek the harshest possible punishment, particularly when patient harm is a factor.”
“The FBI is dedicated to working with our task force partners to address health care fraud, which is a growing and serious crime that impacts every city and small town in the nation,” said FBI Special Agent in Charge Combs. “This investigation highlights an even greater concern presented by health care fraud than the significant financial losses—the physical and emotional harm suffered by the patients and their families. It is why we at the FBI, together with our task force partners, are dedicated to seeking justice for the victims of Dr. Zamora-Quezada’s alleged crimes.”
As set forth in the indictment, from 2000 through the filing of the indictment, Zamora-Quezada and his co-conspirators falsely diagnosed vulnerable patients -- including the young, elderly and disabled, from the Rio Grande Valley, San Antonio, and elsewhere -- with various degenerative diseases, including rheumatoid arthritis. He and his co-conspirators then administered chemotherapy and other toxic medications to the patients based on that false diagnosis. In addition to falsely diagnosing patients, Zamora-Quezada and his co-conspirators allegedly conducted a battery of fraudulent, repetitive, and excessive medical procedures on patients in order to increase revenue and fund Zamora-Quezada’s lavish and opulent lifestyle.
The indictment alleges that Zamora-Quezada and his co-conspirators flew in Zamora-Quezada’s million-dollar private jet or drove in his Maserati, which were both emblazoned with his initials, “ZQ,” between his offices in the Rio Grande Valley and San Antonio in order to perpetuate the fraud. He and his co-conspirators transferred the proceeds derived from the conspiracy to purchase private jets, luxury vehicles, clothing from high-end retailers such as Louis Vuitton, and exclusive real estate located throughout the United States and Mexico. He and his co-conspirators allegedly obstructed investigations by causing the creation of false and fictitious patient records, and concealed thousands of medical records from Medicare by stashing them in an unsecured and dilapidated barn located in the Rio Grande Valley.
The indictment also alleges that Zamora-Quezada and his co-conspirators laundered the proceeds of their fraud scheme by dissipating, transforming and concealing the source and location of the fraud proceeds by investing such proceeds in commercial and residential real estate in the United States and Mexico. Among other properties, he and his co-conspirators acquired two penthouses in Puerto Vallarta, Mexico; a condominium in Aspen, Colorado; a condominium in Punta Mita, Mexico; and multiple homes and commercial properties located throughout Texas. He then created the false appearance of legitimate wealth and income by renting the various commercial and residential properties that he acquired to individuals and entities. Zamora-Quezada and his co-conspirators allegedly laundered the proceeds through a casa de cambio, or money exchange house, to various accounts maintained by financial institutions in Mexico.
The indictment seeks the forfeiture of Zamora-Quezada’s personal jet, Maserati and multiple residential and commercial properties in the United States and Mexico.
An indictment is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.
The case is being investigated by the HHS-OIG’s McAllen Field Office, the FBI’s San Antonio Division-McAllen Resident Agency’s Rio Grande Valley Health Care Fraud Task Force and the McAllen Complex Financial Crimes Task Force. These task forces are comprised of investigators from Texas Department of Insurance, McAllen Police Department, Pharr Police Department and the Texas Health and Human Service Commission. Trial Attorney Kevin Lowell of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Andrew Swartz of the Southern District of Texas are prosecuting the case.
The FBI is seeking to identify potential victims of Zamora-Quezada and his co-conspirators. If you were a patient of Zamora-Quezada from January 2000 through May 2018 and believe you may have been affected by his or his co-conspirators alleged crimes, please contact the FBI via the FBI victim’s hotline, 1-833-432-4873, Option 8, or if you have access to email you may email the taskforce at [email protected]. The FBI is legally mandated to identify victims of federal crimes that it investigates and provide these victims with information, assistance services, and resources.
The Fraud Section leads the Medicare Fraud Strike Force, which is part of a joint initiative between the Department of Justice and HHS to focus their efforts to prevent and deter fraud and enforce current anti-fraud laws around the country. The Medicare Fraud Strike Force operates in nine locations nationwide. Since its inception in March 2007, the Medicare Fraud Strike Force has charged over 3,500 defendants who collectively have falsely billed the Medicare program for over $12.5 billion.
Sacaton Man Sentenced to over 22 Years for MurderRead the Press Release
PHOENIX – On May 14, 2017, Robert Wayne Long, 24, of Sacaton, Ariz., a member of the Gila River Indian Community, was sentenced by U.S. District Douglas L. Rayes to over 22 years in prison. Long had previously pleaded guilty to second degree murder. At the time of the offense, Long was on Federal Supervised Release for assault resulting in serious bodily injury.
The investigation in this case was conducted by the Gila River Police Department. The prosecution was handled by Raynette Logan, Assistant U.S. Attorney, District of Arizona, Phoenix.
CASE NUMBER: CR-17-487-PHX-DLR
RELEASE NUMBER: 2018-064_Long
# # #
For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Repeat Investment Fraudster Sentenced to 8 Years in Prison for Wire Fraud, Securities Fraud and Aggravated Identity TheftRead the Press Release
A 48-year old Renton man who falsely presented himself as a legitimate investment advisor was sentenced today in U.S. District Court in Seattle to eight years in prison for eight federal felonies, announced U.S. Attorney Annette L. Hayes. RICHARD THOMAS ZIESKE was previously convicted of federal fraud charges for defrauding members of his church and others out of over $1.2 million by posing as an investment advisor. Last February ZIESKE was convicted of a similar scheme to defraud victims he met through a Renton martial arts studio. At sentencing, U.S. District Judge James L. Robart said ZIESKE has no respect for the law. “We’re talking about someone who is a serial predator in the financial markets,” the judge said. Turning to ZIESKE he added, “You take people you know and who try to help you, and then you use them in your scheme.”
ZIESKE was convicted of five counts of wire fraud, one count of securities fraud and two counts of aggravated identity theft. According to records filed in the case and testimony at trial, in 2013, ZIESKE overheard a member of his Renton martial arts studio talking about his 401k account. The victim had been forced to retire and limit his martial arts due to a degenerative neck condition. ZIESKE convinced the victim to allow him to manage more than $95,000 in retirement funds, promising big returns. Instead, ZIESKE used the money to purchase a limited edition Harley Davidson motorcycle, pay for liposuction surgery, and finance a luxury SUV. ZIESKE attempted to recruit other ‘investors,’ and convinced the founder of the martial arts studio to invest $50,000 with him.
In 2005, ZIESKE pleaded guilty to mail fraud, securities fraud and wire fraud for a scheme in which he solicited nearly $2 million from members of his church and others, fraudulently promising big returns on investments. ZIESKE was sentenced to 41 months in prison and ordered to pay more than $1.3 million in restitution. The Washington Department of Financial Institutions also entered a cease and desist order against him. The prior conduct caused a brokerage firm to close ZIESKE’s trading account during the more recent scheme after its check revealed ZIESKE’s previous conviction. ZIESKE then opened another brokerage account using the identity of another member of the martial arts studio.
Prosecutors asked that ZIESKE be ordered to pay $84,915 to his victims. Judge Robart will set the restitution amount at a later date. He ordered ZIESKE to be subject to federal supervision for three years following his prison term.
The case was investigated by the FBI. The case was prosecuted by Assistant United States Attorneys Seth Wilkinson and Michael Dion.
Recognition of Law Enforcement Service and Sacrifice During National Police WeekRead the Press Release
May 14, 2018 – United States Attorney General Sessions, together with Joseph H. Harrington, United States Attorney for the Eastern District of Washington, recognized the service and sacrifice of federal, state, local, and tribal police officers on the occasion of National Police Week, and commented on the FBI's 2017 Law Enforcement Officers Killed and Assaulted report.
In October 1962, Congress passed and President Kennedy signed a joint resolution declaring May 15th as National Peace Officers Memorial Day to honor law enforcement officers killed or disabled in the line of duty. The resolution also created National Police Week as an annual tribute to law enforcement service and sacrifice. During Police Week, which is observed from Sunday, May 13 to Saturday, May 19, 2018, our nation celebrates the contributions of police officers from around the country, recognizing their hard work, dedication, loyalty and commitment in keeping our communities safe.
“One officer death is too many,” U.S. Attorney General Sessions said. “While we are inexpressibly grateful to have had a decrease in the number of officers killed in the line-of-duty last year, the number is still far too high. At the Department of Justice, we honor the memories of the fallen and we pray for their families. We are also following President Trump's Executive Orders to back the women and men in blue, to enhance law enforcement safety, and to reduce violent crime in America. Those priorities will help keep every American safe, including those who risk their lives for us. As always, we have their backs and they have our thanks.”
United States Attorney Harrington said “National Police Week is an opportunity to reinforce our strong commitment to law enforcement both here in the State of Washington and across the country. Every day our law enforcement officers carry out their sworn duties, risk is a constant companion. It is a privilege to honor these men and women who patrol our streets, guard our communities, and keep us safe from harm.”
Spokane will be hosting two events to honor law enforcement officers in the State of Washington who were killed or died in the line of duty next week:
- 5th Annual Candlelight Ceremony, Monday, May 14th at 7:30 p.m. at the Memorial, 1100 W. Mallon; and
- 31st Annual Law Enforcement Officers Memorial Ceremony, Tuesday May 15th at 11:30 a.m. at 1100 W. Mallon.
According to statistics collected by the FBI, 93 law enforcement officers were killed in line-of-duty incidents in 2017 – a 21 percent decrease from 2016 when 118 law enforcement officers were killed in line-of-duty incidents. Additionally, in 2017 there were 46 law enforcement officers killed in line-of-duty incidents as a result of felonious acts – this is a 30 percent decrease from 2016, when 66 law enforcement officer were killed in line-of-duty incidents as a result of felonious acts. For the full comprehensive data tables about these incidents and brief narratives describing the fatal attacks and selected assaults resulting in injury, please see the 2017 edition of Law Enforcement Officers Killed and Assaulted report, released today.
The names of all 93 fallen officers nationwide were formally dedicated on the National Law Enforcement Officers Memorial in Washington, DC, during the 30th Annual Candlelight Vigil on the evening of May 13, 2018. So that people across the country could experience this unique and powerful ceremony, the vigil was livestreamed. The Candlelight Vigil is one of many commemorative events taking place in the nation’s capital during National Police Week 2018.
For more information about other National Police Week events, please visit www.policeweek.org. To access the FBI's 2017 Law Enforcement Officers Killed and Assaulted report, please visit www.fbi.gov.
Randolph County Resident Charged with Firearm OffenseRead the Press Release
On May 8, 2018, Aaron L. Butler, of Steeleville, Illinois, was charged by indictment with Unlawful Possession of a Firearm by a Convicted Felon, United States Attorney for the Southern District of Illinois, Donald S. Boyce, announced today. The indictment alleges that the offense occurred on March 13, 2018, in Perry County. On May 9, 2018, Butler made his initial appearance in federal court. At a May 14, 2018, detention hearing, he was ordered held without bond pending a trial by jury, which is currently scheduled for July 9, 2018.
Under the law, a defendant is presumed to be innocent of a charge until proved guilty beyond a reasonable doubt to the satisfaction of a jury.
If convicted of the firearm violation, Butler faces a term of imprisonment of up to 10 years.
The ongoing investigation is being conducted by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Perry County Sheriff’s Office.
Psychiatrist Admits Signing Phony Medical Records to Deceive State InspectorsRead the Press Release
CAMDEN, N.J. – The psychiatrist of a nonprofit mental health services provider for Camden’s poorest residents today admitted signing fraudulent treatment plans meant to mislead New Jersey Medicaid inspectors, U.S. Attorney Craig Carpenito announced.
Lyda Monte, 78, of Bellmawr, New Jersey, pleaded guilty before U.S. District Judge Noel L. Hillman in Camden federal court to an information charging her with making false statements to a health care benefit program.
According to documents filed in this case and statements made in court: Monte was a psychiatrist at Nueva Vida Behavioral Health Center of New Jersey, a nonprofit provider of mental health services to the Camden Hispanic community. Most of Nueva Vida’s patients were Medicaid beneficiaries and the center was periodically inspected and audited by New Jersey Medicaid authorities.
Between January 2010 and August 2016, Cesar Tavera, the Executive Director of Nueva Vida, directed Nueva Vida therapists to prepare false treatment plans, including plans reflecting treatment that was not actually performed on patients, in order to mislead New Jersey Medicaid inspectors. Tavera then directed Monte to sign these fabricated treatment plans. Monte admitted today that she signed the treatment plans knowing that they were fraudulent and that they were intended to mislead New Jersey Medicaid inspectors.
Monte faces a maximum penalty of five years in prison and a $250,000 fine, or twice the gain or loss caused by the offense. Sentencing is scheduled for Aug. 28, 2018.
Cesar Tavera previously pleaded guilty to defrauding New Jersey Medicaid out of $2.5 million and embezzling more than $1.5 million from Nueva Vida. He was sentenced to 70 months in prison. Maria Tavera, a Nueva Vida administrator, pleaded guilty to embezzling from Nueva Vida and was sentenced to six months of home detention and three years of probation. Andres Ayala, a Nueva Vida therapist, previously pleaded guilty to conspiracy to commit health care fraud and awaits sentencing.
U.S. Attorney Carpenito credited agents of the FBI’s South Jersey Resident Agency, under the direction of Special Agent in Charge Michael Harpster in Philadelphia, and special agents from the Department of Health and Human Services, Office of Inspector General, under the direction of Special Agent in Charge Scott J. Lampert, with the investigation. He also thanked the Medicaid Fraud Division of the New Jersey Office of the State Comptroller.The government is represented by Assistant U.S. Attorney R. David Walk Jr. of the U.S. Attorney’s Office Health Care and Government Fraud Unit in Camden.
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Defense counsel: Rocco C. Cipparone Jr. Esq., Haddon Heights, New Jersey
Project Safe Neighborhood ProsecutionsRead the Press Release
HUNTINGTON, W.Va. – Consistent with United States Attorney Mike Stuart’s priority on the prosecution of felon in possession cases as part of our strategy to reduce violent crime throughout the Southern District of West Virginia, the following hearings took place before United StatesDistrict Judge Robert C. Chambers today. Assistant United States Attorney Stephanie Taylor is handling the prosecutions.
“We are aggressively prosecuting felons in possession and turning a number of cases around in short order,” said United States Attorney Mike Stuart. “The message is clear for felons, if you possess a firearm, you will go to prison.”
These cases are part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
GEORGIA MAN SENTENCED TO MORE THAN 9 YEARS IN PRISON FOR FIREARM CHARGE
A Georgia man was sentenced to 110 months – more than 9 years -- in federal prison for possessing a firearm, announced United States Attorney Mike Stuart. John Weathers, 32, previously pled guilty to being a felon in possession of a firearm. Stuart commended the investigation conducted by DEA and the West Virginia State Police.
On December 5, 2017, officers with the DEA and West Virginia State Police Violent Crime and Drug Task Force conducted a controlled buy of methamphetamine from Weathers. After determining Weathers was staying in Room 222 at the Econo Lodge in Huntington, officers obtained a search warrant. During the search, officers located a STAR Firestar 9mm pistol in a bag on the floor of the room. Weathers was prohibited from possessing any firearms under federal law because of a 2012 federal drug conviction in the Southern District of West Virginia.
MASON COUNTY FELON PLEAS GUILTY TO FEDERAL GUN CRIME
A Mason County, West Virginia felon who possessed a firearm in March 2017, pled guilty today to being a felon in possession of a firearm, announced United States Attorney Mike Stuart. James S. Potter, II, 38, admitted that on March 29, 2017, he possessed a firearm while being on home confinement in Mason County. Potter was prohibited from possessing any firearm under federal law because of multiple felony convictions. Stuart praised the efforts of the Alcohol, Tobacco, Firearms and Explosives (ATF) and the Mason County Sheriff’s Department.
Potter faces up to 10 years in prison when he is sentenced on August 6, 2018.
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Parking Lot Operator Agrees to Plead Guilty in Scheme to Pay Bribes and Defraud the Department of Veteran’s Affairs out of $13+ MillionRead the Press Release
LOS ANGELES – The owner of a business that operated parking lots has agreed to plead guilty in a 15-year bribery scheme that allowed him to defraud the U.S. Department of Veteran’s Affairs out of more than $13 million that should have been paid in relation to the operation of parking facilities on the VA’s Los Angeles medical campuses.
In a plea agreement filed today in United States District Court, David Richard Scott, 58, the owner of Westside Services LLC (WSS), agreed to plead guilty to conspiracy and wire fraud.
Scott, who has been in custody since his arrest in November, is expected to appear in court on Thursday to formally enter his guilty pleas.
The scheme, which resulted in the payment of nearly $300,000 in bribes to VA contracting officer Ralph Tillman, cost the VA more than $13 million it should have received under a contract with WSS to operate parking lots on the campuses of the VA Greater Los Angeles Healthcare System (VA GLAHS). The vast majority of the activity authorized under the contract took place at the West Los Angeles VA Medical Center near Westwood and included parking for UCLA baseball games, the Wadsworth and Brentwood theaters, and the PGA golf tournament at the Riviera Country Club.
For approximately 18 years, Scott had a contract to operate parking lots at VA GLAHS that required him to pay 60 percent of the gross revenues from the parking lots. Scott was required to submit annual reports detailing revenue generated by parking fees, as well as improvements and services his company provided that could be used to offset payments due to the VA.
Scott maintained at least two sets of financial books, according to the plea agreement filed today. The numbers reported to the VA contained false revenue and expense statements, while a second set of books maintained by Scott’s bookkeeper/tax preparer contained the actual revenues and expenditures, except for unreported cash.
Scott “intentionally failed to satisfy obligations and services placed upon him by the contract, and intentionally underreported revenue and inflated expenses so that it would appear that the VA owed WSS significant payment,” according to the plea agreement. Scott’s “goal was to pay the VA as little as possible.”
As part of the scheme to defraud the VA, Scott began bribing Tillman in 2003 and continued to bribe him on a regular basis until Tillman abruptly retired in 2014 after he was confronted by federal agents. Scott continued making “hush money” payments to Tillman after his retirement to continue the scheme and attempt to avoid termination of his parking contract. Scott used cash collected at the parking lots – cash revenue he rarely reported to the VA – to pay Tillman at least $286,000 in bribes.
“This bribery and fraud scheme directly harmed our nation’s veterans by depriving them of revenues that could have been used to provide important services and medical care to the brave men and women who served in our armed forces,” said United States Attorney Nicola T. Hanna. “The bribery payments to a public official are disturbing because they compromised our trust in government, allowed the scheme to operate for years and led to this defendant pocketing millions of dollars that should have gone to the Department of Veteran’s Affairs.”
Over the course of the scheme, Scott underreported at least $4.6 million in revenues and failed to report an unknown amount of cash collected at the parking lots, according to the plea agreement. Additionally, Scott avoided making payments to the VA by marking up expenses associated with the parking lots – in some cases, up to 600 percent – and claiming to have spent $11.6 million to improve and maintain the facilities. For example, Scott told the VA he spent nearly $5.97 million on repairs and maintenance, while his bookkeeper’s records showed he spent only $1.4 million for paving, fencing and other services associated with the parking lots.
“Between 2003 and 2016, defendant Scott utilized WSS business bank accounts to pay for approximately $740,000 in travel, $413,000 in meals and entertainment, defendant Scott’s salary of $3.1 million, and countless personal expenses and owner’s draws totaling at least $13.9 million,” according to the plea agreement. While Scott installed signs at one parking lot claiming that “proceeds go toward helping veterans in need,” Scott admitted in the plea agreement that the money generated at this lot funded his lavish lifestyle and the bribe payments.
As a result of the long-running scheme to defraud the VA, Scott amassed considerable wealth, including three condominiums in Santa Monica, with a cumulative estimated value of $7 million; numerous high-end collectible cars, including several classic Corvettes and three Ferrari automobiles; a Cigarette “Top Gun” racing boat; and bank and brokerage accounts contained more than $1 million. When he was arrested, authorities seized more than $213,000 from Scott’s residence – cash that had been skimmed from the VA parking lots.
As part of his plea agreement, Scott and his wife have agreed to forfeit all of these assets. Scott has agreed to pay approximately $12,619,693 in restitution, a figure that takes into account some money already repaid to the VA.
The plea agreement calls for Scott to serve a sentence of 70 months in federal prison. The final decision on the appropriate sentence will rest with United States District Judge R. Gary Klausner. If Judge Klausner decides to impose another sentence, either party has the option of withdrawing from the plea agreement.
Tillman, who cooperated in the federal investigation, pleaded guilty in February to charges of making false statements to VA criminal investigators and subscribing to a false tax return. Tillman is scheduled to be sentenced by Judge Klausner on August 27.
“Veterans Affairs employees who engage in collusive relationships with contractors will be aggressively pursued by the Office of Inspector General and prosecuted to the full extent of the law,” said Special Agent in Charge A.E. Pleasant, U.S. Department of Veterans Affairs, Office of Inspector General, Criminal Investigations Division, Western Field Office.
The cases against Scott and Tillman are the result of an investigation by the United States Department of Veterans Affairs, Office of Inspector General; the Federal Bureau of Investigation; and IRS Criminal Investigation.
The prosecution of these cases is being handled by Assistant United States Attorney Ruth C. Pinkel of the Public Corruption and Civil Rights Section.
Owner of Queens Medical Employment Agency Indicted for Visa Fraud ConspiracyRead the Press Release
A federal grand jury in Brooklyn has returned an indictment against Rena Beduya Avendula, the owner and managing executive of Professional Placement & Recruitment, Inc. (PPRI), charging her with a visa fraud scheme that brought Filipino citizens into the United States for financial profit. Avendula is charged with five counts of visa fraud and with conspiring to defraud the United States, commit visa fraud and illegally bring aliens into the United States. Avendula was arrested Friday, arraigned before United States Magistrate Judge Ramon E. Reyes, Jr., and released on a $75,000 bond.
Richard P. Donoghue, United States Attorney for the Eastern District of New York, and William B. Gannon, Special Agent-in-Charge, United States Department of State, Diplomatic Security Service (DSS), Boston Field Office, announced the charges.
“As alleged in the indictment, Avendula engineered a fraud scheme for personal profit by creating fake job positions to deceive a government program that allows a limited number of foreign nationals to enter the United States temporarily to fill highly specialized positions,” stated United States Attorney Donoghue. “We will continue to protect the integrity of our immigration process by ensuring that only qualified people receive these visas.”
“The Diplomatic Security Service is firmly committed to working with the U.S. Attorney’s Office and our other law enforcement partners to investigate allegations of crime related to passport and visa fraud and to bring those who commit these crimes to justice,” stated DSS Special Agent-in-Charge Gannon. Mr. Gannon also praised the efforts of the DSS New York Field Office, which provided outstanding investigative assistance during this case.
As alleged in the indictment, Avendula engaged in a scheme from October 2009 to February 2015 to bring Filipino citizens into the United States illegally by fraudulently claiming to the United States Citizenship and Immigration Services (USCIS) that the foreign nationals would be employed in “specialty occupations,” thereby qualifying for H-1B visas. The H-1B nonimmigrant visa classification allows foreign nationals to enter the United States temporarily for the specific purpose of working for the employer in a “specialty occupation.” A “specialty occupation” requires certain specialized knowledge and a bachelor’s or higher level degree for entry into the occupation within the United States labor market. General registered nurses (RNs) typically do not qualify as beneficiaries for H-1B visas. A sponsoring U.S. employer must submit a USCIS Form I-129 Petition for a Nonimmigrant Worker, along with supporting documentation, attesting that the visa beneficiary will be employed in a specialty occupation and paid at least the local prevailing wage paid to similarly qualified U.S. citizens and legal permanent residents working in the area. A limited number of H-1B visas are issued each year.
As alleged in the indictment, Avendula used PPRI, based in Woodside, New York, to further her visa fraud scheme. PPRI specialized in providing nursing care to elderly patients. Avendula, in an effort to secure some of the limited number of H-1B visas that are available each year, falsely stated that foreign nurses would be working in specialized nursing at prevailing wage rates. In fact, they were going to work as licensed practical nurses or RNs at significantly lower rates of pay, mostly at nursing homes and rehabilitation centers. The defendant sponsored dozens of fraudulent applications and profited from the filing fees she collected from the nurses and from the health care facilities that paid PPRI.
The charges announced today are merely allegations, and the defendant is presumed innocent unless and until proven guilty. If convicted, the defendant faces a statutory maximum of 10 years’ imprisonment for the visa fraud charges, and 10 years’ imprisonment for each foreign national she induced to reside in the United States in connection with the visa fraud conspiracy.
The government’s case is being handled by the Office’s General Crimes Section. Assistant United States Attorney Elizabeth Losey Macchiaverna is in charge of the prosecution.
The Defendant: RENA BEDUYA AVENDULA
Age: 50
Woodside, New YorkE.D.N.Y. Docket No. 18-CR-246 (DLI)
Oklahoma City Man Sentenced to 10 Years in Prison for Attempting to Entice a 14-Year-OldRead the Press Release
OKLAHOMA CITY – HARRY DEAN WHEELER, JR., 68, of Oklahoma City, was sentenced today for attempting to entice a minor to have sex, announced Robert J. Troester, Acting United States Attorney for the Western District of Oklahoma.
According to an affidavit in support of a criminal complaint, an undercover agent with the Oklahoma Bureau of Narcotics and Dangerous Drugs posted an advertisement on Craigslist on September 19, 2017, in which he claimed to be a boy looking for a "daddy" who would be "willing to teach me about sex." The affidavit explained that through the Craigslist email reply function, Wheeler used explicit sexual language to indicate he wanted to meet the boy for a sexual encounter. He also included three nude photos of himself. According to the affidavit, the undercover agent responded: "Wow, your [sic] hot and sound really cool. Just to get it out of the way, I’m 14, but I’m very mature for my age, that’s why I don’t mind older guys." The affidavit stated Wheeler then replied by email: "We must keep it a secret as what we will be doing is not legal." Wheeler allegedly arranged to meet the person he thought was a 14-year-old boy in the parking lot of a business at 5501 North May Avenue in Oklahoma City, with the intention of driving him to his own residence. When Wheeler arrived at the parking lot and identified himself to the undercover agent as "daddy," federal agents arrested him.
The U.S. Attorney’s Office filed a criminal complaint against Wheeler on September 21, 2017. On November 8, 2017, a federal grand jury indicted him on one count of using a facility and means of interstate commerce to attempt to persuade, induce, and entice an individual he believed to be under the age of 18 to engage in sexual activity. On December 7, 2017, Wheeler pleaded guilty to that offense before U.S. District Judge Timothy D. DeGiusti.
At sentencing today, Judge DeGiusti sentenced Wheeler to ten years in prison. Upon release from prison, he will serve five years on supervised release. He will also be required to pay a $5,000 special assessment pursuant to the Justice for Victims of Trafficking Act.
This case is the result of an investigation by Homeland Security Investigations, part of the U.S. Department of Homeland Security, and the Oklahoma Bureau of Narcotics and Dangerous Drugs. Assistant U.S. Attorney Brandon Hale prosecuted the case.
Reference is made to court filings for further information.
Niagara Falls Man Sentenced on Gun ChargesRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y.—U.S. Attorney James P. Kennedy, Jr. announced today that Jerry Brown, 63, of Buffalo, NY, who was convicted of possession of a firearm in furtherance of drug trafficking and possession of a firearm with a defaced serial number, was sentenced to 101 months in prison by U.S. District Judge Richard J. Arcara.
Assistant U.S. Attorney Laura A. Higgins, who handled the case, stated that on January 12, 2012, law enforcement officers observed the defendant and co-defendant, Guy Lightfoot, conduct a suspicious transaction outside of 1953 Falls Street in Niagara Falls, NY. Brown, who was in his vehicle when officers approached, attempted to flee which led to a car chase. When officers located the defendant’s vehicle, it was vacant. A search of the vehicle uncovered four rounds of 9mm ammunition and a quantity of cocaine and heroin. Officers then searched the surrounding area and located a 9mm, semi-automatic handgun, bearing a defaced serial number, on a roof top in close proximity to the vehicle. The defendant was located and arrested. The serial number on the firearm was restored using magnetic particle and chemical techniques. Investigation determined it was stolen from a private residence in Niagara Falls.
Guy Lightfoot was previously convicted and sentenced.
Today’s sentencing is the result of an investigation by the Niagara Falls Police Department, under the direction of Chief Bryan DalPorto, and Immigration and Customs Enforcement, Homeland Security Investigations, under the direction of Special Agent-in Charge Kevin Kelly.
Nebraska Man Sentenced to Prison for Producing Child PornographyRead the Press Release
A Nebraska man was sentenced today to 15 years in prison, to be followed by five years of supervised release, for producing child pornography in 2015, announced Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division and U.S. Attorney Joseph P. Kelly of the District of Nebraska.
Nicholas Alford, 26, of Bellevue, Nebraska, pleaded guilty on Feb. 15, 2018 to one count of production of child pornography before Chief U.S. District Court Judge Laurie Smith Camp of the District of Nebraska, who sentenced him earlier today and remanded him to the custody of the U.S. Marshals Service.
According to admissions made in connection with his guilty plea, in July 2015, Alford provided a 13-year-old minor with the username for a Kik Messenger account user who Alford claimed would pay the minor money in exchange for sexually explicit images. Alford was actually the user of the Kik Messenger account, and, in that capacity, he persuaded the minor to send dozens of sexually explicit images to his Kik Messenger account. A search warrant executed on Alford’s Bellevue residence resulted in the discovery of dozens of images and videos depicting the minor engaged in sexually explicit conduct.
The FBI Cyber Crimes Task Force is investigating this case. Trial Attorneys William M. Grady and Jessica Urban of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Michael P. Norris of the District of Nebraska are prosecuting the case.
This investigation is a part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Nebraska Man Sentenced to Prison for Producing Child PornographyRead the Press Release
A Nebraska man was sentenced today to 15 years in prison, to be followed by five years of supervised release, for producing child pornography in 2015, announced Acting Assistant Attorney General John P. Cronan of the Justice Department’s Criminal Division and U.S. Attorney Joseph P. Kelly of the District of Nebraska.
Nicholas Alford, 26, of Bellevue, Nebraska, pleaded guilty on Feb. 15 to one count of production of child pornography before Chief U.S. District Court Judge Laurie Smith Camp of the District of Nebraska, who sentenced him earlier today and remanded him to the custody of the U.S. Marshals Service.
According to admissions made in connection with his guilty plea, in July 2015, Alford provided a 13-year-old minor with the username for a Kik Messenger account user who Alford claimed would pay the minor money in exchange for sexually explicit images. Alford was actually the user of the Kik Messenger account, and, in that capacity, he persuaded the minor to send dozens of sexually explicit images to his Kik Messenger account. A search warrant executed on Alford’s Bellevue residence resulted in the discovery of dozens of images and videos depicting the minor engaged in sexually explicit conduct.
The FBI Cyber Crimes Task Force is investigating this case. Trial Attorneys William M. Grady and Jessica Urban of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) and Assistant U.S. Attorney Michael P. Norris of the District of Nebraska are prosecuting the case.
This investigation is a part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by U.S. Attorneys’ Offices and CEOS, Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Nampa Man Sentenced for Distribution of MethamphetamineRead the Press Release
BOISE - Robert Carlos Morales, 41, of Nampa, Idaho, was sentenced last week for distribution of methamphetamine, U.S. Attorney Bart M. Davis announced. Senior U.S. District Judge Edward J. Lodge sentenced Morales to140 months in prison. The Court also ordered that upon completion of his sentence, Morales serve four years of supervised release.
According to evidence presented in court, on March 14, 2017, Morales and co-defendant Anna Marie Delagarza distributed 53 grams of pure methamphetamine to an individual in Nampa, Idaho. On July 25, 2017, officers arrested Morales and discovered an additional 51 grams of methamphetamine in his vehicle. At the time these events occurred, Morales had absconded from felony supervised release on a previous federal drug trafficking case.
On January 24, 2018, Anna Marie Delagarza pleaded guilty to conspiracy to distribute methamphetamine. On April 17, 2018, Judge Lodge sentenced Delagarza to 72 months in prison.
This case was investigated by the Drug Enforcement Administration, Ada County Sheriff’s Office, the U.S. Marshals Service, and the Nampa Police Department.
This case was prosecuted by the Special Assistant U.S. Attorney hired by the Ada County Prosecuting Attorney’s Office, with funds provided by the Oregon-Idaho High Intensity Drug Trafficking Area (HIDTA). The HIDTA program is a national drug-prohibition enforcement program run by the United States Office of National Drug Control Policy. The Oregon-Idaho HIDTA is a collaboration of local law enforcement drug task forces and prosecuting agencies dedicated to addressing regional drug trafficking organizations. Idaho uses HIDTA funds to investigate and prosecute drug trafficking organizations that operate in and around Ada, Canyon, and Bannock counties.
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Médico del Sur de Texas Acusado de $240 Millones en Fraude al Sistema de Salud y Una Estratagema Internacional de Lavado de DineroRead the Press Release
WASHINGTON – A un médico radicado en el área de McAllen, Texas se le hizo una acusación formal, la cual se hizo pública el día de hoy, por su participación en un fraude de $240 millones al sistema de salud y una estratagema internacional de lavado de dinero.
El Fiscal General Adjunto John P. Cronan de la División Criminal del Departamento de Justicia, el Fiscal de los Estados Unidos Ryan J. Patrick del Distrito del Sur de Texas, el Agente Especial a Cargo C.J. Porter del Departamento de Salud y Servicios Humanos de los Estados Unidos de la Oficina del Inspector General (HHS-OIG) de la Región de Dallas y el Agente Especial a Cargo Christopher Combs de la Oficina Regional del FBI en San Antonio, emitieron el comunicado.
Jorge Zamora-Quezada, de 61 años, de Mission, Texas, fue acusado de siete cargos en el Distrito del Sur de Texas. Se le acusó de un cargo de asociación ilícita para cometer fraude al sistema de salud, cinco cargos de fraude al sistema de salud y un cargo de asociación ilícita para llevar a cabo el lavado de dinero.
“Jorge Zamora-Quezada presuntamente organizó una estratagema de fraude masivo que puso en peligro la salud y el bienestar de niños inocentes, personas de tercera edad y víctimas con discapacidad,” dijo el Fiscal General Adjunto Cronan. “Las alegaciones de que Zamora-Quezada violó su juramento de no hacer daño, al administrar quimioterapia innecesaria y otros medicamentos tóxicos, a pacientes con enfermedades graves — incluyendo a algunas de las víctimas más vulnerables que se pueda imaginar — son difíciles de entender. La División Criminal está comprometida a combatir el fraude al sistema de salud y de proteger a las víctimas de estratagemas censurables, como la que se alega en este caso.”
“Tomamos alegaciones de esta naturaleza muy en serio,” dijo el Fiscal estadounidense Patrick. “El enjuiciamiento contra el fraude al servicio de salud es una mayor prioridad para el Distrito del Sur de Texas, especialmente cuando sospechamos que pacientes vulnerables han sido presuntamente explotados, diagnosticados erróneamente o que quizá se les ha recetado medicamento que posiblemente sea dañino, como una manera de cometer este fraude.”
“La acusación formal del día de hoy es el primer paso en hacer al Dr. Zamora-Quezada responsable de su presunta conducta atroz y delictiva,” dijo HHS-OIG Agente Especial a Cargo Porter. “Sus pacientes confiaban en él y creían en su integridad; a cambio, presuntamente participó en una estratagema de diagnósticos y tratamientos falsos, y recetó medicamentos innecesarios y dañinos, a fin de obtener una ganancia financiera personal y sin tomar en cuenta el bienestar del paciente. HHS-OIG siempre perseguirá a delincuentes que se hagan pasar por médicos legítimos, los erradicará y les dará el castigo más severo posible, especialmente cuando el daño al paciente está de por medio.”
“El FBI está comprometido a trabajar con nuestros socios de los grupos operativos para combatir el fraude al sistema de salud,” dijo el Agente Especial a Cargo Combs. “Es un delito muy serio que va en aumento y que ha impactado cada ciudad y pueblo de la nación. Esta investigación destaca una inquietud aun mayor que es representante del fraude al sistema de salud, más allá de las pérdidas financieras significativas, es el daño físico y emocional que sufren los pacientes y sus familias. Por esta razón nosotros en el FBI, junto con nuestros socios de los grupos operativos, estamos comprometidos a ofrecerle justicia a las víctimas de los presuntos delitos del Dr. Zamora-Quezada.”
Como expone la acusación formal, desde el año 2000 hasta el día de la presentación de la acusación formal, Zamora-Quezada y sus cómplices diagnosticaron erróneamente a pacientes vulnerables – incluyendo a menores de edad, personas de tercera edad y personas con discapacidad, en el Valle del Río Grande, San Antonio, y en otros lugares – con varias enfermedades degenerativas, incluyendo la artritis reumatoide. Junto a sus cómplices, les administró quimioterapia y otros medicamentos tóxicos a pacientes basados en ese diagnóstico falso. Además de darles diagnósticos falsos a los pacientes, Zamora-Quezada y sus cómplices presuntamente llevaron a cabo una serie de procedimientos médicos fraudulentos, repetitivos y excesivos con los pacientes, a fin de aumentar los ingresos y financiar el estilo de vida lujosa y extravagante de Zamora-Quezada.
La acusación formal alega que Zamora-Quezada y sus cómplices volaban el avión privado de Zamora-Quezada de un millón de dólares o manejaban su Maserati, ambos grabados con sus iniciales, “ZQ”, entre sus oficinas en el Valle del Río Grande y San Antonio a fin de llevar a cabo el fraude. Él, junto a sus cómplices transfirieron el dinero recaudado de su asociación ilícita para comprar aviones privados, vehículos de lujo, ropa de tiendas de calidad superior como Louis Vuitton y propiedades exclusivas en varias partes de los Estados Unidos y México. Él, junto a sus cómplices presuntamente obstruyeron investigaciones al crear expedientes médicos falsos y ficticios, y le ocultaron miles de expedientes médicos a Medicare almacenándolos en establos inseguros y destartalados, ubicados en el Valle del Río Grande.
La acusación formal también alega que Zamora-Quezada y sus cómplices lavaron las ganancias de su estratagema, malgastando, transformando y ocultando la fuente y el lugar de sus ganancias al invertirlas en propiedades comerciales y residenciales en los Estados Unidos y México. Entre las propiedades, él junto a sus cómplices adquirieron dos penthouses en Puerto Vallarta, México; un condominio en Aspen, Colorado; un condominio en Punta Mita, México; y numerosas casas y propiedades comerciales ubicadas en diferentes partes de Texas. Después creó la falsa apariencia de riquezas e ingresos legítimos alquilándole a individuos y a entidades varias propiedades comerciales y residenciales que él había adquirido. Zamora-Quezada y sus cómplices presuntamente lavaron las ganancias en una casa de cambio, enviándolas a varias cuentas que mantenían en instituciones financieras en México.
La acusación formal solicita el decomiso del avión privado, el Maserati y las diferentes propiedades residenciales y comerciales de Zamora-Quezada en los Estados Unidos y México.
Una acusación formal es simplemente una alegación y todo acusado es inocente hasta que se compruebe su culpabilidad más allá de una duda razonable en un tribunal de justicia.
La Oficina Regional de McAllen de HHS-OIG, el Grupo Operativo contra el Fraude al Sistema de Salud de la Oficina Satélite de McAllen en el Valle del Río Grande de la División de San Antonio y el Grupo Operativo de McAllen contra Delitos Financieros están llevando a cabo la investigación de este caso. Estos grupos operativos están compuestos de investigadores del Departamento de Seguros de Texas, del Departamento de Policía de McAllen, del Departamento de Policía de Pharr y de la Comisión de Salud y Servicios Humanos de Texas.
El Abogado Procesalista Kevin Lowell de la Sección de Fraude de la División Criminal y el Fiscal Adjunto de los Estados Unidos Andrew Swartz del Distrito del Sur de Texas, están llevando este caso a juicio.
El FBI está buscando identificar posibles víctimas de Zamora-Quezada y sus cómplices. Si usted fue paciente de Zamora-Quezada entre enero 2000 y mayo 2018 y cree que pudo haber sido afectado por sus presuntos delitos y el de sus cómplices, por favor llame al FBI a su línea directa, 1-833-432-4873, Opción 8 o 9, o si tiene acceso a un correo electrónico, envié su correo al grupo operativo a [email protected]. Por ley el FBI tiene que identificar a las víctimas de los delitos federales que investiga y tiene que proporcionarles a dichas víctimas información, servicios de asistencia y recursos.
La Sección de Fraude lidera el Equipo de Prevención de Fraude al Medicare, el cual forma parte de una iniciativa conjunta entre el Departamento de Justicia y HHS, quienes enfocan sus esfuerzos para prevenir e impedir el fraude e implementan las leyes actuales en contra del fraude en todo el país. El Equipo de Prevención de Fraude al Medicare opera en nueve localidades en toda la nación. Desde su comienzo en marzo del 2007, el Equipo de Prevención de Fraude al Medicare ha presentado cargos a más de 3,500 acusados quienes han colectivamente defraudado al programa de Medicare por más de $12.5 mil millones.
Monroe County Man Sentenced for Discharge of Firearm During A Drug Trafficking CrimeRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that on May 11, 2018, United States District Court Judge Malachy E. Mannion sentenced Pablo Martinez, age 28, of East Stroudsburg, Pennsylvania, to 150 months’ imprisonment for a shooting that occurred in East Stroudsburg on January 12, 2016.
According to United States Attorney David J. Freed, Martinez pled guilty to the discharge of a firearm during and in relation to a drug trafficking crime and a crime of violence. Martinez admitted that he was part of a conspiracy to rob a fellow drug dealer, lured to a meeting under the guise of a marijuana deal. Martinez and co-conspirators waited in a pickup truck until the victim entered the front passenger seat, then sped off. During the ensuing altercation, Martinez shot the victim twice, and the victim was thrown from the truck at speed, suffering severe injuries. Martinez was a member of the Brick City Brims, a violent street gang involved in drug trafficking and other criminal activity in the East Stroudsburg area.
Two codefendants, Deshaun Lipscomb and Orrett Campbell, have pled guilty to felony charges and are awaiting sentencing.
The case was investigated by the Federal Bureau of Investigation, the Pennsylvania State Police, and the Stroud Area Regional Police Department. Assistant U.S. Attorney Sean A. Camoni is prosecuting the case.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
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Mexican National Sentenced to 127 Months for Drug Trafficking and Unlawful Re-Entry into United StatesRead the Press Release
LEXINGTON, Ky. – On Friday, a Mexican National, Hector Salas-Pina, 40, was sentenced to 127 months in federal prison. United States District Judge Danny C. Reeves sentenced Salas-Pina for conspiracy and possession with the intent to distribute cocaine and unlawful re-entry into the United States, after a previous deportation for an aggravated felony.
Salas-Pina was tried and convicted of the drug charges, in February of this year. The evidence at trial established that Salas-Pina obtained six kilograms of cocaine, from other individuals who had concealed it in the axles of a trailer. Salas-Pina drove a vehicle and the trailer to Lexington, to be delivered to a cocaine dealer for sale in Lexington. On May 17, 2017, members of the Lexington Police Department, in conjunction with the FBI and KSP, made a stop of the vehicle and trailer and subsequently located the cocaine. The street value of the cocaine is approximately $600,000. Following the trial, Salas-Pina entered a guilty plea to re-entry charge.
Under federal law, Salas- Pina must serve 85 percent of his prison sentence; and upon release, he will be deported from the United States.
Robert M. Duncan, Jr., United States Attorney for the Eastern District of Kentucky; Amy Hess, Special Agent in Charge, FBI; Kristoffer Cortez, Acting Assistant Field Office Director , Department of Homeland Security, U.S. Immigration and Customs Enforcement; Richard Sanders, Commissioner of the Kentucky State Police: and Chief Lawrence Weathers, Lexington Police Department, jointly made the announcement.
The investigation was conducted by the FBI, ICE, KSP, and the Lexington Police Department. The United States was represented by Assistant United States Attorney Roger W. West.
Mexican National Pleads Guilty to Distributing MethamphetamineRead the Press Release
SACRAMENTO, Calif. — Today, just as trial was set to begin, Martin Gasca-Rojas, 49, of Mexico, pleaded guilty to three counts of distributing methamphetamine, U.S. Attorney McGregor W. Scott announced.
According to court documents, between October 2016 and May 2017, Gasca-Rojas distributed nearly 4 pounds of methamphetamine on three occasions. In October 2016, Gasca‑Rojas sold 1 pound of methamphetamine for $3,300. In November 2016, he arranged a sale of 2 pounds of methamphetamine for $6,500, and had two other individuals deliver the methamphetamine. Finally, in May 2017, he sold 1 pound of methamphetamine for $3,600.
This case is the product of an investigation by the Drug Enforcement Administration and the U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI). Assistant U.S. Attorneys Audrey B. Hemesath and Owen Roth are prosecuting the case.
Gasca-Rojas is scheduled to be sentenced by U.S. District Judge John A. Mendez on August 21, 2018. Gasca-Rojas faces a maximum statutory penalty of life in prison and a $10 million fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.
Memorial Hermann Health System to Pay Nearly $2 Million to Resolve Improper Billing AllegationsRead the Press Release
HOUSTON – One of Houston’s largest health care providers has agreed to pay the United States $1,929,071.38 to resolve allegations that it improperly billed government healthcare programs, announced U.S. Attorney Ryan K. Patrick. The allegations include inappropriately billing for inpatient services provided to Medicare beneficiaries who were admitted for scheduled surgical procedures, but should have been treated in a less expensive outpatient or observation setting.
“Charging the government for higher cost inpatient services when patients only require lower cost outpatient services is a waste of taxpayer money and a violation of trust with the patient and with the government,” said Patrick. “This settlement should deter similar conduct in the future and help make health care more affordable.”
The government alleged that from Jan. 1, 2009, through Dec. 31, 2014, three Memorial Hermann Health System (MHHS) hospitals - the Texas Medical Center, Southwest and Memorial City - submitted claims to Medicare for scheduled surgical procedures in which the patient’s hospital stay lasted two days or less as inpatient services. The claims should have been submitted as outpatient services. This allegedly caused these three hospitals to receive more in reimbursements from the Medicare program than they were entitled to collect. These payments were mistakenly made and caused MHHS to be unjustly enriched, entitling the United States to compensation.
This settlement is a representation of the coordinated efforts of the U.S. Attorney’s Office, Department of Health and Human Services (DHHS) - Office of Inspector General and DHHS - Office of Audit Services to combat healthcare fraud and abuse.
The claims resolved by this agreement are allegations only, and there has been no determination of liability.
Assistant U.S. Attorney Andrew A. Bobb handled the matter on behalf of the Southern District of Texas.
Martinsburg man admits to illegal ammunition chargeRead the Press Release
MARTINSBURG, WEST VIRGINIA – Gary Owen Jones, of Martinsburg, West Virginia, has admitted to an illegal possession of ammunition charge, United States Attorney Bill Powell announced.
Jones, age 46, pled guilty to one count of “Unlawful Possession of Ammunition.” Jones, who was previously convicted of a felony in the Circuit Court of Berkeley County, possessed more than 1,100 rounds of ammunition in February of 2018 in Berkeley County.
Jones faces up to 10 years incarceration and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Lara Omps-Botteicher is prosecuting the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms, and Explosives investigated.
U.S. Magistrate Judge Robert W. Trumble presided.
Local Man Gets More Than Eight Years for Illegally Possessing FirearmRead the Press Release
CORPUS CHRISTI, Texas - A 27-year-old Corpus Christi man has been ordered to federal prison following his conviction of being a felon in possession of a firearm, announced U.S. Attorney Ryan K. Patrick. Cody Anthony Hernandez pleaded guilty Feb. 20, 2018.
Today, Senior U.S. District Judge John D. Rainey sentenced Hernandez to 102 months imprisonment to be followed by three years of supervised release.
In July 2017, authorities were conducting surveillance when they observed Hernandez, who had outstanding municipal warrants, arrive at the location. When officers approached Hernandez, they could see the grip of a handgun inside a backpack that was located in his vehicle. Hernandez was arrested for the warrants and officers recovered a .40 caliber Glock handgun loaded with a 30 round magazine. Hernandez had previously been convicted of a felony and is prohibited by federal law from possessing firearms and ammunition.
In custody since his arrest on the federal indictment, Hernandez will remain in custody pending transfer to a U.S. Bureau of Prisons facility to be designated in the near future.
The Corpus Christi Police Department, the Bureau of Alcohol, Tobacco, Firearms and Explosives and Immigration and Customs Enforcement’s Homeland Security Investigations conducted the investigation. Assistant U.S. Attorney Lance Watt is prosecuting the case.
Lancaster Man Pleads Guilty to Tax EvasionRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y. - U.S. Attorney James P. Kennedy, Jr. announced today that Ronald Wieczorek, 57, of Lancaster, NY, pleaded guilty before U.S Magistrate Judge H. Kenneth Schroeder to tax evasion. The charge carries a maximum penalty of five years in prison and a fine of $250,000.
Assistant U.S. Attorney Russell T. Ippolito, who is handling the case, stated that between January 1, 2000, and April 15, 2013, the defendant attempted to evade paying individual federal income taxes for the calendar years 2000 through 2009.
During the above time-period, the defendant took a number of steps to hide his income and assets from the IRS in order to prevent the IRS from collecting on taxes that he owed. For example, on May 27, 2009, Wieczorek dissolved his own business and created two new businesses, RMS Blacktop and RMS Hauling, in the name of another individual, in order to conceal his assets.
The defendant also used business receipts and money from these business accounts to pay personal expenses, including the payment of personal credit card expenses. In order to do so, Wieczorek forged the name of a person with signatory authority on the business account checks.
The defendant made numerous other attempts to conceal his assets from the IRS including, on three occasions, filing false statements with the IRS indicating that he could not afford to pay the taxes he owed. The tax loss to the IRS totaled $962,488.98.
Today’s plea is the result of an investigation by the Internal Revenue Service, Criminal Investigation Division, under the direction of Special Agent-in-Charge James D. Robnett.
Sentencing will be scheduled at a later date.
Kalamazoo-Area Man Sentenced to 25 Years in Federal Prison for Producing Child PornographyRead the Press Release
GRAND RAPIDS, MICHIGAN – Brandon Jacob Cochran, 26, formerly from Portage, Michigan, was sentenced to 25 years in federal prison for producing child pornography, U.S. Attorney Andrew Birge announced today. In addition to the prison term, U.S. District Judge Janet T. Neff imposed a 10-year term of supervised release that will commence once Cochran is released from imprisonment. Cochran will also be required to register as a sexual offender.
Cochran pled guilty on February 5, 2018. He admitted that he had molested and digitally penetrated a three-year-old child, and he had used his cellphone to photograph the abuse. In its sentencing memorandum, the U.S. Attorney’s Office argued in favor of a lengthy sentence, emphasizing that the victim in this case was only three years old and particularly vulnerable to Cochran’s predation. Moreover, Cochran had a history of sexually abusive conduct, and he had amassed a sizable collection of child pornography in addition to the images he created. The government argued that a lengthy sentence was needed both to protect the public and “to reflect the gravity and seriousness of the defendant’s crimes, to promote respect for the law, and to justly punish the defendant.”
This case is part of Project Safe Childhood, a nationwide initiative designed to protect children from online exploitation and abuse. The U.S. Attorney's Office, county prosecutor's offices, the Internet Crimes Against Children task force (ICAC), federal, state, and local law enforcement are working closely together to locate, apprehend, and prosecute individuals who exploit children. The partners in Project Safe Childhood work to educate local communities about the dangers of online child exploitation, and to teach children how to protect themselves. For more information about Project Safe Childhood, please visit the following web site: www.projectsafechildhood.gov. Individuals with information or concerns about possible child exploitation should contact local law enforcement officials.
The Detroit and Cleveland Divisions of the Federal Bureau of Investigation (FBI), Portage Police Department, and Michigan State Police investigated the case. Assistant U.S. Attorney Sean M. Lewis prosecuted the case.
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Jamaican Woman Guilty of Lottery Scam Targeting Elderly VictimsRead the Press Release
ALEXANDRIA, Va. – A Jamaican citizen pleaded guilty today to orchestrating a lottery fraud that scammed elderly victims out of approximately $385,000.
According to court documents, Tessicar Karelle Jumpp, 34, conspired with several of her family members and associates to scam elderly victims out of their savings. From her home in Jamaica, Jumpp contacted victims in the United States and used an alias to pretend to be a representative of Publishers Clearing House. Jumpp falsely informed her victims that they had won a lottery prize of millions of dollars, but that in order to collect their winnings, they would need to pay taxes and advance fees. Jumpp then instructed her victims to send funds through wire transfers and in packages of cash mailed to her co-conspirators in the United States. Those co-conspirators would keep a portion of the funds and then send the remainder to Jumpp and others in Jamaica. Jumpp’s victims included an 85-year-old woman from Great Falls who was scammed out of over $335,000, and an 85-year-old Massachusetts man who was defrauded out of almost $50,000.
Earlier this year, the Department of Justice and its law enforcement partners coordinated the largest sweep of elder fraud cases in history. The cases involved more than 250 defendants from around the globe who victimized more than a 1 million Americans, most of whom were elderly. The cases include criminal, civil, and forfeiture actions across more than 50 federal districts.
Jumpp was extradited to the United States from Jamaica and pleaded guilty to conspiracy to launder monetary instruments. She faces a maximum penalty of 20 years in prison when sentenced on August 10. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
Tracy Doherty-McCormick, Acting U.S. Attorney for the Eastern District of Virginia, Nancy McNamara, Assistant Director in Charge of the FBI’s Washington Field Office, Joseph Cronin, Acting Inspector in Charge of the Washington Division of the U.S. Postal Inspection Service, and Brian A. Michael, Acting Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Newark Field Office, made the announcement after Senior U.S. District Judge T.S. Ellis, III accepted the plea. Assistant U.S. Attorney Samantha Bateman is prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information is located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:14-cr-416.
Jackson Man Pleads Guilty to Illegally Possessing a Firearm under Project EJECTRead the Press Release
Jackson, Miss. – Marcus Reese, 38, of Jackson, pled guilty Thursday before United States 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).
On September 8, 2017, law enforcement attempted to execute a search warrant at Marcus Reese’s apartment on O’Bannon Street in Jackson, Mississippi—a place suspected of illegal drug activity. As officers approached the apartment, Reese fled on foot through his apartment and ran out the back door. Officers ultimately stopped Reese and arrested him. They found a loaded Taurus .357 revolver in Reese’s pants pocket.
Reese has a previous conviction in Hinds County, Mississippi, for the felony offense of conspiracy to commit murder.
Reese will be sentenced in Jackson by Judge Daniel P. Jordan III on August 21, 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.
This case is part of Project EJECT, an initiative by the U.S. Attorney’s Office for the Southern District of Mississippi under the U.S. Department of Justice’s Project Safe Neighborhoods (PSN). EJECT is a holistic, multi-disciplinary approach to fighting and reducing violent crime in Jackson through prosecution, prevention, re-entry and awareness. EJECT stands for "Empower Jackson Expel Crime Together." PSN is a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. Attorney General Jeff Sessions reinvigorated PSN in 2017 as part of the Department’s renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
U.S. Attorney Hurst commended the work of the Jackson Police Department and their cooperation with ATF agents and Project EJECT task force members in the investigation of this case.
Inmate Sentenced to Nine Years for Razor AttackRead the Press Release
SCRANTON - The United States Attorney’s Office for the Middle District of Pennsylvania announced today that on May 10, 2018, United States District Court Judge Matthew W. Brann sentenced Robert Stoddard, of Washington D.C., to nine years in prison for assault with a dangerous weapon and possession of contraband while an inmate at United States Penitentiary, Allenwood. A federal jury in Williamsport found Stoddard, age 47, guilty of both charges after a two-day trial in January.
According to United States Attorney David J. Freed, Stoddard attacked another inmate with a weapon fashioned from a razor blade. The victim required over fifty stitches for his wounds and was permanently scarred on a substantial portion of his face. Jurors viewed a security camera video of the attack from two angles and heard testimony from correctional officers, a prison psychologist, and the victim himself. Stoddard testified in his own defense, and was later found to have obstructed justice, in part, because he gave testimony that was untruthful.
By law, the 108-month sentence will run consecutive to Stoddard’s current sentence, which won’t be fully served until March of 2021.
The investigation was conducted by the Federal Bureau of Investigation and officers at USP Allenwood. The case was prosecuted by Assistant United States Attorneys Sean A. Camoni and Alisan VanFleet.
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Illegal Alien Admits Unlawfully Returning to the United States and Failing to Register as A Sex OffenderRead the Press Release
CAMDEN, N.J. – An El Salvadorian man previously convicted for sexually assaulting a child today admitted to failing to register as a sex offender after unlawfully returning to the United States and traveling to New Jersey, U.S. Attorney Craig Carpenito announced.
Samuel De Jesus Corvera-Mata, 42, pleaded guilty before Senior U.S. District Judge Jerome B. Simandle in Camden federal court to a two-count information charging him with illegal re-entry subsequent to conviction for an aggravated felony and failing to register as required by the Sex Offender Registration and Notification Act (SORNA).
SORNA requires all sex offenders to register and keep that registration current in each jurisdiction where the sex offender resides.According to documents filed in this case and statements made in court:
Corvera-Mata admitted that he illegally re-entered the United States after being deported to El Salvador following a 10-year prison sentence in California for committing multiple lewd and lascivious acts upon a seven-year-old child. As a result of his prior offenses, Corvera-Mata was required to register as a sex offender if he ever returned to the United States. Corvera-Mata later illegally re-entered the country and travelled to New Jersey, where he was located and arrested in October 2017.
Corvera-Mata faces a maximum potential penalty of 20 years in prison and a $250,000 fine for the illegal re-entry charge, and 10 years in prison and a $250,000 fine for the SORNA charge. Sentencing is scheduled for Sept. 7, 2018.
U.S. Attorney Carpenito credited officers of U.S. Immigration and Customs Enforcement’s (ICE) Enforcement and Removal Operations (ERO), under Newark Field Office Director John Tsoukaris, and the U.S. Marshals Service, under the direction of U.S. Marshal Juan Mattos in Newark, with the investigation.
The government is represented by Assistant U.S. Attorney Gabriel J. Vidoni of the U.S. Attorney’s Office’s Criminal Division in Camden.
Defense counsel: Maggie Moy Esq., Camden, New Jersey
Hattiesburg Man Sentenced to Two Years in Prison for Tax EvasionRead the Press Release
Hattiesburg, Miss. – Michael J. Super, 44, of Hattiesburg, was sentenced on Thursday by U.S. District Judge Keith Starrett for federal tax evasion, announced U.S. Attorney Mike Hurst and Thomas J. Holloman III, Acting Special Agent in Charge, IRS Criminal Investigation.
Super was sentenced to serve 24 months in federal prison, followed by a three-year term of supervised release. The Court also ordered Super to pay restitution in the amount of $165,075.92.
On February 18, 2018, Super pled guilty to tax evasion for failing to pay federal employee trust fund taxes due on behalf of the employees of his company, Eagle Eye Security Services of Hattiesburg. Super had entered into an agreement with the government to pay these taxes over a period of time, but failed to make any payments. The IRS issued levies against the company, but Super still failed to make any payments. To avoid the IRS levies, Super opened another security business to which he transferred all of the assets and clients of his previous company. When the IRS pursued the assets of the second company, Super again transferred all assets and clients to a third company. The IRS collected some of the employee trust fund taxes due, but Super evaded paying $165,075.92, which he will now be required to pay in restitution as a part of his sentence.
The case was investigated by IRS Criminal Investigation and prosecuted by Assistant United States Attorney Dave Fulcher.
Harrison County man admits to firearm chargeRead the Press Release
CLARKSBURG, WEST VIRGINIA – Christopher Dent, of Bridgeport, West Virginia, has admitted to illegally possessing a firearm, United States Attorney Bill Powell announced.
Dent, age 32, pled guilty to one count of “Unlawful Possession of a Firearm.” Dent, who had previously been convicted of crimes in New Jersey, admitted to having a 9mm caliber pistol in May 2017 in Harrison County.
Dent faces up to 10 years incarceration and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Zelda E. Wesley is prosecuting the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Bridgeport Police Department investigated.
U.S. Magistrate Judge Michael John Aloi presided.
Founders of Cryptocurrency Company Indicted in Manhattan Federal Court with Scheme to Defraud InvestorsRead the Press Release
Robert Khuzami, Attorney for the United States, Acting Under Authority Conferred by 28 U.S.C. § 515, announced that a grand jury in the Southern District of New York has returned an Indictment charging SOHRAB SHARMA, a/k/a “Sam Sharma,” RAYMOND TRAPANI, a/k/a “Ray,” and ROBERT FARKAS, a/k/a “RJ,” a/k/a “Bob,” the three co-founders of a startup company called Centra Tech, Inc. (“Centra Tech”), that purported to offer cryptocurrency-related financial products, with conspiring to commit, and the commission of, securities and wire fraud in connection with a scheme to induce victims to invest millions of dollars’ worth of digital funds for the purchase of unregistered securities, in the form of digital currency tokens issued by Centra Tech, through material misrepresentations and omissions. SHARMA, TRAPANI, and FARKAS were all arrested last month based on criminal complaints filed by this Office charging them with the same crimes.
Following their arrests, this Office and the Federal Bureau of Investigation (“FBI”) seized 91,000 Ether units, consisting of digital funds raised from victims as part of the charged scheme. This seized digital currency is presently worth more than $60 million. The case has been assigned to United States District Judge Lorna G. Schofield.
Mr. Khuzami said: “As alleged, the defendants conspired to capitalize on investor interest in the burgeoning cryptocurrency market. They allegedly made false claims about their product and about relationships they had with credible financial institutions, even creating a fictitious Centra Tech CEO. Whether traditional or cutting-edge, investment vehicles can’t legally be peddled with falsehoods and lies.”
According to the allegations in the Indictment filed in this case, the criminal complaints previously unsealed in this case, and in other filings and statements at public court proceedings in the case:[1]
After SHARMA and TRAPANI worked together at a luxury car rental company in Florida called “Miami Exotics,” they and FARKAS co-founded a startup company called Centra Tech that claimed to offer cryptocurrency-related financial productions, including a purported debit card, the “Centra Card,” that supposedly allowed users to spend various types of cryptocurrency to make purchases at any establishment that accepts Visa or Mastercard payment cards. In approximately July 2017, SHARMA, TRAPANI, and FARKAS began soliciting investors to purchase unregistered securities, in the form of digital tokens issued by Centra Tech, through a so-called “initial coin offering” or “ICO.” As part of this effort, SHARMA, TRAPANI, and FARKAS, in oral and written offering materials that were disseminated via the internet, represented: (a) that Centra Tech had an experienced executive team with impressive credentials, including a purported CEO named “Michael Edwards” with more than 20 years of banking industry experience and a master’s degree in business administration from Harvard University; (b) that Centra Tech had formed partnerships with Bancorp, Visa, and Mastercard to issue Centra Cards licensed by Visa or Mastercard; and (c) that Centra Tech had money transmitter and other licenses in 38 states, among other claims. Based in part on these claims, victims provided millions of dollars’ worth of digital funds in investments for the purchase of Centra Tech tokens. In or about October 2017, at the end of Centra Tech’s ICO, those digital funds raised from victims were worth more than $25 million. Due to appreciation in the value of those digital funds raised from victims, those digital funds are presently worth more than $60 million.
The representations that SHARMA, TRAPANI, and FARKAS made to help secure these investments, however, were false. In fact, the purported CEO “Michael Edwards” and another supposed member of Centra Tech’s executive team are fictitious people who were fabricated to dupe investors; Centra Tech had no such partnerships with Bancorp, Visa, or Mastercard; and Centra Tech did not have such licenses in a number of those states.
SHARMA, TRAPANI, and FARKAS were well aware of the falsity of such claims. For example, with respect to Centra Tech’s purported partnerships with Bancorp, Visa, and Mastercard, SHARMA engaged in a cellphone text message conversation with TRAPANI on or about July 31, 2017, in which they discussed Centra Tech’s lack of actual partnerships with banks or credit card companies. During that exchange, SHARMA wrote: “Should write down a list of places to call tomorrow,” “For the conbranded [sic] card.” Later in the exchange, SHARMA wrote: “Gotta get it going on the banks today plz.” SHARMA also subsequently wrote: “We just need to get s [sic] banking license,” “Need our direct agreement with visa,” “Or MasterCard,” “That’s the move,” “Cut out the middle man,” “I wish we just knew someone.”
With respect to Centra Tech’s purported CEO “Michael Edwards,” SHARMA text-messaged TRAPANI on or about July 29, 2017, that they “Need to find someone who looks like Michael,” “Team photos,” “He’s real lol,” “Everyone real,” “Except Jessica,” “And Mike.” Similarly, SHARMA later wrote during that same exchange: “Gonna kill both Ceo and her,” “Gonna say they were married and got into an accident.”
Finally, with respect to Centra Tech’s purported money transmitter and other licenses in 38 states, SHARMA had a text message conversation with TRAPANI and FARKAS on or about August 30, 2017, about applying for state licenses that Centra Tech had previously represented it already held in 38 states. For example, SHARMA wrote in one message on or about August 30, 2017, to TRAPANI and FARKAS: “Gotta apply for all licenses,” “Should I even say this.”
On or about May 2, 2018, this Office and the FBI seized, pursuant to a judicially authorized seizure warrant, 91,000 Ether units, consisting of digital funds raised from victims who purchased digital tokens issued by Centra Tech during its ICO based on fraudulent misrepresentations and omissions. The seized funds are presently worth more than $60 million.
In a separate action, the United States Securities and Exchange Commission (the “SEC”) has filed civil charges against SHARMA, TRAPANI, and FARKAS.
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SHARMA, 27, TRAPANI, 27, and FARKAS, 31, are all residents of Florida. All three of them are charged in a four-count Indictment with one count of conspiracy to commit securities fraud, which carries a maximum potential sentence of five years in prison; one count of conspiracy to commit wire fraud, which carries a maximum potential sentence of 20 years in prison; one count of securities fraud, which carries a maximum potential sentence of 20 years in prison; and one count of wire fraud, which carries a maximum potential sentence of 20 years in prison. In addition to potential prison sentences, each of these charges also carries potential financial penalties. The maximum potential prison sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by the judge.
Mr. Khuzami praised the work of the FBI and thanked the SEC for its assistance. Mr. Khuzami also thanked the Department of Homeland Security, Homeland Security Investigations (“DHS-HIS”) and the District Attorney’s Office for New York County for their assistance in this case.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant United States Attorneys Samson Enzer and Negar Tekeei are in charge of the prosecution. Assistant United States Attorney Daniel Tracer is in charge of the forfeiture aspects of the case.
The allegations contained in the charging documents in this case 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 Complaints and the Indictment, and the description of the Complaints and the Indictment set forth herein, constitute only allegations, and every fact described should be treated as an allegation.
Former U.S. Border Patrol Agent Sentenced to Seven and A Half Years in Prison for Bribery and Drug TraffickingRead the Press Release
TUCSON, Ariz. - Today, Alberto M. Michel, 41, of Casa Grande, Ariz., was sentenced by Senior U.S. District Judge David C. Bury. Michel had previously pleaded guilty to one count of conspiracy to traffic marijuana and one count of accepting a bribe as a public official. He received a sentence of 90 months in prison followed by 3 years of supervised release and a $24,000 forfeiture judgment.
In his plea agreement, Michel admitted that while employed as a United States Border Patrol Agent, with the Tucson Sector Border Patrol Intelligence Unit, he participated in a drug conspiracy by providing surveillance during drug smuggling efforts. Additionally, Michel provided assistance regarding law enforcement interdiction efforts. He also agreed to receive cash payments equal to $40 per pound of marijuana smuggled and received a total of $24,000 during the course of the conspiracy.
On Aug. 3, 2017 and Aug. 7, 2017, Michel received cash payments totaling $12,000 for agreeing, as a sworn public official, to violate his sworn duty to investigate and interdict narcotics smugglers.
Michel had been employed with United States Border Patrol since 2009. By 2016, he had been promoted to an enhanced role with the Tucson Sector Border Patrol Intelligence Unit, where he had a higher security clearance and had access to information regarding high-level law enforcement and national security operations and techniques.
Co-defendants Eunice M. Lopez and Marco Antonio L. Bustamante are scheduled for Change of Plea Hearings on May 15, 2018.
The investigation was conducted by members of the Southern Arizona Corruption Task Force that consists of the Federal Bureau of Investigation, Department of Homeland Security - Office of the Inspector General, Customs and Border Protection – Office of Professional Responsibility, Immigration and Customs Enforcement – Office of Professional Responsibility, and Tucson Police Department. Prosecution was handled by Sarah B. Houston and Gordon E. Davenport III, Assistant U.S. Attorneys, District of Arizona, Tucson.
CASE NUMBER: 4:17-CR-01733-DCB-JR
RELEASE NUMBER: 2018-063_ Michel_etal
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.
Former Bookkeeper and Associate Sentenced to Prison for Embezzling More Than $1 Million from Fresno BusinessRead the Press Release
FRESNO, Calif. — U.S. District Judge Dale A. Drozd sentenced Brandi Marshall, 41, of Fresno to four years and three months in prison, and Daniel Barrios Jr., 37, of Fresno to two years and seven months in prison for conspiracy to commit wire fraud and bank fraud and conspiracy to launder money in connection with their embezzlement of money from a Fresno business, U.S. Attorney McGregor W. Scott announced.
According to court documents, Marshall was employed as the company’s bookkeeper between October 2014 and March 2016 and was responsible for, among other things, receiving and depositing checks from customers to pay their invoices. During that time, she and Barrios misappropriated more than 100 checks and fraudulently deposited them into Barrios’ personal bank account. Marshall and Barrios used money derived from the fraudulently deposited checks for personal purchases, including more than $35,000 to purchase and accessorize a 2016 Ford Mustang GT, and more than $25,000 to purchase a 2012 Dodge Challenger. Marshall created fictitious entries in the company’s computer accounting application to attempt to conceal the embezzlement. Together, Marshall and Barrios embezzled more than $1 million and were ordered by the court to pay restitution.
This case was the product of an investigation by the Federal Bureau of Investigation. Assistant U.S. Attorney Christopher D. Baker prosecuted the case.